Appellant, Shady Tree Farms, LLC (Shady Tree), delivered mature trees for the landscaping of a development known as Granite Park. When Shady Tree did not receive payment, Shady Tree recorded a materialman's lien.
In this appeal, Shady Tree challenges the judgment on the pleadings entered in favor of respondent, Omni Financial, LLC (Omni), on Shady
The trial court correctly granted Omni's motion for judgment on the pleadings. Accordingly, the judgment will be affirmed.
The Granite Park development covered several acres of property and was to be filled with a sports complex, restaurants and entertainment for all ages. The entities developing Granite Park were the Zone Sports Center, LLC (Zone), Granite Park Kids' Foundation (Foundation), JEG Ventures, LLC (JEG), and High Speed Development, LLC.
Omni provided an $18 million construction loan to the Zone that was secured by a deed of trust on the properties owned by the Zone. Omni recorded the deed of trust in January 2006. Omni recorded a modification to this deed of trust in March 2007.
Shady Tree is in the business of growing and selling mature trees for landscaping. On August 11, 2008, Shady Tree entered into a contract with JEG to sell trees to the owners of Granite Park. Shady Tree agreed to deliver 1,879 trees for a price of approximately $3.2 million.
Between August 12, 2008, and November 10, 2008, Shady Tree delivered 959 trees to the Granite Park development. A landscaping company immediately planted 47 of these trees and the remaining trees were placed around the development for planting at a later date. The Granite Park entities assumed ownership and responsibility for the trees but failed to care for them. Eventually, all of the trees died.
Except for a $25,000 deposit, Shady Tree was not paid for the trees. On February 3, 2009, Shady Tree recorded a materialman's lien against JEG, the Zone and the Foundation seeking to recover the balance due of $1,959,244.50 plus interest from September 1, 2008.
On April 2, 2009, Shady Tree filed the underlying action to enforce its materialman's lien. Shady Tree further requested a declaration that its materialman's lien had priority over Omni's deed of trust. Shady Tree also sought to enjoin Omni from foreclosing on its deed of trust pending resolution of the priority issue.
Omni, along with defendant City of Fresno, filed a motion to remove Shady Tree's materialman's lien and expunge the lis pendens. Omni asserted that Shady Tree could not demonstrate the probable validity of its lien because Shady Tree was required to, and did not, serve a preliminary 20-day notice. The trial court agreed and granted the motion.
Thereafter, Omni moved for judgment on the pleadings. Omni argued that Shady Tree could not prevail on its cause of action for declaratory relief with regard to the priority of its lien because the lien had been removed. Omni further asserted that Shady Tree could not prevail on its cause of action to enjoin the foreclosure because Omni had already foreclosed. Shady Tree did not oppose the motion and judgment was entered in Omni's favor.
Shady Tree argues that it was not required to give a preliminary 20-day notice to Omni before filing its materialman's lien and therefore the trial court erred in removing its lien and granting judgment on the pleadings based on Shady Tree's failure to serve such notice.
It is undisputed that Shady Tree did not serve a preliminary 20-day notice on Omni. Shady Tree argues that it was not required to do so under section 3097 because it was under direct contract with the owner.
Section 3097 provides, in relevant part:
"`Preliminary 20-day notice (private work)' means a written notice from a claimant that is given prior to the recording of a mechanic's lien . . . and is required to be given under the following circumstances:
"(a) Except one under direct contract with the owner . . . , every person who furnishes labor, service, equipment, or material for which a lien . . . otherwise can be claimed under this title . . . , shall, as a necessary prerequisite to the validity of any claim of lien, ... cause to be given to the owner or reputed owner, to the original contractor, or reputed contractor, and to the construction lender, if any, or to the reputed construction lender, if any, a written preliminary notice as prescribed by this section.
