Rockingham Electrical Supply Company, Inc. v. Wright-Ryan Construction, Inc.

• Court: Superior Court of Maine
• Decided: February 14, 2017
• Docket: LINcv-15-36
• Status: Unpublished

Opinion

STATE OF MAINE SUPERIOR COURT LINCOLN, ss. CIVIL ACTION DOCKET NO. CV-15-36

) ROCKINGHAM ELECTRICAL SUPPLY ) COMPANY, INC., ) ) ORDER ON Plaintiff ) DEFENDANT'S MOTION FOR ) SUMMARY JUDGMENT V. ) AND FOR SANCTIONS ) WRIGHT-RYAN CONSTRUCTION, INC., ) ) Defendant ) )

Defendant Wright-Ryan Construction, Inc. ("Wright-Ryan") moves for summary

judgment on the sole count of the amended complaint made by Plaintiff Rockingham

Electrical Supply Company, Inc. ("Rockingham") to enforce a mechanic's lien. See 10

M.R.S. § 3251, et seq. (2015); M.R. Civ. P. 56. Also before the Court is Wright-Ryan's

motion for sanctions against Rockingham. See M.R. _Civ. P. 11. For the following reasons,

Wright-Ryan's motion for summary judgment is denied, Rockingham's amended

complaint is dismissed with prejudice, and the Court will consider furth~r arguments

on possible sanctions.

I. Factual and Procedural Background

Wright-Ryan was the general contractor under a contract with the Trustees of

Lincoln Academy (the "Owner") to complete work at the Owner's property in

Newcastle, Maine (the "Property"). (Def.'s S.M.F. err 1.) Wright-Ryan entered into a

subcontract with TRT Electric, Inc. ("TRT") to complete work and improvements at the

Property. (Id. err 2.) Rockingham claims that, pursuant to a contract, it provided TRT goods and

materials that were related to improvements at the Property. (Id.

claims that TRT owes it $43,308.59 for those goods and materials. (Id.

did not have a contract with either Wright-Ryan or the Owner. (Id.

On or about August 10, 2015, Rockingham filed a "CERTIFICATE OF

MECHANIC'S LIEN and STATEMENT OF LIEN CLAIM" (the "Lien Certificate") with

the Lincoln County Registry of Deeds. (Id.

recorded by Rockingham against the Property. (Id.

body of the Lien Certificate reads as follows:

IN WITNESS WHEREOF, Rockingham Electrical Supply Company, Inc. has caused its name to be hereunto affixed and this Certificate to be signed and sworn this 3rd day of August, 2015.

(Pl.'s Opp. S.M.F.

Certificate reads as follows:

Personally appeared, Karen Lane, duly authorized, known to me, or satisfactorily proven to be the person whose name is subscribed to the foregoing instrument, and acknowledged thats/ he exec11ted the same for pu rposes therein contained in his/her capacity as Credit Manager of the Company.

(Id. (qualified on other grounds).)

On August 13, 2015, counsel for Wright-Ryan emailed counsel for Rockingham

"seeking to negotiate the voluntary bonding off of Rockingham's lien." (Def.'s S.M.F.

15.) In the body of the email, counsel for Wright-Ryan wrote, "Please let me know

Rockingham Electric' s position regarding this request and, if they are amendable to the

agreement, if you have any changes to it." (Def.'s Opp. to Pl.'s S. Add'l M.F.

Counsel for Wright-Ryan attached to the email (1) a proposed agreement entitled

"Agreement to Discharge of Lien by Bond as Substitute Security" with signature lines

2 for both Wright-Ryan and Rockingham, (2) a "Discharge of Lien" with a signature line

for Rockingham, and (3) a copy of the fully executed "Release of Lien Bond" that

Wright-Ryan proposed to deliver to Rockingham if an agreement was reached. (Def.'s

S.M.F. <[ 16.)

Rockingham asserts that it accepted Wright-Ryan's August 13 offer on

September 18, 2015, when counsel for Rockingham executed the proposed agreement

and lien discharge and returned the two documents to counsel for Wright-Ryan. (Pl.'s S.

Add'l M.F. <[ 39 (denied).) Wright-Ryan asserts that Rockingham did not accept Wright­

Ryan's offer, but rather "offered a new draft agreement ... as a counteroffer."(Def.'s

S.M.F. <[<[ 18, 19 (both denied).) However, Wright-Ryan effectively admits that the "new

draft agreement" is identical to the proposed agreement attached to the August 13

email. (Pl.'s S. Add'l M.F.

also asserts that the August 13 email to which Rockingham allegedly replied with a

counteroffer was not an offer at all, "but at best a solicitation for an offer." (Def.'s Opp.

to Pl.'s S. Add'l M.F.

