Meco Systems v. Dancing Bear Entertainment

• Decision Date: 14 February 2001
• Citation: 42 S.W.3d 794
• Parties: (Mo.App. S.D. 2001) Meco Systems, Inc., Plaintiff-Appellant, and Artisan Construction Services, Inc., Intervenor Plaintiff-Cross-Claimant-Respondent, v. Dancing Bear Entertainment, Inc., Defendant, Empire Bank, Defendant-Respondent, and William A. R. Dalton, Trustee for Empire Bank, Defendant-Respondent, and Delvan Mitchell Ceiling Company, John O'Neal d/b/a John O'Neal Sheet Metal, Table Rock Asphalt, and William J. Zickel, Intervenors-Respondents, and Ronald C. Middleton, et al., Defendants. 23093 0
• Court: Missouri Court of Appeals

42 S.W.3d 794 (Mo.App. S.D. 2001)

Meco Systems, Inc., Plaintiff-Appellant, and Artisan Construction Services, Inc., Intervenor Plaintiff-Cross-Claimant-Respondent, v. Dancing Bear Entertainment, Inc., Defendant, Empire Bank, Defendant-Respondent, and William A. R. Dalton, Trustee for Empire Bank, Defendant-Respondent, and Delvan Mitchell Ceiling Company, John O'Neal d/b/a John O'Neal Sheet Metal, Table Rock Asphalt, and William J. Zickel, Intervenors-Respondents, and Ronald C. Middleton, et al., Defendants.

23093

Missouri Court of Appeals Southern District

02/14/2001

Appeal From: Circuit Court of Taney County, Hon. James L. Eiffert

Counsel for Appellant: Lincoln Knauer and Lee J. Viorel

Counsel for Respondent: Joseph Bohrer, Lynn Rodgers, Douglas Evans, Robert Asperger, II, Christopher Stark, Richard Schnake and David Smith

Opinion Summary: None

Prewitt, J., and Barney, C.J., concurs. Parrish, P.J., and Montgomery, J., recuses.

Kenneth W. Shrum, Judge

This appeal arises from a mechanic's lien case and suit for damages by MECO Systems, Inc. ("MECO") against Dancing Bear Entertainment, Inc. ("DBE"), owner of the Charley Pride Theater at Branson, Missouri. In a counterclaim, DBE sought liquidated damages per a contract clause because of MECO's alleged failure to timely complete construction. Other parties to this case who have filed briefs with this court are Empire Bank (holder of first deed of trust), its trustee, and some of MECO's subcontractors who joined the litigation as intervenors. The trial court (a) denied MECO's request for a mechanic's lien, (b) entered judgment for MECO against DBE for unpaid construction costs, (c) rendered money judgments for subcontractors against MECO, (d) awarded liquidated damages to DBE and against MECO, (e) gave some subcontractors first lien status, and (f) denied MECO's claim for unjust enrichment. MECO appeals advancing multiple claims of trial court error. We affirm.

REVIEW STANDARDS

Review of mechanic's lien and contract suits is under Rule 84.13(d). White River Dev. v. Meco Systems, 806 S.W.2d 735, 736 (Mo.App. 1991).¹ As that rule is construed, we are to affirm the judgment unless there is no substantial evidence to support it, the judgment is against the weight of the evidence, erroneously declares the law, or erroneously applies the law. Id. at 736-737. "A judgment is to be set aside because it is against the weight of the evidence only with caution and with a firm belief that the . . . judgment is wrong." Id. at 737.

The phrase "weight of the evidence" refers to "its weight in probative value, not its quantity." Id. The weight of evidence is determined by its effect in inducing belief, not by mathematics. Id.

Appellate courts give due regard to the trial court's determination on the credibility of witnesses. Id. "The trial judge as the trier of fact can disbelieve testimony even where uncontradicted." Id.FACTUAL SYNOPSIS -- MECO'S MECHANIC'S LIEN CLAIM

On August 25, 1993, MECO and DBE entered into a contract under which MECO, a corporation, would build a theater at Branson, Missouri, for DBE, a corporation. The August 25, 1993, document (herein the "Main Contract") had two parts, namely, a "Standard Form of Agreement Between Owner and Contractor" produced by the American Institute for Architects ("AIA") and an "Amendment" prepared by DBE's lawyer. MECO's work under the Main Contract was described as "site preparation, parking lot paving, parking lot lighting, and construction of the Theater Building, complete." In return, DBE agreed to pay MECO for "Cost of the Work," defined as the cost of labor, materials, equipment, payments made under MECO's subcontracts, and incidental costs as described therein. Also, DBE agreed to pay MECO a contractor's fee of six and one-half percent of the total job cost.

When the AIA contract form was signed, the parties were awaiting a building permit from the city of Branson. Also, DBE's financing needs had not been met. The parties addressed these issues in the Amendment, as follows:

"2. . . . In the event [the] building permit is obtained prior to the close of [DBE's] construction financing, the date of commencement shall be no later than five (5) days following the date of closing of [DBE's] construction financing.

