Custom Construction Solutions, LLC, and Cannon Design, Inc., Plaintiffs/Respondents v. B&P Construction, Inc., and HH St. Louis Railway L.P., and Gamma Real Estate Capital, LLC, and Geotechnology, Inc., Trustees Services, Inc., and Concrete Strategies, LLC, Defendants/Respondents.

CourtMissouri Court of Appeals
DecidedNovember 28, 2023
DocketED111253
StatusPublished

This text of Custom Construction Solutions, LLC, and Cannon Design, Inc., Plaintiffs/Respondents v. B&P Construction, Inc., and HH St. Louis Railway L.P., and Gamma Real Estate Capital, LLC, and Geotechnology, Inc., Trustees Services, Inc., and Concrete Strategies, LLC, Defendants/Respondents. (Custom Construction Solutions, LLC, and Cannon Design, Inc., Plaintiffs/Respondents v. B&P Construction, Inc., and HH St. Louis Railway L.P., and Gamma Real Estate Capital, LLC, and Geotechnology, Inc., Trustees Services, Inc., and Concrete Strategies, LLC, Defendants/Respondents.) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Custom Construction Solutions, LLC, and Cannon Design, Inc., Plaintiffs/Respondents v. B&P Construction, Inc., and HH St. Louis Railway L.P., and Gamma Real Estate Capital, LLC, and Geotechnology, Inc., Trustees Services, Inc., and Concrete Strategies, LLC, Defendants/Respondents., (Mo. Ct. App. 2023).

Opinion

In the Missouri Court of Appeals Eastern District DIVISION ONE

CUSTOM CONSTRUCTION ) No. ED111253 SOLUTIONS, LLC, and CANNON ) DESIGN, INC., ) ) Plaintiffs/ Respondents, ) Appeal from the Circuit Court ) of the City of St. Louis v. ) Cause No. 1822-CC11468 ) B & P CONSTRUCTION, INC., et al. ) Honorable Christopher E. McGraugh ) Defendants, ) ) and ) ) HH ST. LOUIS RAILWAY L.P., and ) GAMMA REAL ESTATE CAPITAL, ) LLC, ) ) Defendants/Appellants ) ) and ) ) GEOTECHNOLOGY, INC., TRUSTEES ) SERVICES, INC., and CONCRETE ) STRATEGIES, LLC, ) ) Defendants/ Respondents. ) Filed: November 28, 2023

Introduction

Following a bench trial, the trial court found the mechanic’s liens filed by Custom

Construction Solutions, LLC (“Custom Construction”); Cannon Design, Inc. (“Cannon”), and Concrete Strategies, LLC (“Concrete Strategies”) (collectively, “lien claimants”) had priority over

the deed of trust filed by Gamma Real Estate Capital, LLC (“Gamma”) for a project involving the

Railway Exchange Building and parking garage in downtown St. Louis. On appeal, Gamma raises

four points. Gamma argues the trial court erred in finding the mechanic’s liens had priority over

the deed of trust, in finding Gamma waived the priority of its deed of trust, in finding the

mechanic’s liens were valid, and in admitting Cannon’s letter of registration after the trial.

In a consolidated action, the trial court also found HH St. Louis Railway, LP (“HH St.

Louis”) breached its contracts with Custom Construction, Cannon, Concrete Strategies, and

Geotechnology, Inc. (“Geotechnology”) by failing to pay them. HH St. Louis raises six points on

appeal. HH St. Louis argues the trial court erred in finding it breached the contracts, in finding

Concrete Strategies was unjustly enriched, in finding the mechanics liens were valid, in admitting

Geotechnology’s and Cannon’s letters of registration after the trial, and in awarding attorneys’

fees.

We affirm in part and reverse in part the judgment of the trial court.

Factual and Procedural Background

Facts

In January 2017, HH St. Louis purchased the Railway Exchange Building, the parking

garage, and the surface parking lot to redevelop them into retail, office, and residential space. The

total purchase price was approximately $29.7 million. Gamma, HH St. Louis’s financial lender,

lent HH St. Louis $19.7 million. At the time of closing, HH St. Louis executed a deed of trust in

favor of Gamma as a security interest in the loan. Gamma recorded the deed of trust on February

14, 2017.

