Torke/Wirth/Pujara, Ltd. v. Lakeshore Towers of Racine

531 N.W.2d 419, 192 Wis. 2d 481, 1995 Wisc. App. LEXIS 317
CourtCourt of Appeals of Wisconsin
DecidedMarch 8, 1995
Docket93-2507
StatusPublished
Cited by2 cases

This text of 531 N.W.2d 419 (Torke/Wirth/Pujara, Ltd. v. Lakeshore Towers of Racine) is published on Counsel Stack Legal Research, covering Court of Appeals of Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Torke/Wirth/Pujara, Ltd. v. Lakeshore Towers of Racine, 531 N.W.2d 419, 192 Wis. 2d 481, 1995 Wisc. App. LEXIS 317 (Wis. Ct. App. 1995).

Opinion

ANDERSON, P.J.

Owners of a condominium project, lenders, realty companies and title insurance companies appeal from a judgment of the circuit court, awarding in personam money judgments against Lakeshore Towers of Racine, a joint venture, Korndoerfer Development Group, Ltd. and Capstone Development Corporation and granting an in rem construction lien foreclosure judgment against the owners' properties. Korndoerfer Corporation cross-appeals from the judgment wherein the court conditioned the construction lien foreclosure judgment against the properties and property interests of the owners upon an apportionment of the amount of the judgment.

Because we conclude that a subcontractor must file a thirty-day notice of intent to file a lien claim in order to maintain an independent lien claim; that where a subcontractor brings an independent lien claim against owners, the prime contractor has a duty to defend the owners even where the prime contractor is owed money; and that prejudgment interest is not a lienable item that can be collected against the properties of nonprivity owners, we reverse in part. Because we conclude that the Korndoerfer Corporation satisfied the thirty-day notice requirement when it placed the notices in the mail; that the Korndoerfer Corporation properly perfected its lien as against the owners and properly amended its lien within the six-month period under § 802.09(1), Stats.; and that the trial court correctly divided the lien proportionally among the owners, we affirm in part.

*489 FACTS

Korndoerfer Development Group, Ltd. and Capstone Development Corporation entered into a joint venture, known as Lakeshore Towers of Racine (the developers), to develop and construct a condominium project. The project is an eight-story residential condominium facility containing 72 residential units and 255 parking units. In August of 1988, the developers entered into a contract with Korndoerfer Corporation (KC) as the construction manager for the project. Siesel Construction Company (Siesel) and Bill Dentinger, Inc. (Dentinger) were trade contractors to KC. KC had no contractual relations with any of the subsequent unit owners in the project.

Torke/Wirth/Pujara, Ltd. (TWP) was the architectural firm providing services on the project. On January 31,1991, TWP stopped working on the project because of the developers' nonpayment. A separate judgment was entered in this case in favor of TWP and against the developers.

On appeal, the individual unit owners, lenders, realty companies and title insurance companies (owners) challenge, among other things, procedural aspects of KC's lien claim. KC sent a thirty-day notice of intent to file a claim for lien by registered mail, return receipt requested, on September 9,1991, to the developers. KC filed a claim for lien against the developers on October 30,1991, in the amount of $298,823.60.

On October 17,1991, KC sent a thirty-day notice of intent to file a claim for lien by registered mail, return receipt requested, to the owners of the condominium units to date. Notices to three more units were sent by registered mail, return receipt requested, on October 26, 1991. On November 27, 1991, KC filed an amendment to its lien claim, adding the individual owners of *490 the units in the project. The amendment was filed prior to this action and without leave of the court. The trial court held that this was the first lien claim filed against the interests of the individual unit owners. On April 27, 1993, the court granted KC's motion to amend the lien claim.

KC filed a second amendment to its lien claim on May 19,1992, without leave of the court, changing the amount of the lien to $554,642. The court held that this was the only amended lien claim filed against the interests of any of the individual unit owners. Subsequently, the trial court amended "the amounts of the lien claim, amended lien claims and [KC's] pleadings" to conform to the evidence presented at trial.

Following a bench trial, the trial court concluded that KC was entitled to an in personam money judgment against the developers, jointly and severally, and an in rem judgment "directing the foreclosure and sale of all residential and parking units in the Project, the proceeds of which shall be applied against the lienable unreimbursed services performed by KC on the Project." The court directed how the lienable portion of the amount to be collected by KC would be divided between KC, Siesel and Dentinger.

The trial court found that the last day on which KC performed any labor or furnished any materials directly to the project or through its subcontractors was no later than December 31, 1991. The trial court held that KC was entitled to recover the cost of subcontractors' additional services or materials to the project prior to December 31,1991.

The trial court found that the procedural validity of Dentinger's and Siesel's lien claims was moot because their liens were "independently valid, protected and preserved by incorporation under KC's lien."

*491 The trial court held that the construction liens were to be proportionally allocated among all of the condominium units. Prejudgment interest was to be paid at a rate of five percent per annum, not compounded, against the condominium units of third-party owners. The developers were required to pay prejudgment interest at a rate of twelve percent per annum, not compounded.

The owners appeal from the trial court's judgment. KC cross-appeals from the trial court's judgment wherein the trial court conditioned the construction lien foreclosure judgment against the properties and property interests of the owners upon an apportionment of the amount of the judgment.

DISCUSSION

Application of the Miller Act

The owners contend that Claus Wolfgang Korndoerfer is the principal behind Korndoerfer Development and KC. The owners argue that the principle of liberally constructing Wisconsin's lien law 1 "should not be applied to Korndoerfer's claim because of the transparently manipulative relationship between Korndoerfer and the entity which really should have paid, namely Mr. Korndoerfer's joint venture." While this issue has not yet been addressed by the Wisconsin *492 Supreme Court, the owners believe that it is well established in federal cases involving the Miller Act. 2

After a review of the transcripts, we conclude that the issue of Claus Korndoerfer's control over Korndoerfer Development and KC was an underlying but unplayed theme at trial. While the owners allude to the issue of common control in the statement of facts in their principal brief, they present no legal argument. This issue was raised for the first time in the owners' reply brief. We will not consider an issue raised for the first time in a reply brief. State v. Lewandowski, 122 Wis. 2d 759, 763, 364 N.W.2d 550, 552 (Ct. App. 1985).

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Bluebook (online)
531 N.W.2d 419, 192 Wis. 2d 481, 1995 Wisc. App. LEXIS 317, Counsel Stack Legal Research, https://law.counselstack.com/opinion/torkewirthpujara-ltd-v-lakeshore-towers-of-racine-wisctapp-1995.