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HomeMy WebLinkAbout955635v. FILED IN THE DISTRICT COURT OF THE THIRD JUDICIAL DISTRICT l) SEP -3 2010 IN AND FOR THE COUNTY OF LINCOLN, STATE OF WYOMING KENNETH D. ROBERTS CLERK OF Cry: R C COURT 3rd JUD CIAL DISTRICT LINCOLN COUNTY, STATE OF WYOMING LAZE LLC, a Wyoming limited liability company; DON ZEBE; And RICK LAWSON. Petitioners, DAIRY SYSTEMS COMPANY, INC., Respondent. DAIRY SYSTEMS COMPANY, INC., v. Respondent, Counterclaim Plaintiff, LAZE, LLC, a Wyoming limited liability company; DON ZEBE; and RICK LAWSON, Petitioners/ Counterclaim Defendants LAZE, LLC, a Wyoming limited liability company; DON ZEBE; and RICK LAWSON, BY CV- 2009 -89 -DC ~075 ORDER GRANTING PETITIONERS' MOTION FOR PARTIAL SUMMARY JUDGMENT RECEIVED 9/22/2010 at 1 0:32 AM RECEIVING 955635 BOOK: 754 PAGE: 75 JEANNE WAGNER LINCOLN COUNTY CLERK, KEMMERER, WY GAYLEN CLAYSON,MORRIS FARNELLA, Third Party Defendants. 2 O 76 ORDER GRANTING PETITIONERS' MOTION FOR PARTIAL SUMMARY JUDGMENT THIS MATTER came before the Court on the Petitioners Motion for Partial Summary Judgment Alleging the Lien Filed in this Matter is not Valid Under Wyoming Law filed on April 20, 2010, the Respondents' Memorandum in Opposition to Petitioners' Motion for Partial Summary Judgment Alleging the Lien Filed in the Matter is not Valid Under Wyoming Law filed on May 5, 2010, and the Petitioners' Response to Dairy Systems Opposition to Petitioner's Motion for Partial Summary Judgment Concerning the Lien Filed by Dairy Systems Company Inc. filed on May 17, 2010. The Court has reviewed the motions, briefs, and materials submitted in support of and in opposition to the motion. The Court grants the Petitioners motion for partial summary judgment. I. UNDISPUTED FACTS The admitted pleadings, affidavits, and exhibits submitted by the parties show that the following events occurred. x-077 Petitioner Laze LLC (Laze) is a Wyoming limited liability company that purchased the Star Valley Cheese Plant (Cheese Plant) in Thayne, Lincoln County, Wyoming on February 24, 2009. Zebe Aff. 3. Respondent Dairy Systems Company Inc. (Dairy Systems) manufactured and installed a Motor Control Center at the Cheese Factory. Clayson Aff. 19. Dairy Systems was not paid for this work. Respondents' Ex. F. On April 20, 2009, Dairy Systems timely filed a mechanic's lien against the Cheese Factory for work performed and materials supplied by Dairy Systems to the Cheese Factory. Petitioners' Ex. A. The lien statement filed by Dairy Systems contained the following language in the verification of the signature line: Petitioners' Exhibit A. 3 On this 20 day of April personally appeared before me Klark B. Gailey who acknowledged to me that he signed the same. II. THE PARTIES' CONTENTIONS Laze contends that the mechanic's lien filed by Dairy Systems does not comply with the requirements of Wyoming's mechanic's lien statutes. Because the lien does not comply with Wyoming statute, Laze contends that summary judgment is appropriate regarding the validity of Dairy Systems mechanic's lien. III. ISSUES Dairy Systems contends that since Laze did not raise this particular issue of statutory compliance with the mechanic's lien statutes when Laze filed its original Petition to Invalidate Lien Statement Pursuant to WS, 29- 1 -311, that the issue is waived, and cannot be raised now. Further, Dairy Systems contends that because so much time has elapsed since this issue should have been raised, that it should be allowed to amend its lien statement at this time to comply with the statute. I. Whether Dairy Systems Company, Inc. complied with the requirements of Wyoming's mechanic's lien statutes. II. Whether the Petitioners failure to raise the mechanic's lien defect in their pleadings, answers, and petition to invalidate the lien statement results in a waiver of the defects. IV. STANDARD OF REVIEW FOR SUMMARY JUDGMENT The motion for a summary adjudication is governed by Rule 56 (c), W.R.C.P., which states: The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. "Materiality of a fact depends upon it having some legal significance so that it establishes or refutes some essential element of a cause of action or defense asserted by one of the parties. In any given case, the materiality of 4 5 r- '079 any facts is limited by the pertinent legal standard[s] for the asserted claim and for the corresponding defenses to that claim." Braunstein v. Robinson Family Limited Partnership, 2010 WY 26,1 