*1 179 v Const Lien Fund Brown 1993] HEATING, v HOMEOWNER PLUMBING & INC BROWN FUND CONSTRUCTIONLIEN RECOVERY 5). (Calendar 8, Argued 1992 No. De- Docket No. 92347. December May cided 1993. subcontractor, Inc., Plumbing, Heating & a licensed against brought in the Montcalm Circuit Court an action others, Recovery Lien Fund and seek- Homeowner Construction by ing Leonard an amount owed it E. Cruz Ortiz and collect Ortiz, Homes, Energy general doing Primus its business as contractor, misrepresented possession of a valid build- who had J., court, Banks, granted summary The James L. er’s license. holding plaintiff disposition plaintiff, that because the substantially complied licensing requirements of with the 203(3)(h) Act, person seeking Lien that a of the Construction § recovery or subcon- from the fund establish that the contractor the fund claimant contracted is licensed as tractor with whom law, recovery required by from the fund. The it was entitled Hood, P.J., Appeals, Fitzgerald, and McDonald Court of JJ., curiam, opinion per finding in an that because the affirmed nature, liberally interpreted it should act is remedial claimants, compliance and that favor lien substantial (Docket permit recovery from the fund is sufficient to § 127345). appeals. No. The defendant opinion joined by Levin, Brickley, In an Justice Justices Supreme Boyle, Riley, Griffin, Court held: Act, requires 302 of the Lien Section Construction compliance perfect liens and to substantial construction acquire part permit jurisdiction, apply not a court to does collect from which enumerates Recovery Fund. the Homeowner Construction unambiguous expressly provides 1. The act is clear and perfec- compliance applies only to the in 302 that substantial § liens addressed in 1 and court tion way suggests jurisdiction. It in no that substantial referring By to the to collect from the fund. not is sufficient expressly limits its fund or application part 1. placement 2. of 302 in 3 does not evidence rather, act; legislative intent to the entire [May- Mich expressed placement merely ambiguous. actual as intent unambiguous language precedence takes over of 302 Likewise, placement. parts essentially the fact that and 3 are lien identical to the former mechanics’ act and *2 at of the current act confirms that added the time enactment applies only parts 302 1 and 3. § 3. of the first sen- While the liberal construction act, applies it cannot and should not tence the entire § §203(3)(h) requirement nullify unambiguous the clear fund, that, seeking it from the must be established the contractor licensed. validity 4. 2 does deal with the of construc- Because not liens, provisions tion tested a its cannot be substantial compliance standard. Reversed. Cavanagh, joined by Justice Justice Chief dissent-
ing, statutory the rules of stated that on basis of the construc- Act, it tion and the remedial nature of the Construction Lien substantially comply sufficient for a lien claimant' with 203(3)(h)in order to recover from the Homeowner Construc- § Recovery tion Lien Fund. only protect Lien intended to not Construction Act was a materials, wages right payment lien claimant’s for or but multiple payments same also a land owner from for the ser- 203(3)(h)provides that in lien claim- vices. Section order for a ant to from the the contractor must be licensed. recover provides compliance with Section 302 that substantial permit recovery the act is from sufficient Recovery placement Homeowner Construction Lien Fund. The deliberate, of 302 in 3 of act was a affirmative evidencing Legislature, its that § decision intention including Reading applicable throughout act 2. entirety, Act in that § Construction Lien is clear applicable should be made collection 203(3)(h). fund, including (1991) App reversed. Mich NW2d Richard D. Palmer for the plaintiff. Kelley, L.
