Case Title: Desai v. A. R. Design Group, Inc.

Citation: 

Docket Number: 160814

State: virginia

Court: Virginia Supreme Court

Date: 2017-06-01T00:00:00Z

Document:
PRESENT:  Lemons, C.J., Goodwyn, McClanahan, Powell, Kelsey, and McCullough, JJ., and 
Millette, S.J. 
 
ULKA DESAI, EXECUTRIX OF THE ESTATE OF 
LAKSHMI DESAI, AND AS THE SUCCESSOR 
TRUSTEE OF THE REVOCABLE TRUST 
AGREEMENT OF LAKSHMI DESAI AS AMENDED 
 
 
 
 
OPINION BY 
v.  Record No. 160814 
JUSTICE STEPHEN R. McCULLOUGH 
 
 
 
June 1, 2017 
A. R. DESIGN GROUP, INC. 
 
 
FROM THE CIRCUIT COURT OF FAIRFAX COUNTY 
Robert J. Smith, Judge 
 
 
Ulka Desai challenges the validity of a mechanic’s lien filed by A.R. Design Group.  The 
trial court upheld the lien.  We conclude that the memorandum for mechanic’s lien either 
complied with the statute outright or was substantially compliant and, therefore, we affirm the 
judgment of the circuit court. 
BACKGROUND 
A.R. Design Group recorded a mechanic’s lien for work done on two properties.  The 
properties are both located in McLean, Virginia:  one is on Towlston Road, and the other is on 
Woodside Drive.  Both properties have been placed in a trust.  Lakshmi Desai originally served 
as trustee.  Following Lakshmi’s death, Lakshmi’s niece Ulka was named as trustee and she 
became trustee before the filing of the memorandum of mechanic’s lien. 
A.R. Design employed a form from the Virginia judiciary’s website, Form CC-1512, for 
its memoranda.  The memorandum for the Woodside Drive property identifies “Ulka D. Desai & 
Ulka D. Desai as executor of Estate of Lakshmi Desai” as the owner.  It does not specifically 
state that Ulka Desai is the trustee.  The memoranda for both the Woodside Drive and the 
Towlston Road liens were both signed by “Abbas Rouhani VP.”  Rouhani filled in the blank 
 
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space provided for the “claimant.”  A line is drawn through the blank space provided for the 
“agent” to sign.  Rouhani completed the affidavit as follows: 
 
Neither memorandum indicates a date from which interest is claimed or specifically 
states when payment is due.  The memoranda state that the “owner is justly indebted to the 
claimant in the sum of” $39,332.00 for work on the Woodside Drive property and $183,609.05 
for work on the Towlston Road property “for the consideration stated in the foregoing 
memorandum, and that the same is payable as therein stated.” 
Desai filed a petition challenging the validity of the liens.  Desai argues that the 
memoranda are defective for the following reasons: 
(1)  
For the Woodside Drive property, the failure to specifically name Desai as 
“trustee” constituted a fatal omission because, as a consequence, the memorandum never listed 
the owner of the property. 
(2)  
For both properties, the memoranda improperly identify Rouhani, who is an 
agent, as the claimant. 
(3)  
For both properties, the memoranda fail to list either a date from which interest is 
claimed or a date on which the debt is due. 
 
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The trial court sustained the validity of the liens.  This appeal followed. 
ANALYSIS 
 
Mechanic’s liens are creatures of statute.  Wallace v. Brumback, 177 Va. 36, 39, 12 
S.E.2d 801, 802 (1941) (citing Cain v. Rea, 159 Va. 446, 452, 166 S.E. 478, 480 (1932)).  We 
review de novo the trial court’s construction of the statutes at issue.  Eberhardt v. Fairfax Cnty. 
Emps. Ret. Sys., 283 Va. 190, 194, 721 S.E.2d 524, 526 (2012). 
 
Code § 43-3(A) provides in relevant part that 
[a]ll persons performing labor or furnishing materials of the value 
of $150 or more . . . for the construction, removal, repair or 
improvement of any building or structure permanently annexed to 
the freehold . . . shall have a lien, if perfected as hereinafter 
provided. 
 
A mechanic’s lien serves “to insure to . . . laborers the certain and speedy rewards of their labor, 
and to prevent the fruits of their daily toil, when matured, from being reaped by others.”  Merch. 
& Mech. Sav. Bank v. Dashiell, 66 Va. (25 Gratt.) 616, 621 (1874). 
Code § 43-4 specifies the steps necessary to perfect a mechanic’s lien:  when it must be 
filed, where to file it, and what must be included in the memorandum of mechanic’s lien.  As 
relevant to this appeal, Code § 43-4 requires the claimant to 
show the names of the owner of the property sought to be charged, 
and of the claimant of the lien, the amount and consideration of his 
claim, and the time or times when the same is or will be due and 
payable, verified by the oath of the claimant, or his agent. 
 
