Title: Pizano v. Lacey & Assoc., LLC
Citation: 2016 OK 73
Docket Number: 
State: Oklahoma
Issuer: Oklahoma Supreme Court
Date: June 21, 2016

Pizano v. Lacey & Assoc., LLC Annotate this Case Justia Opinion Summary In 2012, Lacey & Associates, LLC, contracted with Everest Homes, LLC, to purchase a commercial building. In addition, Lacey and Everest executed an escrow agreement for the release of additional funds to Everest if the roof was replaced after title had transferred to Lacey. After title passed to Lacey, Everest entered into a contract with the Williams Group, a contractor, to replace the roof. The Williams Group then hired Andrea Pizano to remove the old roof and HVAC units, which service she performed. In early 2013, Pizano sued alleging the Williams Group did not pay the contractual amount of $11,085, as agreed by the two parties. She filed a mechanic's lien on Lacey's building one day before she filed her petition. The lawsuit sought judgment against the Williams Group in the amount of $11,085, plus interest. The Williams Group never filed an answer. The trial court thereafter entered a default judgment against the Williams Group, awarding Pizano $11,085, an attorney's fee of $2,500.00 and court costs of $461.81. Pizano then sought to foreclose her lien against Lacey and be awarded court costs and attorney fees. She requested that the property be sold to satisfy the judgment. Lacey answered and included a "Cross-motion for Summary Judgment," contending that the new roof leaked so badly that large barrels had to be placed inside the building to catch the water. Therefore, no party was entitled to be paid for the roof. Lacey also asserted that Pizano's motion should be denied because Lacey had no contract with Pizano, and also that the plaintiff failed to file the required pre-lien notice. The trial court granted Pizano's summary judgment motion in part, and denied Lacey's counter-motion for summary judgment. Lacey appealed and Pizano counter-appealed. The Court of Civil Appeals held that Pizano successfully preserved her subcontractor's lien, but found that genuine disputes of fact remained as to the amount owed to Pizano and the enforceability of the lien. The Supreme Court found that the Legislature intended amounts less than $10,000 to be exempt from pre-lien notice. Having provided such an exception, the wording of the applicable statute persuaded the Court that "if a claimant filed a claim of $10,085 without a pre-claim notice, the claim would be enforceable up to $9,999. We do not believe that the claim would be completely unenforceable if it exceeded that legislatively-approved amount by a mere $86." The trial court's order entitling Pizano to a reduced judgment amount of $9,999.00 and an award of attorneys' fees and costs was affirmed. This case was remanded to the trial court to issue a judgment consistent with the law as expressed in the Supreme Court's opinion. Read more Want to stay in the know about new opinions from the Oklahoma Supreme Court? Sign up for free summaries delivered directly to your inbox. Learn More › You already receive new opinion summaries from Oklahoma Supreme Court. Did you know we offer summary newsletters for even more practice areas and jurisdictions? Explore them here . PIZANO v. LACEY & ASSOCIATES, LLC 2016 OK 73 Case Number: 112538 Decided: 06/21/2016 THE SUPREME COURT OF THE STATE OF OKLAHOMA NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL. ANDREA ROSA PIZANO, Plaintiff/Appellee, v. LACEY & ASSOCIATES, LLC, Defendant/Appellant, and WW GROUP, LLC, 5W GROUP, LLC, MARK WILLIAMS, JONNY WILLIAMS, and JOHN DOE, Defendants, v. EVEREST HOMES, LLC, Third-Party Defendant. ON CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION IV ¶0 Lacey & Associates, LLC, defendant/appellant, purchased commercial real estate from Everest Homes, LLC, third-party defendant. In addition, Lacey contracted with Everest to replace the roof and HVAC units on the building Lacey purchased. Everest contracted with the Williams Group, defendants, to do the work, and the Williams Group hired Pizano, plaintiff/appellee, to remove the roof. When the Williams Group did not pay Pizano, Pizano filed suit and sought to foreclose on Lacey's property pursuant to subcontractor lien statutes. Lacey claimed it received no pre-lien notice as the statutes require. Lacey and Pizano filed motions for summary judgment. The trial court granted Pizano's motion, giving her a judgment in a reduced amount, and denied Lacey's motion. On appeal, the Court of Civil Appeals reversed the trial court's determination that 41 O.S.2011, § 142.6 requires subcontractors to file a pre-lien notice. This Court granted certiorari to review this case. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS IS VACATED; JUDGMENT OF THE DISTRICT COURT IS AFFIRMED AND THE CASE IS REMANDED TO THAT COURT. Ryan S. Wilson, HARTZOG CONGER CASON & NEVILLE, Oklahoma City, Oklahoma; Attorney for Appellant. Patrick H. Lane, Jack S. Dawson, MILLER DOLLARHIDE, P.C., Oklahoma City, Oklahoma; Attorneys for Appellee. WINCHESTER, J. ¶1 The issue is whether Andrea Rosa Pizano, plaintiff/appellee, was required to file a pre-lien notice pursuant to 42 O.S.2011, § 142.6, to perfect her mechanic's lien against the real property owned by Lacey & Associates, LLC, defendant/appellant. I. FACTS AND PROCEDURE ¶2 In 2012, Lacey & Associates, LLC, (Lacey), contracted with Everest Homes, LLC, (Everest), to purchase a commercial building. In addition, Lacey and Everest executed an escrow agreement on October 5, 2012, for the release of additional funds to Everest if the roof was replaced after title had transferred to Lacey. After title passed to Lacey, Everest entered into a contract with the Williams Group, a contractor, to replace the roof. The Williams Group then hired Andrea Rosa Pizano, (Pizano) to remove the old roof and HVAC units, which service she performed. On March 26, 2013, Pizano sued alleging the Williams Group did not pay the contractual amount of $11,085, as agreed by the two parties. She filed a mechanic's lien on Lacey's building one day before she filed her petition. The lawsuit sought judgment against the Williams Group in the amount of $11,085, plus interest. The Williams Group never filed an answer. The trial court thereafter entered a default judgment against the Williams Group on August 6, 2013, awarding Pizano $11,085, an attorney's fee of $2,500.00 and court costs of $461.81. Pizano then sought to foreclose her lien against Lacey and be awarded court costs and attorney fees. ¶3 On October 29, 2013,1 Pizano moved for summary judgment against Lacey, based on her judgment against the Williams Group. She asserted the judgment entitled her to foreclose the lien claimed against the building and premises owned by Lacey. She requested that the property be sold to satisfy the judgment. ¶4 Lacey and Associates, LLC, answered and included a "Cross-motion for Summary Judgment." The company responded that the new roof leaked so badly that large barrels had to be placed inside the building to catch the water. Therefore, no party was entitled to be paid for the roof. Lacey also asserted that Pizano's motion should be denied because Lacey had no contract with Pizano, and also that the plaintiff failed to file the required pre-lien notice pursuant to 42 O.S.2011, § 142.6. 2 ¶5 Pizano replied that because her work included only removing and disposing of the old roof, the roof's present condition was irrelevant to her lawsuit for foreclosure. She argued that 42 O.S.2011, § 142.6 did not require her to file a pre-lien notice because she did not fit the description of "Claimant" as defined in that statute. ¶6 On January 15, 2014, the trial court found there were no disputed material facts. It granted Pizano's summary judgment motion in part, and denied Lacey's counter-motion for summary judgment. The court found that § 142.6 required Pizano to provide pre-lien notice, and because she did not give notice, she was not entitled to a lien in the entire principal amount of her claim, that is, $11,085.00. The order continued that Pizano's failure to provide such notice nevertheless entitled her to a reduced judgment amount of $9,999.00, pursuant to 42 O.S.2011, § 142.6(B)(3)(b). The trial court ordered Lacey to pay that reduced amount, as well as attorneys' fees and costs to Pizano in the amount of $10,766.18. Lacey appealed and Pizano counter-appealed. On March 23, 2015, the Court of Civil Appeals, Division IV, held that Pizano successfully preserved her subcontractor's lien, but found that genuine disputes of fact remained as to the amount owed to Pizano and the enforceability of the lien. The Court of Civil Appeals reversed and remanded the case for further proceedings. II. ANALYSIS OF THE RELEVANT STATUTES ¶7 In its petition for writ of certiorari, Lacey argues that the Court of Civil Appeals erred in holding that subcontractors are not required to give a pre-lien notice to property owners in order to assert their lien status. This issue has never been decided by this Court. ¶8 The requirement for a pre-lien notice is found in 42 O.S.2011, § 142.6. Section 142.6 requires a subcontractor to file a pre-lien notice only if that person fits within the definition of a "Claimant" found in subsection (A)(1) and (A)(2) of that statute. A "Claimant" is a "Person," other than an original contractor, who is entitled to a lien pursuant to 42 O.S.2011, § 141.3 Section 141 provides in pertinent part, "Any person who shall, under oral or written contract with the owner of any tract or piece of land, perform labor . . . on said land for the erection, alteration or repair of any building, improvement or structure thereon . . . shall have a lien upon the whole of said tract or piece of land, the buildings and appurtenances. If the title to the land is not in the