Title: GENERAL ELECTRIC SUPPLY CO v BENN

State: montana

Issuer: Montana Supreme Court

Document:

No. 80-283 IN THE SUPREME COURT OF THE STATE OF MONTANA GENERAL ELECTRIC SUPPLY COMPANY, DIVISION OF GENERAL ELECTRIC COMPANY, A CORPORATION, Plaintiff and Appellant, GARY V . BENNETT and HAROLD E. GERKE, et al. , Defendants and Respondents. Appeal from: District Court of the Thirteenth Judicial District, In and for the County of Yellowstone, Montana Honorable Diane Barz, Judge presiding. Counsel of Record: For Appellant: Fred N. Dugan, Billings, Montana For Respondents: Stacey & Jarussi, Billings, Montana Submitted on briefs: January 8, 1981 Decided: April 15, 1981 Filed: BQR 1.5 1981 I I I Y P Clerk M r . J u s t i c e Fred J. Weber delivered t h e Opinion of t h e Court. P l a i n t i f f General E l e c t r i c Supply Company (General E l e c t r i c ) appeals from t h e order and judgment entered by t h e D i s t r i c t Court of t h e Thirteenth J u d i c i a l D i s t r i c t , Yellowstone County, granting summary judgment t o t h e defendants (owners) a f t e r cross-motions f o r summary judgment had been made. The order and judgment i n v a l i d a t e General E l e c t r i c ' s mechanic's l i e n on c e r t a i n property of t h e defendants. The s o l e i s s u e involved i n t h i s appeal i s one of law: Is t h e d e s c r i p t i o n of t h e s u b j e c t property, which d e s c r i p t i o n i s contained i n t h e n o t i c e of l i e n f i l e d with the county c l e r k and recorder, l e g a l l y s u f f i c i e n t t o i d e n t i f y t h e property f o r purpose of enforcing t h e l i e n ? W e hold t h a t t h e order and judgment of t h e D i s t r i c t Court should be reversed, and summary judgment should be entered i n favor of a p p e l l a n t General E l e c t r i c . The appeal has been submitted on an agreed statement of f a c t s . The quotes which appear i n t h e following d e s c r i p t i o n of f a c t s a r e taken from t h a t agreed statement. The owners caused a building t o be constructed on t h e i r following-described property: The South 90 f e e t of Lot - 9 , Block 1, of Valley V i e w Acres Subdivision, i n the C i t y of Bill-ings, Yellowstone County, Montana. General E l e c t r i c sold e l e c t r i c a l s u p p l i e s t o the e l e c t r i c a l subcontractor on t h e job. O n February 23, 1978, and within 90 days a f t e r t h e l a s t of t h e e l e c t r i c a l m a t e r i a l s was supplied, General E l e c t r i c f i l e d a n o t i c e of i t s mechanic's l i e n with t h e county c l e r k and recorder. "The n o t i c e s t a t e s t h a t t h e reputed owners of t h e lands and premises and t h e o f f i c e building lo- cated thereon w e r e Gary V. Bennett and Harold E. Gerke, d/b/a Bennett & Gerke, t h a t t h e reasonable value of the building m a t e r i a l s furnished by claim- a n t was i n t h e sum of $14,173.37, and t h a t t h e property t o be charged with t h e l i e n i s the ' o f f i c e building' located on Lots 7 and 8 i n Block 1 of Valley View Acres Subdivision and t h e lands 'here- inbefore described on which s a i d building is s i t u - a t e d ' . The invoices attached a s e x h i b i t s t o t h e n o t i c e each r e f e r r e d variously t o t h e a p p l i c a b l e charges a s f o r : 'Bennett Office Building'; 'Bennett O f f i c e ' ; 'Bennett'; o r 'Bennetts'. A s emphasized above, the building was a c t u a l l y located on Lot 9 n o t Lots 7 and 8." Agreed Statement i n Lieu of Record on Appeal, p. 2. Thereafter a portion of the s u p p l i e s was returned t o General E l e c t r i c unused. The remaining s u p p l i e s , i n t h e amount of $10,586.18, were a c t u a l l y used i n t h e construction of t h e building. The owners s u b s t i t u t e d t h e i r bond i