Vineyard v. RLS Construction

Dec 30, 2021

20200633-CA

Versions:2021 UT App 144

Opinion

HARRIS, Judge:

¶1 A commercial tenant hired a contractor to work on improvements to the leased property, but the tenant failed to pay for the work performed. The contractor filed a construction lien against the property, and the tenant‘s landlord—the record owner of the property—sued to remove the lien, asserting that it could attach only to the tenant‘s leasehold interest and not to the landlord‘s fee interest in the property. The district court entered judgment in favor of the contractor, concluding that, under Utah‘s current statutory scheme, the lien attached to the landlord‘s interest in the property. The landlord appeals, and we affirm.

BACKGROUND¹

¶2 Vineyard Properties of Utah LLC (Vineyard) is the record owner of a 63,000-square-foot commercial building (the Property). In 2017, Vineyard leased the Property to a tenant (Tenant); the lease term was for sixty-seven months, and Tenant negotiated for rent reductions over the first six months of the lease that were apparently designed to provide Tenant the financial flexibility to be able to pay for improvements to the Property that it believed were necessary to its business.

¶3 Soon after signing the lease, Tenant hired RLS Construction LLC (RLS) to make certain improvements to the Property. These improvements consisted mainly of electrical projects—wiring the Property for workstations, voice and data communication jacks, and electrical outlets for forklifts and conveyors—but also included installing flooring and cubicles, and trenching the concrete floor to run wiring for the electrical projects. Vineyard was aware of and authorized Tenant to carry out the work, although Vineyard did not hire RLS and did not contractually obligate itself to pay for the work. Thereafter, RLS commenced construction and filed the requisite preliminary notice with the Utah State Construction Registry, noting that it was working pursuant to a contract with Tenant.

¶4 Upon completion of its work on the Property, RLS invoiced Tenant for payment, but Tenant made only a partial payment, leaving an unpaid balance of $13,707.40. Tenant then abandoned the Property, even though many months still remained on the lease term. After realizing that the invoice would not be paid in full, RLS recorded a construction lien against the Property for the remaining balance. In the lien, RLS recited that it had been employed by Tenant and that it had provided “tenant improvements” to the Property. (Quotation simplified.)

¶5 Vineyard then sued RLS, asserting that RLS‘s lien could “only extend and attach to [Tenant‘s] interest in the Property.” In its request for relief, Vineyard asked the district court to nullify the lien and issue a judicial declaration that it was “an unlawful and unauthorized encumbrance” on the Property. RLS responded by filing a counterclaim against Vineyard and a third-party complaint against Tenant, seeking (among other things) foreclosure of its lien against both Tenant and Vineyard. Tenant failed to respond, and default judgment was eventually entered against it and in favor of RLS. On their claims against each other, Vineyard and RLS filed motions for summary judgment, each contending that it was entitled to judgment as a matter of law.

¶6 In their competing motions, Vineyard and RLS presented conflicting interpretations of Utah‘s construction lien statutes. See generally Utah Code Ann. §§ 38-1a-101 to -805. RLS contended that its lien attached to Vineyard‘s interest in the Property because RLS had done work on the Property and Vineyard was the “owner” of the Property, as that term is now statutorily defined. See id. § 38-1a-102(26) (LexisNexis Supp. 2021). By contrast, Vineyard claimed that RLS‘s lien attached only to Tenant‘s leasehold interest in the Property because Vineyard had not contracted for the work.

¶7 After briefing and oral argument, the district court ruled in favor of RLS, concluding “that construction liens attach to the property at issue, absent any requirement to show that improvements requested by a tenant were installed at the direction of the landlord.” The court determined that Vineyard was the only “owner” of the Property and that RLS‘s lien therefore attached to Vineyard‘s interest in the Property, and on that basis granted RLS‘s motion. Later, the court entered judgment against Vineyard and in favor of RLS in the amount of $13,707.40, plus interest, costs, and attorney fees.

ISSUE AND STANDARD OF REVIEW

¶8 Vineyard now appeals, and asks us to reverse the district court‘s grant of summary judgment to RLS. We review such orders for correctness, affording the district court‘s ruling no deference. See Shree Ganesh, LLC v. Weston Logan, Inc., 2021 UT 21, ¶ 11, 491 P.3d 885.

ANALYSIS

¶9 Vineyard does not challenge the validity of RLS‘s construction lien; instead, it asserts that the district court incorrectly adjudged its scope. As Vineyard sees it, RLS‘s lien attaches only to Tenant‘s leasehold interest, and not to Vineyard‘s own fee interest in the Property. RLS takes a different view, and asserts that—regardless of whether its lien also attaches to Tenant‘s leasehold interest—its lien certainly attaches to Vineyard‘s fee interest. This issue matters, because construction liens against an owner‘s fee interest in real property tend to be more valuable than construction liens against a tenant‘s leasehold interest; indeed, a tenant possesses only a right to occupy the property in return for making specific lease payments and, unless the lease payments are well below market rate, there is often little value to be gained by foreclosing upon and selling a tenant‘s leasehold interest. See, e.g., Martindale v. Adams, 777 P.2d 514, 516 n.2 (Utah Ct. App. 1989) (noting that the contractor had attempted to foreclose a construction lien only against the landlord and not the tenant, and hypothesizing that this was “perhaps because the value of this leasehold . . . was marginal“).

