CONSTRUCTION CASE
LAW SUMMARIES
Construction
Liens
July 2011
PUBLISHED BY: CCL CONSTRUCTION
CONSULTANTS, INC. AT SMASHWORDS
COPYRIGHT 2011 BY CCL
CONSTRUCTION CONSULTANTS, INC.
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Construction Case
Law Summaries
Construction Lien cases:
July 2011
In this publication:
Subsequent construction contract not signed does not invalidate a prior valid contract.
Services charges for late payment may be included in the amount of a Michigan lien.
A Lienholder may not enter into private agreements to waive or subordinate their rights in Utah.
In North Carolina, partial lien waivers do not affect the priority of a lien claimant.
Subsequent construction
contract not signed does not invalidate a prior valid contract
In
Sam Rodgers Properties
v. Chmura, 2011 Fla.
App. LEXIS 5943 (Fla. Dist. Ct. App. 2d Dist. Apr. 27, 2011), the
court held that a subsequent construction contract that was not
signed did not invalidate a prior valid contract. A homeowner had
hired a contractor for the construction of a custom home. The
homeowner signed a contract to build the house on a specified lot for
a specified price. However, a second contract was submitted by the
contractor calling for an additional ten thousand dollars. The
contractor failed to attain the homeowner’s signature on the second
contract or any other document indicating that the price had been
changed. The homeowner sent letters to the contractor concerning the
price increase but took no measures in stopping the construction of
the home. The contractor requested two draw payments that the
homeowner failed to pay. The contractor then halted construction and
recorded a claim of lien for the work completed. In order to keep the
investment safe from the elements and vandals, the contractor
completed an additional amount of work on the home. An amended claim
of lien was then filed within 90 days and reflected the additional
amount of construction costs. Two months after the claim of lien was
recorded, the contractor filed a lawsuit to foreclose the lien. The
homeowner counterclaimed against the contractor for rescission. The
trial court found the claim of lien was void. The homeowner argued on
appeal that the contractor began construction of the home without a
valid contract, that there was never a meeting of the minds, and no
signed contract to prove otherwise. The contractor argued that even
if the second contract was unenforceable, the homeowner was still
bound by the original, enforceable written contract. A breach of
contract required the contractor to prove that there was a “meeting
of the minds” and mutual assent to all essential terms of the
contract. The parties satisfied the meeting of the minds requirement
by assenting to the lot chosen and the price of the lot as well as
the initial base price for the construction of the house. The
original contract was valid and enforceable. Because there was a
binding initial contract, the breach of that contract by the
homeowner entitled the contractor to damages. The trial court’s
ruling was reversed.