Metropolitan Life Ins. Co. v. Rowell, 9226SC877

• Decision Date: 01 March 1994
• Docket Number: No. 9226SC877,9226SC877
• Parties: METROPOLITAN LIFE INSURANCE CO., Plaintiff, v. C.E. ROWELL, Defendant.
• Court: North Carolina Court of Appeals

Page 283

440 S.E.2d 283

113 N.C.App. 779

METROPOLITAN LIFE INSURANCE CO., Plaintiff, v. C.E. ROWELL, Defendant.

No. 9226SC877.

Court of Appeals of North Carolina.

March 1, 1994.

Petree Stockton by David B. Hamilton and B. David Carson, Charlotte, for plaintiff-appellee.

William G. Robinson, Charlotte, for defendant-appellant.

JOHNSON, Judge.

Plaintiff brought suit against defendant both to enjoin him from selling an apartment project at execution sale while enforcing his lien obtained in an action entitled C.E. Rowell v. Tantilla Associates, 89 CVS 7238 Mecklenburg County Superior Court, and to determine the relative priority of security as between plaintiff and defendant.

In August 1986, defendant C.E. Rowell, from South Carolina, first began to supply labor and materials to the construction of a 53 unit apartment project in Charlotte. The owner of the project was Tantilla Associates (Tantilla), a North Carolina general partnership operated by two general partners, Carl and Joe Schneider. The general contractor for this project was Waller Development, Inc. (Waller) who was licensed in North Carolina. Waller did not perform any work on the project; Waller only went to the job site once or twice and was accommodating Carl Schneider by serving as the general contractor.

Defendant's contract with Tantilla was basically to work until the job was completed and to complete certain jobs commonly referred to as subcontract work. Tantilla was to pay defendant for these jobs, at a rate of one half the savings to Tantilla, based on the other subcontract bids Tantilla had obtained. Carl Schneider asked defendant to hold out until the end of the job and he would be paid in full. Defendant performed his last work 29 December 1988.

On 19 December 1988, which was ten days before defendant's last performance of work, Tantilla executed a deed of trust on the real property to Metropolitan Life Insurance Co. (Metropolitan) to secure a $1,680,000.00 loan. Waller executed a contractor's affidavit on 9 December 1988 to evidence to Tantilla that Waller had performed his general contractor obligations and to induce Metropolitan to make this loan to Tantilla. The affidavit stated that as "general contractor," Waller constructed certain improvements which included the apartment complex; that Waller had been paid in full for construction at the property; and that

[a]ll work, labor, services and materials utilized in the construction of the Improvements were furnished and performed at the instance of General Contractor, as general contractor, for and on behalf of Owner, and that General Contractor has paid in full all subcontractors, suppliers, laborers and materialmen for all work, labor and services performed on, and has fully and completely paid for all materials supplied or ordered for or used in connection with the Improvements, at the agreed price therefor or reasonable value thereof.

On 14 April 1989, defendant timely filed a claim of lien pursuant to North Carolina General Statutes § 44A-8 (1989) asserting a lien against the real property for labor and materials supplied in its improvement. On or about 12 June 1989, defendant filed a complaint against Tantilla and the Schneiders to enforce the lien by sale of the real property pursuant to North Carolina General Statutes §§ 44A-13 and 44A-14 (1989). On 10 June 1991, a judgment was entered in favor of defendant and against Tantilla and the Schneiders. The judgment awarded a total of $267,700.00 to defendant, with interest at the legal rate from 29 January 1989. The judgment further ordered a sale of the property to enforce the lien.

On or about 3 October 1991, defendant had execution issued upon the judgment. Pursuant to this execution, defendant sought sale of the real property at public auction. Subsequently, Metropolitan filed the action which is the subject of this appeal, seeking injunctive relief preventing defendant's execution sale of the property. Metropolitan filed a motion for summary judgment which the court granted, finding that the lien of the deed of trust had priority over defendant's lien. In addition, the court denied a summary judgment motion filed by defendant. Defendant filed timely notice of appeal.

Defendant argues that the trial court erred when it granted summary judgment for plaintiff and denied defendant's summary judgment motion. Defendant argues that because defendant contracted only with the owner, defendant's lien rights were not waived under Waller's contractor's affidavit, because plaintiff did not establish that defendant was a first-tier sub-contractor under Waller. As a result, defendant claims that due to the relation-back nature of defendant's judgment lien, defendant has priority over plaintiff's deed of trust.

Plaintiff, however, contends that the dispositive issue on appeal is not whether defendant was a prime contractor or sub-contractor, but rather, whether the judgment is an ordinary judgment lien because the judgment imposed fails to meet the requirements of North Carolina General Statutes § 44A. If the judgment is an ordinary judgment lien, the judgment is effective from the date of entry.

Summary judgment is appropriate where there is no genuine issue as to any material fact and a party is entitled to judgment as a matter of law. N.C.R.Civ.P. 56. Burton v. NCNB, 85 N.C.App. 702, 355 S.E.2d 800 (1987). The goal of summary judgment is to allow the disposition before trial of an unfounded claim or defense. Cutchin v. Pledger, 71 N.C.App. 279, 321 S.E.2d 462 (1984).

North Carolina General Statutes § 44A-8 states:

Mechanics', laborers' and materialmen's lien; persons entitled to lien.

Any person who performs or furnishes labor or professional design or surveying services or furnishes materials pursuant to a contract, either express or implied, with the owner of real property for the making of an improvement thereon shall, upon complying with the provisions of this Article, have a lien on such real property to secure payment of all debts owing for labor done or professional design or surveying services or material furnished pursuant to such contract.

North Carolina General Statutes § 44A-10 (1989) states that "[l]iens granted by this Article shall relate to and take effect from the time of the first furnishing of labor or materials at the site of the improvement by the person claiming the lien." Liens granted by the Article are perfected upon filing of the claim of lien pursuant to North Carolina General Statutes § 44A-12 (1989), and actions to enforce the lien are instituted pursuant to North Carolina General Statutes § 44A-13.

Defendant timely filed a claim of lien pursuant to North Carolina General Statutes §§ 44A-8 and ...