Construction Law - Justia Case Law Summaries

Boldt Company v Black & Veatch Construction, Inc.

2026-07-08T07:30:46-08:00

Black & Veatch Construction, Inc. contracted The Boldt Company as a subcontractor for the assembly of a windfarm in Illinois. The project quickly encountered delays due to late delivery of turbine parts, unsuitable site conditions, and issues with equipment, for which Boldt provided several written notices to Black & Veatch. Despite these notices, Black & Veatch issued multiple default warnings and ultimately terminated Boldt for cause, taking over the remaining work. Boldt sued, claiming wrongful termination and seeking payment for completed work, while Black & Veatch counterclaimed that Boldt breached by failing to perform on time. The United States District Court for the Northern District of Illinois granted summary judgment in favor of Black & Veatch, ruling that Boldt defaulted by failing to perform on schedule and that Black & Veatch properly terminated the subcontract. At trial, the jury was tasked only with determining damages and awarded Black & Veatch nominal damages of $1. Both parties filed post-trial motions, which the district court denied. Upon appeal, the United States Court of Appeals for the Seventh Circuit affirmed the jury’s nominal damages verdict, finding no reversible error in the district court’s evidentiary rulings or jury instructions. The appellate court also affirmed the district court’s grant of summary judgment as to Boldt’s claims for payment for completed work and for Black & Veatch’s alleged failure to provide adequate construction works. However, the Seventh Circuit reversed the grant of summary judgment on the wrongful termination claim, finding the subcontract ambiguous about whether Boldt was responsible for delays absent specific notice and that material factual disputes remained. The case was remanded for further proceedings on the wrongful termination claim. View "Boldt Company v Black & Veatch Construction, Inc." on Justia Law

Reagan Marine Construction, LLC v. Costa

2026-07-07T08:17:35-08:00

A general contractor hired a subcontractor to perform electrical work on a marina expansion project in Bristol, Rhode Island. The subcontract specified that time was critical and required timely written notice of delays, as well as an indemnification clause. After the parties negotiated an expanded scope of work and the general contractor paid a deposit, the subcontractor failed to meet the estimated completion schedule and did not provide required delay notices. As a result, the town threatened to terminate the general contract. The general contractor then terminated the subcontract and hired a replacement. The contractor sued the subcontractor and its CEO in Providence County Superior Court, alleging breach of contract, negligent misrepresentation, fraud, and conversion, and sought damages and attorney’s fees. The defendants answered and asserted affirmative defenses. After repeated failures to comply with discovery orders and to retain new counsel following their attorney’s withdrawal, the Superior Court issued conditional orders of default, giving the defendants multiple opportunities to comply. When they did not, the court entered a default judgment for the contractor, including damages, costs, prejudgment interest, and attorney’s fees. The CEO appeared at some hearings but not others, raising concerns about notice and service, which were addressed by the trial justice, who instructed him to file a Rule 60 motion to vacate the default if he wished to contest notice. No such motion was filed. Both sides subsequently filed motions with the Rhode Island Supreme Court relating to remand and post-judgment relief. The Supreme Court of Rhode Island reviewed whether the trial justice abused discretion in entering the default judgment. It held that the defendants’ failure to file a Rule 60 motion or properly raise notice issues in the lower court precluded appellate review of those issues. The Court found no abuse of discretion in the entry of default and affirmed the Superior Court’s judgment. The imposition of a cash bond as a condition for remand did not violate due process. View "Reagan Marine Construction, LLC v. Costa" on Justia Law

