National Lumber Co. v. LeFrancois Construction Corp.

2002 Mass. App. Div. 228, 2002 Mass. App. Div. LEXIS 91
CourtMassachusetts District Court, Appellate Division
DecidedDecember 31, 2002
StatusPublished

This text of 2002 Mass. App. Div. 228 (National Lumber Co. v. LeFrancois Construction Corp.) is published on Counsel Stack Legal Research, covering Massachusetts District Court, Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
National Lumber Co. v. LeFrancois Construction Corp., 2002 Mass. App. Div. 228, 2002 Mass. App. Div. LEXIS 91 (Mass. Ct. App. 2002).

Opinion

Rutberg, J.

In this case of first impression, we are asked to determine whether the sum secured by a valid mechanic’s lien includes contracted for attorneys’ fees1 and interest earned on the secured sum during the pendency of the underlying litigation. In view of the long and arduous path of this litigation, the issue presented is of more than academic interest to the parties.

This matter began in 1995 when LeFrancois Construction Corp. [hereinafter “LeFrancois”] contracted with National Lumber Company [hereinafter “National Lumber”] for construction materials to be used by LeFrancois for construction of a residence to be built on property it controlled.2 To secure its receivable, National Lumber recorded the appropriate notice to begin the process of obtaining a mechanic’s lien on the properly pursuant to G.L.c. 254, §4.3 As required, the notice set forth a completion date — December 1, 1995; and within the statutory time National Lumber filed a further statement [hereinafter “§8 statement”] in the Registry of Deeds indicating that a balance of $26,103.98 remained unpaid. G.L.c. 254, §8. It was later discovered that LeFrancois had conveyed the property to Dean and Stephanie Schwartz [hereinafter “Schwartzes”] four days before the §8 statement [229]*229was recorded. After LeFrancois defaulted on its obligations to National Lumber, it tried to enforce its lien on the property; however, the Schwartzes contested claiming the mechanic’s lien was not enforceable against their recently purchased property. The Schwartzes’ claim led to earlier litigation that culminated in the Supreme Judicial Court, who determined that the lien was enforceable against the Schwartzes’ property. National Lumber Company v. LeFrancois Construction Corp., 430 Mass. 663 (2000).

Thereafter, the Schwartzes dissolved the lien by recording a bond pursuant to G.L.c. 254, §12. On April 6,2001, the Schwartzes obtained a bond issued by United Casualty and Surety Company [hereinafter “United”] in the penal sum equal to the amount claimed unpaid in the §8 statement. Two weeks later, National Lumber filed a second action in the district court to enforce this bond. As part of this second action, National Lumber moved the district court to either strike the bond as insufficient or compel the Schwartzes and/or their bonding company to increase its penal sum of the bond to cover National Lumber’s service charges and attorneys’ fees. After the trial court denied National Lumber’s motion, it filed this appeal.4 Apparently for the first time on the record, National Lumber claims in its brief that it should be entitled to statutory interest in the least.5

A mechanic’s lien is “strictly a statutory creation,” and a subcontractor’s lien is established by G.L.C. 254, §4 which states that a lien created thereunder shall"... secure the payment of all labor and material, which [the subcontractor]... is to furnish or has furnished, upon the building or structure... [to be constructed].” East Coast Steel Erectors, Inc. v. Ciolfi, 417 Mass. 602, 605 (1994). The statute goes on to state that “... such fien shall in no event exceed the amount due or to become due under the original contract...”; and, National Lumber argues that this latter language expresses the legislature’s intent to expand the lien to include other charges which may become due to it under the contract G.L.c. 254, §4.

