Allen Estate Ass'n. v. Boeke

In Allen Estate Ass'n. v. Boeke, 300 Mo. 575, 254 S.W. 858, 860-861 (Mo. 1923), lessor leased the property for ninety-nine years to lessee. Provisions in the lease included, inter alia, (1) that lessee make alterations and improvements making the building suitable for hotel and commercial purposes; (2) that the plans and specifications for the proposed alterations were subject to the approval by the lessor; (3) that no provision in the lease whether requiring or authorizing the lessee to make improvements, alterations, or repairs shall be construed to constitute the lessee the agent of the lessor; and (4) that all persons providing labor or furnishing materials for improvements or alterations made to the leased premises shall look solely to the lessee for payment or for the enforcement of any liens against the lessor's interest in the property. Allen Estate Ass'n. 254 S.W. at 859-862. Section 7216 of Missouri's mechanic's lien statute provides in pertinent part that: Every mechanic or other person, who shall do or perform any work or labor upon, or furnish any material, fixtures, engine, boiler or machinery for any building, erection or improvements upon land, or for repairing the same, under and by virtue of any contract with the owner or proprietor thereof, or his agent, trustee, contractor or subcontractor . . . shall have . . . a lien. Id. at 860. The court held that notwithstanding the negative covenant in the lease, the lessee was the agent of the lessor in making the improvements. Id. In its analysis, the court stated that the lessor's reversionary interest was enhanced by the improvements made to the property, in a substantial manner that would entitle the mechanic's to a lien on the property. Id. Further, the court stated: While it is true that a tenant, as such, is not the agent of the owner to the extent that he may establish a lien against the land of the owner for improvements made by the tenant for his own benefit and at his own costs, nevertheless, if it appears that the owner has obligated the tenant to construct permanent and substantial improvements on the property beneficial to the reversionary interest of the owner, those furnishing labor or material for such improvements by virtue of contracts with the tenant have a right to mechanics' liens against the reversionary interest of the owner in the property improved. Id. at 862. The Court also stated: While the lease should, if such connection exists, sufficiently disclose the lessor's finger prints of same, it is not upon this instrument alone, however, but to all the facts connected with the transaction, that we may look in determining whether a connection in the nature of an agency exists between the parties and as a consequence the right of the respondents to the liens.