West Charleston Lofts I, LLC v. R&O Construction Co., 102110 FED9, 09-16313

Docket Nº:09-16313, 09-16887
Party Name:WEST CHARLESTON LOFTS I, LLC, et al., Plaintiffs - Third Party Defendants-Appellees, v. R&O CONSTRUCTION COMPANY, Defendant-Appellant, v. CHARLES G. HALL, et al., Third Party Defendants-Appellees.
Judge Panel:Before: BEEZER and GRABER, Circuit Judges, and CARNEY, District Judge.
Case Date:October 21, 2010
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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WEST CHARLESTON LOFTS I, LLC, et al., Plaintiffs - Third Party Defendants-Appellees,

v.

R&O CONSTRUCTION COMPANY, Defendant-Appellant,

v.

CHARLES G. HALL, et al., Third Party Defendants-Appellees.

Nos. 09-16313, 09-16887

United States Court of Appeals, Ninth Circuit

October 21, 2010

NOT FOR PUBLICATION

Argued and Submitted October 8, 2010 San Francisco, California

Appeal from the United States District Court for the District of Nevada Philip M. Pro, District Judge, Presiding, D.C. No. 2:09-CV-00392-PMP-LRL

Before: BEEZER and GRABER, Circuit Judges, and CARNEY, [**] District Judge.

MEMORANDUM [*]

Appellant R&O Construction Company ("R&O") appeals two orders by the district court. The first granted Plaintiff-Appellees West Charleston Lofts I, LLC and WCL Commercial, LLC's ("WCL") motion to expunge mechanics' liens filed by R&O. The second granted WCL's motion to dismiss R&O's third party complaint and counterclaims to foreclose on those mechanics' liens and obtain recovery for unjust enrichment. WCL hired R&O to build a 40-unit condominium project in Las Vegas, Nevada. The district court's orders were premised on its holding that R&O's mechanics' liens were premature and frivolous pursuant to Nevada Revised Statutes § 108.2275 because the final payment of $682, 595 remaining under the parties' contract was not payable until several major punch list items were completed or fixed. We review de novo the district court's construction of the relevant statutory provisions of Nevada law as well as its grant of WCL's motion to dismiss. Knievel v. ESPN, 393 F.3d 1068, 1072 (9th Cir. 2005). We reverse, reinstate R&O's liens, and remand for further proceedings.

The district court erred in concluding that R&O had no statutory right to the final payment and that the parties' contract was controlling on the issue. The Nevada Legislature enacted the Prompt Payment Act to protect contractors from the harm that they suffer when owners unfairly withhold payment, including final payment on projects that are substantially complete and available for use. Nevada Revised Statutes § 624.620(1)(b)(2), which is part of the Prompt Payment Act, specifically provides that "any money remaining unpaid . . . is payable to the prime contractor within 30 days after" the owner receives "[a] certificate of occupancy issued by the appropriate building inspector or other...

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