Precision Framing Sys. Inc. v. Luzuriaga, 251 Cal. Rptr. 3d 858, 39 Cal. App. 5th 457 (2019)

Aug. 29, 2019 · Court of Appeal, Fifth District, California · E069158
251 Cal. Rptr. 3d 858, 39 Cal. App. 5th 457

PRECISION FRAMING SYSTEMS INC., Plaintiff and Appellant,
v.
Henry LUZURIAGA et al., Defendants and Appellants.

E069158

Court of Appeal, Fourth District, Division 2, California.

Filed August 29, 2019

Certified for Partial Publication.*

Tyler & Bursch, Jennifer L. Bursch, James A. Long, and Nada N. Higuera, for Plaintiff and Appellant.

Law Offices of Jonathan C. Stevens and Jonathan C. Stevens, for Defendants and Appellants.

RAMIREZ P. J.

*459Henry and Deborah Luzuriaga contracted with a general contractor for the construction of a commercial building. The general contractor, in turn, contracted with Precision Framing Systems, Inc. (Precision) for the framing, including the necessary trusses. And Precision contracted with Inland Empire Truss, Inc. (Inland) for the fabrication of the trusses. Precision never received full payment. Accordingly, it recorded a mechanic's lien claim.

Meanwhile, there was a problem with some of the trusses. There was much finger-pointing as to who was to blame. After Precision had already recorded its mechanic's lien claim, Precision and/or Inland came back to the site and repaired the trusses.

*460Precision filed this action to foreclose its mechanic's lien. Ms. Luzuriaga filed a cross-complaint. The trial court granted summary judgment against Precision on its complaint. It ruled that the mechanic's lien claim was filed prematurely - i.e., before Precision had "cease[d] to provide work." ( Civ. Code, § 8414, subd. (a).)

Precision appeals. Its primary contention is that there was a triable issue of fact as to whether it had ceased to provide work, because (1) "ceas[ing]," within the meaning of the statute, can be a gradual process, (2) the repair of the trusses was not part of Precision's "work," (3) there was evidence that Precision completed all of its work before it recorded its mechanic's lien claim, and (4) there was evidence that the repairs were done by Inland. Henry Luzuriaga and the Luzuriagas' bonding company cross-appeal.1

*861We will affirm. We agree with the trial court: The evidence showed, beyond a triable issue of fact, that Precision had not yet "cease[d] ... work" when it recorded its mechanic's lien claim. This moots the cross-appeal.

I

FACTUAL BACKGROUND

The following facts are taken from the evidence introduced in connection with the motion for summary judgment.

The Luzuriagas undertook the construction of a veterinary hospital on a piece of property that they owned in Wildomar. They hired an architect and a general contractor. The general contractor, in turn, hired Precision as the framing subcontractor. Precision's contract stated that that the contact price was "for labor, lumber, trusses, and hardware necessary to complete the ... project." (Capitalization altered.)

George Mears is the president of Precision. He testified that Precision was supposed to "supply and install[ ]" the trusses. In its interrogatory responses, Precision stated that its scope of work consisted of framing, including "procurement of materials (lumber[,] hardware and trusses)."

Precision selected Inland to design and manufacture the trusses. As Mears put it, "Precision used Inland" for the trusses. Inland contracted solely with Precision and invoiced Precision, although Inland was paid directly by the construction lender.

*461Inland designed the trusses, based on the plans and specifications, and built them. However, the architect had to approve the truss design, incorporate it into his plans, and make sure they matched (redesigning his own plans if necessary). Thus, as the general contractor testified, the "truss details" were "ultimately[ ] the architect's responsibility."2

On July 24, 2013, Precision started work on the framing. On July 29, 2013, Inland delivered the trusses to the site. On August 2, 2013, Precision began installing the trusses.

On August 7, 2013, the city issued a correction notice relating to the trusses. It stated: "Truss bearing points are not as per plan ...." In the architect's opinion, this was because the trusses were not fabricated in accordance with the plan. On August 14, 2013, Precision notified Inland that the trusses were defective. Later in August 2013, Inland carried out some repairs to the trusses.

On December 9, 2013, the city issued a second correction notice relating to the trusses.

On December 23, 2013, the general contractor and Precision's superintendent "walked the [p]roject" together. The general contractor found that Precision's work was complete and fully in compliance with the plans and specifications. At that point, according to both Mears and the general contractor, Precision had completed its scope of work. The city approved Precision's framing work.

