{ "id": 2553377, "name": "JOSEPH T. RYERSON AND SON, INC., Plaintiff-Appellee, v. MANULIFE REAL ESTATE COMPANY et al., Defendants-Appellants", "name_abbreviation": "Joseph T. Ryerson & Son, Inc. v. Manulife Real Estate Co.", "decision_date": "1990-11-26", "docket_number": "No. 1-89-3431", "first_page": "622", "last_page": "627", "citations": [ { "type": "official", "cite": "207 Ill. App. 3d 622" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "373 N.E.2d 1089", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "58 Ill. App. 3d 173", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 5626401 ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/58/0173-01" ] }, { "cite": "170 Ill. App. 14", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 2778395 ], "opinion_index": 0, "case_paths": [ "/ill-app/170/0014-01" ] }, { "cite": "212 Ill. App. 489", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 5812239 ], "year": 1912, "opinion_index": 0, "case_paths": [ "/ill-app/212/0489-01" ] }, { "cite": "30 N.E.2d 509", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1918, "opinion_index": 0 }, { "cite": "307 Ill. App. 432", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 3186442 ], "weight": 2, "year": 1918, "pin_cites": [ { "page": "439" } ], "opinion_index": 0, "case_paths": [ "/ill-app/307/0432-01" ] }, { "cite": "273 N.E.2d 654", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1940, "opinion_index": 0 }, { "cite": "1 Ill. App. 3d 543", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 5314878 ], "year": 1940, "opinion_index": 0, "case_paths": [ "/ill-app-3d/1/0543-01" ] }, { "cite": "303 N.E.2d 192", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1971, "opinion_index": 0 }, { "cite": "14 Ill. App. 3d 716", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 2686929 ], "year": 1971, "opinion_index": 0, "case_paths": [ "/ill-app-3d/14/0716-01" ] }, { "cite": "272 Ark. 485", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1174920 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/ark/272/0485-01" ] }, { "cite": "255 Ark. 1064", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 8726253 ], "weight": 2, "year": 1981, "opinion_index": 0, "case_paths": [ "/ark/255/1064-01" ] }, { "cite": "261 Ark. 127", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1678939 ], "weight": 2, "year": 1974, "opinion_index": 0, "case_paths": [ "/ark/261/0127-01" ] }, { "cite": "148 Ill. App. 356", "category": "reporters:state", "reporter": "Ill. App.", "case_ids": [ 2647370 ], "weight": 4, "pin_cites": [ { "page": "365-66" }, { "page": "366" }, { "page": "366" } ], "opinion_index": 0, "case_paths": [ "/ill-app/148/0356-01" ] } ], "analysis": { "cardinality": 620, "char_count": 12303, "ocr_confidence": 0.775, "pagerank": { "raw": 7.943004060014475e-08, "percentile": 0.4622541700307624 }, "sha256": "f3aa1b794acddc5eed95915ef72d0ad9feb6adf460711cd30a3c2d38ee42f8a1", "simhash": "1:d3e3124360d0699a", "word_count": 1967 }, "last_updated": "2023-07-14T17:11:09.339704+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "JOSEPH T. RYERSON AND SON, INC., Plaintiff-Appellee, v. MANULIFE REAL ESTATE COMPANY et al., Defendants-Appellants." ], "opinions": [ { "text": "JUSTICE EGAN\ndelivered the opinion of the court:\nThe plaintiff, Joseph T. Ryerson & Son, Inc. (Ryerson), brought suit to foreclose a mechanics\u2019 lien on property owned by defendant Manufacturers Life Insurance Company (Manulife). Manulife had employed defendant E.W. Corrigan Construction Company (Corrigan) as the general contractor on a project requiring Corrigan to construct a new office building in Schaumburg, Illinois. Corrigan, in turn, entered into a subcontract with Crescent Corporation (Crescent) that required Crescent to fabricate and install a curtain wall on the project. Crescent then contracted with Ryerson for the furnishing of certain materials necessary for Crescent\u2019s performance on the subcontract.