Dat Luong DBA LVDH Construction v. Western Surety Co.

Notice: This opinion is subject to correction before publication in the PACIFIC REPORTER.
Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,
303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email
corrections@akcourts.us.
THE SUPREME COURT OF THE STATE OF ALASKA
DAT LUONG, d/b/a LVDH )
CONSTRUCTION, ) Supreme Court No. S-17593
)
Petitioner, ) Superior Court No. 3AN-18-06916 CI
)
v. ) OPINION
)
WESTERN SURETY COMPANY, ) No. 7519 – April 23, 2021
)
Respondent. )
)
Petition for Hearing from the Superior Court of the State of
Alaska, Third Judicial District, Anchorage, Michael L.
Wolverton, Judge, on appeal from the District Court of the
State of Alaska, Anchorage, Douglas Kossler, Judge.
Appearances: Dat Luong, pro se, Fresno, California,
Petitioner. Traeger Machetanz, Anne Marie Tavella, and
Chad Darcy, Davis Wright Tremaine LLP, Anchorage, for
Respondent.
Before: Bolger, Chief Justice, Winfree, Maassen, Carney,
and Borghesan, Justices.
BOLGER, Chief Justice.
I. INTRODUCTION
The employee of a subcontractor on a state public works project sued the
prime contractor’s surety bond for unpaid labor under Alaska’s Little Miller Act. The
trial court ruled the employee failed to give notice to the contractor within the statutorily
required 90 days of his last date of labor on the project. The trial court entered a directed
verdict against the employee. The employee appealed to the superior court, which
denied the appeal, and then petitioned this court for hearing.
We granted the petition to decide two issues of first impression: (1) how
to define “labor” and (2) whether “notice” is effective on the date of mailing or the date
of receipt. Under the Little Miller Act, we define “labor” as work that is “necessary to
and forwards” the project secured by the payment bond, and hold the effective date of
“notice” to be the date notice is sent via registered mail. We reverse the superior court’s
denial of Luong’s appeal, vacate the judgment against him, and remand for further
proceedings.
II. FACTS AND PROCEDURAL HISTORY
A. Facts
Earth Stone, Inc. hired Dat Luong in December 2014 to serve as vice
president and estimator. Earth Stone provided finish-concrete work for the prime
contractor, Pinnacle Construction, Inc., on a municipal library remodeling project.
Western Surety Company provided the surety bond for Pinnacle on the project.1
In early 2015 Luong performed a variety of tasks for Earth Stone on the
project, but by April he had stopped receiving consistent payment for his work.2 Many
1
AS 36.25.010(a)(2) requires that, for “contract[s] exceeding $100,000 for
the construction, alteration, or repair of a public building or public work,” the contractor
must supply “a payment bond with a corporate surety qualified to do business in the
state.”
2
A July 2015 letter from Earth Stone’s president and owner, Peggy Mitchell,
acknowledged that Earth Stone owed Luong $34,450 and indicated payment would be
provided after addressing some “financial difficulties.” Luong alleges he is actually
(continued...)
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of Luong’s duties were supervisory, but his work on the project included physical tasks
like mixing and pouring concrete. Luong helped with the last concrete pour at the
project on October 9, 2015. This is the last date that both parties agree Luong provided
labor on the project.
On January 6, 2016, 89 days after the last concrete pour, Luong requested
$8,379.90 in back wages from Pinnacle in a letter sent by registered and certified mail.
As confirmed by a signed receipt, Pinnacle received this letter on January 11, 94 days
after the final concrete pour. Western Surety asserts that Luong’s testimony is the only
evidence of when the letter was sent. But the letter is dated January 6, and Western
Surety presented no evidence the letter was mailed on a different date.
On July 26, Luong sent Pinnacle another letter reminding them he had yet
to be paid for his work on the project. This letter notified Pinnacle that Luong had
received a judgment in California against Earth Stone for work performed, and this
judgment had now been “effectuated and recorded in Alaska.”
B. Procedural History
Luong filed suit in small claims court, requesting $8,945.21 for unpaid
labor from Pinnacle’s payment bond with Western Surety under the Little Miller Act.3
The district court granted Western Surety’s request for formal procedures.
2
(...continued)
owed $58,000 for his unpaid work with Earth Stone on multiple projects, but decided to
pursue his case for less than $9,000 in small claims court to avoid legal expenses after
years of fighting for payment.
3
The Little Miller Act requires contractors for public works to furnish
payment bonds or sureties. AS 36.25.010. “A person who furnishes labor or material
in the prosecution of” such a public work but is not fully paid may sue for payment in
full on this bond. AS 36.25.020(a).
