Urban Development Co. v. Dekreon, 2028

• Decision Date: 13 September 1974
• Docket Number: No. 2028,2028
• Citation: 526 P.2d 325
• Parties: URBAN DEVELOPMENT COMPANY, Appellant, v. Joseph J. M. DEKREON, Appellee.
• Court: Alaska Supreme Court

Page 325

526 P.2d 325

URBAN DEVELOPMENT COMPANY, Appellant, v. Joseph J. M. DEKREON, Appellee.

No. 2028.

Supreme Court of Alaska.

Sept. 13, 1974.

John R. Strachan, Robison, McCaskey, Strachan & Hoge, Anchorage, for appellant.

Warren C. Colver, Anchorage, for appellee.

Before RABINOWITZ, C. J., and CONNOR, ERWIN, BOOCHEVER and FITZGERALD, JJ.

OPINION

CONNOR, Justice.

This is an appeal from a judgment ordering foreclosure of a lien for services rendered in the improvement of real property. Appellant asserts error in: (1) the interpretation of an agreement on which part of appellee's claim in the foreclosure action was based; (2) the computation of the value of appellee's lien; (3) the failure of the trial court to make adequate findings of fact and conclusions of law; and (4) the procedure by which attorney's fees were awarded.

In May and June of 1971, appellant Urban Development entered into two earnest money agreements with S. G. Heflin to sell to Heflin 22 lots in the Dimond Birch Subdivision near Anchorage, Alaska. This property is the subject of this suit.

In June 1971, appellee Dekreon entered into a written agreement with Heflin under which Dekreon was to supervise construction on these lots. This agreement provided that Dekreon and Heflin were to share equally the profit and loss on each job. Dekreon was to be paid 'a draw of 1,000 per month, the draw to be considered as an advance against (his) anticipated share of profits.' If no profits were realized on a particular project, the agreement provided that '. . . the portions of (Dekreon's) draw advanced for such job may be withheld by (Heflin) from the next job on which there is profit.'

Dekreon began working on the Dimond Birch project in August 28, 1971. He testified that the duties he performed included supervising the construction work, obtaining bids, arranging for subcontractors, accounting, and general coordination of the construction project. Thomas McKeever, secretary-treasurer of Urban Development, Inc., visited the Dimond Birch Subdivision at least occasionally and knew that Dekreon was working on the property.

The agreement between Dekreon and Heflin was rescinded orally in late November of 1971 and in writing on January 28, 1972. These parties then orally reached another agreement under which Dekreon was to be paid $9 per hour on a 60-hour a week basis. It is unclear from the testimony whether this rate was intended to be retroactive to the date he began work on the Dimond Birch project or whether it was to apply only to work done after the termination of the written agreement in November. There is no indication in the record that Dekreon's duties changed because of the new agreement.

Dekreon testified that he worked 640 hours from August through November 1971, and that he worked an additional 51 1/2 hours from November 1971 through the spring of 1972. The testimony is in conflict as to whether Dekreon ever received any money for his work on the Dimond Birch project. It is uncontested that there were no profits of that project.

In August 1972, the contract between Heflin and Urban Development for the sale of the Dimond Birch properties was terminated.

On August 23, 1972, Dekreon filed a claim of lien against twenty-two lots located in the Dimond Birch Subdivision. On October 18, 1972, suit was filed to foreclose the claim of lien. Trial was held before the superior court on May 1-2, 1973. On May 2, a minute order was entered rendering an oral decision in favor of the plaintiff for $4,463.50. This amount was based on the $1,000 per month draw provided for in the June 1971 agreement between Heflin and Dekreon for services performed from August to November 1971 and, apparently, on the $9 per hour rate agreed upon by Heflin and Dekreon for services performed after the rescission of the written agreement. ¹

Appellee was asked to submit written findings of fact and conclusions of law to the court. This was apparently done (they do not appear on the record on appeal) but appellant objected to these submissions.

A hearing was scheduled for June 6 on the objections to these submissions. On June 4, 1973, however the court decided to adopt its oral decision of May 2 as its findings of fact and conclusions of law.

The question of attorney's fees was left open in the June 4 proceedings. At some point, however, the sum of $1,070.34 for attorney's fees was entered in the June 4 judgment. Costs of $85.53 were also awarded to appellee.

Appellant first asserts that appellee is not entitled to foreclose a labor lien on appellant's land because of the agreement he had with Heflin. By this agreement, appellee and Heflin became either partners or joint venturers, and agreed that appellee would get a monthly draw as an advance against future profits. There were no profits. Thus, it is argued, there could be no valid lien because he was owed no money.

It is important to point out that, for the purposes of AS 34.35.050, ² the agreement establishing a partnership or joint ventureship does not affect appellee's standing to file a lien against appellant's land. It is uncontested that Dekreon worked on the Dimond Birch Subdivision and that Mr. McKeever, secretary-treasurer of Urban Development, knew that he was doing so. Thus, the real issue presented by appellant's argument concerns the interpretation of the agreement.

This agreement permits conflicting interpretations as to whether appellee was entitled to the amount of the draw if there were no profits on the Dimond Birch project. The trial court found that there were no profits on the project. Nevertheless, it decided that Dekreon was entitled to the amount of the draw for four months of services. No finding was made to explain this conclusion. If the court decided that Dekreon was entitled to the amount of the draw in the absence of profits on this particular project on the basis of the wording of the agreement, the subsequent conduct of the parties, or both, such a finding should have been made.

Moreover, the evidence does not support an award based on four months of services performed under this agreement. Dekreon, by his own testimony, did not devote his time to the Dimond Birch project until August 28. The court found that the agreement was terminated 'sometime around the end of November'. Thus, Dekreon worked, at most, only slightly over three months on this project under the agreement which provided for a $1,000 monthly draw.

In addition to the dispute over the interpretation of the agreement, appellant contends that appellee was not entitled to a lien on the Dimond Birch property for the full value of his services during this period because some of his time was spent on subdivisions other than Dimond Birch. The evidence on this question is in conflict. While there is testimony that some of Dekreon's services were performed on other projects, there is some evidence that Dekreon had worked substantially only at Dimond Birch during the time period in question. Again, the trial court made no finding resolving the conflict.

There is no indication in the record that the court considered the question of Dekreon's work on other projects. See Spenard Plumbing & Heating Co. v. Wright, 370 P.2d 519, 525 (Alaska 1962). It is unclear to us whether the court rejected the rather substantial testimony that Dekreon worked on other projects during this period, or whether it concluded that he was entitled to the lien on Dimond Birch for the full value of his services despite the fact that much of his time was spent on other work sites.

The requirement of Civil Rule 52(a) ³ that specific findings of fact and conclusions of law be made by the trial court is intended to facilitate the work of both the trial judge and the appellate court.

'. . . (T)he requirement that the trial judge file findings of fact gives assurance that he has exercised care...