¶10 Had this issue arisen a decade ago, Vineyard would have had the more persuasive argument. But, as we discuss, amendments made to Utah‘s construction lien statutes in 2011 and 2012 changed the legal landscape and now foreclose Vineyard‘s position. Accordingly, the district court correctly determined that RLS‘s lien attached to Vineyard‘s fee interest in the Property.

¶11 We begin with a brief general discussion of Utah‘s construction lien statutes, before transitioning into an overview of how those statutes were interpreted, in the landlord-tenant context, prior to the 2011 and 2012 amendments. We then discuss those amendments in detail. Finally, we assess the parties’ competing interpretations of the statutory scheme, and conclude that RLS‘s interpretation of the current construction lien statutes is the one most in keeping with the statutes’ plain language.

A

¶12 One important purpose animating Utah‘s construction lien statutes is “to protect . . . those who perform the labor and furnish the materials which enter into the construction of a building or other improvement,” including “original contractors, subcontractors, and others who enhance the value of real property through improvements.” Sill v. Hart, 2007 UT 45, ¶¶ 8, 12, 162 P.3d 1099 (quotation simplified). Construction lien statutes advance this purpose by preventing property owners “from taking the benefits of improvements placed on [their] property without paying for the labor and material that went into them.” Frehner v. Morton, 424 P.2d 446, 447 (Utah 1967).

¶13 But as our supreme court recently pointed out, Utah‘s construction lien statutes do “more than just protect lien claimants in every conceivable situation.” See Lane Myers Constr., LLC v. National City Bank, 2014 UT 58, ¶ 27, 342 P.3d 749. These statutes represent “an attempt by the legislature to balance competing policy considerations,” id. (quotation simplified), such as “assuring clear notice for property owners and facilitating finality in a field—real estate transactions—where that policy is paramount,” VCS, Inc. v. Utah Cmty. Bank, 2012 UT 89, ¶ 20, 293 P.3d 290. Indeed, at a conceptual level, construction lien statutes represent a legislative effort to “assign the risk of loss, and [an] attempt[] to balance the rights and duties of owners, subcontractors, and materialmen.” See 53 Am. Jur. 2d Mechanics’ Liens § 11 (2021) (quotation simplified).

¶14 Historically, our supreme court issued firm instructions that Utah‘s construction lien statutes were to be “broadly construed” in favor of contractors. See, e.g., Sill, 2007 UT 45, ¶ 8; Interiors Contracting Inc. v. Navalco, 648 P.2d 1382, 1386 (Utah 1982). More recently, however, our supreme court has indicated that, because the area is governed by statute and therefore the enacted laws already reflect our legislature‘s effort to balance competing policy interests, a court‘s task in interpreting Utah‘s construction lien statutes is to “implement the particular balance of policies reflected in the terms of [the] statute[s].” See VCS, 2012 UT 89, ¶ 22. The answers to many questions about our construction lien statutes will be supplied simply by the statutes’ plain text, without the need to apply any interpretive gloss. Id. ¶ 23. Indeed, “[w]here the language of the statute is clear, that language controls and cannot be overridden by a presumed statutory purpose“; while a court‘s “understanding of purpose . . . can be employed to inform and resolve ambiguities in the text[,] it cannot be used to establish an ambiguity that does not exist, or to override the meaning of a statute that is otherwise plain.” Id. Any principle of “liberal construction” of lien statutes in favor of contractors is to function “simply [as] a tie-breaker, giving the benefit of the doubt” to contractors in those “rare case[s] where” application of ordinary principles of statutory interpretation results “in a dead heat without an apparent winner.” See Lane Myers, 2014 UT 58, ¶¶ 25–26 (quotation simplified).

B

¶15 Prior to 2011, Utah‘s construction lien statutes provided, in relevant part, as follows:

Contractors, subcontractors, and all persons performing any services . . . used in the construction, alteration, or improvement of any building or structure or improvement to any premises in any manner[,] . . . shall have a lien upon the property upon or concerning which they have rendered service, performed labor, or furnished or rented materials or equipment for the value of the service rendered, labor performed, or materials or equipment furnished[,] . . . whether at the instance of the owner or of any other person acting by his authority . . . . This lien shall attach only to such interest as the owner may have in the property.

Utah Code Ann. § 38-1-3 (LexisNexis 2010) (emphasis added).