n t h e remaining amount so a s t o discharge t h e l i e n on t h e property. " S u i t on the bond i n t h e manner of f o r e c l o s u r e of Mechanic's Lien b u t r e c i t i n g t h e s u b s t i t u t i o n of t h e bond was commenced on February 7, 1979 naming a s defendants t h e owners, t h e prime c o n t r a c t o r , t h e subcontractor and t h e bonding company . . . A f t e r t h e f i l i n g i n bankruptcy by t h e subcontractor, h i s t r u s t e e i n bankruptcy was s u b s t i t u t e d i n h i s place and d e f a u l t w a s entered a g a i n s t t h e t r u s t e e . The defendant owners answered counterclaiming f o r t h e c o s t of t h e i r bond premium and cross-complaining a g a i n s t t h e prime c o n t r a c t o r , Mora, f o r any judgment p l a i n t i f f might s u s t a i n . . . [Tlhe i s s u e s con- cerning Mora, t h e prime c o n t r a c t o r were severed f o r consideration a f t e r t r i a l o r determination of t h e i s s u e s between p l a i n t i f f and t h e defendant owners and bonding company on t h e i r r e s p e c t i v e mo- t i o n s f o r summary judgment." Agreed Statement i n Lieu of Record on Appeal, p. 3 . The owners and bonding company moved f o r summary judg- ment, and f i l e d a b r i e f i n support of t h e motion. General E l e c t r i c a l s o moved f o r summary judgment, and f i l e d a b r i e f and supporting a f f i d a v i t s . The owners d i d n o t f i l e any a f f i d a v i t s i n support of t h e i r own motion, and d i d n o t f i l e a f f i d a v i t s o r a b r i e f i n opposition t o General E l e c t r i c ' s motion. "The matter was then submitted t o t h e Court upon c r o s s motions f o r summary judgment. Thereafter t h e Court entered i t s Order granting t h e defendants' motion f o r summary judgment and denying p l a i n t i f f ' s motion. A pre-judgment hearing was held i n which due proof was made of defendants damages by way of bond premium c o s t and of t h e reasonable value of t h e i r a t t o r n e y ' s f e e s , whereupon summary judgment f o r t h e defendants was entered from which t h i s appeal i s taken." Agreed Statement i n Lieu of Record on Appeal, pages 4-5. This appeal i s taken upon cross-motions f o r summary judgment. W e agree t h a t t h e r e is no genuine i s s u e a s t o any m a t e r i a l f a c t , b u t w e hold t h a t t h e D i s t r i c t Court e r r e d i n g r a n t i n g summary judgment t o the owners. General E l e c t r i c i s e n t i t l e d t o a judgment a s a matter of law, and n o t t h e owners. Rule 5 6 ( c ) , M.R.Civ.P. Section 71-3-511(1), MCA, p r e s c r i b e s t h e necessary s t e p s t o be followed i n acquiring a mechanic's l i e n : "How t o p e r f e c t l i e n . (1) Every person wishing t o a v a i l himself of t h e b e n e f i t s of t h i s p a r t must f i l e , with t h e county c l e r k of the county i n which t h e property o r premises mentioned i n 71-3-501 i s s i t u - a t e d and within 90 days a f t e r t h e m a t e r i a l o r machin- e r y a f o r e s a i d has been furnished o r t h e work o r l a b o r performed, a j u s t and t r u e account of t h e amount due him, a f t e r allowing a l l c r e d i t s , containing a c o r r e c t d e s c r i p t i o n -- of t h e property - - - t o be charged wigh -- such l i e n , v e r i f i e d by a f f i d a v i t , -- b u t any e r r o r o r mistake i n t h e account or d e s c r i p t i o n does n o t a f f e c t t h e -- -- v a l i d i t y ----- of t h e l i e n i f the property -- can be i d e n t i f i e d by t h e d e s c r i p t i o n . The paper containing t h e account, -- d e s c r i p t i o n , and a f f i d a v i t i s deemed t h e l i e n . When t h e r e i s an open account between t h e p a r t i e s f o r l a b o r , m a t e r i a