Halbert's Lumber, Inc. v. Lucky Stores, Inc.

• Decision Date: 26 May 1992
• Docket Number: No. G009097,G009097
• Citation: 8 Cal.Rptr.2d 298,6 Cal.App.4th 1233
• Parties: HALBERT'S LUMBER, INC., Plaintiff and Appellant, v. LUCKY STORES, INC., et al., Defendants and Respondents.
• Court: California Court of Appeals

Page 298

8 Cal.Rptr.2d 298

6 Cal.App.4th 1233

HALBERT'S LUMBER, INC., Plaintiff and Appellant, v. LUCKY STORES, INC., et al., Defendants and Respondents.

No. G009097.

Court of Appeal, Fourth District, Division 3, California.

May 26, 1992.

Review Denied Aug. 27, 1992.

Hunt, Ortmann, Blasco, Palffy & Rossell, Gordon Hunt and Ronald E. White, Pasadena, for plaintiff and appellant.

Voss, Cook, Casselberry & Thel and Edward L. Laird, Newport Beach, for defendants and respondents.

OPINION

SILLS, Presiding Justice.

INTRODUCTION

This case presents a real doozy of a puzzle in mechanics' lien law. What is the scope of the "conditional waiver release" of mechanics' lien rights prescribed by Civil Code section 3262, subdivision (d)(1)? This statute specifies the language and format of a release of mechanics' lien rights in return for a progress payment. The parties here used a release form following the statutory language virtually verbatim.

Two questions confront us. The first is the meaning of the word "furnished" as used in the release form. Does "furnished" mean delivery of materials to a construction site, or does it mean the actual use or incorporation of those materials into the structure?

This is the less difficult of the two questions. The ordinary meaning of "furnished" is delivery to the job site.

The second question is the extent of the mechanics' lien rights that are being released. Does the release extend only to the materials for which the supplier has actually been compensated, or does it extend to all materials furnished through the date of the progress payment? Both the statutory language and legislative history on this point are ambiguous; they shine like a dim lantern though a frosty window in a snowstorm.

In such a case, where neither language nor legislative intent are readily discernable, we are forced to interpret the statute to make it reasonable, practical, and avoid an absurd result. In so doing, we affirm the decision of the trial judge. A release is intended to be a release, not a glorified receipt. If the release form here only covered mechanics' lien rights to the extent the payment actually compensates for the materials furnished, the Legislature need not have bothered. The statute would be mere surplusage and accomplish nothing.

FACTS

In November 1985, Near-Cal Corporation (the general contractor) agreed to build a supermarket for Lucky Stores, Inc. (the owner) in Fountain Valley. In February 1986, M & F Development and Construction (the subcontractor) agreed with the general contractor to provide rough framing. On April 22, 1986, the subcontractor placed an order with Halbert's Lumber, Inc. (the lumber company) for about two truckloads of glu lam beams for use in the project. The subcontractor needed the beams as soon as possible.

The order was too large for the lumber company to supply from its own yard, so it placed an order with Laminated Timber Service to have the beams shipped directly to the job site. The lumber company did not bill the subcontractor for the beams at that time; its practice was not to bill its customers when it placed an order, but wait until it received proof the materials were on the job site.

The beams arrived on May 12, 1986, and May 15, 1986, when they were delivered to a parking lot. About May 20, 1986, the subcontractor told the lumber company it wanted a release of the lumber company's lien rights through May 19. The lumber company signed a release, which read:

CONDITIONAL WAIVER RELEASE

UPON PROGRESS PAYMENT

Upon receipt by the undersigned of a check from [the general contractor] in the sum of $24,187.09 payable to [the lumber company] and when the check has been properly endorsed and has been paid by the bank upon which it was drawn, this document shall become effective to release pro tanto* any mechanic's lien, stop notice, or bond right the undersigned has on the job of [the owner] located at Brookhurst & Ellis in the city of Fountain Valley, California, to the following extent. This release covers a progress payment for materials furnished to [the subcontractor] through May 19, 1986 only and does not cover any retention or items furnished after said date. Before any recipient of this document relies on it, said party should verify evidence of payment to the undersigned.

Dated: May 20, 1986

By Russell Halbert

Title VP/Gen. Mgr.

When it signed the release, the lumber company had not yet posted the cost of the beams for billing to the subcontractor. The $24,187.09 figure was based on five or six invoices for other lumber which had been posted prior to May 20. The lumber company was not aware the beams were already at the job site and the figure did not include the cost of those beams, although it did have the invoice showing the subcontractor's order in April and a "due in" date of May 12.

The beams were installed in the period June 3 through June 5. About four days later, on June 9, the lumber company posted its invoice on the subcontractor's order for the beams for billing to the subcontractor. The earlier claim for $24,187.09 was paid in early July.