16, 226 P.3d 826, 833 (Wyo. 2010). "The material presented to the trial court as a basis for a summary judgment should be as carefully tailored and professionally correct as any evidence which is admissible to the court at the time of trial." Rivers v. Moore, Myers, Garland, LLC, 2010 WY 102, 8, 236 P.3d 284, 291 (Wyo. 2010) quoting Braunstein, 13,226 P.3d 832. The movant has the initial burden of establishing a prima facie case based on relevant and admissible evidence to show he is entitled to summary judgment. Mathisen v. Thunder Basin Coal Co., LLC, 2007 WY 161, 9, 169 P.3d 61, 64 (Wyo. 2007). [I]f the movant has made and supported its motion as required, an adverse party may not rest upon the mere allegations or denials of [its] pleadings, but that party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. However, the non moving party has no obligation to counter the motion with materials beyond the pleadings until the movant has made a prima facie showing that genuine issues of material fact do not exist. Rivers, 8, 236 P.3d at 290, quoting Braunstein, 15, 226 P.3d at 832 (internal quotation marks omitted). The record is reviewed "from the vantage point most favorable to the nonmoving party opposing the motion, giving that party the benefit of all 080 favorable inferences which may fairly be drawn from the materials." Rivers, 19, 236 P.3d at 290, quoting Braunstein, 16, 226 P.3d at 833. An entry of summary judgment is proper "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Franks v. Olson, 975 P.2d 588, 593 (Wyo. 1999) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986)). In addition, the parties in a summary judgment motion must comply with Rule 56.1, W.R.C.P., which states: Upon any motion for summary judgment pursuant to Rule 56 of the Rules of Civil Procedure, in addition to the materials supporting the motion, there shall be annexed to the motion a separate, short and concise statement of the material facts as to which the moving party contends there is no genuine issue to be tried. In addition to the materials opposing a motion for summary judgment, there shall be annexed a separate, short and concise statement of material facts as to which it is contended that there exists a genuine issue to be tried. Such statements shall include pinpoint citations to the specific portions of the record and materials relied upon in support of the parties' position. (Lexis 2010). V. DISCUSSION A. Whether Dairy Systems Company, Inc. complied with the requirements of Wyoming's mechanic's lien statutes? 6 7 Mechanic's liens in Wyoming are statutory creations and are strictly construed. E.g. Sheridan Commercial Park, Inc. v. Briggs, 848 P.2d 811, 815 (Wyo. 1993). The pertinent provision in the mechanic's lien statutes to this case is Wyo. Stat. Ann. 29- 1- 301(a). This provision states: 29 -1 -301 Lien statement to be filed; contents; notice; fee. (a) In order to have a perfected lien pursuant to this title, a lien claimant shall file with the county clerk a lien statement sworn to before a notarial officer. The county clerk shall file the statement and index by date, name of claimant and property owner, and legal description. 1 (Lexis 2009). Dairy Systems does not contest that the verification line on the lien statement failed to comply with the requirements of Wyo. Stat. Ann. 29-1 301(a). Instead, Dairy Systems relies on the argument that the defect has been waived. Laze contends that it is entitled to summary judgment based on the Wyoming Supreme Court's holding in Winter v. Pleasant, 2010 WY 4, 222 P.3d 828 (Wyo. 2010). In Winter, the Court held that a mechanic's lien was invalid because it did not fully comply with the requirements of Wyo. Stat. Ann. 29- 1- 301(a). The signature line of the lien statement at issue only contained language that identified the person signing the statement, not that the lien statement was sworn to for being accurate and correct. Id. at 14, 222 P.3d at 832. The Court explained the subtly in the difference: We find that for a lien statement to be valid, the plain language of the phrase "sworn to" in the lien statute requires that the lien affiant swear to the truth and accuracy of the lien statement... Given the fact that 32- 1- 105(b) requires that the notary public determine the identity of the affiant, it would make little sense to conclude that the affiant need only swear to his or her identity. Moreover, swearing to one's identity does nothing to assure the factual accuracy of the lien