Cordeck Sales v. Construction Systems

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State: Illinois

Court: 1st District Appellate

Docket No: 1-06-3702 Rel

Case Date: 03/31/2008

Preview:1-06-3702 THIRD DIVISION March 31, 2008

No. 1-06-3702

CORDECK SALES, INC., Plaintiff, v. CONSTRUCTION SYSTEMS, INC., et al., Defendants.

(A.L.L Masonry Construction Company, Inc., Just Rite Acoustics, Inc., Reinke Gypsum Supply Co., Stair One, Inc., AMEC Construction Management, Inc., and Inland Electric Corporation, Plaintiffs-Appellees; First Midwest Bank, Defendant-Appellant). )

) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

Appeal from the Circuit Court of Cook County.

No. 03CH6309

The Honorable Clifford L. Meacham, Judge Presiding.

JUSTICE GREIMAN delivered the opinion of the court: Five subcontractors and one construction manager (collectively appellees) filed claims seeking foreclosure of their mechanic's liens pursuant to the Mechanics Lien Act (770 ILCS 60/1 et seq. (West 2006)). First Midwest Bank (First Midwest), the holder of a valid mortgage lien on the property, also filed a claim to foreclose its lien. The parties then engaged in discovery and Bassam Hajyousif, the owner of two companies involved in the project, invoked his fifth

1-06-3702 amendment privilege against self-incrimination. The trial court denied First Midwest's motion to compel Hajyousif to testify as well as its motion to continue the proceedings until Hajyousif could testify. Thereafter, the trial court found that each of the appellees' mechanic's liens had priority over First Midwest's mortgage lien. The appellees and First Midwest then filed cross-motions for summary judgment, wherein the parties disputed the validity and amounts of each of the appellees' mechanic's liens. The trial court granted each of the appellees' motions for summary judgement and denied each of First Midwest's motions. First Midwest has appealed and is seeking reversal of each of the trial court's summary judgment orders. Specifically, First Midwest asserts that reversal is warranted because the trial court erred when it: (1) permitted Hajyousif to invoke his fifth amendment privilege against self-incrimination on a blanket basis with respect to the project instead of on a question-by-question basis and compounded its error when it denied First Midwest's motion to continue the proceedings until Hajyousif was available to testify; and (2) found the defenses First Midwest asserted against each of the appellees to be meritless. We affirm as modified. This appeal stems from a dispute among various parties involved in a construction project (Montreville Project or Project). The property at issue is a condominium building located at 520 N. Halsted Street in Chicago that contains 89 individual condominium units. At all relevant times, Northstar Trust Company (Northstar), as trustee, held the property in trust, with Savannah, Inc. (Savannah), named as the beneficiary of the trust. On February 4, 2000, Savannah contracted with AMEC Construction Management, Inc. (AMEC), to serve in the capacity of the "construction manager" on the Montreville Project.

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1-06-3702 Thereafter, on June 10, 2000, Savannah retained Construction Services International, Inc. (CSI), to perform general contracting services on the Montreville Project. Savannah and CSI had the same principals: Bassam Hajyousif and Romel Esmail. After being named the general contractor, CSI then entered into contracts with various second-tier contractors to provide subcontracting services on the Montreville Project. Specifically, CSI retained A.L.L. Masonry Construction Co., Inc. (ALL), to provide masonry services, Inland Electric Corp. (Inland) to provide electrical services, Chicago Drywall & Acoustical, Inc. (Chicago Drywall), to provide drywall and acoustic services, and Stair One, Inc. (Stair One), to provide steel services. Chicago Drywall, in turn, contracted with Just Rite Acoustics, Inc. (Just Rite), to install a suspension system for the drywall ceilings that were to be installed in the building and Reinke Gypsum Supply Co. (Reinke) to provide drywall and other interior building materials for use in the Project. On April 30, 2001, Northstar, as trustee, obtained a $16,736,960 mortgage on the property through CoVest Banc, National Association (CoVest), First Midwest's predecessor-ininterest. The mortgage contract was subsequently modified and the loan amount increased to $23,145,981. The mortgage was recorded on May 11, 2001. On or near the date the mortgage contract was executed, CoVest also obtained a loan policy of title insurance from Ticor Title Insurance Company (Ticor). The policy provided that Ticor would defend and indemnify CoVest for losses to the extent they were caused by title encumbrances. Coverage was provided by virtue of an escrow agreement entered into by Ticor, Savannah, and CoVest. The agreement provided that "[t]here will be MONTHLY disbursements, which are to be made in accordance with the terms and conditions of this escrow as hereunder set

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1-06-3702 forth." The terms of the escrow agreement required Ticor, the escrowee, to be furnished with various documents prior to disbursing funds from the construction escrow account including: a sworn general contractor's statement, a current dated sworn owner's affidavit, a certificate of inspection by the lender's inspector, as well as "[s]tatements, waivers, affidavits, supporting waivers and release of lien (if necessary), satisfactory to Ticor." After collecting the various documents and disbursing funds, the agreement also required Ticor to provide CoVest, the lender, with an endorsement, reflecting the validity and priority of CoVest's mortgage lien. AMEC, Inland, Reinke, Just Rite, ALL, and Stair One each performed under their respective contracts. Initially, the appellees each received timely payments in exchange for the labor and services they provided on the Montreville Project. Ultimately, however, payments stopped. As a result, the appellees recorded mechanic's liens with the Cook County recorder of deeds and filed claims to foreclose their liens in the circuit court, the details of which will be set forth below. On February 6, 2004, after the appellees recorded their lien claims and filed counterclaims to foreclose their mechanic's liens in the circuit court, CoVest filed a counterclaim to foreclose its mortgage lien totaling $23,808,829.19. Thereafter, First Midwest, "successor by merger to CoVest," entered into the litigation and filed responses to the appellees' counterclaims and asserted various affirmative defenses against them. On February 26, 2004, the circuit court appointed a Receiver for the completion of the Project and sale of the completed condominium units. On March 26, 2004, the circuit court entered an order providing that the existing mechanic's liens would attach to the proceeds of the

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1-06-3702 sale of the condominium units upon their sale by the Receiver. On October 14, 2004, the trial court entered default judgment in favor of the appellees and against Northstar, Savannah, and CSI due to their failure to comply with discovery. Thereafter, Inland, Reinke, Just Rite, and ALL moved for partial summary judgment against First Midwest on the issue of priority, asserting that their mechanic's liens had priority over First Midwest's mortgage lien because the underlying construction contract between Savannah and CSI predated the date of the recording of the mortgage. On March 24, 2005, the trial court entered an order finding that Inland, Reinke, Just Rite, and ALL's mechanic's' liens had priority over First Midwest's mortgage lien. AMEC also moved for partial summary judgment against First Midwest on the issue or priority, arguing its mechanic's lien had priority over First Midwest's mortgage lien because AMEC's contract with Savannah predated the date the mortgage was recorded. The trial court granted summary judgment in favor of AMEC on the issue of priority on October 24, 2005. While the parties were disputing the issue of priority, they were also engaging in extensive discovery. Esmail and Hajyousif, the principal owners of Savannah and CSI, were both deposed. Representatives from First Midwest, AMEC, Inland, Reinke, and Just Rite were present for Hajyousif's June 7, 2005, deposition, and First Midwest was the first party to question Hajyousif. Initially, Hajyousif provided details about his educational and professional background as well as his introduction to the Montreville Project. Counsel for First Midwest then began to ask specific questions concerning the Montreville Project and Hajyousif's knowledge of the entities involved in the Project. Specifically, counsel questioned Hajyousif as to his role in Savannah, the identity

