Daily Development for
Thursday, October 22, 1998

by: Patrick A. Randolph, Jr.
Professor of Law
UMKC School of Law
Of Counsel: Blackwell Sanders Peper Martin
Kansas City, Missouri

MECHANICS' LIENS; ENVIRONMENTAL CLEANUP: A subcontractor's removal, treatment and disposal of contaminated soil from real property is not an "improvement" that qualifies for a mechanics' lien.

TPST Soil Recyclers v. W.F. Anderson, 957 P.2d 265 (Wash. App. Div. 2 1998).

In a case of first impression, the Washington Court of Appeals held that the subcontractor's removal, treatment, and disposal of contaminated soil from real property was not an "improvement" that qualified for a mechanics' lien under the Utah statute. The court commented that the mechanics' lien statute is in derogation of the common law and must be strictly construed. The language of the statute in question did not include "removal" or "hauling away" as a basis for the statutory benefit of a lien. In the view of the court, the subcontractor merely removed debris and was not involved in an overall plan to improve the property.

Comment: Such cases, of course, are difficult to rely upon as precedent because mechanic's lien language in each state is unique. But the common law precedents the court refers to here suggest that the issue is far less resolved than the court's discussion might suggest.

The court cited decisions in three other jurisdictions that have reached similar conclusions. One of these HazMat Response, Inc. v. Certified Waste Services Limited, 896 P.2d 393 (Kan.App. 1995, the Dirt Daily Development for December 20, 1995, is not strong authority for the conclusions reached by the Utah court. The HazMat court indicated that it was not basing its conclusion on the fact that the work of improvement did not result in the development of any new structure, but rather because it constituted a maintenance project, rather than an improvement project. It would seem where, as in the instant case, the work substantially enhanced the value of the property in question, and was more than "routine maintenance," the Kansas court might have found the statute applicable. Further, in HazMat, the court indicated that the contractor might be able to obtain restitution from the party benefitting from its work (the current owner) even if that party was not in privity with the contractor.

The other case supporting the court's decision here was a bankruptcy case, In re Finevest Foods, Inc., 165 B.R. 949, 94555 (Bkrtcy. M.D. Fla. 1994). DIRT contains abundant evidence that such cases rarely can be relied upon as signficant precedent for common law decisions, as they usually are very result oriented. The third case, Cleveland Wrecking Co. v. Central Nat'l Bank, 576 N.E. 2d 1055, 1060 (Ill. App. 1991) actually found that the mechanic's lien statute did cover the work in question - the removal of a structure as part of an environmental remediation - but the Utah court cited it for the dicta differentiating a situation in which no building was involved.

Items in the Daily Development section generally are extracted from the Quarterly Report on Developments in Real Estate Law, published by the ABA Section on Real Property, Probate & Trust Law. Subscriptions to the Quarterly Report are available to Section members only. The cost is nominal. For the last six years, these Reports have been collated, updated, indexed and bound into an Annual Survey of Developments in Real Estate Law, volumes 16, published by the ABA Press. The Annual Survey volumes are available for sale to the public. For the Report or the Survey, contact Maria Tabor at the ABA. (312) 988 5590 or mtabor@staff.abanet.org

Items reported here and in the ABA publications are for general information purposes only and should not be relied upon in the course of representation or in the forming of decisions in legal matters. The same is true of all commentary provided by contributors to the DIRT list. Accuracy of data and opinions expressed are the sole responsibility of the DIRT editor and are in no sense the publication of the ABA.