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NO.

84-259

I N THE SUPREME COURT OF THE STATE OF MONTANA

1984

SIE4KINS-HALLIN

LUMBER CO!,IPANY, P l a i n t i f f and R e s p o n d e n t ,

MARTHA S IblONSON , D e f e n d a n t and A p p e l l a n t ,

and
ED BAREFIELD d / b / a BEAR CONSTRUCTION; EMPIRE FEDERAL SAVINGS & LOAN ASSOC. O F L I V I N G S T O N ; and !IANHATTAN STATE BANK, Defendants.

MARTHA SIMONSON , Cross-Plaintiff

and A p p e l l a n t ,

ED B A R E F I E L D , Cross-Defendant

and R e s p o n d e n t .

APPEAL FROM:

D D i s t r i c t C o u r t of t h e E i g h t e e n t h ~ u d i c i a l i s t r i c t , I n and f o r t h e C o u n t y of G a l l a t i n , T h e H o n o r a b l e F r a n k D a v i s , Judge p r e s i d i n g .

COUNSEL O F RECORD: For Appellant:

K.

A.

Bolinger,

B o z e m a n , Montana

For R e s p o n d e n t :

Morrow,

Sedivy

& Bennett,

B o z e m a n , Montana

S u b m i t t e d on B r i e f s : S e p t . 2 7 , D e c i d e d : ilecenber 11, 1 9 8 4

1984

Clerk

Mr. Justice L. C. Gulbrandson delivered the Opinion of the Court. Martha Eighteenth Simonson Judicial appeals from Court, a judgment of of the

District

County

Gallatin,

ordering foreclosure of a materialmans' lien against her and awarding Simkins-Hallin Lumber Company costs and attorney's fees. We affirm the judgment of the District Court. The facts of this case are not at issue. The

appellant, Martha. Simonson, entered into an oral agreement with Ed addition Rarefield, d/b/a Bear Construction, to build to her house in Belgrade, Montana. At an her

deposition, Simonson asserted that the agreement contemplated a 528 square foot addition at the contract price of $28 per square foot, for a total price of $14,784. Barefield

obtained certain materials used in the construction of the addition at Simkins-Hallin Lumber Co., the plaintiff and These materials, valued at $888.36, Simonson paid Rarefield a total of

respondent in this case. were never paid for.

$16,300 for his services, the last payment having been made on September
3,

1982.

A.t that time

Barefield

claimed However,

Sirnonson still owed him $1,000 under the contract. no further payments were made. On September 22, 1982, Simkins-Hallin

filed

a

materialmans' lien with the county clerk and recorder as required by section 71-3-511, MCA.

A certification of notice

of lien to Simonson, as property owner, was attached to the filed lien, pursuant to section 71-3-513(2), MCA. The

certification specified that a notice of the lien had been mailed to Simonson on September 23, 1982, one day later than the filing date of the lien and the certification. Attempts to settle the matter failed, and on March 30, 1983, Simkins-Hallin filed a complaint seeking enforcement of

the lien as well as costs and attorney fees.

Cross motions

for summary judgment were filed, and on November 10, 1983, the court issued its findings and conclusions wherein

Simkin-Hallin's motion was granted. a valid mechanics' lien had

The court concluded that established although,

been

contrary to section 71-3-513 (2), MCA, the notice to Simonson was mailed one day after the lien was filed. The court a.lso

awarded Simkins-Hallin costs and attorney fees, which were later set at $872.45. Final judgment against Simonson

ordering foreclosure of the lien and payment of costs and attorney fees to Simkins-Hallin was entered on March 28,
1984.