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Western Surety moved for summary judgment, arguing that no genuine
issue of material fact existed as to whether Luong’s supervisory work qualified as
“labor” under the Little Miller Act. The district court judge who initially oversaw the
case disagreed, observing a general consensus among courts in various jurisdictions
interpreting the term to at least include work performed at the job site.
After a transfer to a new district court judge, a bench trial was held over
three days in March and April of 2018. Three witnesses testified to the range of tasks
Luong performed on the project, including supervisory tasks on and off the project site
and physical labor involved with laying concrete at the project site. Luong testified that
he undertook these physical tasks — laying concrete, carrying materials, and cleaning
up the site — when chronic non-payment by Earth Stone led to a shortage of workers.
Earth Stone foreman Willie House specifically testified he and Luong were the only
employees left at the job site by October 9, 2015, the date of the last concrete pour.
At the close of Luong’s case, Western Surety moved for a directed verdict,
arguing Luong had not provided notice until January 11, 2016, and therefore needed to
prove he provided “labor” on or after October 13, 2015 in order to meet the 90-day
notice deadline for him to sue under the Little Miller Act.4 Western Surety emphasized
that it was the last day Luong provided “labor” on the project that was relevant, not the
last day he worked for Earth Stone in general. Luong responded that the January 6 letter
4
See AS 36.25.020(b) (for person whose contractual relationships were with
subcontractor, making right to sue payment bond dependent on “giving written notice
to the contractor within 90 days from the last date on which the person performed labor
or furnished material”).
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provided timely notice of his claim. Luong also asserted he performed labor even after
the October 9 concrete pour.5
The trial judge interpreted “labor” in the Little Miller Act to include
supervisory tasks only if they were performed on the job site. The judge concluded
Luong failed to establish he performed labor at the job site within 90 days of the notice
he provided to Pinnacle. The court noted that two of Luong’s exhibits indicate his last
day of work for Earth Stone at the project was October 9, 2015, more than 90 days
before January 11, 2016. The court assumed the operative date of notice was January 11,
2016, the date Pinnacle received the letter from Luong’s attorney. The trial judge
granted Western Surety’s motion for directed verdict and awarded attorneys’ fees to
Western Surety.
Luong appealed to the superior court, which denied his appeal. The
superior court did not address Luong’s notice argument. Rather, it too assumed Luong
“provided notice on January 11, 2016” and thus “must show that he performed labor on
or after October 13, 2015.” The superior court explained that neither the testimony nor
exhibits properly admitted into evidence at trial constituted “evidence that [Luong]
provided labor during the notice period.”6 The superior court did not attempt to define
the term “labor” under the Little Miller Act, nor did it attempt to specify when it
5
This claim rests on the foreman’s testimony that after concrete is poured,
at least two days must pass before the forms can be stripped and the site cleaned. The
foreman left the state after the last concrete pour, implying that Luong, as the last
remaining worker, must have later returned to the job site to strip the forms and do site
clean up. Luong also points to a journal entry discussing tasks he performed on the
project in late October, but this was not admitted into evidence.
6
The superior court noted the evidence did not provide “a specific timeframe
as to when the appellant performed labor,” adding that Luong’s diary entries were not
admitted as exhibits because Luong failed to lay appropriate foundation for them.
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considered the last day of “labor” to have been. Luong moved for reconsideration, which
the superior court denied.
Luong then filed a petition for hearing with this court. We granted Luong’s
petition on two issues of first impression regarding Alaska’s Little Miller Act: (1) what
constitutes “labor” under AS 36.25.020(b), and (2) whether the effective date of “notice”
under that section is the date of mailing or the date of receipt.
III. STANDARD OF REVIEW
“Determinations of which legal authorities apply in a case and
interpretations of what those legal authorities mean are questions of law subject to
de novo review.”7 “When applying the de novo standard of review, we apply our
‘independent judgment . . . adopting the rule of law most persuasive in light of precedent,
reason, and policy.’ ”8
IV. DISCUSSION
Alaska’s Little Miller Act requires prime contractors on public works
projects to maintain a payment bond.9 If “a person having direct contractual
relationships with a subcontractor” is not paid in full, that person “has a right of action
on the payment bond.”10 That right is conditioned on a requirement to “giv[e] written
7
ConocoPhillips Alaska, Inc. v. Williams Alaska Petroleum, Inc., 322 P.3d
114, 122 (Alaska 2014) (footnotes omitted).
8
Id. (quoting Russell ex rel. J.N. v. Virg-In, 258 P.3d 795, 802 (Alaska
2011)).
9
AS 36.25.010.
10
AS 36.25.020.
