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before the work is completed or finally abandoned, then its liability to contractors or subcontractors left with unpaid claims will be ascertained by an appraisement of the entire original contract price among the several persons who did work or furnished materials on the basis of the cost of the work. To limit this distribution to those claims which were perfected by the statutory notice would be unjust to the owner, who had a right to distribute the contract price during the progress of the work. If, by premature distribution, one incipient lienor is paid more than his proportion, the owner will suffer the loss, and be remitted to his remedy against the original contractor. To require the contract price to be distributed alone among those who finally perfected their claims, and upon the basis of the amount of the claims shown by the completed liens, would do great injustice, and deprive the owner of the right to distribute the contract price among contributors to the work as it progressed. The fact that some of the subcontractors have been paid a larger per cent. of their claims by the principal contractor than others is an advantage of which they should not be deprived. If any part of their claims remains unpaid, they will be entitled to share in the common security ratably. That some of the subcontractors received some of the bonds paid by the railroad company to the principal contractor, and that others received the proceeds derived from sales of such bonds by the contractor, cannot affect the rule of distribution. The bonds were paid to the contract company as an absolute payment, and became the property of that company, to do with as it saw fit. The contract company was absolutely liable to each subcontractor for the full amount of the price agreed to be paid under the subcontracts. The aggregate sums thus due to subcontractors very much exceeded the original contract price. Payments made by the contract company were most often made from a common fund, arising in part from the capital of that company, and in part from proceeds of sales of bonds received from the railroad company; other payments were made on the check of the company against a fund traceable wholly to proceeds of sales of such bonds; and, in still other cases, partial payments were made in such bonds at an agreed cash valuation. But all these payments were made, without regard to the source from which the fund or property came, upon the direct, personal, pecuniary obligation of that company to its subcontractors, and in reduction of that acknowledged liability between debtor and creditor. The first effect of these payments was to reduce the personal and primary liability of the payor. The second and indirect effect was to relieve the property of the railroad company, in so far as such payments, on proper application, might discharge the independent liens of the subcontractors. If the subcontractor took pay in bonds at an agreed value, instead of money, it ought not to operate as a discharge of his lien to any greater extent than a like payment in money. If we are right in holding that a partial pay. ment in money by the contract company, upon its own absolute obligation, would not operate to defeat or release the direct lien of the subcontractor to a ratable proportion of the common security for any balance left unpaid, then it must follow, in the absence of an agreement to the contrary, that it is immaterial whether such payment was made in bonds or money, and immaterial to inquire as to the origin of the contract company's title. The decree declaring the liability of the railroad company proceeded upon the basis we have indicated, and meets our approval.

4. The next objection to the decree presented by the Central Trust Company is as to the method adopted for the ascertainment of the contract price agreed to be paid by the railroad company to the contract company. Appellants insist that it was the duty of the railroad company to withhold the payment of any part of the contract price until all the work contracted for by the principal contractor or by subcontractors had been finished, and all liens ascertained and perfected; that at that time only the contract price should have been ascertained, and distributed among all the persons entitled to share therein. This suggestion is based upon the peculiar facts of this case. The contract price was payable in bonds and shares of stock, and not in money. As between the principal contractor and the railroad company, the latter was obliged to pay this contract price only in bonds and stock. It was also obligated to make these payments on estimates, as the work progressed. This the railroad company did, and paid to the contract company, from time to time, as the work progressed, every dollar that it was obligated to pay. These bonds were converted into money by the contract company, as received, and the proceeds of such sales were the principal source from which the contract company made its partial payments to its subcontractors. The price of these bonds varied. Those first delivered are shown to have sold as high as 90 cents on the dollar, but from that time they declined in market value. Some were sold for 60 cents, some for 40 cents, some for 30 cents; and after a receiver was appointed in this case, and these mechanics' liens asserted, the market value of the bonds had declined to from 12 to 17 cents on the dollar. Now the contention of the trust company is that the money value of the price to be paid by the railroad company should have been ascertained when the work was finally completed or abandoned. This contention would operate to reduce the money value of its contract to a comparatively insignificant sum. The position is inequitable, unjust, and legally unsound. The railroad company had placed itself in a position where it was obligated to pay out these securities to the contract company from time to time. The statute, as we have before said, placed it under the obligation to see that the contract price was ratably distributed among all persons who contributed to the building of the railroad, or the furnishing of materials. If its own contract was inconsistent with its protection against the independent liens of subcontractors, undischarged by a proper application of the contract price by the contractor in discharge of subcontractors' claims, it did not operate to destroy the contract, or to suspend its liability thereunder. It is perhaps true that it might have resorted to a court of equity, and have brought the contractor and subcontractors before the court, and compelled a distribution of the contract price ratably among all the lienholders, or have obtained other equitable interference, by way of an injunction prohibit