¶16 At the time, the statutes had no general internal statutory definition of “owner.” See id. § 38-1-2 (containing general statutory definitions only for the terms “contractor” and “subcontractor“). But in two other sections of the construction lien statutes, the legislature called for specialized—and different—definitions of the term “owner.” First, in the section dealing with filing a notice of intent to obtain final completion, the legislature specified that a specialized definition of “owner” was to be imported from a different statutory title. See id. § 38-1-40 (stating that an “owner, as defined in Section 14-2-1, . . . shall file . . . a notice of intent to obtain final completion“). In that other statutory title, “owner” was defined as “any person contracting with the original contractor for construction, alteration, or repair” on a non-residential property. See id. § 14-2-1. And second, in the section dealing with filing actions to enforce construction liens in the residential context, the legislature specified that another, and different, specialized definition of “owner” was to be imported from yet another separate part of the Utah Code. See id. § 38-1-11 (stating that, “[a]s used in this section, . . . ‘owner’ is as defined in Section 38-11-102“). In that separate statutory part, “owner” was defined as “a person who . . . contracts with” either a contractor or a developer with respect to a residential property. See id. § 38-11-102(17).

¶17 In light of the absence of any general internal statutory definition of “owner” that was to be used in applying section 38-1-3, Utah appellate courts, in a series of cases, supplied a judicially determined understanding of “owner” broad enough to potentially include both landlords and tenants. See Navalco, 648 P.2d at 1386 (stating that, under then-applicable statutes, “a lessee may be ‘an owner‘” and that a lessee‘s “leasehold may be subjected to a mechanic‘s lien“); see also Buehner Block Co. v. Glezos, 310 P.2d 517, 520 (Utah 1957) (“[I]t is well settled that a lessee is an owner within the meaning of the mechanics’ lien statutes . . . .“); John Wagner Assocs. v. Hercules, Inc., 797 P.2d 1123, 1130 n.6 (Utah Ct. App. 1990) (stating that “the holder of an interest in realty which is less than fee title in the soil may be considered an owner for purposes of the Mechanic‘s Lien Statute“).²

¶18 Using this judicially derived understanding of “owner,” and relying heavily on the statutory language referring to the need for contractors to be retained “at the instance of the owner or of any other person acting by his authority,” Utah appellate courts further determined that a construction lien was valid only against the specific “owner” at whose “instance” the work was done, and not against any other “owners.” See, e.g., Navalco, 648 P.2d at 1386 (quotation simplified) (stating that “[t]he statutory language ‘at the instance of . . .’ requires either an express or implied contract between the lessor or his agent and the contractor” for the construction lien to be valid against the lessor‘s interest in the property); Glezos, 310 P.2d at 520 (stating that a lessee‘s “interest is subject to a lien for improvements made under a contract with him,” and that “[t]his lien may attach to and be enforced against his leasehold estate“).³ Indeed, we stated that the “at the instance of” statutory language has long been understood to mean simply that the owner of real property, within the meaning of the mechanics’ lien law, can cause only his or her particular ownership interest, or bundle of property rights, to be burdened by a mechanics’ lien. Where the owner who directs property improvement is, for example, a lessee who directs such improvement without the authority of the lessor, only the leasehold interest is burdened by the resulting mechanics’ lien; the lessor‘s interest is not affected. Butterfield Lumber, Inc. v. Peterson Mortgage Corp., 815 P.2d 1330, 1333–34 (Utah Ct. App. 1991).

¶19 And our supreme court was clear that, under the then-applicable statutes, a landlord was not subject to a construction lien filed by a contractor of a tenant “simply on the basis that the [landlord had] knowledge that improvements [were] being made.” See Navalco, 648 P.2d at 1386. Only if the landlord had hired the contractor, or if the tenant had been acting as the landlord‘s agent in hiring the contractor, could the landlord‘s ownership interest be encumbered by that contractor‘s construction lien. See id.; see also Zions First Nat‘l Bank v. Carlson, 464 P.2d 387, 389 (Utah 1970) (stating that the “critical issue” in the case was “whether [the landlord] impliedly authorized” the work and “thus impliedly granted its lessee authority to bind its fee interest“); Advanced Restoration, LLC v. Priskos, 2005 UT App 505, ¶¶ 26, 28, 30–31, 126 P.3d 786 (stating that the landlord was subject to a lien if “the facts indicate[d] that the repairs were really for the benefit of [the landlord] and that he was having . . . work done through [the tenant]” (quotation simplified)).

C

¶20 In 2011 and 2012, our legislature amended relevant provisions of the construction lien statutes. Two of these amendments are, for present purposes, of significance.

¶21 First, and most importantly, in 2011 the legislature removed the “at the instance of” language from the statute. See Act of Mar. 7, 2011, ch. 339, § 4, 2011 Utah Laws 1955, 1956 (amending Utah Code Ann. § 38-1-3, now codified at Utah Code Ann. § 38-1a-301) (referred to herein as “Section 301“).