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notice to the contractor within 90 days from the last date on which the person performed
labor or furnished material for which the claim is made.”11
The statutory purpose of the Little Miller Act “is to protect persons who
furnish labor or material for a state public works project from the risks of
nonpayment.”12 In turn, the state is “assured that material and labor will be readily
furnished for its projects,” as people “who furnish labor and materials for the state’s
projects do so in reliance on the existence of a valid payment bond.”13
Alaska’s Little Miller Act is modeled after the federal Miller Act. When
resolving disputes brought under the Little Miller Act, we “give more weight to
principles derived from federal case law interpreting the Miller Act than to general
common law principles governing debtor-creditor relations.”14 We have previously said
that the Little Miller Act, “like the federal Miller Act, is remedial in nature and is to be
liberally construed to effectuate its purpose.”15
11
Id.
12State ex rel. White v. Neal & Sons, Inc., 489 P.2d 1016, 1020 (Alaska
1971), disapproved of on other grounds by Sea Lion Corp. v. Air Logistics of Alaska,
Inc., 787 P.2d 109 (Alaska 1990).
13
Id.
14State ex rel. Palmer Supply Co. v. Walsh & Co., Inc., 575 P.2d 1213, 1218
(Alaska 1978) (referring to AS 36.25.010).
15
SKW/Eskimos, Inc. v. Sentry Automatic Sprinkler Co., 723 P.2d 1293, 1297
(Alaska 1986); see also State ex rel. Smith v. Tyonek Timber, Inc., 680 P.2d 1148, 1157
(Alaska 1984) (“The Little Miller Act is the stepchild of the Federal Miller Act . . . . The
Alaska Act, like the Federal Act, is clearly remedial in nature. There is no question that
a remedial statute is to be liberally construed to effectuate its purposes.” (internal citation
omitted)); 40 U.S.C. §§ 3131-33 (2018).
(continued...)
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A. Luong Performed “Labor” Under Alaska’s Little Miller Act.
1. Under Alaska’s Little Miller Act, “labor” is work necessary to
the completion of a public works contract.
The United States Supreme Court has long favored a liberal construction
of “labor” and “materials” under the Miller Act and its predecessor, the Heard Act.16
The Court has “repeatedly refused to limit the application of the [A]ct to labor and
materials directly incorporated into the public work.”17 For instance, the Court explained
in U.S. Fidelity & Guaranty Co. v. Bartlett that “bids . . . to show samples of stone and
names and locations of quarries to be used as the source of supply” were “necessary to
the performance of the contract” and that associated work was “labor.”18 Even
15
(...continued)
Our previous cases have not always consistently applied or characterized
the principle that remedial statutes are to be liberally construed. See, e.g., D.H. Blattner
& Sons, Inc. v. N.M. Rothschild & Sons, Ltd., 55 P.3d 37, 45 & n.20 (Alaska 2002)
(stating that “once the determination of who qualifies as a lienholder is strictly
construed,” lien law’s purpose should “be liberally construed”). But see, e.g., Whitesides
v. U-Haul Co. of Alaska, 16 P.3d 729, 732 (Alaska 2001) (citing rule to liberally
construe remedial statutes as a reason to narrowly construe exemptions to employment
protections in the Alaska Wage and Hour Act). Regardless of these inconsistencies,
Western Surety has not argued that the liberal construction principle is inapplicable to
the Little Miller Act’s definition of “labor.” In the absence of briefing on the viability
and scope of the liberal construction principle in Alaska, we do not decide these issues
here.
16
See Brogan v. Nat’l Sur. Co., 246 U.S. 257, 261-62 (1918) (declaring that
the Heard Act “must be construed liberally for the protection of those who furnish labor
or materials in the prosecution of public work”); Fleisher Eng’g & Constr. Co. v. United
States ex rel. Hallenbeck, 311 U.S. 15, 17 (1940) (extending the liberal construction of
the Heard Act to its replacement, the Miller Act).
17
Brogan, 246 U.S. at 261-62.
18
231 U.S. 237, 243 (1913).
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stablehands who did not work at the ultimate site, but rather fed the horses who powered
the carts that carried stone to a quarry dock for shipment to the site, performed
compensable “labor.”19 Likewise a claimant who furnished the designs used by the
contractor in the molding process to make parts for a ship could be compensated for this
“labor.”20
Not all federal courts agree on how to define “labor” under the Miller Act,
but they consistently focus their inquiry on the types of tasks performed.21 Some courts
define “labor” as “physical toil.”22 Under this definition, work performed “by a
professional, such as an architect or engineer,” only qualifies as “labor” if the
professional “actually superintends the work as it is done on the job site.”23 Similarly
some courts have reasoned that clerical and administrative tasks can never qualify as
19
See Brogan, 246 U.S. at 261-62 (citing Bartlett, 231 U.S. at 243).
20
Title Guar. & Tr. Co. v. Crane Co., 219 U.S. 24, 34 (1910).
21
See, e.g., United States ex rel. Olson v. W.H. Cates Constr. Co., 972 F.2d
987, 991 (8th Cir. 1992) (“Whether [claimant] was or was not a salaried worker as
opposed to a hourly wage-earner is not controlling.”).
