Osgood v. Kent

Decision Date21 December 2011
Docket NumberCivil No. 11-cv-477-SM
PartiesJeffrey Osgood d/b/a JP's Concrete v. George and Evelyn Kent
CourtU.S. District Court — District of New Hampshire
ORDER

In a case that has been removed from the Grafton County Superior Court, Jeffrey Osgood has sued George and Evelyn Kent, asserting claims for breach of contract and quantum meruit. Osgood seeks to recover money he claims to be owed for demolition and construction work he performed for the Kents under a contract the Kents terminated before the completion of the work for which they hired him. When Osgood filed his complaint in state court, he also filed a petition/motion for ex-parte attachment, to perfect a mechanics's lien. The Superior Court granted the motion and awarded Osgood an attachment in the amount of $35,750. After the case was removed, the Kents objected to the attachment and requested a hearing, which was conducted on November 30, 2011. For the following reasons, $23,750 of the attachment ordered by theSuperior Court is discharged, but an attachment in the amount of $12,000 remians in force.

Background

The following narrative is drawn from the materials submitted by the parties and evidence presented at the hearing. The Kents contracted with Osgood to perform three kinds of work at Ogontz Hall, a building they own in Lyman, New Hampshire. Specifically, they engaged Osgood to shore the building, undertake selective demolition, and erect cast-in-place concrete footings and walls. Osgood poured concrete on December 17, but the Kents were not satisfied with the quality of the concrete he used. The Kents' architect and structural engineer concluded that Osgood's work needed to be redone. Osgood disagreed, and never returned to continue work on the construction site.

By letter dated May 6, 2011, the Kents terminated their contract with Osgood. Their letter stated, in pertinent part:

Notice is given that you are not to enter the premises of Ogontz Camp for any reason without the express permission of the owners or their representatives. . . .
You are not to disassemble or move any of your cribbing and support beams that are shoring the building. They are to remain in place until the walls poured on December 17 are replaced and the building is able to sit on their replacements, or until alternative arrangements are able to be made to shore the building. At that time either the cribbing and beams will be removed and made available to you topick up, or you will be contacted to disassemble and remove them yourself.

Pl.'s Ex. 5, at 4.

The Kents have never notified Osgood that his cribbing and beams are available to be picked up, nor have they contacted him to remove those items. On August 30, 2011, Osgood sent the Kents a bill for $35,750, seeking payment for the following items, characterized as extra work above the contract agreement: (1) cutting a concrete floor; (2) recribbing all of the north wall twice; (3) demential demolition of the north end of the west wall; (4) removing the superior wall system at the car port and replacing it with CIP (cast in place) concrete; (5) removing the superior wall at the east side of the elevator pit and cribbing; (6) winter heat in wall mix; (7) machine time to build road for concrete truck and to plow snow; (8) plate compactor rental; and (9) I-Beam and cribbing rental from May 6, 2011 to September 6, 2011. See Pl.'s Ex. 6. At the hearing, Osgood testified that while none of the "extra work" described above was performed under a written change order, he received oral permission from the Kents' representative to perform some of that work, and the remainder of it was so obviously necessary that the Kents' representative would have been aware of the need for it. The attachment ordered by the Superior Court is for $35,750, the full amount of Osgood's August 30 bill.

Discussion

The Kents argue that the court should discharge the attachment because: (1) Osgood is not entitled to a mechanic's lien based on work he performed outside the contract, for which he seeks to recover under quantum meruit; (2) Osgood failed to perfect his lien within the 120 days required by N.H. Rev. Stat. Ann. ("RSA") 447:9; (3) Osgood is not entitled to a mechanic's lien for the use of his equipment after the termination of his contract; and (4) Osgood has not been vigilant in protecting his rights. Osgood disagrees, categorically. The court begins by outlining the relevant law and then turns to each of the Kents' four arguments.

A. The Law of Mechanic's Liens

In federal court, "[p]re-judgment attachments are available to secure satisfaction of judgments 'under the circumstances and in the manner provided by the law of the state where the district court is held.'" H.E. Contr. v. Franklin Pierce Coll., 360 F. Supp. 2d 289, 290 (D.N.H. 2005) (quoting Fed. R. Civ. P. 64).

Under New Hampshire law, a mechanic's lien is a statutory right that arises automatically upon the provision of labor or materials. See N.H. Rev. Stat. Ann. ("RSA") Chapter 447:2. The lien provides security against the property owner for the value of the labor or materials rendered. Pine Gravel, Inc. v. Cianchette, 128 N.H. 460 (1986).

