Opinion
Civil Action No. 1:04-CV-3417-RLV.
June 16, 2005
ORDER
The plaintiffs filed the current action after Lien Filers, Etc. LLC ("Lien Filers") filed a materialman's lien on their property after they failed to pay Sigman and Sigman Gutters, Inc. ("Sigman") for allegedly unsatisfactory repair work done on their home. This matter is before the court on Lien Filers's motion to dismiss [hoc. No. 6] and Sigman's motion to dismiss [Doc. No. 9).
In this motion, defendant Sigman seeks only to dismiss the state law claims against it. Before submitting any further documents to the court, counsel for Sigman is directed to examine the Local Rules for the Northern District of Georgia and submit future documents in the proper form.
I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY
On November 17, 2003, the plaintiffs hired Sigman to install new gutters on their home, remove the old gutters, and repair damaged facia wood. The plaintiffs refused to pay Sigman for its work because they were not satisfied with the work. Thereafter, at the request of Sigman, Lien Filers placed a lien on the plaintiffs' property. The plaintiffs claim that this lien was placed on their property without cause and have alleged in Count One of their Complaint that Lien Filers violated the Fair Debt Collection Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq., by: (a) failing to send a validation notice under 15 U.S.C. § 1692g and (b) attempting to collect a debt in violation of 15 U.S.C. §§ 1692e(2) and 1692f(1) In addition, Counts Two and Three of the Complaint allege that both defendants violated the Georgia Fair Business Practices Act, O.C.G.A. § 10-1-390 et suq., by attempting to collect money for work that was negligently performed and not completed in a workman-like manner, and slandered and defamed the plaintiffs' title by falsely or maliciously filing a lien which impugns plaintiffs' title. Finally, in Count Four, the plaintiffs allege that Sigman breached their contract by failing to perform the repair work in a workman-like manner.In its response to Lien Filers's motion to dismiss, the plaintiffs attached as exhibits documents that were not part of their original pleadings. Therefore, this court will treat the current motions as motions for summary judgment.
II. LEGAL STANDARD
Rule 56(c) of the Federal Rules of Civil Procedure authorizes summary judgment when all "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show there is no genuine issue as to any material fact and . . . the moving party is entitled to judgment as a matter of law." The party seeking summary judgment bears the burden of demonstrating that no dispute as to any material fact exists. Adickes v. S.H. Kress Co., 398 U.S. 144, 156, 90 S.Ct. 1598, 1608 (1970); Johnson v. Clifton, 74 F.3d 1087, 1090 (11th Cir. 1996). The moving party's burden is discharged merely by "`showing' — that is, pointing out to the District Court — that there is an absence of evidence to support [an essential element of] the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317; 325, 106 S.Ct. 2548, 2554 (1986). In determining whether the moving party has met this burden, the court must view the evidence and all factual inferences in the light most favorable to the party opposing the motion. Johnson, 74 F.3d at 1090. Once the moving party has adequately supported its motion, the nonmovant then has the burden of showing that summary judgment is improper by coming forward with specific facts showing a genuine dispute. Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1356 (1986).In deciding a motion for summary judgment, it is not the court's function to decide genuine issues of material fact but to decide only whether there is such an issue to be tried. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251, 106 S.Ct. 2505, 2511 (1986). The applicable substantive law will identify those facts that are material. Anderson, 477 U.S. at 247, 106 S.Ct. at 2510. Facts that in good faith are disputed, but which do not resolve or affect the outcome of the case, will not preclude the entry of summary judgment as those facts are not material. Id.
Genuine disputes are those by which the evidence is such that a reasonable jury could return a verdict for the nonmovant. Id. In order for factual issues to be "genuine" they must have a real basis in the record. Matsushita, 475 U.S. at 586, 106 S.Ct. at 1356. When the record as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no "genuine issue for trial." Id.
III. DISCUSSION
Lien Filers contends that the plaintiffs' FDCPA claims are improper and should be dismissed. This court will address each of the plaintiffs' allegations under the FDCPA separately.The plaintiffs first allege that Lien Filers violated § 1692g by failing to send the plaintiffs a validation notice as is required by that section. Lien Filers contends that the plaintiffs' § 1692g claim should be dismissed because it never made an initial communication with the plaintiffs. Thus, without an initial communication, Lien Filers had no duty to send the plaintiffs a validation notice. The plaintiffs counter that the filing of the lien was the initial communication necessitated by § 1692g.
Section 1692g(a) requires "debt collectors" to provide "consumers" with a written notice containing various terms of the "debt" within five days of receiving an initial "communication." Therefore, this court must first determine whether providing the debtor with a copy of a lien, as is required by Georgia law, constitutes an initial "communication" under § 1692a(2). "The term `communication' means the conveying of information regarding a debt directly or indirectly to any person through any medium." § 1692a(2) Though this is an expansive definition, the United States Court of Appeals for the Eleventh Circuit has held that "a legal action does not constitute an `initial communication' within the meaning of the FDCPA." Vega v. McKay, 351 F.3d 1334, 1337 (11th Cir. 2003).
In Vega, the Eleventh Circuit was confronted with the issue of whether delivery of a summons and complaint packet constituted an initial communication within the meaning of the FDCPA. After examining the congressional policy behind the FDCPA, and the fact that the Federal Trade Commission does not consider a legal action to be an initial communication, the Eleventh Circuit held that the district court did not err in finding that a summons and complaint package did not constitute an initial communication.Id. at 1336-37.