22
United States ex rel. Naberhaus-Burke, Inc. v. Butt & Head, Inc., 535 F.
Supp. 1155, 1160 (S.D. Ohio 1982) (“While case law interpreting the word ‘labor’ . . .
is relatively sparse, the word has been construed to include physical toil, but not work
by a professional, such as an architect or engineer.”); see also Bankers’ Sur. Co. of
Cleveland, Ohio v. Maxwell, 222 F. 797, 799 (4th Cir. 1915) (reasoning claimant
performed “labor” because his duties involved “physical exertion” and “[b]odily toil”).
23
United States ex rel. Naberhaus-Burke, Inc., 535 F. Supp. at 1160; see also
United States ex rel. Olson, 972 F.2d at 990-91 (“[T]he on-site supervisory work of a
project manager falls within the purview of the Miller Act if such a superintendent did
some physical labor at the job site or might have been called upon to do some on-site
manual work in the regular course of his job.”).
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“labor” because they are insufficiently physical.24 But not all courts have strictly
required supervisory work be performed at the job site to qualify as labor, nor have they
defined “labor” with reference to physical toil.25
The Eighth Circuit is among those federal courts that require supervisory
work to be performed at the job site in order to qualify as “labor” under the Act, limiting
the “professional supervisory work . . . covered by the Miller Act” to “skilled
professional work which involves actual superintending, supervision, or inspection at the
job site.”26 Specifically that court concluded “the on-site supervisory work of a project
manager falls within the purview of the Miller Act if such a superintendent did some
physical labor at the job site or might have been called upon to do some on-site manual
work in the regular course of his job.”27 The Fourth Circuit similarly held that a foreman
24
See United States ex rel. Constructors, Inc. v. Gulf Ins. Co., 313 F. Supp.
2d 593, 597 (E.D. Va. 2004) (“Paying invoices, reviewing proposals, and supervising
hiring are clerical or administrative tasks which, even if performed at the job site, do not
involve the physical toil or manual work necessary to bring them within the scope of the
Miller Act.”).
25
See Price v. H. L. Coble Constr. Co., 317 F.2d 312, 320 (5th Cir. 1963)
(interpreting an Alabama statute patterned on the Miller Act to encompass work such as
“selecting and securing the workmen” and “making up the payrolls and other reports”
presented to the prime contractor).
26
United States ex rel. Olson, 972 F.2d at 990 (quoting United States ex rel.
Naberhaus-Burke, Inc., 535 F. Supp. at 1160); see also Bankers’ Sur. Co. of Cleveland,
Ohio, 222 F. at 799-800 (holding claimant’s work as foreman, which included some
measure of physical toil, to be labor under the Heard Act); Nat’l. State Bank of Newark
v. Terminal Constr. Corp., 217 F.Supp. 341, 360-61 (D.N.J. 1963) (observing that
supervision constitutes labor under the Miller Act).
27
United States ex rel. Olson, 972 F.2d at 991; see also United States ex rel.
Naberhaus-Burke, Inc., 535 F. Supp. at 1160 (concluding plaintiff “can only recover on
the payment bond herein (if at all), to the extent that it performed on-site services”);
(continued...)
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whose duty was “to go among the men and actually build the building” performed labor
under the Miller Act, analogizing from the Supreme Court’s interpretation of a territorial
miner’s lien statute.28
The Fifth Circuit, instead of relying on the potential need for supervisors
to join in physical toil, emphasizes the close link between on-site supervision or
inspection and forward progress on the construction project.29 Under this reasoning, the
key inquiry is not whether the work in question physically contributes to construction,
but whether the work is “necessary to and forwards” the project.30 The Fifth Circuit
interprets the term “labor” in similar state statutes to encompass the work “of
supervisors, engineers and architects” as well as “services performed . . . in overseeing
the work, expediting it with a view to minimizing the cost, selecting and securing the
workmen, [and] making up the payrolls and other reports.”31
27
(...continued)
Nat’l. State Bank of Newark, 217 F.Supp. at 360-61 (observing that supervision
constitutes labor under the Miller Act).
28
Bankers’ Sur. Co. of Cleveland, Ohio, 222 F. at 799 (“[P]erformance [of
a mining foreman’s duties] may well be called work and labor. They require the
personal attention and supervision of the foreman, and occasionally in an emergency, or
for an example, it becomes necessary for him to assist with his own hands.” (quoting
Flagstaff Silver Mining Co. v. Cullins, 104 U.S. 176, 177-78 (1881))).
29
Am. Sur. Co. of N.Y. v. United States ex rel. Barrowagee Labs., 76 F.2d 67,
68 (5th Cir. 1935) (reasoning that by “actually superintend[ing] the work as it is done,”
a supervisor on the site “is by the weight of [his] authority furnishing labor”).
