Melorich Builders, Inc. v. Superior Court

Petitioner by writ contests the denial of petitioner’s motion for summary judgment as to real parties’ in interest (Serabias’) cause of action for intentional infliction of emotional distress. This cause of action was based on petitioner’s filing an unbonded stop notice during the course of litigation between the parties.

Petitioner contends the Serabias’ claim was barred as a matter of law on two theories: (1) the filing of the stop notice was privileged; and (2) petitioner’s conduct was not outrageous.

Facts

Petitioner, Melorich Builders, Inc. (Melorich), a general contractor, agreed to build a house for the Serabias. Construction was to be financed through Santa Fe Federal Savings and Loan Association (Santa Fe). Disputes over the construction arose between Melorich and the Serabias. The Serabias sued Melorich for breach of contract, and Melorich cross-complained to foreclose a mechanic’s lien.

After this litigation commenced Melorich filed an unbonded stop notice with Santa Fe on March 19, 1979. This was done on advice of counsel. Santa Fe’s attorney acknowledged receipt of the stop notice and advised Melorich’s attorney Santa Fe was not obligated to honor an…