Romak Iron Works v. Prudential Insurance of America

This appeal involves provisions of the Civil Code which establish that a subcontractor on a private construction project who (1) gives a “preliminary 20-day notice” to a “construction lender” financing the project, and who (2) gives a “stop notice” to the lender thereafter, may (3) recover the subcontract price in an action brought against the lender to enforce the stop notice. This appeal is from a summary judgment dismissing such action on the ground that the plaintiff subcontractor had not given the defendant lender a preliminary 20-day notice in time to make it effective for any purpose. The question is whether its timing is fatal to the action in light of other circumstances shown on the motion for summary judgment.

Facts

The record and the briefs support the following recital of facts which are not in dispute; On and before May 24, 1972, record title to certain real property in San Francisco was held by MacDonald, Nelson & Heck, Inc., a corporation (hereinafter MacDonald), Marwin Garage Corporation (Marwin), and one Lucien Sabella. They had negotiated a loan from respondent Prudential Insurance Company of America (Prudential) to finance the construction of a…