HAMP'S CONSTRUCTION LLC v. SECRETARY OF THE ARMY

2026-06-30T06:32:30-08:00

This case centers on a contractor’s claim for a Type I differing site condition relating to a flood control project in Jefferson Parish, Louisiana. The United States Army Corps of Engineers issued a solicitation for work on the Trapp Canal, which included boring logs and cross-sections of the canal but lacked specific information about the southwest bank. Hamp’s Construction LLC, after being awarded the contract, encountered unexpected bank failures in the southwest quadrant, resulting in unsafe conditions for land-based equipment and significant delays. Hamp’s Construction submitted a request for equitable adjustment and later a formal claim, asserting that the conditions encountered were materially different from those indicated in the contract documents. The contracting officer denied Hamp’s Construction’s request and subsequent claim, concluding there was insufficient proof of a differing site condition under the relevant Federal Acquisition Regulation clause. Hamp’s Construction appealed to the Armed Services Board of Contract Appeals. After a hearing, the Board found that although Hamp’s Construction had faced unforeseen difficulties and increased costs, the contract documents did not provide representations or indications about the subsurface conditions of the southwest bank. The Board emphasized the absence of boring logs or explicit information for the area where the failures occurred and denied the appeal. The United States Court of Appeals for the Federal Circuit reviewed the Board’s legal conclusions de novo and factual findings for substantial evidence. The court held that, for a Type I differing site condition claim, the contract must affirmatively indicate conditions at the disputed site. The court determined that Hamp’s Construction could not reasonably rely on contract documents as indications for the southwest bank. The court affirmed the Board’s decision, holding that Hamp’s Construction failed to establish a threshold element of a Type I differing site condition claim. View "HAMP'S CONSTRUCTION LLC v. SECRETARY OF THE ARMY" on Justia Law

J.C. Cannistraro, LLC v. Columbia Construction Co.

2026-06-29T04:09:06-08:00

A general contractor and a subcontractor entered into agreements for the construction and renovation of a facility. The subcontracts required disputes to be resolved by arbitration pursuant to the rules of the American Arbitration Association. The subcontractor performed work and submitted invoices, but the general contractor, while timely rejecting the invoices and providing reasons, failed to include the good faith certification required by the Massachusetts prompt pay act. The contractor later paid the invoices after an arbitrator determined that the invoices were deemed approved due to the lack of timely certification. Subsequently, the contractor filed a counterclaim in arbitration seeking recoupment of those payments, arguing the invoices were not fair and reasonable. The subcontractor initially brought suit in the Massachusetts Superior Court, which was then compelled to arbitration per the contract. During arbitration, the arbitrator found that the contractor’s failure to timely certify its rejection of the invoices resulted in the invoices being deemed approved and ordered payment to the subcontractor. After payment, the arbitrator allowed the contractor’s counterclaim for recoupment. Following evidentiary proceedings, the arbitrator ruled in favor of the contractor, awarding partial recoupment. The subcontractor moved in the Superior Court to vacate this award, arguing that the arbitrator exceeded his authority. Relying on J.C. Cannistraro, LLC v. Columbia Construction Co., the Superior Court judge vacated the recoupment portion of the arbitration award, finding that the contractor had asserted defenses before paying the invoices, contrary to precedent. The Supreme Judicial Court of Massachusetts reviewed the matter on direct appellate review. It held that the arbitrator did not exceed his authority because the award was not prohibited by law nor did it violate public policy. The court determined that the prompt pay act did not expressly prohibit recoupment in these circumstances and that the arbitrator’s actions were within the broad scope granted by the parties’ agreement and the arbitration rules. The judgment vacating the arbitration award was reversed and the matter remanded for confirmation of the arbitration award. View "J.C. Cannistraro, LLC v. Columbia Construction Co." on Justia Law