¶22 Second, in both 2011 and 2012, the legislature expanded the number of terms that were given a general internal statutory definition for use throughout the entire set of construction lien statutes. See id. at 1955–56 (amending Utah Code Ann. § 38-1-2, now codified at Utah Code Ann. § 38-1a-102); Act of Mar. 2, 2012, ch. 278, § 7, 2012 Utah Laws 1271, 1276–78 (amending Utah Code Ann. § 38-1-2 and recodifying it as Utah Code Ann. § 38-1a-102). In particular, the 2012 amendments added an internal statutory definition for the terms “owner” and “project property.” See Act of Mar. 2, 2012, ch. 278, § 7, 2012 Utah Laws 1271, 1277 (now codified at Utah Code Ann. § 38-1a-102(26), (31)). “Owner” was defined as “the person who owns the project property.” Id. And “project property” was defined as “the real property on or for which . . . construction work is or will be provided.” Id.

¶23 Notably, even while supplying—for the first time—a generally applicable statutory definition of “owner,” the legislature chose to keep the two specialized definitions of “owner” that were to be applied in the two specific situations discussed above. See supra ¶ 16; see also Utah Code Ann. §§ 38-1a-506(1), -701(1) (LexisNexis 2018) (referred to herein as “Section 506” and “Section 701“). As used in those specific contexts, “owner” remained defined, at least in part, by reference to the person or entity who contracted with the contractor. See id. But, significantly, our legislature did not choose to import these already-existing specialized definitions of “owner” into either Section 301 of the recodified statute or into the newly enacted generally applicable definition of the term; instead, our legislature directed that, unless otherwise specified in a particular section, “owner” was to be defined simply by reference to the person or entity that “own[ed] the project property.” See id. § 38-1a-102(26).

¶24 After the 2011 and 2012 amendments, “a person who provides . . . work on or for a project property has a lien on the project property for the reasonable value of the” work, but that lien “attaches only to the interest that the owner has in the project property that is the subject of the lien.” Id. § 38-1a-301(1), (4). In this context, “owner” means “the person that owns the project property.” Id. § 38-1a-102(26). And there no longer exists any statutory provision linking a lien‘s efficacy against a landlord to whether the contractor was retained “at the instance of” any particular person.

D

¶25 With this background in mind, we now turn to examination of the parties’ proffered interpretations of the relevant provisions of the current construction lien statutes. When faced with a question of statutory interpretation, our goal is “to understand what the Legislature intended,” State v. Hatfield, 2020 UT 1, ¶ 16, 462 P.3d 330 (quotation simplified), and to give effect to that intent, State v. Rasabout, 2015 UT 72, ¶ 10, 356 P.3d 1258. “The best indicator of legislative intent is the plain language of the statutes themselves.” Hertzske v. Snyder, 2017 UT 4, ¶ 10, 390 P.3d 307. When examining statutory language, “we presume that the legislature used each word advisedly.” Colosimo v. Gateway Cmty. Church, 2018 UT 26, ¶ 46, 424 P.3d 866 (quotation simplified). Where the legislature provides a statutory definition of a term, we apply that definition. See O‘Hearon v. Hansen, 2017 UT App 214, ¶ 24, 409 P.3d 85. Where no specialized statutory definition is provided, we interpret statutory language “according to the plain meaning of [its] text.” See Olsen v. Eagle Mountain City, 2011 UT 10, ¶ 9, 248 P.3d 465 (quotation simplified); see also O‘Dea v. Olea, 2009 UT 46, ¶ 32, 217 P.3d 704 (stating that courts should interpret statutory language in accordance with its “common, daily” usage (quotation simplified)). Omissions are assumed to be purposeful. Colosimo, 2018 UT 26, ¶ 46. Indeed, “we will not infer substantive terms into the text that are not already there. Rather, the interpretation must be based on the language used.” Arredondo v. Avis Rent A Car System, Inc., 2001 UT 29, ¶ 12, 24 P.3d 928 (quotation simplified).

¶26 In examining statutory language, we consider the relevant statute in its entirety, construing “each part or section . . . in connection with every other part or section so as to produce a harmonious whole.” See State v. Stewart, 2018 UT 24, ¶ 13, 438 P.3d 515 (quotation simplified). “Wherever possible, we give effect to every word of a statute, avoiding any interpretation which renders parts or words in a statute inoperative or superfluous.” Id. ¶ 12 (quotation simplified). And it is helpful to keep in mind that “the Legislature is aware of our case law,” see Olseth v. Larson, 2007 UT 29, ¶ 39, 158 P.3d 532, and that, in some instances, reviewing statutory provisions “against the backdrop of relevant case law helps illuminate the legislature‘s intent,” see Kamoe v. Ridge, 2021 UT 5, ¶ 23, 483 P.3d 720.