"(b) Except the contractor, . . . all persons who have a direct contract with the owner and who furnish labor, service, equipment, or material for which a lien . . . otherwise can be claimed under this title, . . . shall, as a necessary prerequisite to the validity of any claim of lien, . . . cause to be given to the construction lender, if any, or to the reputed construction lender, if any, a written preliminary notice as prescribed by this section."
Shady Tree disagrees with this interpretation of section 3097, subdivision (b). Rather, Shady Tree posits that section 3097, subdivision (b) should
In construing section 3097, we begin with its plain language, affording the words their ordinary and usual meaning. (Vasquez v. State of California (2008) 45 Cal.4th 243, 251 [85 Cal.Rptr.3d 466, 195 P.3d 1049].) At the same time, we must give meaning to every word of the statute, if possible, and avoid a construction that makes any word surplusage. (Briggs v. Eden Council for Hope & Opportunity (1999) 19 Cal.4th 1106, 1118 [81 Cal.Rptr.2d 471, 969 P.2d 564].) Although, as remedial legislation, mechanic's lien laws are to be liberally construed for the protection of laborers and materialmen, we nevertheless must apply common sense to the language at issue and interpret the statute to make it workable and reasonable. (Wasatch Property Management v. Degrate (2005) 35 Cal.4th 1111, 1122 [29 Cal.Rptr.3d 262, 112 P.3d 647].)
"As has been noted, `[t]he Mechanic's Lien Law often is inartfully drawn and leaves much room for doubt . . . .'" (Kodiak Industries, Inc. v. Ellis (1986) 185 Cal.App.3d 75, 82, fn. 3 [229 Cal.Rptr. 418] (Kodiak Industries).) Subdivisions (a) and (b) of section 3097 fall into this "inartfully drawn" category. Nevertheless, we must interpret section 3097 in such a way as to avoid making either subdivision "surplusage."
If we were to adopt Shady Tree's position and find that if a materialman is excepted under either subdivision (a) or (b) of section 3097, that materialman is not required to give a preliminary 20-day notice as a prerequisite to foreclosing on its lien, all of section 3097, subdivision (b), would be surplusage. The persons who have a direct contract with the owner and who furnish labor, service, equipment, or material would never be required to give a preliminary 20-day notice to the construction lender or reputed construction lender as is required under section 3097, subdivision (b), because they would always be exempt under section 3097, subdivision (a).
Further, section 3097, subdivision (b), refers to the contractor rather than a contractor. The use of "the" indicates a single person, i.e., the prime or general contractor for the project, not multiple contractors, i.e., the subcontractors or others with direct contracts with the owner.
Other courts that have had occasion to analyze the term "contractor" as used in section 3097, subdivision (b), have concluded that "the contractor" refers to the general or prime contractor. In Kodiak Industries, the court noted that the exception of "the contractor" in section 3097, subdivision (b), was "puzzling" but that it presumably referred to someone other than "`all persons who have a direct contract with the owner.'" (Kodiak Industries, supra, 185 Cal.App.3d at p. 82, fn. 3.) Although undefined, contractor in this context "has sensibly been construed to mean the general or prime contractor for the entire project." (Ibid.) Similarly, the court in Westfour Corp. v. California First Bank (1992) 3 Cal.App.4th 1554, 1561 [5 Cal.Rptr.2d 394], adopted this construction of "the contractor" in section 3097, subdivision (b). The court summarized section 3097 as requiring "all persons other than a person who is both `under direct contract with the owner' and `the contractor' to give preliminary notice to a construction lender within 20 days after commencing work on a project. The term `the contractor' in section 3097 has been interpreted to mean `the general or prime contractor for the entire project.'" (Westfour Corp., supra, at p. 1561.)
Shady Tree did not give Omni the preliminary 20-day notice as it was required to do under section 3097. Thus, Shady Tree cannot enforce its lien against Omni. Accordingly, the trial court correctly granted Omni judgment on the pleadings. Omni was entitled to judgment as a matter of law.
The judgment is affirmed. Costs on appeal are awarded to respondent.
Gomes, J., and Detjen, J., concurred.