Opinion
D039557.
11-20-2003
LABIRINTO SRL, Plaintiff and Appellant, v. LJFRP, LLC, Defendant and Respondent.
Plaintiff Labirinto SRL appeals a summary judgment in favor of defendant LJFRP, LLC. Labirinto contends the trial court erred by determining that (1) Labirintos failure to serve LJFRP with a preliminary 20-day notice precludes its cause of action for foreclosure on its mechanics lien; and (2) LJFRP, which had no contract with Labirinto, is not liable for unjust enrichment, quantum meruit and related counts. We affirm the judgment.
BACKGROUND
In 1999 LJFRP entered into a contract with Sharratt Construction (Sharratt) for Sharrats construction of a home for LJFRPs owner in La Jolla, California. Sharratt entered into a subcontract with Unique Stone Imports, Inc. (Unique Stone) for custom-made marble and mosaic products for the project. In turn, Unique Stone subcontracted with Italian Renaissance Collection (Italian Renaissance) for the products, and Italian Renaissance subcontracted with Labirinto, an Italian company, for the products. LJFRP, Sharratt and Unique Stone paid in full their respective charges for the products. However, Italian Renaissance did not fully pay Labirinto.
Labirinto filed a mechanics lien against LJFRPs property, seeking payment of its $180,000 outstanding balance. Labirinto then sued LJFRP for foreclosure on the mechanics lien, unjust enrichment, goods sold and delivered, money due and owing, and quantum meruit.
Labirinto also sued Italian Renaissance and other parties who are not involved in this appeal.
LJFRP moved for summary judgment, arguing among other things that Labirintos claims were precluded by its failure to serve LJFRP with a 20-day preliminary notice under Civil Code section 3097. The court granted the motion. Labirinto unsuccessfully moved for reconsideration, and judgment was entered for LJFRP on January 31, 2002.
Statutory references are to the Civil Code except when otherwise specified.
DISCUSSION
I
Standard of Review
"Any party may move for summary judgment in an action if it is contended that the action has no merit. [Citation.] A defendant seeking summary judgment bears the initial burden of proving the cause of action has no merit by showing that one or more of its elements cannot be established or there is a complete defense to it, such as the statute of limitations." (Cucuzza v. City of Santa Clara (2002) 104 Cal.App.4th 1031, 1037-1038.) If the defendant meets his or her initial burden, "the opposing party is then subjected to a burden of production of his [or her] own to make a prima facie showing of the existence of a triable issue of material fact." (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) We review the ruling on a summary judgment motion independently. (Rubenstein v. Rubenstein (2000) 81 Cal.App.4th 1131, 1143.)
II
Preliminary 20-day Notice
A
Contractors, subcontractors, materialmen and other specified persons performing labor on or furnishing materials to a private work of improvement are entitled to a lien on the improved property for the value of the labor or materials. (§ 3110.) As a prerequisite to the enforcement of a mechanics lien, a subcontractor or materialman without a direct contract with the property owner must have served the owner with a notice of lien rights within 20 days of first providing services or materials to the project. (§ 3097, subds. (a) & (b).) The notice must contain a general description of the labor or materials furnished, an estimate of the total price, and the names and addresses of the claimant and the party with whom he or she contracted. (Id., subd. (c).) Additionally, the notice must caution the owner that his or her property is subject to a mechanics lien if the claimants bills for labor or materials are not paid in full. (Ibid.)
"The purpose of the statutory notice requirement is to give the owner advance information of the identities of any unpaid claimants who may perfect liens against his property if their debts remain unsatisfied." (Truestone, Inc. v. Simi West Industrial Park II (1984) 163 Cal.App.3d 715, 722 (Truestone); Romak Iron Works v. Prudential Ins. Co. (1980) 104 Cal.App.3d 767, 778.) The Legislature intended "`to give increased financial security to the building industry by providing early notice to the owner, lender, and general contractor of the presence on the job of persons . . . entitled to file a mechanics lien and the amount of their potential liens. On a typical construction job, it is not unusual for the property owner and lending institution not to know the identity of persons furnishing labor and supplies to the job, other than the general contractor with whom they have dealt directly. [The notice requirement] was intended as a means of identifying these unknown persons, who are potential lien claimants, so that meaningful communication could be had among the property owner, lending institution and general contractor to insure timely payment of these persons claims and avoidance of costly work stoppages, mechanics liens foreclosure sales, and double payments by the owner." (Schrader Iron Works, Inc. v. Lee (1972) 26 Cal.App.3d 621, 630, discussing former Code of Civ. Proc., § 1193 [now Civ. Code, § 3097].)
A property owner served with a preliminary 20-day notice may take measures to protect his or her property from the recordation of a mechanics lien. For instance, an owner may issue joint checks to the prime contractor and claimant and make progress payments to the prime contractor contingent on obtaining the claimants written waiver and release of lien rights. (Civ. Code, § 3262; Cal. Mechanics Liens (Cont.Ed.Bar 3d ed. 1998) § 3.12, p. 112.)
