273 P.3d 1
N.M. Ct. App.2012Background
- Liberty, as surety on a City of Rio Rancho project payment bond, faced Neumark’s Little Miller Act lien on unpaid irrigation materials.
- Neumark supplied irrigation materials to the subcontractor for the project and issued 18% open-account interest on the credit arrangements.
- Neumark’s invoices identified delivery dates and related to project materials; Neumark believed materials were being supplied for the contract prosecution.
- The district court found Neumark supplied materials for the project and was owed sums for those materials, with 18% prejudgment interest being justified.
- The court also awarded Neumark post-judgment interest at 18% and denied attorney fees on the ground that Neumark and Liberty’s contractor were not party to the credit agreements.
- Liberty appeals arguing lack of proof of delivery and incorporation, procedural notice failures, improper prejudgment interest, and lack of attorney-fee recovery; Neumark cross-appeals on attorney fees and post-judgment interest.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Delivery or incorporation required? | Solsbury Hill. | Liberty. | No; delivery and incorporation not required. |
| Notice of claim substantial compliance? | Neumark substantially complied. | Liberty. | Substantial compliance accepted. |
| Notice to obligee proper timing? | Not prejudicial; notice timely. | Liberty. | Not jurisdictional; no reversible error. |
| Prejudgment interest recoverable? | Interest 18% justified as sums due. | Privity and statute limit interest. | Prejudgment interest award affirmed as sums due. |
| Attorney fees and post-judgment interest? | Contract provides for fees; post-judgment interest appropriate. | No fee recovery absent contract or statute. | Attorney fees awarded; post-judgment interest at contract rate approved. |
Key Cases Cited
- Crane O'Fallon Co. v. Via, 56 N.M. 772, 251 P.2d 260 (1952) (notice requirement analysis in Miller Act context)
- Goodmans Office Furnishings, 102 N.M. 22, 690 P.2d 1016 (1984) (liberal construction; supply not necessarily used is not determinative)
- Krupp Steel Prods. v. Aetna Ins. Co., 831 F.2d 978 (11th Cir. 1987) (delivery or use not required; good faith may suffice)
- Moody v. American Ins. Co., 835 F.2d 745 (10th Cir. 1987) (notice sufficiency; liberal Miller Act interpretation)
- D & L Constr. Co. v. Triangle Elec. Supply Co., 332 F.2d 1009 (8th Cir. 1964) (contractual terms govern interest; sums justly due)
- United States ex rel. Krupp v. Endebrock-White Co., 275 F.2d 57 (4th Cir. 1960) (delivery/use not required for Miller Act recovery)
- Maddux Supply Co. v. St. Paul Fire & Marine Ins. Co., 86 F.3d 332 (4th Cir. 1996) (Miller Act interest/attorney-fee recognition; liberal construction)
- United States ex rel. Se. Mun. Supply Co. v. Nat'l Union Fire Ins. Co. of Pittsburgh, 876 F.2d 92 (11th Cir. 1989) (attorney fees awarded where contract provides for them)
- C.J.C., Inc. v. West States Mechanical Contractors, Inc., 834 F.2d 1533 (10th Cir. 1987) (attorney-fees in Miller Act action depend on contract or exceptions)
- Nichols v. Safeco Ins. Co. of Am., 100 N.M. 440, 671 P.2d 1151 (Ct. App. 1983) (Miller Act-like recovery; privity not sole gatekeeper)