Court Opinion

ID: 2685105
Source: CourtListenerOpinion
Date Created: 2014-07-22 15:14:45.241864+00
Date Added: 2024-06-11T13:14:43.781953
License: Public Domain

MAINE SUPREME JUDICIAL COURT                                         Reporter of Decisions
Decision: 2014 ME 93
Docket:   Ken-13-448
Argued:   June 11, 2014
Decided:  July 17, 2014

Panel:       SAUFLEY, C.J., and ALEXANDER, SILVER, MEAD, GORMAN, and JABAR, JJ.

                            THE COTE CORPORATION

                                          v.

                       KELLEY EARTHWORKS, INC., et al.

MEAD, J.

         [¶1] Kelley Earthworks, Inc. (Kelley), appeals, and The Cote Corporation

(Cote) cross-appeals, from an amended summary judgment entered by the Superior

Court (Kennebec County, Murphy, J.) awarding Cote a money judgment of

$29,990, plus interest and attorney fees, in satisfaction of a mechanic’s lien that the

court found Cote held on Kelley’s real property. Kelley contends that the court

erred in (1) granting summary judgment to Cote after Kelley did not respond to

either Cote’s complaint or its motion for summary judgment; (2) awarding interest

and attorney fees as part of the judgment; and (3) denying in part Kelley’s motion

for relief pursuant to M.R. Civ. P. 60(b), filed after the court entered a final

judgment in favor of Cote. Cote, citing 10 M.R.S. § 3265 (2013), contends that the

court erred in amending its original judgment by striking a provision ordering the

sale of Kelley’s real property to satisfy the mechanic’s lien and instead awarding a
2

money judgment. Because we agree that the court erred in striking the provision of

its order requiring a sale of the property, we vacate the judgment and remand for

entry of an order for the sale of at least a portion of Kelley’s land.

                                        I. BACKGROUND

        [¶2] In June 2012, Cote filed a mechanic’s lien in the Kennebec County

Registry of Deeds against real property owned by Kelley. On August 9, Cote

brought a complaint to enforce the lien against defendants Kelley and RC & Sons

Paving, Inc. (RC), and party-in-interest Rent-It, Inc. Only Kelley is a party to this

appeal. 1    Kelley’s clerk/registered agent was served with the complaint on

August 30. The complaint alleged that Kelley leased land to RC, and that pursuant

to a contract with RC, and with Kelley’s consent, Cote constructed an asphalt plant

on Kelley’s land. It further alleged that Cote worked on the project through

April 2012 but was not paid in full.

        [¶3] Kelley did not respond to the complaint, and on November 9 the court

entered its default. In January 2013, Cote moved for summary judgment and

requested an order that Kelley’s property be sold to satisfy the lien. Kelley did not

respond to the motion, which the court granted on April 4. It entered judgment for

Cote in the amount of $29,990, plus interest and attorney fees, and ordered that the

    1
    RC defaulted and the court entered judgment against it. It has not appealed. Rent-It, Inc., filed a
mechanic’s lien against Kelley but failed to perfect it; the court found its lien to be “void and invalid.”
                                                                                    3

property be sold to satisfy the judgment if it was not redeemed by Kelley within

ninety days.

      [¶4] On April 19, ten days after the judgment was entered on the docket,

Kelley appeared for the first time and filed motions to set aside its default pursuant

to M.R. Civ. P. 55(c) and for relief from the judgment pursuant to M.R.

Civ. P. 60(b). Following a hearing, the court declined to set aside the default. It

did, however, grant Kelley relief by treating its Rule 60(b) motion as a motion to

alter or amend the judgment pursuant to M.R. Civ. P. 59(e), and striking its order

to sell what Kelley represented was a property worth more than $1 million and

awarding Cote a money judgment in its place.

      [¶5] Kelley’s appeal and Cote’s cross-appeal followed.

                                 II. DISCUSSION

A.    The Summary Judgment Granted to Cote

      [¶6] The statute governing the creation of a mechanic’s lien provides, in

the part relevant here, that

      [w]hoever performs labor or furnishes labor or materials . . . used in
      erecting, altering, moving or repairing a . . . building or appurtenances
      . . . by consent of the owner, has a lien thereon and on the land on
      which it stands and on any interest such owner has in the same, to
      secure payment thereof, with costs. If the owner of the building has
      no legal interest in the land on which the building is erected . . . the
      lien attaches to the building, and . . . may be enforced as provided.

