Adair Mortg. Co. v. Allied Concrete Enterprises, Inc.

• Decision Date: 22 November 1977
• Docket Number: No. 54719,54719
• Citation: 241 S.E.2d 267,144 Ga.App. 354
• Parties: ADAIR MORTGAGE COMPANY v. ALLIED CONCRETE ENTERPRISES, INC.
• Court: Georgia Court of Appeals

Page 267

241 S.E.2d 267

144 Ga.App. 354

ADAIR MORTGAGE COMPANY v. ALLIED CONCRETE ENTERPRISES, INC.

No. 54719.

Court of Appeals of Georgia, Whole Court.

Nov. 22, 1977.

Rehearing Denied Dec. 14, 1977.

1. (a) The requirement of the first sentence of Code § 67-2002 as to the time within which an action may be commenced relates to the action against the contractor and not to the action against the owner of the real estate.

(b) The 1968 amendment to Code § 67-2002 (Ga.L.1968, p. 317) specifies circumstances under which an action to foreclose the materialman's lien in rem directly against the owner of real property improved, without first obtaining judgment against the contractor will lie and specifies that in such cases the action against the owner must be commenced within 12 months. The 12-month limitation in the 1968 amendment applies only to those cases wherein judgment need not be first obtained against the contractor. Language to the contrary in Whitley Const. Co. v. Carlyle etc., Ltd., 137 Ga.App. 113, 222 S.E.2d 895 and Assoc. Dist. v. De La Torre, 138 Ga.App. 71(2), 225 S.E.2d 462 is hereby disapproved and overruled.

2. Where, as here, the appellee materialman duly filed its claim of lien within 3 months of furnishing of supplies to a subcontractor, brought an action against the latter within twelve months, and obtained judgment thereon, but was not reimbursed, the foreclosure of lien against the owner and the property improved, commenced within six months thereafter was timely.

The appellee materialman sued the subcontractor to whom supplies had been furnished within 12 months of their due date, and obtained an in personam judgment. Within six months thereafter, the judgment not having been collected, he filed this in rem action against the property owner. The trial judge granted the plaintiff's motion for summary judgment and defendant appeals.

King & Spalding, A. Felton Jenkins, Jr., G. Lemuel Hewes, H. Lamar Mixson, Atlanta, for appellant.

Zachary & Segraves, Wayne F. Carmichael, Decatur, for appellee.

DEEN, Presiding Judge.

We are again cast into the thicket caused by Code § 67-2002(3) and its various amendments. The first clause of this subsection dealing with actions on materialmen's liens comes from § 1975 of the original Code of 1863. The section in its entirety reads as follows: "The following provisions must be complied with to make good the mechanic's lien, and on failure of either, the lien shall cease, viz: 1. A substantial compliance by the mechanic with his contract for building or repairing or materials furnished. 2. The recording of his claim of lien in the clerk's office of the county where the land lies in substance as follows: 'A. B., a mechanic, claims a lien on the house, and premises on which it is erected, of C. D. (describing the premises) (for building, repairing, or whatever the claim may be)' within three months from the time same is completed. 3. The commencement of an action for the recovery of the amount of his claim within twelve months from the time the same shall become due.''