Precision, however, never received full payment. Ms. Luzuriaga told Mears "she was not interested in paying Precision and told [him] to sue her." Accordingly, on *862January 2, 2014, Precision recorded its mechanic's lien claim for $53,268.16. *462Sometime between January 2 and 29, 2014, the Luzuriagas changed the locks of the building, locking out all contractors.

Sometime between January 20 and 29, 2014, Mears met with the architect and the building inspector. At this meeting, he later testified, he first became aware of the correction notices.3

On January 29, 2014, Ms. Luzuriaga took the position that Precision's mechanic's lien claim was "premature" because it had not yet completed its scope of work, and in particular because the correction notices were still outstanding. She asked, "Does Precision ... intend to return to the job and correct the issues that are pending?" Mears responded, "We intend on completing any work pursuant to our contract ... [W]e are willing to meet and discuss any remaining scope ...."

On February 4, 2014, Precision told Ms. Luzuriaga that it could not determine whether the issues in the correction notice were within its scope of work because it was locked out.

On February 12, 2014, Ms. Luzuriaga told Mears that she would be at the site the following day. She continued, "If you would like to visit the project with respect to the City's correction notice ..., you can come by then." Mears responded that he would and added, "The truss company will also be in attendance to make sure that the repairs were made. If they are not they will complete them then."

Meanwhile, Inland had prepared repair designs and had done the related structural calculations. On February 12 or 13, 2014, Inland carried out the repairs. Mears was present to "accompany" Inland, and he "helped coordinate the repairs."4 The repairs themselves took two or three hours

II

PROCEDURAL BACKGROUND

In 2014, Old Republic Surety Company (Old Republic) filed a complaint (Case No. SWC1400869) against Ms. Luzuriaga, Precision, and others.

*463Ms. Luzuriaga filed a cross-complaint against Precision and a host of other defendants. Her operative (first amended) cross-complaint alleged that, at all relevant times, Precision lacked a contractor's license. It also alleged that Precision's mechanic's lien claim had been filed prematurely.

Meanwhile, also in 2014, Precision filed a separate complaint (Case No. fMCC1400466) against the Luzuriagas, American Contractors Indemnity Company (American), and others.5 The operative *863(second amended) complaint asserted a single cause of action for foreclosure of mechanic's lien. The Luzuriagas asserted various affirmative defenses, including that Precision "was an unlicensed contractor ...."

The trial court consolidated the two cases.

In 2015, Precision filed a motion for summary adjudication of the Luzuriagas' defenses. The trial court granted summary adjudication in favor of Precision on the unlicensed contractor defense.

In 2017, the Luzuriagas moved for summary judgment on Precision's complaint, on the ground that Precision had filed its mechanic's lien prematurely. The trial court granted the motion and entered judgment accordingly.

Precision filed a timely notice of appeal. The Luzuriagas filed a timely notice of cross-appeal. However, we dismissed Ms. Luzuriaga as both an appellant and a respondent, because her cross-complaint against Precision (and others) was still pending.

III***

IV

TIMELINESS OF THE MECHANIC'S LIEN CLAIM

As mentioned, Precision contends that there was evidence that its mechanic's lien claim was not premature.

*464"A trial court may only grant a motion for summary judgment if no triable issues of material fact appear and the moving party is entitled to judgment as a matter of law. [Citations.]" ( Schachter v. Citigroup, Inc. (2009) 47 Cal.4th 610, 618, 101 Cal.Rptr.3d 2, 218 P.3d 262.) "In ruling on the motion, the court must 'consider all of the evidence' and 'all' of the 'inferences' reasonably drawn therefrom [citation], and must view such evidence [citations] and such inferences [citations], in the light most favorable to the opposing party." ( Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843, 107 Cal.Rptr.2d 841, 24 P.3d 493.) "Whether the trial court erred by granting [the] motion for summary judgment is a question of law we review de novo. [Citation.]" ( Samara v. Matar (2018) 5 Cal.5th 322, 338, 234 Cal.Rptr.3d 446, 419 P.3d 924.)

"A mechanic's lien is a claim against real property, which may be filed if a claimant has provided labor or furnished materials for the property and has not been paid. [Citation.]" ( Brewer Corp. v. Point Center Financial, Inc. (2014) 223 Cal.App.4th 831, 839, 167 Cal.Rptr.3d 555.) Thus, " '[it] is a procedural device for obtaining payment of a debt [owed] by a property owner for the performance of labor or the furnishing of materials used in construction.' [Citation.]" ( North Bay Construction, Inc. v. City of Petaluma (2006) 143 Cal.App.4th 552, 555, 49 Cal.Rptr.3d 455.)

