Florida Oil Investment Group, LLC v. Goodwin & Goodwin, Inc.
2015 Ark. App. LEXIS 271
| Ark. Ct. App. | 2015Background
- Goodwin & Goodwin foreclosed a materialmen’s lien on Fort Chaffee site owned by FCRA; judgment for $40,125.
- Appellee claimed labor and materials were provided to Fort Smith Petro Environmental, LLC (FSP) under an oral contract; Goodwin believed FSP owned or controlled the site.
- Property ownership was actually with FCRA; Petro Gold Environmental, LLC leased the site; tension arises from complex corporate relationships (SHEM, Northcutt, Anglin, Sanon).
- Circuit court found a Real Estate Contract (Commercial Property) between FCRA and FSP effective November 28, 2011, but work ended November 18, 2011 and no evidence showed FSP ownership at time of lien attachment.
- Evidence showed no valid contract between the lien claimant and the actual owner or owner’s agent at the time work was performed; lien statute requires such a contract.
- Court held 18-44-101 requires contract with owner/contractor/agent; since none existed, the lien was invalid, and attorney’s fees awarded under 18-44-128 were reversed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the lien was valid under 18-44-101 | Goodwin contends it had a contract with the owner/agent (FSP via Northcutt). | Florida Oil asserts no contract with owner or agent at the time work occurred; FCRA owned the property. | Lien invalid; no contract with owner/agent at time of work. |
| Whether FSP acted as owner/agent to support the lien | Northcutt represented FSP as owner/agent; contract implied. | There was no evidence of a contract between FSP and FCRA or ownership by FSP. | Insufficient contract/agency; lien invalid. |
| Whether overhead and profits may be included in the lien | Invoices included 7% overhead and 10% profit. | Overhead and profits are improper under the statute for this lien. | Overhead and profits improper; moot since lien invalid. |
| Whether attorney’s fees were recoverable | Fees are recoverable under 18-44-128 for successful liens. | No successful enforcement due to invalid lien. | Reversed; fees not awarded. |
| Whether joinder or service issues affect the lien | Service and notice were attempted; defects asserted. | Defects fatal to lien; required parties not properly joined. | Not decisive beyond invalid lien; lien void for other reasons. |
Key Cases Cited
- Sebastian Bldg. & Loan Ass'n v. Minten, 181 Ark. 700 (1930) (possession not enough for lien; must have contract with owner/agent)
- Katterjohn Concrete Products, Inc. v. Coffman, 264 Ark. 503 (1978) (materialman’s lien requires contract with owner or authorized agent)
- Seyller v. Pierce & Co., 306 Ark. 474 (1991) (lien cannot attach through uncontracted property interests)
- Books-A-Million, Inc. v. Ark. Painting & Specialties Co., 340 Ark. 467 (2000) (strict construction of lien statutes)
- Hickman v. Kralicek Realty & Constr. Co., 84 Ark. App. 61 (2003) (de novo review of lien-foreclosure rulings)