10 M.R.S. § 3251 (2013).
4

      [¶7] Kelley contends that the court erred in finding that on the summary

judgment record there was no genuine issue of fact concerning three of

section 3251’s requirements, namely that (1) Cote built the asphalt plant with

Kelley’s consent; (2) RC, the owner of the plant, had a legal interest in the Kelley

land on which it was constructed; and (3) concerning the measure of damages, that

Kelley’s property was improved by Cote’s work.

      [¶8] We will

      review the grant of a summary judgment de novo, viewing the
      summary judgment record in the light most favorable to the
      nonprevailing party to determine whether it demonstrates that there is
      no genuine issue of material fact and the moving party is entitled to
      judgment as a matter of law. When, as here, the plaintiff has moved
      for summary judgment, the plaintiff has the burden to demonstrate
      that each element of its claim is established without dispute as to
      material fact within the summary judgment record.

Cach, LLC v. Kulas, 2011 ME 70 ¶ 8, 21 A.3d 1015 (quotation marks omitted).

Even when the nonmoving party’s response is inadequate, or, as here, nonexistent,

the moving party has the burden to show why summary judgment is appropriate:

      A moving party’s factual assertions may not be deemed admitted
      because of an improper response unless those factual assertions are
      properly supported. As we have explained, a party who moves for a
      summary judgment must properly put the motion and, most
      importantly, the material facts before the court, or the motion will not
      be granted, regardless of the adequacy, or inadequacy, of the
      nonmoving party’s response.

Id. ¶ 9 (alteration, citation, and quotation marks omitted).
                                                                                     5

       1.        Consent

       [¶9] Cote’s mechanic’s lien stated that the work it performed was done with

Kelley’s knowledge and consent. Cote made the same assertion in its statement of

material facts, and supported that statement with the affidavit of its controller,

Daniel Gagne. The affidavit was not challenged, and the statement of material

facts was uncontroverted and is thus deemed admitted. M.R. Civ. P. 56(h)(4).

Accordingly, in entering a summary judgment for Cote, the court had a sufficient

basis to find that Kelley consented and therefore “Cote is entitled to Judgment . . .

and is entitled to enforce its lien.” See Platz Assocs. v. Finley, 2009 ME 55, ¶ 24,

973 A.2d 743 (“[Defendant’s] failure to respond to [plaintiff’s] request for

admission establishes as fact that [defendant] knew about and consented to the

work. . . .”).

       2.        RC’s Legal Interest in Kelley’s Land

       [¶10]       Kelley argues that the summary judgment record contained

insufficient evidence to establish that RC had a “legal interest in the land on which

the building is erected,” 10 M.R.S. § 3251, a showing necessary to allow Cote’s

mechanic’s lien to attach to the land and not just the asphalt plant itself. Kelley did

not raise that argument in its Rule 60(b) motion in the trial court. Accordingly, it

has waived the issue on appeal. See Thayer Corp. v. Me. Sch. Admin. Dist. 61,

2012 ME 37, ¶ 4 n.4, 38 A.3d 1263.
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      [¶11]    Even if it were not waived, the argument fails because Cote’s

uncontroverted statement of material facts, supported by the unchallenged Gagne

affidavit, states that the site of the plant was “owned by Defendant Kelley . . . and

leased by RC.” Beyond the four corners of the summary judgment record, an

affidavit executed by Peter Kelley, an officer of Kelley Earthworks, Inc., filed in

support of Kelley’s Rule 60(b) motion, states that “Kelley, Inc. entered into a lease

with RC” and “[t]he lessee was to pay to Kelley Inc. rent of at least $80,000 per

year.” Furthermore, the Rule 60(b) motion itself refers to “claimed acts of [Cote]

on behalf of Kelley’s lessee.” RC’s leasehold interest is a sufficient “legal interest

in the land” to support the court’s judgment. 10 M.R.S. § 3251; see Benham v.

Morton & Furbish Agency, 2007 ME 83, ¶ 17, 929 A.2d 471 (“It is clear that a

lease conveys a possessory interest in the land to another for a period of time.”