"Mechanics' lien law derives from our state Constitution .... The mechanics' lien is the only creditors' remedy stemming from constitutional command and our courts 'have uniformly classified the mechanics' lien laws as remedial legislation, to be liberally construed for the protection of laborers and materialmen.' [Citation.]" ( Hutnick v. U.S. Fidelity & Guaranty Co. (1988) 47 Cal.3d 456, 462, 253 Cal.Rptr. 236, 763 P.2d 1326.)

*864"However, ' "[a]lthough mechanic's lien laws should be liberally construed to protect those who have contributed skills, services or materials, towards the improvement of property, it has been recognized that lien laws are for the protection of owners as well as mechanic's lien claimants." ' [Citation.]" ( Moorefield Construction, Inc. v. Intervest-Mortgage Investment Co. (2014) 230 Cal.App.4th 146, 155, 178 Cal.Rptr.3d 709.)

"The section of the Constitution referred to is not self-executing, and is inoperative except as supplemented by legislation. [Citations.]" ( Ferger v. Gearhart (1919) 44 Cal.App. 245, 247, 186 P. 376, disapproved on other grounds in Theisen v. County of Los Angeles (1960) 54 Cal.2d 170, 182, 5 Cal.Rptr. 161, 352 P.2d 529.) " ' "Mechanics' liens are entirely of statutory creation, and the statute must be looked to both for the right to the lien and the mode by which it can be enforced. The right to a mechanic's lien depends upon a compliance with the statute, and in order that a valid lien may arise *465and be enforced, the claimant must strictly, or at least substantially, observe and comply with the provisions of the statute, none of which may be regarded as unessential." ' [Citation.]" ( Sukut Construction, Inc. v. Rimrock CA LLC (2011) 199 Cal.App.4th 817, 824, 131 Cal.Rptr.3d 874.)

The crucial statute here is Civil Code section 8414, which provides:

"A [mechanic's lien] claimant other than a direct contractor may not enforce a lien unless the claimant records a claim of lien within the following times:

"(a) After the claimant ceases to provide work.
"(b) Before the earlier of the following times:
"(1) Ninety days after completion of the work of improvement.
"(2) Thirty days after the owner records a notice of completion or cessation."

Civil Code section 8414 is just the most recent in a series of statutes setting the earliest and/or latest time for recording a mechanic's lien claim. (Civ. Code, former § 3116, Stats. 1969, ch. 1362, § 2, p. 2762; Code Civ. Proc., former § 1193.1, subd. (c), Stats. 1951, ch. 1376, § 2, p. 3290; Civ. Code, former § 1187, 1 Ann. Code Civ. Proc., § 45 (1st ed. 1872, Haymond & Burch, commrs.-annotators) p. 49.) Like the present version, most of them set the earliest time based on either the subcontractor's cessation of its own work or the completion (or cessation) of the overall work of improvement.7 While the triggers that were based on the completion of the overall work of improvement have varied, the triggers that were based on the subcontractor's cessation of its own work were all similar.

For example, the version enacted in 1919 required a subcontractor to file any mechanic's lien claim "after he has ceased to perform labor or furnish material, or both ...." (Former Civ. Code, § 1187, Stats. 1919, ch. 146, § 1, p. 190.)

The version enacted in 1969 required a subcontractor to file any mechanic's lien claim "after he has ceased furnishing labor, services, equipment, or materials ...." (Former Civ. Code, § 3116, Stats. 1969, ch. 1362, § 2, p. 2762.)

*865*466We perceive no relevant substantive difference between these various formulations. Indeed, Civil Code section 8414 was intended to reenact the 1969 version "without substantive change." (Cal. Law Revision Com. com., 12C West's Ann. Civ. Code (2012 ed.) foll. § 8414, p. 199.) Accordingly, older cases construing and applying "ceas[ing]" remain good law. (See Century Superior Gunite, Inc. v. Rodriguez (1981) 118 Cal.App.3d Supp. 12, 15, 173 Cal.Rptr. 661 [case construing Civ. Code, former § 1187 is helpful in construing Civ. Code, former § 3116 ].)

Under every version of the statute, a mechanic's lien claim that is filed prematurely is void and cannot be enforced. ( Marchant v. Hayes (1898) 120 Cal. 137, 138-139, 52 P. 154 ; McCreary v. Toronto Midway Oil Co. (1918) 38 Cal.App. 17, 20, 175 P. 87.)