\nIn December 1985 Crescent ceased to perform on its subcontract with Corrigan, allegedly in breach of that subcontract. Crescent also allegedly failed to pay Ryerson for materials and supplies worth $55,913 which Ryerson had delivered to Crescent and which were received and used in the project. On November 3, 1986, Ryerson filed the underlying suit against Manulife and Corrigan seeking to foreclose its alleged mechanics\u2019 lien for the unpaid balance. Ryerson did not name Crescent as a party to the suit.\nThe defendants, Corrigan and Manulife, each filed a motion to strike the complaint, alleging that Crescent was a necessary party to the action and that the failure to name Crescent constituted a fatal defect in the pleading. Ryerson opposed the motion, and the trial judge denied it. The judge later granted Ryerson\u2019s motion for summary judgment and entered judgment against the defendants jointly for $47,368.30 plus interest.\nThe defendants argue that the trial court erred in denying the motion to strike for failure to name a necessary party. Alternatively, the defendants challenge whether an owner and a general contractor can be required to pay a material supplier to a subcontractor more than the subcontract price or more than the amount owed to the subcontractor when the owner and general contractor received notice of the material supplier\u2019s lien claim.\nSection 22 of the Mechanics\u2019 Liens Act (Act) provides the basis for Ryerson\u2019s lien, stating:\n\u201cWhen the contractor shall sub-let his contract or a specific portion thereof to a sub-contractor, the party furnishing material to or performing labor for such sub-contractor shall have a lien therefor; and may enforce his lien in the same manner as is herein provided for the enforcement of liens by sub-contractors.\u201d (Ill. Rev. Stat. 1989, ch. 82, par. 22.)\nSection 28 of the Act provides for the enforcement of liens by subcontractors and states, in part, as follows:\n\u201cAll suits and actions by sub-contractors shall be against both the contractor and owner jointly, and no judgment shall be rendered therein until both are duly brought before the court by process or publication ***.\u201d (Ill. Rev. Stat. 1989, ch. 82, par. 28.)\nSection 11 of the Act provides:\n\u201c\u00a711. The complaint shall contain a brief statement of the contract or contracts on which it is founded ***. *** The plaintiff shall make all parties interested, of whose interest he is notified or has knowledge, parties defendant, and summons shall issue and service thereof be had as in other civil actions; * * * and his failure to so act with regard to summons or notice shall be ground for judgment against him as upon the merits. *** Parties in interest, within the meaning of this act, shall include *** all persons *** who are interested in the subject matter of the suit.\u201d (Emphasis added.) Ill. Rev. Stat. 1989, ch. 82, par. 11.\nBoiled down, the issue is whether Crescent is a person \u201cinterested in the subject matter of the suit.\u201d The defendants cite John E. Burns Lumber Co. v. W.J. Reynolds Co. (1909), 148 Ill. App. 356, as the only Illinois authority directly in point. In Burns the appellate court found that the evidence showed that the plaintiff had contracted to supply material to a carpentry subcontractor, W.J. Reynolds, an individual. The complaint, however, had named the W. J. Reynolds Company as the alleged subcontractor. (The complaint also named the owner and the general contractor.) The appellate court reversed the judgment in favor of the plaintiff because the complaint had failed to name the true subcontractor, W.J. Reynolds, personally and individually. In so doing the court stated:\n\u201cThe complainant [and other intervening material suppliers] are all furnishers of material for the subcontract and, being of that class, they *** claim liens under section 22 of the Mechanics\u2019 Lien Act. They contracted with and trusted the subcontractor and, through that relation, they claim their lien upon the property. Should they eventually establish a right to liens and thereby the amount the owner would be obliged to pay for the carpenter work be made to exceed the contract price, a right to be reimbursed by the subcontractor, if not by the original contractor, would arise. It is, therefore, of the highest importance that the actual subcontractor, a party in interest and under the lien law a necessary party as such, be a party to this proceeding.