Silverman v. Gossett

553 S.W.2d 581, 1977 Tenn. LEXIS 585
CourtTennessee Supreme Court
DecidedJuly 18, 1977
StatusPublished
Cited by8 cases

This text of 553 S.W.2d 581 (Silverman v. Gossett) is published on Counsel Stack Legal Research, covering Tennessee Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Silverman v. Gossett, 553 S.W.2d 581, 1977 Tenn. LEXIS 585 (Tenn. 1977).

Opinion

OPINION

HARBISON, Justice.

The single issue presented on this appeal is" the constitutionality of a portion of the Tennessee mechanics’ and materialmen’s lien statutes. Particularly at issue are T.C.A. § 64-1115 authorizing liens by subcontractors and suppliers, and § 64-1126 permitting attachments to enforce such liens. The Chancellor upheld the statutes under both the state and federal constitutions. We affirm his decision.

Five separate subcontractors and suppliers of the general contractor on a multi-building apartment complex notified the owners, appellants here, of their claims of lien and filed copies of such notices in the Davidson County Register’s Office, as required by T.C.A. §§ 64-1115,1117. Each of them timely filed suit within the prescribed ninety days after such notice. The suits have all been tried on their merits and the liens sustained after a full evidentiary hearing, at which all parties had an opportunity to offer proof.

In their answers to the suits, the owners denied the validity of the lien claims and also raised certain factual issues by counterclaims, none of which were pursued at the trial. Further, the owners challenged the validity of part of the lien statutes, alleging that a publicly recorded lien “restrains or materially diminishes the Counter-Plaintiffs’ ability to alienate or obtain credit on their property, and constitutes clouds upon their title.” It was further alleged that the owners had been damaged by reason of the filing of the lien claims pursuant to allegedly unconstitutional statutory provisions. In at least some of the cases, which were consolidated by order of the trial court, answers were filed to the counterclaims, specifically denying their allegations and joining issue thereon. The owners, however, offered no testimony at the trial in support of their damage claims, or in support of their allegation that there had been a diminution of their ability to mortgage or sell their property. After the Chancellor sustained the various liens, but before permitting their enforcement, he permitted an [582]*582appeal to this Court on the constitutional issues.

The appeal might be disposed of simply upon the failure of appellants to prove their counterclaims. Issues of fact were made in the pleadings, and appellants had the burden of proof to sustain their allegations of property interference and damages. There are other factual assertions made in their briefs, to the effect that they were not financially able to take advantage of certain bond provisions contained in the lien statutes. Again, there is no evidence to support these statements.

We do not understand that appellants question the statutes insofar as they authorize a court to establish a mechanic’s lien after trial, and upon final judgment. Their challenge is to the statutes authorizing the recordation of a lien claim and an initial attachment without bond, notice or a hearing.

In the many recent cases in which constitutional attacks have been made upon mechanics’ lien statutes and other pre-judgment procedures, prejudice to the property owner has either been obvious, or it has been proved. In some instances suits have been dismissed, in whole or in part, because of failure of the owner to carry the burden of proof to sustain a constitutional attack. See, e. g., Carl A. Morse, Inc. v. Rentar Industrial Development Corp., 56 A.D.2d 30, 391 N.Y.S.2d 425 (1977), in which validity of the New York mechanics’ lien statutes was upheld, with the decision resting, in part at least, upon insufficiency of the evidence offered by the landowner.

Because of the “limited intrusion” upon the landowner’s rights represented by a mechanics’ lien, as contrasted to the serious consequences which would be sustained by the construction industry upon invalidation of lien statutes, the United States District Court for the Eastern District of Michigan sustained the lien statutes of that state in the case of Central Security National Bank of Lorain County v. Royal Homes, Inc., 371 F.Supp. 476 (E.D.Mich.1974). It found that lack of proof of hardship by the landowner was a factor to be considered in making its determination.

We have alluded to the absence of proof of hardship or inconvenience in the instant case, which makes the claim of the appellants almost theoretical. The lien claims sustained in these five cases amount to $33,-364.07. The enterprise conducted by the landowners is a multi-million dollar complex, the record reflecting a construction loan alone of $1,700,000.00. We certainly cannot take judicial notice that the owner of such a complex would have much difficulty in selling or mortgaging his property in the face of these relatively insignificant lien claims, and it is difficult to believe that an adequate indemnity bond or escrow arrangement could not be effected so as to permit ready encumbrancing or conveyancing. This, of course, might not be true in all cases involving mechanics’ liens, depending upon the facts. In the present case, not only are the lien claims small, but throughout the litigation, the landowners have remained in possession of their property, including the improvements, labor and materials supplied by the lien claimants, with complete freedom to lease or rent the same and receive the income therefrom.

Even if we overlook the insufficiency of the landowners’ evidence, however, we are of the opinion that their constitutional claims are not well taken.

Mechanics’ lien statutes in favor of subcontractors and suppliers have been in force in Tennessee since at least 1845. Their validity was upheld in cases decided during the latter part of the nineteenth and early twentieth centuries. They were explicitly sustained against due process attacks, under both the state and federal constitutions, in Cole Manufacturing Co. v. Falls, 90 Tenn. 466, 16 S.W. 1045 (1891). See also Green v. Williams, 92 Tenn. 220, 21 S.W. 520 (1893); Ruston v. Perry Lumber Co., 104 Tenn. 538, 58 S.W. 268 (1900).

There have been a number of cases in other states and in the federal courts following certain recent holdings of the United States Supreme Court in connection with prejudgment seizure of chattels, wages and other personal property. It is upon these [583]*583cases that appellants here, like similar claimants in other jurisdictions, predicate their contentions that the Tennessee statutes are lacking in essential due process requirements.

In four well-known and widely discussed decisions between 1969 and 1975, the United States Supreme Court examined pre-judgment procedures authorized by statutes in a number of states. In three of these cases the statutes were held invalid, and in one the statute was sustained. In Sniadach v. Family Finance Corp., 395 U.S. 337, 89 S.Ct. 1820, 23 L.Ed.2d 349 (1969), the pre-judgment seizure of wages by garnishment as provided by Wisconsin statutes was held unconstitutional. The replevin statutes of Florida and Pennsylvania were stricken in the case of Fuentes v. Shevin, 407 U.S. 67, 92 S.Ct. 1983, 32 L.Ed.2d 556 (1972). In Mitchell v. W. T. Grant Co., 416 U.S. 600, 94 S.Ct.

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Cite This Page — Counsel Stack

Bluebook (online)
553 S.W.2d 581, 1977 Tenn. LEXIS 585, Counsel Stack Legal Research, https://law.counselstack.com/opinion/silverman-v-gossett-tenn-1977.