Pearson v. Lamb, 20040613-CA.

• Decision Date: 19 October 2005
• Docket Number: No. 20040613-CA.,20040613-CA.
• Citation: 121 P.3d 717,2005 UT App 383
• Parties: Robert PEARSON dba Robert Pearson Construction, Plaintiff and Appellee, v. Suzanne J. LAMB, Defendant and Appellant.
• Court: Utah Supreme Court

Page 717

121 P.3d 717

2005 UT App 383

Robert PEARSON dba Robert Pearson Construction, Plaintiff and Appellee, v. Suzanne J. LAMB, Defendant and Appellant.

No. 20040613-CA.

Court of Appeals of Utah.

September 9, 2005.

Rehearing Denied October 19, 2005.

David B. Thompson, Miller Vance & Thompson PC, Park City, for Appellant.

David M. Bennion and Michael P. Petrogeorge, Parsons Behle & Latimer, Salt Lake City, for Appellee.

Before Judges DAVIS, ORME, and THORNE.

OPINION (For Official Publication)

DAVIS, Judge:

¶ 1 Suzanne J. Lamb (Defendant) appeals the trial court's denial of her motion for a new trial, in which she argued that the failure of Robert Pearson (Plaintiff) to comply with Utah Code section 38-1-11(4)(a) divested the trial court of jurisdiction. See Utah Code Ann. § 38-1-11(4)(a) (2001). We affirm.

BACKGROUND

¶ 2 In October 2002, Plaintiff filed a complaint seeking foreclosure of a mechanics' lien. Defendant filed her answer in December 2002 and an amended answer and counterclaim in February 2003; neither pleading contained allegations that Plaintiff failed to comply with the requirements of the Mechanics' Liens Act. On April 12, 2004, the parties filed stipulations of fact with the district court, stipulating that

Mr. Pearson has complied with all the statutory procedural requirements for perfecting and foreclosing on a mechanics' lien ...; Mrs. Lamb does not defend against Mr. Pearson's mechanics' lien claim on these statutory procedural grounds, but simply challenges his right to receive payment of the amounts claimed in the lien.

A bench trial was held thereafter, and the district court entered a memorandum decision in favor of Plaintiff on April 20, 2004.

¶ 3 On May 26, 2004, Defendant filed a motion for reconsideration (which she now dubs a motion for a new trial), in which she argued that the trial court lacked jurisdiction to hear the foreclosure action because Plaintiff failed to comply with the requirements of section 38-1-11(4)(a) of the Mechanics' Liens Act. The trial court, on June 16, 2004, issued a ruling and order denying Defendant's motion for a new trial, and on July 28, 2004, entered a Final Order and Judgment in favor of Plaintiff.

ISSUE AND STANDARD OF REVIEW

¶ 4 The only issue before this court is whether Plaintiff's failure to comply with section 38-1-11(4)(a) of the Mechanics' Liens Act divested the trial court of jurisdiction to hear Plaintiff's mechanics' lien foreclosure action. If Plaintiff's failure to comply with section 38-1-11(4)(a) did not divest the trial court of jurisdiction, it is undisputed that Defendant waived that issue, not only by failing to assert it prior to trial but also by stipulation.

¶ 5 The determination of whether a court has subject matter jurisdiction is a question of law, which we review for correctness, according no deference to the trial court's determination. See Beaver County v. Qwest, Inc., 2001 UT 81,¶ 8, 31 P.3d 1147. Questions of statutory interpretation are similarly questions of law that are reviewed "for correctness, giving no deference to the district court's interpretation." Board of Educ. v. Sandy City Corp., 2004 UT 37,¶ 8, 94 P.3d 234.

ANALYSIS

¶ 6 Under section 38-1-11(4)(a) of the Mechanics' Liens Act, lien claimants filing an action to enforce a lien must serve on the defendant-owner of a residence instructions relating to the owner's rights and a form affidavit along with the complaint. See Utah Code Ann. § 38-1-11(4)(a) (2001). Pursuant to section 38-1-11(4)(e), "[i]f a lien claimant fails to provide to the owner of the residence the instructions and form affidavit required by [s]ubsection 4(a), the lien claimant shall be barred from maintaining or enforcing the lien upon the residence." Id. § 38-1-11(4)(e). On appeal, Defendant argues that the language of section 38-1-11(4)(e) makes subsection 4(a) "mandatory," thereby making it a jurisdictional provision that cannot be waived and can be raised at any time. Defendant thus contends that Plaintiff's failure to comply with requirements of section 38-1-11(4)(a) deprived the trial court of jurisdiction to hear Plaintiff's lien foreclosure action.

