June 13, 2016
By: Len Toenjes, President, AGC of Missouri
AGCMO Helps Gain Mechanic’s Lien Victory for Contractors
An important legal victory for Missouri contractors was finalized on June 8. That’s when motions for rehearing or transfer to the Missouri Supreme Court of the Crafton and Vogel vs. Swenson, Allen Edmonds and Plaza Frontenac mechanic’s lien case were both denied. This case is now settled with a unanimous (3-0) decision in favor of the contractors.
Because of the importance of protecting the enforcement and integrity of mechanic’s liens in Missouri, the AGC of Missouri filed an amicus brief in support of the Appellants, Crafton and Vogel, and also provided legal assistance.
As background, the case involved work performed on retail space at Plaza Frontenac by Crafton Contracting Company and Vogel Sheet Metal & Heating, Inc. (Crafton is a member of the AGC of Missouri.) for an Allen Edmonds shoe store. Swenson Construction Company, Inc. was selected as general contractor for the $207,398.40 project and subcontracted demolition, framework, drywall, carpentry, and barricade work to Crafton for $67,023.00, and $15,975.00 to Vogel for HVAC. Both contractors completed their work. Allen Edmonds paid Swenson in full, but Swenson never paid Crafton and Vogel for their work. Swenson went out of business in 2013.
Crafton and Vogel both filed mechanic’s liens against Plaza Frontenac, Allen Edmonds and Swenson Construction, and filed suit to enforce those liens. The initial trial court entered a judgment in which it found that Crafton and Vogel’s liens were unenforceable against Plaza Frontenac because Crafton and Vogel failed to establish that Allen Edmonds was Plaza Frontenac’s agent under the mechanic’s lien statute. The contractors then successfully appealed that earlier decision. On June 8, the Missouri Court of Appeals made its final ruling on the case, denying a transfer or rehearing of the case.
The ramifications of this case are significant for the following reasons:
1.
Owners/landlords are responsible for paying for all work done on a project, even if the general contractor has not paid his or her subcontractors.
2.
The Appeals Court unanimously found in favor of the Appellants in this case.
3.
The Opinion notes in the Discussion section that, under Missouri law,
A.
The statute is to be construed favorably to uphold the rights of laborers and material men.
B.
Section 429.010 provides that a mechanic’s lien may be placed upon the owner’s land for “any work or labor” completed upon such land by any person who contracts with the owner or his agent. The Appellants also successfully argued that Allen Edmonds was Plaza Frontenac’s agent.
C.
Most importantly, the contractors successfully argued that the trial court misapplied the law on the question of whether Crafton and Vogel’s improvements were substantial and permanent. The Appeals Court decision states that the trial court’s use of a mathematical equation comparing the relative size and value of the improvements to the overall size and value of the owner’s property was a misapplication of the law.
This portion of the decision has very important ramifications for all contractors who are involved in tenant finish work on any number of projects.
We congratulate Crafton and Vogel, and their attorneys, on their hard-won victory. AGC of Missouri was glad to help with legal support in this case. We all will benefit from their perseverance on this important legal matter.
Len
#AGCMO