All of the language of the original Code § 1975 has been retained in our present Code § 67-2002. The remaining language of the latter section is no more than an effort to clarify the types of situations to which this original action is applicable. The section was early amended to specify that the claim of lien be filed within three months. By 1884 the Supreme Court had written in Lombard v. The Trustees of the Young Men's Library Assn. Fund, 73 Ga. 322, 324, that under Code § 1990 (Code of 1882) "the suit to recover the claim must be commenced within twelve months from the time the claim became due; but no time is mentioned within which the lien must be foreclosed. There is great confusion on this subject in the statute, and the same calls for legislative interference, either to repeal the lien laws altogether or pass such enactments as will make the same clear and explicit." Although the section was amended on various occasions, this facet of the law was not clarified. In 1934 the Supreme Court, in Sou. Ry. Co. v. Crawford & Slaten Co., 178 Ga. 450, 173 S.E. 91, affirming a decision of this court on certiorari, held: "The Court of Appeals, in the decision under review, properly held, that, as applied to the facts of this case, the requirement of the statute as to the time within which the 'action' shall be commenced relates to the action in personam against the contractor, and not to the action against the owner of the real estate. Southern Ry. Co. v. Crawford & Slaten Co., 46 Ga.App. 424, 167 S.E. 756." ¹ The Supreme Court case has not been modified and continues to be cited on this point. In Chandler v. Pennington, 89 Ga.App. 676(2), 80 S.E.2d 843 the express ruling was that "it has long been established" that the 12-month period allowed for filing which is a condition precedent to the obtaining of the lien refers to "an action against the contractor and has no reference to the time within which the lien must be enforced."

Again, in Logan Paving Co. v. Liles Constr. Co., 141 Ga.App. 81, 83, 232 S.E.2d 575, this court has, as its last expression of opinion on the subject, again cited Sou. Ry. Co. v. Crawford & Co., 178 Ga. 450, 173 S.E. 91, supra, and stated, after quoting Code § 67-2002(3): "This language relates to an action against the person creating the debt and not to a subsequent suit to foreclose the lien against the property improved."

To the contrary, however, we have two intermediate suits, Whitley Constr. Co. v. Carlyle & Ltd., 137 Ga.App. 113, 222 S.E.2d 895, and Assoc. Dist. v. De La Torre, 138 Ga.App. 71, 225 S.E.2d 462. Both appear to be at odds with the Supreme Court and subsequent Court of Appeals cases in that they hold that a materialman's lien may be enforced directly against the property owner "only if filed directly against the owner within 12 months from the time the lien shall become due." Assoc. Dist. v. De La Torre, 138 Ga.App. 71(2), 225 S.E.2d 464, supra. The reason for the ruling is given in the Whitley case, where the 1968 amendment (Ga.L.1968, pp. 317, 318) to Code Ann. § 67-2002(3) is construed and the conclusion reached that "the General Assembly intended to impose the 12-month time limit upon actions against the landowner. This conclusion is reinforced by the retention in the statute of the specific reference to the 12-month time limit in bringing suit against the contractor except in the specified excusals."

This language referred to is that part of the 1968 amendment which provides, in substance, that the materialman is relieved from filing suit or obtaining judgment against the contractor as a prerequisite to enforcing a lien against the owner's property, but may in certain circumstances enforce his lien directly against the property without first obtaining a judgment against the contractor, if the lien foreclosure is "filed within 12 months from the time the same shall become due, with the judgment rendered in any such proceeding to be limited to a judgment in rem against the property improved and to impose no personal liability upon the owner of said property." The circumstances under which the original suit against the contractor may be bypassed all relate to loss of personal jurisdiction, as where the contractor absconds, dies, removes from the state, or is adjudicated a bankrupt. In such cases the materialman need not either file suit or obtain judgment against the contractor before proceeding against the owner, but if he follows this route, then the in rem foreclosure proceeding is substituted for the in personam action against the contractor, and the same time limit applies. Under this construction, the words of the 1968 amendment above quoted ("if filed within 12 months from the time the same shall become due") simply allow the plaintiff materialman an equal amount of time to commence his in rem proceeding against the property improved as he would have had to file suit against the contractor if he had been compelled to file such suit in the first instance.

Any other construction of the 12-month clause in the 1968 amendment would cause great enforcement difficulty. As noted by George Pindar, "Real Property," Mercer L.Rev., Vol. 28, p. 221: "As amended the act (Ga.L.1968, p. 317) is said (in the Whitley and De La Torre cases) to impose a one-year limit on the filing of a suit against an owner even though judgment must first be obtained against the contractor. The ruling may well place a lien-claimant in an almost impossible predicament. If the contractor resides in one county and the landowner in another, lien-claimant cannot...