S.K. Drywall, Inc. v. Developers Financial Group, Inc.

799 P.2d 1362, 165 Ariz. 588
CourtCourt of Appeals of Arizona
DecidedNovember 27, 1990
Docket1 CA-CV 88-382
StatusPublished
Cited by5 cases

This text of 799 P.2d 1362 (S.K. Drywall, Inc. v. Developers Financial Group, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
S.K. Drywall, Inc. v. Developers Financial Group, Inc., 799 P.2d 1362, 165 Ariz. 588 (Ark. Ct. App. 1990).

Opinions

OPINION

SHELLEY, Judge.

On cross-motions for summary judgment, the trial court entered judgment for appellee S.K. Drywall, Inc. (Sunland) on a mechanic’s lien discharge bond given by appellant Developers Financial Group, Inc. (DFG) and its surety, Fidelity & Deposit Company of Maryland. See A.R.S. § 32-1152(E). The trial court denied Sun-land’s request for an award of attorney’s fees pursuant to A.R.S. § 12-341.01(A).

DFG appeals, challenging the validity of Sunland’s underlying mechanic’s lien. Sun-land cross-appeals from the denial of attorney’s fees.

The following issues are presented in the appeal and cross-appeal. Our answers are set forth in parentheses.

1) Is the legal description in Sunland’s lien overbroad and therefore invalid? (It is not overbroad.)

2) Does Sunland’s lien fail to identify sufficiently certain portions of the condominium development to which the lien was to attach? (The lien does not sufficiently identify the location of the ramada, models, and sales office.)

3) Is Sunland’s lien invalid for failing to distinguish the amounts claimed under its separate drywall and stucco sub-contracts and did it fail to apportion the total among the individual condominium units? (The lien properly apportioned the amounts claimed to each building. It was not necessary to distinguish between the amounts claimed under its two sub-contracts.)

4) Is Sunland’s lien time-barred with respect to all buildings except building 6? (It is time-barred except for building 6.)

5) Was Sunland eligible for an award of attorney’s fees under A.R.S. § 12-341.01(A)? (No.)

FACTS AND PROCEDURAL HISTORY

DFG is the owner and developer of the real property in question. The real property consists of a condominium project of seventy units built for separate ownership by individuals. The project includes a swimming pool, a ramada, landscaping, streets and driveways owned in common by the homeowners. The condominium units are grouped into separate buildings numbered 1 through 11 on the plat map. Building 2 consists of three condominium units and building 6 consists of four units. Each of the remaining buildings consists of seven units.

On October 30, 1985, Drongo, Inc., not a party to this appeal, contracted with DFG to build eleven condominium buildings, the landscaping and pool area, and off-site improvements. DFG’s contract with Drongo provided a contract price of $3,241,320. The contract price was itemized in thirteen separate schedules, one for each of the eleven buildings, one for the landscaping and pool area and one for off-site improvements.

Article 4.1 of the contract provided: Based upon Applications for Payment submitted to the Architect by the Contractor and Certificates for Payment issued by the Architect, the Owner shall make progress payments on account of the Contract sum to the Contractor as provided in the Contract Documents for the period ending the 25TH day of the month as follows:
PROGRESS PAYMENTS SHALL REFLECT 100% OF MATERIALS, 90% OF MAJOR SUBCONTRACTED TRADE. AFTER 50% OF THE WORK IS COMPLETED, PROGRESS PAYMENTS SHALL REFLECT 100% OF MATERIALS AND 95% OF MAJOR SUBCONTRACTED TRADE.
THE RETENTION SHALL BE PAID WITHIN THIRTY (30) DAYS AFTER OCCUPANCY OF ANY UNIT IN A GIVEN BUILDING AND NOT MORE THAN NINETY (90) DAYS AFTER ACCEPTANCE OF EACH BUILDING BY THE OWNER.
[591]*591PAYMENTS WILL BE MADE ON OR BEFORE THE 10TH OF EACH MONTH ON PERCENTAGE OF COMPLETION WITH LIEN WAIVERS FOR THE PREVIOUS MONTH WITH CURRENT MONTH BILLING.