30
Id. (holding inspections and testing for compliance with applicable
regulations qualified as “labor” under the Act).
31
Price v. H. L. Coble Constr. Co., 317 F.2d 312, 320 (5th Cir. 1963)
(interpreting an Alabama statute patterned on the Miller Act); cf. Mass. Bonding & Ins.
(continued...)
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The statutory purpose of Alaska’s Little Miller Act is to “protect persons
who furnish labor or material for a state public works project from the risks of
nonpayment,” in turn “assur[ing] that material and labor will be readily furnished for [the
state’s] projects.32 The value of this labor to the state’s projects does not depend on how
physically demanding the labor is. We therefore hold “labor” under AS 36.25.020 to
include all work that is “necessary to and forwards” the project secured by the payment
bond.33 Accordingly inspections and supervisory work qualify as compensable “labor,”
in addition to physically-intensive tasks such as pouring concrete or carrying materials
to the job site.34 Whether or not these tasks are performed at the work site itself is not
determinative.35
31
(...continued)
Co. v. Steele, 293 S.W. 647, 648 (Tex. Civ. App. 1927) (interpreting “labor” in Texas’s
Little Miller Act to “include[] all bodily or intellectual exertion done for a purpose other
than the pleasure derived from the performance,” reasoning that supervisory, clerical,
and administrative work “is just as essential in the prosecution of the work as is the work
of the brickmason or carpenter”).
32
SKW/Eskimos, Inc. v. Sentry Automatic Sprinkler Co., 723 P.2d 1293, 1297
(Alaska 1986) (quoting State ex rel. White v. Neal & Sons, Inc., 489 P.2d 1016, 1020
(Alaska 1971), disapproved of on other grounds by Sea Lion Corp. v. Air Logistics of
Alaska, Inc., 787 P.2d 109 (Alaska 1990)).
33
Am. Sur. Co. of N.Y., 76 F.2d at 68.
34
See id.; Price, 317 F.2d at 320 (reading the term “labor” in statutes similar
to the Miller Act to encompass the work “of supervisors, engineers and architects”).
35
See U.S. Fidelity Co. v. Bartlett, 231 U.S. 237, 243 (1913) (concluding that
labor compensable under the Miller Act included labor at a quarry which shipped stone
to the project site).
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2. Luong performed “labor” under Alaska’s Little Miller Act at
least as late as October 9, 2015.
Luong furnished labor under Alaska’s Little Miller Act by serving as Earth
Stone’s on-site representative at the project, supervising other workers, and lending an
“extra hand” with more strenuous tasks like mixing and pouring concrete. Both parties
agree Luong performed compensable labor under the Act on October 9, 2015, when he
was one of the two workers to make the final concrete pour.36 This was physical work
performed at the job site and qualifies as “labor” under any court’s definition of the term,
including our own.
Luong claims to have performed additional labor on October 19, 2015, on
which date he claims he made field measurements at the project site. But his journal
entry providing evidence of this was not admitted into evidence. Luong further argues
that his last day as an employee for Earth Stone, on October 31, 2015, should qualify as
“labor” under Alaska’s Little Miller Act. But it is not clear from the record whether any
later work was necessary to the completion of the project.
B. The Effective Date Of “Notice” Under AS 36.25.020(b) Is The Date
Notice Is Mailed.
Alaska’s Little Miller Act requires a claimant to “giv[e] written notice to
the contractor within 90 days.”37 The Act further specifies that “notice shall be served
36
The trial judge made no findings of fact to the contrary. He noted that
Luong’s exhibits indicated his last day of work for Earth Stone on the job site was
October 9, and said if October 9 were within the 90-day notice period, he would deny
Western Surety’s motion for a directed verdict.
37
AS 36.25.020(b).
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by mailing it by registered mail . . . or in any manner in which a peace officer is
authorized to serve summons.”38
Both parties agree that Luong performed compensable labor on October 9,
2015. He presented evidence that he mailed notice of his claim by registered mail 89
days later on January 6, 2016, but Pinnacle did not receive that notice until January 11,
94 days after the last date of labor. Since the applicable statutory deadline for providing
notice is 90 days from the last date of labor, Luong’s claim is viable as long as the date
of effective notice under the Little Miller Act is the date notice is sent, not the date notice
is received.
Looking again to cases interpreting the federal Miller Act, there is no clear
consensus on when notice is effective. Western Surety argues that despite the Act’s
general purpose of protecting laborers and suppliers, the 90-day notice provision is
intended to protect prime contractors. Western Surety cites a Ninth Circuit decision,
United States ex rel. Blue Circle West, Inc. v. Tucson Mechanical Contracting Inc., as
evidence that a federal court agrees with its approach.39
The specific purpose of the 90-day notice requirement in the Miller Act, as
articulated in Blue Circle West, is “to fix a time limit after which the prime contractor
could make payment to the subcontractor with certainty that he would not thereafter be
faced by claims of those who had supplied labor and materials to the subcontractor.”40
But Blue Circle West does not exempt the notice requirement from the general rule of
38
Id.