Frank J. Thomas General, Attorney Casey, A. and Michael Lock- General, Solicitor man, General, for the defen- Attorney Assistant dant. Plumbing
1993] Brown Lien Fund v Const Opinion of the Court granted leave to determine J. We Brickley, provision, compliance” the "substantial whether Act, MCL 570.1101 Lien of the Construction 26.316(101) applies seq., seq.; §to et et requires who seeks that one of the recovery Construction the Homeowner person Recovery with Fund establish if re- is licensed contracted the claimant whom quired to be licensed.
i dispute. On not of this case are The facts plaintiff April 14, 1987, plumbing properly Heating, Inc., licensed heating contract contractor, entered a written general Energy Homes, contractor Primus building provide homes, in plumbing business of on a residential and materials labor *3 fraudulently job. informed Primus construction plaintiff provided license a that it was licensed belonging unrelated, licensed, to a but number construction Mayflower
company, Construction.1 the license or an asked to see Plaintiff never card. identification and failed to Primus became insolvent
When completed, pay the work for the subcontractors proceed- filed and foreclosure of lien were claims begun property. ings The Homeowner on the were Recovery named as a Fund was Construction 26.316(203X4). 570.1203(4); party. The MSA MCL they stating that filed an affidavit homeowners Primus, misrepresented Ortiz, to the homeown- co-owner of Cruz a number license and used the license had a builder’s ers that he building permits for belonging Mayflower Construction obtain co-owner, Ortiz, statements filed sworn job. the other Leonard general bank, Mayflower alleging contractor. was misrepresented themselves to Additionally, Cruz and Leonard Ortiz Mayflower Energy in association with Homes as "Primus others Construction, . . . .” License Builder’s # [May- Opinion op the Court thereby completed, for the work Primus paid 570.1203(l)(a); liability. MCL themselves of relieved 26.316(203)(l)(a). MSA through payment to seek then resorted
Plaintiff
seq.;
MCL 570.1201 et
MSA
Fund.
Recovery
26.316(201)
plain
seq.
et
pay
The fund refused to
compli
failure
show
plaintiff’s
tiff because
recovery
under
prerequisites
ance with
a licensed residen
that Primus was
namely,
Michigan law.2
required
as
under
contractor
tial
filed motions for
and the fund
plaintiff
Both the
granted the
The trial court
disposition.
summary
motion,
had
holding
plaintiff
plaintiff’s
and, therefore,
the act
complied with
substantially
from the fund.
entitled to recover
Noting that one of the dual
appealed.3
fund
The
protect
Act is to
Construction Lien
purposes
or
perform
provide
labor
rights
of those who
property,
of real
improvement
for the
materials
stated
Appeals
affirmed.
Court
the Court
nature,
is remedial
the act
that because
required
they may
to be licensed before
2Kesidential builders are
18.425(601X1);
339.601(1);
provide
MCL
services. MCL
18.425(2401)(a).
339.2401(a);MSA
specific prerequisites
the fund are found in
to recover from
203(3),
provides
part:
Subject
person
who has recorded a claim
to section
recovering
precluded
a construction lien
from
lien and who
(1) may
fund
amount for
recover from the
under subsection
which
the fund shall establish all of the
person
A
the lien is established.
who seeks
following:
(h)
subcontractor, with whom the
That the contractor or the
with,
person claiming
contracted
is li-
the construction lien
570.203(3)(h);
required by
if
law to be licensed. [MCL
censed
*4
26.316(203)(3)(h).]
preserve
there
did not
the issue whether
We note the defendant
compliance with the
for reimbursement
was substantial
general
spite
fact that
the
from the lien
contractor
address this issue.
203(3)(h).Thus,
required by
we do not
not licensed as
Fund
v Const Lien
1993]
op
Opinion
the Court
lien
in favor of
interpreted
liberally
should be
result,
the court held that substan-
As a
claimants.
is sufficient
compliance
tial
with §
709,
App
the fund. 190 Mich
permit
recovery from
(1991).
granted
We
leave
476 NW2d
(1992), and
now reverse.
ii of provides: the act Section statute, and a remedial This act is declared the liberally to secure beneficial shall be results, intents, construed of Substan- purposes and this act. act provisions of this compliance with the tial validity of the construc- be sufficient for shall give provided for in this and tion liens [Empha- to the to enforce them. jurisdiction court sis added.] unambiguo clear provision find this to be
We
provides that substan
express language
us.4
1)
applicable
aspects:
is
in two
compliance
only
tial
provided
liens
the construction
perfection
2)
give
jurisdiction.
for in
court
states
Although the first sentence
the section
act
liberally,
the entire
is to be construed
that
qualified
sentence
second
language
above
only
two
described
instances
compli
that
way suggests
in no
substantial
from the fund.
ance is sufficient
to collect
pro-
Legislature
persuasive
findWe
intention
demonstrating
express language
vided
should
language
substantial
act
act.