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ing the contract company from subletting any of its work unless it should give a bond for the protection of the owner against subcontractors and their liens. If the railroad company chose not to avail itself of possible equitable assistance, it had the right to go ahead, and pay the contract price into the hands of the contractor, as it had agreed to do, and take the risk of liability to subcontractors whose claims should be left unpaid. Now, this is exactly what the railroad company did. If the contract price had been payable in money, instead of bonds and stocks, no such question as this would have been material, but inasmuch as the subcontractors' lien is an independent one, and inasmuch as their contracts with the principal contracto were for money, it follows that the subcontractors' liens operated as a security for the payment of the money; and it is no answer for the railroad company to say that it contracted to pay for the building of its road in land or bonds or shares, and therefore their lien is dischargeable by land or bonds or shares. That would be so if the subcontractors' liens were by way of subrogation. It would be so if the subcontractors were limited to the amount due by the owner to the contractor at the time their liens were acquired. But the lien of the subcontractor, being an independent, direct lien, is a lien for the security of the money due on his contract with the principal contractor. It therefore becomes essential that the money value of the contract price to be paid by the owner shall be ascertained. The subcontractor is bound by that contract price, for the statute provides that the aggregate amount of the liens shall not exceed the original contract price. The method adopted by the circuit court was to ascertain the market value of the bonds and shares at the time they were actually delivered by the railroad company to the contract company in pursuance of the contract between them. That method, we think, was the proper one, and did no injustice to any of the parties concerned.

The insistence of the appellees below, and again presented by their several cross appeals, was, that the contract price was $50,000 per lineal mile, plus the various county aid bonds. This contention rests upon the assumption that for the construction of the railroad, and for the other expenditures to be made by the contract company, itagreed to pay $50,000 per lineal mile, in money, or, at its election, in its bonds and shares. This assumption is radically erroneous. The contract fixed no money value whatever. It provided that “in payment for this work thus to be done, and the expenditures to be made, the railroad company agrees to assign and deliver to the contract company the following named securities, to wit.” This is followed by a detailed statement of the securities to be delivered in payment. By the third paragraph it was provided that payment should be made in monthly installments, as the work progressed. By the fourth paragraph the railroad company agreed to deposit these securities, as soon as practicable, with the Louisville Safety-Vault Company, as trustee under this agreement. The fifth paragraph provides the method of ascertaining, from time to time, the payments due to the contract company, by prescribing that the chief engineer should, from month to month, certify in writing “what proportion the work

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done, and material furnished, bore to the total expenditures and cost of the railroad and equipments, when completed according to this contract, as same may be estimated by said engineer, and the amount payable on account thereof to said contract company, and thereupon the amount so certified shall become immediately pay. able by the railroad company to the contract company.” The sixth paragraph, which gave to the company an option to pay in money, was in these words:

"Paragraph 6. As the several installments of money shall become due to the contract company under this agreement as above provided, it shall be the duty of the railroad company to pay the same in money, or to the trustee an order for a delivery to the contract company, or its order, of the securities deposited with it as above provided, equal in amount, at their par value, to the amount of such installment, as fixed by the certificate of the engineer. If the railroad company should pay any such installments in money, it may, upon depositing with the trustee the receipt of the contract company therefor, withdraw from the hands of the trustee an equal amount, at par, of the bonds and capital stock of the railroad company, such withdrawal to be in equal proportion of each. If payment be made in securities, instead of money, the contract company shall be entitled to receive pro rata payments in the stocks and bonds of the railroad company, after deducting the amounts paid in county bonds, as provided in clause first of paragraph II. of this contract."