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1-06-3702 of the person who kept Savannah's corporate records, the date CSI was formed, and the process by which Hajyousif purchased the property. In response to each question, Hajyousif cited the fifth amendment and refused to answer. Counsel then asked Hajyousif whether he intended to invoke the fifth amendment on a blanket basis in response to questions concerning the Montreville Project. Specifically counsel queried: "Is it your intention to assert the Fifth Amendment on all questions relating to the structure or acts of Savannah, Inc.?"and "Is it your intention to assert the Fifth Amendment with respect to all matters involving yourself and the 520 North Halsted Street project?" and "Is it also your intention to assert the Fifth Amendment with respect to [CSI's] contracts for improvement to the property on both ends, both in terms of its relationship with the owner and with respect to its relationships with contractors?" Hajyousif answered affirmatively to each of these questions. Thereafter, First Midwest's counsel, with the consent of Hajyousif's counsel, decided that First Midwest would appear before the trial court and let the court determine the propriety of Hajyousif's blanket assertion of his fifth amendment privilege instead of continuing with the deposition "because there is no point in having a deposition transcript that's five feet thick just to have the Fifth Amendment asserted time after time." Accordingly, First Midwest's counsel stopped his inquiry. Counsel for AMEC, Inland, Reinke, and Just Rite however, took turns questioning Hajyousif. Unlike First Midwest's counsel, they asked specific questions concerning Hajyousif and the Montreville Project despite Hajyousif's continued invocation of his fifth amendment privilege. On August 3, 2005, First Midwest filed a motion to compel in the trial court, asserting that Hajyousif did not have a reasonable basis to assert his fifth amendment privilege because he

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1-06-3702 "did not provide evidence of any danger of prosecution."1 First Midwest attached a copy of Hajyousif's deposition transcript to its motion. Thereafter, the trial court conducted an evidentiary hearing on First Midwest's motion to compel. At the hearing, Jennifer Nielsen, attorney for Zeman Concrete Corporation (a subcontractor that provided services on the Project, but is not a party to this appeal), testified that during the course of her representation of Zeman, she was contacted by a Federal Deposit Insurance Corporation (FDIC) employee who informed her he was investigating Hajyousif and the Montreville Project, specifically the "tens of millions of dollars of funds that have disappeared out of the project." Accordingly, he questioned Nielson about the process by which payments are typically disbursed from construction escrow accounts and about lien wavers. The FDIC employee never informed Nielsen directly that a criminal proceeding would be brought against Hajyousif, but did indicate that he had obtained Hajyousif's personal bank records. Peter Bedard, the attorney representing AMEC, also provided testimony at the hearing. He testified that in May 2005, he met with representatives from the FDIC, Federal Bureau of Investigation (FBI), and Internal Revenue Service (IRS) who indicated that they were investigating "monetary fraud issues" in connection with the Montreville Project as well as another project in which Hajyousif and Esmail were involved. The FDIC, FBI, and IRS employees indicated they were investigating Hajyousif and Esmail individually as well as the corporate entities involved in the projects and informed Bedard that they had subpoenaed

The record reveals that Esmail also invoked his fifth amendment privilege at his deposition; however, First Midwest subsequently settled with him and never filed a motion to compel his testimony in the trial court. 7

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1-06-3702 Hajyousif's and Esmail's individual bank records and that a grand jury had been seated. The federal investigators then asked Bedard various questions concerning the disbursement of funds, lien waivers, sworn affidavits from subcontractors, and the tasks performed by various subcontractors. After hearing the aforementioned testimony, counsel for First Midwest and Hajyousif delivered closing remarks. Counsel for First Midwest argued that a blanket assertion of Hajyousif's fifth amendment privilege was inappropriate. Specifically, he contested the scope of his privilege, arguing that Hajyousif failed to show that various areas of inquiry had "a reasonable nexus to the possibility of criminal conviction." Counsel for Hajyousif responded, noting that counsel for First Midwest did not dispute that federal investigators were investigating Hajyousif and his involvement with the Project. Moreover, counsel also contested the manner in which First Midwest was seeking review of the scope of Hajyousif's privilege and argued that "it is the duty of the party taking the deposition and asking the questions to ask all the questions that they intend to ask so that we can more squarely note exactly what they're asking." Finally, in response to First Midwest's argument as to the breadth of Hajyousif's fifth amendment privilege, counsel maintained that Hajyousif was entitled to invoke his fifth amendment privilege against self-incrimination on a broad basis because the scope of the federal investigation was broad. Counsel argued that if Hajyousif were to answer some questions and assert his privilege in response to other questions, he would essentially provide federal investigators with a roadmap as to how to conduct their investigations, which could prove to be incriminating.

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1-06-3702 During the hearing, the trial court never conducted a review of individual deposition questions. Nonetheless, based on the evidence revealed and the arguments delivered at the hearing, the trial court found that Hajyousif's blanket assertion of his fifth amendment privilege in relation to the Monteville Project was appropriate and denied First Midwest's motion to compel. Specifically, the court stated: "In my judgment, there's a reasonable basis for asserting a privilege against self-incrimination; and therefore, it's not inappropriate to invoke that privilege.*** [Hajyousif] can assert it on a blanket basis with respect to the [P]roject." Thereafter, on December 13, 2005, First Midwest filed a "Motion for Continuance Based on Bassam Hajyousif's Unavailability" pursuant to Supreme Court Rule 231(a) (134 Ill. 2d R. 231(a)). In its motion, First Midwest sought to stay all trial court proceedings "until such time as Hajyousif is available to testify," asserting that it was "materially prejudiced" by Hajyousif's assertion of his fifth amendment privilege. Attached to the motion was the affidavit of James Dash, one of the attorneys of record for First Midwest. In the affidavit he averred that "Mr. Hajyousif is a key witness on at least the following topics: (i) the contracts of, and work performed by, the various subcontractors who have asserted claims against or through CSI or Savannah; (ii) AMEC's contract and performance; (iii) CSI's payment for work performed on the Project. The breadth and detail of the knowledge he is likely to have appears to be unique." The trial court denied the motion on December 15, 2005. In doing so, the court remarked that it was "troubled by the fact that persons [other than Hajyousif] with direct and firsthand knowledge have not been deposed." Accordingly, the court cited First Midwest's failure to seek discovery through other witnesses and its belief that Hajyousif's "assertion of the Fifth

