CMI Contracting, Inc. v. Little River Lodging, LLC

• Decision Date: 30 June 2004
• Docket Number: 2004-UP-421
• Parties: CMI Contracting, Inc., Respondent, v. Little River Lodging, LLC and Construction Design Associates, Inc., Defendants, of whom Little River Lodging, LLC, is, Appellant.
• Court: South Carolina Court of Appeals

CMI Contracting, Inc., Respondent, v. Little River Lodging, LLC and Construction Design Associates, Inc., Defendants, of whom Little River Lodging, LLC, is, Appellant.

No. 2004-UP-421

Court of Appeals of South Carolina

June 30, 2004

UNPUBLISHED OPINION

Submitted June 8, 2004

Appeal From Horry County J. Stanton Cross, Jr., Master-In-Equity

W. W DesChamps, Jr., of Myrtle Beach, for Appellant.

Reese R. Boyd III, of Myrtle Beach, for Respondent.

PER CURIAM

Little River Lodging, LLC, appeals the trial court's order granting judgment in favor of CMI Contracting, Inc., on a mechanic's lien in the amount of $73, 620.75. The order also awarded CMI $18, 055.95 in prejudgment interest and $8 533.70 in attorney's fees. As an alternative but superceded ground for recovery, the trial court found Little River liable to CMI for the amount of the alleged mechanic's lien on the basis of CMI's unjust enrichment claim. We affirm. ^[1]

FACTS

Little River is the owner of a parcel of real estate situated in Horry County, South Carolina upon which it sought to construct a commercial hotel development. Through its owner and operator, Bhupendra Patel, Little River contacted co-defendant Construction Design Associates, Inc. (CDA”), a general contractor, in February 2000 and asked CDA to begin working on the project. CDA and Little River understood the first phase of this project to include clearing the parcel and filling some wetlands on the property. Due to a longstanding professional relationship between CDA and Little River, CDA did not initially require a written agreement with Little River.

Subsequent to these discussions concerning the property, CDA entered a subcontract agreement with CMI for the clearing and wetland work to be performed on the property. The subcontract agreement included a cost estimate from CMI of approximately $118, 000. CMI began performing the agreed upon work in early March and completed the work on April 11, 2000. CDA and Patel visited the work site during the months CMI performed the work specified in the subcontract agreement.

Following the work's completion, CMI submitted invoices to CDA for payment totaling $123, 621. CDA then submitted $50, 000 in payment to CMI after receiving a check for the same amount and purpose from Patel of Little River. This was the only payment CMI received for the work. Although an internal CDA document recognized a $61, 259 balance due CMI on the subcontracting work, Patel later claimed he understood the $50, 000 payment to be the complete amount due CMI for the project.

Little River and CDA did not memorialize their general contracting agreement for developing the property until October 2000. The contract states work shall not commence until all of the following are accomplished: 1) financing is in place and designated for the project; 2) a building permit is obtained and 3) written notice to proceed is received by CDA. Because construction financing could not be obtained, CDA never commenced contract performance. No hotel or other structure exists on the property today.

In the meantime, CMI served a summons, complaint, and notice and certificate of a mechanic's lien on the property on Little River on July 18, 2000 and to CDA on August 11, 2000. In addition to the mechanic's lien, CMI asserted a claim against Little River for unjust enrichment. The trial court awarded CMI a judgment of $100, 210.40, the lien plus interest and attorney's fees, against Little River. The court order also stated CMI was entitled to $73, 620.75 on its claim for unjust enrichment, but explained this award was superceded by CMI's judgment on its mechanic's lien.” This appeal followed.

STANDARD OF REVIEW

A proceeding to enforce a mechanic's lien is an action at law. Seckinger v. Vessel Excalibur, 326 S.C. 382, 386, 483 S.E.2d 775, 777 (Ct. App. 1997). In an action at law, on appeal of a case tried without a jury, the findings of fact of the judge will not be disturbed upon appeal unless found to be without evidence which reasonably supports the judge's findings. Townes Assocs. v. City of Greenville, 266 S.C. 81, 86, 221 S.E.2d 773, 775 (1976).

LAW / ANALYSIS

I. Subject Matter Jurisdiction

Little River argues the mechanic's lien foreclosure should be reversed because the trial court lacked subject matter jurisdiction over the matter due to untimely service. We disagree.

South Carolina Code section 29-5-90 provides, in pertinent part:

[A] lien shall be dissolved unless the person desiring to avail himself thereof, within ninety days after he ceases to labor on or furnish labor or material for such building or structure, serves upon the owner... a statement of a just true account of the amount due him... together with a description of the property intended to be covered by the lien... with the name of the owner of the property, if known.