l , o r machinery, such l i e n may be f i l e d within 90 days a f t e r t h e d a t e of t h e l a s t i t e m i n such ac- count and include a l l items and charges contained t h e r e i n f o r m a t e r i a l o r machinery furnished f o r , o r work performed on, t h e property on which t h e l i e n i s claimed." (Emphasis added.) The above s t a t u t e and i t s emphasized p o r t i o n have been construed by t h i s Court many t i m e s . This Court has uniformly held t h a t t h e requirements of the mechanic's l i e n s t a t u t e s a s t o procedure w i l l be s t r i c t l y enforced. Once t h e procedure has been f u l f i l l e d , t h e s t a t u t e s w i l l be l i b e r a l l y construed so a s t o give e f f e c t t o t h e i r remedial character. Federal Land Bank of Spokane v. Green (1939), 108 Mont. 56, 62-63, 90 P.2d 489, 491-492; Western Iron Works v. Montana Pulp & Paper Co. (1904), 30 Mont. 550, 558, 77 P. 413, 416. The property t o be described and t o which t h e l i e n a t - taches is t h e building o r improvement i t s e l f . ~ a r c o - ~ r u d e n v. Nelson (1979), - Mont. , 593 P.2d 48, 50, 36 St.Rep. 704, 706. Based upon t h e above-stated r u l e of l i b e r a l construction, t h i s Court has held t h a t " i f t h e d e s c r i p t i o n of t h e building i t s e l f i s s u f f i c i e n t t o enable a person f a m i l i a r with t h e l o c a l i t y t o p o i n t it o u t a s the only one corresponding with the d e s c r i p t i o n contained i n t h e l i e n , it m e e t s a l l t h e requirements of the s t a t u t e . . . I ' Varco- Pruden v. Nelson, supra; Midland Coal & Lumber Co. v. Ferguson (19211, 61 Mont. 402, 405, 202 P. 389, 390. I n seeking t o determine i f a p a r t y f a m i l i a r with t h e l o c a l i t y can i d e n t i f y t h e property from t h e d e s c r i p t i o n , "whether a given d e s c r i p t i o n i s s u f f i c i e n t o r n o t depends upon the surrounding circumstances, t h e c h a r a c t e r of t h e p a r t i c u l a r building, i t s s i t u a t i o n with reference t o o t h e r s , e t c . " Midland - - Coal & Lumber - Co., 61 Mont. 406, 202 P. 390. Although t h e s t a t u t e s extend the l i e n on the s t r u c t u r e t o t h e land i t s e l f , t h e land need n o t be described. Section 71-3-514, MCA; Federal --- Land Bank of Spokane, 108 Mont. 64, 90 P.2d 492. Often, a d e s c r i p t i o n of t h e land i s included so a s t o f u r t h e r i d e n t i f y t h e p a r t i c u l a r s t r u c t u r e . Morrison- Mont. Maierle, Inc. v. Selsco (19801, - - , 606 P.2d 1085, 1087, 37 St.Rep. 299, 301; Midland - - Coal & Lumber - Co., 61 Mont. 405, 2 0 2 P. 390; Western I r o n Works, 30 Mont. 556, 77 P. 416. I n cases where t h e l e g a l d e s c r i p t i o n of the land con- tained e r r o r s , t h i s Court s t a t e d t h a t " i f , by r e j e c t i n g what i s erroneous i n t h e d e s c r i p t i o n contained i n the l i e n , enough remains t o i d e n t i f y t h e p a r t i c u l a r property sought t o be charged, t h e l i e n w i l l be upheld." Caird ~ n g i n e e r i n g Works v. Seven U p Gold Mining Co., Inc. (1941), 1 1 1 Mont. 471, 479, 1 1 1 P.2d 267, 272; Midland Coal & Lumber Co. v. Ferguson, supra. Under the s t a t u t e s , the accounts and statements f i l e d with t h e n o t i c e of l i e n form p a r t of t h e l i e n i t s e l f , and can be used f o r f u r t h e r a i d i n i d e n t i f y i n g the building sought t o be charged. Section 71-3-511(1), MCA; Morrison-Maierle, Inc. v. Selsco, supra; Federal Land Bank of Spokane, 108 Mont. --- 63-64, 90 P.2d 492. The purpose of r e q u i r i n g n o t i c e of t h e l i e n t o be f i l e d i s t o p r o t e c t a l l p a r t i e s dealing with t h e property, including innocent t h i r d p a r