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1-06-3702 Amendment was well founded" as its reasons for the denial of First Midwest's motion for a continuance. Thereafter, the appellees and First Midwest filed cross-motions for summary judgment regarding the validity and amount of each of the appellees' mechanic's liens, the substance of which will be set forth below. The trial court granted each of the appellees' motions and denied each of First Midwest's motions. On November 30, 2006, the trial court entered a final order ordering the disbursement of money to satisfy the appellees' lien claims. First Midwest filed a timely notice of appeal. On appeal, First Midwest advances numerous arguments that purportedly compel reversal of the trial court's summary judgment orders. Some of the arguments pertain to individual lien claimants while others pertain to the appellees as a whole. We first will address the two arguments that First Midwest asserts against all of the appellees and then will turn to the specific arguments that First Midwest raises against the individual lien claimants. In reviewing First Midwest's arguments, we note that summary judgment is appropriately granted where the "pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." 735 ILCS 5/2-1005(c) (West 2006); Tefco Construction Co. v. Continental Community Bank & Trust Co., 357 Ill. App. 3d 714, 718 (2005). Although summary judgment has been deemed a "drastic means of disposing of litigation" (Purtill v. Hess, 111 Ill. 2d 229, 240 (1986)), it is nonetheless an appropriate mechanism to employ to expeditiously dispose of a lawsuit when the moving party's right is clear and free from doubt

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1-06-3702 (Morris v. Margulis, 197 Ill. 2d 28, 35 (2001)). "Where, as here, `the parties have filed crossmotions for summary judgment, they agree that no genuine issue as to any material fact exists and that only a question of law is involved, and they invite the court to decide the issue based on the record.' " SBC Holdings, Inc. v. Travelers Casualty & Surety Co., 374 Ill. App. 3d 1, 8 (2007), quoting Gawryk v. Firemen's Annuity & Benefit Fund of Chicago, 356 Ill. App. 3d 38, 41 (2005). Nonetheless, " `the mere filing of cross-motions for summary judgment does not require that the court grant the requested relief to one of the parties where genuine issues of fact exist precluding summary judgment in favor of either party.' " State Farm Insurance Co. v. American Service Insurance Co., 332 Ill. App. 3d 31, 36 (2002), quoting Travelers Insurance Co. of Illinois v. Eljer Manufacturing, Inc., 307 Ill. App. 3d 872, 878 (1999). Our standard of review is de novo. SBC Holdings, 374 Ill. App. 3d at 8; Tefco, 357 Ill. App. 3d at 718. First Midwest first asserts that the trial court committed reversible error when it found that Hajyousif could invoke his fifth amendment privilege "on a blanket basis rather than determining such rights on a question-by-question basis" and thus "denied First Midwest access to critical evidence." At oral argument, First Midwest conceded it was not arguing that Hajyousif did not have a valid basis to assert his fifth amendment privilege, but rather, it simply was contesting the manner in which the trial court reviewed its motion to compel and ruled upon the scope of Hajyousif's privilege. Collectively, the appellees respond that First Midwest has waived any argument concerning Hajyousif's fifth amendment privilege because First Midwest failed to attach an affidavit pursuant to Rule 191(b) (210 Ill. 2d R. 191(b)) to any of its summary judgment pleadings. Alternatively, the appellees assert that the trial court properly found that Hajyousif

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1-06-3702 could invoke his privilege against self-incrimination on a blanket basis with respect to the Montreville Project. We initially address the appellees' waiver argument, to which First Midwest has failed to respond. Rule 191(b) permits a party filing pleadings pertaining to summary judgment or involuntary dismissal to submit an affidavit stating that material facts are known only to persons whose affidavits the affiant has been unable to secure by reason of hostility or otherwise. 210 Ill. 2d R. 191(b); Kane v. Motorola, Inc., 335 Ill. App. 3d 214, 224-25 (2002). A party that fails to attach a Rule 191(b) affidavit to its pleading to address its discovery need may not later seek reversal of the trial court's order on the basis that it was denied important discovery. See Kane, 335 Ill. App. 3d at 224-25 (finding that appellants waived their argument that the trial court abused its discretion in limiting the scope of discovery because they failed to attach a Rule 191(b) affidavit to their summary judgment pleadings); Intercontinental Parts, Inc. v. Caterpillar, Inc., 260 Ill. App. 3d 1085, 1090-91 (1994) (same); see also Lazar Brothers Trucking, Inc. v. A&B Excavating, Inc., 365 Ill. App. 3d 559, 565 (2006) (finding that a mechanic's lien claimant waived its argument pertaining to discovery because it failed to attach a Rule 191(b) affidavit to its response to the owner's motion to dismiss its lien claim). Here, during the discovery stage of litigation, First Midwest, AMEC, Reinke, Inland and Just Rite sought to depose Hajyousif, but he invoked his fifth amendment privilege against selfincrimination, thus preventing the parties from obtaining answers to questions pertaining to the Montreville Project. As a result, First Midwest filed a motion to compel Hajyousif to testify, which the trial court denied, as well as a motion to continue the proceedings, which the trial court

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1-06-3702 also denied. Thereafter, the parties filed cross-motions for summary judgment. First Midwest did not utilize Rule 191(b) to reassert its discovery need to oppose the appellees motions for summary judgment or to support its own motions for summary judgment. Accordingly, it may not now seek reversal of the trial court's summary judgment orders on the basis that Hajyousif's testimony was necessary to oppose the motions. Kane, 335 Ill. App. 3d at 224-35; Lazar, 365 Ill. App. 3d at 565; Intercontinental Parts, 260 Ill. App. 3d at 1090-91. Accordingly, First Midwest has waived this argument. Notwithstanding waiver, First Midwest's claim has no merit. The fifth amendment provides that "[n]o person *** shall be compelled in any criminal case to be a witness against himself." U.S. Const., amend. V; People v. Collins, 366 Ill. App. 3d 885, 892 (2006). The privilege against self-incrimination "is one of the most fundamental rights under the Constitution of the United States." CHB Uptown Properties, LLC v. Financial Place Apartments, LLC, 378 Ill. App. 3d 105, 108 (2007). This privilege, however, extends to only to witnesses who have a "reasonable cause to apprehend danger from a direct answer." Hoffman v. United States, 341 U.S. 479, 486, 95 L. Ed. 1118, 1124, 71 S. Ct. 814, 818 (1951). Although the privilege against self-incrimination must be liberally construed in favor of the witness asserting the privilege (People v. Brown, 303 Ill. App. 3d 949, 962 (1999)), the trial court must conduct a careful inquiry to determine whether the witness's fear of incrimination is reasonable, and if so, how far the privilege extends. Ohio v. Reiner, 532 U.S. 17, 149 L. Ed. 2d 158, 121 S. Ct. 1252 (2001); People v. Mileris, 103 Ill. App. 3d 589, 595 (1981). Specifically, "the court is required to conduct a hearing into whether a witness has `reasonable cause to apprehend danger from a direct answer.' " People v. Craig, 334 Ill. App. 3d 426, 446 (2002), quoting Hoffman, 341 U.S. at 486,