A number of other provisions also inform our analysis.  Code § 43-5 specifies that: 
[t]he memorandum and affidavit required by § 43-4 shall 
be sufficient if substantially in form and effect as follows: 
 
Name of owner:________________ 
  
. . . . 
5. 
Date from which interest on the above amount is 
 
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claimed: 
Date: __________________ 
 
. . . . 
Affidavit. 
State of Virginia, 
County (or city) of ____________________, to wit: 
I, ____________________ (notary or other officer) for the county 
(or city) aforesaid, do certify that ____________________ 
claimant, or ____________________, agent for claimant, this day 
made oath before me in my county (or city) aforesaid that 
____________________ (the owner) is justly indebted to claimant 
in the sum of _______________ dollars, for the consideration 
stated in the foregoing memorandum, and that the same is payable 
as therein stated. 
Finally, Code § 43-15 provides that 
No inaccuracy in the memorandum filed, or in the 
description of the property to be covered by the lien, shall 
invalidate the lien, if the property can be reasonably identified by 
the description given and the memorandum conforms substantially 
to the requirements of §§ 43-5, 43-8 and 43-10, respectively, and is 
not wilfully false. 
 
I. 
OMISSION OF THE WORD “TRUSTEE” IN SPECIFYING THE OWNER OF THE PROPERTY 
Code § 43-4 provides that the memorandum of mechanic’s lien must list “the names of 
the owner of the property sought to be charged.”  The memorandum for the Woodside Drive 
property states that the property is owned by “Ulka D. Desai & Ulka D. Desai as executor of 
Estate of Lakshmi Desai.” 
“Owner” is a word of general purport, but its primary meaning, 
as applied to land, is “one who owns the fee and who has the 
right to dispose of the property” and includes “one having a 
possessory right to land.” 
 
Loyola Fed. Sav. & Loan Ass’n v. Herndon Lumber & Millwork, Inc., 218 Va. 803, 805, 241 
 
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S.E.2d 752, 753 (1978) (quoting Black’s Law Dictionary 1259 (rev. 4th ed. 1968)).  
Furthermore, “a mechanic’s lien may be perfected on an equitable as well as on a legal estate.” 
Wallace v. Brumback, 177 Va. 36, 44, 12 S.E.2d 801, 804 (1941) (citing Feuchtenberger v. 
Williamson, 137 Va. 578, 583, 120 S.E. 257, 259 (1923)). 
Lakshmi Desai originally served as the trustee for the Woodside Drive property.  
Following Lakshmi’s death, Ulka D. Desai was appointed as the successor trustee in August of 
2015, approximately three weeks prior to the recording of the lien against the Woodside Drive 
property.  Legal title to the Woodside Drive property vested in Ulka D. Desai when she was 
appointed successor trustee.  See, e.g., Curtis v. Lee Land Trust, 235 Va. 491, 494, 369 S.E.2d 
853, 854 (1988).  The trust affords wide latitude to Desai as trustee, including the right to sell or 
encumber the property.  The memorandum properly identified Desai, as the trustee with legal 
title and the person holding the right to sell or encumber the property, as the “owner” of the 
property.  Adding the word “trustee” was not necessary for a valid memorandum of mechanic’s 
lien. 
Moreover, from a functional perspective, designating Ulka D. Desai as the owner 
satisfied the purpose of placing subsequent purchasers on notice of the mechanic’s lien.  See 
Wallace, 177 Va. at 44, 12 S.E.2d at 803.  A person purchasing the property from her would be 
on notice of the lien, which would be recorded under the general index of deeds under her name.  
As the appellee notes, the absence of the word “trustee” after her name would not have 
negatively impacted an index search. 
II. 
SIGNATURE ON THE LIEN 
Code § 43-4 requires that the memorandum must be “verified by the oath of the claimant, 
or his agent.”  Desai argues that Rouhani improperly signed the memoranda as a claimant rather 
 