On October 1, 2015, Wright-Ryan proposed a modification to the proposed

agreement that Rockingham had executed. (Def.'s S.M.F.

proposed modification. (Id. <[ 25.) Wright-Ryan has not counter-executed the proposed

agreement, and the Lien Certificate has not been discharged or vacated. (Id. <[

In addition, no party has petitioned the Court under 10 M.R.S.A. § 3263 to release the

lien on the Property or to accept a bond as alternate security for the lien on the

Property. (Id. <[

Rockingham brought its initial complaint to enforce the lien, dated September 18,

2015, against TRT, TRT's president, and Wright-Ryan. By order dated April 11, 2016, the

Court ordered Rockingham to file within ten days an amended complaint "stating

3 specifically in each count the relief sought, what party or parties the relief is sought

against, and the factual basis for such claims." On April 21, 2016, Rockingham filed the

amended complaint against Wright-Ryan.

II. Motion for Summary Tudgment.

Wright-Ryan moves for summary judgment on the sole count of the amended

complaint.

a. Standard of Review.

Summary judgment is appropriate if, based on the parties' statements of material

facts and the cited record, there is no genuine issue of material fact and the moving

party is entitled to judgment as a matter of law. M.R. Civ. P. 56(c); Dyer v. Dep't of

Transp., 2008 ME 106, 'i[ 14, 951 A.2d 821. "A material fact is one that can affect the

outcome of the case. A genuine issue of material fact exists when the fact finder must

choose between competing versions of the truth." Id. (citations omitted). When deciding

a motion for summary judgment, the court reviews the evidence in the light most

favorable to the non-moving party. Id.

However, the Court cannot reach the merits of a matter if it has no jurisdiction

over the subject matter at issue. Tomer v. Me. Human Rights Comm 'n, 2008 ME 190, 'iI 15,

962 A.2d 335. Although Wright-Ryan does not move to dismiss for lack of subject

matter jurisdiction, the court must dismiss an action if it appears that the court has no

jurisdiction over the subject matter at issue therein. M.R. Civ. P. 12(h)(3). See also-Jensen

v. Jensen, 2015 ME 105, 'i[ 11, 121 A.3d 809 (quoting Foley v. Ziegler, 2005 ME 117, 'iI 8, 887

A.2d 36) ("the issue of a court's authority may be raised sua sponte at any point.").

4 b. Discussion.

Wright-Ryan argues that the Lien Certificate is invalid because it does not

contain a proper jurat. 1 (Def.'s Mot. Summ. J. 8 (citing Pineland Lumber Co. v. Robinson,

382 A.2d 33, 38 (Me. 1978)).) Rockingham admits that the Lien Certificate contains only

an acknowledgement by the notary public, not a jurat, but argues that the Lien

Certificate is sufficient nonetheless. (Def.'s S.M.F.

Under Maine statutory law, a claimant who furnishes materials used for the

improvement of a building has a lien on the building property to secure payment for

such materials, provided that the materials were furnished pursuant to a contract with

the property owner or with the property owner's consent. 10 M.R.S. § 3251. However,

that lien is dissolved unless the claimant properly files a lien statement within 90 days

after furnishing the materials. 10 M.R.S. § 3253(l)(A). The lien statement "must be

subscribed and sworn to by the person claiming the lien, or by someone on the

claimant's behalf." Id. (emphasis added).

The court generally interprets the mechanic's liens statutes liberally to effechiate

the dual purpose of affording security to claimants and providing notice to owners and

purchasers. HCI Corp. v. Voikos Constr. Co., 581 A.2d 795, 798 (Me. 1990). However, this

liberal statutory construction only applies when no express stah1tory command has

been disobeyed (i.e. when the claimant is within the statute). Island Terrace Condo.

Owners Ass'n v. Coastal Constr. & Landscaping, Inc., No. RE-02-090, 2005 Me. Super LEXIS

18, at *5-6 (Jan. 10, 2005) (citing Pineland Lumber Co. v. Robinson, 382 A.2d 33, 36 (Me.

1978); Twin Island Dev. Corp. v. Winchester, 512 A.2d 319, 323 (Me. 1986); Combustion

Eng 'g v. Miller Hydro Group, 577 A.2d 1186, 1188 (Me. 1990)). In order to be sufficient

1 Because the Court is dismissing this action, the alternative grounds offered by the Defendant are not addressed in this order.

5 under the statute, a lien statement must be subscribed and sworn, "which only the

affixed jurat or certificate by the officer administrating the oath can adduce." Pineland

Lumber Co., 382 A.2d at 38.

A claimant was not within the statute, therefore, when the notary subscription on

the claimant's lien statement was a "mere acknowledgement" that the subscriber was

the claimant or the claimant's agent and that the instrument was the claimant's free act

and deed. Id. at 39. Because the claimant was not within the statute, the attempted lien

was invalid and the trial court was correct to dismiss the claimant's suit. Id.

