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Electrical Wholesale Supply Co., Inc. v. Fraser

Supreme Court of Wyoming

August 14, 2015

ELECTRICAL WHOLESALE SUPPLY CO., INC., an Idaho Corporation, Petitioner,
v.
ALANE FRASER, an Individual; and M.J. BISHOP CONCRETE & CONSTRUCTION, INC., a Wyoming Corporation, Respondents

Page 255

Original Proceeding Petition for Writ of Review From the District Court of Teton County. The Honorable Timothy C. Day, Judge.

Representing Petitioner: Mitchell H. Edwards and Julie M. Wickett of Nicholas & Tangeman, LLC, Laramie, Wyoming. Argument by Mr. Edwards.

Representing Respondent Alane Fraser: Bret F. King of King & King, LLC, Jackson, Wyoming. No appearance.

Representing Respondent M.J. Bishop Concrete & Construction, Inc.: William R. Fix, Jackson, Wyoming.

Before BURKE, C.J., and HILL, KITE[*], DAVIS, and FOX, JJ.

OPINION

Page 256

KITE, Justice.

[¶1] Electrical Wholesale Supply Co. (EWS) filed this action in circuit court, seeking payment for electrical materials it supplied to a commercial building remodel in Jackson, Wyoming. The circuit court denied EWS's claims, and we granted a writ of review pursuant to W.R.A.P. 13.01, et seq. after the district court affirmed the circuit court's rulings. EWS asserts the circuit court erred by declaring its lien against Alane Fraser's[1] property invalid for failing to follow the statutory notice requirements. EWS also challenges the circuit court's denial of its unjust enrichment claim against Ms. Fraser and the general contractor, M.J. Bishop Concrete & Construction, Inc. (Bishop Construction).

[¶2] We conclude the circuit court applied the wrong statute to the lien notice issue and erred by granting summary judgment in favor of Ms. Fraser on the lien claim. However, we agree with the circuit court that EWS did not prove its unjust enrichment claim. We, therefore, affirm in part, reverse in part, and remand for further proceedings consistent with this opinion.

ISSUES

[¶3] The dispositive issues in this case are:

1. Whether the circuit court applied the correct lien notification statute under the circumstances of this case.

2. Whether EWS provided timely notice of its filed lien to the property owner.

3. Whether EWS proved the elements of unjust enrichment.

FACTS

[¶4] Ms. Fraser hired Bishop Construction to remodel her commercial property in Jackson, Wyoming. Bishop Construction subcontracted with Jackson Hole Electric, Inc., also referred to as JHE 2, Inc., (hereinafter JHE) to perform electrical work on the project. Dusty Jones, vice-president of JHE, opened a general account with EWS, an electrical materials supplier, in July 2010. He also opened a job account for the Fraser project, called the Rafter J Café, in November 2010. JHE's application for the job account listed and provided addresses for Ms. Fraser as the owner, Bishop Construction as the general contractor, and JHE as the electrical contractor.

[¶5] On November 30, 2010, EWS notified Ms. Fraser and Bishop Construction that it was providing materials for the project. In the notice, EWS provided its contact information, including the address and telephone number for making payments. The notice also stated:

6) This document hereby constitutes notice of Electrical Wholesale Supply Co., Inc.'s right to claim a lien against the building or improvements upon the real property for materials furnished.
In the even[t] that this job constitutes a " single family dwelling unit" as also described by the Wyoming statutes,[2] the following additional notice is also given:

Page 257

NOTICE TO OWNER

FAILURE OF THIS PRIME CONTRACTOR OR SUBCONTRACTOR TO PAY THOSE PERSONS SUPPLYING MATERIALS OR SERVICES TO COMPLETE THIS CONTRACT CAN RESULT IN THE FILING OF A MECHANIC'S LIEN ON THE PROPERTY WHICH IS THE SUBJECT OF THIS CONTRACT PURSUANT TO W.S. 29-2-101 THROUGH 29-2-110. TO AVOID THIS RESULT, WHEN PAYING FOR LABOR AND MATERIALS YOU MAY ASK THIS PRIME CONTRACTOR OR SUBCONTRACTOR FOR " LIEN WAIVERS" FROM ALL PERSONS SUPPLYING MATERIALS OR SERVICES FOR THE WORK DESCRIBED IN THIS CONTRACT. FAILURE TO SECURE LIEN WAIVERS MAY RESULT IN YOU PAYING FOR LABOR AND MATERIALS TWICE.

