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| Frank Kosir, Jr. fk@muslaw.com |
This matter addressed the issue of whether a
subcontractor retained to complete site preparation work for the construction
of commercial buildings can assert a mechanic’s lien claim even though the
contemplated structure were never constructed. Warihay Enterprises, Inc. (“General
Contractor”) was retained by PBC Hollow-A, L.P. and PBC Hollow-B, L.P.
(“Owners”) to construct two commercial office buildings on the Owners’ real
property (“Property”) situated in Phoenixville, Pennsylvania. The General Contractor subsequently entered
into a contract with B.N. Excavating, Inc. (“Subcontractor”) pursuant to which
the Subcontractor was to provide “labor and materials for excavation work,
including but not limited to, a silt fence, temporary riser, emergency
spillway, topsoil stripping, cut and fill, concrete pipe, sub-grading for
building pad, storm water bed, rock ribbing and other site work.” The Subcontractor completed all of the
contracted-for work on December 18, 2008, in accordance with its contract. However, construction of the commercial
buildings never commenced.
After
its demands for payment were denied, on June 8, 2009, the Subcontractor filed a
notice of mechanics’ lien claim in the amount of $118,670.71, and subsequently
filed a Complaint on the lien. In
response, the Owners filed Preliminary Objections asserting, inter alia,
that, as the buildings were never constructed, the Subcontractor’s work was not
incidental to construction, and no mechanics’ lien claims could be
asserted. The trial court, concluding
that the lack of any constructed buildings on the Property precluded the
assertion of a mechanics’ lien claim, sustained the Preliminary Objections and
dismissed the mechanics’ lien with prejudice.
On
appeal, our Superior Court reversed. In
issuing its ruling, the court noted that Pennsylvania’s Mechanics’ Lien Law
does not require that the erection, repair or construction of the improvement
at issue be completed. Rather, the Law
only requires that any excavation or other preliminary groundwork completed be
undertaken in conjunction with the erection, repair or construction of the
improvement. In this instance, the
Subcontractor’s Complaint included numerous factual allegations that the work
it had performed was completed in anticipation of the construction of the
commercial buildings. As such, the trial
court had erred in dismissing the Complaint on Preliminary Objections, and the
matter had to be remanded to the trial court for a hearing on the issue of
whether the work completed was, in fact, incidental to the planned construction
of the office buildings.
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