Crafton Contracting Co. v. Swenson Constr. Co., ED 102910

Citation495 S.W.3d 178
Decision Date12 April 2016
Docket NumberNo. ED 102910,ED 102910
CourtCourt of Appeal of Missouri (US)
Parties Crafton Contracting Company and Vogel Sheet Metal & Heating, Inc., Appellants, v. Swenson Construction Company, Inc., Allen Edmonds Corporation, and Plaza Frontenac Acquisition, LLC, Respondents.

Lester J. Hubble, 10024 Office Center Avenue, # 203, St. Louis, Missouri 63128, Ira M. Potter, 1610 Des Peres Road, Suite 100, St. Louis, Missouri 63131, for Appellants.

John Watt, 2400 Pershing Rd., Suite 500, Kansas City, Missouri 64108, for Respondents.

OPINION

James M. Dowd

, Judge

Crafton Contracting Company (Crafton) and Vogel Sheet Metal and Heating, Inc. (Vogel) appeal the trial courts judgment denying enforcement of the mechanic's liens they placed on the Plaza Frontenac shopping mall against its owner, Plaza Frontenac Acquisition, LLC (Plaza Frontenac). Because we find that the court erroneously declared and applied the law, we reverse and remand.

Facts and Procedural History

The facts are undisputed. On December 11, 2012, Plaza Frontenac and Allen Edmonds Corporation (Allen Edmonds) entered into a ten-year lease with Plaza Frontenac for store space at the Plaza Frontenac mall located on Lindbergh Boulevard in St. Louis County for the specific purpose of operating an Allen Edmonds shoe store. The lease required Allen Edmonds to make certain improvements to the leased premises as more specifically described below.

On December 13, 2012, pursuant to a requirement of the lease, Allen Edmonds submitted the plans for the improvements to Plaza Frontenac. Plaza Frontenac approved the plans. About a month later, Allen Edmonds accepted general contractor Swenson Construction Company, Inc.'s (Swenson) $207,398.40 bid for the work. Swenson subcontracted demolition, framework, drywall, carpentry, and barricade work to Crafton for $67,023.00, and heating, ventilating, and air conditioning work to Vogel for $15,975.00. Crafton and Vogel completed their portions of the project.

Allen Edmonds paid Swenson in full but Swenson never paid Crafton and Vogel for their work and Swenson went out of business in June 2013. Crafton and Vogel filed mechanic's liens on the mall against Plaza Frontenac and filed suit to enforce those liens.

The parties submitted the case to the court on stipulated facts and exhibits. The trial court entered its judgment in which it found that Crafton and Vogel's liens were unenforceable against Plaza Frontenac because Crafton and Vogel failed to establish that Allen Edmonds was Plaza Frontenac's agent under the mechanic's lien statute. This appeal follows.

Standard of Review

Both parties contend that this case is governed by the standard of review set forth in Murphy v. Carron, 536 S.W.2d 30, 31 (Mo.banc 1976)

, which requires this court to affirm unless there is no substantial evidence to support it, it is against the weight of the evidence, or it erroneously declares or applies the law. However, this is not the correct standard of review in this case.

This case was submitted to the trial court on exhibits and stipulated facts and was not one involving the resolution by the trial court of conflicting testimony.1 Thus, the only question for our review is whether the trial court made the proper legal conclusions from the stipulated facts. Schroeder v. Horack, 592 S.W.2d 742, 744 (Mo.banc 1979)

; Archey v. Carnahan, 373 S.W.3d 528, 531 (Mo.App.W.D.2012). Further, because this case was decided below based upon an interpretation of section 429.010,2 our review is de novo. Mo. Prosecuting Attorneys v. Barton Cnty ., 311 S.W.3d 737, 740 (Mo.banc 2010) ; Kohrs v. Family Support Div., Mo. Dept. of Soc. Servs ., 407 S.W.3d 85, 87 (Mo.App.W.D.2013).

Discussion
A. The trial court erred by strictly construing the mechanic's lien statute because under Missouri law the statute is to be construed favorably to uphold the rights of laborers and materialmen.

In its judgment, the court stated that it was constrained to follow section 429.010 strictly. However, under Missouri law, mechanic's liens statutes are to be construed favorably to uphold the rights of laborers and materialmen. Bob DeGeorge Assocs., Inc. v. Hawthorn Bank, 377 S.W.3d 592, 598 (Mo.banc 2012)

. We find that this fundamental misinterpretation of the law led to the trial court's erroneous interpretation of section 429.010.

B. The trial court erroneously applied the law when it found that Allen Edmonds was not Plaza Frontenac's agent under the mechanic's lien statute.