JMI CONTRACTORS, LLC v. MEDELLIN

2026-06-26T06:22:17-08:00

Jose Medellin, an experienced independent contractor, was hired to assist with a roofing project at an apartment complex in San Antonio. While working on the roof, Medellin, along with other workers, was responsible for stretching a rubber membrane across the roof’s surface. During this task, Medellin lost track of the roof’s edge, fell approximately thirty feet, and suffered serious injuries. He subsequently sued the general contractor, alleging both negligent activity and premises liability, arguing that the lack of adequate safety measures contributed to his fall. The case proceeded to a jury trial in a Texas district court, where the jury found JMI Contractors, LLC liable under both negligent activity and premises liability theories, awarding Medellin over $3.3 million in compensatory damages and an additional $1 million in exemplary damages. JMI appealed to the Court of Appeals for the Fourth District of Texas, which initially ordered a new trial on unrelated grounds. Upon rehearing, the court of appeals affirmed the trial court’s judgment, holding that the necessary-use exception applied to Medellin’s premises liability claim, and that JMI owed him a duty of care due to its control over jobsite safety. The Supreme Court of Texas granted JMI’s petition for review. The Supreme Court held that Medellin’s claim properly sounded in premises liability, not negligent activity, as his injury arose from a dangerous condition (an unguarded roof edge) rather than contemporaneous conduct by JMI. Crucially, the Court held that independent contractors cannot recover under premises liability for injuries caused by open and obvious dangers and that the necessary-use exception does not apply to them. Accordingly, the Supreme Court of Texas reversed the judgment of the court of appeals and rendered a take-nothing judgment in favor of JMI. View "JMI CONTRACTORS, LLC v. MEDELLIN" on Justia Law

Associated General Contractors of North Dakota v. City of West Fargo

2026-06-25T08:41:49-08:00

A trade association representing licensed contractors sued a municipal government, alleging that the city violated North Dakota’s statutory competitive bidding requirements for certain public improvement projects. The association claimed that the city self-performed various tasks during a road improvement project, despite the project’s estimated cost exceeding the statutory threshold for mandatory public bidding. After the project was substantially completed, the city adopted a new ordinance authorizing it to self-perform routine street maintenance, including milling and overlaying, regardless of cost. The case was heard in the District Court of Cass County, East Central Judicial District. The district court granted leave for the association to supplement its complaint with factual allegations about the completed project, but denied leave to challenge the newly adopted ordinance, concluding the association lacked standing because it had not shown an actual or threatened injury from action under the ordinance. After a hearing, the district court dismissed the case as moot, reasoning that because the road project had been completed, there was no ongoing controversy or relief to be granted. The North Dakota Supreme Court reviewed the appeal. It held that the public interest exception to mootness applied, since litigation regarding competitive bidding statutes has statewide significance and guides the conduct of public officials across North Dakota. The Supreme Court further determined that the association had standing to challenge the city’s ordinance, because it alleged facts showing the ordinance threatened injury to its members—licensed contractors eligible to bid on public projects. The Supreme Court reversed the district court’s dismissal and remanded for further proceedings, instructing reconsideration of whether the association may amend its complaint to challenge the ordinance. View "Associated General Contractors of North Dakota v. City of West Fargo" on Justia Law

Fazel v. Pete Fowler Construction Services

2026-06-23T12:03:09-08:00

After her property experienced water intrusion, a homeowner sued her neighbor, whose property was the source of the problem. The neighbor, in defending the lawsuit, hired a construction consulting firm to inspect both properties and to create an expert report recommending repairs. The recommendations from this report formed the basis of a settlement between the homeowner and her neighbor, and repairs were performed accordingly. After the settlement and repairs, the water intrusion problem recurred, leading the homeowner to file a new lawsuit against the consulting firm, alleging that its recommendations were negligent and defective. In the Superior Court of Orange County, the consulting firm filed an anti-SLAPP motion, asserting that its actions were protected as statements made in the course of litigation. The trial court granted the motion concerning certain claims, but denied it for claims of negligence and breach of contract as a third-party beneficiary, reasoning these arose from conduct rather than protected statements. On appeal, the California Court of Appeal previously affirmed the trial court’s partial denial, finding that the remaining claims were not based on protected activity, and remanded for further proceedings on those claims. Upon remand, the consulting firm moved for judgment on the pleadings, contending that the litigation privilege under California Civil Code section 47(b) barred the remaining claims. The California Court of Appeal, Fourth Appellate District, Division Three, affirmed the trial court’s judgment in favor of the consulting firm. The court held that the litigation privilege applied because the firm’s formulation of repair recommendations was necessarily related to a communicative act (the expert report) prepared in the course of litigation, and thus barred the homeowner’s negligence and third-party beneficiary claims. The judgment in favor of the consulting firm was affirmed. View "Fazel v. Pete Fowler Construction Services" on Justia Law