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1-06-3702 95 L. Ed. 2d at 1124, 71 S. Ct. at 818. A party in a civil case may invoke his privilege against self-incrimination to prevent the disclosure of information that could be used against him in a criminal proceeding. CHB Uptown, 378 Ill. App. 3d at 108. As a rule, when a witness in a civil case invokes his fifth amendment privilege during a deposition and the propriety of his invocation is subsequently challenged, "the trial court is obliged to scrutinize each disputed question and rule on the reasonableness of the [witness's] refusal to answer." 10-Dix Building Corp. v. McDannel, 134 Ill. App. 3d 664, 671 (1985); see also Galante v. Steel City National Bank of Chicago, 66 Ill. App. 3d 476, 482 (1978); People ex rel. Mathis v. Brown, 44 Ill. App. 3d 783, 787 (1976). However, "the propriety of invoking the privilege must be determined by the court when the question is presented to it in an appropriate fashion." Mathis, 44 Ill. App. 3d at 787. In 10-Dix, a defendant in a civil embezzlement action was deposed. After stating her name and address, she invoked the fifth amendment in response to all subsequent questions. 10Dix, 134 Ill. App. 3d at 667. The propriety of the defendant's privilege was subsequently challenged. Despite being presented with deposition questions, the trial court failed to "conduct a particularized review of the deposition questions, even though the record reflects that" such a review was requested. 10-Dix, 134 Ill. App. 3d at 671. We found that the trial court failure to conduct a question-by-question analysis was erroneous and remanded for further proceedings. 10-Dix, 134 Ill. App. 3d at 673. Similarly in Mathis, a defendant in a paternity action refused to answer questions at his deposition, citing the fifth amendment. The State presented the trial court with a copy of the

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1-06-3702 questions that the defendant had refused to answer and requested the trial court to compel the defendant to answer. The trial court reviewed some of the disputed questions, but "did not go through all of the questions which had remained unanswered." Mathis, 44 Ill. App. 3d at 785. Accordingly, we found that the trial court's procedure was "erroneous." Mathis, 44 Ill. App. 3d at 785. In this case, unlike the parties challenging a witness's invocation of the fifth amendment privilege in 10-Dix and Matthis, First Midwest did not continue to ask Hajyousif specific questions when he began to assert his privilege against self-incrimination. Instead, First Midwest's counsel merely asked if Hajyousif intended to assert the fifth amendment on a blanket basis with respect to various areas concerning the Montreville Project. Specifically, counsel queried: "Is it your intention to assert the Fifth Amendment on all questions relating to the structure or acts of Savannah, Inc.?" and "Is it your intention to assert the Fifth Amendment with respect to all matters involving yourself and the 520 North Halsted Street project?" and "Is it also your intention to assert the Fifth Amendment with respect to [CSI's] contracts for improvement to the property on both ends, both in terms of its relationship with the owner and with respect to its relationships with contractors?" First Midwest then filed a motion to compel, which the trial court denied. Although the record reveals that the trial court did not examine individual deposition questions, First Midwest failed to provide the trial court with a record that allowed for question-by-question review. Because First Midwest failed to ask specific questions of Hajyousif when he invoked his fifth amendment privilege, it may not now challenge the trial court's order denying its motion to compel on the grounds that the trial court failed to review Hajyousif's claim

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1-06-3702 on a question-by-question basis. Accordingly, because First Midwest failed to challenge the propriety of Hajyousif's invocation of his fifth amendment privilege in an appropriate manner, we find that the trial court did not err in denying First Midwest's motion to compel. In its reply brief, First Midwest asserts for the first time, that the trial court's order denying its motion to compel was also erroneous because Hajyousif waived his fifth amendment privilege by providing deposition testimony on November 21, 2003, in a separate, but related case. AMEC, Just Rite, and Reinke filed a surreply brief, which Inland and Stair One subsequently joined, and argued that we cannot review First Midwest's claim because First Midwest failed to include a copy of the deposition transcript in the record on appeal. Thereafter, we permitted First Midwest to file a sur-surreply brief and to supplement the record with the deposition transcript. The transcript reveals that during the November 2003 deposition, Hajyousif provided testimony concerning the relationship between CSI and Savannah in connection with a construction project undertaken at 6 North Michigan in Chicago. He acknowledged that he and Esmail were officers of CSI, that CSI was the general contractor on the 6 North Michigan project, and that CSI became "defunct" and money had not been paid to all of the subcontractors that provided work on that construction project. Initially, we note that First Midwest waived this argument by raising it for the first time in its reply brief. See 210 Ill. 2d. R. 341(h)(7) ("Points not argued are waived and shall not be raised in the reply brief"); Kulchawik v. Durabla Manufacturing Co., 371 Ill. App. 3d 964, 971 (2007). Moreover, because this deposition was never presented to the trial court, First Midwest cannot in

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1-06-3702 good faith argue that the trial court erred in denying its motion to compel on this basis. Nevertheless, we find First Midwest's waiver argument to be meritless. Although the fifth amendment privilege against self-incrimination can be waived (People v. Accardo, 195 Ill. App. 3d 180 (1990)), waiver of the privilege "is not lightly to be inferred" (Smith v. United States, 337 U.S. 137, 150, 93 L. Ed. 1264, 1274, 69 S. Ct. 1000, 1007 (1949)). Moreover, "the doctrine of waiver is limited to the particular proceeding in which the voluntary testimony is given." People v. Walker, 28 Ill. 2d 585, 588 (1963); see also Novak v. Rathnam, 106 Ill. 2d. 478, 484 (1985) (recognizing that the privilege against self-incrimination "attaches to the person in each case in which the person may be called to testify" and that a person who "testifies in one proceeding does not waive his right to invoke the self-incrimination privilege in a separate and independent proceeding"). Accordingly, a witness does not waive his right to invoke his fifth amendment privilege against self-incrimination at trial simply because he provided prior testimony before a grand jury in the same case (Craig, 334 Ill. App. 3d at 445-46) or because he provided testimony at a prior related trial (People v. Stufflebeam, 19 Ill. App. 3d 462, 463-64 (1974)). Keeping these principles in mind, we find that Hajyousif did not waive his right to invoke his fifth amendment privilege in this case when he provided deposition testimony in 2003. The deposition that First Midwest relies upon in support of its waiver argument was provided in a completely different case and was conducted approximately two years prior to the deposition in this case. Hajyousif's actions in providing testimony in a separate proceeding did not serve to waive his right to assert his fifth amendment privilege in this case. Walker, 28 Ill. 2d at 588-89;

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1-06-3702 Craig, 334 Ill. App. 3d at 445-46; Shufflebeam, 19 Ill. App. 3d at 463-64. In a related claim, First Midwest asserts the trial court, after denying First Midwest's motion to compel, further erred when it denied First Midwest's subsequent motion to continue the case until Hajyousif was available to testify. The appellees maintain the trial court properly denied First Midwest's motion to continue, filed pursuant to Supreme Court Rule 231 (134 Ill. 2d R. 231), because that rule only permits continuances during the trial phase of litigation not during discovery or summary judgment stages. Alternatively, the appellees contend that the trial court's order was proper because it was based on First Midwest's lack of due diligence in attempting to procure discovery from other sources. As a threshold matter, we need not decide whether First Midwest's motion to continue the case was properly filed under Supreme Court Rule 231 because " `[t]he nature of a motion is determined by its substance rather than its caption.' " Shutkas Electric, Inc. v. Ford Motor Co., 366 Ill. App. 3d 76, 81 (2006), quoting J.D. Marshall International, Inc. v. First National Bank of Chicago, 272 Ill. App. 3d 883, 888 (1995). Accordingly, we find the appellees' argument that the trial court's order should be upheld simply because First Midwest's motion was allegedly filed pursuant to the wrong rule to be unpersuasive, and we will thus address the merits of First Midwest's claim. As a general rule, the fact that a party involved in a civil proceeding invokes his fifth amendment privilege against self-incrimination "does not *** mandate a stay of [the] civil proceeding[] pending the outcome of similar or parallel criminal proceedings." Jacksonville Savings Bank v. Kovack, 326 Ill. App. 3d 1131, 1135 (2002); see also People ex rel. Hartigan v.