¶27 In this case, the primary statutory provision at issue—Section 301—states that “a person who provide[d] . . . construction work on . . . a project property has a lien on the project property,” but that a lien “attaches only to the interest that the owner has in the project property.” See Utah Code Ann. § 38-1a-301(1), (4). As noted, the “project property” is “the real property on or for which” the construction work is done, id. § 38-1a-102(31), and an “owner” is “the person that owns the project property,” id. § 38-1a-102(26). It is undisputed that RLS performed construction work on the Property, and that RLS has a valid lien against at least part of the Property, but the parties’ agreement ends there.

¶28 Vineyard acknowledges the validity of RLS‘s lien, at least as against Tenant‘s interest, but contends that the lien attaches only to Tenant‘s leasehold interest in the Property because only Tenant, and not Vineyard, contracted for RLS to perform the work. For support, Vineyard relies largely on well-established Utah case law interpreting the construction lien statutes, and asserts that this case law continues to be controlling even after the 2011 and 2012 changes to the statutory text. RLS, on the other hand, asserts that its lien attaches to Vineyard‘s fee interest in the Property, and offers a syllogism, grounded in the current statutory text, in support of its position: the entire Property is the “project property“; Vineyard is an “owner” of that project property; and therefore RLS‘s lien attaches to Vineyard‘s interest in the Property. In our view, RLS offers the interpretation of the statute that is most consistent with the current statutory text.

¶29 We agree with RLS that the statutory definition of “project property” is broad enough to include Vineyard‘s fee interest in the Property. As defined, “project property” is “the real property on or for which” the work was performed. See id. § 38-1a-102(31). This is an expansive definition that appears to reference the entire realty upon which the work was performed, including all the “sticks” in the proverbial “bundle” of property rights. See Garfield County v. United States, 2017 UT 41, ¶ 18 n.47, 424 P.3d 46 (referring to “real property” as “the numerous rights and privileges attendant to ownership of property, the whole bundle of sticks” (quotation simplified)). At a minimum, such a definition would necessarily have to include the fee interest in a parcel of real property. See, e.g., Property, Black‘s Law Dictionary (11th ed. 2019) (defining “real property” as “[l]and and anything growing on, attached to, or erected on it, excluding anything that may be severed without injury to the land“).

¶30 Vineyard‘s contrary argument—that “project property” is merely a reference to the interest in the Property held by the person or entity that hired the contractor to perform the work—is simply not supported by the current statutory text. Our legislature could, of course, have elected to define “project property” more narrowly. It would certainly have been better for Vineyard if the legislature had specified that “project property” consists only of the property interest held by the person or entity who commissioned the work. But none of that language appears in the statute, and “we will not infer substantive terms into the text that are not already there.” See Arredondo, 2001 UT 29, ¶ 12 (quotation simplified). Our legislature selected an expansive definition of “project property,” and we must give that definition effect according to its plain meaning. We therefore interpret “project property” in the manner advanced by RLS, namely, that the term is broad enough to include Vineyard‘s fee interest in the Property, even though Vineyard did not hire RLS to perform the work. Accordingly, under the terms of Section 301—which affords RLS a “lien on the project property“—RLS has a lien on the entire Property, including Vineyard‘s fee interest.

¶31 But under subsection (4) of Section 301, a construction lien “attaches only to the interest that the owner has in the project property.” Utah Code Ann. § 38-1a-301(4) (emphasis added). Vineyard directs our attention to this statutory subsection and asserts that, even if RLS‘s lien is valid against the entire Property, it does not “attach” to anything other than Tenant‘s leasehold interest, because Tenant is the only “owner” that commissioned the work. To evaluate Vineyard‘s argument, we must examine the relatively new statutory definition of “owner” provided in the construction lien statutes.

¶32 For decades, the term “owner“—as used in most sections of Utah‘s construction lien statutes—had no specific statutory definition, and therefore Utah courts stepped in to provide one, at least in cases involving tenant improvements. As noted, those courts concluded that “owner” was broad enough to potentially include both landlords and tenants, and that a construction lien attached only to the interest of the specific “owner” at whose “instance” the work was done, and not to the interests of any other “owners.” See, e.g., Navalco, 648 P.2d at 1386. This understanding of the term “owner” was heavily dependent on the statutory language, present until 2011, indicating that contractors needed to be retained “at the instance of the owner or of any other person acting by his authority.” See, e.g., id.; Butterfield Lumber, 815 P.2d at 1333–34.

¶33 But in 2011, our legislature removed the “at the instance of” language, and in 2012 it provided—for the first time—a generally applicable statutory definition of the term “owner,” even as it opted to keep in place the specialized definitions of that term for use in Sections 506 and 701. See supra Part C. Notably, the legislature decided not to add a section-specific definition of “owner” for use in Section 301—as it had in Sections 506 and 701—and therefore the general statutory definition of “owner” added in 2012 applies to Section 301.