Construction Services, LLC v. RAM-Robertsdale Subdivision Partners, LLC

2026-06-18T05:30:34-08:00

A Mississippi construction company, operating under the name MCA Construction, Inc., entered into a contract with an Alabama property owner to perform site development work on a residential subdivision in Baldwin County. The contract was executed on February 11, 2021, and at that time, the company held an Alabama general contractor’s license with a “Building Construction” (BC) classification and an unlimited bid limit. Shortly before executing the contract, the city engineer raised questions regarding whether the BC classification was adequate for the planned utility work (such as water and sewer installation) and indicated that an additional “Municipal and Utility” (MU) classification might be required before such work began. MCA sought clarification from the state licensing board and subsequently obtained the MU classification in May 2021, before starting the utility work. The property owner, RAM-Robertsdale Subdivision Partners, LLC, along with related parties, later alleged that MCA had performed defective work and failed to pay subcontractors, and they brought suit in Baldwin Circuit Court. MCA filed counterclaims for breach of contract and fraud, asserting that it had not been fully paid for its work. The RAM parties moved for summary judgment, arguing that the contract was void because MCA was not properly licensed with the MU classification at the time the contract was executed. The Baldwin Circuit Court granted summary judgment for the RAM parties, holding that the contract was void because MCA was not “duly licensed” for all aspects of the work at the time of contracting. MCA appealed. The Supreme Court of Alabama reviewed the statutory and regulatory framework, noting that MCA had a valid BC license, acted in good faith, and obtained the MU classification before performing utility work. The Supreme Court of Alabama held that substantial compliance with the licensing statute was sufficient in these circumstances and that voiding the contract was not warranted. The court reversed the summary judgment and remanded for further proceedings. View "Construction Services, LLC v. RAM-Robertsdale Subdivision Partners, LLC" on Justia Law

MARKHAM v. CAHAVA

2026-06-17T09:05:50-08:00

A developer owned all property in a residential community and petitioned a town to create a public improvement district to finance and construct infrastructure improvements, such as roads and water lines. The district’s board, composed of representatives of the developer, was authorized to levy assessments and issue bonds to fund construction. The developer and the district entered a development agreement requiring the developer to fund the improvements, and the district contracted with a construction company to perform the work. After most of the work was done, a payment dispute arose. The construction company obtained an arbitration award against the district but was not fully paid. The construction company then sued the developer and related entities for unjust enrichment, asserting that the developer received the benefit of infrastructure improvements without paying for them. The Superior Court in Maricopa County granted the developer’s motion to dismiss, concluding that, under Arizona law as interpreted in Wang Electric, Inc. v. Smoke Tree Resort, a plaintiff in an unjust enrichment claim must allege improper conduct by the property owner, and the construction company had not done so. The court also denied the construction company’s request to file an amended complaint. The Arizona Court of Appeals reversed, holding that the improper conduct requirement applied only in landlord-tenant-contractor cases, and allowed the construction company to amend its complaint. The Supreme Court of the State of Arizona reviewed the case to clarify when the improper conduct requirement applies to unjust enrichment claims. The court held that the requirement only applies when the owner is a landlord and the improvements are made at the tenant’s direction. It does not extend to situations where the owner directly arranges for improvements and pays no one for them. The court concluded that the construction company’s allegations were sufficient to state a claim for unjust enrichment against the developer. The court vacated the decision of the court of appeals, reversed the superior court’s dismissal, and remanded for further proceedings. View "MARKHAM v. CAHAVA" on Justia Law