Simonson appeals from that judgment. The appellant's principal issue on appeal is whether,

as a matter of law, it was error for the trial court to

uphold the lien filed by respondent despite a discrepancy in the attached certificate of notice, which reads as follows: "The undersigned hereby certifies that he mailed and [sic] true and correct copy of the Notice of Claim of Lien upon the claimant therein named at the address of: Martha Simonson 107 Madison Belgrade, Montana 59714 by mailing the sane in an envelope with postage prepaid on the 23rd day of September, 1982. " The lien and certificate were filed on September 22, 1982. It is therefore manifest that despite the use of the past tense in the language employed on the certificate, the notice
of lien was not mailed until one day after the lien itself

was filed by the clerk. Appellant argues that under section 71-3-513(2), MCA, the lien should not have been filed by the clerk because the mailing date specified on the certificate of notice was one

da.y later than the filing date of the lien.

In pertinent

part, section 71-3-513(2), MCA provides as follows: "The clerk shall not file the lien unless there is attached thereto a certification by the lien claimant or his agent that a copy of the lien has been served upon each owner of record of the property named in the lien." Section 71-3-513(2) was added to the mechanics' lien statutes by legislative amendment in 1981, and has not been interpreted by this Court. However, we agree with appellant

that the rule in Montana regarding the interpretation of the lien statutes has been that:

" [TIhe requirements of the mechanics ' lien statutes as to procedure will be strictly enforced. Once the procedure has been fulfilled, the statutes will be liberally construed so as to give effect General to their remedial character. " Electric Supply Co. v. Bennett (Mont 1981), 626 P.2d 844, 846, 38 St.Rep. 553, 555-556.

.

In this case it is uncontested that, except for the fact that the notice to the a-ppellant was mailed one day late, the respondent lumber company diligently followed the procedural requirements necessary to perfect a mechanics' lien under Montana statute. The question to be addressed is

whether a minor technical violation of section 71-3-513 ( 2 ) , MCA, must void an otherwise meritorious and valid lien. In this regard, it is instructive to review holdings from other jurisdictions faced with similar problems in

interpreting their notice of lien statutes. In Las Vegas Plywood v. D 649 P.2d
&

D Enterprises (Nev. 1982) ,

1367, the Nevada Supreme Court refused to void a

mechanics' lien when the lienor failed to post a notice of the lien as required by statute. Although Nevada had

previousby recognized a "strict compliance" rule regarding its mechanics' lien statutes, Fisher Brothers, Inc. v. Harrah

Realty Co., (Nev. 1976), 545 P.2d 203, the court found that substantial compliance with the requirements of the notice of lien statute would suffice where the property owner received actual notice and was not prejudiced by the failure to

strictly comply with the statute. P.2d at 1368. And in Peterman-Donnelly

- Vegas Plywood, 649 Las

Engineers

and

Contractors

Corp. v. First National Bank (Ariz.App. 1965), 408 P.2d 841, a lienor failed to attach a copy of a written contract

between itself and the property owner to its notice of lien, contrary to Arizona statute. However, the principal terms of Additionally, the

the contract were recited in the notice.

lienor served a copy of the lien on the agent of the owner, rather than required. on the owner himself as the notice statute

The court ruled that "substantial compliance not the legislative purpose" was sufficient

inconsistent with

where the material terms of the contract were recited in the notice, and actual notice was received without any prejudice to the interest of the owner. 843-44. Peterman-Donnelly, 408 P.2d at

We note that prior to Peterman-Donnelly, Arizona,

too, had required strict accordance with the mechanics' lien statute in order to perfect a lien. 1956), 302 P.2d 534, 538. In Oregon, a notice of lien was found to be sufficient, and the lien upheld, where the notice was not sent by Laro Irwin v. Murphey (Ariz.

registered or certified mail as required by statute.