2 Gamma placed a portion of the loan proceeds into a predevelopment reserve fund. This

fund contained $5 million. HH St. Louis used this fund to complete predevelopment work, which

included remediation and demolition. To access the funds, HH St. Louis submitted draw requests

to Gamma, which required HH St. Louis to provide all bills, invoices, and receipts. The draw

requests referred to the loan agreement as a “construction loan agreement.” As part of the draw

requests, HH St. Louis “agree[d] to provide, if requested by [Gamma], a vendor payee listing

showing the name and amount currently due each party to whom [HH St. Louis] is obligated for

labor, material, and/or services supplies.” Gamma approved some draw requests and rejected

others.

HH St. Louis retained Concrete Strategies to provide all necessary materials, labor, and

construction for mitigation repairs to strengthen the Railway Exchange Building and garage.

Specifically, this required various repairs and installation of temporary shoring to keep the building

in an operating manner. Concrete Strategies began work on the project, but to take advantage of

tax incentives, it brought in B&P Construction, a minority-owned contractor. B&P Construction

took over as the general contractor, and Concrete Strategies became a subcontractor. Concrete

Strategies performed shoring work on the garage until May 8, 2018. After HH St. Louis and B&P

Construction failed to pay invoices submitted by Concrete Strategies, Concrete Strategies filed a

lien against the garage in the amount of $378,041.35.

In addition to Concrete Strategies’s work on the garage, HH St. Louis, through its

authorized representative, S.M.,1 asked Concrete Strategies to provide labor and equipment for

selective demolition on the Railway Exchange Building. Concrete Strategies performed the

1 The personal identifying information of witnesses has been omitted pursuant to RSMo § 509.520 (Supp. 2023). 3 selective demolition at a rate of $1,900 per day and submitted the invoices to HH St. Louis. HH

St. Louis failed to pay Concrete Strategies for its work on the Railway Exchange Building.

Concrete Strategies therefore filed a lien against the Railway Exchange Building in the amount of

$155,000.

In November 2017, HH St. Louis and Cannon entered into a contract for Cannon to provide

architecture and engineering services for the redevelopment of the Railway Exchange Building.

Under the contract, HH St. Louis was required to pay Cannon $3.65 million. Cannon began work

on the project and completed the first two stages of the architectural and engineering process. This

included producing multiple schematic designs for HH St. Louis. Cannon’s work continued until

June 28, 2018. Up to that point, some of Cannon’s invoices went unpaid. After unsuccessfully

attempting to resolve the nonpayment, Cannon filed a lien on the Railway Exchange Building on

August 24, 2018, in the amount of $1,758,585.

Concrete Strategies hired Custom Construction on May 1, 2017 to provide materials to

assist in supporting the garage while it was being repaired. After B&P Construction became the

general contractor, Custom Construction began sending its invoices to B&P Construction. Some

of the invoices were paid, but others were not. Due to the unpaid invoices, Custom Construction

filed a lien against the Railway Exchange Building, garage, and surface parking lot in the amount

of $47,186.22.

B&P Construction joined the Railway Exchange Building project in June 2017. Soon after,

B&P Construction entered into a contract with HH St. Louis. B&P Construction began work on

the Railway Exchange project in November 2017. Its main roles were cleaning up the garage and

serving in an administrative role as the general contractor. In the administrative role, B&P

Construction received and sent invoices from the subcontractors to HH St. Louis for payment. It

4 sent these invoices to S.M., an authorized representative of HH St. Louis. HH St. Louis would

send the funds to B&P Construction, which in turn would disburse the funds to the subcontractors.

Eventually, some of Concrete Strategies’s invoices went unpaid because HH St. Louis failed to

pay B&P Construction and B&P Construction failed to pay Concrete Strategies. Because HH St.

Louis failed to pay B&P Construction for four pay applications from Concrete Strategies, B&P

Construction filed a cross-claim against HH St. Louis to recover damages for the amounts of the

pay applications.

In December 2017, HH St. Louis retained Geotechnology to perform engineering work on

the Railway Exchange Building. Specifically, Geotechnology would perform materials testing to

provide data and analysis for the existing structure of the Railway Exchange Building.

Geotechnology performed its work and submitted invoices to HH St. Louis for $45,066.13. HH

St. Louis failed to pay the invoices.

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Custom Construction Solutions, LLC, and Cannon Design, Inc., Plaintiffs/Respondents v. B&P Construction, Inc., and HH St. Louis Railway L.P., and Gamma Real Estate Capital, LLC, and Geotechnology, Inc., Trustees Services, Inc., and Concrete Strategies, LLC, Defendants/Respondents., Counsel Stack Legal Research, https://law.counselstack.com/opinion/custom-construction-solutions-llc-and-cannon-design-inc-moctapp-2023.