1 of the
1 of the
Part
apply only
points
legislative
derived from
out that
intent must be
The dissent
statute,
language
is clear and
and when
the actual
unambiguous,
necessary.
interpretation
Post at 188.
no further
368, 376;
[1988].)
Inc,
Storey Meijer,
(Citing
Mich
429 NW2d
v
*5
184 Opinion the Court of acquire procedures enforce- an the establishes able piece particular of on a construction lien part property; words, 1 the in establishes other acquire procedures lien.” a "valid Lien 2 the Homeowner Construction Part Recovery creates the Fund and enumerates fund. to collect from the must be established that recovery referring Therefore, the fund or not validity referencing only "the from the language liens,” of the actual the construction of application part expressly 1. limits its 302 placement plaintiff argues §of 302 that the Legislature intended in 3 is evidence that the possi It also that 302 to the entire act. Legislature, of the with the addition the ble repositioning recovery of the sections fund and the up previous act, consider did not that made the Legis application § 302.5 the of Where current may placed § more a matter 302 have been lature example, arranging utility. the various For of provisions particularly, case, statute, in this of a as greater provisions part of a former become where put statutory scheme, it is reasonable sub beginning place in the of the statute stance interpretive at the end. appeared part it § If 302 would would have argument pale beyond to which applies. § found in The fact that is not unambiguous language. We should not defeat question case, it is a think that in this where language language where the the actual versus paramount. appears, actual parts 1 and of the The dissent indicates substantially from the former mechan- act borrow "[virtually fact, In all of the sections lien act. ics’ predecessor, part of this statute’s fund was not the current act was a new mechanics’ lien act. Part former in 1982. the enactment of this statute addition with Lien Fund Const v 1993] Brown Opinion Court con are now lien act former mechanics’ parts 3 of the Construction 1 and within tained new creation 190. 2 was a at Part Act.” Post dissent statute. The of this the enactment original quotes the current version of at 193. 1897. Post lien act of mechanics’ essentially has remained that section The fact that *6 century that demonstrates same for almost the parts changed. meaning 1 and Because not has act, it lien former mechanics’ 3 are taken parts. applies § to those that is obvious part applies 2, question § to is whether recovering specific criteria for enumerates equal argued with think it can be the fund. We apply Legislature to had intended that if the force part newly 2, have it would created § 302 to the nearly language has existed for that the amended expressly provide years new for its hundred one application.6 Legislature not the did The fact that meaning language confirms that its amend application changed, and, therefore, § 302 not have parts only applies 1 and 3. that the substantial conclusion
Because of our provision § 302 does not of question part whether 2, the now becomes Appeals on can be based the Court of decision acknowledge §of 302. While we the first sentence language the first that the liberal applies nonetheless the entire we sentence nullify liberality not cannot and should that find unambiguous requirement._ clear and states: The dissent only apply to the Legislature intended §302 If the perfecting under then procedures lien a construction provided placed the act or 302 in have it would language expressly application limiting 302 to 1. of § at 191.] [Post Dissenting Opinion 203(3)(h): the actual We take notice of from the fund shall person A who seeks following: . . . That the con- establish all of subcontractor, per- with whom the or the tractor son is licensed with, contracted claiming the construction lien required by licensed. if law to be [Em- phasis added.] provision construe this liberally cannot
One without particular plaintiff this relief provide There is meaning of the statute. destroying general to indicate that nothing the record during at time any contractor was licensed provision relationship parties. between the steps claimant shall take does not say that, if, he believe subjectively determine or that Therefore, we hold party the other is licensed.7 does not that a liberal construction plaintiff’s claim. save
iii *7 conclusion, 2 of the act does not In because liens, its of construction validity deal with a com- cannot be tested substantial provisions we reverse the deci- pliance Accordingly, standard. Appeals. sion of Court JJ., concurred Levin, Riley, Griffin, Boyle, J. Brickley, majority opin- J. dissent from the Mallett, We themselves to a liberal con- Some of the act do lend struction, degree. particularly question of The where there a .is 203(l)(c) provide example: (cooperating following in the an sections 203(3)(a) (entitled lien), fund), to a construction defense of the (not 203(3)(e) fund), colluding payment obtain from the to § §203(3)(g) (making payment to obtain a reasonable effort subcontractor). or contractor 1993] Lien Fund Const v Dissenting Opinion Court of the decision affirm ion and would majority Appeals. the substantial holds applies only to §302 perfecting lien under a construction for details part against claims and not to the act complete result, adherence 2. As a fund under 203(3) a condi- §in set forth to the precedent the fund. We to tion disagree.