Precision notes that the Merriam-Webster Dictionary defines "cease" as "to cause to come to an end especially gradually : no longer continue." (Merriam-Webster OnLine Dict. < https://www.merriam-webster.com/dictionary/cease> [as of Aug. 27, 2019], italics added.) It therefore argues that "the phrase 'ceases to provide work' does not require that all work be completely stopped prior to recording a lien. Instead, all that it required is, prior to recording, a contractor gradually cause to come to an end, the supply or availability of labor to a work of improvement."

We disagree. "Cease" means to end. Ending is required; ending gradually is optional.8 If something is in the process of coming to an end, it may be ceasing , but it has not ceased. According to the Merriam-Webster use note, "cease" - as compared to such synonyms as "stop," "quit," "discontinue," and "desist" - "may add a suggestion of gradualness and a degree of finality. " (Merriam-Webster Online Dict., supra , italics added.) As Luzuriaga argues, interpreting "cease" as meaning gradually coming to an end would make the moment when "ceasing" occurs unduly subjective and difficult to determine.

Precision also relies on the statutory definition of "work." " 'Work' means labor, service, equipment, or material provided to a work of improvement." ( Civ. Code, § 8048.) And " 'work of improvement' means the entire structure or scheme of improvement as a whole ...." ( Civ. Code, § 8050, subd. (b).) Precision therefore argues that here, "the 'work of improvement' was the construction of a veterinary hospital, as opposed to discrete repairs or alterations made to the veterinary hospital."

*467This argument assumes what it seeks to prove - that the repairs were "discrete" from the construction. However, the statutory definition of "work of improvement" includes the "[c]onstruction, alteration, [or] repair , ... in whole or in part, of ... a building ...." ( Civ. Code, § 8050, subd. (a)(1), italics added.) Thus, a work of improvement, as a whole, can include both construction and repairs.

On the other hand, Luzuriaga argues that the definitions of "work" and "work of improvement" are irrelevant; the only question is whether Precision "had ceased its work on the Project." But this argument, too, assumes what it seeks to prove - that the repairs were part of "the Project."

*866Because the issue is whether Precision had ceased to provide "work," and because "work" is defined in terms of the overall "work of improvement," we conclude that this issue must be analyzed in terms of whether the repairs were part of the "scheme of improvement as a whole."

As Precision notes, case law supports this view.

For example, in Nevada County Lumber Co. v. Janiss (1938) 25 Cal.App.2d 579, 78 P.2d 200, the trial court found that the construction of two cabins was complete on December 20, 1935, and therefore a subcontractor's lien claim filed on March 16, 1936 was timely.9 ( Id. at p. 582, 78 P.2d 200.) The evidence showed that a tenant had moved into one of the cabins on December 2, 1935. ( Ibid. ) Before then, however, the sewer pipes had been accidentally blocked with cement. ( Id. at p. 583, 78 P.2d 200.) Accordingly, between December 16 and 20, 1935, the general contractor removed and replaced the sewer pipes. ( Ibid. )

The appellate court upheld the finding that the work was not complete until the sewer pipes were replaced. ( Nevada County Lumber Co. v. Janiss , supra , 25 Cal.App.2d at pp. 582-584, 78 P.2d 200.) It noted that "[t]he fulfillment of the contract in question required the construction of a suitable sewer system to connect the building with a septic tank." ( Id. at p. 583, 78 P.2d 200.) Thus, it described the replacement as "substantial work necessary to the completion of the contract ...." ( Id. at p. 582, 78 P.2d 200.)

Similarly, in Hundley v. Marinkovich (1942) 53 Cal.App.2d 288, 127 P.2d 600, the trial court found that the construction of a building was complete on November 9, 1939, so that a subcontractor's mechanic's lien claim filed on December 21, 1939 was untimely.10 ( Id. at pp. 289-290, 127 P.2d 600.) The subcontractor had finished all other work on the building on November 8, 1939, but *468on November 29, 1939, it had replaced a defective lock part with a new part worth $4.12. ( Id. at p. 290, 127 P.2d 600.)

