Court Opinion

ID: 3146834
Source: CourtListenerOpinion
Date Created: 2015-10-22 18:22:34.823808+00
Date Added: 2024-06-11T15:08:39.905683
License: Public Domain

FIRST DIVISION
                                   Date Filed: December 22, 2008

No. 1-07-2369

INTER-RAIL SYSTEMS, INC.,          )   Appeal from the
a Missouri Corporation,            )   Circuit Court of
                                   )   Cook County.
     Plaintiff and Counter-        )
     defendant-Appellant,          )
                                   )
         v.                        )
                                   )
RAVI CORPORATION, VISHNU GOR,      )   No. O6 CH 08600
L.C. MERTZ, NATIONAL WASTE         )
SERVICES, INC., CAPITAL            )
ACQUISITIONS AND DEVELOPMENT,      )
INC., MARQUETTE NATIONAL BANK,     )   Honorable
RPM RECYCLING, UNKNOWN OWNERS      )   Clifford L. Meacham and
and NONRECORD CLAIMANTS,           )   Robert J. Quinn,
                                   )   Judges Presiding.
     Defendants and Counter-       )
     plaintiffs-Appellees.         )

     JUSTICE HALL delivered the opinion of the court:

     The plaintiff, Inter-Rail Systems, Inc., filed a multicount

complaint against the defendants, Ravi Corporation, Vishnu Gor,

L.C. Mertz, National Waste Services, Inc., Capital Acquisitions

and Development, Inc., Marquette National Bank, RPM Recycling,

unknown owners and nonrecord claimants (collectively the

defendants).    Counts I and IV sought foreclosure of mechanic's

liens filed against two properties owned by the defendants.      The

remaining counts alleged causes of action for breach of contract

and quantum meruit.    The circuit court granted the defendants'

motion for partial summary judgment as to counts I and IV of the

complaint and found that there was no just reason to delay
No. 1-07-2369

enforcement or appeal of its order.

     The plaintiff appeals.   The sole issue on appeal is whether

the defendants were entitled to partial summary judgment because

the removal and disposal of waste pursuant to a United States

Environmental Agency order is not a lienable activity under the

Mechanics Lien Act (770 ILCS 60/1 et seq. (West 2004)) (the Act).

The pertinent facts are taken from the pleadings, exhibits,

depositions and affidavits contained in the record on appeal.

     In July 2005, responding to a request from the City of

Chicago department of the environment, the United States

Environmental Emergency Response Branch (the EPA) inspected a

parking lot located at 6147 West 65th Street in Bedford Park,

Illinois.    In the parking lot were 14 semi-trailers filled with

drums and totes containing unknown chemicals; some of the

containers were leaking.   The substances appeared to be perfume

agents used in the manufacture of industrial cleaners.

     The EPA also inspected a warehouse at 6158 West 65th Street,

across the street from the parking lot.   The inspection of the

warehouse revealed over 500 55-gallon drums and a number of totes

throughout the building.   Many of the drums were in poor

condition.   There was material present on the outside of the

drums; some were leaking their contents onto the floor.     Many of

the drums had labels indicating they contained acids, caustics

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No. 1-07-2369

and oxidizers.   There were numerous pallets stacked with bags of

raw materials, including sodium hydroxide; many of the bags were

ripped open, releasing their contents.    The totes reportedly

contained waste water from previous operations at the site.

     In August 2005, the EPA met with a representative of

defendant Ravi Corporation at the warehouse.    There was a slight

haze in the warehouse most likely due to fumes from the acid

reacting with rain water.    The acid was leaking from a nitric

acid tank; a strong acid odor was noted in the vicinity of the

tank.

     According to the complaint, in August 2005, the defendants

contracted with the plaintiff for the removal and disposal of the

drums from both the parking lot and the warehouse (hereinafter

referred to collectively as "the site").    In the meantime, the

defendants and the EPA entered into a consent decree requiring

the defendants to clean up the site by testing and removing the

trailers, drums and totes.    The cleanup also required scraping,

sweeping, decontaminating or removing any areas of the trailers

or on the site where spills occurred in order to remove the

contamination.   The plaintiff's work was completed on December 1,

2005.   When the defendants failed to pay the balance due on the

contract, the plaintiff recorded mechanic's liens against the

site and filed the instant complaint.