The Eleventh Circuit further pointed to McKnight v. Benitez, 176 F.Supp.2d 1301 (M.D. Fla. 2001), as an accurate statement of the law in the Eleventh Circuit. This court further agrees with and adopts the reasoning found in McKnight.
This court concludes that the reasoning of Vega applies equally to the facts of the case at bar. Congress passed the FDCPA to "eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses." § 1692g(e). There is no indication that Lien Filers engaged in any abusive practices in providing the plaintiffs a copy of the lien papers. Rather, Lien Filers was merely complying with the Georgia law which required it to provide the plaintiffs with a copy of lien. See O.C.G.A. § 44-14-361.1(a) ("At the time of filing for record of his claim of lien, the lien claimant shall send a copy of the claim of lien by registered or certified mail or statutory overnight deliver to the owner of the property. . . .").
In Georgia, to perfect a materialman's lien, or any lien authorized under O.C.G.A. § 44-14-361, the person seeking to enforce the lien must take the following steps:
(1) file it in the records of the superior court where the property is located within three months of completing the work, (2) notify the property owner that he has filed the lien, and (3) file suit to enforce the lien within twelve months of the date the claim is due. None of these filings must be verified. However, within 14 days of filing suit, the lien claimant must file notice of the suit, and that notice must be made under oath. OCGA § 44-14-361.1(a)(3). If the lien is not perfected by suit and verified notice within 12 months of the contested bill's due date, the property owner may petition to have the lien cancelled. OCGA § 44-14-362.Simmons v. Futral, 262 Ga. App. 838, 840-41, 566 S.E.2d 732 (2003). Thus, the initial filing of the lien and the corresponding notice provided to the property owner are merely mandatory steps that must be taken by the materialman before he can seek to enforce the lean via a legal proceeding.
Though the plaintiffs are correct in citing Simmons for the proposition that a lien is not considered a legal pleading that is afforded absolute privilege against defamation claims under O.C.G.A. 51-5-8 until suit is filed to enforce it, the filing of a lien is, nevertheless, a prerequisite to filing a legal action to enforce the lien. Furthermore, there are two instances in the lien enforcement process where the materialman must notify the property owners of the fact that a lien has been filed on their property. Failure to comply with either of these notification requirements renders the lien unenforceable. These notification procedures also protect the property owners' rights by ensuring that they are adequately notified of the procedure instituted against them. This notification serves virtually the same purpose as the notice required by the FDCPA. Thus, this court concludes that providing a property owner with notification that a lien has been filed as required by § 44-14-361.1(a) is not an initial communication under § 1692g. Therefore, the plaintiffs' § 1692g claim must fail.
In their complaint, the plaintiffs also contend that Lien Filers violated § 1692e(2) of the FDCPA by attempting to collect a debt for work that was not performed in a workman-like manner. Section 1692e provides:
A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section: . . .
(2) The false representation of —
(A) the character, amount, or legal status of any debt; or
(B) any services rendered or compensation which may be lawfully received by any debt collector for the collection of a debt.
The plaintiffs argue that Lien Filers made a false representation concerning the amount of the debt when it filed the lien on the defendant's property listing the amount claimed by Sigman as $2,775.00. The plaintiffs argue that since they dispute the quality of the work performed by Sigman, they do not owe Sigman anything.
Thus, the plaintiffs essentially attempt to morph their breach of contract claim into an FDCPA claim. First this court notes that the parties had a contract for Sigman to perform services for the plaintiffs at an agreed upon price. The plaintiffs were not satisfied with these services and, therefore, refused to pay Sigman. Sigman disputes the plaintiffs' allegations that these services were not performed in a workman-like manner. To protect their interest in the value of the work performed, Sigman filed a lien in accordance with § 44-14-361, and the plaintiffs now attempt to characterize this as an abusive and deceptive collection practice prohibited by the FDCPA.
There is no indication that Lien Filers falsely represented the character, amount, or legal status of the plaintiffs' debt. Rather, Lien Filers simply filed a lien in the amount of the agreed upon contract price for work that was done, albeit in the plaintiffs' eyes, unsatisfactorily. The plaintiffs will have an opportunity to dispute the amount of the lien if and when Sigman chooses to enforce it. The plaintiffs do not claim that Lien Filers inflated the amount of their contract price with Sigman in the lien documents in an effort to extort additional money from them. Rather, they simply allege that they owe nothing to Sigman because Sigman performed unsatisfactory work. The FDCPA was intended to prohibit abusive and deceptive debt collecting procedures, not to serve as an additional cause of action each time there is a breach of contract action where one party deems the other party's performance inadequate. For these reasons, the plaintiffs' § 1692e(2) claim must fail.
For virtually the same reasons listed in this court's analysis of the plaintiffs' § 1692e (2) claim, the plaintiffs' § 1692f (1) claim must also fail. Section 1692f(1) provides:
A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section: (1) The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.
The plaintiffs have made no allegation that their contract with Sigman was less than the amount Sigman listed in the lien documents. Rather, while conceding there was a contract, the plaintiffs claim they owe Sigman nothing because they were not pleased with the work. Therefore, there is no indication that Lien Filers has attempted to collect an amount other than that authorized by the plaintiffs' original contract with Sigman. For these reasons, the plaintiffs' § 1692f(1) claim must also fail.
For the foregoing reasons, this court GRANTS that part of Lien Filers's motion seeking to dismiss the plaintiffs' federal claims, which this court treats as a motion for summary judgment. The court declines supplemental jurisdiction over the plaintiffs' state law claims asserted against lien Filers and Sigman; consequently, those claims are DISMISSED WITHOUT PREJUDICE.
SO ORDERED.