Wavetek Indiana, Inc. v. K.H. Gatewood Steel Co.

458 N.E.2d 265, 1984 Ind. App. LEXIS 2210
CourtIndiana Court of Appeals
DecidedJanuary 3, 1984
Docket2-283A66
StatusPublished
Cited by11 cases

This text of 458 N.E.2d 265 (Wavetek Indiana, Inc. v. K.H. Gatewood Steel Co.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wavetek Indiana, Inc. v. K.H. Gatewood Steel Co., 458 N.E.2d 265, 1984 Ind. App. LEXIS 2210 (Ind. Ct. App. 1984).

Opinion

HOFFMAN, Judge.

Appellant Wavetek Indiana, Inc., appeals from judgment of the Marion Superior Court ordering the foreclosure of a me-chanie's lien in favor of appellee KH. Gate-wood Steel Company, Inc.

In August 1979, Sheppard Construction, Inc., agreed to construct a new manufacturing building for Wavetek. On September 25, 1979, Sheppard subcontracted with Gatewood for structural steel work associated with this project. Sheppard and Gate-wood proceeded with their respective work on the building in conformance with plans specified by Wavetek in August. In spite of their earlier agreement, Wavetek and Sheppard executed a comprehensive written contract for work already completed and work yet to be done on December 14, 1979. This contract contained the following no-lien provision:

"ARTICLE 8
NO LIEN CONTRACT
This contract is a no-lien contract. Nei ther the Contractor nor any subcontractor, mechanic, journeyman, laborer or other person performing labor upon or furnishing materials, machinery or equipment for the property or improvements of the Owner shall have any right to any lien upon such property or improvement. In the event the Work to be performed under this contract is modified or altered, or in the event that there are any extras performed by or under the supervision of the Contractor which are not part of the original contract, it is agreed by the Owner and Contractor that the foregoing 'mo-lien' provisions shall apply to any such modified, altered, or extra work, materials, labor, machinery or equipment. The property of the Owner upon which such improvements are to be built and upon which the Work is to be performed is described on Exhibit D, a copy of which is attached hereto and made a part hereof."

This no-lien agreement was duly recorded in conformance with Indiana statute, and filed in the office of the Marion County Recorder, on December 17, 1979. Gate-wood was never informed of the existence of the principal contract or of this no-lien agreement.

On February 1, 1980, Gatewood executed a Waiver of Lien document releasing all lien rights accrued at that point in time. Later that month, Sheppard solicited bids for additional light structural steel work, eventually accepting Gatewood's bid of $15,200. By August 1, 1980, all work had been completed on the original contract between Sheppard and Gatewood. Gate-wood completed work under the second contract on August 26, 1980, and submitted a final invoice to Sheppard showing a balance due of $90,299.10. Gatewood recorded its Notice of Intention to hold a Mechan-ie's Lien for this amount on October 10, 1980. On October 29, 1980, Sheppard notified its subcontractors that it was stopping all work on the Wavetek building due to financial difficulties.

Gatewood filed this action in the Marion Superior Court on November 26, 1980, naming Wavetek, Sheppard, and various subcontractors as defendants. Count I of Gatewood's complaint sought to foreclose a mechanic's lien against Wavetek's property *268 in the amount of $90,299.10. Count II alleged a right to recover against Wavetek and Sheppard on a theory of quantum meruit. A bench trial was held resulting in an order to foreclose Gatewood's mechanic's lien. Additionally, Gatewood was awarded $8,000 in attorney fees and $17,-581.87 in prejudgment interest.

Wavetek first asserts that the trial court erred as a matter of law in failing to find that Gatewood had two separate contracts with Sheppard, and that the right to acquire a mechanic's lien under the first contract had expired. The trial court's findings of fact indicate that Sheppard executed one contract with Gatewood in the gross amount of $346,857. This finding contradicts all evidence produced at trial on this issue. The record indicates that Gate-wood entered into a contract with Sheppard on September 25, 1979. This contract was for specified structural steel work, and a price of $330,257 was agreed upon. In March of 1980, Gatewood submitted a written bid to do certain light structural steel work in conformance with new architectural plans forwarded by Wavetek. Sheppard accepted this bid for the price of $15,200, and Gatewood began work while still performing under its earlier contract. Without a doubt, two contracts were executed between Sheppard, as general contractor, and Gatewood, as subcontractor.

The real issue in this regard is whether Gatewood properly filed within statutory time requirements in order to effectively secure mechanic's liens against Wavetek's property. IND.CODE § 82-8-3-3 provides in part that:

"Notice of intention to hold lien; filing See. 8. Any person who wishes to acquire a lien upon any property, whether his claim be due or not, shall file in the recorder's office of the county, at any time within sixty (60) days after performing such labor or furnishing such materials; or machinery, described in section 1 [32-8-3-1] of this chapter, a sworn statement in duplicate of his intention to hold a lien upon such property for the amount of his claim, specifically setting forth the amount claimed, the name and address of the claimant and the name of the owner, and shall give legal description, street and number, if any, of such lot or land on which the house, mill, manufactory or other buildings, bridge, reservoir, system of waterworks or other structure may stand or be connected with or to which it may be removed."

Because this statute is in derogation of the common law, its provisions must be strictly construed. Wiggin v. Gee Co., (1979) 179 Ind.App. 631, 386 N.E.2d 1218. One asserting rights to a mechanic's lien bears the burden of bringing himself within the provisions of this statute. William F. Steck Co. et al. v. Springfield, (1972) 151 Ind.App. 671, 281 N.E.2d 530.

In the case at bar, Gatewood failed to prove its Notice of Intention to Hold a Mechanic's Lien under the first contract was timely filed. The only evidence in the record indicates the last work done under this contract occurred prior to August 1, 1980. Gatewood failed to file until October 10, 1980, thereby exceeding the sixty-day time limit. Having failed to strictly comply with statutory requirements, Gatewood is foreclosed from obtaining a mechanic's lien for the unpaid balance of this contract.

In regard to the second contract, the trial court correctly found Gatewood's notice timely filed, since work continued on this project until August 26, 1980. Gate-wood now asserts that these two contracts were component parts of the same project, and timely filing under one contract is sufficient to obtain a lien for all money due on the entire project. However, where labor or materials are furnished under separate contracts, even though the contracts are between the same persons, and relate to the same building or improvement, the contracts cannot be tacked together to enlarge the time for filing a lien for what was done or furnished under either, but a lien must be filed for what was done under each contract within the statutory period after its completion. Dix v. Willfred Coal Co., (1921) 76 Ind.App. 511, 132 N.E. 595; 27 *269 Cyc. p. 144. Clearly the trial court erred in this regard.

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Bluebook (online)
458 N.E.2d 265, 1984 Ind. App. LEXIS 2210, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wavetek-indiana-inc-v-kh-gatewood-steel-co-indctapp-1984.