Foley Lumber Co. v. Koester

• Decision Date: 21 November 1952
• Citation: 61 So.2d 634
• Parties: FOLEY LUMBER CO. et al. v. KOESTER et al.
• Court: Florida Supreme Court

Page 634

61 So.2d 634

FOLEY LUMBER CO. et al. v. KOESTER et al.

Supreme Court of Florida, Special Division B.

Nov. 21, 1952.

Latham & Elmore, Jacksonville, for appellants.

Rogers, Towers & Bailey, C. D. Towers and Taylor Jones, Jacksonville, for appellees.

GORDON, Associate Justice.

This suit was instituted by the appellants, Foley Lumber Company, a materialman, and H. W. Moyer, d/b/a Moyer Marble and Tile Company, a tile subcontractor, seeking to enforce a lien against the home of the appellees, E. A. Koester and Lucile I. Koester, his wife, for building materials and tile work furnished during the construction of their home. As the facts are not the same in the Foley case as they are in the Moyer case, they will be discussed separately.

The record in the Foley case discloses that the Koesters, who were the owners of the property against which a lien is claimed, desired to build a home.

In August, 1951, they discussed with Leeds and Brinn, the contractors, their desire. Mr. Leeds said he 'understood' he ahd a cost plus 5% deal with the Koesters to build and construct the house. The Koesters, on the other hand, said there was no cost plus contract but instead that they at all times wanted to build only if they had a firm contract for a fixed price.

On or about September 7th or 8th, work was started on the property in question by the digging of ditches for the foundation.

On September 28th, after some discussion on September 27th, a contract was executed by the Koesters and Leeds and Brinn providing that the Koesters would pay $15,000 for the home to be constructed and Leeds and Brinn agreed to 'furnish all materials and perform all work necessary' to complete the home, 'the total expenses of all labor and materials shall not exceed $15,000.00 Dollars'.

Prior to September 27th, Leeds and Brinn had told Foley Lumber Company that they were building this job on a 'cash' basis. Foley, thereupon, began to furnish materials to the Koester job and billed the materials to S. E. Leeds, one of the contractors. At no time were any materials billed or charged to the Koesters, nor did Foley deal with the Koesters in any way.

The testimony further revealed that Leeds requested Koester to make one check for $3,000, payable direct to the Foley Lumber Company, which was done, and the amount credited to Leed's account.

In January, 1951, several months after the date of the execution of the contract, Koester discovered that some workmen were having difficulty getting their money from Leeds and after paying the workmen he decided to check further. He went with Leeds to Foley Lumber Company and there found out for the first time that a large bill was still due Foley for materials furnished in the construction of his home.

At that time, Koester only owed to the contractors, Leeds and Brinn, the sum of $446.95, having paid the difference in that amount and $15,000 to the contractors under the terms of the contract.

Foley claimed Koester should pay them in full and Koester claimed the extent of his liability was only for the contract price. Foley then filed a lien and this action was commenced. It is admitted that no cautionary notices were given by Foley to the Koesters. Koester, having withheld the sum of $446.95 from the contractors, deposited that sum into the registry of the court.

The court below referred the cause to a special master to take testimony and he submitted the following conclusions:

1. That the Koesters entered into a contract with Leeds and Brinn, for the construction of their home for a definite price of $15,000.

2. That a proposition submitted by Moyer was never accepted in writing, though apparently Moyer did work on the basis of the proposition, and found an unpaid balance due to Moyer of $705.

3. That there was no cautionary notice given by any of the lien claimants.

4. That the total amount due the lien claimants from the Koesters was $446.95, which sum had been paid into the registry of the court.

Exceptions were filed by the appellants, Foley Lumber Company any Moyer, and the court below entered a final decree confirming the master's report, excepting only the conclusion of law that the appellant, Moyer, was entitled to share in the fund of $446.95, paid by the Koesters into the registry of the court, and entered judgment against the contractors in favor of Moyer, for the entire amount due in the sum of $705, from which order the appellants have perfected this appeal.

This court has consistently held that a materialman's lien, being strictly statutory, requires that before a lien claimant can enforce his lien, he must allege and prove a strict compliance with every requirement of the statute. Southern Paint Manufacturing Company v. Crump, 132 Fla. 799, 182 So. 291. We have also recognized that one of the cardinal purposes of the Mechanics' Lien Law was to protect the laborer in the collection of his wages. See Florida Fruit Co. v. Shakelford, 145 Fla. 216, 198 So. 841.

A careful examination of the Mechanics' Lien Law, Section 84.01 et seq., Florida Statutes 1941, F.S.A., will reveal that there is provided therein adequate means of protection for the laborers, materialmen, and subcontractors, but such lienors must avail themselves of the protection afforded them by the statutes. A materialman cannot sit idly by extending unlimited credit to the contractor, month after month, permitting the owner to make progress payments in good faith to the contractor and then expect the owner to pay for the house a second time. See Hendry Lumber Co. v. Bryant, 138 Fla. 485, 189 So. 710. This is especially true when there is a contract between the contractor and the owner, as appears in the instant case at bar, that is entered into in good faith setting forth the total contract price. This contract is binding upon a materialman dealing with the contractor and not the owner in the absence of any fraud in the original contract or in the amount of payment made to the contractor. See Trustees Wylly Academy v. Sanford, 17 Fla. 162.

It is apparent from the testimony that the appellant, Foley Lumber Company, did not fully know or understand the arrangement between the contractor and the owners. It frequently happens in the construction of buildings that the materialman, in dealing with the contractor, will not know under what arrangements the contractor is operating or what amounts are due or to become due to the contractor. In this regard, the Mechanics' Lien Law, section 84.25, F.S.A., provides adequate protection for the materialman as follows:

'(1) A copy of the contract of a contractor or sub-contractor and a statement of the amount due or to become due thereon, shall be furnished by the owner or contractor, party thereto, upon demand of a lienor contracting with or employed by the other party to such contract.'

The effect of a refusal or neglect to furnish a copy of the contract, or a willful and false statement, is 'that the lienor may proceed to judgment and execution against the person primarily liable for the debt and if execution is returned wholly or partly unsatisfied, the owner or contractor of whom the copy or statement was demanded, shall be liable for the loss sustained by the lienor, and (shall) be enforced in the same manner as if such labor, services, or materials had been directly performed for or furnished to such owner'.

The materialman in dealing directly with the contractor in the construction of an improvement upon property, will tend to place his confidence in and trust the contractor rather than the owner. It is upon his same theory of confidence and trust, or fear of offending the contractor, that the materialman has often delayed to his detriment the filing of his notice of intention of claiming a lien upon the owner. Section 84.04(1)(a), Florida Statutes 1941, F.S.A., provides that '* * * any lienor, or any prospective lienor may, before beginning, or within thirty days after beginning but not later than the day of completing his labor or services or his furnishing of materials, give to the owner a written notice of intention to claim a lien * * *.' This in effect requires the owner to retain funds in his hands for the satisfaction of said claims. Section 84.05(8).

Although a materialman's lien may be valid without the necessary compliance with Section 84.04, Florida Statutes 1951, F.S.A., where there is a valid contract in existence between the contractor and the owner, the materialman will be allowed to recover from the owner only to the extent that there is remaining with the owner money unpaid to the contractor.

The law specifically provides that the aggregate of all liens may not exceed the unpaid balance of the contract price at the time the lienors perfect their liens either by giving notice of intention to claim a lien or by filing and...