\u201d (Emphasis added.) 148 Ill. App. at 365-66.\nThe relation of the parties in Burns is identical to the relation of the parties in this case. The plaintiff in Burns claimed its lien through the subcontractor, Reynolds; Ryerson claimed its lien through its contract with the subcontractor, Crescent. Under the authority of Burns, therefore, it is inescapable that Crescent is \u201ca party in interest and under the lien law a necessary party as such.\u201d 148 Ill. App. at 366.\nRyerson seeks to distinguish Burns; it emphasizes that the trial court in Burns heard evidence which established the interest of the subcontractor, W.J. Reynolds; it further claims that the record in this case shows that Crescent had no interest because Crescent was bankrupt. First of all, there was no need to hear evidence to establish the relationship between Ryerson, Crescent and the defendants. Ryerson\u2019s complaint established the relationship. Second, as the defendants point out, the record does not support a finding that Crescent was bankrupt. Moreover, the trial judge never made such a finding; he was never asked to do so. Indeed, in the memoranda filed by Ryerson in the trial court, no argument was made that Crescent was not a necessary party because it was bankrupt.\nRyerson\u2019s supporting citations to the record on appeal reveal the following: Corrigan stated in its first affirmative defense that Crescent breached its contract, was not owed money by Corrigan and, in fact, owed money to Corrigan; during his deposition, Manulife\u2019s architect was asked whether he had any conversations with Corrigan in December 1985 or January 1986 regarding Crescent, and he stated, \u201cI am not sure of the time, but Crescent was in the process of going bankrupt, I don\u2019t know if it refers to this period or not\u201d; a vice-president of Corrigan stated in his affidavit that \u201cCrescent became unable to perform its obligations under the subcontract with Corrigan and in December, 1985, Crescent completely stopped doing any work on the building.\u201d In arguing the motion for summary judgment, Ryerson\u2019s attorney stated to the judge, \u201cAs you\u2019re aware, Crescent went into bankruptcy. The Crescent personnel were scattered to the winds. Their records are not obtainable.\u201d\nThe matters cited by Ryerson fail to support a conclusion that Crescent was bankrupt and had no interest in the suit; therefore, Ryerson has failed to distinguish Burns on that ground. Corrigan\u2019s affirmative defense and the affidavit of Corrigan\u2019s vice-president merely state that Crescent breached or became unable to perform, not that Crescent became bankrupt. The argument of Ryerson\u2019s attorney does not constitute evidence. Finally, the deposition testimony of the architect that at some undetermined time \u201cCrescent was in the process of going bankrupt\u201d does not indicate that Crescent indeed ever was involved in bankruptcy proceedings. Thus, without expressing an opinion as to whether a subcontractor\u2019s bankrupt status would render the subcontractor nonnecessary in a suit by its material supplier, we simply conclude that there is no support in this record for a finding that Crescent was, in fact, bankrupt at any time. We agree with Ryerson\u2019s counsel, who, in oral argument, conceded that if Crescent was not bankrupt or judgment proof, then Crescent was in fact a necessary party. Parenthetically, we note that in Christy v. Nabholz Supply Co. (1977), 261 Ark. 127, 546 S.W.2d 425, and in Rasmussen v. Reed (1974), 255 Ark. 1064, 505 S.W.2d 222, the Arkansas Supreme Court held that the bankruptcy of a necessary party did not excuse the failure to name him in the suit. Cf. Gipson v. Tyson Foods, Inc. (1981), 272 Ark. 485, 615 S.W.2d 363 (failure to name bankrupt necessary party excused where bankruptcy court enjoined action against the bankrupt).