H.E. Contr., 360 F. Supp. 2d at 290-91. (footnote and parallel citations omitted). The New Hampshire Supreme Court has recently described the mechanics of the mechanic's-lien statute:

Under RSA 447:2, a person who performs labor or furnishes material, "to the amount of $15 or more," for building or repairing a house, has "a lien on any material so furnished and on said structure, and on any right of the owner to the lot of land on which it stands." RSA 447:2 (2002). The lien continues for 120 days after the services are provided or the materials are furnished, RSA 447:9 (2002), and may be secured in accordance with RSA 447:10, which provides: "Any such lien may be secured by attachment of the property upon which it exists at any time while the lien continues, the writ and return thereon distinctly expressing that purpose." RSA 447:10.

Alex Builders & Sons, Inc. v. Danley, 161 N.H. 19, 22-23 (2010). Regarding the application of those statutes, "[f]ailure to comply with the specific statutory provisions of perfecting a mechanics lien is usually fatal." Alex Builders, 161 N.H. at 23 (quoting Rodd v. Titus Constr. Co., 107 N.H. 264, 266 (1966); citing Gen. Insul. Co. v. Eckman Constr., 159 N.H. 601, 609 (2010)). This is because "[t]he remedy of attachment is in derogation of the common law." Alex Builders, 161 N.H. at 23 (quoting Maine Nat'l Bank v. Baker, 116 N.H. 185, 186 (1976)). On the other hand, however, "strict compliance with a statute does not equate to strict construction of its terms." Alex Builders, 161 N.H. at 24 (quoting Impact Food Sales, Inc. v. Evans, 160 N.H. 386, 399 (2010) (Hicks, J., dissenting)).

This is especially true where "[t]he purpose of the mechanics' lien law is remedial, to guarantee effective security to those who furnish labor or materials which are used to enhance the value of the property of others." Innie v. W & R, Inc., 116 N.H. 315, 317 (1976). The general rule is to construe remedial statutes liberally in favor of the person the statute is intended to benefit. See, e.g., Stankiewicz v. City of Manchester, 156 N.H. 587, 594 (2007).

Alex Builders, 161 N.H. at 24 (parallel citations omitted).

After an attachment is made to secure a mechanic's lien, the party against whom the attachment has been made is entitled to a prompt hearing. See RSA 511-A:8. The scope of such a hearing is limited:

[T]he content and focus of a post-attachment hearing on a mechanic's lien is whether the plaintiff has met its burden under RSA 511-A:8, which defendant may rebut. [Consol. Elec. Distrib., Inc. v. SEC Concord Co., No. 89-C-171/179 (Merrimack Cty. Super. Ct. Nov. 21, 1989).] The defendant may challenge the plaintiff's basic right to recovery under RSA 447, the lien amount, or notice provisions. Id.; see also West Side Dev. Group, LLC v. D'Amour, No. 04-C-018, (Carroll County Superior Ct., March 24, 2004) . . . (finding that the provisions of RSA 511-A:3 specifying the "reasonable likelihood of success test" and the "sufficiency of assets test" do not apply to a mechanic's lien proceeding under RSA 477).

H.E. Contr., 360 F. Supp. 2d at 291.

B. Work Outside the Contract

The Kents' first argument is that because the work giving rise to Osgood's lien is described by Osgood himself as "Extra Work Above Contract Agreement," Pl.'s Ex. 6, that worknecessarily falls outside the ambit of the mechanic's-lien statute, which is limited to work "for erecting a house or other building . . . by virtue of a contract with the owner thereof." RSA 447:2. The problem with the Kents' argument is that it conflates compliance with the statutory provisions for perfecting a mechanic's lien, which must be strictly enforced, see Alex Builders, 161 N.H. at 23, with statutory construction which should be liberal, see id. at 24. Here, the question is whether the work for which Osgood received an attachment was undertaken "by virtue of a contract" with the Kents. Construing that phrase liberally, as the court must, Osgood's extra work was undertaken by virtue of his contract with the Kents; it is only by direct reference to that contract that Osgood's work was "extra." Moreover, it cannot seriously be argued that Osgood would have undertaken his "extra" work if not for the work under the contract that preceded it. Finally, the court notes that in Alex Builders, in which the New Hampshire Supreme Court reversed the trial court's discharge of the plaintiff's mechanic's lien, "the plaintiff sued the defendants under theories of breach of contract, quantum meruit and unjust enrichment." Id. at 21. In short, the Kents' first argument is without merit.

C. Failure to Timely Perfect

The Kents' principal argument is that Osgood failed to perfect his mechanic's lien in a timely manner. While they do not say when the 120-day period for perfecting the lien created by RSA 447:9 b...

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