Summary
In Lew Hammer, Inc. v. Dash, Inc., 42 Colo.App. 414, 416–17, 599 P.2d 948, 949–50 (1979), a division of this court addressed this statutory provision, and held that it applies to the construction of new improvements as distinguished from expansion, repair, and remodeling of existing improvements.
Summary of this case from Ferguson Enters., Inc. v. Keybuild Solutions, Inc.Opinion
No. 78-234
Decided May 3, 1979. Rehearing denied June 14, 1979. Certiorari denied August 20, 1979.
In an action to foreclose a mechanic's lien, landscaping contractor appealed from a judgment which determined that any lien claimed by it was inferior to the liens of holders of deeds of trust.
Affirmed
1. MECHANICS' LIENS — Landscaping — Expansion — Existing Improvement — Not Have Priority — Holders — Deeds of Trust. Where landscaping is added to land upon which other improvements have already been erected, the landscaping constitutes the expansion of an existing improvement, rather than the construction of a new improvement; hence, § 38-22-103(2), C.R.S. 1973, does not operate to accord a mechanic's lien asserted relative to that landscaping priority over liens accorded to holders of deeds of trust.
Appeal from the District Court of Pueblo County, Honorable Thomas F. Phelps, Judge.
Fuller Evans, Clyde A. Faatz, Jr., William H. Lawrence, for plaintiff-appellant.
Thomas E. Jagger, for defendant-appellee Dash, Inc.
Gorsuch, Kirgis, Campbell, Walker Grover, C. Willing Browne, Gary S. Cohen, for defendant-appellee Beneficial Standard Mortgage Investors.
In an action to foreclose a mechanic's lien, plaintiff, Lew Hammer, Inc., appeals from a judgment which determined that any lien claimed by Hammer was inferior to the liens of the defendants, Beneficial Standard Mortgage Investors and Dash, Inc. We affirm.
Insofar as pertinent here, the record reflects that defendant, Hollydot Park Company, owned a large tract of land and in 1971 erected two buildings on that part described as Lot 1. Hollydot subsequently engaged an engineering firm to commence development of the Hollydot Park Subdivision, which included Lot 1 and a lake area, and which contemplated numerous building sites and assorted sports facilities. A loan was obtained from Beneficial to finance the construction.
The lot sales did not materialize as originally contemplated and as a result, Hollydot borrowed additional money and secured the loan by a deed of trust on Lot 1, which was recorded September 28, 1973, and subsequently was assigned to Dash, Inc. Hollydot also renegotiated its loan with Beneficial, and a second deed of trust on the balance of the subdivision, excluding Lot 1, was recorded April 17, 1974.
A new sales agent, defendant T-R Development Corporation, was engaged to sell the lots in 1974, and it recommended that additional landscaping be undertaken to make the area more attractive to prospective purchasers. A contract was signed wherein Hammer agreed to provide landscaping for Lot 1, the golf course, the golf clubhouse, the turf club, swimming pool, and tennis courts. T-R advanced $50,000 to Hammer, and the remaining $95,000 called for by the contract was to be paid by Hollydot in installments.
Both Beneficial and Dash subsequently foreclosed and obtained title to the property. Thereafter Hammer sought to foreclose its lien.
Following a trial to the court, it found that: (1) Lot 1 was totally independent from the Hollydot Park Subdivision; and, (2) Hammer's landscaping work on the remainder of the subdivision was a new project unrelated to the original plan. Because Hammer's work on the landscaping commenced approximately July 24, 1974, the court concluded that any lien claimed by Hammer pursuant to § 38-22-106, C.R.S. 1973, was subordinate to the lien of Beneficial and Dash.
I.
Contrary to Hammer's contention, there was competent evidence to support the findings of the trial court enumerated above, and thus those findings must be affirmed on appeal. Broncucia v. McGee, 173 Colo. 22, 475 P.2d 336 (1970).
Substantial evidence was introduced which supports the trial court's finding that erection of the buildings on Lot 1 was a separate project. As to the second finding, the Hollydot corporate lawyer testified that no landscaping plans for the plaintiff's work existed at the commencement of the subdivision and that the loan agreement with Beneficial did not authorize landscaping expenditures. The Hollydot president confirmed this testimony, and the president of the first sales agency involved with the subdivision stated that landscaping expenditures were not contemplated.
Based upon the foregoing, we need not address Hammer's other contentions relative to the trial court's findings.
II.
Hammer alternatively contends that it has a superior lien upon the landscaping itself pursuant to § 38-22-103(2), C.R.S. 1973, which provides that:
"When the lien is for work done or material furnished for any entire structure, erection, or improvement, such lien shall attach to such building, erection, or improvement for or upon which the work was done . . . in preference to any prior lien . . . ." (emphasis supplied)
We disagree.
[1] Section 38-22-103(2), C.R.S. 1973, applies to the construction of new improvements as distinguished from expansion, repair, and remodeling of existing improvements. See Stinnett v. Modern Homes, 142 Colo. 176, 350 P.2d 197 (1960). And, it is uncontroverted that all of the landscaping was adjacent to existing structures and improvements in the subdivision, namely, the buildings on Lot 1, the golf course, golf clubhouse, tennis courts, swimming pool, and turf club. We conclude that where, as here, landscaping is added to land upon which other improvements have already been erected, the landscaping constitutes the expansion of an existing improvement. See Atkinson v. Colorado Title Trust Co., 59 Colo. 528, 151 P. 457 (1915). Otherwise, the lien of a lender on residential property would lose its priority if a homeowner were unable to pay for landscaping adjacent to his residence — a result we believe to be contrary to the intent of the statute. See Stinnett, supra. Hence, we hold that Hammer's lien is subordinate to that of Beneficial and Dash.
Judgment affirmed.
JUDGE BERMAN and JUDGE KELLY concur.