Missouri Land Dev. Spec. v. Concord Exca.

• Decision Date: 07 October 2008
• Docket Number: No. ED 89112.,No. ED 89116.,ED 89112.,ED 89116.
• Citation: 269 S.W.3d 489
• Parties: MISSOURI LAND DEVELOPMENT SPECIALTIES, LLC, a Limited Liability Company, Respondent/Cross-Appellant, v. CONCORD EXCAVATING COMPANY, L.L.C., et al., Defendants, Thomas Cummings, Trustee, and First Service Bank, Appellants/Cross-Respondents.
• Court: Missouri Court of Appeals

269 S.W.3d 489

MISSOURI LAND DEVELOPMENT SPECIALTIES, LLC, a Limited Liability Company, Respondent/Cross-Appellant, v. CONCORD EXCAVATING COMPANY, L.L.C., et al., Defendants Thomas Cummings, Trustee, and First Service Bank, Appellants/Cross-Respondents.

No. ED 89112.

No. ED 89116.

Missouri Court of Appeals, Eastern District, Division Two.

October 7, 2008.

Motion for Rehearing and/or Transfer to Supreme Court Denied November 13, 2008.

Application for Transfer Denied December 16, 2008.

John N. Borbonus, St. Louis, MO, for appellants.

Garry K. Seltzer, Diane M. Gray, Clayton, MO, for respondent.

LAWRENCE E. MOONEY, Presiding Judge.

In this mechanic's lien action, the parties appeal from the trial court's judgment entered in favor of the lien claimant. The trial court awarded the claimant a mechanic's lien, but awarded a lien amount that was less than requested. The excluded amount, found nonlienable by the trial court, represents charges for grading and excavating equipment while such equipment sat idle due to a shut-down caused by nonpayment by the general contractor. In addition to the mechanic's lien, the trial court also awarded the claimant interest on the lien amount. The bank, which holds an interest in the land that is inferior to claimant's, appeals. The lien claimant cross-appeals. The parties present a number of issues for our determination, including a matter of first impression. To guide the reader, we set out the parties' challenges in some detail, here at the outset.

The appellant bank alleges error in both the trial court's award of a mechanic's lien and its award of interest. As to the trial court's award of a mechanic's lien, the bank raises two general, multi-faceted, challenges. First, the bank contends the trial court erred in not vitiating the claimant's lien in its entirety. It maintains that the lien claim is not a "just and true account," as required by Missouri's mechanic's lien statute, because the claimant could not provide a consistent, total principal amount of the lien and because the claimant included nonlienable items in its claim. Second, the bank alternatively argues that if the claim is not entirely disallowed, then the principal amount of the lien should be reduced. It argues for both a lower starting-point for the calculations of the principal lien amount as well as an increased value of the excluded "downtime" charges. As to the trial court's award of interest, the bank first contends that trial court erred in awarding any prejudgment interest because the lien claim was unliquidated. Secondly, the bank alternatively argues that even if an award of interest is proper, the trial court nevertheless chose an incorrect date from which to calculate the interest due.

The lien claimant cross-appeals, challenging the trial court's exclusion of the "downtime" charges as part of the awarded lien. The claimant argues that the charges are lienable through retroactive application of the amended mechanic's lien statute. The claimant also contends that the charges are lienable as "labor," and urges us to hold, as an issue of first impression, that charges for equipment during periods of nonuse are lienable under Missouri law as labor costs.

We reject each and every contention raised by the parties and affirm the trial court's judgment.

Factual and Procedural Background

Missouri Land Development Specialties, LLC, the lien claimant in this case, is an excavating and blasting company. The company was retained in August of 2004, on a time-and-material basis, to render grading, excavating and other land-related construction services on a certain tract of land being developed as the Woods Mill Subdivision in St. Charles County. The tract of land was owned at that time by Woods Mill Development Company, LLC, which retained Concord Excavating Company, LLC, as the general contractor on the project. Concord Excavating, in turn, with the knowledge and consent of the landowner, retained the lien claimant as a subcontractor on the project. The lien claimant worked on the Woods Mill Subdivision project from mid-August 2004 until October 22, 2004. It then shut down work on the project due to nonpayment by the general contractor, but kept its equipment onsite for a period of time. No operators were present on the jobsite during this shutdown time. The lien claimant eventually moved the equipment off the jobsite, doing no further work on the property after the shutdown.