39921 F.2d 911, 914-15 (9th Cir. 1990) (holding claimant’s letters were not
specific enough to provide notice as they failed to give any indication claimant was
looking to the prime contractor for payment).
40
Id. at 914 (quoting Bowden v. United States ex rel. Malloy, 239 F.2d 572,
577-78 (9th Cir. 1956), cert. denied, 353 U.S. 957 (1957)).
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liberal construction; it simply holds that liberal construction cannot erase the notice
requirement entirely.41
The Fourth Circuit described the notice provision’s purpose of providing
“protection to the prime contractor” as “subsidiary to the main purpose of the act to
protect those whose labor and materials enter into the prosecution of the work.”42 The
Fourth Circuit thus reasoned: “[I]f there be any ambiguity in the provisions relating to
the minor purpose, it should be resolved in support of the main object of the law,” in
order to be “in harmony with” the clearly established directive to construe the statute
liberally to effect its remedial purpose.43 However the Supreme Court has since cast
doubt on the liberal construction principle’s applicability to provisions that cut against
a statute’s general remedial purpose.44
41
Id. at 911, 916 (“[N]o rule of liberality in construction can justify reading
out of the statute the very condition which Congress laid down as prerequisite to the
cause of action.” (quoting Bowden, F.2d at 577-78)); see also Clifford F. MacEvoy Co.
v. United States ex rel. Calvin Tomkins Co., 322 U.S. 102, 107 (1944) (explaining liberal
construction of Miller Act “does not justify ignoring plain words of limitation” while
construing “subcontractor” term). But see Fleisher Eng’g &Constr. Co. v. United States
ex rel. Hallenbeck, 311 U.S. 15, 18 (1940) (“In giving the statute a reasonable
construction in order to effect its remedial purpose, we think that a distinction should be
drawn between the provision explicitly stating the condition precedent to the right to sue
and the provision as to the manner of serving notice.”).
42
Noland Co. v. Allied Contractors, Inc., 273 F.2d 917, 920-21 (4th Cir.
1959) (holding notice given within 90 days from date of delivery under last order was
timely with respect to a series of deliveries).
43
Id.
44See Encino Motorcars, LLC v. Navarro, 138 S. Ct. 1134, 1142 (2018)
(warning against narrowly construing exemptions to the Fair Labor Standards Act’s
requirements despite the Act’s generally remedial character, as the exemptions also
constitute part of the law’s purpose).
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Notwithstanding these principles of construction, the Fourth Circuit itself
has interpreted notice to be timely only when received within 90 days. In Pepper Burns
Insulation, Inc. v. Artco Corp., the Fourth Circuit interpreted the statutory condition of
“giving” notice to mean that notice must be “put in the possession of the contractor.”45
The Fourth Circuit reasoned that had Congress intended notice to be effective upon
mailing, it could have instead granted a cause of action “upon written notice” or “upon
mailing written notice.”46 And the Fourth Circuit considered the 90-day period’s
purpose best served by “provid[ing] contractors with a date certain after which they are
no longer at risk of liability to second-tier subcontractors . . . [thereby] facilitat[ing]
payments to first-tier subcontractors and closure of the project finances.”47
Western Surety cites a number of other cases to claim that the majority of
jurisdictions interpret notice under the Miller Act as effective only when received. But
many of the cases cited by Western Surety do not squarely analyze the issue.48 For
45
970 F.2d 1340, 1343 (4th Cir. 1992).
46
Id.
47Id. at 1343-44.
48
See United States ex rel. Hillsdale Rock Co. v. Cortelyou & Cole, Inc., 581
F.2d 239, 243 (9th Cir. 1978) (holding actual notice within the 90-day period to satisfy
the notice requirement even though claimant used regular rather than registered mail);
United States ex rel. Greenwald-Supon, Inc. v. Gramercy Contractors, Inc., 433 F. Supp.
156, 163 (S.D.N.Y. 1977) (stating “the Miller Act should be liberally construed, so long
as notice, however conveyed, ‘reach[es] the party sought to be held by the notice within
the statutory time for its receipt’ ” while holding notice even by unregistered mail is
sufficient as long as received within the 90-day period (quoting United States ex rel.
