Hawn Tool Co. v. Crystal Oil Co.Hawn Tool Co. v. Crystal Oil Co.
This is an appeal by plaintiff, Hawn Tool Company, from a judgment dismissing Hawn‘s claim against defendant Crystal Oil Company for failure to timely record oil well liens under the Oil, Gas, and Water Well Lien Act,
Crystal Oil Company is the owner and operator of two wells drilled in Jackson Parish by Explorer Drilling Company (EDCO), a drilling contractor hired by Crystal. EDCO contracted with Hawn Tool Company for equipment and materials used on the wells. EDCO failed to pay Hawn and Hawn filed suit against EDCO. Judgment was obtained against EDCO but EDCO was placed in involuntary bankruptcy before execution of the judgment.
Hawn then sought to enforce liens against the wells pursuant to
Hawn filed suit against Crystal on June 25, 1984, more than 22 months after the conclusion of its activity on Well No. E-1 and one year and 184 days after the conclusion of its activity on Well No. H-1.
The trial judge concluded Hawn lost its privilege because it did not file a notice claiming the privilegе within the statutory period of
The following issues are presented on appeal:
(1) Must a privilege granted by the Oil, Gas, and Water Well Lien Act be recorded within the statutory period to be effective or is recordation within the statutory period required only for the purpose of ranking?
(2) Must the 1983 amendment to
LSA-R.S. 9:4862 be given retroactive effect?(3) If failure to record within the statutory period forfeits only the superior ranking of the lien, when is the lien claimant‘s cause of action prescribed?
At the time the liens were filed and suit instituted,
If a notice of such claim or privilege, setting forth the nature and amount thereof, is filеd for record and inscribed in the mortgage records of the parish where the property is located within one hundred eighty days days [sic] after the last day of the performance of the labor or service, in the case of laborers, within one hundred eighty days after the last day of the doing, making, or performing of such trucking, towing, barging, or repairing, in the case of claimants doing, making, or performing such services, and in the case of furnishers of fuel, drilling rigs, stаndard rigs, machinery, equipment, material or supplies, within one hundred eighty days from the last date of the delivery of such fuel, drilling rigs, standard rigs, machinery, equipment, material or supplies to the well or wells, the privileges are superiоr to all other privileges
or mortgages against the property, except taxes or ...
Prior to a 1983 amendment of
Crystal argues the trial court correctly determined the privilege is lost for failure to record within the time period provided by
The Louisiana Supreme Court has resolved the issue. “In order to be effective the lien need not be recorded within the one hundred eighty days specified in
The prescriptive period applicable to the enforcement of liens recorded after the elapse of the statutory period or оf those liens which are unrecorded had not been determined by our supreme court. The supreme court in Louisiana Materials, specifically declined to resolve the issue and held on the facts of the case, “... at the least ... if suit is filed within one year оf the conclusion of the activity which gave rise to the privilege, assertion of the lien is timely.”
The holding of Louisiana Materials, supra, does not encompass the instant case as Hawn recorded its liens approximately sixteen and twenty months after the last equipment was delivered. The lien on Well E-1 was filed more than thirteen months after the expiration of the 180 day period. The lien on Well H-1 was filed one year and four days after the expiration of the 180 day period.
The First Circuit was recently confronted with determining the applicable prescriptive period for liens not recorded within the 180 day period. The court held “in regards to unrecorded liens or liens recorded outside the Section 4862 time period, suit must be filed within one year of the last day on which services are performed.” Genina Marine Services v. Arco Oil & Gas Co., 499 So.2d 257 (La.App. 1st Cir.1986). The Louisiana Supreme Court in Louisiana Materials, supra, refused to approve the correctness of the rule later adopted in Genina, supra. The court in Louisiana Materials, supra, stated:
“It suffices to conclude, at the leаst, that if suit is filed within one year of the conclusion of the activity which gave rise to the privilege, assertion of the lien is timely. In this case, Louisiana Materials filed their lien and lawsuit thereon three hundred and sixty-four days after their last suрply of clam shells.”
The court, while refusing to make a determination as to the prescription period on unrecorded liens or those liens recorded after elapse of the statutory period left
“And, for the unrecorded lien, we need not decide whether a lien claimant who fails to record his lien within the recordation period (one hundred eighty days from last service performed) has one year from the date of last service performed to assert his privilege, as was advanced by the Third Circuit in I.E. Miller, supra and the dissenting judge in C-Craft Marine, [Services, Inc. v. Llog Exploration Co., 470 So.2d 241 (La.App. 4th Cir.1985)], supra or whether a lien claimant who fails to record his lien within the recordation period has one year plus the recordation period in order to assert his lien.” Louisiana Materials, supra.
We decline to follow Genina, supra, and conclude the better view is that the privilege that is recorded after the elapse of the statutory period or is unrecorded prescribed one year from the last day of the statutory period. The claimant who records his lien within the statutory period [which is either 90 or 180 days] must institute suit within twelve months.
Recordation is not required to preserve the privilege. Louisiana Materials, supra. The attitude of the Louisiana Supreme Court as reflected from the holding of Louisiana Materials is to leave the cause of action for unrecordеd liens as viable as the cause of action for recorded liens, except for the purposes of ranking. In furtherance of this expressed policy, we hold that a lien claimant who fails to record his lien within the statutory period of
The statutory period within which the lien was required to be filed as of the date the services were rendered by Hawn in 1982 was ninety days. This provision of
The issue turns on the appropriate construсtion of the statutory period in
In Shreveport Long Leaf Lumber Co. v. Wilson, supra, the statute changing the method of maintaining the viability of a materialman‘s lien was held remedial and retroactive. In Bostick v. Intern. Minerals and Chemical Corp., supra, the court
We conclude the statutory period in
Having concluded the 180 day period contained in the 1983 amendment is applicable to this case we find that Hawn‘s claim had prescribed because more than one year and 180 days had elapsed since the services were rendered on each of the liened wells before suit was filed. We note that the same results would be reached even if we are in error in finding the provision of the 1983 amendment to
Under the rule adopted by us the prescription period applicable to the untimely or nonrecorded privilege is more nearly equal to the prescription period applicable to the timely recorded privilege than it would be under the rule enunciated in Genina, supra.
The trial judgment is AFFIRMED at appellant‘s costs.