The lien claimant filed its mechanic's lien claim on January 5, 2005, approximately one month after serving the landowner with a ten-day notice of intent to lien. On the face of the lien claim, the claimant stated that it was filing the attached account "for work and labor done and material furnished" by the claimant under contract with the general contractor, "upon, to and for the buildings and improvements" at the Woods Mill Subdivision. The lien claimant attached the contract and a number of unpaid invoices with supporting documentation to its lien claim. The claimant listed the principal amount due as $628,595.43.

Over one month later, on February 14, 2005, the lien claimant filed its petition to enforce its mechanic's lien claim. The claimant named the landowner and the general contractor as defendants. The claimant also named FirstService Bank, cestui que trust, and Thomas Cummings, trustee, as defendants having an interest in the real estate at issue. FirstService Bank was the lender for the project. FirstService Bank, cestui qui trust, and Thomas Cummings, trustee (hereinafter collectively referred to as FirstService Bank or bank) held a Construction Deed of Trust and a Modification of Deed of Trust on the parcel of land at issue. The claimant's petition included three counts related to the Woods Mill subdivision project: (1) a breach-of-contract action against the general contractor; (2) a mechanic's lien action; and (3) a quantum-meruit action against the landowner. As to the mechanic's lien action, the claimant alleged that the amount due for the labor and materials it furnished under contract with the general contractor for the project, after allowing all just credits and setoffs, was $628,595.43.

After a period of discovery, the parties proceeded to a bench trial. The lien claimant presented the live testimony of Clayton Francois, its president. The claimant also introduced the lien claim with all the attached invoices and supporting documentation. FirstService Bank presented neither live witnesses nor deposition testimony in its defense and introduced only one document into evidence—a one-page, undated and untitled document resembling a statement, which the lien claimant had produced in response to the bank's discovery request. The document lists a number of invoices, dated September through November of 2004, for blasting and excavating services. The document reflects partial payment of the invoices and then shows the grand total of the invoices to be $615,021.92.

Mr. Francois, for the lien claimant, began his testimony by explaining the type of work his company was hired to provide at the Woods Mill subdivision project under its contract with the general contractor. He then went through each of the invoices attached to the claimant's lien claim, explaining the charges, and confirming the unpaid amount due on each invoice. Of particular importance is an invoice dated November 20, 2004, on which the following notation appears at the top of the second page:

Losses due to shut down of job. Expenses remaining on standby per Eric due to payment not yet received.

The bottom of the second page of this invoice shows a subtotal due of $62,288.65. Mr. Francois stated that of all the listed invoice items, only the first four line-items on the second page were from the shutdown. These charges are ascribed to one dozer, two thirty-ton trucks, one excavator, and one 953 high lift. Mr. Francois testified that although this machinery was sitting idle on the jobsite, with no operators, the claimant was still paying rent on the machinery. Mr. Francois further testified that Eric Johnson, on behalf of the general contractor, had told him that the general contractor would pay the claimant's expenses, including the rent on the machines, while the claimant awaited payment. Mr. Francois also acknowledged that this equipment was later moved off the jobsite, doing no further work on the property after the shutdown. The charges for these particular pieces of equipment total $50,538.65.

As to the total amount of the lien claimant's claim, Mr. Francois initially testified that the claimant was requesting a mechanic's lien on the Woods Mill subdivision in the principal amount of $627,987.92, the same amount reflected on a trial exhibit prepared by counsel for the lien claimant. Later during trial, the parties recalculated the various invoices included in the lien claim, and agreed that the sum of the unpaid invoices was $624,987.92.

The trial court entered judgment in favor of the lien claimant. The trial court first entered a money judgment against the general contractor for $953,106.58, representing the balance due on the lien claimant's unpaid invoices, plus interest and attorney's fees. Secondly, the trial court awarded the lien claimant a mechanic's lien on the real estate at issue. The trial court found that the charges listed on the unpaid invoices attached to the claimant's lien claim were all reasonable, except for $50,538.65 which the court found was not lienable. Consequently, the trial court awarded a mechanic's lien, in accordance with the unpaid invoices, in the lesser principal sum of $574,449.27, not $624,987.92 as requested. The excluded amount of $50,538.65 equals the total of charges for the above-described pieces of equipment during "downtime"—the period during which the equipment sat idle and shut down because of nonpayment by the general contractor. Lastly, the trial court awarded the lien claimant interest ...