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than as the agent of A.R. Design and, as a consequence, both memoranda are defective.  Desai 
points to our decision in Clement v. Adams Bros.-Paynes Co., 113 Va. 547, 553, 75 S.E. 294, 
296 (1912), where we held that the signature of the corporation’s president on an affidavit for a 
mechanic’s lien did not by itself suffice to establish that the president had the authority to act as 
the agent of the corporation.  The discrete issue addressed in Clement, however, is not before us 
here.1  Desai does not argue that Rouhani lacked the authority to act as an agent; rather, she 
argues that Rouhani incorrectly signed the memoranda as the claimant.  The question we must 
resolve is whether the memoranda containing Rouhani’s signature under the line reserved for a 
claimant rather than an agent, and his crossing out of the space reserved for the signature of an 
agent, means that that the memoranda are not substantially compliant under Code §§ 43-5 and 
43-15. 
Code § 43-5 provides that a memorandum “shall be sufficient if substantially in form and 
effect as follows.”  Code § 43-15 expressly provides that the lien will not be invalidated if the 
memorandum reasonably identifies the property by the description given and it “conforms 
substantially to the requirements of §§ 43-5, 43-8 and 43-10, respectively, and is not wilfully 
false.”  We have held that the word “inaccurate,” as used in Code § 43-15, is defined as ‘“not 
accurate:  as . . . containing a mistake or error:  incorrect, erroneous.”’  Reliable Constructors v. 
CFJ Props., 263 Va. 279, 281-82, 559 S.E.2d 681, 682 (2002) (quoting Webster’s Third New 
International Dictionary 1139 (1993)).  We have not defined what constitutes “substantially in 
form and effect” or “substantial conformity” in this context.  The word “substantial” simply 
                                                 
 
1 We note that Code § 49-7, enacted after our decision in Clement, provides in relevant 
part that “[a]n affidavit filed for a corporation or other entity may be made by its president, 
vice-president, general manager, cashier, treasurer, a director or attorney without any special 
authorization therefor.” 
 
 
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means “something of moment:  an important or material matter, thing, or part.”  Webster’s Third, 
at 2280.2  We hold that a defect in a memorandum of mechanic’s lien is substantial if it would 
prejudice a party or if it would thwart one of the purposes underlying the statute.3 
Desai does not argue that she was misled or confused in any way concerning who was 
claiming the lien, nor is there any argument that any statutory purpose would be thwarted.4  
Rouhani signed the memorandum as “VP,” a common abbreviation for vice-president.  The 
memorandum identified A.R. Design as the claimant.  The affirmation in the present case did not 
cause Desai any prejudice and it was sufficient to fulfill the purposes of the statute.  Accordingly, 
it is substantially compliant under Code § 43-5. 
III. 
FAILURE TO LIST THE DATES FROM WHICH THE INTEREST IS CLAIMED OR THE 
AMOUNT CLAIMED IS DUE AND PAYABLE 
 
 
Code § 43-4 states that the memorandum “shall show . . . the time or times when the 
                                                 
 
2 With respect to contracts, we have defined substantial compliance as a deviation from 
“the conditions of the contract . . . in trifling particulars not materially detracting from the benefit 
the other party would derive from a literal performance.”  Akers v. James T. Barnes of Wash., 
D.C., Inc., 227 Va. 367, 371, 315 S.E.2d 199, 201 (1984) (citation omitted).  This understanding 
of substantial compliance looks to the prejudice suffered by a party. 
 
 
3 Other courts have adopted a similar approach.  See, e.g., Northern Concrete Pipe, Inc., 
v. Sinacola Cos., 603 N.W.2d 257, 260-261 (Mich. 1999) (whether a mechanic’s lien is in 
substantial compliance with statutory requirements depends, among other things, on an 
examination of whether it satisfies the purposes of the statute and the potential for prejudice or 
unfairness); School Dist. v. A. G. Rushlight & Co., 375 P.2d 411, 414 (Or. 1962) (“The Oregon 
statute only requires notice ‘substantially’ as set out in the statute.  Whether or not the appellant 
has substantially complied with the statute should be determined largely by deciding whether or 
not the notice given performed the function intended.”); Mustang Tractor & Equip. Co. v. 
Hartford Accident & Indem. Co., 263 S.W.3d 437, 441 (Tex. Ct. App. 2008) (“In general, courts 
that have addressed substantial-compliance issues have distinguished between mere technical 
defects, which can be excused, and those defects that are more substantive in nature and, if 
overlooked, would read a provision out of the statute or prejudice another party.”). 
 
 
4 At the hearing on this matter, the plaintiff submitted as an exhibit a contract on behalf of 
A.R. Design signed by Alex Rouhani. 
 