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1-06-3702 Kafka & Sons Building & Supply Co., 252 Ill. App. 3d 115, 119 (1993). The party seeking to stay the civil proceeding in which the fifth amendment has been invoked bears the burden of proving that a stay is appropriate. CHB Uptown, 378 Ill. App. 3d at 109. In considering whether to grant a stay, a court may consider various factors, including: (1) the procedural posture of the criminal case; (2) whether the criminal case involves the same subject matter as the civil case; (3) whether the government is a party to both cases; (4) the interests of the party invoking his fifth amendment privilege; (5) the interest of the public; (6) the prejudice to the plaintiff in not proceeding with the case; and (7) the interest of the court in managing its docket. CHB Uptown Properties, 378 Ill. App. 3d at 108-09; Jacksonville Savings, Ill. App. 3d at 1136. As a general rule, when no formal criminal charges have been brought against the individual asserting his fifth amendment privilege, "a stay is not normally appropriate" because it interferes with the court's ability to manage its docket. Jacksonville Savings, 326 Ill. App. 3d at 1137. Based on the facts in the record, we do not find that the trial court erred in denying First Midwest's motion for a continuance. Notably, First Midwest has not cited nor has it discussed the aforementioned relevant factors used to review a motion to continue trial court proceedings. 210 Ill. 2d R. 341(h)(7) ("Points not argued are waived"); Kulchawik, 371 Ill. App. 3d at 971-72. Accordingly, we need not conduct our own extensive review here. However, we do note that the record reveals that the trial court's order denying First Midwest's motion to compel was based, in part, on the fact that it was "troubled" that First Midwest had not attempted to depose other witnesses before seeking the continuance. Based on the trial court's finding that First Midwest lacked due diligence, we cannot say the denial of First

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1-06-3702 Midwest's motion amounted to error. See, e.g., Parker v. Newman, 10 Ill. App. 3d 1019, 1025 (1973) (a trial court does not err in denying a motion for a continuance if it finds that the movant failed to exercise due diligence in proceeding with the cause). In addition, we note that although evidence was presented that showed that Hajyousif was under federal investigation for his involvement in the Montreville Project at the time he asserted his fifth amendment privilege, he had not yet been formally charged. See Jacksonville Savings, 326 Ill. App. 3d at 1137, quoting Trustees of the Plumbers & Pipefitters National Pension Fund v. Transworld Mechanical, Inc., 886 F. Supp. 1134, 1139 (S.D.N.Y. 1995) (explaining that " `stays will generally not be granted before an indictment is issued' " because the trial court would essentially have to postpone the case indefinitely, thus burdening its ability to effectively manage and control its docket). Indeed, at oral argument, First Midwest conceded that because Hajyousif had not yet been charged it was essentially seeking to continue the case indefinitely. Based on these facts, we do not find that the trial court erred in denying First Midwest's motion for a continuance. We now address the specific arguments that First Midwest advances against each of the mechanic's lien claimants. At oral argument, First Midwest agreed that based on a review of the relevant appellees' contract formation dates as well as the recording date of the mortgage, the appellees' mechanic's lien claims would ordinarily have priority over its mortgage lien claim. See State Bank of Lake Zurich v. Winnetka Bank, 245 Ill. App. 3d 984, 990-93 (1993) (recognizing that the effective date of a mechanic's lien claim is the date of the contract, the effective date of a mortgage is the date the mortgage was recorded, and that priority between the two is determined based on a comparison of those dates). However, First Midwest maintains that based upon the

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1-06-3702 various arguments and defenses it asserted against the lien claimants in the trial court, the court erred in awarding summary judgment in favor of each of the mechanic's lien claimants. We will first address the arguments that First Midwest has asserted against AMEC. AMEC AMEC was the "construction manager" of the Montreville Project. AMEC's contract with Savannah, executed on February 4, 2000, provided that AMEC would provide construction management services, act as Savannah's agent, and specified that AMEC was "NOT a Constructor." After providing services pursuant to its construction management contract, AMEC recorded its mechanic's lien with the Cook County recorder of deeds on April 16, 2003, asserting a lien totaling $749,640.45 for work provided through March 31, 2003. AMEC subsequently recorded an amended mechanic's lien on June 27, 2003, asserting its right to a lien amounting to $929,468.82, reflecting work provided by AMEC through May 1, 2003. AMEC also filed a counterclaim in the circuit court on June 27, 2003, to foreclose its lien totaling $929,468.82 against Northstar, Savannah, CSI, CoVest, and other parties. In its counterclaim, AMEC alleged it entered into a contract with Savannah on February 4, 2000, to provide construction management services on the Montreville Project in exchange for a fee of 3.75% of the direct and indirect costs of work on the Project and that it was owed $929,468.82. AMEC's counterclaim also included breach of contract, unjust enrichment and quantum meruit claims against Savannah. After filing its counterclaim in the circuit court, AMEC subsequently recorded three additional amended mechanic's liens with the Cook County recorder of deeds. Specifically,

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1-06-3702 AMEC recorded an amended claim on August 13, 2003, and asserted a lien claim totaling $1,030,358.44 for work performed through June 30, 2003. Its next amended claim was recorded on September 23, 2003, and included a claim for $1,173,926.44, reflecting work provided through August 31, 2003. AMEC's final amended lien claim was recorded on November 17, 2003, and sought to recover $1,318,965.72 for work performed through October 31, 2003. After AMEC recorded its final mechanic's lien with the Cook County recorder of deeds, it filed an amended counterclaim to foreclose its lien in the circuit court on December 10, 2003, reciting the same charges made in its original counterclaim and seeking to foreclose its mechanic's lien, which now totaled $1,318,965.72. Thereafter, AMEC filed a motion for summary judgment and turnover of funds. Citing the trial court's two prior orders entering summary judgment against Northstar, Savannah, and CSI, and finding that AMEC's mechanic's lien had priority over First Midwest's mortgage lien, AMEC asserted it was entitled to summary judgment because "there is no dispute of fact over the allegations in AMEC's counterclaim and *** AMEC has a first priority lien over the property." Accordingly, AMEC urged the trial court to enter judgment in its favor in the amount of $1,318,965.72. Attached to AMEC's motion were a number of exhibits including several affidavits. James Ladd, a project executive at AMEC, submitted an affidavit in which he averred that AMEC entered into a construction management contract with Savannah but that, during the course of the contract, AMEC was also "forced to fulfill the typical day-to-day duties and responsibilities of a general contractor" because CSI, the named general contractor, "did not have any presence on the