The lumber company was never compensated for the beams, however. The general contractor terminated its contract with the subcontractor, and the subcontractor eventually filed for bankruptcy, listing the lumber company as one of its creditors. In August, the lumber company filed a mechanic's lien for $70,122.04--a figure which did include the beams as well as lumber delivered after the release. In October a bond to release the mechanic's lien was filed, and in November the lumber company filed this lawsuit. Because of the release, the judgment of the trial court did not allow the lumber company to recover the cost of the beams from the issuer of the bond, and from that judgment the lumber company appeals.

DISCUSSION

The Problem of Statutory Interpretation

More than forty years ago, Karl Llewellyn authored a now classic law review article in which he took great delight in listing, side by side, contradictory maxims of statutory interpretation. ¹ Llewellyn's thesis was that judges pick and choose among the rules to arrive at a result consonant with their own judicial temperament and philosophy.

At its logical extreme, Llewellyn's thesis would mean there is no law when it comes to the interpretation of law itself. It all depends on the "felt need" emanating from the particular "situation" and "controversy" before the court. ² But the rules of statutory interpretation are not quite so plastic as Llewellyn's article might lead us to believe. There is order in the most fundamental rules of statutory interpretation if we want to find it. The key is applying those rules in proper sequence.

First, a court should examine the actual language of the statute. (Mercer v. Department of Motor Vehicles (1991) 53 Cal.3d 753, 763, 280 Cal.Rptr. 745, 809 P.2d 404; Curl v. Superior Court (1990) 51 Cal.3d 1292, 1300, 276 Cal.Rptr. 49, 801 P.2d 292; Solberg v. Superior Court (1977) 19 Cal.3d 182, 198, 137 Cal.Rptr. 460, 561 P.2d 1148; Leroy T. v. Workmen's Comp. Appeals Bd. (1974) 12 Cal.3d 434, 438, 115 Cal.Rptr. 761, 525 P.2d 665; Moyer v. Workmen's Comp. Appeals Bd. (1973) 10 Cal.3d 222, 230, 110 Cal.Rptr. 144, 514 P.2d 1224.) Judges, lawyers and laypeople all have far readier access to the actual laws enacted by the Legislature than the various and sometimes fragmentary documents shedding light on legislative intent. More significantly, it is the language of the statute itself that has successfully braved the legislative gauntlet. It is that language which has been lobbied for, lobbied against, studied, proposed, drafted, restudied, redrafted, voted on in committee, amended, reamended, analyzed reanalyzed, voted on by two houses of the Legislature, sent to a conference committee, and, after perhaps more lobbying, debate and analysis, finally signed "into law" by the Governor. The same care and scrutiny does not befall the committee reports, caucus analyses, authors' statements, legislative counsel digests and other documents which make up a statute's "legislative history."

In examining the language, the courts should give to the words of the statute their ordinary, everyday meaning (e.g., People ex rel. Younger v. Superior Court (1976) 16 Cal.3d 30, 40, 127 Cal.Rptr. 122, 544 P.2d 1322; Merrill v. Department of Motor Vehicles (1969) 71 Cal.2d 907, 918, 80 Cal.Rptr. 89, 458 P.2d 33; see also Mercer v. Department of Motor Vehicles, supra, 53 Cal.3d at p. 763, 280 Cal.Rptr. 745, 809 P.2d 404 [traditional and plain meaning] ) unless, of course, the statute itself specifically defines those words to give them a special meaning (Security Pacific National Bank v. Wozab (1990) 51 Cal.3d 991, 998, 275 Cal.Rptr. 201, 800 P.2d 557; Great Lakes Properties, Inc. v. City of El Segundo (1977) 19 Cal.3d 152, 156, 137 Cal.Rptr. 154, 561 P.2d 244).

If the meaning is without ambiguity, doubt, or uncertainty, then the language controls. (Security Pacific National Bank v. Wozab, supra, 51 Cal.3d at p. 998, 275 Cal.Rptr. 201, 800 P.2d 557; Delaney v. Superior Court (1990) 50 Cal.3d 785, 798, 268 Cal.Rptr. 753, 789 P.2d 934; In re Waters of Long Valley Creek Stream System (1979) 25 Cal.3d 339, 348, 158 Cal.Rptr. 350, 599 P.2d 656; Great Lakes Properties, Inc. v. City of El Segundo, supra, 19 Cal.3d at p. 155, 137 Cal.Rptr. 154, 561 P.2d 244; Armstrong v. County of San Mateo (1983) 146 Cal.App.3d 597, 610, 194 Cal.Rptr. 294; Smith v. Rhea (1977) 72 Cal.App.3d 361, 365, 140 Cal.Rptr. 116.) There is nothing to "interpret" or "construe." (Lungren v. Deukmejian (1988) 45 Cal.3d 727, 735, 248 Cal.Rptr. 115, 755 P.2d 299; IGA Aluminum Products, Inc. v. Manufacturers Bank (1982) 130 Cal.App.3d 699, 703, 181 Cal.Rptr. 859; Roulston v. Pacific Tel. & Tel. Co. (1979) 96 Cal.App.3d 149, 154, 158 Cal.Rptr. 43; People v. Flores (1979) 92 Cal.App.3d 461, 472, 154 Cal.Rptr. 851; Skivers v. State of California (1970) 13...