 
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[amount] is or will be due and payable.”  Code § 43-4 does not contain a requirement that the 
memorandum state a “date from which interest on the above amount is claimed.” 
Code § 43-5, which sets forth a sample form for a memorandum of mechanic’s lien, lists the 
following requirement: 
5. 
Date from which interest on the above amount is claimed: 
Date: ____________ 
 
The form specified by Code § 43-5, however, does not contain a line item specifying that the 
memorandum state “the time or times when the [amount] is or will be due and payable.”   In 
other words, Code § 43-4 and Code § 43-5 each contain an item that the other does not.  The 
Court’s official form CC-1512, which generally tracks Code § 43-5, did not contain a line, as 
does the statute, for a date from which interest is claimed.  Seizing on this incongruity, Desai 
contends that the memoranda here are defective because, first, they do not specify a date from 
which interest is claimed and, second, they do not provide a time or times when the amount is or 
will be due and payable. 
With respect to the interest, A.R. Design states that it is not claiming any interest.  A 
lienholder who is not claiming any interest does not fall within the plain language of Code 
§ 43-5.  The statute says that the memorandum must state the date on which the interest “is 
claimed.”  Code § 43-5.  A litigant who is not claiming any interest need not state anything on 
that topic.  Moreover, applying the substantial compliance standard of Code § 43-5, it is hard to 
imagine any prejudice to Desai – she actually gains the benefit of not having to pay any interest. 
The absence of a “time or times” when the amount “is or will be due and payable” 
presents a thornier question.  A lienor who wishes to file a memorandum of mechanic’s lien has 
a choice.  One option is to file a memorandum that tracks the requirements specified in Code 
§ 43-4.  Alternatively, a lienor can seek shelter under the provisions of Code § 43-5, which states 
 
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unambiguously that “[t]he memorandum and affidavit required by § 43-4 shall be sufficient if 
substantially in form and effect as follows.”  In turn, the contents of a memorandum specified by 
Code § 43-5 do not include a requirement that the memorandum must expressly list “the time or 
times when the [amount] is or will be due and payable.”  Code § 43-5 states that the 
memorandum should state that “the same is payable as therein stated.”  The affidavit here 
mirrors this language.  As A.R. Design points out, its memoranda stated that the sum listed was 
“payable as therein stated.”  The memoranda were signed on September 16, 2015.  Thus, the 
memoranda indicate that the amount is due and payable as of the date of the memoranda. 
We conclude that the memoranda were substantially compliant because they closely 
tracked the form required by Code § 43-5, they provided sufficient notice that the owner was 
claiming amounts due, and any defect in the memoranda would not thwart an underlying purpose 
of the statute, such as providing notice to third parties.  Therefore, A.R. Design is entitled to the 
safe harbor provided by Code § 43-5. 
Code § 43-4 specifies that the memorandum must specify “the time or times when the 
same is or will be due and payable.” (emphasis added).  The purpose of the “payable” language 
is to indicate whether the amounts are presently due or may become due in the future.  Section 
43-4 provides that, while a memorandum of lien should include only sums due for labor or 
materials furnished no more than 150 days prior to the filing of the memorandum, such lien may 
also 
include (i) sums withheld as retainages with respect to labor 
performed or materials furnished at any time before it is filed, but 
not to exceed 10 percent of the total contract price and (ii) sums 
which are not yet due because the party with whom the lien 
claimant contracted has not yet received such funds from the 
owner or another third party. 
 
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(Emphasis added.)  We have recognized that the language “the time or times when the [debt] is 
or will be due and payable” “simply contemplates the possibility that the payment due date (as 
distinguished from the delivery date) on materials furnished pursuant to the contract may 
post-date the filing of the memorandum of lien.”  American Standard Homes Corp. v. Reinecke, 
245 Va. 113, 119 n.1, 425 S.E.2d 515, 518 n.1 (1993) (alteration in original).  The wording of 
the memoranda was sufficient to alert Desai that A.R. Design was seeking amounts presently 
due, rather than amounts “not yet due.” 
Finally, Desai argues that the statute should be interpreted in a way that requires a 
memorandum to provide “the necessary preliminary information to quickly determine if a filed 
lien is valid.”  This contention does not find any support in the text of the statute.  We are not 
permitted, under the guise of judicial construction, to rewrite the plain language of a statute.  
Harbor Cruises, Inc. v. Commonwealth, 217 Va. 458, 461, 230 S.E.2d 248, 250 (1976).  We 
decline to read the statute in the manner Desai suggests. 
CONCLUSION 
 
We will affirm the judgment below. 
Affirmed.