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Terra Technical Services, LLC v. River Station Land, L.P.

Superior Court of Pennsylvania

July 31, 2013

TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee TERRA TECHNICAL SERVICES, LLC Appellant
v.
RIVER STATION LAND, L.P. Appellee

NON-PRECEDENTIAL DECISION

Appeal from the Order Entered July 25, 2012 In the Court of Common Pleas of Chester County Civil Division at No(s): 10-02348, 10-02349, 10-02338, 10-02339, 10-02340, 10-02337, 10-02336, 10-02350, 10-02343, 10-02347, 10-02346, 10-02342, 10-02341, 10-02332, 10-02335.

BEFORE: GANTMAN, J., ALLEN, J., and OTT, J.

MEMORANDUM

OTT, J.

Terra Technical Services, LLC, ("Terra") appeals from seventeen identical orders entered on July 25, 2012, in the Court of Common Pleas of Chester County, sustaining River Station Land, L.P.'s ("River Station") preliminary objections and striking Terra's complaint in civil action to obtain judgment on mechanics' lien. On appeal, Terra complains the trial court erred in sustaining River Station's preliminary objections and striking its complaint filed under the same court term and number as the mechanics' lien claim, and for not granting Terra leave to file a complaint under a separate court term and number. Additionally, Terra argues the trial court does not have a local rule governing the filing of such complaints, and the local practice is to file the complaint under either the same court term and number as the mechanics' lien claim or to a separate court term and number. Based on the following, we affirm.

As the parties are well acquainted with the facts of this case, we briefly summarize the background underlying this matter: In 2007, Terra and River Station entered into a written contract whereby Terra was to perform certain demolition and debris removal on a 76-acre parcel of land owned by River Station for an agreed upon amount of $2, 497, 000.00. After completion of the work, Terra only received a portion of the payment for the work performed.

On March 3, 2010, Terra filed 17 identical mechanics' lien claims for designated parcels of property. Terra alleged it began the work on July 31, 2007 and completed the project on December 23, 2008, pursuant to the parties' agreement. Moreover, Terra claimed the character of the labor and material that it furnished for the property consisted of the demolition of structures and facilities, including the removal of material and debris. Terra stated the principal amount for each lien claimed was $53, 695.06.

On January 5, 2011, River Station filed preliminary objections to the claims pursuant to 49 P.S. § 1505.[1] Specifically, it argued Terra failed to file the claim within six months after completion of the work and therefore, the claim was time-barred under 49 P.S. § 1502(a)(1).[2] Moreover, River Station asserted that the parcels at issue did not meet the definition of "property" under 49 P.S. § 1201(2), [3] and therefore, the lien could not attach since the demolition and removal was not incidental to the erection, construction, or repair of a structure as set forth in 49 P.S. §§ 1201(12)[4] and 1301.[5]

On January 25, 2011, Terra filed an answer to River Station's preliminary objections to the claim. Neither party requested a ruling on these preliminary objections and did not take the action necessary to bring these preliminary objections before the trial court for a decision. Accordingly, no action was ever taken by the court with respect to these preliminary objections.

On March 2, 2012, Terra filed 17 identical complaints in civil action to obtain judgment on the mechanics' liens. Terra filed the complaints under the same corresponding docket numbers as the mechanics' liens. On March 29, 2012, River Station filed preliminary objections to the complaint, claiming that underlying mechanics' lien was defective and should be stricken based on the Pennsylvania Rules of Civil Procedure 1651(b), 1653, and 1656(2).[6] River Station also renewed its original preliminary objections. Terra responded on April 18, 2012.

On July 25, 2012, at Docket No. 10-02332, the trial court issued an order sustaining the preliminary objections and striking the complaints. In a footnote, the court explained its rationale:

The preliminary objections raise, inter alia, the issue of whether or not an action to obtain judgment upon a mechanics' lien claim can be maintained as part of the mechanics' lien claim itself. We hold that it cannot. The action must be commenced by filing a complaint or an agreement for an amicable action. Filing a complaint in an existing proceeding is not commencement of the action. The complaint must set forth "the court and number and the date of the filing of the claim and a copy thereof as an exhibit." Pa.R.C.P. No. 1656(2). These requirements make no sense if the complaint is filed in the same case as the lien claim itself. As stated in Tully Drilling Co., Inc. v. Shenkin, 409 Pa.Super. 333, 597 A.2d 1230 (Pa.Super. 1991), "Under existing law, the proceedings in mechanics' lien cases fall into two distinct, consecutive stages: (1) filing and perfecting the claim of a mechanics' lien; and (2) instituting and prosecuting an action sur claim of a mechanics' lien. The papers relating to each stage are entered in separate dockets, kept in separate files, and bear separate designations of court term and number." Id[.] at 337-338, 597 A.2d at 1232.

