Pierson v. Sewell

Decision Date08 August 1975
Docket NumberNo. 11431,11431
Citation539 P.2d 590,97 Idaho 38
PartiesJohn A. PIERSON, d/b/a Pierson Heating, Plaintiff-Respondent, v. Max F. SEWELL and Marian Sewell, husband and wife, Defendants-Appellants.
CourtIdaho Supreme Court

Lloyd J. Walker, Walker & Kennedy, Twin Falls, for defendants-appellants.

James T. Jones, Jerome, for plaintiff-respondent.

McQUADE, Chief Justice.

This is an action to foreclose a mechanic's lien. We affirm the judgment of the trial court insofar as it ordered the lien foreclosed. We find that the lien was timely filed and that the lien waiver signed by respondent was of no force or effect. However, we reverse the award of a deficiency judgment against appellants in the event that the proceeds of the foreclosure sale fail to satisfy respondent's claim, and also reverse that portion of the decree granting respondent a personal judgment against appellants for the amount due for materials and labor supplied.

Appellants are the owners of real property in Blaine County. Respondent, working as a subcontractor, furnished labor and materials beginning in October 1971, in connection with the installation of a heating system in a dwelling being constructed on appellants' property. The trial court found this work was done on a time and materials basis, computed by the lineal foot as the heating ducts were installed, this being customary in the trade.

During the construction of the dwelling, the general contractor, Butler Brothers, experienced financial difficulties. Subsequently, appellant Max Sewell had further progress payments to the general contractor withheld. In January 1972, Max Sewell requested from the various subcontractors, including respondent, lien waivers so that the lending institution would release the necessary funds. Each subcontractor executed a lien waiver. Respondent gave his lien waiver to appellant on January 13, 1972. The lending institution then disbursed the proceeds of the construction loan to the various subcontractors working on the dwelling with the exception of respondent. All the subcontractors were paid in full with the exception of respondent, who received nothing from the funds released by the lending institution. Respondent filed a notice of lien on March 9, 1972.

Several days after filing his notice of claim, respondent brought this cause of action to foreclose the lien. The trial court found that upon appellants' discovery of the prime contractor's financial difficulties, appellant Max Sewell assumed Butler Brothers' obligations arising from the construction of the dwelling. The trial court found that Sewell requested a lien waiver from respondent, the consideration for which was to be payment in full. The trial court also found that the notice of claim of lien was filed in accord with statute and that it had not been cancelled or otherwise discharged and that $2,195.85 was due respondent for the work performed and the materials furnished. The trial court ordered the lien foreclosed to satisfy respondent's claim, his attorney's fees in the sum of $750.00 plus costs in the amount of $203.15. The court held appellants liable for any deficiency if the proceeds of the foreclosure sale were insufficient to cover the amount due, plus attorney's fees and costs. The trial court also allowed recovery of a personal judgment against appellants for the total amount awarded.

Appellant urged eleven assignments of error which can be summarized into three main issues:

(1) Did respondent file a valid and timely notice of claim of lien as a prerequisite for instituting this action;

(2) Did respondent waive his right to a claim of lien by execution of the lien waiver on January 13, 1972; and

(3) Are appellants subject to a personal judgment for the amount awarded?

Many of appellants' assignments of error deal with factual findings made by the trial court. We re-affirm the rule many times stated, that the credibility of, and weight given to, the evidence presented at trial is exclusively the province of the trial judge when the court acts as finder of fact. Ivie v. Peck. 1 It follows that findings of fact supported by substantial, competent, although conflicting, evidence will not be disturbed on appeal. Id. 2

Mechanic's and other related liens are creatures of statute, and statutory requirements must be substantially complied with in order to perfect a valid lien. Boone v. P. & B. Logging Company. 3 Yet, these lien statutes are to be liberally construed: 'The provisions of our mechanics' and laborers' lien law, as well as all other lien statutes, must be liberally construed with a view to effect their objects and promote justice.' Seafoam Mines Corp. v. Vaughn. 4 The purpose of these statutes is to compensate persons who perform labor upon or furnish material to be used in the construction, alteration or repair of a building or structure. Boise Payette Lumber Co. v. Weaver. 5

The evidence shows that respondent subcontractor contracted with the prime contractor, Butler Brothers, to install a heating system in the construction of appellants' dwelling. As such, Pierson supplied materials and labor through his employees and, therefore, has by I.C. § 45-501 a right to a lien on the dwelling. To perfect that lien, a subcontractor, such as respondent, must file a notice of claim of lien within sixty days following the subcontractor's cessation of labor or furnishing of materials. I.C. § 45-507.