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No. 1-07-2369

     In their motion for partial summary judgment, the defendants

maintained that, contrary to the plaintiff's claim that it

performed cleanup, removal and transport of hazardous waste from

the site, the plaintiff was contracted only to remove certain

drums containing various substances.    The defendants further

maintained that the plaintiff did not perform any work which

resulted in any improvements to the site.    Therefore, the

plaintiff did not meet the requirements for a lien claim under

the Act.   In support of their motion, the defendants relied on

the affidavits of defendant Vishu Gor, president of defendant

Ravi Corp., and Thomas Powell, a former employee of the

plaintiff.

     Mr. Gor averred that the plaintiff was hired to remove

certain drums containing various materials from the sites.     The

materials were all contained in drums prior to the arrival of the

plaintiff on the site.    Neither the plaintiff nor its personnel

was engaged to perform any cleaning or decontamination services

on the site.    In his affidavit, Mr. Powell averred that he was

the plaintiff's primary on-site employee for the project with the

defendants.    The plaintiff's work on the site consisted of

testing, removal and transport of drums containing various

materials.    At no time did the plaintiff perform or provide any

cleanup or decontamination of any spills, leaks or other

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No. 1-07-2369

contamination on the site.

     The defendants' motion was also supported by an April 16,

2006, EPA pollution report that described the plaintiff's

activities on the site as follows:

          "Beginning in September 2005, the LC Mertz/Gor Drum

     contractor began staging and inventorying drums and

     containers located in both the warehouse and in trailers in

     the parking area.   Trailers in the parking area were moved

     to the warehouse loading dock and the contents of the

     trailers were off loaded and staged in the warehouse."

After describing the number of containers found in the warehouse

and the number moved from the trailers to the warehouse, the

report continued as follows:

          "All drums, containers, and tanks were given an

     identification number, sampled and hazard characterized

     (haz-cat). *** Representative samples of the identified

     waste streams were sent to a laboratory for analysis.

     Materials were grouped into their respective waste streams

     for disposal.

           All other RCRA empty drums, totes and jugs were

     cut/crushed.

           In addition, the floor drainage pit was pumped and

     rinsed, several tanks on-site were emptied and rinsed.

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No. 1-07-2369

     Contents of the floor pit and tanks were characterized and

     appropriately disposed of offsite.   The floor and machinery

     were cleaned.   The contractor demobed from the site on

     December 15, 2005."

     In its response to the motion for partial summary judgment,

the plaintiff maintained that the removal of the hazardous and

toxic waste from the site constituted an improvement to the

property under the Act.    The plaintiff cited the findings of the

EPA that conditions on the site posed a threat to public health

and welfare and that the removal order was necessary to protect

the public.   The plaintiff maintained that the defendants

admitted that cleanup of toxic and hazardous waste was lienable

under the Act, and therefore, their motion for partial summary

judgment should be denied.

     In support of its response, the plaintiff relied on Mr.

Gor's deposition testimony in which he acknowledged the hazard

the drums posed to the environment.   The plaintiff also cited Mr.

Powell's deposition testimony in which he described the

protective clothing he wore while moving the drums in order to

avoid coming into contact with or breathing in any of the

substances.

     As to the work performed, the plaintiff relied on Mr.

Powell's description of the activities undertaken by the

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No. 1-07-2369

plaintiff's personnel at the site.   The plaintiff's personnel had

to break through a floor to access some of the drums.   They

drained tanks and the pipes along the walls.   They did not wash

the tanks but did wipe down the equipment and the tanks

afterwards.   They tested the floor pits and then drained them.

The drums that were leaking in the trailers were scraped and

burned out.   For the substances that leaked from the drums in the

warehouse, dry oil was put around the drum and then disposed of

in another drum.

     Finally, the plaintiff relied on the deposition testimony of

Robert Janota, the plaintiff's president.   According to Mr.

Janota, in addition to the removal, transport and disposal of the

waste-containing drums, the plaintiff's personnel placed the

leaking drums in "'overpacked" drums, pumped out the floor pits

and disposed of their unidentified contents, repackaged smaller

containers, and removed some of the piping when the pipes were

emptied.

     In its reply to the plaintiff's response, the defendants

maintained that deposition testimony of Mr. Janota and Mr. Powell

confirmed that no lienable decontamination service was provided

by the plaintiff.   In addition, the defendants contended that the

plaintiff was unable to delineate between any potentially

lienable work and the nonlienable work.   Finally, the defendants

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No. 1-07-2369

pointed to the plaintiff's acknowledgment that the cleanup,

consisting of the sweeping and rinsing of the floors, took place

at only one part of the site.

