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City Electric Supply Co. v. Arch Insurance Co.

Supreme Judicial Court of Massachusetts, Norfolk

March 29, 2019

CITY ELECTRIC SUPPLY COMPANY[1]
v.
ARCH INSURANCE COMPANY.

          November 8, 2018.

         The case was heard by Beverly J. Cannone, J., on a motion for summary judgment.

         The Supreme Judicial Court granted an application for direct appellate review.

          Thomas E. Day for the plaintiff.

          John W. DiNicola, II, for the defendant.

          Present: Gants, C.J., Gaziano, Lowy, Budd, Cypher, & Kafker, JJ.

          GAZIANO, J.

         In this case, we consider whether a claimant seeking to enforce a target lien bond by commencing a civil action pursuant to the mechanic's lien statute, G. L. c. 254, § 14, must record an attested copy of the complaint in the registry of deeds. We conclude that the lien statute contains no such requirement. A party seeking to enforce a target lien bond, a bond which has the effect of dissolving a mechanic's lien that has been placed on a property, need not record a copy of a complaint in the registry of deeds as a condition precedent to enforcing the bond.

         1. Background. The essential facts are undisputed. City Electric Supply Company, doing business as Concord Electric Supply, Ltd. (CES), supplied electrical materials for a construction project in Brookline to subcontractor Michael Franciosi, doing business as Electrical Professionals (Franciosi). In June 2016, CES perfected a mechanic's lien on the Brookline property by recording a notice of contract in the Norfolk County registry of deeds pursuant to G. L. c. 254, § 4; the notice indicated that Franciosi owed CES $283, 056.54. Months later, Franciosi filed a suggestion of bankruptcy in the Superior Court.

         On July 14, 2016, general contractor Tocci Building Corporation (Tocci) issued and recorded a "target lien bond, "[2] pursuant to G. L. c. 254, § 14, in the amount of $283, 056.54, the amount of the mechanic's lien that CES had created. The target lien bond listed the defendant, Arch Insurance Company (Arch), as surety, and was recorded in the Norfolk County registry of deeds.

         In August, 2016, CES sought to enforce the target lien bond by filing a timely action against Franciosi and Arch in the Superior Court, pursuant to G. L. c. 254, § 14. CES properly served Franciosi and Arch. CES did not record a copy of its complaint in the registry of deeds within thirty days of commencement of the action.[3]

         In March, 2017, Arch moved for summary judgment pursuant to Mass. R. Civ. P. 56, 365 Mass. 824 (1974); it argued that CES had failed to comply with G. L. c. 254. Specifically, Arch alleged that CES had not recorded in the registry of deeds an attested copy of its complaint to enforce the target lien bond within thirty days of filing the complaint, as would have been required in a lien enforcement action under G. L. c. 254, § 5. CES opposed the motion "on the grounds that suit on a lien bond under [G. L. c. 254, § 14, ] does not require an attested copy of the complaint to be recorded and Arch's interpretation of the lien bond requirement is erroneous."

         Following a hearing, a Superior Court judge allowed Arch's motion for summary judgment. The judge reasoned that G. L. c. 254, § 14, must be read in conjunction with "the detailed and precise requirements of [§] 5, which dictate the procedures for a lien enforcement action." As G. L. c. 254, § 5, requires that an attested copy of a complaint be recorded, the judge "reject[ed] [CES's] claim that because G. L. c. 254, § 14, is silent with respect to filing an attested copy of the complaint, it was excused from doing so within the thirty days of the commencement of the action as required by G. L. c. 254, § 5." CES filed a timely appeal. We allowed CES's petition for direct appellate review.

         2. Statutory scheme. General Laws c. 254 "governs the creation, perfection, and dissolution of a mechanic's lien." National Lumber Co. v. United Cas. & Sur. Ins. Co., 440 Mass. 723, 726 (2004) (National Lumber II). Because a perfected lien encumbers the property upon which it is placed, one purpose of G. L. c. 254 is "to ensure that a person searching the land records in a registry of deeds can determine with certainty whether or not title to a particular parcel of land is encumbered by a mechanic's lien." National Lumber Co. v. LeFrancois Constr. Corp., 430 Mass. 663, 668 (2000) (National Lumber I). Another important "purpose of G. L. c. 254 is 'to provide security to contractors, subcontractors, laborers, and suppliers for the value of their services and goods provided for improving the owner's real estate.'" I_d., quoting Hammill-McCormick Assocs., Inc. v. New England Tel. & Tel. Co., 399 Mass. 541, 542-543 (1987). "Because a mechanic's lien is purely a creation of statute, we have consistently required exact compliance with the statute in order to create, perfect, and enforce such a lien." Golden v. General Bldrs. Supply LLC, 441 Mass. 652, 654 ...


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