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Buchanan v. Overley

March 7, 2008

DOUGLAS BUCHANAN, APPELLEE,
v.
JERRY W. OVERLEY AND CAROL J. OVERLEY, APPELLANTS, AND COMMUNITY BANK OF WICHITA, INC., APPELLEE.



Appeal from Sedgwick District Court; KARL W. FRIEDEL, judge.

SYLLABUS BY THE COURT

1. Whether a mechanic's lien statement complies with K.S.A. 60-1102 is a question of law over which an appellate court exercises unlimited review.

2. K.S.A. 60-1102(a) requires that a verified mechanic's lien statement include "the name and address sufficient for service of process of the claimant."

3. The purpose of a mechanic's lien statute is to afford security to persons or entities furnishing labor, equipment, material, or supplies used or consumed for the improvement of real property under a contract with the owner or the owner's general contractor. While courts liberally construe a mechanic's lien statute once a lien has attached, Kansas law requires strict compliance with the procedure prescribed in the statute in order to perfect a mechanic's lien.

4. K.S.A. 60-1102 does not require the filing of any particular form of mechanic's lien statement, only that the requisite information be included. A verified mechanic's lien statement need not be composed of a single document. In fact, K.S.A. 60-1102(a) specifically contemplates the incorporation by reference of information contained in an attachment to the mechanic's lien statement. K.S.A. 60-1102(a)(4) permits the attachment of a promissory note to the claim in lieu of an itemized statement. Nevertheless, Kansas law is clear that a mechanic's lien statement must not only contain the requisite information but also be fully verified.

5. Kansas law demands strict compliance with the statutory requirements in order to perfect a mechanic's lien. Equitable considerations do not ordinarily give rise to a mechanic's lien. Being created by statute, a mechanic's lien can only arise under the circumstances and in the manner prescribed by the statute. A lien claimant must secure a lien under the statute or not at all.

The opinion of the court was delivered by: McANANY, J.

Reversed.

Before GREENE, P.J., McANANY and BUSER, JJ.

This appeal raises issues regarding the validity of a mechanic's lien for services performed in the construction of a residence. The homeowners challenge the lien on the grounds that the form of the lien statement does not comply with the requirements of K.S.A. 60-1102(a) and it was not timely filed. Since resolution of this appeal turns on the adequacy of the mechanic's lien statement itself, we need not reach the timeliness issue. Thus, our recital of the facts is abbreviated to include only those necessary for consideration of the adequacy of the lien statement.

Jerry and Carol Overley contracted with Douglas Buchanan for the construction of a single-family home on land owned by the Overleys in Wichita. The parties also entered into an undated arbitration agreement which does not specifically refer to the project and which was not incorporated by reference into the construction contract. Nevertheless, the parties apparently treated the arbitration agreement as part of the construction contract.

During the course of construction the Overleys objected to the quality of Buchanan's work. Buchanan refused to make repairs satisfactory to the Overleys, and the Overleys stopped their progress payments to him. Buchanan gave the Overleys written notice of default pursuant to the contract. When the Overleys refused to cure the default, Buchanan initiated arbitration proceedings and filed his mechanic's lien statement.

The parties participated in arbitration proceedings, following which the arbitrators entered an award in favor of Buchanan in the amount of $49,542.64. Buchanan immediately filed an action in the district court to confirm the award. The Overleys objected and sought to vacate or modify the award. The district court denied relief to the Overleys and confirmed the arbitration award.

The Overleys then sought relief by filing their petition in bankruptcy. The parties later agreed that Buchanan could pursue a state mechanic's lien foreclosure action as an exception from the bankruptcy automatic stay. As a result, Buchanan filed a petition to foreclose his mechanic's lien. The Overleys unsuccessfully moved to dismiss the petition as untimely. They then moved for summary judgment, claiming that Buchanan's mechanic's lien statement was defective and had been filed untimely. The court denied summary judgment. Later the ...


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