     At the hearing on the motion for partial summary judgment,

the parties agreed that a significant amount of the materials

removed from the site was hazardous.   The circuit court then

stated as follows:

          "Your real problem here, from my perspective, is

     apportionment. ***   There's not, in my judgment, there is no

     real significant possibility of your being able to apportion

     that which is lienable from that which is nonlienable, and I

     concede that for the purposes of this argument that some of

     the efforts your client took are lienable.   *** [b]ut at the

     same time, there's no question that a lot of it is

     nonlienable, unless you can apportion the whole lien is

     going to fail.   So I am going to grant the motion with

     respect to those two counts.

           If you can come in here within 30 days and establish

     some basis to apportion, feel free to do that."

The circuit court confirmed that it did not believe that the

disposal of sealed drums constituted lienable work.

     The plaintiff chose not to replead counts I and IV.    On

August 22, 2007, the court dismissed counts I and IV with

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No. 1-07-2369

prejudice and found no just reason to delay enforcement or appeal

of its order.   This appeal followed.

                              ANALYSIS

     The plaintiff contends that the circuit court's grant of

partial summary judgment to the defendants was erroneous because

the removal and disposal of hazardous and toxic waste from the

site constituted an improvement to the property under the Act,

and therefore, such work was lienable.   The defendants respond

that the plaintiff's removal of sealed drums, many of which

contained no hazardous substances, and the incidental sweeping

and rinsing were not lienable.   The defendants further maintain

that, even if some of the plaintiff's work was lienable, the

plaintiff's failure to delineate between the lienable work and

the nonlienable work defeated the entire lien.

                      I.   Standard of Review

     We review an order granting a motion for summary judgment

under the de novo standard of review.    Luise, Inc. v. Village of

Skokie, 335 Ill. App. 3d 672, 678, 781 N.E.2d 353 (2002).

"Summary judgment is proper if, and only if, the pleadings,

depositions, admissions, affidavits and other relevant matters on

file show that there is no genuine issue of material fact and

that the movant is entitled to judgment as a matter of law."

Prowell v. Loretto Hospital, 339 Ill. App. 3d 817, 822, 791

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No. 1-07-2369

N.E.2d 1261 (2003).    In determining whether a genuine issue of

material fact exists, the pleadings, admissions and affidavits

are construed strictly against the movant and liberally in favor

of the nonmovant.     Prowell, 339 Ill. App. 3d at 822.    "A triable

issue precluding summary judgment exists where the material facts

are disputed or reasonable persons might draw different

conclusions from undisputed facts."       Prowell, 339 Ill. App. 3d at

822.

                            II.    Discussion

       "The purpose of the Mechanics Lien Act [citation] is 'to

require a person with an interest in real property to pay for

improvements or benefits which have been induced or encouraged by

his or her own conduct.'"     Stafford-Smith, Inc. v.

Intercontinental River East, LLC, 378 Ill. App. 3d 236, 240, 881
N.E.2d 534 (2007), quoting Leveyfilm, Inc. v. Cosmopolitan Bank &

Trust, 274 Ill. App. 3d 348, 352, 653 N.E.2d 875 (1995).

Mechanic's liens were not recognized at common law or in equity

but were created by statute.       Tefco Construction Co., Inc. v.

Continental Community Bank & Trust Co., 357 Ill. App. 3d 714,

718, 829 N.E.2d 860 (2005).       "While the Act should be construed

liberally as a remedial one, being in derogation of the common

law, it is strictly construed with reference to the requirements

upon which the right to a lien depends."        Tefco Construction Co.,

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No. 1-07-2369

Inc., 357 Ill. App. 3d at 719.    Mechanic's liens "should not be

extended to cases not provided for by the language of the [A]ct

even though they may fall within its reason."    Robinette v.

Servite Fathers, 49 Ill. App. 3d 585, 587, 364 N.E.2d 679 (1977).

     In order to assert a lien under the Act, a party must meet

the statutory definition of the term "contractor."    Section 1 of

the Act defines a "contractor" as:

            "[a]ny person who shall by any contract or contracts,

     express or implied, or partly expressed or implied, with the

     owner of a lot or tract of land, or with one whom the owner

     has authorized or knowingly permitted to contract, to

     improve the lot or tract of land or for the purpose of

     improving the tract of land."    770 ILCS 60/1(a) (West 2006).

