No. 13326
I N T E SUPREME C U T O THE STATE O MONTANA
H OR F F
1976
FRED OLSON,
P l a i n t i f f and A p p e l l a n t ,
WESTFORK PROPERTIES, I N C . ,
a Montana Corporation,
Defendant and Respondent.
Appeal from: D i s t r i c t Court of t h e Eighteenth J u d i c i a l D i s t r i c t ,
Hon. W. W. Lessley, Judge p r e s i d i n g .
Counsel of Record:
For Appellant:
Landoe, Gary and Planalp, Bozeman, Montana
Robert P l a n a l p argued, Bozeman, Montana
For Respondent:
Berg, Angel, Andriolo and Morgan, Bozeman, Montana
Charles Angel argued, Bozeman, Montana
Submitted: October 14, 1976
Decided : NOV 3 0 1976
Filed :
3 0 1976
M r . J u s t i c e John Conway Harrison d e l i v e r e d t h e Opinion of
t h e Court.
This a c t i o n involves an attempted f o r e c l o s u r e of a
mechanic's l i e n again property of a corporation by a c o n t r a c t o r .
The d i s t r i c t c o u r t , G a l l a t i n County, e n t e r e d f i n d i n g s of f a c t ,
conclusions of law and judgment f o r defendant c o r p o r a t i o n ,
On October 6 , 1973 p l a i n t i f f Fred Olson and defendant
Westfork P r o p e r t i e s , I n c . , entered i n t o a c o n t r a c t t o i n s t a l l
sewer and water l i n e s on Westfork's property, a subdivision
n e a r t h e Big Sky r e c r e a t i o n a r e a , P l a i n t i f f Olson was t o supply
men and equipment while Westfork supplied a l l required m a t e r i a l s
and some equipment including a t r a c t o r , lowboy t r a i l e r and a
backhoe operated by a Westfork employee, f o r t h e p r o j e c t .
Plans and s p e c i f i c a t i o n s were drawn f o r t h e p r o j e c t by
t h e f i r m of Thomas, Dean & Hoskins, p r o f e s s i o n a l engineers. An
employee of t h e firm, James A. Cummings, a r e g i s t e r e d p r o f e s s i o n a l
engineer, was assigned t o supervise t h e p r o j e c t and i n s u r e
s p e c i f i c a t i o n s were met.
P l a i n t i f f was t o r e c e i v e $ 3 f o r each i n s t a l l e d and approved
l i n e a l f o o t of l i n e , with payments t o be made on t h e 1 0 t h of
each month following submission of a statement on t h e l a s t day of
t h e month preceding. Ten percent of each payment was r e t a i n e d
by defendant corporation a s a l'holdbackl', t o be paid t o p l a i n t i f f
no l a t e r than 30 days a f t e r s a t i s f a c t o r y completion of t h e e n t i r e
project.
The c o n t r a c t required a l l work be done according t o
s p e c i f i c a t i o n s which required (1) b a c k f i l l of subgrade leaving
no rocks o r stones w i t h i n 6 inches of t h e f i n i s h e d subgrade
e l e v a t i o n s t o i n t e r f e r with l a t e r road c o n s t r u c t i o n ; (2) t h e
c o n t r a c t o r was t o c l e a n up t h e a r e a and leave i t e s s e n t i a l l y
i n t h e same condition a s when t h e p r o j e c t began, which included
an o b l i g a t i o n t o remove a l l rocks brought t o t h e s u r f a c e i n t h e
course of h i s excavation; ( 3 ) a l l b a c k f i l l was t o be compacted t o
c o n t r a c t s p e c i f i c a t i o n s ; and (4) a l l l i n e s were t o be subjected
t o a h y d r o s t a t i c pressure t e s t a f t e r b a c k f i l l i n g was completed.
Olson was o b l i g a t e d t o r e p a i r any l i n e s t h a t f a i l e d t h e s e tests.