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1-06-3702 Project on a day to day basis." Accordingly, Ladd stated that AMEC employed project managers, superintendents, carpenters, and laborers. AMEC also submitted an affidavit completed by Michael Gora, AMEC's senior project manager on the Montreville Project, who confirmed that AMEC was hired as the construction manager but was forced to fulfill the role of the general contractor due to CSI's lack of presence on the Project. Gora averred that AMEC supervised, directed, and coordinated the work on the Project, inspected work and rejected defective work, and reviewed and made recommendations concerning change order requests. AMEC also affixed the affidavit of Lisa Romanelli, AMEC's territory controller, who stated that AMEC did not receive payment for "any of the work it performed on the Project from November 2002 through October 2003" and verified that "there remains due and owing to AMEC an amount in excess of $1,318,965.72." In response to AMEC's motion and in support of its own cross-motion for summary judgment, First Midwest argued that AMEC was not a "contractor" as defined by the Act because its contract with Savannah designated AMEC as the "construction manager" of the Project and identified AMEC as Savannah's "agent." First Midwest also contended that even if AMEC did provide lienable work, including general contracting services and labor, the lienable work it provided was insignificant, and AMEC's failure to allocate between the lienable and nonlienable work it provided on the Project was fatal to AMEC's claim. Moreover, First Midwest maintained that AMEC's inclusion of nonlienable material in its lien claim amounted to constructive fraud. First Midwest did not, however, attach any affidavits rebutting those submitted with AMEC's motion.

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1-06-3702 In addition to its cross-motion, First Midwest also filed a motion for partial summary judgment as to amount against AMEC. First Midwest, citing section 7 of the Act, asserted that AMEC's amended lien claims could not be asserted against First Midwest due to its status as a third-party incumbrancer of the property. Accordingly, First Midwest maintained that in the event AMEC's mechanic's lien was entitled to priority, its recovery amount was limited to $749,640.45, the sum identified in its first recorded mechanic's lien claim. After reviewing the pleadings submitted by both parties, the trial court granted AMEC's motion for summary judgment and denied First Midwest's cross-motion, stating, "having considered the Briefs and having heard oral argument, it is hereby ordered: [1.] The motion for summary judgment of AMEC Construction Management, Inc. is granted. First Midwest's Crossmotion for summary judgment is denied. [2.] AMEC is entitled to and awarded a valid and subsisting mechanics lien in the amount of $1,318,965.72 together with statutory interest at the rate of 10% per annum and costs." The trial court also denied First Midwest's partial motion for summary judgment as to amount. On appeal, First Midwest disputes the trial court's findings. Initially, First Midwest maintains that the trial court improperly granted summary judgment in favor of AMEC because AMEC is not a "contractor" as defined by the Act because its contract did not call for AMEC to provide lienable services. First Midwest's claim is premised on the fact that AMEC is identified as a "construction manager" and "agent" of the owner in its contract with Savannah, and accordingly, based on this language, the contract did not call for AMEC to provide lienable work under section 1 of the Act (770 ILCS 60/1 (West 2006)).

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1-06-3702 The Act is a comprehensive statutory enactment that outlines the rights, responsibilities, and remedies of parties to construction contracts, including owners, contractors, subcontractors, and third parties. Lazar Brothers Trucking, Inc., v. A&B Excavating, Inc., 365 Ill. App. 3d 559, 562 (2006); Struebing Construction Co. v. Golub-Lake Shore Place Corp., 281 Ill. App. 3d 689, 694 (1996). Its overall purpose is " `to require a person with an interest in real property to pay for improvements or benefits which have been induced or encouraged by his or her own conduct.' " Stafford-Smith, Inc. v. Intercontinental River East, LLC, 378 Ill. App. 3d 236, 240 (2007), quoting Levyfilm, Inc. v. Cosmopolitan Bank & Trust, 274 Ill. App. 3d 348, 352 (1995). A party's status as a "contractor," as this term is defined by the Act, is significant because contractors are entitled to assert liens under the Act. 770 ILCS 60/1(a) (West 2004); Candice Co. v. Ricketts, 281 Ill. App. 3d 359, 362 (1996). Because the right to a mechanic's lien is statutory, however, "a contractor must strictly comply with the Act to be eligible for relief." Matanky Realty Group, Inc. v. Katris, 367 Ill. App. 3d 839, 841 (2006); see also Tefco Construction Co., Inc. v. Continental Community Bank & Trust Co., 357 Ill. App. 3d 714, 719 (2005) (recognizing that "[w]hile the Act should be construed liberally as a remedial one, being in derogation of common law, it is strictly construed with reference to the requirements upon which the right to a lien depends"). One basic requirement for a party seeking to assert a mechanic's lien under the Act as a contractor is to meet the statutory definition of this term. 770 ILCS 60/1 (West 2006). The term "contractor" is defined in section 1 of the Act. 770 ILCS 60/1 (West 2006). Pursuant to a recent amendment, (Pub. Act 94-627, eff. January 1, 2006), section 1 of the Act

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1-06-3702 was modified and currently defines the term "contractor" as "[a]ny person who shall by any contract or contracts, express or implied, or partly expressed or implied, with the owner of a lot or tract of land, or with one whom the owner has authorized or knowingly permitted to contract, to improve the lot or tract of land *** or to manage a structure under construction thereon." (Emphasis added.) 770 ILCS 60/1(a) (West 2006). As a threshold matter, First Midwest maintains that because the phrase "to manage a structure under construction thereon," was added to section 1 by virtue of the recent amendment, AMEC may not rely upon this provision to assert a mechanic's lien because its construction management contract was formed in 2000, "long before this provision took effect." Accordingly, First Midwest asserts that because the Act, as it existed at the time AMEC entered into its contract, did not define a contractor as a party that contracted to "manage a structure under construction thereon," AMEC is not a contractor and its contract did not call for AMEC to provide lienable services under the Act. First Midwest misreads the nature of the change effectuated by the amendment. Prior to the 2006 amendment, section 1 of the Act provided: "Any person who shall by any contract or contracts, express or implied, *** with the owner of a lot or tract of land, *** to improve the lot or tract of land or to manage a structure thereon, or to furnish material, fixtures, apparatus or machinery *** or perform any services or incur any expenses as an architect, structural engineer, professional engineer, land surveyor or property manager in, for or on a tract of land for any such

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1-06-3702 purpose *** is known under this Act as a contractor, and has a lien upon the whole of such lot or tract of land." (Emphasis added.) 770 ILCS 60/1 (West 2004). Accordingly, the 2006 amendment did not, as First Midwest claims, "add contracts `to manage a structure under construction thereon' to the list of lienable contracts under section 1 of the Act." Rather, Public Act 94-627 simply added the phrase "under construction thereon" to the preexisting phrase "manage a structure."2 Though no cases are directly on point, several cases have implicitly recognized the right of construction managers to assert mechanic's liens under the prior version of the Act. See Contract Development Corp. v. Beck, 255 Ill. App. 3d 660, 669 (1994) (suggesting in dicta that a lien claimant who was retained as a construction manager and performed preconstruction services could assert a lien claim as a property manager under the Act); see also Northwest Millwork Co. v. Komperda, 338 Ill. App. 3d 997, 1003 (2003) (reversing a trial court order dismissing an action brought by a party retained to provide construction management services to foreclose a mechanic's lien under the Act and ordering further consideration of the construction manager's claim). First Midwest's argument that AMEC is not a contractor is thus premised on an incorrect reading of the statute and the recent amendment. Here, there is no dispute that AMEC signed a contract to provide construction management services on the Montreville Project and manage the construction of the condominium complex. AMEC thus meets the Act's definition of a contractor, which at the time AMEC formed its contract, defined the term as one with a contract
2

