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LEMOINE CO. OF ALABAMA v. HLH CONSTRUCTORS
62 So.3d 1020 (2010)
The LEMOINE COMPANY OF ALABAMA, L.L.C.
v.
HLH CONSTRUCTORS, INC.
1090847.
Supreme Court of Alabama.
November 19, 2010.
WOODALL, Justice. The Lemoine Company of Alabama, L.L.C. ("Lemoine"), subcontracted with HLH Constructors, Inc. ("HLH"), for HLH to perform plumbing work on a construction project. HLH subsequently sued Lemoine, alleging, among other things, that Lemoine had not paid HLH the balance due under the subcontract. The trial court entered a judgment in HLH's favor, awarding damages, interest, and attorney fees. We reverse and remand. Facts and Procedural HistoryVista Bella, Inc., and Lemoine entered into a contract, by which Lemoine agreed to act as general contractor on a condominium-construction project in Baldwin County ("the project"). Lemoine subcontracted the plumbing work for the project to HLH. During the course of construction, and pursuant to the terms of the general contract, Vista Bella withheld a 5% retainage1 on the work performed. Each month, Lemoine sent Vista Bella an application for payment, in which Lemoine set forth details regarding, among other things, the value of the work completed during the month and the amount of the retainage withheld with respect to that work. Also during the course of construction, and pursuant to the terms of its subcontract with HLH,2 Lemoine withheld a 5%
retainage with respect to HLH's work on the project. HLH sent monthly applications for payment to Lemoine. These applications, like the applications sent by Lemoine to Vista Bella, indicated the value of the work HLH had performed during the month and the retainage withheld with respect to that work. On July 3, 2007, a certificate of completion was issued for the project. On July 12, 2007, Lemoine billed Vista Bella for the retainage that had been withheld during construction. Vista Bella never paid the retainage. It appears that Vista Bella has paid Lemoine all amounts owed under the general contract, except for the retainage. Lemoine sued Vista Bella to recover the unpaid balance. Vista Bella failed to appear, and the trial court entered a default judgment in Lemoine's favor, awarding Lemoine $1,438,066.35 in damages, plus interest and costs. Lemoine states that, as of the date of trial in this case, Lemoine had not collected from Vista Bella any portion of the default judgment.
1. A retainage is "[a] percentage of what a landowner pays a contractor, withheld until the construction has been satisfactorily completed and all mechanic's liens are released or have expired." Black's Law Dictionary 1341 (8th ed.2004).
2. Paragraph 3 of the subcontract provides, in pertinent part:
"Subject to the conditions stated in this Subcontract, within 7 days after receiving a progress payment from [Vista Bella] under the contract, [Lemoine] shall make a progress payment to [HLH] equal to the value of the Completed Work, and Stored Material as of the corresponding Monthly Billing Date, to the extent approved by [Lemoine] and allowed and paid by [Vista Bella] on account of the Work, and after deducting (a) all previous payments, (b) current retainage (meaning a reserve equal to the Retained Percentage times the allowed value of completed Work and Stored Work, plus any extraordinary reserve provided for here) and (c) all charges or backcharges for services, materials, equipment and other items furnished or otherwise chargeable by [Lemoine] to [HLH]."
3. HLH argues that Lemoine owes it $90,102.95 and that this amount includes, among other things, charges for work HLH did in excavating and repairing a leaking gas line and charges for changes made to the water closets in unit 701 of the project. Lemoine argues that the unpaid balance under the subcontract is $65,902, which, according to Lemoine, represents the retainage under the subcontract, less $1,500 that Lemoine attempted to pay HLH, and less $20,000 that Lemoine says was designated in the subcontract for the installation of swimming-pool-deck drains. The drains were ultimately deemed unnecessary, and Lemoine argues that a change order deducting $20,000 from the original subcontract was issued.
4. Although the trial court did not make any findings of fact or specify the basis for its judgment, HLH argues that the trial court's award included "interest at 12% under the statute as well as ... attorney's fees." HLH's brief, at 9. The "statute" to which HLH refers is § 8-29-1 et seq., Ala.Code 1975. Section 8-29-3 provides, in pertinent part:
"(b) When a subcontractor has performed pursuant to his or her contract and submits an application or pay request for payment or an invoice for materials to a contractor in sufficient time to allow the contractor to include the application, request, or invoice in his or her own pay request submitted to an owner, the contractor shall timely pay to the subcontractor in accordance with the payment terms agreed to by the contractor and subcontractor....
"....
"(d) If the owner, contractor, or subcontractor does not make payment in compliance with this chapter, the owner, contractor, or subcontractor shall be obligated to pay his or her contractor, subcontractor, or sub-subcontractor interest at the rate of one percent per month (12% per annum) on the unpaid balance due."
Section 8-29-6 provides, in pertinent part:
"If the court finds in the civil action that the owner, contractor, or subcontractor has not made payment in compliance with this chapter, the court shall award the interest specified in this chapter in addition to the amount due. In any such civil action, the party in whose favor a judgment is rendered shall be entitled to recover payment of reasonable attorneys' fees, court costs and reasonable expenses from the other party."
"`[W]hen a trial court enters a judgment in a case and does not make specific findings of fact, we must assume that the trial court found the facts necessary to support its judgment, unless the findings would be clearly erroneous and against the great weight of the evidence.'" Ex parte Gilley, 55 So.3d 242, 245 (Ala.2010) (quoting Lakeview Townhomes v. Hunter, 567 So.2d 1287, 1289 (Ala.1990)). To award interest and attorney fees pursuant to § 8-29-6, the trial court must have concluded that Lemoine did not make payment "in accordance with the payment terms agreed to by the contractor and subcontractor," which, in this case, would be the terms of the subcontract. Therefore, we will assume the trial court's award was based upon HLH's breach-of-contract claim.
5. Black's Law Dictionary defines "condition precedent" as "[a]n act or event, other than a lapse of time, that must exist or occur before a duty to perform something promised arises." Black's Law Dictionary 312 (8th ed.2004).
6. Although HLH makes no argument regarding its claims on an open account and on an account stated, those claims fare no better than its work-and-labor claim. "`A contract which is definite in all its terms ... cannot be considered a mere open account.'" Wal-Mart Stores, Inc. v. Anniston Dev. Co., 853 So.2d 218, 220 (Ala.2002) (quoting Union Naval Stores Co. v. Patterson, 179 Ala. 525, 529, 60 So. 807, 808 (1912)). It cannot be seriously argued that the subcontract between Lemoine and HLH is not "definite in all its terms." "An account stated is an agreement between parties who have had previous monetary transactions that the statement of account and the balance struck are correct and a promise, express or implied, that the debtor will pay that amount." Gilbert v. Armstrong Oil Co., 561 So.2d 1078, 1081 (Ala.1990). Here, there is no evidence that the parties have agreed that any "statement of account and the balance struck are correct."
7. In light of our decision to reverse the trial court's judgment, we pretermit consideration of Lemoine's argument regarding the amount of the unpaid balance under the subcontract, including the amounts, if any, due for extra work performed on the project, and its argument regarding the award of interest and attorney fees pursuant to § 8-29-3, Ala.Code 1975.
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