Gen. Elec. Co. v. H.I. Lewis Constr. Co., 375 F.2d 194, 200 (2d Cir. 1967))); United
States ex rel. Excavation Constr., Inc. v. Glenn-Stewart-Pinckney Builders & Devs. Inc.,
388 F. Supp. 289, 296 (D. Del. 1975) (holding letter neither sent nor received within 90
days after the last day of labor could not satisfy the Miller Act’s timely notice
(continued...)
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instance, in United States ex rel. General Electric Co. v. H.I. Lewis Construction Co., the
Second Circuit mentioned its “belief that [claimant’s] notice, however conveyed, must
reach the party . . . within the statutory time for its receipt.”49 But what the Second
Circuit actually held was that the 90-day notice requirement “is mandatory and is a strict
condition precedent” to a successful claim under the Miller Act, and thus that delivery
of new materials, not furnished under “the original contract[,] cannot revive a Miller Act
liability extinguished by the expired ninety-day period.”50 In fact, when the Eastern
District of New York held notice sent using registered mail within the 90-day period was
timely under the Miller Act, even if the notice was not received during that period, the
Second Circuit affirmed the decision.51
Other federal courts have assumed notice to be timely as long as it is sent
during the 90-day statutory period.52 The Eastern District of Louisiana explicitly held
that notice under the Miller Act was effective when sent, characterizing the Miller Act’s
48
(...continued)
requirement).
49
375 F.2d at 199-200 (“[O]nce ninety days have elapsed without . . . notice,
[the contractor] is free to pay the subcontractor for the latter’s work without risk of
liability under his bond to laborers . . . [of his] subcontractor.”).
50
Id. at 201.
51
United States ex rel. Lincoln Elec. Prod. Co. v. Greene Elec. Serv. of Long
Island, Inc., 252 F. Supp. 324, 328 (E.D.N.Y. 1966), aff’d, 379 F.2d 207 (2d Cir. 1967)
(upholding district court’s finding of timely notice as not clearly erroneous).
52
See Romona Equip. Rental, Inc. ex rel. U.S. v. Carolina Cas. Ins. Co., 755
F.3d 1063, 1066-67 (9th Cir. 2014) (referring to “service of the notice” and the date
written notice was “sent” under the Miller Act); Apache Powder Co. v. Ashton Co., 264
F.2d 417, 423 (9th Cir. 1959) (discussing date letter was sent by registered mail as giving
notice to prime contractor).
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notice requirement as “the general contractor’s ‘offer’ to third-tier contractors,” and the
claimant’s letter as an acceptance of that offer.53 Under this contract analogy, the parties
are subject to the standard mailbox rule where acceptance is complete when mailed.54
The Eastern District of Louisiana also noted that as a matter of statutory construction,
where “service of notice by registered mail is expressly authorized by statute, service is
effected when the notice is properly addressed, registered, and mailed.”55
Multiple state supreme courts have held notice under their states’ analog
to the Miller Act to be complete once properly sent via registered mail. The Michigan
Supreme Court recently concluded that service under the Michigan public works bond
act “is accomplished when a complainant mails the required information to the proper
destination by certified mail within the required time frame,” even if the notice is not
received during that 90-day period.56 The Maryland Court of Appeals acknowledged
that its verison of the Miller Act could reasonably be interpreted as making notice
effective when either sent or received.57 But the Maryland court was convinced that the
53
United States ex rel. Crowe v. Cont’l Cas. Co., 245 F. Supp. 871, 873 (E.D.
La. 1965).
54
Id.
55Id.; see also Grubbs v. Prince George’s Cty., 297 A.2d 754, 757 (Md. App.
1972) (adopting the same reasoning for a similarly worded statute in a personal injury
context).
56
Wyandotte Elec. Supply Co. v. Elec. Tech. Sys., Inc., 881 N.W.2d 95, 101
(Mich. 2016).
57
Montgomery Cty. Bd. of Ed. ex rel. Carrier Corp. v. Glassman Constr. Co.,
225 A.2d 448, 453 (Md. App. 1967).
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detailed description of the prescribed manner of service implied legislative intent that
“mailing of the notice tolls the statutory period.”58
The Supreme Court of the United States has never squarely addressed this
issue. But in Fleisher Engineering & Construction Co. v. United States ex rel.
Hallenbeck, the Court reasoned that, by providing for registered mail as the presumptive
method of notice, “Congress intended to provide a method which would afford sufficient
proof of service when receipt of the required written notice was not shown.”59 This
implies laborers who properly sent notice by registered mail would still have a Miller Act
claim even without proof of actual receipt. Extending that logic, if proof of actual receipt
is not required to bring a Miller Act claim, then the date of notice should not be defined
as the date of receipt.
Additionally when Fleisher was decided in 1940, the federal Miller Act’s
notice provision mirrored the equivalent provision in Alaska’s Little Miller Act.60 The
58
Id. at 454 (“Not only must postage be prepaid, but ordinary mail is not
sufficient; the notice must be sent by registered or certified mail.”).