statement. Interpreting 29- 1- 301(a) in any way except to require that the accuracy and truth of the contents of the lien statement be "sworn to" would lead to an absurd result. Id. at 6, 222 P.3dat 833 (internal citations omitted). The Winter court overturned the district court's ruling that the verification statement, which did not swear to the truth or accuracy of the contents of the lien statement, met the requirements of 29- 1- 301(a). Id. at 7, 222 P.3d at 833. As in Winter, the lien statement verification line here does not contain language that it is "sworn to" for truth and accuracy. The signature line only contains an acknowledgement of who signed it and when. Because the verification does not comply with the statutory requirements of Wyo. Stat. Ann. 29- 1- 301(a), this lien statement was defective and partial summary judgment is granted for the Petitioners. 8 083 B. Whether the Petitioners failure to raise the mechanic's lien defect in their pleadings, answers, and petition to invalidate the lien statement results in a waiver of the defect? Even though the lien statement was defective, Dairy Systems contends that by failing to raise this issue in its complaint, answer, or original Petition to Invalidate Lien Pursuant to W.S. 29-1-311 Laze has waived the right to object to the defect in the lien statement. Dairy Systems contends that this is the approach taken by other states and although Wyoming has not addressed the issue, there is reason to believe Wyoming would follow the states that recognize waiver. Respondents' Memorandum, p. 6. Dairy Systems contends that other cases in Wyoming addressing similar issues have granted waivers to defects in affidavits. Finally, Dairy Systems contends that W.R.C.P. 12(g) prohibits Laze from raising the defect in the lien statement at this time. The rule reads: Rule 12: Defenses and objections; when and how presented; by pleading or motion; motion for judgment on pleadings. (g) Consolidation of defenses in motion, A party who makes a motion under this rule may join with it any other motions herein provided for and then available to the party. If a party makes a motion under this rule but omits therefrom any defense or objection then available to the party which this rule permits to be raised by motion, the party shall not thereafter make a motion based on the defense or objection so omitted, except a motion as provided in subdivision (h)(2) on any of the grounds there stated. (Lexis 2010). 9 2O84 Laze contends that raising an affirmative defense for the first time by motion for summary judgment, is proper and is not barred by this rule. Notwithstanding the arguments raised by the parties, the Court finds that a simpler solution to the issue exists. Defects in a lien statement are more than mere defenses to a claim. Compliance with the requirements of Wyo. Stat. Ann. 29 -1 -301 is a condition precedent for a district court to have jurisdiction over a mechanic's lien. See Robbins v. South Cheyenne Water and Sewage District, 792 P.2d 1380, 1384 (Wyo. 1990). A challenge to the district court's jurisdiction to hear a mechanic's lien can be raised at any time, including on appeal: It is a fundamental proposition that, if a claim does not exist because the party attempting to invoke the lien statutes has not complied with the statutory requirements, there is no matter over which the district court may exercise jurisdiction. This court has the inherent power, and the duty, to address jurisdictional defects on appeal even though they have not been called to our attention by a litigant. In this instance, [appellant], at least by implication, called that matter to our attention. We are compelled to reverse the judgment of the district court... Id. (internal citations omitted). Subject matter jurisdiction cannot be waived by either party and it may be challenged at any time during a proceeding. Id. See also Cotton v. Brow, 903 P.2d 530, 531 (Wyo. 1995) (defendant could waive personal jurisdiction but not subject matter jurisdiction); Brunsvo /d v. State, 864 P.2d 10 n'n', 34, 36 (Wyo. 1993) (party could challenge the subject matter jurisdiction of administrative agency at any time); Weller v. Weller, 960 P.2d 493, 496 (Wyo. 1998) (lack of subject matter jurisdiction is a fundamental defect that cannot be cured or waived). As is stated above, Dairy Systems does not contest that the verification was defective. It does cite Bradbury v. Adeleke, 2008 WL 5048427 (Del.Super., November 25, 