Olson began work on t h e p r o j e c t about 10 days a f t e r t h e
agreement was executed. Monthly b i l l i n g s were submitted and a s
of August 4 , 1974, t h e t o t a l b i l l i n g s amounted t o $92,786.66,
of which Olson had been paid $81,860.99, with Westfork holding
back $10,925.67 pending s a t i s f a c t o r y completion of t h e p r o j e c t .
The statement submitted by Olson on August 4 , 1974, i n d i c a t e d
he considered t h e p r o j e c t t o be completed. Testimony a t t h e
d i s t r i c t c o u r t t r i a l indicatEs t h e c o n t r a c t had n o t been completed
t o t h e s a t i s f a c t i o n of Westfork o r ehgineer Cummings, because
t h e r e was a 616 f o o t s e c t i o n of water l i n e i n t h e p r o j e c t which
had f a i l e d t h e h y d r o s t a t i c t e s t s and a l s o because t h e cleanup
work required by t h e c o n t r a c t was n o t s a t i s f a c t o r y .
N f u r t h e r i n s t a l l a t i o n o r cleanup work was done on
o
Westfork's property a f t e r August 4 , 1974. Olson d i d r e t u r n t o
t h e property t o complete t e s t i n g of t h e l i n e s and t o attempt
l o c a t i o n and r e p a i r of t h e l e a k i n t h e s e c t i o n which f a i l e d h y d r o s t a t i c
tests. Three days were spent i n an unsuccessful search f o r t h e
l e a k , u n t i l November 27, 1974, when Olson and h i s crew were l a s t
on t h i s p r o j e c t .
Olson f i l e d a mechanic's l i e n on February 25, 1975 on t h e
property owned by Westfork and subsequently f i l e d an a c t i o n t o
foreclose his lien, claiming $11,096.66 plus interest and
reasonable attorney fees. Westfork's answer asserted the lien
was null and void and contained a counterclaim seeking damages
of $18,733.85 sustained in correction of alleged deficiencies
in work performed. The district court issued findings of fact
and conclusions of law awarding $9,812 to Westfork, to be withheld
from the $10,925.67 "holdback". In addition, the court concluded
Olson was not entitled to a valid lien because the project was
not completed to the satisfaction of Westfork and in compldance
with the plans and specifications. The district court also
concluded the lien had not been filed within 90 days after the
last labor and machinery was furnished by plaintiff in installation
of the water and sewer lines.
This Court's function in reviewing findings of fact in
a civil action tried by the district court without a jury is
not to substitute its judgment in place of the trier of facts
but rather it is "confined to determining whether there is
substantial credible evidence to support" the findings of fact
and conclusions of law. Hornung v. Estate of Lagerquist, 155
Mont. 412, 420, 473 P.2d 541. See also: Transamerica Ins. Co.
v. Glacier Gen. Assurance Co., 163 Mont. 454, 461, 517 P.2d 888.
Although conflicts may exist in the evidence presented, it is
the duty and function of the trial judge to resolve such conflicts.
His findings will not be distmpbed on appeal where they are based
on substantial though conflicting evidence. Fausett v. Blanchard,
154 Mont. 301, 463 P.2d 319; Clough v. Jackson, 156 Mont. 272,
479 P.2d 266; Intermountain Electric, Inc. v. Berndt, 164 Mont.
67, 518 P.2d 1168; City of Missoula v. Rose, 164 Mont. 90, 519
P.2d 146.
-4-
In determining whether the trial court's findings are
supported by substantial evidence, this Court must view the
evidence in the light most favorable to the prevailing party.