Order, 7/25/2012, at 1 n.1.[7]

On August 2, 2012, Terra filed a motion for reconsideration and for leave to file complaint nunc pro tunc. On August 21, 2012, Terra also filed this appeal.[8] By order dated August 23, 2012, the court denied Terra's motion for reconsideration and for leave to file complaint nunc pro tunc.

In Terra's first argument, it claims the court erred in sustaining River Station's preliminary objections and striking its complaint in civil action to obtain judgment on mechanics' lien claim based on Terra's failure to file the complaint under a separate court term and number from the mechanics' lien claim. Relying on Bricklayers of W. Pa. Combined Funds, Inc. v. Scott's Dev. Co., 41 A.3d 16 (Pa.Super. 2012) (en banc), appeal granted in part, 58 A.3d 748 (Pa. 2012), Terra states the Mechanics' Lien Law is no longer strictly construed and the court's reliance on Tully, supra, is erroneous because the Tully Court "based its decision on the strict and narrow construction of the Mechanics' Lien Law." Terra's Brief at 11. Terra contends a liberal construction of the law should be applied to the matter. In this regard, Terra asserts the Mechanics' Lien Law and the Rules of Civil Procedure do not entail the initiation of a new action under a separate term and number to enforce a lien claim but "simply require the filing of a complaint with the Prothonot[ar]y." Id. Lastly, Terra concludes that even if the claims were strictly construed, the trial court,

was nonetheless obligated to view the complaint to enforce the lien claims in light of the doctrine of substantial compliance. . . . As long as some notice of the lien and complaint is given to the owner, the doctrine of substantial compliance tempers any strict construction of the requirements of the Mechanics' Lien Law.

Id. at 12, citing Tesauro v. Baird, 335 A.2d 792 (Pa.Super. 1975).

We begin with our well-settled standard of review:

When reviewing the dismissal of a complaint based upon preliminary objections in the nature of a demurrer, we treat as true all well-pleaded material, factual averments and all inferences fairly deducible therefrom. Where the preliminary objections will result in the dismissal of the action, the objections may be sustained only in cases that are clear and free from doubt. To be clear and free from doubt that dismissal is appropriate, it must appear with certainty that the law would not permit recovery by the plaintiff upon the facts averred. Any doubt should be resolved by a refusal to sustain the objections. Moreover, we review the trial court's decision for an abuse of discretion or an error of law.
Ira G. Steffy & Son, Inc. v. Citizens Bank of Pennsylvania, 2010 PA.Super. 175, 7 A.3d 278, 282-283 (Pa.Super. 2010) (quoting Burgoyne v. Pinecrest Community Ass'n, 2007 PA.Super. 132, 924 A.2d 675, 679 (Pa.Super. 2007)). A demurrer should be sustained only when the complaint is clearly insufficient to establish the pleader's right to relief. Ellenbogen v. PNC Bank, 1999 PA.Super. 131, 731 A.2d 175, 181 (Pa.Super. 1999).

B.N. Excavating, Inc. v. PBC Hollow-A, L.P., __ A.3d __, __, 2013 PA.Super. 120, ¶¶ 7-8 (Pa.Super. 2013).

