Tilt-Up Concrete, Inc. v. Star City/Federal

• Decision Date: 19 January 2001
• Docket Number: No. S-99-799.,S-99-799.
• Citation: 261 Neb. 64,621 N.W.2d 502
• Court: Nebraska Supreme Court
• Parties: TILT-UP CONCRETE, INC., a Nebraska corporation, Appellant, v. STAR CITY/FEDERAL, INC., a South Dakota corporation, Appellee.

621 N.W.2d 502

261 Neb. 64

TILT-UP CONCRETE, INC., a Nebraska corporation, Appellant, v. STAR CITY/FEDERAL, INC., a South Dakota corporation, Appellee.

No. S-99-799.

Supreme Court of Nebraska.

January 19, 2001.

Edward H. Tricker, Kerry L. Kester, and Craig C. Dirrim, of Woods & Aitken, L.L.P., Lincoln, for appellant.

Robert T. Grimit and Timothy E. Clarke, of Baylor, Evnen, Curtiss, Grimit & Witt, Lincoln, for appellee.

HENDRY, C.J., and WRIGHT, CONNOLLY, GERRARD, STEPHAN, McCORMACK, and MILLER-LERMAN, JJ.

GERRARD, J.

FACTUAL AND PROCEDURAL BACKGROUND

In April 1994, Tilt-Up Concrete, Inc. (Tilt-Up), filed a petition in the district court against Star City/Federal, Inc. (Star City), seeking foreclosure of a construction lien. The facts of the underlying dispute are set out more fully in this court's decision in that matter. See Tilt-Up Concrete v. Star City/Federal, 255 Neb. 138, 582 N.W.2d 604 (1998) (Tilt-Up I). The district court in Tilt-Up I determined that Tilt-Up had a valid construction lien in the amount of $852,243.70 and entered judgment accordingly. On appeal, we held that when a prime contractor has not substantially performed a contract, the contractor is entitled to a construction lien only for the reasonable value of the labor performed and the materials furnished; consequently, this court reduced the amount of Tilt-Up's lien to $235,418. Id.

In October 1998, Tilt-Up filed another petition in the district court, seeking a deficiency judgment and damages for breach of an oral contract. Star City demurred on the ground that the action was barred by the 4-year statute of limitations for oral contracts. See Neb.Rev.Stat. § 25-206 (Reissue 1995). The district court sustained the demurrer, and Tilt-Up filed an amended petition. Star City again demurred, and the district court again sustained the demurrer. Tilt-Up elected to stand on its amended petition, the district court dismissed the action, and Tilt-Up appeals.

STANDARD OF REVIEW

In reviewing an order sustaining a demurrer, an appellate court accepts the truth of the facts which are well pled, together with the proper and reasonable inferences of law and fact which may be drawn therefrom, but does not accept the conclusions of the pleader. Freeman v. Hoffman-La Roche, Inc., 260 Neb. 552, 618 N.W.2d 827 (2000); Wilkinson v. Methodist, Richard Young Hosp., 259 Neb. 745, 612 N.W.2d 213 (2000).

In considering a demurrer, a court must assume that the facts pled, as distinguished from legal conclusions, are true as alleged and must give the pleading the benefit of any reasonable inference from the facts alleged, but cannot assume the existence of facts not alleged, make factual findings to aid the pleading, or consider evidence which might be adduced at trial. Doksansky v. Norwest Bank Neb., 260 Neb. 100, 615 N.W.2d 104 (2000); Armour v. L.H., 259 Neb. 138, 608 N.W.2d 599 (2000).

Statutory interpretation presents a question of law, in connection with which an appellate court has an obligation to reach an independent conclusion irrespective of the decision made by the court below. Hollandsworth v. Nebraska Partners, 260 Neb. 756, 619 N.W.2d 579 (2000); Gage Cty. Bd. v. Nebraska Tax Equal. & Rev. Comm., 260 Neb. 750, 619 N.W.2d 451 (2000).

ASSIGNMENTS OF ERROR

Tilt-Up assigns, as consolidated and restated, that the district court erred in determining that (1) Tilt-Up was not barred from bringing a breach of contract action by the supersedeas bond in Tilt-Up I, (2) Tilt-Up was not barred from bringing a breach of contract action by Neb.Rev.Stat. § 25-2140 (Reissue 1995), (3) Tilt-Up did not state a cause of action under Neb.Rev. Stat. § 52-157 (Reissue 1998), and (4) Tilt-Up's action was barred by the doctrine of election of remedies.

ANALYSIS

We initially note that Tilt-Up's appellate arguments are exclusively directed at its theory of recovery for breach of contract and do not address its claim for a deficiency judgment. The district court determined that Tilt-Up obtained only a construction lien in Tilt-Up I and did not obtain a judgment for the full amount of its contract damages. Tilt-Up's appellate assignments of error do not challenge this determination. Accordingly, Tilt-Up's deficiency judgment claim is not at issue. See, Nelson v. Lusterstone Surfacing Co., 258 Neb. 678, 605 N.W.2d 136 (2000); Schindler v. Walker, 256 Neb. 767, 592 N.W.2d 912 (1999) (error must be assigned and argued to be considered by appellate court).

