Rowen & Blair Elec. Co. v. Flushing Operating Corp.

• Decision Date: 29 August 1973
• Docket Number: No. 3,Docket No. 14751,3
• Citation: 211 N.W.2d 527,49 Mich.App. 89
• Parties: ROWEN AND BLAIR ELECTRIC CO., a Michigan corporation, Plaintiff-Appellant, v. FLUSHING OPERATING CORP., a New York corporation, et al., Defendants- Appellees
• Court: Court of Appeal of Michigan — District of US

Page 527

211 N.W.2d 527

49 Mich.App. 89

ROWEN AND BLAIR ELECTRIC CO., a Michigan corporation Plaintiff-Appellant, v. FLUSHING OPERATING CORP., a New York corporation, et al Defendants- Appellees.

Docket No. 14751.

Court of Appeals of Michigan, Division No. 3.

Aug. 29, 1973.

Released for Publication Oct. 31, 1973.

Nicholas J. Schaberg, Schaberg & Schaberg, Kalamazoo, for plaintiff-appellant.

Thomas M. Powers, Kalamazoo, for Flushing Operating Corp.

Quinn E. Benson, Kalamazoo, for Dutch Treat Bakers.

Charles J. Daudert, Kalamazoo, for Sparrow Building, Inc.

Before HOLBROOK, P.J., and T. M. BURNS and CHURCHILL*, JJ.

T. M. BURNS, Judge.

Plaintiff appeals from the entry of a summary judgment dismissing its suit against the defendants on the grounds that there were 'no facts stated in any of the sworn complaints, affidavits, or admissions of the plaintiff' to support its claim. GCR 1963, 117.2(3).

On or about July 1, 1969, and pursuant to an oral contract between the plaintiff and Dutch Treat Bakers, Inc., (hereinafter known as Dutch Treat), plaintiff began to furnish labor and materials in connection with the installation of electrical work for the improvement of the building occupied by Dutch Treat. The building was formally leased to Dutch Treat by the defendant Flushing Operating Corporation (hereinafter referred to as Flushing), on July 2, 1969. However records in the register of deeds office disclose that Flushing did not obtain title to the building until October of 1969. In any event, plaintiff continued to perform the work; and in November of 1969, Flushing paid the plaintiff the sum of $7,040.35 by a check made payable to both the plaintiff and Dutch Treat. The check was subsequently endorsed by Dutch Treat, and plaintiff was paid. Plaintiff completed the electrical work on May 13, 1970, and shortly thereafter timely filed the requisite statement with the register of deeds to establish a mechanic's lien against property occupied by Dutch Treat. See M.C.L.A. § 570.5; M.S.A. § 26.285. The amount claimed by the plaintiff totalled $39,033.50. This sum represented the unpaid balance for the work performed. On May 3, 1971, plaintiff instituted the present suit to foreclose the lien. Flushing moved for an accelerated judgment, which was treated by the trial court as a motion for summary judgment, alleging that it was entitled to a judgment as a matter of law since plaintiff had not complied with the notice provisions of the mechanic's lien statute M.C.L.A. § 570.6; M.S.A. § 26.286 which reads:

'Every person recording such statement or account as provided in the preceding section (M.C.L.A. 570.5; M.S.A. 26.285) except those persons contracting or dealing directly with the owner, part owner or lessee of such premises, shall within 10 days after the recording thereof, serve on the owner, part owner or lessee of such premises * * * a copy of such statement or claim * * *.'

Plaintiff admitted it had not served a copy of the statement on Flushing, but asserted that it had dealt directly with Flushing and was, therefore, per the terms of the statute excused from serving a copy of the statement on Flushing. After hearing the arguments of both parties and examining the record, the trial court concluded that there were sufficient allegations within plaintiff's complaint which if true indicated there were direct dealings between the plaintiff and Flushing. Accordingly, Flushing's motion for a summary judgment was denied. However, at the behest of Flushing a rehearing on the matter was granted. At the conclusion of the second hearing, the trial court found that plaintiff had failed to produce any evidentiary proof to support its claim it had direct dealings with Flushing. Consequently, Flushing's motion for a summary judgment was granted.

The entry of a summary judgment is never proper where there is a material issue of fact. GCR 1963, 117.2(3); Rogowski v. Detroit, 374 Mich. 408, 132 N.W.2d 16 (1965). Moreover in the recent case of Rizzo v. Kretschmer, 389 Mich. 363, 372, 207 N.W.2d 316, 320 (1973), the Supreme Court noted that where, as here, it is alleged via a motion for summary judgment that a plaintiff's claim lacks factual support:

'The courts are liberal in finding that a 'genuine issue' does indeed exist. As Honigman & Hawkins correctly comments, (1) the court will 'give the benefit of any reasonable doubt to the opposing party's and (2) 'the court must be satisfied that it is impossible for the claim or defense to be supported at trial Because of some deficiency which cannot be overcome."

Inasmuch as plaintiff has admitted it did not serve a copy of the lien statement upon Flushing and since M.C.L.A. § 570.6; M.S.A. § 26.286 provides an exception to the notice requirement where there has been direct dealing or contracting with the owner, part owner, or lessee of the premises sought to be encumbered by the mechanic's lien, it is patent that the outcome of plaintiff's suit depends upon whether there was any direct dealing or contracting between the plaintiff and Flushing.

The relevant portions of the complaint and amended complaint pertaining to direct dealing between the plaintiff and Flushing reads: ¹

'Paragraph 3. That on or about the first day of July, 1969, defendant, Dutch Treat Bakers, Inc., was the owner, part owner, or lessee and in possession of certain land and building * * * involved in this lawsuit. That on or about said date, to the best of plaintiff's information and belief, Flushing Operating Corporation held an undisclosed interest in said premises, which was not of record and which was unknown to the plaintiff at the time * * *. That on or about said date, pursuant to an oral agreement between plaintiff and defendant, Dutch Treat Bakers, Inc., plaintiff began the furnishing of labor and materials in connection with electrical work for the improvement of the building or buildings on said premises and the fixtures therein, and that said work was paid for in part by said Dutch Treat Bakers, Inc. That, according to the records of the register of deeds office, on or about October 26, 1969, Flushing Operating Corporation acquired to the said premises. That thereafter defendant, Flushing Operating Corporation, made at least one payment to plaintiff for work done on said premises, which said payment was in the sum of $7,040.35 and was in the form of a check drawn by said Flushing Operating Corporation, dated November 17, 1969, and payable to Rowen & Blair Electric Company (plaintiff) and Dutch Treat Bakers, Inc. * * *.'

'(Paragraph) 4. That thereafter and pursuant to said agreement, and at the request of defendants and with the full knowledge and acquiescence of defendant, Flushing Operating Corporation, either directly or indirectly through the relationship between the defendants, the plaintiff continued said work and the furnishing of materials until said work was completed on or about the 13th day of May, 1970 * * *.'

Flushing in its answer admitted drawing the check payable to both plaintiff and Dutch Treat, but denied the allegation in paragraph 4 as being untrue.

In view of the foregoing, it is readily apparent that the complaint and answer framed and raised the crucial question of fact as to whether there was a contract or direct dealing between the plaintiff and Flushing. Were Flushing's motion for a summary judgment...