¶34 The definition of “owner” that it selected for general use—and therefore also for use in Section 301—was different from (a) the meaning of “owner” that had historically been judicially supplied in the tenant improvement context, (b) the definition of that term used in Section 506, and (c) the definition of that term used in Section 701. See supra ¶ 16; supra Part C. All three of those other definitions that were already in use defined “owner,” at least in part, by reference to which party hired or retained the contractor. The legislature, when considering statutory amendments, is presumed to be aware of Utah appellate case law, see Olseth, 2007 UT 29, ¶ 39, and it was certainly aware of the specialized definitions of “owner” used in Sections 506 and 701. It would have been easy for the legislature to have imported a form of one of those definitions into the statutes for use as the generally applicable statutory definition of “owner“; at a minimum, the legislature could have chosen to use one of those definitions as a specialized definition applicable only in Section 301. But it chose not to do any of those things, and we must infer that this choice was purposeful. See Colosimo, 2018 UT 26, ¶ 46 (stating that courts are to “deem all omissions to be purposeful” (quotation simplified)); cf. Bylsma v. R.C. Willey, 2017 UT 85, ¶ 64 & n.116, 416 P.3d 595 (noting that “the legislature is cognizant of the distinction between indemnity and contribution, and chose to foreclose only the latter,” and stating that the legislature‘s choice was “significant“).

¶35 Instead, the legislature enacted an entirely new—and extremely broad—definition of “owner” for use in all situations where a different specialized definition was not otherwise prescribed. Under this new definition, an “owner” is simply “the person that owns the project property.” See Utah Code Ann. § 38-1a-102(26). We have already determined that the “project property” includes the fee interest Vineyard has in the Property. For this reason alone, Vineyard is an “owner” as that term is now generally defined in the construction lien statutes.

¶36 Moreover, in examining the concept in another context, our supreme court stated that “ownership is a collection of rights to possess, to use and to enjoy property,” and includes “possession of a fee simple interest in land” as well as “interest[s] less than that of absolute ownership.” Jeffs v. Stubbs, 970 P.2d 1234, 1241–42 (Utah 1998) (quotation simplified).⁴ As the fee owner of the Property, Vineyard is unquestionably an “owner” of the Property under the current statutory definition of that term. And because Vineyard is an “owner” of the Property, RLS‘s construction lien attaches to Vineyard‘s interest therein. See Utah Code Ann. § 38-1a-301(4) (stating that a lien “attaches only to the interest the owner has in the project property“).

¶37 Vineyard resists this conclusion on several grounds. First, it relies on the pre-2011 Utah cases holding that a construction lien for tenant improvements attaches to the landlord‘s interest only if the landlord hired the contractor, or if the tenant was in essence acting as the landlord‘s agent in hiring the contractor. See, e.g., Navalco, 648 P.2d at 1386. But Vineyard‘s reliance on that line of cases is inapposite, because those cases were decided under a statutory scheme that has since been significantly altered. In particular, the courts deciding those cases needed to arrive at their own understanding of “owner” because the then-applicable statutes did not define that term, and those courts grounded their analysis of the issue in the “at the instance of” language, which has since been completely removed. Vineyard attempts to portray the 2011 and 2012 statutory changes as insignificant, but we disagree.⁵ Not only were those amendments part of a wholesale recodification and rearrangement of the construction lien statutes, but they also included two specific alterations that matter a great deal in cases like this one: the deletion of the “at the instance of” language, and the addition of new internal definitions of relevant terms. These changes operated to remove the entire statutory foundation upon which those prior cases rested their analyses, and rendered those cases no longer of much assistance in interpreting the current statute in this context.

¶38 Second, Vineyard asserts that RLS‘s interpretation renders superfluous subsection (4) of Section 301. That subsection provides that a construction lien “attaches only to the interest that the owner has in the project property.” Utah Code Ann. § 38-1a-301(4). According to Vineyard, if the terms “owner” and “project property” are defined broadly enough to include all parties with interests in the property, then a construction lien “would just attach to the project property and every owner‘s interest in it” pursuant to subsection (1), and the statutory language in subsection (4) “would serve no purpose at all.” We acknowledge Vineyard‘s point that subsection (4) does not seem to be doing much work in the current statutory framework. But it still has potential meaning, in at least two ways. First, as RLS posits, subsection (4) could be intended to clarify whether construction liens may apply to security interests in property held by lenders.⁶ Second, the subsection could be intended to make clear that a construction lien against one owner attaches only to that owner‘s interest, and that the limit of any owner‘s lien liability is therefore represented by the extent of that owner‘s interest in the property. See John Wagner Assocs., 797 P.2d at 1131 (interpreting similar language from the pre-2011 statute “to allow attachment of a mechanic‘s lien to the entire bundle of property rights belonging to the owner, whatever it may contain“). We are therefore not persuaded that subsection (4) is wholly superfluous.