person with whom such contract was made, the lien shall be allowed on the buildings and improvements on such land separately from the real estate." [Emphasis added.] For Lacey to be entitled to pre-lien notice, Pizano must be entitled to a lien pursuant to 42 O.S.2011, § 141. Pizano falls within the definition of "Claimant" because under § 141, she is a person, who is not the original contractor, and she did not have a contract with the owner of the property, Lacey & Associates, LLC. Had she filed a pre-lien notice § 141 would restrict Pizano's right to a lien only against the buildings and improvements of the property separately from the real estate, because she contracted with the Williams Group to perform labor, and that entity was not the owner of the land. ¶9 Lacey cites Jones v. Purcell Investments, 2010 OK CIV APP 15, 231 P.3d 706 , to demonstrate the conflict between Division IV and Division I of the Court of Civil Appeals. The issue in the Jones case involved the timing of the required pre-lien notice pursuant to § 142.6(B).4 Division IV observed that the Jones court assumed that a pre-lien notice was required by a subcontractor under that statute, without analysis of the validity of that assumption. But that assumption is based on sound reasoning. ¶10 The Jones court identified the policy behind a pre-lien notice: "Oklahoma law protects property owners by requiring subcontractors to give owners notice of mechanics' liens, which allows owners to withhold payment to the general contractor until they are sure the subcontractor will be paid by the general contractor."5 ¶11 Pursuant to § 142.6, a claimant is required to send the original contractor and the owner of the property pre-lien notice, prior to filing a lien statement under § 143.1,6 but no later than 75 days after the last date of the supply of materials, services, or labor. Today's holding, that the statutes cited above do require § 142.6(A)(1) claimants to file a pre-lien notice, has been anticipated in Jones, and 5A Vernon's Okla. Forms 2d, Real Estate 12.3 (2012 ed.), which states: "Pursuant to the specific and/or incorporating language of § 142.6 regarding §§ 141, 142 and 143, the prerequisites of § 142.6 seemingly applies to original contractors, laborers and materialmen, and subcontractors. Oklahoma decisional law specifically applies prelien notice requirements of § 142.6 to subcontractors." Volume 9 Okla. Prac., Construction Law § 6:6 (2014 ed.), regarding § 142.6 agrees: "Section 142.6 imposes a pre-lien notice requirement on persons 'other than an original contractor.' The pre-lien notice must be filed prior to the filing of the lien statement, but no later than 75 days after the last date of supply of material, services, labor or equipment in which the claimant is entitled to lien rights." [Emphasis in original; footnotes omitted.] ¶12 Because § 141 applies to Pizano, then § 142.6 applies as well. Section 142.6(B) explicitly specifies that the requirements within that statute apply before filing § 143.1 lien statements. "Prior to the filing of a lien statement pursuant to Section 143.1 of this title.the claimant shall send to the last known address of the original contractor and an owner of the property a pre-lien notice pursuant to the provisions of this section." 42 O.S. 2011, § 142.6(B). ¶13 The exception to the pre-lien requirement provided in 42 O.S.2011, § 142.6(A)(3)(b), allows a lien claim to be enforced without a pre-lien notice for claims when the aggregate amount of the claim is less than $10,000. Under subsection D, "[f]ailure by the claimant to comply with the pre-lien notice requirements of this section shall render that portion of the lien claim for which no notice was sent invalid and unenforceable." 42 O.S.2011, § 142.6(D). Pizano's claim exceeded $10,000. ¶14 We can infer from the exception cited in the above paragraph that the Legislature intended amounts less than $10,000 to be exempt from pre-lien notice. Having provided such an exception, the wording persuades this Court that if a claimant filed a claim of $10,085 without a pre-claim notice, the claim would be enforceable up to $9,999. We do not believe that the claim would be completely unenforceable if it exceeded that legislatively-approved amount by a mere $86. ¶15 The judgment of the trial court finding that Pizano failed to file pre-lien notice as required by law is affirmed. The trial court's order entitling her to a reduced judgment amount of $9,999.00 and an award of attorneys' fees and costs is affirmed. This case is remanded to the trial court to issue a judgment consistent with the law as expressed within this opinion. CERTIORARI PREVIOUSLY GRANTED; OPINION OF THE COURT OF CIVIL APPEALS IS VACATED; JUDGMENT OF THE DISTRICT COURT IS AFFIRMED AND THE CASE IS REMANDED TO THAT COURT. CONCUR: REIF, C. J., COMBS, V.C.J., KAUGER, WATT, WINCHESTER, EDMONDSON, TAYLOR, and GURICH, JJ. DISSENT: COLBERT, J. FOOT