Appellants first argue that the trial court erred in finding that respondent furnished labor and materials on January 14, 1972, in order to complete his subcontract in connection with the construction of appellants' dwelling. They claim respondent's employees completed their work on the dwelling in December 1971, and therefore, the lien was not timely filed. Upon examination of the record we find ample, competent, although conflicting evidence to support the trial court's finding that respondent performed labor and supplied materials on January 14, 1972.

Assuming arguendo that respondent's employees did furnish labor and materials on January 14, 1972, appellants argue that work was of a trivial nature not extending the time for the running of the lien. They argue that construction of the dwelling, including the heating system, was substantially completed in December, with the sixty-day period for filing a notice of claim running from that time. Thus, the March 9, 1972, filing would be untimely.

We re-affirm the principle followed in Mitchell v. Flandro 6 that the sixty-day period for the filing of liens cannot be extended or revived by the furnishing of trivial labor or materials once the contract has been completed.

'Ordinarily, furnishing an article or performing a service trivial in character is not sufficient to extend the time for claiming a lien or to revive an expired lien, where the article is furnished or the service rendered after a substantial completion of the contract, and the article is not expressly required by the terms thereof.' 7

When additional material or labor is relied upon to extend the time for filing of the claim, the lien claimant must show that the materials or labor were actually used in constructing or repairing the structure, and that they were reasonably necessary to complete construction according to the terms of the contract. 8

Evidence was presented to the effect that one of respondent's employees spent a 'good half day' installing registers, changing two air ducts and replacing the thermostat. Respondent testified that this so-called 'finishing' work was considered the final work under the contract and is customarily done in the trade. The trial court's finding that the work of January 14, 1972, was done as part of the contract and therefore that the lien of March 9, 1972, was timely filed is supported by the record.

Appellants next argue that the trial court erred in failing to find that the lien waiver executed on January 13, 1972, waived respondent's lien rights. The trial court found that appellant Max Sewell personally asked the respondent for a lien waiver with the understanding that the waiver was necessary so that the money from the construction loan would be released by the lending institution in order to pay respondent.

Pierson testified that prior to the execution of the waiver, Max Sewell, directly or by inference, guaranteed that if Pierson completed his subcontract he would be compensated. Max Sewell denied this. He testified that he realized that the funds from the construction loan would not be sufficient to pay all the subcontractors; but upon his understanding that Butler would arrange to compensate Pierson, he secured lien waivers from all of the subcontractors so that the lending institution would disburse the proceeds from the construction loan to pay all the subcontractors with the exception of Pierson. Whatever may have been Pierson's motivation for executing the lien waiver, i. e., receipt of payment upon disbursement of the loan monies by the lending institution, evidence is lacking to indicate that the parties expressly agreed that payment would be forthcoming to Pierson from Sewell based upon his execution of the waiver. Taken at face value, the testimony of both parties indicates that they had different intentions at the time of execution of the lien waiver, intentions never expressed, as to the purpose and effect of that waiver. Clearly, there was no meeting of the minds. The minds of the parties must meet on all terms before a contract is formed. 9

The general rule is that an express waiver of a mechanic's lien must be supported by consideration in order to be effective and binding. McCorkle v. Lawson & Co., Inc. 10 Accepting the trial court's characterization, the instant consideration would be promise of payment in full. Where such consideration fails, the lien waiver is of no effect. 10 Thompson on Real Property (1957) states: 'The right to a lien is not waived by an agreement of waiver executed...

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