Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Beacon Construction Co. v. Matco Electric Co.

August 13, 1975

BEACON CONSTRUCTION COMPANY, INC., PLAINTIFF-APPELLEE,
v.
MATCO ELECTRIC COMPANY, INC., D/B/A DWYER ELECTRIC CO., INC., DEFENDANT-APPELLANT.



Appeal from judgment of the United States District Court for the Western District of New York, Harold P. Burke, Judge, declaring null and void a notice of mechanic's lien and a bond discharging the lien and awarding damages in amount of bond premium. Affirmed.

Author: Jameson

Before: SMITH, Senior Circuit Judge, OAKES, Circuit Judge, and JAMESON, Senior District Judge.*fn*

JAMESON, District Judge:

This is an appeal from a summary judgment in favor of plaintiff-appellee, Beacon Construction Company, Inc. (Beacon) declaring null and void a notice of lien filed by defendant-appellant, Matco Electric Company, Inc. (Matco) and a surety bond given by Beacon to dissolve the lien, and awarding Beacon $3,516.00, the premium paid for the bond.

Background

Matco, a New York corporation, entered into a subcontract with Beacon, a Massachusetts corporation, to furnish and install an electrical system for a housing project Beacon was constructing in Rochester, New York pursuant to a general contract with the owner. Under the subcontract Matco expressly waived its right to file a mechanic's lien under New York law, paragraph 14 providing:

"The Subcontractor hereby agrees that no mechanic's or other lien... shall be filed or maintained by it against the said building and improvements and real estate appurtenant thereto, or any part thereof, for or on account of any work or labor done or materials furnished under this Subcontract... in or about the erection and construction of said buildings and improvements and that the filing of any lien... shall be grounds for termination of this Subcontract under the provisions of Paragraph 9 above. The Subcontractor hereby formally and irrevocably releases and waives any and every mechanic's, materialman's and any and every other lien,... that it has or may at any time be entitled to have against the aforementioned buildings, improvements and real estate, together with its right to file any and every such lien.... The subcontractor hereby irrevocably constitutes the Contractor its agent to discharge any liens... which may be filed by or on behalf of the Subcontractor against the property."

Despite this contractual provision, Matco filed a notice of mechanic's lien in the office of the county clerk on August 29, 1974 in the amount of $293,001.52. The filing of the lien placed an encumbrance on the property and had the effect of impeding or preventing the release of funds by the construction lender.*fn1

On September 11, 1974, this action was filed pursuant to 28 U.S.C. § 1332, in which Beacon sought a judgment under the Declaratory Judgment Act, 28 U.S.C. § 2201, declaring mechanic's lien null and void.*fn2 On October 3, 1974, Matco filed an action against Beacon in the Supreme Court, State of New York, to impress a lien pursuant to Article 3A, Lien Law, State of New York.*fn3 On the same date a surety bond in the amount of $351,601.82 was filed, and the mechanic's lien was thereby discharged.*fn4

On October 23, 1974 Matco filed a motion to dismiss for failure to state a claim for which relief can be granted; or, in the alternative, for summary judgment or security for costs. On October 29, 1974 Beacon filed an amended complaint, seeking as additional relief a declaration that the bond was void and an award for the amount of the bond premium. On the same date Beacon filed a motion for summary judgment.

In granting Beacon's motion the district court held that "the defendant breached its contract with the plaintiff, when, on August 29, 1974 it caused to be filed a notice of lien"; that the lien was "null and void", the bond was void and plaintiff was entitled to recover the premium it had paid for the bond.

Matco contends on appeal that (1) the amended complaint does not state a claim for which relief can be granted pursuant to the New York Lien Law; (2) the federal courts lack jurisdiction because the amount in controversy does not exceed $10,000; and (3) Beacon was not entitled to recover the bond premium because other alternatives were available which would not have required the payment of a bond premium.

I. Does Amended Complaint State a Claim ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.