STUDIO E. ARCHITECTURE AND INTERIORS, INC. v. LEHMBERG

2026-05-29T06:17:52-08:00

Emily Lehmberg sued Studio E. Architecture and Interiors, Inc. and other parties over the remodeling of her home. Studio E. moved to dismiss the claims against it, arguing that Lehmberg failed to file a certificate of merit as required by Texas Civil Practice and Remedies Code Section 150.002, which mandates such a certificate for claims against certain professionals. Lehmberg contended that her claims were not based on professional services but rather on alleged dishonesty and fraud. She also argued that Studio E. had waived its right to seek dismissal by waiting more than two years to file its motion. While the case against other defendants remained pending, the trial court denied Studio E.’s motion, and Studio E. filed an interlocutory appeal. The Court of Appeals for the Fourth District of Texas reversed the trial court’s decision, holding that Section 150.002 applied, and that Studio E. had not waived its right to seek dismissal. The appellate court remanded the case to the trial court to determine whether dismissal should be with or without prejudice. The trial court dismissed the original claims against Studio E. without prejudice, but allowed Lehmberg to file an amended petition with a certificate of merit, reasserting her claims. Studio E. moved to dismiss the amended petition, arguing that reassertion was not permitted in the same lawsuit, but the trial court denied the motion. Studio E. appealed again, and the court of appeals affirmed, holding that amending the petition was proper. The Supreme Court of Texas reviewed the case and held that when claims against a defendant are dismissed without prejudice under Section 150.002, and the underlying lawsuit remains pending, the plaintiff may reassert those claims in an amended petition along with a certificate of merit. The Court affirmed the judgment of the court of appeals. View "STUDIO E. ARCHITECTURE AND INTERIORS, INC. v. LEHMBERG" on Justia Law

Mann v Mezuyon, LLC

2026-05-26T07:08:18-08:00

A worker was injured at a Manhattan construction site owned by Mezuyon, LLC during an excavation project managed by Mayrich Construction Corp. The accident occurred when the worker, who was operating a drilling rig that malfunctioned, was struck by the rear of an excavator while attempting repairs with a mechanic. The worker alleged injuries from being knocked to the ground by the excavator. The injured worker brought suit against Mezuyon, LLC, claiming common-law negligence and violations of New York Labor Law §§ 200, 240(1), and 241(6). Initially, the Labor Law § 241(6) claim was based on sections 23-9.4(h)(4) and 23-9.5(c) of the Industrial Code. After Mezuyon moved for summary judgment, the worker cross-moved to add section 23-4.2(k) of the Industrial Code as a further basis for the claim. The Supreme Court allowed the amendment but ultimately dismissed all claims except the Labor Law § 241(6) claim based on section 23-4.2(k). Mezuyon then brought a third-party action against Mayrich. The Supreme Court later granted summary judgment to Mayrich and dismissed the remaining claim. The Appellate Division, First Department, affirmed that dismissal, and the worker was granted leave to appeal to the New York Court of Appeals. The New York Court of Appeals held that section 23-4.2(k) of the Industrial Code is not sufficiently specific to serve as a predicate for vicarious liability under Labor Law § 241(6). The Court reasoned that the regulation does not mandate compliance with concrete specifications but instead states a broad, general prohibition. As such, it cannot give rise to a nondelegable duty. The Court of Appeals affirmed the order of the Appellate Division, with costs. View "Mann v Mezuyon, LLC" on Justia Law

IN RE GREYSTAR DEVELOPMENT & CONSTRUCTION, L.P.

2026-05-22T06:17:13-08:00

A woman was killed when a construction crane collapsed during a storm, striking her apartment building. Her parents, acting individually and on behalf of her estate, brought a negligence and gross negligence lawsuit against several defendants, primarily three related construction and development entities. Following a jury trial, the jury found these entities had engaged in a joint enterprise that caused the woman’s death and awarded over $360 million in compensatory damages, along with $500 million in exemplary damages (which the trial court later reduced under statutory caps). The court entered judgment holding the entities jointly and severally liable for the compensatory damages, with two entities also severally liable for exemplary damages. The defendants, collectively known as the Greystar Entities, filed a single $25 million joint supersedeas bond to suspend execution of the judgment during their appeal. The plaintiffs challenged the sufficiency of this joint bond in the 191st Judicial District Court, Dallas County, arguing that Texas law capped the required bond at $25 million per debtor, not per judgment. The trial court agreed, ruling that each entity needed to post its own $25 million bond and that the joint bond could suspend execution for only one entity unless the defendants designated which one. The Greystar Entities appealed to the Fifth Court of Appeals at Dallas, which affirmed the trial court’s order. The Supreme Court of Texas reviewed the case on a petition for writ of mandamus. The Court held that, under Texas Civil Practice and Remedies Code Section 52.006(b), the $25 million cap on supersedeas bonds applies per judgment debtor, not collectively to all debtors in a single judgment. The Court also held that the trial court abused its discretion by immediately invalidating the joint bond without allowing a reasonable time for compliance. The Supreme Court conditionally granted partial mandamus relief, directing the trial court to provide additional time for each entity to post an individual bond. View "IN RE GREYSTAR DEVELOPMENT & CONSTRUCTION, L.P." on Justia Law

