Opinion ID: 1298264
Heading Depth: 5
Heading Rank: 3

Heading: The Context of Individual in Other Mechanics' Lien Sections

Text: We are supported in our conclusion concerning the meaning of the term individual by reference to the usage of that term in other sections of the lien law. Statutes relating to the same subject matter should be read together as a whole in order that a total scheme evolves which maintains the integrity of each act and avoids ignoring one or the other. Nash v. State, 679 P.2d 477, 478 (Alaska 1984); City of Anchorage v. Scavenius, 539 P.2d 1169, 1174 (Alaska 1975) (each part of a statute should be construed with every other part or section so as to produce a harmonious whole). Accordingly, both AS 34.35.117 and .095 are helpful in determining the meaning of the term individual as it is used in the lien law.
Alaska Statute 34.35.117 allows all claimants, except individuals, to waive lien and stop-payment notice rights: (a) Except as provided under (b) of this section a written waiver of lien or stop-payment notice rights created under AS 34.35.050-34.35.120 signed by a claimant requires no consideration and is valid and binding. A waiver permitted under this section may not relate to labor, materials, services or equipment furnished after the date the waiver is signed by the claimant. (b) An individual described in AS 34.35.120(10) may not waive right to claim a lien under AS 34.35.050-34.35.120. A waiver which purports to waive the lien rights of that individual or class or individuals is void. (Emphasis added.) Nystrom and Amicus argue that subsection (b) reflects a policy decision by the legislature to provide individual laborers with additional wage protection. This protection, they argue, is unnecessary for corporate contractors. They also assert that if the definition of individual includes contractors, AS 34.35.117(a) does not apply to anyone. Buckhorn did not respond to this argument. Alaska Statute 34.35.117 compels a finding that individual does not include contractors for the reasons presented by Nystrom. If Buckhorn is an individual, then all general contractors, including large, sophisticated contractors would lose the ability to waive their lien rights. Such a result is contrary to the intent of lien waivers  to help facilitate project financing. [28] The legislative history of AS 34.35.117 also supports a finding that individual does not include contractors. As explained above, the 1978 legislature enacted AS 34.35.117 as part of H.B. 739. Andrew Brown's March 21, 1978 memorandum informed Commerce Committee members that this statute would allow any claimant, except an individual laborer, to waive his lien or stop-payment notice rights... . Any attempted waiver by an individual laborer would be void. (Emphasis added.) The superior court's definition of individual proves unworkable when applied to AS 34.35.117.
Alaska Statute 34.35.095 governs the amount a claimant or individual may recover upon a lien: (a) Except as provided in (c) of this section, a claimant may recover upon a lien recorded by the claimant only the amount due to the claimant according to the terms of the contract, after deducting all claims of other persons claiming through the claimant for work done and materials furnished. (b) [Repealed] (c) An individual described in AS 34.35.120(10) may recover upon a lien recorded by the individual only the amount due according to the terms of the employment. (Emphasis added.) Nystrom and Amicus argue that the clear implication of the use of employment with individual is that individual refers only to natural persons who are employed. Contractors, on the other hand, are rarely, if ever, employed. Instead, contractors, like Buckhorn, enter into construction contracts. Buckhorn did not respond to this argument. A review of the history of AS 34.35.095 confirms Nystrom's position. Prior to the extensive legislative amendments to the mechanics' lien statutes in 1978, AS 34.35.095 read: A contractor may recover upon a lien filed by him only the amount due to him according to the terms of his contract, after deducting all claims of other persons for work done and materials furnished. (Emphasis added.) This version of AS 34.35.095 had been interpreted not to apply to subcontractors and materialmen because they were not in contractual privity with the owner. Clay v. Sandal, 369 P.2d 890 (Alaska 1962); Moores v. Alaska Metal Bldgs., Inc., 448 P.2d 581, 583 (Alaska 1968). For this reason, the recovery of subcontractors and materialmen was limited to the reasonable value of performance, not the contract price. Moores, 448 P.2d at 583; see also Blum, § 4.2.3.a, at 124. The 1978 amendments to AS 34.35.095, set forth below, inserted the underlined terms in subsection (a) and added subsections (b) and (c): (a) A prime contractor [29] may recover upon a lien recorded [filed] by him only the amount due to him according to the terms of his contract, after deducting all claims of other persons claiming through him for work done and materials furnished. (b) A claimant other than a prime contractor or an individual described in [sec.] 120(10) of this chapter may recover upon a lien recorded by him an amount not to exceed that portion of the unpaid contract price attributable to labor, materials, services or equipment furnished... . (c) An individual described in [sec.] 120(10) of this chapter may recover upon a lien recorded by him only the amount due to him according to the terms of his employment. Application of Buckhorn's definition of individual to the current and 1978 version of AS 34.35.095 leads to absurd results. As an individual Buckhorn could recover an amount based upon the terms of its employment without deducting the claims of other persons claiming through it  as required by subsection (a). This result is unwarranted and unintended.