United Metro Materials, Inc. v. PENA BLANCA PROPERTIES

• Decision Date: 04 April 2000
• Docket Number: No. 1 CA-CV 99-0331.,1 CA-CV 99-0331.
• Parties: UNITED METRO MATERIALS, INC., an Arizona corporation, doing business as San Xavier Rock & Materials, Plaintiff-Counterdefendant, Appellee, v. PENA BLANCA PROPERTIES, L.L.C., an Arizona limited liability company, Defendant-Counterclaimant, Appellant.
• Court: Arizona Court of Appeals

4 P.3d 1022

197 Ariz. 479

UNITED METRO MATERIALS, INC., an Arizona corporation, doing business as San Xavier Rock & Materials, Plaintiff-Counterdefendant, Appellee, v. PENA BLANCA PROPERTIES, L.L.C., an Arizona limited liability company, Defendant-Counterclaimant, Appellant.

No. -0331.

Court of Appeals of Arizona, Division 1, Department C.

April 4, 2000.

DeConcini McDonald Yetwin & Lacy, P.C. by Philip R. Wooten, Phoenix, for Appellee.

Jon R. Pozgay, Ltd. by Jon R. Pozgay, Phoenix, for Appellant.

OPINION

EHRLICH, Judge.

¶ 1 United Metro Materials, doing business as San Xavier Rock & Materials ("San Xavier"), filed suit to foreclose its lien for materials supplied for the Pena Blanca Highlands project of Pena Blanca Properties, L.L.C. ("Pena Blanca"). Pena Blanca obtained a lien-discharge bond pursuant to Arizona Revised Statutes ("A.R.S.") section 33-1004 from Far West Insurance Company ("Far West"), thereby removing San Xavier's lien from the property by operation of law. San Xavier then filed an amended complaint to assert a claim on the bond against Pena Blanca and Far West. In response, Pena Blanca counterclaimed, seeking damages from San Xavier for filing a wrongful lien.

¶ 2 Cross-motions for summary judgment were filed. The trial court granted San Xavier's motion for the amount stated in the lien, and it awarded attorneys' fees. Pena Blanca's subsequent motion for new trial was denied.

¶ 3 Pena Blanca appealed. We affirm the judgment.

BACKGROUND¹

¶ 4 Pena Blanca acquired a large tract of land near Nogales, Arizona. It sold a portion of the land to the Nogales School District, but it retained the remainder of the tract for a project known as Pena Blanca Highlands.

¶ 5 On May 24, 1995, Pena Blanca entered a contract with Able Contracting, Inc. ("Able"), to provide contracting and construction services for Pena Blanca Highlands. Two months later, Able began to purchase materials on credit from San Xavier for use on this project.² ¶ 6 For the materials San Xavier supplied to Able for Pena Blanca Highlands, pursuant to A.R.S. § 33-992.01, San Xavier's lien service filed and served on Pena Blanca four preliminary 20-day notices dated September 5 and 29 and November 3 and 16, 1995; each notice identified the job site as "Frontage Road Off I-19 ... Pena Blanca Highlands" and included the project's legal description. There is no dispute that Pena Blanca received these notices.

¶ 7 According to the joint-check provision in the contract between Able and Pena Blanca,³ Pena Blanca made the following three payments to Able and San Xavier to reimburse them for materials:

DATE CHECK NUMBER AMOUNT OF CHECK 10-10-95 2437 $ 2,207.97 11-10-95 2452 $31,987.14 12-08-95 2481 $12,824.25

For each of these joint checks, Able issued its own check solely payable to San Xavier for at least the amount of the joint check, and San Xavier endorsed the joint check to Able.

¶ 8 Because San Xavier received these checks from Able as payment for materials, San Xavier executed three "unconditional lien waivers" pursuant to A.R.S. § 33-1008. On the first unconditional lien waiver, dated November 13, 1995, San Xavier stated that it had received $2208.00 for all materials furnished to Able for Pena Blanca Highlands for the month of September 1995. The second unconditional lien waiver, dated November 20, 1995, specified that San Xavier had received a payment of $34,987.14 for materials provided to Able for Pena Blanca Highlands through October 31, 1995.

¶ 9 Prior to executing the last of the three waivers, however, San Xavier received a letter dated December 11, 1995, from Able with Able's check number 5440 and a joint check from Pena Blanca, each in the identical amount of $12,854.50. Also enclosed in the letter was an unconditional lien waiver for San Xavier to execute. The author of the letter explained that the check from Able was a "partial payment through November 30, 1995," and San Xavier was instructed to apply the check to San Xavier's invoice numbers 153915 and 153604. Although the check equaled the total amount of the sums due according to these two invoices, other invoices for materials delivered during November 1995 remained unpaid.