Pursuant to § 25-206, Tilt-Up had 4 years from the breach of its contract with Star City to bring its action on the oral contract. Tilt-Up's amended petition alleges that its contract with Star City was breached on January 20, 1994. Tilt-Up's first petition for breach of contract was filed on October 16, 1998. Consequently, the bar of the statute of limitations is apparent on the face of the petition. A petition which makes apparent on its face that the cause of action it asserts is ostensibly barred by the statute of limitations fails to state a cause of action and is demurrable unless the petition alleges some excuse which tolls the operation and bar of the statute. Ohio Nat. Life Ins. Co. v. Rust, 255 Neb. 372, 585 N.W.2d 438 (1998); Vanice v. Oehm, 247 Neb. 298, 526 N.W.2d 648 (1995). Therefore, the primary question presented in this case is whether Tilt-Up's amended petition effectively alleges an excuse which tolls the operation and bar of the statute. See id.

The argument advanced by Tilt-Up is that the statute of limitations was equitably tolled during the pendency of its construction lien foreclosure action because Tilt-Up was barred during that time from bringing a breach of contract action. Tilt-up advances several theories as to why it was barred from bringing a breach of contract action. Assuming arguendo that the statute of limitations would have been tolled had Tilt-Up actually been barred from bringing its breach of contract action, we proceed to consider each of Tilt-Up's theories as to why its breach of contract action may have been precluded.

EFFECT OF NEBRASKA CONSTRUCTION LIEN ACT

Tilt-Up's construction lien was brought under the Nebraska Construction Lien Act (NCLA), Neb.Rev.Stat. §§ 52-125 through 52-159 (Reissue 1998). See Tilt-Up I. The first issue we address is whether the NCLA precludes a construction lienholder from also pursuing an action for breach of contract.

The general rule is long established that "in the absence of some provision to the contrary ... the remedy upon a mechanic's lien and the remedy upon the debt are distinct and concurrent, and may be pursued at the same time or in succession." Hatcher v. Hendrie & Bolthoff Mfg. & Supply Co., 133 F. 267, 271 (8th Cir. 1904). See, generally, 53 Am.Jur.2d Mechanics' Liens §§ 338 and 339 (1996). See, also, e.g., Great Western Sav. v. George W. Easley, 778 P.2d 569 (Alaska 1989); Pine Gravel, Inc. v. Cianchette d/b/a Site Prep., 128 N.H. 460, 514 A.2d 1282 (1986); Sentry Engineering v. Mariner's Cay Dev. Corp., 287 S.C. 346, 338 S.E.2d 631 (1985); Meier v. Novak, 338 N.W.2d 631 (N.D.1983); Lane-Tahoe, Inc. v. Kindred Constr. Co., 91 Nev. 385, 536 P.2d 491 (1975), disapproved on other grounds, County of Clark v. Blanchard Constr. Co., 98 Nev. 488, 653 P.2d 1217 (1982)

; McHugh Elec. Co. v. Hessler Rlty. & Dev. Co., 50 Del. 296, 129 A.2d 654 (1957); W. Va. Sanitary Engin. Corp. v. Kurish, 137 W.Va. 856, 74 S.E.2d 596 (1953); Roseliep v. Herro, 206 Wis. 256, 239 N.W. 413 (1931); Southern Sur. Co. v. York Tire Service, 209 Iowa 104, 227 N.W. 606 (1929); Alberti v. Moore et al., 20 Okla. 78, 93 P. 543 (1908); Groesbeck v. Linden, 321 N.J.Super. 349, 729 A.2d 47 (1999); Old Kent v. Whitaker Constr. Co., 222 Mich.App. 436, 566 N.W.2d 1 (1997),

appeal denied 457 Mich. 858, 581 N.W.2d 729 (1998); Brook-Hattan Utilities v. 893 Const., 180 A.D.2d 660, 579 N.Y.S.2d 705 (1992); Jaric, Inc. v. Chakroff, 63 Ohio App.3d 506, 579 N.E.2d 493 (1989); Kenko, Inc. v. Lowry Hill Const. Co., 392 N.W.2d 18 (Minn.App.1986); St. Regis Paper Co. v. Quality Pipeline, 469 So.2d 820 (Fla.App. 1985),

review denied 479 So.2d 118; Tighe v. Kenyon, 681 P.2d 547 (Colo.App.1984); Costanzo v. Stewart, 9 Ariz.App. 430, 453 P.2d 526 (1969); Culbertson v. Cizek, 225 Cal.App.2d 451, 37 Cal.Rptr. 548 (1964); Rockwood Sprinkler Co. v. Phillips Co., 265 Ill.App. 267 (1932). But see Drywall Interior Systems v. Ladue Bldg., 857 S.W.2d 523 (Mo.App.1993).

This rule is consistent with the well-known principle that a statutory construction which restricts or removes a common-law right should not be adopted unless the plain words of the statute compel it. See, Lackman v. Rousselle, 257 Neb. 87, 596 N.W.2d 15 (1999); Stoneman v. United Neb. Bank, 254 Neb. 477, 577 N.W.2d 271 (1998). The NCLA contains neither an express provision nor any language indicating that the NCLA was meant to preclude other remedies that a construction lienholder might pursue to collect a contractual debt. We therefore conclude that the NCLA does not take away a construction lienholder's common-law right to sue for breach of contract.

Because the NCLA does not preclude an action for breach of contract, Tilt-Up was entitled to bring such an action despite the pendency of its construction lien foreclosure action. The only limitation is that any amount recovered for breach of contract damages would be credited to satisfy the construction lien when necessary to prevent a double recovery. See, Culbertson v. Cizek, supra (money collected on personal judgment to be credited to mechanic's lien); § 52-136(1) (amount of lien is for unpaid part of contract price). Compare Tilt-Up I (payments previously made by Star City to Tilt-Up credited to lien).

Tilt-Up argues that it was nonetheless barred from bringing a breach of contract action because it had obtained a judgment from the district court in the construction lien foreclosure action which included breach of contract damages and could not seek further...