t i e s and subsequent purchasers. Morrison- Maierle, Inc. v. Selsco, supra; Western I r o n Works, 30 Mont. -- 557, 77 P. 416. This Court w i l l construe t h e adequacy of t h e d e s c r i p t i o n more s t r i c t l y a g a i n s t t h e l i e n claimant where t h i r d p a r t i e s a r e involved than where only t h e owners themselves a r e involved: "The same r u l e of construction would c e r t a i n l y not apply i n a c a s e where t h e r e s u l t a f f e c t e d t h e in- t e r e s t of an innocent purchaser f o r value, whose r i g h t s might have been prejudiced by a lack of f u l l d e s c r i p t i o n , and one which a f f e c t e d only t h e i n t e r e s t of t h e owner whose land has been enhanced i n value by t h e l i e n claimants, and who i s presumed t o know i t s location." Caird Engineering Works v. Seven U p Gold Mining Co., supra, 1 1 1 Mont. 481, 1 1 1 P.2d 273. See a l s o Blose v. Havre O i l & Gas Co. (1934), 96 Mont. 450, 466-467, 31 P.2d 738, 744. Turning now t o t h e f a c t s of t h i s appeal, we note f i r s t t h a t only the l i e n claimant and t h e owners of t h e property a r e involved. N o t h i r d p a r t y has been misled t o h i s d e t r i - ment by t h e i n c o r r e c t d e s c r i p t i o n . Therefore, t h e owners' argument t h a t t h i r d p a r t i e s might have been misled i s unper- suasive, and t h e owners themselves could n o t have been misled by t h e i n c o r r e c t d e s c r i p t i o n . The n o t i c e of l i e n describes t h e s t r u c t u r e i t s e l f a s an " o f f i c e building" and t h e invoices attached a s e x h i b i t s d e s c r i b e it a s "Bennett Office Building", "Bennett Office", "Bennett", and "Bennetts" . Omitting the i n c o r r e c t p o r t i o n of t h e l e g a l d e s c r i p t i o n , t h e building i s described a s being located on Block 1 of Valley View Acres Subdivision i n B i l l i n g s , Yellowstone County, Montana. The following i s a p e r t i n e n t p o r t i o n of General E l e c t r i c ' s e x h i b i t "C" showing t h e l o c a t i o n of t h e l o t s i n question: The a f f i d a v i t s and photographs submitted i n evidence by General E l e c t r i c show only two commercial buildings on Block 1, t h e Royal Fork r e s t a u r a n t building (obviously n o t an o f f i c e building) and t h e Bennett o f f i c e building. This evidence i s n o t controverted o r r e b u t t e d by t h e owners, and Mont. i s t h e r e f o r e taken a s t r u e . Swecker v. Dorn (1979), - I 593 P.2d 1055,1058, 36 St.Rep. 844, 847. The uncontroverted evidence forms a proper b a s i s f o r summary judgment. Rule 56 (e) , M.R.Civ.P. Using only t h e c o r r e c t portions of the d e s c r i p t i o n con- tained i n General E l e c t r i c ' s n o t i c e of l i e n , and using t h e account statements which form p a r t of t h e l i e n f o r f u r t h e r a i d i n i d e n t i f i c a t i o n , t h e building s u b j e c t t o the l i e n i s described a s the "Bennett Office Building" located on Block 1 of Valley View Acres Subdivision of B i l l i n g s , Yellowstone County, Montana. Considering the uncontradicted evidence, it i s c l e a r t h a t a person f a m i l i a r with t h e l o c a l i t y could i d e n t i f y the property s u b j e c t t o t h e claim of l i e n . The d e s c r i p t i o n contained i n the n o t i c e of l i e n i s s u f f i c i e n t t o allow l i e n foreclosure. Any question i n t h i s regard i s eliminated by the presence of the owners a s t h e only p a r t i e s involved and t h e absence of innocent t h i r d p a r t i e s . W e reverse t h e judgment of t h e D i s t r i c t Court, and remand the case f o r e n t r y of judgment i n favor of General E l e c t r i c Supply Company. W e concur: Chief J u s t i c e \