Crane Co. v. Fine, 37748

• Citation: 221 So.2d 145
• Decision Date: 02 April 1969
• Docket Number: No. 37748,37748
• Parties: CRANE CO., an Illinois corporation, Petitioner, v. Martin FINE, J. I. Kislak and R. W. Johnson, d/b/a Parks Towers Associates, Ltd., Arkin Building Corp., a Florida corporation, the First National Bank of Miami, a banking corporation, and the Travelers Indemnity Company, a Connecticut corporation, Respondents.
• Court: United States State Supreme Court of Florida

Page 145

221 So.2d 145

CRANE CO., an Illinois corporation, Petitioner, v. Martin FINE, J. I. Kislak and R. W. Johnson, d/b/a Parks Towers Associates, Ltd., Arkin Building Corp., a Florida corporation, the First National Bank of Miami, a banking corporation, and the Travelers Indemnity Company, a Connecticut corporation, Respondents.

No. 37748.

Supreme Court of Florida.

April 2, 1969.

Karl V. Hart, of Shutts & Bowen, Miami, for petitioner.

Gerald M. Higier, of Meyer, Weiss, Rose & Arkin, Miami Beach, for respondents.

Eugene C. Heiman, of Heiman & Crary, Miami, as amicus curiae.

ROBERTS, Justice.

This cause is before the court on direct-conflict certiorari to review the decision of the District Court of Appeal, Third District, in Fine v. Crane Co., Fla.App.1968, 211 So.2d 219.

The facts of the case as summarized by the appellate court in its decision are substantially as follows: The petitioner, as plaintiff below, filed suit to foreclose a materialman's lien in the amount of some $4,400.00 on account of materials specially fabricated by it on the order of the plumbing subcontractor and incorporated in a building being constructed under a general contract between the defendant-owner of the land and the defendant-general contractor, as joint venturers. Thereafter, the plumbing subcontractor became insolvent and abandoned the plumbing job, which was then taken over and completed by the general contractor. At the time of the abondonment by the plumbing subcontractor, the general contractor was holding funds (some $15,000.00) due the plumbing subcontractor for labor and materials furnished to the job under the plumbing subcontract but not paid for by the general contractor under a percentage hold-back clause in the construction loan agreement. The plaintiff's notice of intention to claim a lien was not filed within 45 days of the date that it supplied the materials nor was its claim of lien filed within 90 days of that date. Its suit prayed for alternative relief in the form of an equitable lien, for recovery against the surety on the performance bond, and for a personal judgment against the defendant joint venturers. The trial court entered summary judgment for the plaintiff, and the appellate court reversed.

As the basis for its petition here, the petitioner contends that the appellate court's decision is in direct conflict with numerous decisions of this court respecting equitable liens and with the decision of the District Court of Appeal, Second District, in Tarlow v. Helmholtz, Fla.App.1967, 198 So.2d 109, respecting the time limit within which a notice of intention to claim a lien may be timely filed. Because of an apparent conflict with decisions concerning the right of the plaintiff to seek the remedy of an equitable lien, we issue the writ.

In disposing of the plaintiff's claim based on the remedy of an equitable lien, the appellate court adverted to the rule that equity will give relief to one who supplies materials that are incorporated in a building to the benefit of the owners and with their knowledge and consent, but concluded that

'This salutary principle has no application in the instant case, however. Plaintiff, who has failed by its own neglect to perfect its statutory rights, may nevertheless seek redress through other available legal remedies. The additional contingency that in such a situation the owner may be forced to pay twice for the same improvement forecloses the possibility that equity will aid the appellee here.' Fine v. Crane Co., supra, 211 So.2d at p. 221.

It is not clear whether the appellate court denied the plaintiff's prayer for an equitable lien on the ground that plaintiff had shown no special equities to support such a lien, or on the ground that plaintiff, having sought a lien under the Mechanics' Lien Law, was precluded from seeking also an equitable lien. In their brief filed here, the defendant-respondents argue both grounds in support of the appellate court's decision. Cited in support of the latter ground are the decisions of this court in Kimbrell v. Fink, Fla.1955, 78 So.2d 96, and Blanton v. Young, Fla.1955, 80 So.2d 351. Insofar as these decisions may be interpreted as holding that one who is within the purview of the Mechanics' Lien Law is limited to his statutory lien thereunder and is not entitled to seek an equitable lien, they are in direct conflict with Palmer v Edwards, Fla.1951, 51 So.2d 495; Green v. Putnam, Fla.1957, 93 So.2d 378; Tucker v. Prevatt Buildings, Inc., Fla.App.1st 1959, 116 So.2d 437, 438; and Dewing v. Davis, Fla.App.2d 1960, 117 So.2d 747. See also Wood v. Wilson, Fla.1955, 84 So.2d 32, in which we noted that in the Absence of special or peculiar equities a suit to enforce a materialman's or mechanic's lien must be brought within the statutory time limit, citing Kimbrell v. Fink, supra, 78 So.2d 96. To set this matter at rest, we re-affirm the rule stated in Green v. Putnam, supra, 93 So.2d 378, that

'* * * one who has performed services or furnished materials in the improvement of real property is not limited to proceeding under the mechanics' lien law, but may proceed to establish an equitable lien on the property in question.'