\nIn addition to failing to distinguish Burns, Ryerson fails to address the fact that its contract with Crescent to supply materials provides the relation through which it claims its lien against the defendants. (Burns, 148 Ill. App. at 366.) Instead, Ryerson argues that Burns silently has been \u201csuperseded\u201d by a more recent line of cases, citing Atlee Electric Co. v. Johnson Construction Co. (1973), 14 Ill. App. 3d 716, 303 N.E.2d 192, Malkov Lumber Co. v. Serafine Builders, Inc. (1971), 1 Ill. App. 3d 543, 273 N.E.2d 654, Bingaman v. Dahm (1940), 307 Ill. App. 432, 30 N.E.2d 509, Matot v. Barnheisel (1918), 212 Ill. App. 489, and Howell v. Anderson (1912), 170 Ill. App. 14.\nRyerson relies principally on Bingaman, which declined to reverse a judgment for the plaintiff-lien claimant for nonjoinder of certain other potential lien claimants because the defendant failed to show that any of the other claimants were in fact unpaid at the time objection to their nonjoinder was made. Bingaman, however, is clearly distinguishable from this case. The nonjoined parties therein were outside the chain of contract between the plaintiff and the defendant, and, moreover, \u201cthe record show[ed] that the claims for lien, upon which the defendants base[d] their contention of omission of necessary parties, were unenforceable at the time objection was first raised by defendants.\u201d (Bingaman, 307 Ill. App. at 439.) Malkov Lumber Co. and Atlee Electric Co. likewise involved suits by material suppliers who were outside the chain of contract between the plaintiffs and defendants. In Matot, the owner-defendant claimed that the contractor should have joined its own subcontractors. That case would be in point if the defendants were claiming that Ryerson failed to sue its own subcontractors. Thus these holdings are inapposite to that in Burns and to the case before us. In Howell the appellate court affirmed a finding against the plaintiff who improperly joined the trustee in bankruptcy of the \u201cprincipal contractor.\u201d The court refrained from passing on the propriety of joining the bankrupt principal contractor. Ryerson is wrong when it says that Howell held \u201cthat an insolvent contractor lacking assets to pay anyone is not a necessary party to a mechanic\u2019s lien action.\u201d\nIn Capitol Plumbing & Heating Supply, Inc. v. Van\u2019s Plumbing & Heating (1978), 58 Ill. App. 3d 173, 373 N.E.2d 1089, the court held that a general contractor was a necessary party. It rejected the defendant\u2019s argument that Burns held that only a subcontractor was a necessary party. It did not express disapproval o\u00ed Burns.\nWe, therefore, adhere to the decision of John E. Burns Lumber Co. v. W.J. Reynolds Co. and hold that Ryerson\u2019s complaint should have been stricken for failure to name a necessary party. In view of our holding, it is unnecessary to pass on the defendants\u2019 alternative arguments.\nJudgment reversed.\nLaPORTA, P.J., and McNAMARA, J., concur.", "type": "majority", "author": "JUSTICE EGAN" } ], "attorneys": [ "Rosenthal & Schanfield, of Chicago (James M. Dash and Stephen P. Kikoler, of counsel), for appellants.", "Burke, Wilson & Mcllvaine, of Chicago (Leonard S. Shifflett and John W. Kalich, of counsel), for appellee." ], "corrections": "", "head_matter": "JOSEPH T. RYERSON AND SON, INC., Plaintiff-Appellee, v. MANULIFE REAL ESTATE COMPANY et al., Defendants-Appellants.\nFirst District (6th Division)\nNo. 1\u201489\u20143431\nOpinion filed November 26, 1990.\n\u2014 Rehearing denied January 24, 1991.\nRosenthal & Schanfield, of Chicago (James M. Dash and Stephen P. Kikoler, of counsel), for appellants.\nBurke, Wilson & Mcllvaine, of Chicago (Leonard S. Shifflett and John W. Kalich, of counsel), for appellee." }, "file_name": "0622-01", "first_page_order": 644, "last_page_order": 649 }