Here, the trial court rejected Terra's argument, as follows:
It would appear to be [Terra]'s position that the complaint to obtain judgment may be filed to the same term and number as the original claim and does not require the filing of a complaint as a new action. There is no support for [Terra]'s position.
. . . .
First, Pa.R.C.P. No. 1651 defines "claim" and "action." "'Claim' means a mechanics' lien claim which has been filed; 'action' means an action to obtain judgment upon a claim." Pa.R.C.P. No. 1651(a). Next, Pa.R.C.P. No. 1653 is entitled "Commencement of Action" and provides "An action shall be commenced by filing with the Prothonotary (a) a complaint, or (b) an agreement for an amicable action." (emphasis added). "Commence" means "to begin, start." The American Heritage Dictionary, 3rd edition (1994); Smolow v. Hafer, 867 A.2d 767, 772 (Pa. Cmwlth. 2005). Thus, it is the complaint or agreement for an amicable action that starts or begins the action. This language is inconsistent with the contention that the complaint is to be filed as part of the already existing claim. Filing the complaint as part of the claim proceeding would not be starting or beginning anything. The contents of the complaint are mandated by Pa.R.C.P. No. 1656 and must include "the court and number and the date of the filing of the claim and a copy thereof as an exhibit." Pa.R.C.P. No. 1656(2) (emphasis added). The former provisions led the leading commentator on the rules of civil procedure to the following "Observation: A complaint in an action upon a mechanics' lien must set forth the court, term, number, and the date of the filing of the claim underlying the action; this indicates that the filing number for such an action is intended to be a new one, different from the claim number." Goodrich-Amram, 2d, § 1653:1 at 511 (emphasis partly in original and partly added). In addition, the requirement that a copy of the claim must be an exhibit to the complaint would be unnecessary and illogical if the complaint were merely part of the same proceeding a[s] the claim itself.
[Terra] cites Bricklayers of Western Pennsylvania Combined Funds, Inc. v. Scott's Development Co., 41 A.3d 16 (Pa.Super. 2012) for the proposition that the current Mechanics' Lien Law is to be liberally construed and argues that the result in Tully Drilling Co., Inc, supra, was based upon a strict construction of the Mechanics' Lien Law. [Terra] nowhere explains how a liberal construction of the Mechanics' Lien Law or the Rules of Civil Procedure as opposed to a strict construction thereof would in any way alter the result in this case. In fact, it would not. Although the opinion in Tully does refer to strictly construing that law and the rules of procedure implementing that law, the language of the Rules of Civil Procedure is clear and the issue of "strict construction" versus "liberal construction" really does not come into play in this matter. The Mechanics' Lien Law states that "[t]he practice and procedure to obtain judgment upon a claim filed shall be governed by the Rules of Civil Procedure promulgated by the Supreme Court." Mechanics' Lien Law of 1963, § 701, 49 P.S. § 1701. Construed strictly or liberally, we find that the practice and procedure to obtain judgment upon a claim is governed by the Rules of Civil Procedure. For the reasons set forth above, the Rules of Civil Procedure compel the result which we reached. "Liberal construction" of rules or statutes does not mean altogether ignoring the language thereof as claimant appears to have done in this case in deciding to file the complaint to the term and number of the original claim.

Trial Court Opinion, 9/19/2012, at 3-5 (emphasis in original).

We agree with the trial court's well-reasoned analysis.
The right to a mechanic's lien is purely a creature of statute and it is only available if the conditions of the legislature are strictly followed. Where the words of the statute are clear, the courts should not be requested to go beyond the requirements of the act to determine who was or who was not dilatory and responsible for the delay. . . . The statute must be followed whether strict or liberal, harsh or equitable.

Brann & Stuart Co. v. Consolidated Sun Ray, Inc., 253 A.2d 105, 106 (Pa. 1969) (emphasis added).

Section 1701 of the Mechanics' Lien Law expressly provides that the "practice and procedure to obtain judgment upon a claim filed" are governed by the Pennsylvania Rules of Civil Procedure. 49 P.S. § 1701. The Rules of Civil Procedure state that an action upon a mechanics' lien shall be commenced by the filing of a complaint or an agreement for an amicable action. See Pa.R.C.P. 1653. An action does not commence by the filing of a mechanics' lien claim. Likewise, where one files a mechanics' lien claim and then files a complaint in the same proceeding, an action does not commence. See Pa.R.C.P. 1656(2). As such, Terra's argument that under a joint reading of Mechanics' Lien Law and the Rules of Civil Procedure, the statute and the rules do not require the initiation of a new action under a separate term and number to enforce a lien claim is erroneous and misguided.

Moreover, Terra's filing of the 17 identical mechanics' liens on March 3, 2010 did not constitute "commencement" of this action against River Station. Further, Terra's subsequent filing of 17 identical complaints in civil action to obtain judgment on the mechanics' liens on March 2, 2012, under the same filing numbers as the mechanics' liens, also did not "commence" the action. Accordingly, Terra did not comply with the procedural requirements of the Mechanics' Lien Law, and, therefore, it has not commenced actions to obtain judgment upon the mechanics' lien claims filed.

Terra argues Bricklayers, supra, stands for the proposition that the technical requirements of the Mechanics' Lien Law should be interpreted under a liberal statutory construction and therefore, it did not need to file a complaint under a separate term and number to enforce a lien. Rather, Terra claims it just needed to file a complaint with the Prothonotary. We find Terra's argument is flawed and that Bricklayers is distinguishable from the present matter.

In Bricklayers, the trustees of employee benefit funds filed mechanics' lien claims for unpaid contributions owed to union members as a result of collective bargaining agreements between a contractor and the unions. The Court was asked to determine whether the trustees had standing to assert the mechanics' liens because a trustee was not considered a "subcontractor" under the law since it did not perform work on, or furnish materials to, a project. Bricklayers, 41 A.3d at 19.