¶ 7 Whether a procedure prescribed by statute is jurisdictional depends on whether the procedure is "mandatory" or "directory." Beaver County v. Utah State Tax Comm'n, 919 P.2d 547, 552 (Utah 1996). And while a procedure is generally considered "mandatory" when "consequences are attached to the failure to act," Stahl v. Utah Transit Auth., 618 P.2d 480, 481 (Utah 1980), the purpose of the statute and the legislature's intent are of the utmost importance:

There is no universal rule by which directory provisions may, under all circumstances, be distinguished from those which are mandatory. The intention of the legislature, however, should be controlling and no formalistic rule of grammar or word form should stand in the way of carrying out the legislative intent.... The statute should be construed according to its subject matter and the purpose for which it was enacted.

Kennecott Copper Corp. v. Salt Lake County, 575 P.2d 705, 706 (Utah 1978) (alterations in original) (quotations and citation omitted); see also Stahl, 618 P.2d at 482 ("A statute is, of course, to be construed in light of its intended purposes."). Therefore, "[a] designation is mandatory, and therefore jurisdictional, if it is `of the essence of the thing to be done.'" Beaver County v. Utah State Tax Comm'n, 919 P.2d at 552 (quoting Kennecott Copper Corp., 575 P.2d at 706) (other quotations and citations omitted); see also Projects Unlimited, Inc. v. Copper State Thrift & Loan Co., 798 P.2d 738, 744 (Utah 1990) ("We must determine whether the rigorous interpretations urged by [defendants] are necessary to protect the interests of the parties in the instant situation. Unless we find that [Plaintiff's] alleged failures have compromised a purpose of the mechanic[s'] lien statute, those failures will be viewed as technical....").

¶ 8 The Mechanics' Liens Act was passed primarily to protect laborers who have added value to the property of another, but also to protect the property owner's right to convey clear title:

[T]he purpose of the mechanic[s'] lien act is remedial in nature and seeks to provide protection to laborers and materialmen who have added directly to the value of the property of another by their materials or labor. On the other hand, we recognize that liens create an encumbrance on property that deprives the owner of his ability to convey clear title and impairs his credit.... State legislatures and courts attempt to balance these competing interests through their mechanic[s'] lien statutes and judicial interpretations thereof.

Projects Unlimited, 798 P.2d at 743 (quotations and citations omitted); see also Mickelsen v. Craigco, Inc., 767 P.2d 561, 563 (Utah 1989) ("[T]he mechanic[s'] lien law was enacted for the benefit of those who perform the labor and supply the materials...."). We must therefore balance a laborer's right to be paid for his labor and materials with the negative impact that liens have on an owner's credit and her ability to convey clear title. Plaintiff's failure to serve Defendant with instructions and a form affidavit is irrelevant to the lien's negative impact, whereas invalidating Plaintiff's right to be paid for his labor simply because he made a procedural error clearly contravenes the intended purpose of the Mechanics' Liens Act. Quite simply, the requirements of section 38-1-11(4)(a) have nothing to do with "the essence of the thing to be done," Beaver County v. Utah State Tax Comm'n, 919 P.2d at 552 (quotations and citations omitted), and Plaintiff's failure to comply therewith did not compromise a purpose of the Act.

¶ 9 Furthermore, the procedures set forth in section 38-1-11(4)(a) are not "mandatory" because no consequences attach to the failure to act. See Stahl, 618 P.2d at 481. The omission could have been remedied at any time during the course of the proceedings, or, had the trial court dismissed Plaintiff's mechanics' lien foreclosure action for failure to adhere to section 38-1-11(4)(a), the dismissal could have been easily addressed by either refiling or, depending on the timing, through Utah's savings statute. See Utah Code Ann. § 78-12-40 (2002). Under Utah's savings statute,

[i]f any action is commenced within due time and a judgment thereon for the plaintiff is reversed, or if the plaintiff fails in such action or upon a cause of action otherwise than upon the merits, ... [the plaintiff] may commence a new action within one year after the reversal or failure.

Id.

¶ 10 Although Plaintiff may have failed to serve Defendant with the instructions and form affidavit required by section 38-1-11(4)(a), there is no question that he commenced his action within due time. "A civil action is commenced (1) by filing a complaint with the court, or (2) by service of a summons together with a copy of the complaint." Utah R. Civ. P. 3(a). And section 38-1-11(1) gives lien claimants twelve months after completion of the contract, or 180 days after the lien claimant last performed labor, to file suit. See Utah Code Ann. § 38-1-11(1). Here, Plaintiff performed labor at the residence throughout the spring of 2002 and filed his complaint seeking foreclosure in October 2002. Because Plaintiff's action was timely commenced and a dismissal for failure to adhere to section 38-1-11(4)(a) would have been a dismissal "otherwise than upon the merits," id. § 78-12-40, Plaintiff could have remedied his failure simply by commencing a new action within one year after the dismissal.

¶ 11 Unlike "mandatory" designations, "a designation is merely directory, and therefore not jurisdictional, if it is `given with a view merely to the proper, orderly and prompt conduct of the business, and by the failure to obey no prejudice will occur to those whose rights are protected by the statute.'" Beaver County v. Utah State Tax Comm'n, ...