¶39 Finally, Vineyard offers certain policy arguments, and asserts that RLS‘s interpretation of the construction lien statutes will lead to “untenable consequences” in the construction industry. In particular—and citing to a dispute that apparently once arose after pop artist Prince made extensive alterations to a luxury home he was leasing from basketball star Carlos Boozer⁷—Vineyard asserts that, under RLS‘s interpretation, “landlords would become involuntary guarantors for their tenants’ debts and obligations,” would be “forced to shoulder the costs of ‘improvements’ they did not want [and] did not agree to pay for,” and “would have no choice but to pass the financial burden on to their tenants, likely through significantly increased security deposits, rent, and insurance requirements.” We of course have no basis for estimating the extent to which

Vineyard‘s predictions might come to pass. But as RLS points out, there are sound policy reasons on the other side of the equation as well: RLS‘s interpretation gives contractors more assurance that they will be paid for their work, and places the risk of loss with the owners of the property, who retain whatever value the improvements add to the property.

¶40 It is not our task to weigh competing policy considerations. As noted, the task of drafting a set of construction lien statutes, by definition, includes the balancing of several competing policy interests. See 53 Am. Jur. 2d Mechanics’ Liens § 11 (2021) (noting that such statutes represent a legislative effort to “assign the risk of loss, and [to] attempt[] to balance the rights and duties of owners, subcontractors, and materialmen“). By selecting the language that appears in the current statutes, our legislature has expressed certain policy choices; when we are asked to interpret a statute, we are not “tasked with advancing public policy as we see it.” See VCS, Inc. v. Utah Cmty. Bank, 2012 UT 89, ¶ 22, 293 P.3d 290. Instead, we “must implement the particular balance of policies reflected in the terms of a statute.” Id. Thus, even if we “accepted . . . at face value” Vineyard‘s interpretation of the policies that motivate enactment of our construction lien statutes, “we could not properly accept [Vineyard‘s] invitation to vindicate” those policies. Id. ¶ 23. Our task is to interpret the statute enacted by the legislature, guided first and foremost by the language the legislature used. And where that language “is clear, that language controls and cannot be overridden by a presumed statutory purpose.” Id.

¶41 In the end, we conclude that RLS‘s suggested interpretation of Utah‘s construction lien statutes is the one most in harmony with the plain language of the current version of those statutes. RLS has “a lien on the project property,” including Vineyard‘s fee interest. See Utah Code Ann. § 38-1a-301(1). Vineyard is an “owner” of the project property, because it owns the fee interest in the project property. See id. § 38-1a-102(26). And RLS‘s lien attaches to “the interest that the owner has in the project property,” including Vineyard‘s fee interest in the Property. See id. § 38-1a-301(4).

CONCLUSION

¶42 Under the current version of Utah‘s construction lien statutes, RLS‘s lien attaches to Vineyard‘s fee interest in the Property. Accordingly, the district court correctly entered judgment against Vineyard and in favor of RLS.

¶43 Affirmed.⁸

CERTIFICATE OF MAILING

I hereby certify that on the 30th day of December, 2021, a true and correct copy of the attached OPINION was sent by standard or electronic mail to be delivered to:

DAVID M. KONO
SHANE L. KEPPNER
JEFFREY J GORRINGE
BENNETT TUELLER JOHNSON & DEERE LLC
DKONO@BTJD.COM
SKEPPNER@BTJD.COM
JGORRINGE@BTJD.COM

DAVID R. NIELSON
CHASE AMES
NATHAN D ANDERSON
SKOUBYE NIELSON & JOHANSEN LLC
DAVID@SNJLEGAL.COM
CHASE@SNJLEGAL.COM
NATHAN@SNJLEGAL.COM

HONORABLE CHRISTINE S. JOHNSON
FOURTH DISTRICT, PROVO DEPT

FOURTH DISTRICT, PROVO DEPT
ATTN: DEBBIE JACOBSEN
provoinfo@utcourts.gov

Judicial Secretary

TRIAL COURT: FOURTH DISTRICT, PROVO DEPT, 180401461
APPEALS CASE NO.: 20200633-CA

Notes

In reviewing a grant of summary judgment, “we view the facts and all reasonable inferences in a light most favorable to the party opposing the motion.” (quotation simplified). We recite the facts with that standard in mind.

In years past, construction liens were commonly referred to as “mechanic‘s liens,” and many of the older cases cited herein use this terminology. Today‘s statutory language, however, speaks in terms of “construction liens.” See Utah Code Ann. § 38-1a-101 (LexisNexis 2018) (stating that the statutory chapter dealing with such liens is to be known as “Preconstruction and Construction Liens“). In this opinion, therefore, when speaking in our own voice, we use the term “construction lien” instead of “mechanic‘s lien,” but where older cases use the term “mechanic‘s lien” we make no effort to alter their terminology.

