Mata Hardscape Designs v. Georgetown West Townhouse Owners Assoc.

 Based on alleged increased costs associated with work delays,
Mata tendered a 15-day notice of intent to lien to Georgetown, indicating
an outstanding balance of $20,197.02. 1 Georgetown has never disputed
that it owed the $16,197.02 balance due under the contract. Mata
recorded a notice of intent to lien, again in the amount of $20,197.02,
naming Georgetown as the owner of the property. Subsequently, Mata
recorded a notice of lien in the amount of $20,197.02; however, this notice
of lien named 150 individual homeowners as the owners of the property.
Mata recorded an amended notice of lien and a second amended notice of
lien in the amount of $93,724.64, indicating that each homeowner was
responsible for $624.83 of this amount.
In response to the second amended notice of lien, Georgetown
filed a complaint in district court, along with a motion for an order to show
cause why a reduction or a release of the mechanic's lien should not issue.
Georgetown argued that NRS 108.245 required Mata to provide a notice of
right to lien to the individual homeowners upon entering into the contract.
Alternatively, Georgetown cited NRS 108.2275 and argued that even if the
lien was procedurally valid, it was excessive due to Mata's inclusion of the
$77,527.62 that was not supported, authorized, and approved by a
properly executed change order.
In opposition, Mata argued both the merits of its lien and that
Georgetown invoked NRS 108.2275 incorrectly. Specifically, Mata argued
that (1) Georgetown should not have obtained a hearing date for its
motion, but rather should have first sought an order to show cause via an
1 It
appears that this dollar amount was derived from the contractual
amount owed, plus $4,000 for root damage repairs.
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ex parte motion; (2) Mata was not required to serve a notice of right to lien
to the individual homeowners because it "contracted directly with the
owner of the property" since each homeowner is a member of Georgetown
and Georgetown acts on behalf of the individual owners; and (3) its lien
was not excessive, as evidenced by payroll records and rental cost
documents that were attached to the opposition.
After a hearing, the district court granted Georgetown's
motion, expunging the lien. The district court found that the common
area was owned by the individual homeowners, and that Georgetown had
not executed any change orders for the additional $77,527.62 claimed by
Mata. As a result, it ruled that the lien was invalid because NRS 108.245
required Mata to provide the individual homeowners—the owners of the
common area—with a notice of right to lien, and the lien was excessive as
the contract provided for a specific amount. Mata now appeals.
The district court did not violate NRS 108.2275 or Mata's due process
rights by ruling on the validity of the mechanic's lien at the initial hearing
On appeal, Mata argues that the district court erred in
expunging its lien at the initial hearing requesting an order to show cause,
in violation of NRS 108.2275 and in violation of its due process rights.
Mata argues that it only filed a "limited" opposition that "was mainly
based on procedural issues. . . not a substantive opposition to the claims
against the mechanic's lien itself." Thus, Mata argues that without the
show cause hearing, it "was not given the opportunity to present evidence
in the form of affidavits or testimony, and was allowed very little legal
argument." We do not agree.
The parties disagree regarding how this court's prior decision
in J.D. Construction, Inc. v. IBEX International Group, LLC, 126 Nev. ,
240 P.3d 1033 (2010), influences this case. In J.D. Construction, this court
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concluded that due process does not require a district court "to hold a full
evidentiary hearing, but instead [the district court] may base its decision
on affidavits and documentary evidence submitted by the parties." 126
Nev. at , 240 P.3d at 1036. This court held that a summary proceeding
did not violate the lien claimant's due process rights because (1) the risk of
an erroneous deprivation was low, and (2) both parties were afforded
sufficient opportunity to present their case through affidavits and
supporting documents. Id. at , 240 P.3d at 1041 (analyzing the three
due process factors enumerated in Mathews v. Eldridge, 424 U.S. 319, 335
(1976)). Thus, while J.D. Construction provides some guidance regarding
the procedural due process analysis under NRS 108.2275, it merely
addresses whether factual disputes must be reserved for trial, not whether
a district court may rule on a motion to expunge a lien at the initial
hearing.
Based on our review of the record, we conclude that Mata was
afforded adequate due process. While Mata did not receive a second
hearing and the limited discovery afforded the lien claimant in J.D.
Construction, "[d]ue process, unlike some legal rules, is not a technical
conception with a fixed content unrelated to time, place and
circumstances." Mathews, 424 U.S. at 334 (alteration in original) (internal
quotations omitted). Rather, it "is flexible and calls for such procedural
protections as the particular situation demands." Id. (internal quotations
omitted).
Here, the primary issues before the district court were issues
of law, which did not require extensive discovery to resolve. Additionally,
Mata argued the merits of its lien in its opposition to Georgetown's motion
and submitted documentary evidence in support of its lien. We are
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therefore not persuaded by its argument that it was not given the
opportunity to present evidence to the district court. Thus, given the
primarily legal issues before the court and the fact that Mata's opposition
was filed with documentary evidence attached, we conclude that Mata was
given "the opportunity to be heard at a meaningful time and in a
meaningful manner." Mathews, 424 U.S. at 333 (internal quotations
omitted). Therefore, the district court did not err in expunging the motion
at the initial hearing.
The district court erred in ruling that the individual owners were entitled
to service of a notice of right to lien under NRS 108.245 because Maki
contracted with their agent
Mata argues that it was not required to serve a notice of right
to lien on the individual owners because it contracted with them through
Georgetown, their agent. See Hardy Companies, Inc. v. SNMARK, LLC,
126 Nev. „ 245 P.3d 1149, 1157 (2010) ("Actual knowledge by the
property owner's agent is imputed to the property owner."). Mata argues
that Georgetown controlled the project as the agent for the individual
owners pursuant to the CC&Rs. Thus, Mata argues that its service of pre-
lien notice on the homeowners' agent renders pre-lien notice on the
homeowners themselves unnecessary. We agree.
Under NRS 108.245(5), a contractor who contracts directly
with an owner is not required to give pre-lien notice. Thus, pre-lien notice
is only required when a potential lien claimant contracts with a third
party, rather than the owner. See Hardy, 126 Nev. at 245 P.3d at
1157; cf. NRS 108.245(5). However, this court has concluded that a lien
claimant is not required to provide pre-lien notice when the owner has
actual knowledge of the potential lien claims via regular progress updates
from an agent who inspected the premises. Hardy, 126 Nev. at 245
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P.3d at 1157. In that situation, this court determined that "[d]elivery of
any pre-lien notice would. . . accomplish[ ] little or nothing and, therefore,
[is] not required." Id. (internal quotations omitted).
Here, the record shows that Georgetown regularly
communicated with Mata regarding the progress of the project and
payments made. Thus, this situation is similar to Hardy in that the
owners' agent contracted with the lien claimant and kept abreast of
construction progress on behalf of the owners. We therefore conclude that
the district court erred in finding that the mechanic's lien was invalid
based on a lack of pre-lien notice. See Hardy, 126 Nev. at , 245 P.3d at
1157 ("An owner who witnesses the construction, either firsthand or
through an agent, cannot later claim a lack of knowledge regarding future
lien claims."). However, as discussed below, the district court properly
found the lien to be excessive.
The district court did not err in finding that the lien was excessive because
the contract provided for the total payment amount and Mata failed to
provide change orders or other evidence supporting its unilateral
$77,527.62 increase in price
In analyzing evidence presented regarding the validity of a
mechanic's lien, "the district court must apply a preponderance-of-the-
evidence standard to determine whether a lien is excessive." J.D. Constr.,
126 Nev. at 240 P.3d at 1043. "This court will not disturb the district
court's factual determinations if substantial evidence supports those
determinations." Id. at , 240 P.3d at 1043. "Substantial evidence is
that [evidence] which a reasonable mind might accept as adequate to
support a conclusion." Id. at , 240 P.3d at 1043 (alteration in original)
(internal quotations omitted). "Therefore, this court will only set aside
findings that are clearly erroneous." Id. at 240 P.3d at 1043.
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Georgetown argues that NRS 108.222(1)(a) controls in
situations where the parties have entered into a contract stating a specific
price or a method of determining a specific price.' Georgetown argues that
Math, in instituting its $93,724.64 lien, ignored the statutory cap on the
legally lienable amount, which is "the unpaid balance of the price agreed
upon" by contract, or the $16,197.02 Georgetown admits it owes. NRS
108.222(1)(a). Thus, Georgetown argues that even if Mata were entitled to
a lien against the homeowners' property, the district court correctly ruled
that the $77,527.62 was excessive because the allowable lien amount is set
by the contract and by statute at the remaining balance of the agreed-
upon price: $16,197.02. We agree.
2 NRS 108.222 states:
1. Except as otherwise provided in
subsection 2, a lien claimant has a lien upon the
property, any improvements for which the work,
materials and equipment were furnished or to be
furnished, and any construction disbursement
account established pursuant to NRS 108.2403,
for:
(a) If the parties agreed, by contract or
otherwise, upon a specific price or method for
determining a specific price for some or all of the
work, material and equipment furnished or to be
furnished by or through the lien claimant, the
unpaid balance of the price agreed upon for such
work, material or equipment, as the case may be,
whether performed, furnished or to be performed
or furnished at the instance of the owner or the
owner's agent . . . .
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The contract between the parties provided for the amount to
be paid, and required any change orders to be agreed to in writing. Mata
has not provided any evidence in district court or on appeal indicating it
was legally entitled to any amount over $16,197.02. Therefore, we
conclude that the district court did not err in finding that Mata's lien was
excessive in the amount of $77,527.62.
Accordingly, we ORDER the judgment of the district court
AFFIRMED IN PART AND REVERSED IN PART AND REMAND this
matter to the district court for further proceedings consistent with this
order.
Hardesty
cc: Hon. Douglas W. Herndon, District Judge
Pezzillo Lloyd
Flangas McMillan Law Group, Inc.
Leo P. Flangas
Eighth District Court Clerk
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