Reeve & Associates, Inc. v. Tanner

2015 UT App 166, 355 P.3d 232, 790 Utah Adv. Rep. 31, 2015 Utah App. LEXIS 175, 2015 WL 4031770
CourtCourt of Appeals of Utah
DecidedJuly 2, 2015
Docket20130530-CA
StatusPublished
Cited by6 cases

This text of 2015 UT App 166 (Reeve & Associates, Inc. v. Tanner) is published on Counsel Stack Legal Research, covering Court of Appeals of Utah primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Reeve & Associates, Inc. v. Tanner, 2015 UT App 166, 355 P.3d 232, 790 Utah Adv. Rep. 31, 2015 Utah App. LEXIS 175, 2015 WL 4031770 (Utah Ct. App. 2015).

Opinion

Opinion

PEARCE, Judge:

1 The owners of real property contracted to sell their land to a developer with a plan to create a residential subdivision. The developer retained a third-party contractor to undertake the tasks necessary for the project to receive county approval. While the contractor was completing its work, the developer's financiers got cold feet. The developer then sought a reduction in the price of the land to appease them. During this time, the developer failed to pay the contractor, but the contractor continued working on the project, in apparent hope that the landowners and developer would reach an agreement. The financiers eventually backed out, the land sale fell through, and the project ground to a halt. The contractor then filed two mechanics' liens on the real property, seeking payment from the landowners for the completed work. After a bench trial, the district court ruled (1) that the liens were invalid because the contractor had worked only for the developer, who was not an agent of the landowners, and (2) that the contractor's unjust-enrichment claim failed because the contractor had not shown the value of the benefit conferred. The district court also denied the landowners' claim for attorney fees after determining that, while the liens were invalid, they were neither brought in bad faith nor abusive.

12 Despite largely prevailing at trial, the landowners appeal. They contend that they defeated the lien and were therefore statutorily entitled to an award of attorney fees. They also contend that the unjust-enrichment claim should have failed on more grounds than those the district court found. The contractor cross-appeals, arguing that the liens were valid because the landowners consented to or authorized the work the contractor performed. We reverse in part and affirm in part and remand the case to the district court to calculate and award attorney fees.

BACKGROUND

1 3 Helen and Ralph Hansen (Landowners) own parcels of land in Weber County via a revocable trust. 1 In 2006, a real estate developer (Developer) approached Landowners with a proposal to buy the land and turn it into a residential subdivision. In 2007, Landowners and Developer entered into a real estate purchase contract (the REPC). As part of that deal, Landowners would keep three lots in the subdivision for themselves. Shortly thereafter, Developer sought bids from contractors to test the soil, plan the subdivision, and obtain the proper permitting from the county. After selecting a bid from Reeve & Associates, Inc. (Contractor) to perform this work, Developer gave Contractor a $4,000 retainer.

T4 By September 2007, Contractor was working on the project. That month, Landowners met with Contractor to discuss the test holes that needed to be dug. Landowners and Contractor also discussed several of Landowners' requests for the lots they would keep. In October, Weber County approved the preliminary plans for the subdivision. Throughout the winter, Contractor continued *236 the preparatory work and permitting processes.

{ 5 The deadline for closing the transaction expired on March 10, 2008. In May 2008, Landowners and Developer agreed to extend the REPC closing deadline to June 18, 2008. This deadline also expired without the deal closing.

T6 Throughout this time, Contractor continued working on the project and sent monthly invoices to Developer, all of which went unpaid. In February 2009, Contractor submitted plat revisions and construction plans to Weber County for final approval. By May 2009, after Developer failed to meet certain bond requirements, Contractor realized the project was dead. In June 2009, Weber County informed Landowners that the plat-approval recommendation had expired and that, if the project were to proceed, a new application process would have to begin essentially from seratch.

17 Contractor filed two mechanies' liens on the property, totaling $71,105.97 plus interest and fees. 2 Contractor filed a complaint, seeking to foreclose on those liens and asserting an unjust-enrichment claim. The complaint sought the same amount, but at trial, Contractor stated that the correct amount owed was $59,891.88 plus interest and fees. Contractor attempted to explain this discrepancy by noting that it had not originally applied the $4,000 retainer to the amount owed. As the district court noted, "How application of the $4,000 retainer fee resulted in a reduction of approximately $11,000 is unclear."

T8 The district court held a bench trial on the and unjust-enrichment claims. The court found that Developer had not acted as Landowners' agent in his dealings with Contractor and that, as a result, Contractor had performed work only for Developer. The court concluded that the me-chanies' liens claim therefore failed. The court also denied Landowners' request for attorney fees. With respect to the unjust-enrichment claim, the court found that Contractor had conferred a benefit on Landowners and that Landowners had inequitably retained that benefit. However, because there was no reliable testimony of the amount of the benefit conferred, the court was "unable to award the damages requested." After the decision was issued, Landowners filed a motion asking the court to amend the judgment, seeking an award of attorney fees. The district court denied that motion.

ISSUES

{9 First, Landowners contend that the district court erred in denying their request for an award of attorney fees, because the relevant statute mandated such an award. Second, Landowners contend that the district court erred by finding that the filing of the mechanies' liens was not abusive.

T10 Third, Landowners contend that the district court erred by finding that Contractor had conferred a benefit on them and that they inequitably retained it. Fourth, Landowners contend that the district court erred by failing to find that the mechanics' liens were untimely filed. Fifth, Landowners contend that the district court's "findings of fact on several material issues are against the weight of the evidence, clearly erroneous, and must be corrected."

{11 Contractor cross-appeals, contending that the district court erred in determining that the mechanics' liens statute required Developer to be Landowners' agent in order for Contractor to lien Landowners' property.

ANALYSIS

I. The Attorney Fee Statute

112 Landowners contend that the district court applied the wrong standard for determining whether they were entitled to an award of attorney fees. They assert that under the correct standard, an award was mandatory.

T 13 Utah Code section 38-1-18 (the Attorney Fee Statute) provided that, subject to *237 two restrictions not pertinent here, "in any action brought to enforce any lien under [the mechanies' liens] chapter the successful party shall be entitled to recover a reasonable attorneys' fee." Utah Code Ann. § 88-1-18(1) (LexisNexis 2010) (emphasis added). 3

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Cite This Page — Counsel Stack

Bluebook (online)
2015 UT App 166, 355 P.3d 232, 790 Utah Adv. Rep. 31, 2015 Utah App. LEXIS 175, 2015 WL 4031770, Counsel Stack Legal Research, https://law.counselstack.com/opinion/reeve-associates-inc-v-tanner-utahctapp-2015.