59
311 U.S. 15, 18-19 (1940) (citing Miller Act of 1935, ch. 642, § 2(a), 49
Stat. 794 (current version at 40 U.S.C. § 3133(b)(2)) (holding, in a case where actual
notice was not contested, that the use of regular mail rather than registered mail did not
nullify an otherwise proper claim).
60
Compare Miller Act of 1935, ch. 642, § 2(a), 49 Stat. 794 (current version
at 40 U.S.C. § 3133(b)(2)) (“Such notice shall be served by mailing the same by
registered mail, postage prepaid, in an envelop[e] addressed to the contractor at any place
he maintains an office or conducts his business, or his residence, or in any manner in
which the United States marshal of the district in which the public improvement is
situated is authorized by law to serve summons.”), with AS 36.25.020 (“The notice shall
be served by mailing it by registered mail, postage prepaid, in an envelope addressed to
the contractor at any place where the contractor maintains an office or conducts business,
or the contractor’s residence, or in any manner in which a peace officer is authorized to
(continued...)
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federal Act has since been amended to read: “notice shall be served . . . by any means
that provides written, third-party verification of delivery to the contractor,” or in any
manner in which the specified official is authorized to serve summons.61 This new
version shifts the focus from actions performed by the claimant (“mailing . . . by
registered mail, postage prepaid, in an envelope addressed to the contractor”) to
confirmation of receipt by the contractor (“any means that provides written, third-party
verification of delivery”).62
But AS 36.25.020’s notice provision still concentrates on the claimant’s
actions. The statute requires the claimant to “giv[e] written notice . . . within 90 days”
and specifies exact directions claimants can follow to “serve” that notice: “mailing it by
registered mail, postage prepaid, in an envelope addressed to the contractor.”63 As long
as the claimant follows those directions, the contractor should be able to timely pay its
subcontractors, free from the risk of conflicting Miller Act claims.64
60
(...continued)
serve summons.”).
61
Act of Aug. 17, 1999, Pub. L. No. 106-49, § 2(b), 113 Stat. 231 (codified
as amended at 40 U.S.C. § 3133(b)(2)).
62
Compare Miller Act of 1935, ch. 642, § 2(a), 49 Stat. 794, with 40 U.S.C.
§ 3133(b)(2).
63
AS 36.25.020(b).
64
See United States ex rel. Crowe v. Cont’l Cas. Co., 245 F. Supp. 871, 873
(E.D. La. 1965) (holding under the 1935 version of the federal notice requirement that
the mailing date is effective, as the two methods of service specified by the statute “both
guarantee verification through an uninterested party of the date notice was dispatched,
thereby precluding factual controversies on questions relating to date of sending and date
of receipt”).
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Interpreting notice as effective upon mailing adequately preserves the 90­
day deadline’s specific purpose — to allow the prime contractor to make timely
payments to subcontractors without risking conflicting claims from the subcontractor’s
employees and suppliers. It also advances the statute’s underlying purpose — to protect
laborers and suppliers from the risk of nonpayment on public works projects.65 We
therefore hold notice under Alaska’s Little Miller Act is complete once mailed to the
contractor via registered mail.
Luong presented testimony and an exhibit indicating he served notice on
Pinnacle on January 6, 2016, within 90 days of the labor he performed on October 9,
2015.66 Luong therefore presented sufficient evidence to raise an issue of fact as to
whether he provided notice within the statutory 90-day period, and the trial court erred
by granting Western Surety a directed verdict on this issue.
65
See Noland Co. v. Allied Contractors, Inc., 273 F.2d 917, 920-21 (4th Cir.
1959) (“[I]f there be any ambiguity in the provisions relating to the minor purpose, it
should be resolved in support of the main object of the law.”).
66
The district court did not seem to consider the date the letter was sent to be
relevant to its inquiry under the Little Miller Act, and so did not evaluate the sufficiency
of the evidence on this point. Luong’s testimony indicates the letter was sent January 6,
the letter from Luong’s then-attorney was dated January 6, and Western Surety has
presented no evidence contradicting that date. Furthermore the letter traveled all the way
from California to Alaska, and arrived by January 11; this date of receipt “is entirely
compatible with the letter having been sent on the date it bears.” Montgomery Cty. Bd.
of Ed. ex rel. Carrier Corp. v. Glassman Constr. Co., 225 A.2d 448, 453 (Md. App.
1967) (holding sufficient proof that claimant’s letter “was mailed within the 90 day
period” to survive motion to dismiss).
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V. CONCLUSION
We REVERSE the superior court’s denial of Luong’s appeal, VACATE the
judgment against Luong and the award of attorney’s fees,67 and REMAND for further
proceedings.
67
Western Surety must return any funds it has already garnished from Luong.
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