$14   v . . ‘ · FEDERAL REPOB.TER·‘ r   · ~
·ants,~such deposit would be the taking of, collateral security, and would
defeat the right to a mechanic’s lien according to the express provisions
' of section -2 of chapter 100 of the Acts of 16th General Assembly of the
state of Iowa. For a full statement of the case, and the conclusion
seached, see report of the case in 25 Fed. Rep. 170. In accordance with
leave granted, complainant a-mended the bill by averring that the water-
works companydid not deposit the sum of $10,000 provided for in the
contract, but that such deposit was made by the American Construction
Company; and the cause is now submitted on the pleadings and evi-
dence. ·—
The question is, did the complainant at the time of making the con-
tract for the sale and delivery of the materials, or during the progress
of the work in which the same were used, take collateral security on the
contract? If so, then, by the express declaration of the statute, the com-
plainant is not entitled to a lien. s r
Relying upon, the ruling of the supreme court of Iowa in Gilcrest v.
Gottschalk, 39 Iowa, 313, that "the taking of notes is not deemed the _
taking of collateral security, and that the taking of a mortgage from the
debtor upon the same indentical property covered by the mechanic’s _
` lien, and for thesame debt, cannot be deemed collateral security on the
same contract;."~and in Canstructimz O0. v. Railroad 00.,46 Iowa, 412,
- to the effect that an agreement to pay for the work done out of the money y
to be paid by the citizensof a county was not collateral security, but only
the designation of the source whence payment was to be ex·pected, there
~ being no assignment or transfer of the money; and in Bissell v._Lewls, 56
Iowa, 236, 9 N. W. Rep. 177, wherein it is held that, where "two pere
sons contract for the erection of a building on the land of one of them, it
‘ cannot be said thatcollateral security was taken on such contract/’-—coun~
sel for complainant have made a very ingenious argument in support of
l the proposition that collateral security was not takenby complainant upon
the contract for the delivery of the materials furnished and used in the
construction of the water-works at Council Bluffs; but the ingenuity of
the argument cannot change the facts of the case. I
’ Upon the face of the written contract, the primaryagreement of pur-
chase and sale of the materials to be furnished was in factbetween the
complainant and the American Construction Company; the latter com-
pany agreeing to pay the agreed prices at certain fixed dates, and the
water-works company, by the nfth section of the contract, agreeing “that
it does hereby guaranty the faithful performance bythe said construc-
tion company of all the obligations herein set forth, andall of the prog-
_ visions of this agreement; and to this end will and hereby agrees to de-
, _ posit, as security for the full performance of said obligation, _the sum of
- ten thousand dollars in the hands of the Commercial Bank of St. Louis,
the same tofbe applied to the payment to the said iron.; company of any
y such sum asthe said construction company; may fail topay jin the man-
ner herein. set forth,’?.etc. Upon the face of. it, this contract does not
vbind theconstruction company and the water-works_ company as princi-
pals,,,with'in.the rule in Bissell v. Lewis, supra. On theicontrary, the