Vineyard points out that many other jurisdictions observe this same rule. We have no doubt that this is the case. See, e.g., (“A contract for improvements between a lessee and a materialman does not subject the interest of the lessor to a lien unless a contractual relationship exists between the lessor and the materialman as well.” (quotation simplified)); (holding that, where a tenant contracted for the work, a construction lien is valid only against the tenant‘s leasehold interest unless the tenant was an agent of the landlord). But as far as we are aware, these decisions are driven by statutory language similar to the pre-2011 Utah statute. See, e.g., Ga. Code Ann. § 44-14-361(b) (West 2021) (stating that a construction lien “may attach to the real estate of the owner for which the labor, services, or materials are furnished if they are furnished at the instance of the owner“); Idaho Code Ann. § 45-501 (West 2021) (“Every person performing labor upon . . . any . . . building . . . has a lien upon the same for the work or labor done or professional services or materials furnished, whether done or furnished at the instance of the owner of the building . . . or his agent.“). After all, construction liens are creatures of statute, and the outcome of any construction lien question will be dictated by the particular statutory language at issue. Our analysis, as set forth herein, is compelled by the specific language used in Utah‘s statutes, and not by what other states’ courts have decided when interpreting their respective statutory language.

Given the posture of this case, the question of whether Tenant—as well as Vineyard—is also an “owner” of the Property is not before us. We note, however, that the current statutory definition of “owner” may well be broad enough to include any person or entity who owns any interest in the project property. The district court adopted a narrower interpretation of “owner,” as that term is used in the post-2012 statutory definition, concluding that the term included landlords but not tenants. Vineyard points out that the district court‘s narrow definition of “owner” may create problems in other sections of the construction lien statutes, including potentially the internal statutory definition of “original contractor.” See Utah Code Ann. § 38-1a-102(25) (LexisNexis Supp. 2021) (stating that an “original contractor” is one who “contracts with an owner“). We acknowledge Vineyard‘s point that, if tenants are not “owners,” it may become difficult to define “original contractors” in the tenant improvement context. But this conundrum is solved if the term “owner” is broad enough to include both landlords and tenants, both of whom possess at least a few “sticks” in the property rights “bundle.” See supra ¶ 30.

In this vein, Vineyard attempts to invoke legislative history. In particular, Vineyard points out that, during debate on the amendments, two legislators gave statements indicating that the amendments had been designed to be “policy neutral and did not alter the substance of the statute in any way,” and asserts that the legislative history is otherwise bereft of indications that the amendments were intended to “effectuate sweeping change (or any change for that matter) in how [construction] liens operate in the landlord/tenant sphere.” Vineyard colorfully asserts that “Legislatures . . . do not hide elephants in mouseholes,” (quoting (quotation simplified)), and contends that RLS and the district court are reading too much into the 2011 and 2012 amendments. As an initial matter, the statements of two legislators do not necessarily reflect the view of the entire legislative body. See, e.g., (noting “the potential pitfalls in attempting to divine the intent of a legislative body from a hand-picked selection of arguably-favorable comments“). Moreover, deleting the very language that had, for decades, served as the foundation for the analysis in a long line of appellate cases seems to us to be a rather large “mousehole.” But more substantively, “[w]e cannot properly invoke the legislative history in a manner overriding the terms of the statute.” . We may turn to legislative history only to “resolve ambiguities in the text of the law.” . For the reasons explained herein, the conclusions we reach are dictated by the plain and unambiguous text of the current version of the statutes. In the event that we have misperceived the intent of the legislature, it is of course free to make additional amendments.

No lender is a party to this action, and therefore we have no occasion to opine on whether this language does, or does not, have this effect.

See Maya A. Jones, That time former NBA All-Star Carlos Boozer almost sued Prince, The Undefeated (Apr. 20, 2018), https://theundefeated.com/features/that-time-former-nba-all-star-carlos-boozer-almost-sued-prince/ [https://perma.cc/YT9E-6S6C].

RLS also seeks an award of attorney fees incurred on appeal. “[I]n any action brought to enforce any lien under this chapter[,] the successful party shall be entitled to recover reasonable attorney fees . . . .” Utah Code Ann. § 38-1a-707(1) (LexisNexis 2018). RLS was awarded attorney fees after prevailing before the district court, and it has prevailed in this appeal. In this situation, RLS is entitled to recover its attorney fees on appeal, and we therefore grant RLS‘s request. See (“A party entitled by contract or statute to attorney fees below and that prevails on appeal is entitled to fees reasonably incurred on appeal.” (quotation simplified)). We remand to the district court for the limited purpose of quantifying that fee award.