i Act 1980, the Construction Enacted purpose. protective It a dual to achieve seeks aspires right only protect lien claimant’s not to wages payment materials, also or but for to multiple payments the same for landowner from Churchfield, 180 Fischer-Flack, Inc v services. Mich (1989). pream App 606; 447 NW2d pur broadly defined forth its to the act sets ble pose. establish, by lien protect, and enforce An act providing performing labor or rights persons improvement of real equipment for material or property; spect tion lien with re- provide for certain defenses construc- thereto; a homeowner to establish department of recovery fund within powers for the regulation; provide licensing and oflicers; for provide state duties of certain and the assessments pre- occupations; of certain acts and repeal certain penalties; and
scribe parts of acts.
Although preamble au- considered is not construing thority inter- act, it is useful for an scope. purpose preting v East Malcolm (1991); Detroit, NW2d (5th *8 Statutory Singer, Construction 2A Sutherland ed), pp 47.04, 145-150.
188 179 442 Mich Opinion Dissenting A statutory construction rules of fundamental determining applicability of are instructive held occasions, Court has this § 302. several On clear of a statute are that where applied (After Remand), they unambiguous, writ- as are be Corp Gilroy Motors v General ten. (1991); v 271 Selk 341; 475 NW2d
438 Mich 1, 9; 345 Products, 419 Mich NW2d Detroit Plastic (1984). provisions, construing statutory 184 When and effectuate is to discover the court’s task legislative Legislature. intent intent language of a stat- from the actual to ute, derived unambig- is clear and when necessary. interpretation uous, further no Storey Meijer, 429 169 Inc, 431 Mich NW2d v (1988). give ambiguity exists, must a court Where construction reasonable a valid and the statute give any inconsistencies reconcile that will Wagenmaker, parts. 437 Girard v to all of its effect (1991); Aikens v 231, 238; 470 NW2d Mich Dep’t 495, 499; Conservation, 387 Mich (1972). "the A must also ascertain court NW2d designed remedy, it is mischief which evil or construction a reasonable and will purpose.” accomplishes Pittsfield the statute’s best App Twp 99, 105; Saline, 103 Mich v Charter (1981). are to be Remedial statutes NW2d persons liberally in- in favor of the construed Bierbusse v the statute. to be benefitted tended App Group, 34, 37; Ins Farmers (1978). NW2d statutory precepts these
With Act, a lien mind, under the Construction plaintiff must as such claimant recovering from before several elements establish *9 Lien Fund v Const 1993] Dissenting Opinion Mallett, J. Among fund.1
defendant 203(3)(h),2 provides: which 204,[3] has re person who Subject to section precluded from who is of lien and corded a claim (1) subsection lien under recovering a construction the amount the fund recover from may recov person A who seeks lien is established. of the follow establish all the fund shall ery from ing: subcontractor, (h) with or That the contractor lien claiming the construction person whom with, required by law to if is licensed contracted licensed.[4]
be provides a self-contained act 302 of the Section directive. statute, and a remedial declared to be This act is to secure beneficial liberally construed shall be results, intents, act. Substan- purposes of this of this act compliance with tial validity of the construc- for the sufficient shall be act, give and to in this provided for tion liens [Empha- them. to enforce to the court jurisdiction sis added.]_ MCL Section See MCL 570.1203(3)(h); MSA 570.1203(3); MCL 570.1204; MSA MSA 26.316(203)(3)(h). 26.316(203X3). 26.316(204), provides: pay to subcontrac- department out of the fund shall not $75,000.00 per
