United Metro Materials, Inc. v. Pena Blanca Properties, L.L.C.

4 P.3d 1022, 197 Ariz. 479, 318 Ariz. Adv. Rep. 14, 2000 Ariz. App. LEXIS 49
CourtCourt of Appeals of Arizona
DecidedApril 4, 2000
Docket1 CA-CV 99-0331
StatusPublished
Cited by12 cases

This text of 4 P.3d 1022 (United Metro Materials, Inc. v. Pena Blanca Properties, L.L.C.) 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
United Metro Materials, Inc. v. Pena Blanca Properties, L.L.C., 4 P.3d 1022, 197 Ariz. 479, 318 Ariz. Adv. Rep. 14, 2000 Ariz. App. LEXIS 49 (Ark. Ct. App. 2000).

Opinion

OPINION

EHRLICH, Judge.

¶ 1 United Metro Materials, doing business as San Xavier Rock & Materials (“San Xavier”), filed suit to foreclose its lien for materials supplied for the Pena Blanca Highlands project of Pena Blanca Properties, L.L.C. (“Pena Blanca”). Pena Blanca obtained a lien-discharge bond pursuant to Arizona Revised Statutes (“A.R.S.”) section 33-1004 from Far West Insurance Company (“Far West”), thereby removing San Xavier’s lien from the property by operation of law. San Xavier then filed an amended complaint to assert a claim on the bond against Pena Blanca and Far West. In response, Pena Blanca counterclaimed, seeking damages from San Xavier for filing a wrongful lien.

¶ 2 Cross-motions for summary judgment were filed. The trial court granted San Xavier’s motion for the amount stated in the lien, and it awarded attorneys’ fees. Pena Blanca’s subsequent motion for new trial was denied.

¶ 3 Pena Blanca appealed. We affirm the judgment.

BACKGROUND 1

¶ 4 Pena Blanca acquired a large tract of land near Nogales, Arizona. It sold a portion of the land to the Nogales School District, but it retained the remainder of the tract for a project known as Pena Blanca Highlands.

¶ 5 On May 24, 1995, Pena Blanca entered a contract with Able Contracting, Inc. (“Able”), to provide contracting and construction services for Pena Blanca Highlands. Two months later, Able began to purchase materials on credit from San Xavier for use on this project. 2

*481 ¶ 6 For the materials San Xavier supplied to Able for Pena Blanca Highlands, pursuant to A.R.S. § 33-992.01, San Xavier’s lien service filed and served on Pena Blanca four preliminary 20-day notices dated September 5 and 29 and November 3 and 16,1995; each notice identified the job site as “Frontage Road Off 1-19 ... Pena Blanca Highlands” and included the project’s legal description. There is no dispute that Pena Blanca received these notices.

¶ 7 According to the joint-check provision in the contract between Able and Pena Blanca, 3 Pena Blanca made the following three payments to Able and San Xavier to reimburse them for materials:

DATE CHECK NUMBER AMOUNT OF CHECK

10- 10-95 2437 $ 2,207.97

11- 10-95 2452 $31,987.14

12- 08-95 2481 $12,824.25

For each of these joint checks, Able issued its own check solely payable to San Xavier for at least the amount of the joint check, and San Xavier endorsed the joint check to Able.

¶8 Because San Xavier received these cheeks from Able as payment for materials, San Xavier executed three “unconditional lien waivers” pursuant to A.R.S. § 33-1008. On the first unconditional lien waiver, dated November 13,1995, San Xavier stated that it had received $2208.00 for all materials furnished to Able for Pena Blanca Highlands for the month of September 1995. The second unconditional lien waiver, dated November 20, 1995, specified that San Xavier had received a payment of $34,987.14 for materials provided to Able for Pena Blanca Highlands through October 31,1995.

¶ 9 Prior to executing the last of the three waivers, however, San Xavier received a letter dated December 11,1995, from Able with Abie’s cheek number 5440 and a joint check from Pena Blanca, each in the identical amount of $12,854.50. Also enclosed in the letter was an unconditional lien waiver for San Xavier to execute. The author of the letter explained that the check from Able was a “partial payment through November 30, 1995,” and San Xavier was instructed to apply the check to San Xavier’s invoice numbers 153915 and 153604. Although the check equaled the total amount of the sums due according to these two invoices, other invoices for materials delivered during November 1995 remained unpaid.

¶ 10 Consequently, before signing and returning this unconditional lien waiver form to Able, San Xavier’s credit manager typed in the blank space on the form which was to be used for specifying the date covered by the waiver, that the waiver was “Partial through November 30, 1995.” He then drew a line from these words to a blank area of the form where he also wrote “for invoices 153915 153604 only!” followed by his signature. As of December 18, 1995, the date of the form, Pena Blanca received notice that San Xavier had unpaid invoices remaining.

¶ 11 Thereafter, Pena Blanca issued no more joint cheeks payable to Able and San Xavier. However, Pena Blanca did issue at least three more checks in January and February 1996 payable solely to Able in the combined amount of $35,283.62. It also issued another check payable solely to Able in the amount of $61,878.00 in December 1995.

¶ 12 San Xavier never received payment for the other materials it had supplied in November 1995, nor for the additional materials it supplied during the following months of December, January and February. Accordingly, on March 8, 1996, San Xavier recorded a lien on Pena Blanca’s property in the amount of $33,854.10 to protect its right to recover the reasonable value of the materials it had supplied to Able for the Pena Blanca Highlands. 4 Additionally, in order to evaluate the position it would take regarding the lien, Pena Blanca obtained copies of San Xavier’s invoices to Able for the materials it *482 had supplied to Pena Blanca, both those for which San Xavier had been paid and those for which San Xavier claimed that it had not received payment.

¶ 13 Meanwhile, Pena Blanca terminated Able for non-performance. Rather than find another contractor, on February 16, 1996, Pena Blanca contracted directly with San Xavier to purchase on credit materials it needed to finish the Pena Blanca project. According to this credit agreement, San Xavier supplied materials directly to Pena Blanca from March through June 1996.

¶ 14 During this time, San Xavier sent Pena Blanca two new preliminary 20-day notices for the additional materials to be supplied, reflecting its new direct relationship with Pena Blanca. San Xavier also executed four unconditional lien waivers for the materials it supplied under the direct agreement with Pena Blanca. These unconditional lien waivers differed from the previous waivers San Xavier had executed in one key respect: These unconditional lien waivers identified Pena Blanca instead of Able as the entity with which San Xavier had contracted to supply these materials for the Pena Blanca Highlands project. Pena Blanca eventually paid in full for the materials supplied directly to it pursuant to this agreement.

¶ 15 Pena Blanca ultimately refused to pay San Xavier for the additional materials that were the subject of the lien dated March 8, 1996. Because San Xavier claimed to have supplied to Able these materials for the Pena Blanca Highlands and not been reimbursed, San Xavier filed this action to foreclose the lien.

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Bluebook (online)
4 P.3d 1022, 197 Ariz. 479, 318 Ariz. Adv. Rep. 14, 2000 Ariz. App. LEXIS 49, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-metro-materials-inc-v-pena-blanca-properties-llc-arizctapp-2000.