Labirinto concedes it did not serve a preliminary 20-day notice, but contends it was not subject to the requirement because LJFRP had actual knowledge it was supplying custom-made materials to the project. Labirinto relies on section 3129, which provides: "Every work of improvement constructed upon any land and all work or labor performed or materials furnished in connection therewith with the knowledge of the owner . . . shall be held to have been constructed, performed, or furnished at the instance of such owner . . . and such interest shall be subject to any lien recorded under this chapter unless such owner . . . shall give a notice of nonresponsibility pursuant to Section 3094."
We are unpersuaded by Labirintos position. Section 3129 must be considered in conjunction with section 3094, which defines "notice of nonresponsibility" as "a written notice, signed and verified by a person owning . . . the site who has not caused the work of improvement to be performed . . . ." (Italics added.) Section 3129 "provides a mode by which the owner may exempt his interest from liability for any alterations made by his lessee or any other person without his consent." (Halspar, Inc. v. La Barthe (1965) 238 Cal.App.2d 897 [discussing Civ. Code, § 3129s predecessor, Code of Civ. Proc., § 1183.1].) Under estoppel principles, a subcontractor or materialman may enforce a mechanics lien, notwithstanding the lack of a preliminary 20-day notice, when a noncontracting owner has actual knowledge of the construction and does not post and record a notice of nonresponsibility. (Cal. Mechanics Liens, supra, § 3.20, p. 117; Kim v. JF Enterprises (1996) 42 Cal.App.4th 849, 856.) In that circumstance the claimant, who may not be aware of the owners identity, is deemed to have a direct contract with the owner for purposes of section 3097, subdivision (b). (Kim v. JF Enterprises, supra, at p. 856.)
Contrary to Labirintos suggestion, LJFRP is not a "noncontracting owner" simply because it had no contract with Labirinto. Rather, a "noncontracting owner is one who has not entered into a contract for the work of improvement, e.g., an owner of a fee interest whose lessee has contracted for the work." (Cal. Mechanics Liens, supra, § 8.2, p. 494, italics added; see also id., § 2:57, pp. 66-67.) A contracting owner, on the other hand, is any owner who "enters into a contract for a work of improvement." (Id ., § 8.2, p. 493.) "`[W]ork of improvement means the entire structure or scheme of improvement as a whole." (Civ. Code, § 3106.) A noncontracting owner may file a notice of nonresponsibility "`to bring home to those who are expending labor or materials upon a building, the fact that the owner of the land will not be responsible for such labor or materials." (Hayward Lbr. & Inv. Co. v. Ford (1944) 64 Cal.App.2d 346, 352.) A notice of nonresponsibility, of course, "does not protect the land or the building against lien claimants if the owner caused the work of improvement to be performed." (Cal. Mechanics Liens, supra, § 2.58, p. 67.)
Labirinto relies on the courts statement in Truestone, supra, 163 Cal.App.3d at page 722, that "[i]n some cases, even where there is no contractual relationship between the parties, actual knowledge may estop the property owner from asserting the notice requirements of section 3097." However, the Truestone court went on to explain that "where a work of improvement is completed on leased land under contract with a lessee of the property, a statutory exception to the notice requirement of section 3097 applies." (Id. at p. 722.) Here, LJFRP was a contracting owner.
Further, in Truestone the issue was whether a claimant had a direct contractual relationship with the property owner, based on the owners promise to pay. The court concluded: "[A]n exception to the statutory notice requirement precludes the defeat of the lien on meaningless technicalities where a materialman is known to the property owner and makes deliveries in reliance on his promise to pay. The contractor . . . then stands in a position similar to that of a lessee who contracts for improvements." (Truestone, supra, 163 Cal.App.3d at p. 723, italics added.) The court held evidence of the owners promise to pay was admissible to show the existence of an express contract. (Ibid.) Here, there is no allegation that LJFRP promised to pay Labirinto directly.
Section 3129 does not relieve subcontractors or materialmen from the preliminary 20-day notice requirement when, as here, the property owner contracted for the work of improvement. Indeed, it is established that an oral pre-lien notice — which would give an owner actual notice of the claimants identity — is insufficient to comply with the notice requirement. (Windsor Mills v. Richard B. Smith, Inc. (1969) 272 Cal.App.2d 336, 341.) As a matter of law, Labirintos failure to serve LJFRP with a preliminary 20-day notice precludes its foreclosure cause of action.
Given our holding, we are not required to consider LJFRPs contentions we should dismiss LJFRPs appeal as moot because a final judgment in favor of defendant Unique Stone extinguished Labirintos mechanics lien, and thus no foreclosure relief is available, or alternatively, we should affirm the judgment because LJFRP had no actual knowledge of Labirintos involvement in the project and Labirinto is not a materialman within the meaning of section 3110.
Further, the court did not err by denying Labirintos request to continue the summary judgment motion pending further discovery. Code of Civil Procedure section 437c, subdivision (h) requires the court to grant an application for a continuance for additional discovery when it appears from affidavits "that facts essential to justify opposition may exist but cannot, for reasons stated, then be presented." In a declaration, Labirintos attorney stated additional discovery was required to show the nature and extent of LJFRPs "knowledge of the construction" and of Labirintos identity as a material supplier. However, since section 3129 is inapplicable, any actual knowledge of LJFRP is irrelevant.