tors, residen- suppliers, more than and laborers appears claimed from the amount tial structure. When the structure, respect will exceed to a residential delay payment $75,000.00, may until the total department If the total amount paid ascertained. can be amount subcontractors, suppliers, laborers exceeds payable $75,000.00, proportional of that they paid shares their shall be amount. 339.2401; 18.425(601), 339.601; MSA MCL MSA See MCL 18.425(2403). 339.2403; 18.425(2401), and MCL Dissenting Opinion Mallett, the substantial to ascertain whether We are asked applies §to § 302 .5 the act B separated into Lien Act The Construction parts.6 act borrow 1 and 3 of the three Parts substantially lien act.7 the former mechanics’ repeal following lien mechanics’ fact, In "disposition Legislature provided table” *10 corresponding in the sections indicates Virtually all of the sections Lien Act. Construction of now con lien act8 are the former mechanics’ parts 1 3 of the Construction and tained within Thus, 3 of the Construction Lien Act. including 302, of Act, was a substantial original particularized laws, consisted of lien mechanics’ qualifications
procedures for and recovery of a lien. entirely of new set 2 of the act was an Part adoption in at the time of the act’s concerning disagreement term "substantial whether the 5 There is Churchfield, ambiguous compliance” See Fischer-Flack v nature. (the ambiguous). phrase compliance”
supra Cf. "substantial at 611 Associates, App unambiguous). Co v Turner-Fisher Norcross (1987) (the language of 302 is clear and NW2d extrapolate However, upon today to the term is not called this Court plaintiff’s compliance” actions or determine whether the "substantial conform to that term’s definition. 26.316(101)- 570.1101-570.1128; act, MSA 6 Part 1 of the MCL 26.316(128), filing 570.1201-570.1207; procedures ery 26.316(305), guidelines procedures for establishes detailed act, recovery MCL liens. Part of construction 26.316(201)-26.316(207), provides creates and MSA recovery lien recov the homeowner construction for under 26.316(301)- act, 570.1301-570.1305; MCL MSA fund. Part 3 of the application and construction. sets forth the act’s 26.281-26.310, 570.1-570.30; repealed by 1980 PA MCL MSA §303. inconsequential exceptions a of the that did not become The (liens upon 570.2; land MCL MSA 26.282 Construction Lien Act are 26.284(1)(false 570.4a; wife); by jointly MCL husband and held defraud); 570.28; by intent to MCL made contractor with statements MSA 26.308 (notice proceedings by publication). 1993] Lien Fund v Const by Dissenting Opinion Mallett, homeowner the defendant 1982. Part established promulgated rules and fund and lien fund, procedures its administration. for periodic resi on various assessments financed Depart licensees, was created within dential Regulation.9 Licensing fund cre ment against an action to foreclose ated defenses Thus, con lien. while a residential may entirely valid, homeowners lien struction may protect multiple payments from themselves indicating they paid filing an affidavit department cooperated with the contractor and not colluded and have the defense of person payment any other to obtain purposes, importantly present fund.10 More provides remedy for lien fund also defendant precluded from otherwise be claimants who would recovering of the lien because a construction protection under the act. homeowner’s imprecise § 302 and the Given unique statutory history becomes Legislature’s quite intention difficult to discern the plain language Clearly, of the statute. designed protect the conscien In from fraudulent contractors. tious tradesmen *11 purpose, attempt this this Court an should to achieve § and 302 a liberal construction applicable part 2 If the it of the act. find that is Legislature only apply the §302 intended that perfecting procedures part lien under for a construction placed part § in 1 of 1, it 302 then would have limiting language expressly provided the the act or application that the § 302 to 1. We believe of placement more in 3 of the act was of 302 9 Licensing Regulation Department now known as the is Regulation. Occupational See Executive and Professional Bureau of No. 1991-9. Order 10 26.316(203X1). 570.1203(1); MCL 442 179