Section 429.010 provides that a mechanic's lien may be placed upon the owner's land for “any work or labor” completed upon such land by any person who contracts with the owner or his agent. At issue then is whether Allen Edmonds acted as Plaza Frontenac's agent when it contracted with Swenson who in turn hired Crafton and Vogel. If so, then Crafton and Vogel's mechanic's liens are enforceable against Plaza Frontenac.

Generally, there are three essential elements to an agency relationship: 1) the agent holds the power to alter the legal relations between the principal and a third party; 2) the agent is a fiduciary with respect to matters within the scope of the agency; and 3) the principal has the right to control the conduct of the agent with respect to matters entrusted to the agent. State ex rel. Ford Motor Co. v. Bacon, 63 S.W.3d 641, 642 (Mo.banc 2002)

. However, the term “agent” as used in section 429.010 is to be interpreted broadly and the level of authority required to create an agency relationship for purposes of a mechanic's lien is less than required in other contexts. River City Drywall, Inc. v. Raleigh Properties, Inc., 341 S.W.3d 716, 721 (Mo.App.E.D.2011) (citing Ward v. Nolde, 259 Mo. 285, 168 S.W. 596, 600 (1914) ). It is not a typical principal-agent relationship, but rather, a special, limited agency arising out of section 429.010. Mid–West Eng'g & Constr. Co. v. Campagna, 397 S.W.2d 616, 628 (Mo.1965)

The determination of whether an agency relationship has been created in the mechanic's lien context often centers on the terms and requirements of the lease. See Messina Bros. Constr. Co. v. Williford, 630 S.W.2d 201, 207 (Mo.App.W.D.1982)

. When a lease requires the lessee to make improvements of a substantial and permanent nature, the lessee, in making such improvements, becomes, as a matter of law, the agent of the lessor within the meaning of the mechanic's lien law. Campagna, 397 S.W.2d at 625–26

; Ward, 168 S.W. at 600 ; Williford, 630 S.W.2d at 206. The crux of the matter is whether the lessee is required by the lease to make the improvements. Ward, 168 S.W. at 600. If the lessee is not required to make the improvements and makes them on his own, no agency is established. Id. But where the lessee has no option and he is compelled by the lease to make the improvements, agency is established and the mechanic's lien is enforceable on the property against the owner. Id.

Turning to the circumstances of this case, we find that Allen Edmonds was Plaza Frontenac's agent because the lease required Allen Edmonds to make substantial and permanent improvements to the property. See Campagna, 397 S.W.2d at 625–26

. As a result, we hold that under Missouri law, Crafton and Vogel were entitled to place their mechanic's liens on the mall and enforce them against Plaza Frontenac.

Indeed, it is difficult to imagine a lease in which the lessor has more control and requires more of the lessee than the lease between Plaza Frontenac and Allen Edmonds. The following lease provisions illustrate this point:

1. The lease permitted the premises to be used as an Allen Edmonds shoe store and for no other purpose whatsoever. See Newport v. Hedges, 358 S.W.2d 441, 444–45 (Mo.App.1962)

(noting that an implied agency is found where the premises are let for a specific use or purpose and such purpose cannot be accomplished except by the making of substantial improvements).

2. The lease required Allen Edmonds to submit plans for the work to Plaza Frontenac for Plaza Frontenac's approval and prohibited Allen Edmonds from starting any work on the project until the plans were approved. See Ward, 168 S.W. at 601 (finding agency where improvements tenant was required to make were according to plans and specifications approved by landlord).

3. The lease required Allen Edmonds to perform a complete build-out of the leased premises to conform with Allen Edmonds's other stores, including the bump-out of the southern storefront; installation of storefronts and storefront signs; customer entrance doors; floor covering; plastering; interior decorating; wall and ceiling treatment; completion of the air conditioning and fire sprinkler system; extension of electrical service to the leased premises; connection of plumbing lines to the Plaza Frontenac system; the installation of electric lights and fixtures; and all other electrical work.

4. Allen Edmonds's contractor was required to give Plaza Frontenac a security deposit so Plaza Frontenac could complete the work if it was not finished. See Ward, 168 S.W. at 601 (noting that bond requirement was relevant fact to consider in determining agency).

5. Plaza Frontenac had the right to approve Allen Edmonds's contractors and subcontractors.

6. Allen Edmonds was required to have its contractors cooperate with Plaza Frontenac and correct any deficiencies noted by Plaza Frontenac.

7. All of the improvements became the property of Plaza Frontenac at the end of the lease. See Newport, 358 S.W.2d at 445 (noting that whether

improvements revert to the owner at the end of the lease is but one factor to be considered in determining the intention of the parties); Curtin–Clark Hardware Co. v. Churchill, 126 Mo.App. 462, 104 S.W.476, 478 (1907)

(finding that the landlord intended to derive a substantial benefit by requiring that the improvements were to pass to the landlord...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT