snrcxmz, nnmnson & HOWARD mon co. v. couucrt Brnrrs w. w. co. 15
water—works company is a guarantor only, and its contract is clearly col-
lateral to that of the construction company. In Marvin v. Sherman, 9
Iowa, 331, it is said: "A party who takes collateral security on the same
contract is not entitled to a ‘mechanic’s lien. This means either a sep-
arate obligation attached to the contract named, to guarantyits perform-
ance, or it may be the transfer of property, or of other contracts, to_in-
sure the performance of the principal agreement." In the present case,
the primary contract of payment is between the complainant and the
·const1°uction`c0mpany, and this contract is secured by the contract of
·guaranty entered into by the water·works company, and this constitutes
an agreement for collateral security within the meaning of the statute.
But if we adopt the view of the case urged in argument by complain-
-ant’s_ counsel, that in fact the construction company and the water-works
company were one and the same, then the point would be presented in
this wise: The complainant had contracted with the water-works com-
pany, through the agency of its double, for the furnishing of the mate-
rials in question, and the water-works company had in the original con-
tract bound itself to secure performance of its contract by depositing the
sum of $10,000 in the Commercial Bank of St. Louis, to be applied in
payment of any sum not promptly paid to complainant at the dates
named rin the contract. The evidence shows, thatethis sum Was ill fact
deposited withithe Commercial Bank of St. Louis, and was in fact used
in part- payment of theiindehtedness due to complainant for materials
furnished under the contract in question. ·If this does not amount to
contracting for and obtaining collateral security, within the meaning of
the Iowa statute, I cannot conceive how it would be ever possibleto show ·
rthat collateral security had been contracted for.- No other conclusion
can be reached than that the complainant, not being willing to. rely upon
rthe contract for payment entered into with the construction company,
required the additional security of a guaranty of payment by the water-
workscompany, and further required and obtained an actual deposit of
$10,000 forits benefit in the Commercial Bank-. By so doing,;it con-
itracted for`a11dreceived collateral security for the performance of the con-
~tract of purchase, and therebydefeated its right to claim a mechanics
‘ lien. V t V · . » 1 ;
· ` The decree must therefore befor a dismissal of the bill for want- of
vequity, without prejudice to complainantsriglit to proceed at law for
the sums due: _ · . I V » , . .