     There is no dispute that the parties entered into a

contract.    The question is whether the contract was for the

improvement of the site.    Section 1(b) provides in pertinent part

as follows:

            "As used in subsection (a) of this Section, 'improve'

     means to furnish labor, services, material, fixtures,

     apparatus or machinery, forms or form work in the process of

     construction where cement, concrete or like material is used

     for the purpose of or in the building, altering, repairing

     or ornamenting any house or other building, walk or

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No. 1-07-2369

     sidewalk, *** or fill, sod or excavate such lot or tract of

     land, or do landscape work thereon or therefor; or raise or

     lower any house thereon or remove any house thereto, or

     remove any house or other structure therefrom, or perform

     any services or incur any expense as an architect,

     structural engineer, professional engineer, land surveyor or

     property manager in, for or on a lot or tract of land for

     any such purpose; or drill any water well thereon; or

     furnish or perform labor or services as superintendent, time

     keeper, mechanic, laborer or otherwise, in the building,

     altering, repairing or ornamenting of the same ***."     770

     ILCS 60/1(b) (West 2006).

"The focus of the inquiry to determine whether a mechanic's lien

should be granted is whether the work performed has enhanced the

value of the land to be charged with the lien."   Cleveland

Wrecking Co. v. Central National Bank, 216 Ill. App. 3d 279, 285,

576 N.E.2d 1055 (1991).

     Illinois courts have held that services that merely maintain

rather than improve property are nonlienable activities.      In

Watson v. Watson, 218 Ill App. 3d 397, 578 N.E.2d 275 (1991), the

court held that the payments and advancements for federal estate

tax installments, county real estate taxes and farm operating

loans did not enhance the value of the farmland but merely

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No. 1-07-2369

preserved its value.     Watson, 218 Ill. App. 3d at 400.   In Lyons

Savings v. Gash & Associates, 279 Ill. App. 3d 742, 665 N.E.2d
326 (1996), the court found that scrubbing and sealing of the

tile and the grout on walls and floors constituted nonlienable

maintenance, where there was no evidence that the work was

necessitated by other lien claimants.     Lyon Savings, 279 Ill.

App. 3d at 747-48.

     The plaintiff asserts that the removal of the drums

containing hazardous waste was not mere maintenance but enhanced

the value of the land.    In Cleveland Wrecking Co., the defendant

argued that the removal of debris from a demolition site was not

a lienable activity.   The appellate court disagreed.   The court

distinguished Robinette, inter alia, on the basis that the

plaintiff there merely removed debris from a building someone

else demolished.   In contrast, the plaintiff's work in Cleveland

Wrecking Co. included both the demolition and the removal of the

debris in order to make way for new construction and therefore

was an integral part of the overall plan to improve the property.

Cleveland Wrecking Co., 216 Ill. App. 3d at 287. In the instant

case, the plaintiff was only involved in the removal of debris,

already contained.

     Subsequently, in Midwest Environmental Consulting &

Remediation Services, Inc. v. Peoples Bank of Bloomington, 251

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No. 1-07-2369

Ill. App. 3d 256, 620 N.E.2d 469 (1993), the reviewing court

rejected the defendant's argument that the charges for disposing

of the contaminated soil at a landfill were separate from the

expenses incurred as a result of the removal of storage tanks and

contaminated soil and the hauling away of the contaminated soil

from the premises.   The issue was waived because it was never

raised in the trial court.   However, waiver aside and citing

Cleveland Wrecking Co., the reviewing court found as follows:

     "[T]he disposal of the removed contaminated soil is an

     integral part of the overall plan to improve the land and is

     lienable under the Act. [Citation.]    The activity of

     removing the soil is not separable from disposing of it.

     Once removed, it must be disposed of in some fashion.    If

     there is a cost which is incurred as a result, that cost is

     part of the removal of the soil."     Midwest Environmental

     Consulting & Remediation Services, Inc., 251 Ill. App. 3d at

     262.