We have not overlooked the decision in Merritt v. Unkefer, Fla., Opinion on Rehearing Granted filed February 19, 1969, reversing Unkefer v. Merritt Fla.App.1968, 207 So.2d 726. In that case a majority of the court was of the opinion that the allegations of the complaint were insufficient to support an equitable lien. The facts of the case Sub judice, as recounted hereafter, are entirely different and, in our opinion, are ample to support the trial judge's conclusion that the plaintiff had a right to an equitable lien on the $15,000.00 'hold-back' fund.

Jurisdiction having attached because of the direct conflict noted above, we may consider the other questions here argued by the parties, namely, (1) whether the record showed special or peculiar equities in plaintiff's favor sufficient to support an equitable lien, as found by the trial judge; and (2) whether the appellate court erred in its interpretation of § 84.061(2)(a), Fla.Stat.1965 (§ 713.06(2)(a), Fla.Stat.1967, F.S.A.), respecting the time limit within which notice of furnishing materials or services must be given to the owner by a materialman or subcontractor not in privity with the owner as a pre-requisite to perfecting a statutory lien under the Mechanics' Lien Law. For the reasons stated hereafter, both questions must be answered in the affirmative.

The principles of law applicable to a determination of the equitable-lien question have been stated as follows: An equitable lien is simply a right of a special nature over a particular property that may arise from a written contract which shows an intention to charge the particular property with a debt or obligation, or it may be declared by a court of equity out of a general consideration of right and justice as applied to the relations of the parties and the circumstances of their dealings in the particular case. Jones v. Carpenter, 1925, 90 Fla. 407, 106 So. 127, 43 A.L.R. 1409. It is a remedial tool used by chancery to prevent inequity or unjust enrichment of one party as against another. Green v. Putnam, supra, 93 So.2d 378. It is particularly appropriate in a situation in which the primary debtor has become insolvent, see Jones v. Carpenter, supra, 106 So. 127; Palmer v. Edwards, supra, 51 So.2d 495; Tucker v. Prevatt Builders, Inc., supra, 116 So.2d 437, 438; or has parted with the Res that in right and justice should be held answerable for the claim made against it. See Dewing v. Davis, supra, 117 So.2d 747; Industrial Supply Corp. v. Lee, Fla.1950, 48 So.2d 285.

The 'particular property' in which the plaintiff had 'a right of a special nature,' according to the trial judge, was the $15,000.00 fund due and owing the plumbing subcontractor for work already performed at the time it abandoned the plumbing subcontract (in November of 1965). This fund was still in the hands of the general contractor at the time (in December of 1965) the plaintiff notified the owner and the general contractor that it had furnished materials to the job in September of 1965 under the plumbing subcontract. The notice was filed by plaintiff long before the completion of the construction and the time for filing the general contractor's final (and, in fact, only) affidavit as to unpaid lienors (in April of 1966); and many progress paymants were thereafter made by the owner to the contractor. The plumbing subcontractor with whom plaintiff was in privity was insolvent. There can be no doubt that plaintiff--as well as any other materialmen whose materials were incorporated in the improvement under the plumbing subcontract and who, like plaintiff, remained unpaid at the time the plumbing subcontractor abandoned the contract--had 'a right of a special nature' in the funds due and owing on account of materials supplied by them to the improvement. As between the owner and the contractor in their capacity as joint venturers, on the one hand, and the plaintiff on the other hand, the right and justice of the matter is plain. The former have no right, title or interest in the $15,000.00 fund except as security for the payment of the plumbing subcontractor's materialmen who, like plaintiff, remained unpaid at the time of its abandonment of the plumbing subcontract, or possibly as security for any damages sustained by reason of the breach of the plumbing subcontract. No contention is made that any other lienor furnishing labor or materials under the plumbing subcontract remains unpaid or claims any portion of the $15,000.00 hold-back fund--in fact, the plaintiff states that the contrary is true. Assuming arguendo that the owner-contractor joint venturers had the right to apply the $15,000.00 hold-back fund to any damages sustained by them by reason of the breach of the plumbing subcontract, there is nothing in the...