The appellate court upheld the trial court's finding. ( Hundley v. Marinkovich , supra , 53 Cal.App.2d at pp. 292-293, 127 P.2d 600.) It rejected the subcontractor's argument "that a substitution or replacement of material, at the demand of the owner or the original contractor" extended the time to record a mechanic's lien claim. ( Id. at p. 292, 127 P.2d 600.) It relied on the trial court's additional finding that the lock part "constituted no part of the construction of said building," as well as on the fact that labor had ceased and the owners had taken possession and had recorded a notice of completion. ( Id. at pp. 290, 293, 127 P.2d 600.)

In summary, then, while the outcomes in Nevada County and Hundley were opposite, their underlying analytic approach was the same: They looked to whether the repairs were part of the overall scheme that constituted the work of improvement.11

*867Luzuriaga argues that Nevada County and Hundley are irrelevant because they involved belated lien claims, rather than premature lien claims. (It could also be argued that they turned on the completion of an overall work of improvement, rather than the cessation of an individual subcontractor's work.) Nevertheless, they speak to the larger question of whether the time to file a lien claim runs from repairs done after other work is complete. With respect to an individual subcontractor, they support Precision's contention that this turns on the subcontractor's scope of work.

We turn, then, to whether there was a triable issue of fact as to whether the repairs were part of the "work" that Precision was to provide to the "work of improvement."

Precision's contract provided that its price was for, among other things, the "trusses ... necessary to complete the ... project." (Capitalization altered.) In Precision's view, this did not require it to design the trusses; rather, it was up to the architect to design the trusses, and all Precision had to do was to supply trusses in conformity with his designs. Accordingly, the repairs were not within its scope of work.

*469We disagree, for two reasons. First, even assuming the architect did design the trusses, the contract called for Precision to supply the trusses necessary to complete the project , not merely trusses in conformity with the plans. As long as the notices of correction were outstanding, the project could not be completed. If the notices of correction were traceable to a flaw in the architect's design, arguably Precision would be entitled to extra compensation for the repairs; nevertheless, the repairs constituted "substantial work necessary to the completion of the contract ...." ( Nevada County Lumber Co. v. Janiss , supra , 25 Cal.App.2d at p. 582, 78 P.2d 200.)

Second, as discussed in footnote 2, ante , uncontradicted evidence showed that Inland, not the architect, designed the trusses. The architect was "responsib[le]" for the design, in the sense that he had to approve it and had to make sure it would work with the rest of the building, but the actual design work was done by Inland. While the written contract was ambiguous with respect to whether Precision was required to design the trusses, the other evidence demonstrates that it was. Precision contracted with Inland for the trusses. Inland's only contract was with Precision. Moreover, Inland invoiced Precision. In other words, Inland was Precision's subcontractor. This course of dealing demonstrates that Precision's contract required it to provide design services.

In the trial court, Precision purported to dispute the fact that Inland was its subcontractor. The evidence that it cited, however, failed to raise any triable issue. For example, it cited Mears's testimony that the construction lender paid Inland directly. As he explained, however, this was done "to ensure that the material suppliers were paid" - i.e., so Inland could not file a mechanic's lien claim. Presumably, these sums came out of the amounts due to Precision.

It also cited the evidence that the general contractor inspected Precision's work and found no deficiencies; both Mears and the general contractor testified that, at that point, Precision had completed its scope of work. But because the scope of work was established by the relevant contracts, this was merely the factually unsupported *868legal opinion of two lay witnesses. Thus, even in the absence of an objection, it was not substantial evidence that the repair of the trusses was not within Precision's scope of work. (See Lockheed Martin Corp. v. Superior Court (2003) 29 Cal.4th 1096, 1110, 131 Cal.Rptr.2d 1, 63 P.3d 913 ; Wise v. DLA Piper LLP (US) (2013) 220 Cal.App.4th 1180, 1191-1192, 164 Cal.Rptr.3d 54.)

If, when Precision recorded its mechanic's lien claim, it did not know that it had any work left to do, it may seem unfair to hold that it recorded its claim prematurely. However, we have not found any case law suggesting that a claimant's subjective knowledge or belief as to whether it has ceased to *470provide work is relevant. In any event, it did know by then that there was some kind of problem with the trusses. (See fn. 3, ante. ) Moreover, nothing in the Mechanic's Lien Law prohibited it from recording its claim again after the repairs were performed.

We conclude that the repair of the trusses was part of Precision's "work." It does not matter whether Precision actually carried out the repairs itself or merely "helped coordinate" them. Hence, the trial court correctly granted summary judgment against Precision.

V-VII

VIII

DISPOSITION

The judgment is affirmed. In the interest of justice, each side shall bear its own costs.

We concur:

McKINSTER J.

SLOUGH J.