(quotation marks omitted)); Stewart v. Aldrich, 2002 ME 16, ¶ 14, 788 A.2d 603

(“A bedrock principle of our jurisprudence has been that a lease . . . is equivalent to

a conveyance for almost all purposes . . . .”); Fischbach & Moore, Inc. v. Presteel

Corp., 398 A.2d 397 (Me. 1979) (affirming a mechanic’s lien filed against a

building owner when the leaseholder arranged for work to be done with the

owner’s consent).
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         3.    Calculation of Damages

         [¶12] The uncontroverted statement of material facts states that Cote was

owed $29,990 plus interest, costs, and attorney fees. The Gagne affidavit reflects

that amount, and it includes as an exhibit copies of invoices from Cote to RC. The

court, without comment, awarded Cote the amount that it requested in its entry of

summary judgment and again in granting Kelley Rule 59(e) relief.2

         [¶13] A bill for the cost of improvements is evidence, albeit not dispositive

evidence, of enhanced value to the property owner. A.F.A.B., Inc. v. Town of Old

Orchard Beach, 657 A.2d 323, 325 (Me. 1995). Here, by failing to oppose Cote’s

motion for summary judgment, Kelley ensured that the invoices were the only

evidence of damages. “Although an award must be supported by some evidence of

the amount of loss, damages need not be proved to a mathematical certainty.”

Graham v. Brown, 2011 ME 93, ¶ 12, 26 A.3d 823 (quotation marks omitted). The

court did not err in relying on the only competent evidence of Cote’s damages that

was before it.

B.       Denial of Rule 60(b) Relief

         [¶14] Kelley contends that the court erred in denying it relief from summary

judgment pursuant to Rule 60(b)3 because Cote committed a fraud against the court

     2
      We have considered Kelley’s argument that the court erred in awarding Cote interest and attorney
fees as part of its judgment, find it to be unpersuasive, and do not discuss it further.
8

in several representations it made in its statement of material facts and in

supporting documents. We review the denial of Rule 60(b) relief for an abuse of

discretion that “works a plain and unmistakable injustice against the defendant.”

In re David H., 2009 ME 131, ¶ 41, 985 A.2d 490 (quotation marks omitted).

          [¶15] As an initial matter, the trial court did not find sufficient proof to

conclude that Cote had worked a fraud against it, nor do we. In all of Kelley’s

pleadings, it does not dispute that Cote built an asphalt plant on land owned by

Kelley.        Furthermore, Kelley cannot meet its burden on this issue because

“Rule 60(b) presupposes that a party has performed [its] duty to take legal steps to

protect [its] own interests in the original litigation.” Id. (quotation marks omitted);

see also McKeen & Assocs. v. Dep’t of Transp., 1997 ME 73, ¶ 4, 692 A.2d 924

(same). By defaulting on Cote’s complaint and then taking no steps to oppose

summary judgment until ten days after a final judgment was entered, Kelley failed

to protect its own interests. It was not a “plain and unmistakable injustice” for the

    3
        Maine Rule of Civil Procedure 60(b) provides, in part:

          On motion and upon such terms as are just, the court may relieve a party or the party’s
          legal representative from a final judgment, order, or proceeding for the following reasons:
          (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence
          which by due diligence could not have been discovered in time to move for a new trial
          under Rule 59(b); (3) fraud (whether heretofore denominated intrinsic or extrinsic),
          misrepresentation, or other misconduct of an adverse party; (4) the judgment is void;
          (5) the judgment has been satisfied, released, or discharged, or a prior judgment upon
          which it is based has been reversed or otherwise vacated, or it is no longer equitable that
          the judgment should have prospective application; or (6) any other reason justifying relief
          from the operation of the judgment.
                                                                                                     9

trial court to hold Kelley to the consequences of that failure. In re David H.,

2009 ME 131, ¶ 41, 985 A.2d 490 (quotation marks omitted).

C.         Cote’s Cross-Appeal

           [¶16]     In its cross-appeal, Cote contends that the court was statutorily

required to order a sale of Kelley’s real property upon finding that Cote was

entitled to enforce its mechanic’s lien, and that it did not have the authority to

amend the remedy to a money judgment. In striking its original order that the

property be sold, the court found that (1) Kelley’s equity argument, namely that its

real property was worth more than $1 million, was insufficient to warrant setting

aside Cote’s lien altogether pursuant to Rule 60(b); but (2) that information did,

pursuant to Rule 59(e),4 warrant relief from a forced sale of the property. We

review the amended judgment for “a clear and manifest abuse of discretion.”