It is difficult to draw an inference that the company was to pay at the rate of $50,000 per mile in the event it elected to pay in money, in place of securities. The estimates of the engineer were to be based on the proportion of the work done to the whole amount to be done. Thus, if the estimates showed that 10 per cent. of the whole work had been done and materials furnished, then 10 per cent of the securities had been earned, and were deliverable. It is not within the bounds of reason that these securities were estimated at their par value, or that if, for any reason, the company had refused to deliver them, a money judgment equal to the par of the stocks and bonds would have been recoverable. But, however this may be, the railroad company did deliver these stocks and bonds as they were earned; and this, as we have already seen, it had a right to do. The legal proposition that where a promise is in the alternative, to pay in money or in property, the promisor has an election either to pay in money or the equivalent, and that, if he fail to pay in property on the day of payment, the right of election is gone, and the promisee entitled to payment in money, is not applicable, upon the facts of this case. To be applicable, there must be a promise to pay a definite sum of money, or its equivalent in property, and there must be a failure to pay according to the contract. Neither essential is found here. No contractual relation existed between the railroad company and the subcontractors. It was under no promise to .pay them anything. It is true that they had a direct, statutory lien to secure them in the payment by the contractor of the sums due under their several subcontracts, and it is also true that they have been allowed money decrees against an owner who had a contract to pay only in property. But this is because the property has been paid over to the principal contractor, thus entitling them to a decree for a proportionate part of the value of the property. That value was properly ascertained when the master reported its cash value when paid and delivered to the contract company. The amount to be paid in bonds and stocks for each lineal mile was manifestly not intended as the measure of a money price to be paid, or of a money indebtedness in case of a default in the delivery of the securities. The price to be paid for the work was fixed with reference to the speculative value of the securities in which it was to be paid, and it would be most gross injustice to hold that a price so payable furnished the measure of a money indebtedness. In Railroad Co. v. Kelley, 5 Ohio St. 180, the agreement was that 75 per cent. of the price of construction should be paid in money, and 25 per cent. in the stock of the company. The railroad company made default in delivery of the stock, and was held to have lost the right to pay in stock. But upon a full consideration of the contract the Ohio court held that the price was a stock price, and not a money price, and the price, as payable in stock, was not, in the contemplation of the parties, a money indebtedness, and that it would be a manifest injustice to give the contractors, in cash, what was measured by payment in speculative stock. The court thereupon held that the market value of the stock was the measure of recovery. The cases of Moore v. Railroad Co., 12 Barb. 156, and Parks v. Marshall, 10 Ind. 21, are to the same effect.

5. Appellants' tenth assignment of error is based upon the action of the court in overruling its twenty-ninth exception to the report of Special Master Du Relle. That exception was in these words:

"Because the master valued $652,000 of bonds issued by the Richmond, Nicholasville, Irvine & Beattyville Railroad Company, and afterwards indorsed by the Louisville, New Albany & Chicago Railway Company, at 90 cents on the dollar, being the amount at which they sold after such indorsement, instead of valuing the said bonds at the sum they were worth at the time they were received by the Ohio Valley Improvement & Contract Company without said indorsement."

The contract company entered into an agreement with the Louisville, New Albany & Chicago Railway Company, a corporation of Indiana, by which the latter, in consideration of the transfer to it of a controlling interest in the stock of the Richmond, Nicholasville, Irvine & Beattyville Railroad Company, agreed to indorse the bonds of the latter company, when delivered to the contract company. The latter company is not shown to have had anything to do with this arrangement, the consideration for the indorsement proceeding

holly from the contract company. Bonds to the amount of several hundred thousand dollars were accordingly indorsed and sold before any question was made as to the validity of the indorsement. The master, in ascertaining the value of the contract price to be paid for construction, attached no value to the stock of the railroad company, except in so far as that stock had been used to enhance the value of the bonds, as furnishing a consideration inducing the Indiana Railroad Company to indorse the bonds of the Kentucky Railroad Company. We are unable to see any injustice in this. While the stock had no definite market value in money, yet a controlling interest did have value sufficient to procure an indorsement on the bonds in

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