INSTITUTE FOR ESSENTIAL HOUS., INC. V. KEITH, 1966-NMSC-067, 76 N.M. 492, 416 P.2d
157 (S. Ct. 1966)
INSTITUTE FOR ESSENTIAL HOUSING, INC., a
New Jersey
Corporation, Defendant-Cross-Plaintiff and Appellant,
vs.
CLIFFORD G. KEITH and ANNIE M. KEITH, his wife,
Defendants-Cross-Defendants and Appellees
SUPREME COURT OF NEW MEXICO
1966-NMSC-067, 76 N.M. 492, 416 P.2d 157
Appeal from the District Court of
Lincoln County, Zimmerman, Judge
Motion for Rehearing Denied July 18,
1966
BOYCE & FETTINGER, Alamogordo, New
Mexico, Attorneys for Appellant.
FRAZIER, CUSACK & SCHNEDAR, Roswell,
New Mexico, Attorneys for Appellees.
NOBLE, Justice, wrote the opinion.
DAVID W. CARMODY, C.J., DAVID CHAVEZ, JR.,
J.
{1} This action was commenced
as one to foreclose materialmen's liens in connection with the construction of
the Keith home, but by cross-complaint Institute for Essential Housing, Inc.
(hereafter termed I.E.H.) sought foreclosure of a note and mortgage executed by
the Keiths and allegedly given to I.E.H. to finance the house. The material
liens are not now an issue. I.E.H. has appealed from a summary judgment dismissing
its cross-complaint. This appeal, therefore, turns on whether the pleadings,
answers to interrogatories and affidavits present a genuine issue of fact
requiring determination.
{2} It is firmly established
that in considering a motion for summary judgment, the pleadings, depositions
and affidavits must be viewed in the most favorable aspect they will bear in
support of the party opposing the motion. Ginn v. MacAluso,
62 N.M. 375,
310
P.2d 1034; Sooner Pipe & Supply Corp. v. Doerrie,
69 N.M. 78,
364 P.2d 138;
Hubbard v. Mathis,
72 N.M. 270,
383 P.2d 240. And, summary judgment will be
granted only when the moving party is entitled to the judgment as a matter of
law upon clear and undisputed facts. Rules of Civil Procedure, Rule 56(c) (§
21-1-1(56)(c), N.M.S.A. 1953); Srader v. Pecos Construction Company,
71 N.M.
320,
378 P.2d 364; Hubbard v. Mathis, supra.
{3} So considered, we think
that there were genuine issues of fact to be resolved in this case and that
summary judgment was improper. Without attempting to detail all of them, we
merely point out the following
{*494} issues
of fact which have not been resolved. Keith alleges and I.E.H. denies that the
note and mortgage were delivered upon the condition that they would only become
effective upon construction of the Keith home in accordance with certain plans
and specifications. Keith alleges and I.E.H. denies that I.E.H. agreed to
"furnish materials and build a house" for Keith. I.E.H. denies that a
purported construction contract is in fact its agreement or that it was
executed in its behalf by an authorized agent.
{4} The arguments on appeal
make it apparent to us that the trial court may have been influenced in
rendering summary judgment by the contention that I.E.H. built the house
without a contractor's license and, therefore, could not enforce a claim for
collection of compensation for such collection. In the first place, the issue
of whether I.E.H. agreed to construct the Keith house is one of fact to be
determined upon a trial of the issues and, since the question will no doubt be
again before the trial court when the case is heard on its merits, we shall
discuss it. The forfeiture clause (§ 67-16-14, N.M.S.A. 1953) of the
Contractors' License Law reads, so far as pertinent:
"No contractor * * * shall * * * bring or maintain any
action in any court of the state for the collection of compensation for the
performance of any act for which a license is required by this act without
alleging and proving that such contractor was a duly licensed contractor * *
*."
It is plain that since the statute only prohibits an
unlicensed contractor from bringing or maintaining an action "for the
collection of compensation" for construction work, recovery by I.E.H. is
prohibited only if its action on the note and mortgage is one for collection of
compensation for a construction contract. It does not appear that it was such
an action. The action framed by the cross-complaint of I.E.H. is one seeking
judgment on a promissory note and to foreclose a mortgage given as security
therefor. That cross-claim constitutes the action with which we are now
concerned. From its very nature, a promissory note is a separate contract,
Broyles v. Achor, 78 S.W.2d 459 (St. Louis Ct. App. 1935), and an action based
thereon is a separate cause of action. Grue v. Hensley, 357 Mo. 592, 210 S.W.2d
7. Keith's defense claiming that I.E.H., an unlicensed contractor, agreed to
build his house does not make the I.E.H. counterclaim on the note and mortgage
an action prohibited by § 67-16-14, supra.
{5} It follows that the case
must be reversed and the district court instructed to vacate the summary
judgment and to proceed further in a manner not inconsistent with this opinion.
DAVID W. CARMODY, C.J., DAVID CHAVEZ, JR., J.
The motion for rehearing is denied. The following is in
addition to the opinion heretofore filed.
{7} The question of whether
any acts prohibited by the statute affect the consideration or validity of the
obligation sued upon is not before us on this appeal, and we express no opinion
thereon.
DAVID W. CARMODY, C.J., DAVID CHAVEZ, JR., J.