The phrase "manage a structure" was added to the Act by Public Act 84-702 (Pub. Act 84-702, eff. September 20, 1985). 27

1-06-3702 to "manage a structure." 770 ILCS 60/1 (West 2004). Our conclusion that AMEC is a contractor is supported not only by a plain language of the statute, but also by the legislative history of the recent amendment, which reveals that the overall purpose of the amendment was to provide much-needed clarification to the Act. A subsequent statutory amendment may be an appropriate source to determine legislative intent. Knolls Condominium Ass'n v. Harms, 202 Ill. 2d 450, 461-62 (2002); People v. Parker, 123 Ill. 2d 204, 211 (1988). In cases where the legislative history indicates that an amendment is intended as a clarification of existing law, it may be interpreted and applied as such. See, e.g., In re Detention of Lieberman, 201 Ill. 2d 300, 322-23 (2002), quoting 91st Ill. Gen. Assem., House Proceedings, March 3, 2000, at 192 (statement of Rep. Turner) (finding that an amendment to the Sexually Violent Persons Commitment Act was intended to be a clarification based, in part, on the comments of the House sponsor of the bill who indicated that the bill contained "cleanup language"); Jacobson v. General Finance Corp., 227 Ill. App. 3d 1089, 1097 (1992), quoting 87th Ill. Gen. Assem., Senate Proceedings, May 22, 1991, at 245 (statement of Sen. Jacobs) (finding that the amendment to the Illinois Interest Act was intended as a clarification based in part on comments by Senator Jacobs, who stated: "This bill, as amended, *** clarifies that the prepayment section of the Interest Act [citation] does not apply to the installment loan rate"). Here, Public Act 94-627 was introduced to the Illinois legislature as Senate Bill 1930. In addressing members of the House of Representatives, Representative George Scully stated: "For those of you who have had the misfortune of trying to read this piece...this statute [the Mechanics Lien Act], it's very confusing. The...it has been a patchwork of quilts...of

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1-06-3702 patches put on this quilt over the past hundred years. This Bill attempts to clarify the language without making significant substantive changes other than changes necessary to codify existing case law, giving people who are reading the Mechanics Lien Statute the ability to simply read the statute and also at the same time to get an understanding and a statement of what the existing case law is interpreting this very old statute." (Emphasis added.) 94 Ill. Gen. Assem., House Proceedings, May 31, 2005, at 17-18 (statement of Rep. Scully). Representative Scully's statements explaining that the overall purpose of the amendment to the Act was to provide clarification thus provides further support that AMEC's construction management contract called for the provision of lienable services and that AMEC is a contractor as this term is defined by section 1 of the Act. First Midwest, however, cites to Oakley v. Crawford Electric, Inc., Nos. 2005-CA001471-MR, 2005-CA-001487-MR (Ky. App. October 6, 2006) and Shively v. Bellville Township High School District No. 201, 329 Ill. App. 3d 1156 (2002), where courts found that parties that signed construction management contracts were not contractors. However, neither of these cases addressed a construction management contract in the context of the Act, and, accordingly, neither is persuasive. Oakley, slip op. at 1-2 (finding that a construction manager did not meet the definition of a contractor as defined by the Kentucky Workers' Compensation Act); Shively, 329 Ill. App. 3d at 1160 (discussing the differences between contractors and construction managers in the context of the bidding requirements of the Illinois School Code). First Midwest nonetheless also asserts that AMEC is not a contractor under section 1 of

29

1-06-3702 the Act because the construction management contract identified AMEC as Savannah's "agent" and specified that AMEC did not assume responsibility for the subcontractors. Notably, First Midwest cites no authority that an agency relationship precludes a finding that a party is a contractor under the Act. 210 Ill. 2d R. 341 (h)(7) (arguments raised on appeal must be supported "with citation of the authorities and the pages of the record relied on"); Golf v. Henderson, 376 Ill. App. 3d 271, 280 (2007). In addition, this term is used in the contract to clarify AMEC's role with respect to third parties who provided work on the Project, not to alter AMEC's construction management duties. Finally, we note that First Midwest's argument finds no support in the Act because section 1 expressly provides that "any person" who contracts with an owner to "manage a structure" is a contractor. 770 ILCS 60/1 (West 2006). There is no agency exception. We note however, that although AMEC's contract called for the provision of construction management services, there is no dispute that AMEC, in effect, assumed the role of the general contractor on the Project. Specifically, James Ladd, AMEC's project executive, and Michael Gora, AMEC's senior project manager, submitted affidavits in which each averred that although AMEC entered into a construction management contract with Savannah, AMEC was ultimately required to also provided general contracting services on the Project because CSI, the named general contractor, did not maintain a presence on the Project. According to Ladd and Gora, AMEC was thus required to provided additional services "above and beyond those set forth" in the contract, including "day-to-day construction sequencing, coordination, supervision, direction or control" on the Project, as well as carpentry work, minor demolition, cleanup, and hand

30

1-06-3702 excavation. Ladd acknowledged at his deposition that AMEC provided these services even though its construction management contract had not been amended or altered in any way to include the provision of any of these services. First Midwest submitted no affidavits contradicting those provided by Ladd and Gora detailing the nature of the services that AMEC provided on the Project, and accordingly, we must accept their statements as true. Central Illinois Light Co. v. Home Insurance Co., 213 Ill. 2d 141, 170-71 (2004); F.H. Paschen/S.N. Nielsen, Inc. v. Burnham Station, L.L.C, 372 Ill. App. 3d 89, 93 (2007). Nonetheless, First Midwest maintains that AMEC is not entitled to recover for the lienable work it provided as a general contractor because "such work was necessarily pursuant to an agreement other than the [construction manager] contract because, as Ladd testified, the [construction manager] contract was never modified." Accordingly, "to the extent that work was done under another agreement, it was not described in any of AMEC's recorded lien claims," and as a result, pursuant to section 7 of the Act (770 ILCS 60/7 (West 2006)), First Midwest asserts that AMEC's lien claim is invalid because it incorrectly described the contract pursuant to which AMEC asserted its lien. To properly perfect a lien claim against either an owner or a third party, a mechanic's lien claimant must "comply with the prerequisites in section 7 of the Act." Tefco, 357 Ill. App. 3d at 719; see also Federal Savings & Loan Insurance Corp. v. American National Bank & Trust Co. of Chicago, 115 Ill. App. 3d 426, 428 (1983). Section 7 requires a lien claimant seeking to assert a lien claim against a third party such as a "creditor or incumbrancer or purchaser" to file a claim within four months of its completion date that contains "a brief statement of the [claimant's]

