Opinion ID: 2619544
Heading Depth: 1
Heading Rank: 8

Heading: Error in Refusing to Invalidate Lien Claim

Text: Appellant insists § 29-11, W.S. 1957, C. 1967, which provides that every person seeking to obtain the benefits of the lien statutes shall within the prescribed time file with the county clerk a just and true account of the demand due him    after all just credits shall have been given, requires at the least that a reasonably accurate account of the amount due be stated. Appellant further points out that § 29-19, W.S. 1957, C. 1967, a statute unique to Wyoming and not existing in Missouri, although stating that the inclusion of charges not properly within the account shall not invalidate the lien provides, [the claimant] may omit any and all such charges incorrectly entered or entered by mistake, and may proceed to enforce a lien for the balance, which last-mentioned clause by fair interpretation places an obligation upon the claimant to eliminate incorrect items at the time suit to enforce the lien is filed. Counsel contend that the gross and intentional overstatement by inclusion of lienable and nonlienable items cannot be equated with good faith and therefore the lien must fail in its entirety. A number of cases are cited on the general principle but reference to one, which is typical and on which perhaps greatest reliance is placed, is ample to resolve the point when it makes clear the importance of intention in any discussion of the problem: It is generally recognized that a lien statement may be regarded as `just and true', so as not to vitiate the entire lien, even if it contains mistakes or errors of omission, and includes nonlienable items of charge, if those inaccuracies of fact are unintentional and are the result of honest inadvertence, accident, or oversight, and do not result from deliberate intention or design.    On the other hand, it is equally fundamental doctrine that when nonlienable items are included in a lien statement deliberately, knowingly and intentionally, `then the account so filed may not be regarded as just and true within the meaning of the statute, and can form no basis for the adjudication and establishment of a lien for any part of the account.' Reese v. Hoyer, Mo. App., 95 S.W. 2d 884. Putnam v. Heathman, Mo. App., 367 S.W.2d 823, 828-829. For the present, it is not requisite to determine whether § 29-19 would alter the rule in the Putnam case, but even assuming arguendo that it would not, this aspect of the appeal turns not on a rule of law but rather upon the correctness of the court's finding of fact. Referring to the True Account of Demand for Labor and Materials Lien filed by Martin and Luther, the court minimizes the account's incorrectness, saying: The lien claim filed by Martin & Luther contains some errors and improper charges and is not letter perfect. The lien claim represents the total of hundreds of individual back-up items. Accountants of both parties spent weeks prior to trial examining the lien claim and supporting data. Some of these same accountants produced extensive testimony in almost five weeks of trial. Considering the complicated nature of the accounting problem, it is understandable that some errors would appear in the lien claim and some improper entries would be included. Notwithstanding the casual reference to errors and improper charges of the claimant, the memorandum opinion subsequently listed the following items as improper: Tools, equipment, materials, and supplies wasted or not properly accounted for by Martin and Luther, including unreasonable idle time for rented equipment and improper equipment rental charges $10,000.00 Officers' salaries and other salaries charged by Martin and Luther for work performed prior to its arrangements with Willamette for the Jackson work 1,136.75 Officers' salaries in connection with tramway job 3,598.75 Travel expenses 1,120.86 Air travel 1,123.50 Telephone charges 1,205.54 Trailer house for Martin and Luther's superintendent and office supplies 726.59 Overcharge for crane rental 1,209.50 Salary of Sam Sherrard earned after he left job 557.50 Lamb credit not extended to Willamette 541.89 Overcharge for profit and overhead 3,544.80 __________ TOTAL $24,765.38 These amounts are in addition to the deletion as improper charges of $5,430.13 by stipulation of plaintiff's counsel after evidence had been introduced to question the claims. United maintains that the burden to establish good faith is upon the claimant in the face of an overstatement which is a gross exaggeration, citing E.S. Gaynor Lumber Co. v. Morrison, 75 S.D. 132, 60 N.W.2d 83; and we recognize Sacchetti v. Recreation Co., 304 Mich. 185, 7 N.W.2d 265; Currier Lumber Co. v. Ruoff, 298 Mich. 505, 299 N.W. 163, to a similar effect. Although at first blush the court's holding that due to the large amount involved and the complicated nature of the accounting problem the errors in claimant's account were understandable would seem inconsistent with the subsequent elimination in the same opinion of the sum of $24,765.38 as nonlienable plus $5,430.13, which had been stipulated by claimant to be improper charges, the background of the transaction is integral to any determination. It must be remembered that the court early in its memorandum opinion had said, It is difficult    to understand why two experienced and apparently competent construction firms would enter into such a loose arrangement and rush headlong into the project without an adequate agreement and better preparation. Apparently in July, 1964, both parties were anxious to get started in Teton County, Wyoming. Willamette had a contract to construct the tramway and a deadline to meet. Martin & Luther had a contract to construct the Teton Lodge in the same area and had indicated to Willamette that generally they were `flat on work.' A careful reading of the record indicates the justification which the court had for such an observation and also that the owner's representatives were frequently on the job and fully cognizant of the situation. Under those circumstances the determination of what was properly lienable was far from a routine matter. We are mindful of counsel's argument that this facet of the appeal turns on the legal effect of the court's finding rather than the correctness of the finding. However, the two cannot well be divorced. All of this leaves us unwilling to say that the court erred in its finding of fact on this aspect in rejecting the claim of intentional wrongdoing by claimant and in refusing to invalidate the claim for gross overstatements knowingly made or that the legal effect of the finding was misinterpreted.