Hellickson v. Barrett Mobile Home Transport, Inc., 161 Mont. 455,
507 P.2d 523; McEwen v. Big Sky of Montana, Inc., - .
Mont ,
545 P.2d 665, 33 St.Rep. 79. Substantial evidence has been
defined by this Court as such as will convince reasonable men
and on which such men may not reasonably differ as to whether
it establishes the plaintiff's case, and, if all reasonable
men must conclude that the evidence does not establish such
case, then it i$ not substantial evidence. The evidence may
be inherently weak and still be deemed "substantial", and
one witness may be sufficient to establish the preponderance
of a case. See: Staggers v. U.S.F. & G. Co., 159 Mont. 254,
496 P.2d 1161; Greene v. Knapp's Service, 161 Mont. 438, 440,
506 P.2d 1381.
The district court after hearing testimony granted
defendant's counterclaims in the amount of $9,812.. Damages
awarded consisted of: (1) $4,312 for repair of the leaking section
of water line; (2) $2,000 for cleanup of the area; (3) $3,000 for
rental value of the tractor, lowboy, and backhoe furnished by
Westfork; and (4) $500 for the cost of replacement of a number
of survey markers buried or knocked down by Olson in the course
of construction operations.
No evidence was offered by either party as to the cost
of cleanup, also defendant conaeded the evidence most favorable
to it in regard to rental of the Westfork equipment will only
support an award of $1,600, therefore the judgment must be
reduced by $3,400. Ample evidence and testimony was offered to
support t h e balance of t h e judgment and t h e d i s t r i c t c o u r t t s
award must s t a n d , reduced only by t h e amount f o r which t h e r e
was no evidence offkred by e i t h e r party.
The d i s t r i c t c o u r t ' s determination regarding t h e i n v a l i d i t y
of t h e l i e n f i l e d by Olson i s supported by t h e evidence o f f e r e d
a t trial. . A c o n t r a c t o r cannot s u c c e s s f u l l y a s s e r t a mechanic's
l i e n upon t h e property where t h e r e has been only p a r t performance
o r a l a c k of s u b s t a n t i a l performance of t h e work f o r which t h e
p a r t y claims t h e l i e n . 53 Am J u r 2d, Mechanics' Liens, 3 51;
F i d e l i t y Sav. & Loan Ass'n v. Baldwin, (Tex.Civ.App. 1967),
416 S.W.2d 482; Intermountain E l e c t r i c , I n c . v. Berndt, 164 Mont.
67, 518 P.2d 1168.
Testimony o f f e r e d supports t h e de terminat i o n t h a t p l a i n t i f f
f a i l e d t o complete t h e work contracted t o be done. Several
hundred f e e t of water l i n e leaked, much of t h e rock brought t o
t h e s u r f a c e during excavation was windrowed r a t h e r than removed,
and compaction of b a c k f i l l was n o t done according t o c o n t r a c t -
s p e c i f i c a t i o n s and procedures. . This Court i n Western Plumbing
of Bozeman v. Garrison, -Mont. , , P.2d , 33 S t .
Rep. 868, 870, held:
"* * * we f i n d t h e l i e n s were f i l e d prematurely and a r e
t h e r e f o r e i n v a l i d . I n Montana t h e g e n e r a l r u l e i s t h a t
t h e l i e n a r i s e s only upon completion of t h e contracted
work. *** Although s u b s t a n t i a l performance of t h e
contracted work meets t h i s requirement, such s u b s t a n t i a l
performance i s a condition precedent t o l i a b i l i t y of
t h e homeowners."
The l i e n i s i n v a l i d and unenforceable f o r f a i l u r e of t h e
c o n t r a c t o r t o s u b s t a n t i a l l y complete performance, t h e r e f o r e
i t i s unnecessary t o determine whether t e s t i n g and r e p a i r work
extend t h e time period w i t h i n which t h e l i e n could have been
f i l e d under s e c t i o n 45-502, R.C.M. 1947.
The judgment of t h e d i s t r i c t c o u r t i s affirmed a s
modified h e r e i n .
Justices /
I
Hon. Robert C. ,S*es, District
Judge, sitting,::,£ o r J u s t i c e Wesley
Castles.