Article 5.1 of the contract provided:

Final payment, constituting the entire unpaid balance of the Contract Sum, shall be paid by the Owner to the Contractor when the Work has been completed, the Contract fully performed, and a final Certificate for Payment has been issued by the Architect.

On November 13, 1985, Sunland and Drongo entered into a subcontract for drywall, labor, and materials. Under the subcontract, Drongo agreed to pay Sunland a contract price of $211,100.00, determined as the sum of $2,127.00 for the ramada, $9,038.02 for building 2, $11,859.28 for building 6, and $20,897.30 each for buildings 1, 3 through 5, and 7 through 11. Article 3.1 of the subcontract provided in pertinent part:

ATTACHED IS A TYPICAL BUILDING SCHEDULE. THE SUBCONTRACTOR SHALL ADHERE TO THIS SCHEDULE AND COMPLETE THE VARIOUS PHASES OF WORK IN THE TIME ALLOTTED. THE SUPERINTENDENT SHALL PROVIDE THE SUBCONTRACTOR WITH ADVANCE NOTIFICATION OF ACTUAL COMMENCEMENT DATE FOR VARIOUS PHASES OF THE WORK AND MAY MODIFY THE CONSTRUCTION SCHEDULE FROM TIME TO TIME AS DEEMED NECESSARY TO COMPLETE A BUILDING IN 19 WEEKS.

Article 5 of the subcontract required Drongo to make monthly progress payments to Sunland, and required Sunland to submit applications to Drongo for monthly progress payments on or before the twenty-fifth day of each month. Article 5.2 provided in pertinent part:

BILLING APPLICATIONS MUST BE ACCOMPANIED BY LIEN WAIVER FOR PREVIOUS MONTHS PAYMENT, UNLESS PREVIOUSLY SUPPLIED. PAYMENTS WILL BE 90% OF THE CURRENT MONTHS COMPLETED LABOR, MATERIAL AND EQUIPMENT COSTS. PRIOR TO FIRST PAYMENT APPLICATION, SUBCONTRACTOR SHALL PROVIDE A LIST OF SUPPLIERS OF $1,000.00 OR MORE OF MATERIAL, EQUIPMENT AND LABOR AND LIEN WAIVERS WILL BE REQUIRED FROM THESE SUPPLIERS.

Article 6.1 provided that final payment of the contract sum would be made when Sun-land fully completed the work satisfactorily to the architect. Retention payments were to be made as follows:

RETENTION SHALL BE PAID WITHIN THIRTY (30) DAYS AFTER OCCUPANCY OF ANY UNIT IN A GIVEN BUILDING AND NOT MORE THAN NINETY (90) DAYS AFTER ACCEPTANCE OF EACH BUILDING BY THE OWNER, PER THE GENERAL CONTRACT.

On November 19, 1985, DFG recorded its “Declaration of Horizontal Property Regime/Condominium of THE COURTS AT GAINEY RANCH” with the Maricopa County Recorder. Attached as Exhibit A to the Declaration was a one-page, single-spaced metes and bounds legal description of the property subject to the Declaration. Attached as Exhibit B was a condominium plat for “The Courts at Gainey Ranch.” The plat included two maps of the contemplated condominium development. All of the building numbers were reflected on each map.

On August 16,1986, Sunland and Drongo entered into a separate subcontract for stucco, labor and materials. The subcontract provided a contract price of $172,000. This figure was determined as the sum of $28,500 each for buildings 1, 3, 4, 5, and 11, $12,714 for building 2 and $16,786 for building 6. The provisions for progress payments and final payment were identical in pertinent part to those under the drywall subcontract of November 13, 1985.

Drongo commenced work on or about November 19, 1985. None of the buildings in the project was at the same stage of construction at any one time. Buildings 7, 8, and 9 were the first to be constructed. [592]

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S.K. Drywall, Inc. v. Developers Financial Group, Inc.
799 P.2d 1362 (Court of Appeals of Arizona, 1990)

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Bluebook (online)
799 P.2d 1362, 165 Ariz. 588, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sk-drywall-inc-v-developers-financial-group-inc-arizctapp-1990.