192 Mich Dissenting Opinion Mallett, utility”;11 deliberate, it was than "a matter of a Legislature, on the affirmative decision evidencing applicable § 302 its intention that be including part throughout 2. provision statutory its en
A be read in should tirety with rest in connection provision statute, an act to be read and each is every provision as so with reference other produce an In re Forfeiture of harmonious whole. (1989); 242, $5,264, 251; 432 439 246 Mich NW2d Ass’n, v Police 408 Mich Detroit Detroit Officers (1980). words, 481; 68 In 294 other due NW2d given be to all sections to consideration must produce an harmonious and consistent enactment Dep’t Treasury, v of the entire statute. Preston (1991). Reading App 491; 476 455 190 Mich NW2d entirety, in its the Construction Act applicable to. should made clear 302 be includ for collection from 203(3)(h).12 ing § urges a
The defendant this Court to consider development of line of that illustrate the cases compliance Contrary to the doctrine.13 substantial defendant’s
assertions, substantial judicially In mechanics’ not a lien act of rent created doctrine. original
1897,14
the cur
version of
appears
§ 302
in
27._
11Ante at 184.
12Admittedly,
difficulty
requiring
in
is an inherent
subcon-
there
comply
statutory provision
substantially
re-
tractor
quires
However,
party.
another
this Court
is not
licensure of
compli-
upon today
called
to determine the standard
substantial
203(3)(h).
fact,
adequate safeguards
may,
in
There
ance with §
difficulty
remedy any
application.
place
within the
statute
Metal,
Dufty
Properties,
Michigan Roofing
Inc v
Rd
& Sheet
732;
(1979),
App
409 Mich
Mich
Kortz, 448; App Superior American 117 Mich 324 NW2d (1983). Fry, App Homes v 343 NW2d
14 1897PA 143. *12 Fund v Const Lien 1993] Dissenting Opinion remedial to be a hereby declared This act liberally to secure construed statute and thereof; results, purposes and intents beneficial pro- compliance with its several and a substantial validity for the be sufficient visions shall for, give provided hereinbefore lien or liens enforce the same. to the courts to jurisdiction PA [1897 143.] state for
Thus, has existed this the doctrine role has an essential played nearly century lien laws. development property proffered by the cases to follow We decline residen involve the then-existent defendant which Act or act,15 Construction Lien not the tial builders theory behind predecessor. .licensure cases, recovery In those is deterrence. requirement By an unlicensed contractor. being sought by was contractor, to an unlicensed a claim denying unlicensed enti sought discourage Legislature De in residential construction. engaging ties from denying plain not be achieved by terrence would pur from the fund Plumbing recovery tiff Brown Lien Act. Brown Plumb to the Construction suant contributed to the ing fully licensed and Primus Energy denied because of but was Legislature licensure. Should the Homes’ lack of compli that strict and not substantial determine in the fu required ance with shall be ture, made. change easily can be would affirm the decision of the
Accordingly, we
trial
court
Appeals
properly
Court
disposition
plaintiff’s
summary
motion
granted
2.116(C)(9)
(10).
to MCR
On the basis
pursuant
construction,
and the
statutory
the rules of
Act,
we
remedial nature of the Construction
to sub-
it is sufficient
for a lien claimant
believe
MCL 338.1501
et
seq.;
18.86(101)
et
seq.
Cavanagh, concurred with