B
Labirinto contends summary judgment was improper on its causes of action for unjust enrichment, quantum meruit, goods sold and delivered, and money due and owing. Labirinto, however, cites no authority on point and does not even discuss the elements of those claims. "Where a point is merely asserted by counsel without any argument of or authority for its proposition, it is deemed to be without foundation and requires no discussion." (People v. Ham (1970) 7 Cal.App.3d 768, 783, disapproved of on another ground in People v. Compton (1971) 6 Cal.3d 55, 60, fn. 3; People v. Sierra (1995) 37 Cal.App.4th 1690, 1693, fn. 2.)
Even without waiver, Labirintos contention lacks merit. "The theory of quasi-contractual recovery is that one party has accepted and retained a benefit with full appreciation of the facts, under circumstances making it inequitable for him to retain the benefit without payment of its reasonable value." (Truestone, supra, 163 Cal.App.3d at p. 724.) "A subcontractor, who has no direct contractual relationship with the property owner, may generally not recover on an unjust enrichment theory for benefits conferred on the property." (Ibid.) "The rule is long and well established that in the absence of contractual privity the right to enforce a mechanics lien against real property does not give rise to personal liability on the part of the owner." (Rogers v. Whitson (1964) 228 Cal.App.2d 662, 673.) LJFRP paid the prime contractor in full for Labirintos products, and was not unjustly enriched at Labirintos expense. (Id. at p. 676 [no unjust enrichment when owner has paid prime contractor].)
Labirinto cites Sunlight Elec. Supply Co. v. McKee (1964) 226 Cal.App.2d 47, 51 (Sunlight), for the proposition that LJFRP should have to pay twice for the materials Labirinto supplied. In Sunlight, the prime contractor on a public improvement filed a release of a stop-notice bond in which it and the surety promised that if the plaintiff, an unpaid material supplier to a subcontractor, prevailed on its claim under the stop-notice, they would pay the judgment and costs of suit. The sole issue on appeal was whether a statutory requirement that a notice of pendency be served on the owners of the property within five days of the commencement of the stop-notice proceeding was a jurisdictional prerequisite to suit. The court answered in the negative, noting the prime contractor suffered no prejudice. In response to the prime contractors argument it should not have to pay for the materials twice, the court stated: "Such misfortunes are always regrettable, of course, but if one of two innocent parties must suffer the party who was neglectful in protecting its own interests cannot demand legal protection against this suffering at the expense of the other who otherwise would be the sufferer." (Ibid.) The court noted the prime contractor paid the subcontractor without checking to see if it had paid for materials. (Ibid.)
In contrast, the instant case does not involve a surety bond and LJFRP was not remiss in protecting its interests. Rather, Labirinto failed to protect its interests because it did not serve LJFRP with a preliminary 20-day notice. (See Rogers v. Whitson, supra, 228 Cal.App.2d at p. 676.) Moreover, the notice requirement is intended to avoid double payments by the owner. (Schrader Iron Works, Inc. v. Lee, supra, 26 Cal.App.3d at p. 630.)
Labirintos reliance on Windsor Mills v. Richard B. Smith, Inc., supra, 272 Cal.App.2d 336, is also misplaced. There, the plaintiff, which supplied carpet to a subcontractor, sued the property owner for foreclosure on a mechanics lien. The trial court dismissed the action on the ground the plaintiff failed to comply with the preliminary notice statute. The appellate court rejected the plaintiffs argument the ruling unjustly enriched the defendant, explaining the security for the debt was eliminated but the "debt still remains." (Id. at p. 342.) There, however, the property owner conceded it "still owed [the subcontractor] $6,000 on work already done and that there was some $20,000 on other or more goods to be delivered." (Id. at p. 339.) Here, LJFRP fully paid the prime contractor for Labirintos products.
Further, there is no evidence of LJFRPs implied promise to pay Labirinto directly for the reasonable value of its materials. "The count on quantum meruit alleges the performance of services or work and labor for the defendant at the defendants request, and usually adds an allegation that defendant promised to pay the reasonable value." (4 Witkin, Cal. Procedure (4th ed. 1997) Pleading, § 527, p. 615.) "Quantum meruit recovery is . . . justified where services were performed by a party at the request of another under circumstances in which compensation for such services would be expected." (Spires v. American Bus Lines (1984) 158 Cal.App.3d 211, 216-217.) LJFRPs agreement was with the prime contractor, and Labirinto, the subcontractor of two other subcontractors, had no reason to expect payment from LJFRP.
For the same reasons, Labirinto cannot maintain claims against LJFRP for goods sold and delivered or money had and received. "A common count alleges in substance that the defendant became indebted to the plaintiff in a certain stated sum . . . ." (4 Witkin, Cal. Procedure, supra, Pleading, § 518, p. 608.)
DISPOSITION
The judgment is affirmed. LJFRP is awarded costs on appeal.
We concur: BENKE, J., OROURKE, J.