Lumber Company, Inc. v. Patrick (0r.App. 1981), 630 P.2d 400. The Oregon court stated that: "The obvious purpose of the requirement that notice of an intent to foreclose a lien must be given to the property owner is to give the owner an opportunity, prior to the commencement of the suit, to pay the lien and to prevent liability for

costs and disbursements attorney's fees.

including

"Here the purpose was served. Defendant had actual notice that a lien had been filed and had an opportunity to challenge it or pay the lien and prevent liability for costs and attorney fees recoverable under O.R.S. 87.060." Laro Lumber Co., 630 P.2d at 403. The court concluded that there had been substantial compliance with the statutory notice requirements, Laro, 630 P.2d at 403, although Oregon had formerly observed the rule that the mechanics' lien statutes must be strictly followed regarding their procedural requirements. Anderson v.

Chambliss (Or. 1953), 262 P.2d 298, 300. In addition we note that New Mexico, GarrettBuilding Centers, Inc. v. Hale (N.M. 1981), 623 P.2d 570, 573-74, and (Ill.~pp. 1977), liens

Illinois, Lundy v. Boyle Industries, Inc. 361 N.E.2d despite 321, 323, have technical

also upheld mechanics' of the

minor

violations

procedural

requirements of the lien statutes.

See also Layrite Products

Company v. Lux (Idaho 1964), 388 P.2d 105, 108-109; Jack Endo ~lectric,Inc. v. Lear Siegler, Inc. (Hawaii 1978) , 585 ~ . 2 d

The

common

thread

running

through

all

of

these

decisions is that an otherwise valid mechanics' lien should. not be defeated where the lienor has substantially complied with statutory procedural requirements, where notice was

actually given, and where no prejudice to the property owner has arisen due to the lienor's technical error. In the case now before us, the appellant a.dm.itsthat she received actual notice in due course. The record

indicates that appellant had six months between the date of actual notice and the date when the complaint was filed on

the lien to settle or pay the lien and thereby avoid payment of costs and attorney fees. And it is clear that the late

filing of the notice did not cause the a.ppellant to pay the same bill twice, because she had already made her last

payment to the contractor on September 3, 1982, nineteen days before the lien was filed. Because the appellant received

actual notice and was not prejudiced in any manner by the respondent's technical error, and because the respondent

lumber company substantially complied with the procedural requirements of section 71-3-513(2), MCA, we conclude that the trial court correctly sustained the respondent's lien. The appellant also maintains that she should not be required to pay attorney fees to respondent as ordered by the District Court. This argument is apparently based on the

fact that appellant attempted in good faith to settle the cla.im of lien prior to the court's ruling on the motion for summary judgment. Section 71-3-124, MCA provides as follows: "In an action to foreclose any of the liens provided for by parts 3, 4, 5, 6, 8, or 10 of this chapter, the court must allow as costs the money paid for filing and recording the lien and a reasonable attorney's fee in the district and. supreme courts, and such costs and attorneys' fees must be allowed to each claimant whose lien is established, and such reasonable attorneys' fees must be allowed to the defendant against whose property a lien is claimed, if such lien be not established." Here, the claimant has established a lien, and by statute the District Court was required to allow reasonable attorney fees. Upon review, we are limited to determining whether the

trial court's award of attorney fees constituted a clear abuse of discretion. Luebben v. Pletlen (1940), 110 Mont. In its order fixing attorney Court substantially reduced

350, 355, 100 P.2d 935, 937. fees at $800, the District

plaintiff-respondent's claimed attorney fees of $2,648.75. Under the circumstances, we find no abuse of discretion

regarding the amount of attorney fees awarded. Upon appeal, however, respondent has requested further attorney fees of $1,285 citing section 71-3-124, MCA, quoted above. We are reluctant to grant additional attorney fees in

a case where the amount in controversy totalled only $888,

and where the trial judge, having considered. the evidence, has already reduced the respondent's claimed fees by over $1,800. However, the language of section 71-3-124, MCA is

mandatory, and for that reason this matter is remanded to the District Court for further proceedings to establish

respondent's reasonable attorney fees incurred in defending this appeal. The judgment of the District Court is affirmed, and the matter is remanded for further proceedings regarding

We concur:

4
Justice

Chief Jusvife

4



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