The Court initially noted the following:
[I]n interpreting the Mechanics' Lien Law of 1963, this Court's case law is replete with reiterations of the following phrase: "Mechanics' liens were non-existent at common law, being purely of statutory origin. As they are in derogation of the common law and since they effectively represent a special remedy in favor of a unique class of creditors, our courts have generally reviewed such claims with a strict construction of the statute which created them." Sampson-Miller Associated Cos. V. Landmark Realty Co., 224 Pa.Super. 25, 303 A.2d 43 (Pa.Super. 1973)[.]

Bricklayers, 41 A.3d at 24 (citations omitted).

The Court analyzed statutory construction[9] relative to the Mechanics' Lien Law and held that the "statute must be 'liberally construed to effect [its] objects and promote justice, '… regardless of any previous case law proclamation to the contrary." Id. at 24-25. The Court concluded the definition "subcontractor" in the Mechanics' Lien Law was entitled to liberal construction and based on the facts set forth in the complaints, the unions had the necessary "contracts" with the contractor and qualified as "subcontractors" as defined by the law. The Court also determined the trustees, as representatives of members of the unions, had standing to file the mechanics' liens. Id. at 23.[10]

Nevertheless, the Court limited its holding to the issue at hand, elaborating that while the "substantive scope" of the Mechanics' Lien Law "defining the class of available lien claimants" was to be given a liberal construction, "a strict compliance standard may be used to determine certain issues of notice and/or service … because the notice and service requirements of the Mechanics' Lien Law pertain to the creation and perfection of a lien claim (procedural requirements)[.]" Id. at 28-29. (emphasis added). Therefore, Terra's argument that based on Bricklayers, the Mechanics' Lien Law may only be viewed through the lens of liberal construction is erroneous. Furthermore, Bricklayers is distinguishable from the present matter as it applied a liberal construction to the substantive scope of the statute and did not expand such interpretation to the procedural requirements of the statute.

Additionally, Terra asserts that even if its claims were strictly construed the trial court was obligated to view the complaint to enforce the lien claims in light of the doctrine of substantial compliance. We find that the doctrine of substantial compliance is not applicable in the present matter based on our above analysis. Both Tully and Bricklayers uphold a strict compliance standard with respect to the procedural requirements for a mechanics' lien claim.[11]

With respect to Terra's remaining three claims, we will address them together. Terra contends the court erred by not granting Terra leave to file a complaint under a separate court term and number from the mechanics' lien claim.[12] Additionally, Terra argues the trial court does not have a local rule governing the filing of such complaints and the local practice is to file the complaint under either the same court term and number as the mechanics' lien claim or to a separate court term and number.

With respect to these claims, the trial court found the following:
[Terra] purports to raise three other issues in its statement of matters (sic) complained of on appeal. None are properly preserved for review and none have any merit. [Terra] contends that we erred in striking the complaint without granting it leave to file a complaint to a separate term and number. We were not requested to grant such leave but while we did not grant such leave neither did we prohibit such filing. To the extent, if any, that [Terra] had the right to file a complaint to a new term and number, nothing in our order abrogates such right. Next [Terra] contends that we erred in striking the complaint "when the Court of Common Pleas of Chester County has no local rule governing the filing of such Complaints." [Terra] is correct that there is no local rule governing the filing of complaints to obtain judgment upon a mechanics' lien claim but that fact is irrelevant. Our decision was based on the Pennsylvania Rules of Civil Procedure which, as noted above, by statute, are controlling on the practice and procedure to obtain judgment upon a claim filed. Mechanics' Lien Law of 1963, § 701, 49 P.S. § 1701.
Finally, [Terra] contends that we erred in striking the complaint "when the local practice of the Court of Common Pleas of Chester County is to file the Complaint under either the same Court Term and Number as the Mechanic's (sic) Lien Claim or to a separate Court Term and Number." In the first place, the existence of such a "local practice" is not a matter of record but even if it were and even if the practice were as described in [Terra]'s statement, a "local practice" cannot overrule the Pennsylvania Rules of Civil Procedure and the authority of the appellate courts of Pennsylvania.

Trial Court Opinion, 9/19/2012, at 5 (emphasis in original). Having carefully reviewed the record, and mindful of our standard of review, we conclude that the trial court has properly disposed of these remaining issues and we need not address them further. Accordingly, we conclude the court did not err in sustaining River Station's preliminary objections and striking Terra's complaint.

Orders affirmed.

Judgment Entered.


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