31

1-06-3702 contract." 770 ILCS 60/7 (West 2006); see also Tefco, 357 Ill. App. 3d at 719. A lien claim that contains an incorrect description of the contract for which the lien is asserted is invalid. See, e.g., Candice, 281 Ill. App. 3d at 364 (lien claim that incorrectly named the parties to the contract was invalidated because it contained an incorrect description); Ronning Engineering Co. v. Adams Pride Alfalfa Corp., 181 Ill. App. 3d 753 (1989) (lien claim was invalidated because the claim reflected that the lien was based upon a verbal contract formed in 1985 when it was actually based upon a written contract executed in 1986). Here, unlike the lien claimants in Candice and Ronning, there is no evidence that AMEC provided an incorrect description of the contract pursuant to which it asserted a lien claim. The record reveals that at all times AMEC provided services pursuant to a single contract, the construction management contract. Although AMEC provided services above and beyond that which was provided for in that contract, we do not find that AMEC's claim should be defeated on this basis because Ladd's and Gora's uncontradicted affidavits established that AMEC's performance of the additional work was necessary to effectively manage the Project due to CSI's failure to fulfill its role as the general contractor of the Montreville Project. First Midwest nonetheless asserts that AMEC's lien claim must fail for various other reasons. Specifically, First Midwest maintains that AMEC failed to allocate any lienable work it performed from the nonlienable work it provided and that its failure to do so necessarily invalidates AMEC's lien claim. First Midwest is correct that under Illinois law, "[l]ienable work must be separable from nonlienable work and the total amount due must be apportionable or the entire lien is defeated."

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1-06-3702 Flader Plumbing & Heating Co. v. Callas, 171 Ill. App. 3d 74, 77 (1988); see also BRL Carpenters, Ltd. v. American National Bank & Trust Co., 126 Ill. App. 3d 137, 142 (1984). In this case, First Midwest asserts that AMEC's lien includes nonlienable work and thus its claim must fail. Specifically, First Midwest maintains that AMEC's fee, which James Ladd, AMEC's project executive, stated in his deposition represented "compensation for profit and overhead," is not lienable because profit and overhead alone are not lienable under section 1 of the Act. First Midwest, however, fails to cite to any authority to support its claim, and accordingly, we deem it waived. 210 Ill. 2d R. 341(h)(7); Golf, 376 Ill. App. 3d at 280. Moreover, there is nothing inherently unlienable about fees, as contractors have been permitted to assert liens for fees provided for in a construction contract. See, e.g., Blohm v. Kagy, 341 Ill. App. 468, 472 (1950) (finding that party was entitled to a mechanic's lien that included costs as well as the 10% fee provided for in the contract). Accordingly, we find that First Midwest's argument that AMEC's claim must be defeated due to its failure to allocate between lienable and unlienable work is without merit. In a related claim, First Midwest maintains that AMEC's inclusion of its fee in its mechanic's lien claim resulted in constructive fraud and accordingly AMEC's lien claim must fail. The Act provides that a mechanic's lien claim will not "be defeated to the proper amount thereof because of an error or overcharging on the part of any person claiming a lien therefor under this Act, unless it shall be shown that such error or overcharge is made with intent to defraud." 770 ILCS 60/7 (West 2006). When a lien claimant knowingly records a lien that contains a substantial overcharge, its claim will be defeated on the basis of constructive fraud.

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1-06-3702 See, e.g., Lohmann Golf Designs, Inc. v. Keisler, 260 Ill. App. 3d 886, 891 (1994); Fedco Electric Co. v. Stunkel, 77 Ill. App. 3d 48, 51 (1979); Marsh v. Mick, 159 Ill. App. 399, 405-06 (1911). In this case, First Midwest maintains that "[e]ven if some of the services furnished by AMEC are lienable, over 34% of AMEC's claim is its fee that clearly is non-lienable profit and overhead. AMEC's inclusion of its fee in its lien claim alone renders the claim constructively fraudulent." However, because we found that First Midwest failed to establish that AMEC's fee is inherently unlienable, AMEC's inclusion of its fee in its lien claim is not erroneous and does not amount to constructive fraud. Accordingly, First Midwest's constructive fraud argument has no merit. We now address First Midwest's final argument, that pursuant to section 7 of the Act, AMEC's amended claim is not enforceable against First Midwest due to its undisputed status as a third-party incumbrancer of the property. In addition to setting forth the substantive requirements of a valid mechanic's lien claim, section 7 also details strict procedural requirements that a lien claimant must abide by to assert a valid lien claim, which vary depending upon the type of party against whom the lien claimant seeks to assert its lien. 770 ILCS 60/7 (West 2006); Stafford-Smith, 378 Ill. App. 3d at 240-41. With respect to third parties such as "creditor[s] or incumbrancer[s] or purchaser[s]" of the property, a lien claimant must record its claim within four months after the completion of its work. 770 ILCS 60/7 (West 2006); Stafford-Smith, 378 Ill. App. 3d at 241. In contrast, when a lien claimant seeks to enforce a mechanic's lien against an owner, the claimant has two years

34

1-06-3702 following the completion of its work to record its lien. 770 ILCS 60/7 (West 2006); StaffordSmith, 378 Ill. App. 3d at 241. In addition, section 7 provides that a lien claim "as to such owner may be amended at any time before the final judgment." 770 ILCS 60/7 (West 2006); Federal Savings, 115 Ill. App. 3d at 428. Relying on our prior holding in Federal Savings, First Midwest, an undisputed third-party incumbrancer, asserts that the absence of language in section 7 permitting amendments against third parties prohibits AMEC from asserting its amended mechanic's lien claim against it. In Federal Savings, a contractor recorded its mechanic's lien claim on January 14, 1980, which identified September 26, 1979, as its completion date, and then recorded an amended claim on October 27, 1980, this time citing January 10, 1980, as its completion date. The amended claim attempted to correct various errors in the original claim including the contract formation date and the contract purpose. The trial court granted the third-party lender's motion for summary judgment, finding that its mortgage lien had priority over the contractor's mechanic's lien. The contractor appealed, asserting that its lien claim could be amended after the statutory filing period has expired because an amendment relates back to the date of the filing of the original claim and further asserting that section 7's provision allowing amendment "at any time before the final judgment" as applied to "owners" should also be extended and applied to third parties. Federal Savings, 115 Ill. App. 3d at 427-28. We disagreed that section 7 allowed amended lien claims to be asserted against third parties, stating: "By explicitly providing for amendments to lien claims against owners, under the

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1-06-3702 traditional rule of statutory construction the statute implicitly precludes amendments as to all other parties. Thus [the contractor's] attempted amendment to its lien claim against and to the prejudice of plaintiff, an undisputed third-party encumbrancer, is not permitted under the Act. [Citation.] Moreover, were we to accept [the contractor's] argument that mechanic's lien claims may be amended as to all parties despite apparent legislative intent to the contrary, [it's] lien claim fails nonetheless because its amendment was filed after the [four-month] statutory period expired." Federal Savings, 115 Ill. App. 3d at 428-29. AMEC, however, maintains that First Midwest interprets Federal Savings too broadly and that our previous

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