     The plaintiff's reliance on Midwest Environmental Consulting

& Remediation Services, Inc. is misplaced.    In that case, there

was no dispute that the removal of the underground storage tanks

and the contaminated soil was done to improve the property.     The

removal of the storage tanks and excavation of the contaminated

soil necessitated the removal and disposal of the contaminated

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No. 1-07-2369

soil from the premises.   In the present case, the plaintiff did

not perform the work that resulted in the filling of the drums

with the hazardous waste. It made no changes to the structure of

the building or its land either by repair or demolition other

than to facilitate waste removal.      It merely removed and disposed

of the drums, already filled with the waste, and performed

incidental cleaning activities.    None of these activities were

shown to be part of an overall plan to improve rather than simply

maintain the property.

     We find the decision in TPST Soil Recyclers of Washington,

Inc. v. W.F. Anderson Construction, Inc., 91 Wash. App. 297, 957
P.2d 265 (1998), to be instructive.     In that case, the property

owners contracted with Anderson to remove and replace fuel

storage tanks on the property.    After discovering contaminated

soil, Anderson contracted with the plaintiff to haul away and

dispose of the contaminated soil.      The plaintiff removed the soil

and recorded a mechanic's lien against the property for the

unpaid contract.   The trial court granted summary judgment to the

defendant.   The plaintiff appealed.

     Relying in part on Cleveland Wrecking, the reviewing court

held that the plaintiff's role in merely removing the debris did

not involve it in the overall scheme to improve the property.

Therefore, the plaintiff's work did not entitle it to a

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No. 1-07-2369

mechanic's lien on the property.       TPST Soil Recyclers of

Washington, Inc., 91 Wash. App. at 301-02, 957 P.2d at 267.1

Likewise, in the present case, the plaintiff's activities were

limited to removing and disposing of the hazardous waste.

    The plaintiff relies on Midwest Asbestos Removal Service,

Inc. v. Crown Cork & Seal Co., No. 90 C 7010 (N.D. Ill. January

25, 1993).     In that case, the district court held that the

removal and hauling away of asbestos from a building fell within

the meaning of the Act.     According to the testimony at trial, the

plaintiff removed asbestos ceiling tiles and drain wrappings to

comply with OSHA2 and environmental laws.      There was expert

testimony that the value of the property was significantly less

with the asbestos tile and pipe wrapping present and that the

value of the building would improve with the removal of the

asbestos.     Describing the asbestos removal as both a repair and

an improvement, the court found that the removal improved the

premises, and therefore, the work performed was within the

meaning of the Act.     Midwest Asbestos Removal Service, Inc., slip

op. at ___.

     1
         While federal decisions and those of our sister states are

not binding on this court, we find them instructive in this case.
     2
         Occupational Safety and Health Act (29 U.S.C. §651 (____).
.

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No. 1-07-2369

     Midwest Asbestos Removal Service, Inc. is distinguishable.

The decision in that case was reached after a trial on the

merits, not at the summary judgment stage.    Moreover, in the

present case, the plaintiff failed to offer evidence that its

work improved the property, such as evidence of the value of the

site prior to and after the work it performed.

     We conclude that the activity of removing and disposing of

drums containing hazardous waste, in and of itself, does not

constitute an improvement to real property so as to be a lienable

activity under the Act.    As there was no evidence that the

plaintiff's work was part of an overall plan to improve the

property, its work was not a lienable activity under the Act.

     Finally, even if we were to determine that some of the

activities performed by the plaintiff were lienable, Illinois

case law supports the proposition that "where a lump sum contract

includes both lienable and nonlienable work, and such items

cannot be separated, the entire lien must fail."     Cleveland

Wrecking Co., 216 Ill. App. 3d at 287.     In the present case, the

circuit court granted the plaintiff the opportunity to file an

amended complaint apportioning the work.    However, the plaintiff

did not do so.   Now, on appeal, the plaintiff maintains that its

work can be apportioned.    By failing to amend its complaint in

the circuit court, the plaintiff has waived this argument.       See

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No. 1-07-2369

Purmal v. Robert N. Wadington & Associates, 354 Ill. App. 3d 715,

730, 820 N.E.2d 86 (2004) (the plaintiff waived right on appeal

to seek leave to amend her complaint where she chose to stand on

her complaint and did not seek leave to amend in the circuit

court).

     We conclude that the circuit court did not err in granting

summary judgment to the defendants on the mechanic's lien counts

of the complaint.   The circuit court's order granting partial

summary judgment to the defendants is affirmed.

     Affirmed.

     R.E. GORDON, P.J., and GARCIA, J., concur.

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No. 1-07-2369

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