[¶6] EWS sent the notice to Ms. Fraser and Bishop Construction by certified mail, return receipt requested, as then required by Wyo. Stat. Ann. § § 29-2-110 and 29-2-111 (LexisNexis 2010). Although the mailing addresses used by EWS were incorrect in some respects, the notices were delivered by the post office and signed for by representatives of the respective addressees. Ms. Fraser and Mr. Bishop specifically acknowledged receiving the notices.

[¶7] EWS supplied materials to JHE for use on the Rafter J Café project and regularly submitted invoices to JHE for payment. JHE paid the invoices for the first several months of the project, but in June 2011 began falling behind in its payments. The unpaid principal amount was $18,495.94.

[¶8] In the meantime, JHE submitted bills of over $92,000 to Bishop Construction for electrical work and materials on the job, and Bishop Construction paid JHE in full. Bishop Construction then billed Ms. Fraser over $1,000,000 for work on the project (including the electrical work), which she paid in full. Neither Bishop Construction nor Ms. Fraser requested lien waivers from EWS or JHE when they made their payments. JHE consolidated its revenue from all of its jobs and used the money to pay outstanding bills. With regard to its EWS accounts, JHE tended to pay those that had been in arrears the longest.

[¶9] In accordance with its policy, EWS suspended JHE's Rafter J Café account in September 2011 because it was more than sixty days past due. The café opened on November 11, 2011, and a few days later, November 16, 2011, EWS's legal counsel mailed a letter to Ms. Fraser, with copies to Bishop Construction and JHE, giving notice of its intent to file a lien against her property if the outstanding balance was not paid. The letter was certified and Ms. Fraser's teenaged son signed for it on December 6, 2011. Although Ms. Fraser could not recall when she first saw the letter, she did review it at some point and learned that EWS had not been paid. Mike Bishop of Bishop Construction did not remember receiving the letter, but became aware of it when he met with Ms. Fraser and Mr. Jones in late November or early December 2011 to discuss the situation. Ms. Fraser offered to pay EWS $15,000 to resolve the issue, but EWS rejected the offer. Mr. Jones assured her and Mr. Bishop that he would make arrangements to pay the bill, but he did not. On December 22, 2011, EWS recorded a lien against Ms. Fraser's property. It sent notice of its lien to Ms. Fraser on December 29, 2011.

[¶10] On May 31, 2012, EWS filed an action in the circuit court in Teton County, naming Ms. Fraser, Bishop Construction, JHE, and Mr. Jones as defendants.[3] The complaint included causes of action for foreclosure of a construction lien, breach of contract,

Page 258

unjust enrichment, and third party beneficiary. Mr. Jones and JHE failed to respond to the complaint and default was entered against them; however, JHE is defunct and EWS was unable to collect its judgment against either the company or Mr. Jones. EWS's third party beneficiary claim was dismissed with its consent.

[¶11] Ms. Fraser filed a motion for summary judgment on EWS's lien claim. She argued the lien was not effective because EWS had not complied with the statute which required it to send her notice of the lien within five days after it was filed. The circuit court held a hearing on the summary judgment motion and concluded the statute required mailing of a notice of the lien within five calendar days after recording and EWS had not complied with its obligation. The circuit court, therefore, granted summary judgment in favor of Ms. Fraser, declaring the lien invalid. It subsequently denied EWS's motion for reconsideration of its summary judgment decision. The circuit court held a bench trial on EWS's unjust enrichment claim and entered judgment in favor of Ms. Fraser and Bishop Construction, concluding they did not have notice that EWS expected them to pay for the materials.

[¶12] EWS appealed to the district court, which affirmed the circuit court decisions. EWS then filed a petition for writ of review with the Wyoming Supreme Court, ...


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