Ringuette v. Ringuette, 594 A.2d 1076, 1078 (Me. 1991) (quotation marks

omitted).5 A court abuses its discretion if it enters a judgment contrary to a

controlling statute. See Scott v. St. Pierre, 137 Me. 331, 331, 16 A.2d 473 (1940)

     4
         Maine Rule of Civil Procedure 59(e) concerns motions to alter or amend a judgment.
     5
      Ringuette v. Ringuette, 594 A.2d 1076 (Me. 1991), cited by the trial court as authority for its
amended judgment, is distinguishable from facts presented here. In Ringuette, a divorce case, the court
reopened the evidence and subsequently amended its divorce judgment. 594 A.2d at 1076-77. We
affirmed, recognizing the divorce court’s “wide discretion in determining a just division of marital
property.” Id. at 1078. Here, the issue is the remedy required by the mechanic’s lien statutes, not the
broad discretion of a divorce court.
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(“When . . . the case is barren of proof of the statutory requirements . . . the ruling

below is one contrary to law and is an abuse of discretion.”).

      [¶17]   We conclude that the mechanic’s lien statutes require a sale of

Kelley’s property in order to satisfy Cote’s lien, but they do not necessarily require

a sale of the entire parcel. In its original judgment, the court ordered a sale

pursuant to 10 M.R.S. § 3259 (2013). That section provides, in part:

      If it is determined that the parties or any of them . . . have a lien upon
      said building and land . . . the court may decree that said property . . .
      shall be sold, and shall prescribe the place, time, terms, manner and
      conditions of such sale. . . . If justice requires, the court may provide
      in the order of sale that the owner shall have a right to redeem the
      property from such sale within a time fixed in the order of sale. If the
      court shall determine that the whole of the land on which the lien
      exists is not necessary therefor, it shall describe in the order of sale a
      suitable lot therefor; and only so much shall be sold.

10 M.R.S. § 3259. After the sale of the entire property or “a suitable lot,” id., the

statutory scheme then allows a money judgment to satisfy any remaining

deficiency:

      If the proceeds of the sale after payment of costs and expenses of sale
      are insufficient to pay the lien claims and costs in full, the court may
      render judgment against the debtor in favor of each individual lienor
      for the balance of his claim and costs remaining unpaid, and may
      issue executions therefor.

10 M.R.S. § 3260 (2013).

      [¶18] The plain language of the statutory scheme formed by sections 3259

and 3260 does not contemplate a money judgment as an alternative to the sale of
                                                                                 11

property subject to a lien; rather, a money judgment is authorized only when

proceeds of the sale are insufficient to satisfy the lien. See Hickson v. Vescom

Corp., 2014 ME 27, ¶ 15, 87 A.3d 704 (stating that the Law Court “examine[s] the

plain meaning of the statutory language seeking to give effect to the legislative

intent” (quotation marks omitted)). This construction is supported by 10 M.R.S.

§ 3265, which is the statutory provision cited by Cote on its cross-appeal. That

section provides that

        [w]hen a judgment is rendered in any action authorized by chapters
        601 to 6316 against any . . . building or appurtenances, . . . and the
        land on which it stands . . . said property shall be taken and sold on
        execution in the same manner that rights of redeeming mortgaged real
        estate may be taken and sold.

10 M.R.S. § 3265 (2013).

        [¶19] Sections 3259 and 3265 both require a sale of property that is subject

to a lien. See Hickson, 2014 ME 27, ¶ 15, 87 A.3d 704 (stating that the Law Court

“construe[s] the whole statutory scheme of which the section at issue forms a part

so that a harmonious result, presumably the intent of the Legislature, may be

achieved” (quotation marks omitted)).      Accordingly, the trial court abused its

discretion in setting aside the remedy of a sale altogether and substituting a money

judgment.

  6
      10 M.R.S. §§ 3201-4012 (2013).
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        [¶20] The court was, however, authorized to include in its judgment a right

of redemption, as it did. Furthermore, going forward, it is authorized to partition

off a “suitable lot” in lieu of ordering a sale of the entire property if it deems that

course of action to be appropriate. In Twin Island Dev. Corp. v. Ross, we modified

and then affirmed a judgment entered by the Superior Court finding that a

mechanic’s lien existed and ordering the debtor to segregate and sell a fifty-acre

parcel of the property subject to the lien. 522 A.2d 901, 901-03 (Me. 1987). At

the Superior Court’s discretion, a similar remedy could be employed in this case to

balance the requirements of the mechanic’s lien statutes with the equities that the

court found to exist.

        The entry is:

                           Judgment vacated. Remanded for entry of a
                           judgment in favor of The Cote Corporation
                           consistent with this opinion.

On the briefs and at oral argument:

       C.H. Spurling, Esq., Gardiner, for appellant Kelley Earthworks,
       Inc.

       Theodore Small, Esq., Isaacson & Raymond, P.A., Lewiston, for
       appellee The Cote Corporation

Kennebec County Superior Court docket number RE-2012-66
FOR CLERK REFERENCE ONLY