Rockingham attempts to distinguish Pineland and argues that the Lien Certificate

is sufficient despite the lack of a jurat because the body of the Lien Certificate contains

language stating that "IN WITNESS WHEREOF, Rockingham ... caused its name to be

hereunto affixed and this Certificate to be signed and sworn ...." (Pl.'s Opp. to Def.'s

Mot. Summ. J. 5.) However, the Court in Pineland held that the lien oath requirement

was not satisfied even when the body of the lien statement contained language stating

that the claimant "certif[ied] on oath" that it was a true statement. Pineland Lumber Co.,

382 A.2d at 35. The language "to be signed and sworn" sounds even less like an oath of

truth than the alleged oath statement in Pineland. Rockingham Elec. Supply Co. v. TRT

Elec. Inc., CUMSC-CV-2015-270 at *7 (Me. Super. Ct., Cum. Cty., Sep. 21, 2016).

Therefore, even viewing this evidence in the light most favorable to Rockingham,

Rockingham has failed to demonstrate a genuine dispute as to whether the Lien

Certificate satisfied the statutory oath requirement. Even if Rockingham did include the

word "sworn" in the last paragraph of the body of the Lien Certificate text, as a matter

of law this does not serve as a substitute for a the oath of truth that is statutorily

required to be in the jurat of a valid mechanic's lien. Rockingham Elec. Supply Co. v. TRT

Elec. Inc., CUMSC-CV-2015-270 at *7 (Me. Super. Ct., Cum. Cty., Sep. 21, 2016). See also

6 Pineland Lumber Co., 382 A.2d at 35.

Rockingham argues that a genuine issue of material fact exists as to the parties'

intention to be bound to the proposed agreement to discharge the lien and substitute a

bond for security. (Pl.'s Opp. to Def.'s Mot. Summ. J. 4.) However, Rockingham admits

that Wright-Ryan did not execute the proposed agreement (Def.'s S.M.F. 'f[ 21), and that

the Lien Certificate has not been discharged (Id. 'f['f[ 23, 29). Furthermore, Rockingham

offers no evidence that Wright-Ryan ever tendered the proposed bond or that the

proposed bond has been posted.

Even if the proposed agreement were binding, and even if the bond had been

posted, however, Rockingham could not prevail on the facts presented. Pursuant to the

language of the proposed agreement, Rockingham "must still prove the bases for its

Lien Claim in the court action." (Burns AH. Ex. 3 2; Mulligan A££. Ex. B 2.) Likewise,

pursuant to the proposed bond, "[i]n the event of any court of competent jurisdiction

should enter judgment on the mechanic's lien claim based on 10 M.R.S.A. Sec. 3251 et

seq.... this bond will be honored to the extent of such judgment." (Def.'s S.M.F. 'f[ 17

(alterations in original).) As discussed above, the Lien Certificate is insufficient,

meaning that Rockingham has failed to prove the bases for the Lien Claim and this

action will not result in a favorable judgment on which Rockingham could collect on the

proposed bond. See Rockingham Elec. Supply Co. v. TRT Elec. Inc., CUMSC-CV-2015-270

at *7 (Me. Super. Ct., Cum. Cty., Sep. 21, 2016). More importantly, without a valid lien

statement, the Court has no jurisdiction to consider Rockingham's motion to enforce.

See Pineland Lumber Co., 382 A.2d at 35, 39.

7 III. Motion for Sanctions.

Wright-Ryan moves for sanctions against Rockingham pursuant to M.R. Civ. P.

11.

Pursuant to Rule 11, the signature of an attorney on a pleading or motion

constitutes a representation by the signer that the signer that "to the best of the signer's

knowledge, information, and belief there is good ground to support it." M.R. Civ. P.

ll(a). If a pleading or motion is signed with intent to defeat the purpose of Rule 11, the

court, upon motion or upon its own initiative, may impose upon the signer, upon the

represented party, or upon both, an appropriate sanction. Id. This sanction may include

an order to pay to the opposing party reasonable expenses, including reasonable

attorney's fees. Id.

b. Discussion.

Wright-Ryan argues that sanctions are in order against Rockingham in part

because counsel for Wright-Ryan informed counsel for Rockingham that the Lien

Certificate was fatally flawed for lack of jurat prior to Rockingham filing its amended

complaint in this matter. (Def.'s Mot. Summ. J. 14; Def.'s S.M.F.

Specifically, in his March 11, 2016 email to counsel for Rockingham, counsel for Wright­

Ryan wrote, "[h]ere is the case that, we think, means your lien claim cannot survive.

There are other reasons that it cannot survive, but perhaps this one is the simplest."

(Burns. Aff. Ex. 11.) A copy of Pineland Lumber Co. v. Robinson, 382 A.2d 33, 38 (Me.