. . . .

"7. The parties . . . agree that the Agreement shall be contingent and conditioned upon the closing and funding of all financing to be provided to [DBE] for acquisition of the site and construction of the improvements described herein."

On August 26, 1993, MECO obtained a grading permit. However, neither the financing nor building permit had been obtained by August 31, 1993. Accordingly, on August 31, 1993, DBE's lawyer sent a letter to MECO that provided, inter alia:

"[DBE's] financing contingency is not yet satisfied . . . . Although we do not expect any problems . . . [DBE] is not yet in a position to waive the contingency for the closing of financing under the Addendum. However, [DBE] . . . does not want to hold up MECO . . . from its time schedules. Therefore, [DBE] has instructed me to advise [MECO] to proceed with grading and work under the contract for the next ten (10) days subject to a Stop Work Order in the event any problems arise in satisfying the financing contingencies. Proceeding in this manner, [DBE] will be responsible only for the work actually performed during this period of time until a Stop Work Order is issued."DBE's letter advised MECO if it found the proposal agreeable, it should sign and return a copy of the letter to DBE. MECO did agree, signed the letter, and returned it as directed. MECO then commenced and worked on site preparation for ten days.

On September 10, 1993, DBE's lawyer wrote to MECO and authorized an additional ten days' work "pursuant to the terms of my letter of August 31, 1993, and the above-referenced contract and the Addendum thereto." As before, DBE cautioned that its "authorization [for ten days' site work] is without waiver of any provision in the contract or its addendum."

When the second ten-day period passed without DBE's financing in place, MECO wrote DBE on September 20, 1993, as follows:

"We understand you anticipate closing . . . the financing . . . September 21, which will enable you to waive the [financing] contingency . . . and release us to proceed with all buy-out of the project. We look forward to that release.

"In the meantime, please sign and return a copy of this letter authorization for MECO . . . to order . . . steel . . . and Building parts . . . .

"Signing of this letter will also authorize continuance of the site preparation past today's date. . . ."

DBE signed and returned the letter to MECO with this notation: "Authorization to continue work extended to September 30, 1993 pursuant to terms of prior correspondence authorizing commencement of work."

On September 29, 1993, DBE's lawyer wrote MECO advising DBE was releasing "the financing contingency set forth in the Addendum." On October 4, 1993, MECO sent DBE a labor and material invoice that covered the period July 9 through September 25, 1993. The invoice amount was $52,938.41. It did not, however, contain the mechanic's lien notice mandated by section 429.012. In late October 1993, DBE paid the invoice amount ($52,938.41) without having previously received a section 429.012 notice from MECO.²

MECO next billed DBE on November 4, 1993, with a document entitled "Invoice 2." This invoice contained the notice mandated by section 429.012, as did all subsequent monthly invoices submitted by MECO to DBE. DBE timely paid MECO on the invoices until June 1994. MECO in turn promptly paid its subcontractors during those periods.

On June 2, 1994, MECO billed DBE for $872,344.91 for work from May 1, 1994, through May 28, 1994. DBE only paid part of this billing and never fully paid later invoices submitted by MECO.

Once DBE quit paying MECO, it (MECO) stopped paying its subcontractors. MECO's refusal to pay its "subs" was based on a "pay if paid" provision in the contracts between MECO and its subcontractors.

The cessation of payments led to a morass of litigation and ultimately to the judgment summarized in the opening paragraph of this opinion. Additional facts are given when needed to analyze points relied on.

MECO'S FAILURE TO COMPLY WITH BRIEFING REQUIREMENTS OF RULE 84.04

At the outset, we are confronted with motions and argument by several respondents to strike or dismiss four of MECO's five points on appeal for failure to comply with the briefing requirements of Rule 84.04. Those motions, taken with the case, are denied.

We caution, however, this ruling does not mean we find that the points in MECO's brief comply with Rule 84.04. They do not comply. This excerpt from another mechanic's lien case, Norman v. Ballentine, 627 S.W.2d 83 (Mo.App. 1981), explains our decision to address MECO's claims of trial court error:

"Inadequate briefs of counsel are a disservice to parties so represented and a burden on the system of justice. See Thummel v. King, 570 S.W.2d 679, 686 (Mo.banc 1978). Because of the result here reached, however, suspension of strict application of Rule 84.04 will work no hardship on the respondent. Our jurisdiction is apparent from the record, and we have been able to determine the facts of the case and the issues to be decided from the briefs and transcript. A punitive order of dismissal would serve no purpose here, but we trust that members of the bar will take heed of the warning implicit in our discussion of this matter."

Id. at 85.

DISCUSSION AND DECISION

POINT I: DENIAL OF MECO'S REQUEST FOR MECHANIC'S LIEN

The trial court denied MECO'S claim for a mechanic's lien because it found MECO did not comply with section 429.012. Specifically the court found MECO failed "to provide the required notice with the first invoice."

In pertinent part, section 429.012.1 provides:

"1. Every original contractor, who shall do . . . work . . . or...