Arias v. Brookstone LP

Texas Property Code �53.055 does not require that a mechanic's, contractor's or materialman's lien affidavit be filed with the county clerk before the required notice is given.

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Click here for the full text of this decision FACTS:Brookstone LP was the general contractor on a construction project. Brookstone posted a payment bond in favor of Unity, which was issued by Liberty Mutual Insurance Co. Brookstone subcontracted the site preparation to Site Work Group Inc (SWG). SWG, in turn, subcontracted with Gustavo Arias, doing business as Gus Trucking Service (Arias), to haul off the excavated material and to supply new fill for the foundation. Problems arose between these parties and also with others not involved in this appeal. Primarily, Brookstone was dissatisfied with SWG’s work, and SWG was dissatisfied with Arias’ work. When SWG did not pay Arias, he filed lien affidavits against the property, which affected Brookstone and its payment bond issued by Liberty Mutual. Brookstone filed suit seeking a declaratory judgment that Arias had no right to assert liens against the property. Brookstone later added SWG as a defendant, suing for breach of contract. Arias counterclaimed against Brookstone and Liberty Mutual as third-party defendants and cross-claimed against SWG. SWG counterclaimed against both Brookstone and Arias. After the trial court rendered partial summary judgment on some of the issues in dispute and others were nonsuited, the case was tried to a jury. The trial court rendered judgment that: 1. Brookstone take nothing from SWG; 2. SWG recover $15,000 from Brookstone along with attorneys’ fees for its quantum meruit claims; 3. SWG take nothing from Brookstone on its breach-of-contract and other claims; 4. Arias recover $42,000 from SWG along with attorneys’ fees for his breach-of-contract claim; 5. Arias take nothing from SWG on his fraud claims; and 6. SWG take nothing from Arias on its breach-of-contract claim. The trial court also rendered judgment based on its Feb. 14, 2005, summary-judgment order that: 1. Arias take nothing from Liberty Mutual on his claim on a payment bond; 2. the lien affidavits filed by Arias against Unity were invalid; and 3. Arias pay Brookstone and Liberty Mutual $15,000 in attorneys’ fees. HOLDING:Affirmed in part, reversed and remanded in part. In his first issue, Arias contended that the trial court erred in its Feb. 14, 2005, summary-judgment order by dismissing Arias’ claim for payment on the payment bond and invalidating his filed lien affidavits. On March 14, 2003, Arias executed lien affidavits and mailed copies to Unity, the property owner, and contractors Brookstone and SWG. On April 4, 2003, Arias filed the affidavits with the county clerk. Brookstone’s and Liberty Mutual’s motion for summary judgment against Arias argued that: 1. Arias failed to comply with the notice provisions of Texas Property Code �53.055(a), because he sent copies of the affidavits before he filed them with the county clerk; and Arias’ May 29, 2003, lien affidavits, filed with the county clerk on May 30, 2003, were not supported by any valid debt. Section 53.055(a) states that “[a] person who files an affidavit must send a copy of the affidavit by registered or certified mail to the owner or reputed owner at the owner’s last known business or residence address not later than the fifth day after the date the affidavit is filed with the county clerk.” Applying the rules of statutory interpretation to �53.055, the court concluded that the purpose of the statute is to ensure that the owner receives actual notice that a lien affidavit has been executed with the intent to file the affidavit and create a lien against the owner’s property, thus allowing the owner or original contractor to take appropriate action. Nothing in the statute, the court stated, requires that the property owner or original contractor be notified that the affidavit was actually filed. Because the person executing the lien affidavit must file the affidavit by the relatively short deadlines stated in ��53.052 and 53.056 (generally within two to four months from the date the indebtedness accrues), the court stated that the owner and original contractor can hardly claim to be hurt when they are notified in advance of the actual filing of the lien affidavit. In fact, the property owner or original contractor may be able to resolve the dispute before the lien affidavit is filed, preventing a cloud on title to the property. It is in no way absurd, the court stated, for the legislature to allow a property owner or original contractor to receive notice before an affidavit is actually filed, as opposed to five days after the filing occurs. The court declined to rewrite �53.055 to require that notice can be given only after the lien affidavit is filed. Because the court held that the March 14, 2003, affidavits were not invalid due to lack of notice, the court did not reach Brookstone’s and Liberty Mutual’s second ground for summary judgment. In issue two, Arias challenged the trial court’s award of attorneys’ fees under �53.156. Because the court concluded that the trial court erred in granting Brookstone’s and Liberty Mutual’s motion for summary judgment, the court agreed that the trial court’s award of attorneys’ fees was error. In two issues, SWG challenged the portion of the final judgment which awarded $42,000 to Arias. SWG first argued that Arias’ attorney committed incurable jury argument by “going outside the record to allege criminal conduct, fraud, and a conspiracy between SWG and Brookstone.” The trial court instructed the jury to base the verdict on the evidence and to not let bias, prejudice or sympathy affect its deliberations. SWG failed to obtain a contemporaneous adverse ruling on its objections, as is normally required to preserve an error for appeal. SWG acknowledged its lack of preservation at closing argument but relied on case law that relieves a party from contemporaneously preserving error concerning an improper jury argument if the argument is incurable. The court held that in light of the entire case, SWG failed to meet its burden to demonstrate an incurable jury argument. Brookstone further challenged the portion of the final judgment which awarded $70,000 to SWG from Brookstone for attorneys’ fees, plus additional attorneys’ fees on appeal and court costs. Brookstone asked the court to reverse those awards, because SWG did not prevail on its quantum meruit claim and was not a successful party to the suit. The court agreed and reversed the awards. Thus, the court reversed the portions of the judgment that: dismissed Arias’ claim for payment on the payment bond and invalidated his filed lien affidavits; awarded attorneys’ fees from Arias to Brookstone and Liberty Mutual; and awarded $15,000 from Brookstone to SWG, as well as attorneys’ fees and court costs. The court, however, affirmed the remainder of the judgment and remanded the case to the trial court for the limited purposes of considering Arias’ claim on the payment bond and and any motion to sever. OPINION:Nuchia, J.; Nuchia, Keyes and Higley, JJ.

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