2008), American Property Maintenance v. Monia, 59 S.W.3d 640 (Mo.App. E.D. 2001), and Board of Directors of Hunt Club at Coram Homeowners Ass'n, Inc. v. Hebb, 868 N.Y.S.2d 856 (N.Y.Sup. 2008) to the effect that failure to timely challenge a defective verification statement waives the defect in the lien. However, these cases are based on those states particular statutes and do not supersede clear Wyoming authority to the contrary. Dairy Systems also cites Ramsay Motor Co. v. Wilson, 47 Wyo. 54, 30 P.2d 482 (Wyo. 1934) and White v. Diamond Intern. Corp,, 665 P.2d 463 (Wyo. 1983). Both cases are distinguished from the current issue. Ramsay addressed a writ of attachment, not a lien statement. The issue was not whether the contents of the affidavit were sworn to, but that they were sworn to the parties' attorney, who was barred by statute from serving as a notary for his client. Ramsay, 30 P.2d at 486. The Ramsay court held that such affidavits were voidable, but were not void. Id. The contents of 11 the affidavit, and that it was sworn to, were not at issue. The present defect does not involve the identity of the notary, but rather what was sworn to in the affidavit. White addressed Wyo. Stat. Ann. 29-2-114 (1977 repealed). 29 -2- 114 directed that certain defects in lien statements should be disregarded under certain conditions. White, 665 P.2d at 469. The statute was repealed by the amendments to the mechanic's lien statutes in 1981. The Court "must assume that the legislature did not intend futile acts and that its amendment of the statute indicated some change in the existing law was intended." Wetering v. Eisele, 682 P.2d 1055, 1061 (Wyo. 1984). No current provision addresses whether defective lien statements should be disregarded. The current mechanic's lien statutes require strict compliance. See Winters, at 6,222 P.3d at 833. The defect in the verification statement is a fatal flaw that denies the Court of jurisdiction. By seeking a waiver on the verification defect in the lien statement, Dairy Systems is asking the Court to do something that it does not have the jurisdiction to do. The Court notes that both attorneys in this case have expended significant effort and devoted ample space in their motions to make allegations, accusations, and requests for sanctions against each other, none of which were germane to the issue before the Court. The Court will not 12 08 address these matters at this time, other than to strongly suggest they read the Model Code of Pretrial Conduct cited in the scheduling order, particularly 3(b) and 4(a), (b),and (e). CONCLUSION For the reasons stated above, the Court grants the Petitioners' motion for partial summary judgment. Dairy Systems still has a claim based on breach of contract and unjust enrichment. DATED this 3 day of September, 2 NNIS L. SA DER ON DiglkifttcPWMANdg ss. COUNTY OF LINCOLN I, Kenneth D. Roberts, Clerk of the Third Judicial District Court within and foresaid county and in the State of foresaid, do hereby certify the foregoing to be a full, true, and com•lete cop 13 Morris A. Farinella Masson Cheese comp 6180 Alcoa Avenue Vernon, CA 90058 Rick Lawson 431 Chesapeake Avenue Pocatello, Id 83202 Don Zebe 465 Berrett Avenue Pocatello, Id 83201 Gaylen Clayson 710 East 600 North Firth Id 83236 :J, 1. Lien Statement Dairy Systems Company, 4004 North Highway 91, Hyde Park, Utah 84318, files this Lien Statement: 1. The name and address of the person seeking to enforce the lien: Dairy Systems Company, 4004 North Highway 91, Hyde Park, Utah 84318 2. The amount daimed to be due and owing: $220,836.12. 3. The name and address of the person against whose property the lien claim is filed: laze, �C. 431 Chesapeake. Pocatello, Idaho 83202 4. An itemized list setting forth and describing materials delivered or work performed is attached hereto as exhibit A. 5. The name and address of the persons against whom the lien daim is made is as follows: 6. The date when labor was last performed or services were last rendered: December 23, 2008. 7. The legal description of the premises is attached hereto as exhibit B. 8. The contract between the parties was oral, there was no written contract. Dated this 30day of April, 2009 Dairy Systems Company, Inc. By: Ki6JA, Its: V i e.e rcS, On this .2° day of April personally appeared before meil 4 Yk !3. G G• rho acknowledged to me that he signed the same. DS000068 1) //a�q Recorded at ¢IN In Book�� Page.. lit, Kemmerer, WY No. 9�� Jeanne Wagner, Clerk tary Pu ::0