S.C. Code Ann. § 29-5-90 (Supp. 2003). [b1] It is undisputed that CMI served this required notice and certificate of a mechanic's lien on Little River after the statutorily mandated ninety-day period. However, when questioned at trial regarding the sufficiency of the lien's service, the following exchange occurred between the trial court and counsel for Little River:

THE COURT: Is there an issue about the technical aspects of the mechanic's lien such as the notice, the certificate was given, the timing of the foreclosure of the mechanic's lien? All the technical aspects, is that an issue?

LITTLE RIVER: I think the mechanic's lien was served and everything.

THE COURT: I don't have the roll up here.

LITTLE RIVER: I've got some other points to argue, but it's not regarding service or whether the mechanic's lien was properly prepared.

The sufficiency of the lien's service was never again discussed or raised before the trial court.

While Little River certainly could have argued the timeliness of the mechanic's lien's service as valid grounds to dismiss the initial foreclosure action, it failed to do so. Generally, an issue cannot be raised for the first time on appeal, but must have been raised to and ruled upon by the trial judge to be preserved for appellate review. Wilder v. Wilke, 330 S.C. 71, 76, 497 S.E.2d 731, 733 (1998). However, Little River argues the issue of timeliness of service is one of subject matter jurisdiction and, as such, may be raised at any time, including for the first time on appeal. See Johnson v. State, 319 S.C. 62, 64, 459 S.E.2d 840, 841 (1995) (stating issues related to subject matter jurisdiction can be raised at any time).

Subject matter jurisdiction has been defined as the power to hear and determine cases of the general class to which the proceedings in question belong.” McLendon v. S.C. Dep't of Highways and Pub. Transp., 313 S.C. 525, 525-26, 443 S.E.2d 539, 540 (1994). In McLendon, the supreme court determined that a statute of limitations defense does not raise a question of subject matter jurisdiction. Id. at 525-26, 443 S.E.2d at 540. The supreme court extended this holding to the time limits set by statutes of creation. ^[2] Simpson v. Sanders, 314 S.C. 413, 415 n.1, 445 S.E.2d 93, 94 n.1 (1994). As such, issues of timeliness of service, even when they arise from the mandatory terms of statutes of creation, do not give rise to concerns of subject matter jurisdiction.

Thus, as Little River failed to raise to the trial court the issue of whether the mechanic's lien in this case was timely served, this issue is not properly preserved for our review.

II. Absence of a Structure on the Building Site

Little River contends the trial court erred in enforcing the mechanic's lien because the absence of a building or structure on the tract of land in question precludes attachment of the lien to the land. We disagree.

The South Carolina mechanic's lien statute provides:

A person to whom a debt is due for labor performed... in the erection, alteration, or repair of a building or structure upon real estate... by virtue of an agreement with, or by consent of, the owner of the building or structure, or a person having authority from, or rightfully acting for, the owner in procuring or furnishing the labor or materials shall have a lien upon the building or structure and upon the interest of the owner of the building or structure in the lot of land upon which it is situated to secure the payment of the debt due to him.

...

[L]abor performed... includes... the work making the real estate suitable as a site for the building or structure. The work is considered to include, but not be limited to, the grading, bulldozing, leveling, excavating, and filling of land...

S.C. Code Ann. § 29-5-10 (Supp. 2003).

Little River relies on Clo-Car Trucking Co., Inc. v. Clifflure Estates of South Carolina, 282 S.C. 573, 320 S.E.2d 51 (Ct. App. 1984), for the proposition that if no structure is erected on a tract of land, a mechanic's lien, by the plain language of the statute, cannot attach to the land. In Clo-Car Trucking, the contractor, pursuant to its contract with the previous owner, cleared and graded land for the construction of streets and roads. Neither the contractor nor anyone else did anything more to the land. This court held that, under section 29-5-10, a mechanic's lien cannot attach to land or to an owner's interest in land where the work done is unconnected with and forms no integral part of the erection, alteration, or repair of either a building or a structure of some description.” Clo-Car Trucking Co., Inc., 282 S.C. at 578, 320 S.E.2d at 54.

We find A.V.A. Construction Corporation v. Santee Wando Construction, 303 S.C. 333, 400 S.E.2d 498 (Ct. App. 1990), more instructive on this issue. In A.V.A Construction, the contractor had contracted to construct the tennis court, provide drainage facilities, build roads...