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Northern v. Sber Royal Mills

June 5, 2009

NORTHERN SITE CONTRACTORS
v.
SBER ROYAL MILLS, LLC AND SBER ROYAL MILLS COTTON SHED, LLC SHERIDAN ELECTRIC, INC.
v.
SBER ROYAL MILLS, LLC SHERIDAN ELECTRIC, INC.
v.
SBER ROYAL MILLS COTTON SHED, : LLC, ET AL RUSTIC FIRE PREVENTION, INC.
v.
SBER ROYAL MILLS COTTON SHED, : LLC, ET AL ROOFING CONCEPTS, INC.
v.
SBER ROYAL MILLS COTTON SHED, : LLC, ET AL CONSOLIDATED WITH: WESTBAY WELDING & FABRICATION, INC.
v.
SBER ROYAL MILLS, LLC. & ROYAL MILLS FEDERAL, LLC KITCHENS INTERNATIONAL, INC.
v.
SBER ROYAL MILLS, LLC & ROYAL MILLS FEDERAL, LLC. GRAYBAR ELECTRIC COMPANY, INC.
v.
SBER ROYAL MILLS, LLC & ROYAL MILLS FEDERAL, LLC EAGLE CARPET, INC.
v.
SBER ROYAL MILLS, LLC. GEM PLUMBING & HEATING COMPANY, INC.
v.
SBER ROYAL MILLS, LLC. JOSEPH TAVONE PAINTING CO., INC. V. (FORMERLY P.M. 2008-4544) SBER ROYAL MILLS, LLC. 2 NORTHEAST STEEL CORPORATION INC.
v.
SBER ROYAL MILLS, LLC, ET AL JESMAC, INC.
v.
SBER ROYAL MILLS, LLC, JESMAC, INC.
v.
SBER ROYAL MILLS, LLC, ET AL, J. D. CEMENT WORKS, INC.
v.
SBER ROYAL MILLS COTTON SHED, LLC, ET AL



The opinion of the court was delivered by: Lanphear, J.

DECISION

This matter first came on for hearing before Mr. Justice Lanphear on April 17, 2009 on Rockland Trust Community Development Corporation II's and Rockland Trust Company's motion for relief from subordination, for determination of priority, and for permission to foreclose its mortgages, pursuant to the Rhode Island Mechanics' Lien Law. The Court bifurcated these issues and in its May 1, 2009 decision, denied Rockland relief from subordination under Rule 60(b). The parties preserved their right to argue constitutional issues, which were heard by the Court on May 4, 2009 and are addressed herein. The Court's jurisdiction is pursuant to G.L. 1956 § 34-28-16.

I

Facts and Travel

This is a mechanics' lien case (consolidated with fourteen other such lien cases)

involving and a large mill renovation project along the Pawtuxet River in West Warwick, Rhode Island. The project comprises two parcels, which are both involved in this overall litigation. The first of these properties is known as the Cotton Shed, which is a proposed retail use project located at 186 Providence Street, Lot 10 of Assessor's Plat No. 26. The second property is a 250-unit residential use project, known as Royal Mills at Riverpoint, located on Lot 11 of Assessor's Plat No. 26.

After an action was instituted by Northern Site Contractors, Inc. to enforce a mechanics' lien, the Superior Court Clerk issued citations to various persons or entities which may have interests in the property. Similar petitions against the two parcels were subsequently filed, and additional citations issued. Rockland Trust Community Development Corporation II and Rockland Trust Company (hereinafter "Rockland"), the first and third mortgage holders on the Cotton Shed property, failed to timely respond to particular citations issued to it.*fn1

Rockland filed a motion seeking relief from subordination pursuant to G.L. 1956 § 34- 28-16 of the Mechanics' Lien Law and Rule 60(b); a determination of its priority as the first two lien holders; and permission to foreclose under § 34-28-16.1.*fn2 On May 1, 2009, this Court issued a decision denying relief from subordination in the actions brought by Northern Site Contractors, Inc. ("Northern Site," K.M. 2008-1190), Sheridan Electric, Inc. ("Sheridan," K.M. 2008-1248), Roofing Concepts, Inc. ("Roofing Concepts," K.M. 2008-1445), and Rustic Fire Prevention, Inc. ("Rustic," K.M. 2008-1396), to which Rockland did not timely answer.

Rockland's constitutional claims were preserved and bifurcated for later hearing.

Manufacturers and Traders Trust Company ("M&T"), a mortgagee on the Royal Mills property, similarly responded out of time to particular citations issued to it and moved for relief from subordination and for a determination of its priority as the first lien holder on the Royal Mills property. Although M&T's motion is still pending, M&T joined with Rockland to present constitutional arguments to the Court on May 4, 2009.*fn3 Specifically, Rockland and M&T argue that the Superior Court's form Mechanics' Lien Citation violates procedural due process, and that the subordination clause in § 34-28-16 violates substantive due process and equal protection of the laws, as guaranteed by the United States Constitution and the Rhode Island Constitution.

II

Standard of Review

It is well-settled that "[i]n reviewing the constitutionality of statutes, '[t]he Legislature is presumed to have acted within its constitutional power.' " Gem Plumbing & Heating Co., Inc. v. Rossi, 867 A.2d 796, 808 (R.I. 2005) (quoting Burrillville Racing Association v. State, 118 R.I. 154, 157, 372 A.2d 979, 982 (1977)). Furthermore, "[t]his [C]court will attach every reasonable intendment in favor of . . . constitutionality in order to preserve the statute." Id. (quoting Lynch v. King, 120 R.I. 868, 875, 391 A.2d 117, 121 (1978)) (internal quotations omitted).

Importantly, the party challenging the statute bears the high burden of proving "beyond a reasonable doubt that the statute is unconstitutional." Id.

III

...


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