VCS, Inc. v. La Salle Development, LLC
2012 UT 89
| Utah | 2012Background
- VCS, Inc. worked as general contractor on Northpark Meadows subdivision in Ogden, Utah starting November 2006.
- Utah Community Bank (UCB) held a subordinate interest via a construction loan secured by a deed of trust dated January 9, 2007 and recorded January 12, 2007.
- VCS filed a Notice of Commencement (April 17, 2007) and a Notice of Mechanic's Lien (January 29, 2008); lis pendens were not recorded until April 24, 2009.
- La Salle Development was the subdivision owner; VCS sued La Salle in 2008 and then amended to include UCB claims in 2009; a district court set aside a prior default judgment against La Salle in 2009.
- In December 2009, UCB acquired several Northpark Meadows lots via trustee’s sale on its deed of trust.
- District court granted summary judgment for UCB, holding VCS’s lien void for failure to timely record lis pendens and denying unjust enrichment relief; VCS appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether lis pendens must be timely recorded within 180 days | VCS argues exceptions allow later joinder/knowledge to save lien. | UCB contends 180-day lis pendens requirement is strict; exceptions remain within 180 days. | Lis pendens must be timely recorded within 180 days; exceptions do not suspend the deadline. |
| Relation back or Butterfield-type relief to validate against UCB | VCS argues amended pleadings relate back or Butterfield allows lien against later purchaser. | UCB argues no identity of interest and Butterfield does not apply to attach lien to proceeds/third-party purchaser. | Relation back not permitted; Butterfield does not support VCS’s position; no constructive party/notice doctrine applied. |
| Substantial compliance with lis pendens requirement | VCS contends substantial compliance should excuse untimely lis pendens. | UCB argues lis pendens is express, important notice; noncompliance prejudicial, not harmless. | Lis pendens noncompliance is not substantial; defect is not harmless and lien is void. |
| Equitable relief of unjust enrichment after statutory remedies | VCS seeks unjust enrichment due to UCB’s alleged enrichment from VCS’s work. | UCB asserts exhaustion requirement and that statutory remedies foreclose unjust enrichment. | Unjust enrichment denied for failure to exhaust legal remedies; we affirm and remand for attorney fees. |
Key Cases Cited
- Butterfield Lumber, Inc. v. Peterson Mortgage Corp., 815 P.2d 1330 (Utah Ct.App.1991) (lien attaches to proceeds; lack of timely lis pendens void against purchasers)
- Perry v. Pioneer Wholesale Supply Co., 681 P.2d 214 (Utah 1984) (identity of interest concept limits relation back)
- Projects Unlimited, Inc. v. Copper State Thrift & Loan Co., 798 P.2d 738 (Utah 1990) (strict view of substantial compliance; not all minor defects are harmless)
- Eccles Lumber Co. v. Martin, 87 P.713 (Utah 1906) (express command rules must be followed; material vs harmless noncompliance)
- Knight v. Post, 748 P.2d 1097 (Utah Ct.App.1988) (unjust enrichment requires no adequate legal remedy)
- American Towers Owners Ass'n, Inc. v. CCI Mech., Inc., 930 P.2d 1182 (Utah 1996) (doctrine of unjust enrichment limited when legal remedies exist)