1978), was attached to the email. Id. Although the Court agrees with counsel for Wright­

Ryan that the Lien Certificate is insufficient under Pineland, the Court does not see fit to

order sanctions simply because counsel for Rockingham sought to distinguish the lien

8 statement in Pineland from the one in this case. The two statements are not identical and

there was a genuine issue of law as to whether Pineland applied in this case.

Wright-Ryan also argues that sanctions are in order against Rockingham because

in its amended complaint and in its earlier objection to Wright-Ryan's motion to dismiss

the original complaint, "Rockingham asks this Court to effectively recognize and

enforce the unexecuted agreement against Wright-Ryan." (Def.'s Mot. Summ. J. 14-15.)

While there is no dispute that Wright-Ryan never counter-executed the proposed

agreement, the Court takes issue with the fact that Wright-Ryan, in its Statement of

Material Facts, mischaracterized the proposed agreement executed by Rockingham by

referring to it as a "new draft agreement." (Def.'s S.M.F.

by the record, and as effectively admitted by Wright-Ryan, the language of "new draft

agreement" that Rockingham executed was identical to the language of the "draft

agreement" that counsel for Wright-Ryan provided to counsel for Rockingham. (Burns

Aff. Ex. 3 1; Pl.'s Reply to Def.'s S.M.F.

Ex. B 2; Def.'s Reply to Pl.'s S. Add'l M.F.

apparent discord between Wright-Ryan's initial characterization of its counsel's August

13, 2015 email to counsel for Rockingham as an "offer" to which Rockingham replied

with a "counteroffer" (Def.'s S.M.F.

August 13 email as "not an offer but at best a solicitation for an offer" (Def.'s Reply to

Pl.'s S. Add'l M. F.

(Def.'s Reply to Pl.'s Opp. to Def.'s Mot. Summ. J. 1 n.2). Given the ambiguity created

by both parties with regard to the proposed agreement, the Court does not see fit to

order sanctions against Rockingham in this regard.

Finally, although it is not explicitly included in Wright-Ryan's argument for

sanctions (Def.'s Mot. Summ. J. 14-15), Wright-Ryan notes elsewhere (id. 1, 2, 6, 12, 13,

9 14, 15) that despite Rockingham's assertions to the Court, the Lien Certificate has not

been discharged and the proposed bond has not been posted. In the amended

complaint, Rockingham alleges that the Lien Certificate "was discharged by

[Rockingham] on or about September 18, 2015 upon the posting of a bond by Wright[­

Ryan] pursuant to 10 MRSA §3263." (Pl.'s Am. Compl. <[ 10.) Rockingham adds, "[a]

copy of said bond is attached hereto as Exhibit B." (Id.) Further down, Rockingham

alleges that Wright-Ryan "has posted a bond as contemplated in 10 MRSA §3263 to

secure the release of the lien from [Rockingham]." (Id.<[ 14.) In its Statement of

Additional Material Facts, Rockingham states that it "tendered the Discharge of Lien"

to Wright-Ryan on or about September 18, 2016. (Pl.'s S. Add'l M.F. <[ 39 (denied on

other grounds).) However, Rockingham also admits that Wright-Ryan never recorded

the Discharge of Lien (Def.'s S.M.F. <[ 23), the Lien Certificate was not discharged or

vacated (id.<[ 29), and no party has petitioned the Court under 10 M.R.S.A. § 3263 to

release the Lien Certificate or accept a bond as alternate security (Def.'s S.M.F. <[

33). Rockingham states that it commenced this action on September 18, 2015, in reliance

on what it considered an agreement to discharge the lien. (Pl.'s S. Add'l M.F.

However, even if that were true, Rockingham certainly knew or should have known

that Lien Certificate had not been discharged and the bond had not been posted by the

time Rockingham filed its amended complaint dated April 20, 2016.

Given Rockingham's clear misrepresentation to the Court that the Lien

Certificate had been discharged and a bond had been posted prior to the date of the

amended complaint, the Court is inclined to award some measure of sanctions against

Rockingham.

10 IV. Conclusion.

In light of the foregoing, the Defendant's motion for summary judgment as to the

sole count of the amended complaint is denied and the Amended Complaint is

dismissed with prejudice.

With regard to the Defendant's motion for sanctions, the Defendant will have 21

days from the date of this Order to submit an affidavit of attorney's fees. Plaintiff will

have 21 days from the date of Defendant's motion to object to the amount of attorney's

fees and costs and to argue why sanctions should not be imposed. Defendant will be

allowed 10 days to respond.

The Clerk is directed to enter this Order and Decision on the civil docket by

reference pursuant to M.R. Civ. P. 79(a). ,;, 0/;? ' . -·..~ ~. -_._....~·~.....__/. . ,(/~ "·\ _i- ---,_/t._, \ _., ..~·--;? ~ Date: February 14, 2017 <:_ .. Daniel I. BilHngs \... Justice, Maine Superior.Court