“General Laws c. 254 sets out in careful detail the steps required to create, maintain, and enforce a mechanic’s lien on real estate....” National Lumber Company v. LeFrancois Construction Corp., supra at 668. Sections two and four provide for the creation of liens by recording a notice in the registry of deeds which must include a date by which the particular contract is to be completed. Section 4 allows a subcontractor to obtain a lien against the landowner with whom he may not have privity by recording a notice of a written contract in the registry of deeds in which the affected property is located, as was done in this case. After creating a lien, the lienor must then record its §8 statement containing the amount claimed due subject to “all just credits,” and this statement must be filed within thirty days following the completion date previously set forth in the notice of lien. Section 11 of the statute goes on to require that the claimant file a civil action within sixty days after fifing the §8 statement, and failure to file such an action in a timely manner results in the dissolution of the lien. Parenthetically, section 5 requires that an attested copy of the complaint be recorded. Section 14 then allows a person with an interest in the affected property to dissolve any such lien upon fifing of a bond with sure[230]*230ties in a penal sum equal to the amount of the lien. When read together these sections create a smoothly operating procedure that allows for the creation, maintenance and dissolution of a nonconsensual, extrajudicial security for contractors and materialmen; moreover, this procedure embodies the essence of the land recording system by placing third parties on notice of such claims. National Lumber Co. v. Fort Realty Corp., 1999 Mass. App. Div. 235; HPT Advisors, Inc. v. MacDonald, Levine, Jenkins & Co., P.C., 43 Mass. App. Ct. 613 (1997).

As stated above, there are no Massachusetts appellate decisions directly on point; however, a superior court judge has determined that

Nothing in the statute limits the claimant’s claim to only the principal amount for labor and materials. A demand for interest could comprise part of ‘the claim’ for labor and materials. Fraser Engineering Co., Inc. v. Franchi Group Associates (Middlesex Superior Court No. 956651, Hamlin, J.)

Conversely, the Southern District of this Court implied just the opposite in a dictum in the case of National Lumber Co. v. M.G. Murphy Construction Co., Inc., 1996 Mass. App. Div. 35.

The applicable statute is susceptible to contrary readings. Section 4 which creates the subcontractor’s lien states that the lien is “... to secure the payment of all labor and material.... [emphasis supplied]” which militates toward the limitation of the lien as Schwartzes contend. However, the very next sentence in this section adds that “... such lien shall in no event exceed the amount due or to become due under the original contract.... [emphasis supplied]” which appears to be a more expansive statement Section 8 can be read either way as it requires the filing of a statement by the contractor setting forth “... a just and true account of the amount due him, with all just credits....” In this case the §8 statement simply states: “The amount due is as follows: $26,103.98” which sum includes the small amount of service accrued as of the date of its filing eighteen days after the stated date for the completion of the underlying contract The fact that the amount claimed due includes service charges is not noted on the §8 statement and this omission could mislead a third party relying on it yet as noted above, the inclusion of claimed interest and attorney fees seemed inappropriate to the court in the M. G. Murphy case. Id.

The statutory scheme for dissolution also contains contrary language. G.L.c. 254, §14. The statute predicates dissolution on the posting of a bond with "...

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Related

East Coast Steel Erectors, Inc. v. Ciolfi
632 N.E.2d 397 (Massachusetts Supreme Judicial Court, 1994)
Mullen Lumber Co. v. Lore
537 N.E.2d 123 (Massachusetts Supreme Judicial Court, 1989)
Hartford Accident & Indemnity Co. v. Casassa
16 N.E.2d 860 (Massachusetts Supreme Judicial Court, 1938)
National Lumber Co. v. LeFrancois Construction Corp.
723 N.E.2d 10 (Massachusetts Supreme Judicial Court, 2000)
HRPT Advisors, Inc. v. MacDonald, Levine, Jenkins & Co.
686 N.E.2d 203 (Massachusetts Appeals Court, 1997)
National Lumber Co. v. Fort Realty Corp.
1999 Mass. App. Div. 235 (Mass. Dist. Ct., App. Div., 1999)
National Lumber Co. v. M.G. Murphy Construction Co.
1996 Mass. App. Div. 35 (Mass. Dist. Ct., App. Div., 1996)

Cite This Page — Counsel Stack

Bluebook (online)
2002 Mass. App. Div. 228, 2002 Mass. App. Div. LEXIS 91, Counsel Stack Legal Research, https://law.counselstack.com/opinion/national-lumber-co-v-lefrancois-construction-corp-massdistctapp-2002.