¶ 10 Consequently, before signing and returning this unconditional lien waiver form to Able, San Xavier's credit manager typed in the blank space on the form which was to be used for specifying the date covered by the waiver, that the waiver was "Partial through November 30, 1995." He then drew a line from these words to a blank area of the form where he also wrote "for invoices 153915 153604 only!" followed by his signature. As of December 18, 1995, the date of the form, Pena Blanca received notice that San Xavier had unpaid invoices remaining.

¶ 11 Thereafter, Pena Blanca issued no more joint checks payable to Able and San Xavier. However, Pena Blanca did issue at least three more checks in January and February 1996 payable solely to Able in the combined amount of $35,283.62. It also issued another check payable solely to Able in the amount of $61,878.00 in December 1995.

¶ 12 San Xavier never received payment for the other materials it had supplied in November 1995, nor for the additional materials it supplied during the following months of December, January and February. Accordingly, on March 8, 1996, San Xavier recorded a lien on Pena Blanca's property in the amount of $33,854.10 to protect its right to recover the reasonable value of the materials it had supplied to Able for the Pena Blanca Highlands.⁴ Additionally, in order to evaluate the position it would take regarding the lien, Pena Blanca obtained copies of San Xavier's invoices to Able for the materials it had supplied to Pena Blanca, both those for which San Xavier had been paid and those for which San Xavier claimed that it had not received payment.

¶ 13 Meanwhile, Pena Blanca terminated Able for non-performance. Rather than find another contractor, on February 16, 1996, Pena Blanca contracted directly with San Xavier to purchase on credit materials it needed to finish the Pena Blanca project. According to this credit agreement, San Xavier supplied materials directly to Pena Blanca from March through June 1996.

¶ 14 During this time, San Xavier sent Pena Blanca two new preliminary 20-day notices for the additional materials to be supplied, reflecting its new direct relationship with Pena Blanca. San Xavier also executed four unconditional lien waivers for the materials it supplied under the direct agreement with Pena Blanca. These unconditional lien waivers differed from the previous waivers San Xavier had executed in one key respect: These unconditional lien waivers identified Pena Blanca instead of Able as the entity with which San Xavier had contracted to supply these materials for the Pena Blanca Highlands project. Pena Blanca eventually paid in full for the materials supplied directly to it pursuant to this agreement.

¶ 15 Pena Blanca ultimately refused to pay San Xavier for the additional materials that were the subject of the lien dated March 8, 1996. Because San Xavier claimed to have supplied to Able these materials for the Pena Blanca Highlands and not been reimbursed, San Xavier filed this action to foreclose the lien.

¶ 16 In opposition to San Xavier's Motion for Summary Judgment, Pena Blanca urged the following defenses: (1) San Xavier waived its lien rights, (2) San Xavier should be equitably estopped from claiming a lien against Pena Blanca, and (3) San Xavier did not meet its burden of proving the reasonable value of the materials it had supplied to the project so as to be entitled to summary judgment. The trial court found no merit in Pena Blanca's arguments, and it determined that San Xavier was entitled to summary judgment as a matter of law.

STANDARD OF REVIEW

¶ 17 In reviewing a summary judgment, we view the facts in the light most favorable to the party opposing the judgment. See Hartford Accident & Indem. Co. v. Federal Ins. Co., 172 Ariz. 104, 107, 834 P.2d 827, 830 (1992)

. In that context, our task is to determine whether there is a genuine issue of disputed material fact and, if not, whether the trial court correctly applied the substantive law. See Matter of Estate of Johnson, 168 Ariz. 108, 109, 811 P.2d 360, 361 (1991).

DISCUSSION

1. Jurisdiction

¶ 18 San Xavier initially challenges this court's jurisdiction to consider Pena Blanca's appeal. The trial court entered judgment on June 19, 1998, but Pena Blanca failed to file a notice of appeal within the 30 days allowed by Arizona Rule of Civil Appellate Procedure ("Appellate Rule") 9(a). It also failed to file any of the time-extending motions set forth in subsection (b) of that rule within the 15-day time limits. Appellate Rule 9(a) gives the trial court discretion, though, to extend the time for appeal under such limited circumstances as follow:

If the court finds that (1) a party entitled to notice of entry of judgment did not receive such notice from the clerk or any party within 21 days of its entry and (2) no party would be prejudiced, the court may upon motion filed not later than 30 days after the expiration of the time for appeal, or within 7 days of receipt of such notice, whichever is earlier, extend the time for appeal for a period not to exceed 14 days from the date of the order granting the motion.

¶ 19 The trial court similarly has discretion pursuant to Arizona Rule of Civil Procedure ("Civil Rule") 6(b) to extend the time for filing any of the time-extending motions, which, for the most part, otherwise are not subject to extension:

[The court] may not extend the time for taking any action under Rules 50(b), 52(b), 59(d), (g) and 60(c), except to the extent and under the conditions stated in them, unless the court finds (a) that a party entitled to notice of the entry of judgment or order did not receive such notice from the clerk or any party within 21 days of its entry, and (b) that no party would be

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