Corotoman, Inc. v. Central West Virginia Regional Airport Authority

2026-05-21T11:15:25-08:00

A regional airport authority undertook a project to remove a hill from land owned by a private property holder. Instead of purchasing the land outright, the parties entered into an agreement allowing the airport authority to remove the hill and, afterwards, to further lower the elevation of the property by overblasting, which would make future development easier for the owner. The airport authority completed the hill removal but failed to perform the overblasting. The landowner then sued for breach of contract, seeking damages for the incomplete work. The United States District Court for the Southern District of West Virginia found that the airport authority had breached the agreement and granted partial summary judgment to the landowner on liability. Both sides submitted expert reports concerning the cost to complete the required overblasting, ultimately agreeing that this cost was over $4 million. However, the district court held that the cost of completion was grossly disproportionate to the value of the property and applied the “gross disproportionality” rule, awarding only nominal damages because it found insufficient evidence of the property’s diminution in value. The landowner appealed, and the United States Court of Appeals for the Fourth Circuit certified to the Supreme Court of Appeals of West Virginia the question of whether, how, and by whom the gross disproportionality rule should be applied in such cases. The Supreme Court of Appeals of West Virginia held that, in breach of construction contract cases, the gross disproportionality rule may be applied to limit damages. The court clarified that gross disproportionality is calculated using the diminution in value approach, measuring the difference in value between the property as is and as it should have been if the contract had been fully performed. The court further held that the breaching party bears the burden of invoking and proving gross disproportionality. If the breaching party fails to meet this burden, the non-breaching party’s proven measure of damages applies. View "Corotoman, Inc. v. Central West Virginia Regional Airport Authority" on Justia Law

PSP NE, LLC v. PWAB

2026-05-19T05:14:18-08:00

A state agency sought a new headquarters and training facility, issuing detailed specifications for its construction. The agency, as a public body, entered into a long-term “build-to-suit” lease with a private developer, who agreed to construct the facility to the agency’s precise needs. The developer financed the project primarily through a bank loan, with rent payments from the agency structured to cover the developer’s debt service, taxes, and insurance. The lease included provisions requiring the agency to pay unamortized construction costs if it terminated the lease early. The developer sought confirmation that the project was not subject to the state’s prevailing wage law, but the Bureau of Labor Law Compliance determined that the lease payments, as public funds, ultimately financed the construction, making the prevailing wage statute applicable. The developer appealed the Bureau’s decision to the Pennsylvania Prevailing Wage Appeals Board, which upheld the Bureau’s position, citing the financial structure and risk allocation indicating public financing. The developer then appealed to the Commonwealth Court of Pennsylvania. The Commonwealth Court reversed, holding that the lease was a bona fide lease rather than a construction contract, finding that the developer bore the financial risk, and that the agency’s payments were for rent and not directly for construction. On further appeal, the Supreme Court of Pennsylvania reviewed whether the lease constituted "public work" under the state’s Prevailing Wage Act. The Court held that risk allocation is only one of several relevant factors in determining whether public funds paid for construction. Applying a totality-of-the-circumstances analysis, the Court found that the structure of the lease, financing terms, and the agency’s obligations demonstrated that public funds did pay for construction. The Court thus concluded the prevailing wage requirements applied to the lease and reversed the Commonwealth Court’s order. View "PSP NE, LLC v. PWAB" on Justia Law

Polinder v. Aecom Energy & Constr., Inc.

2026-04-30T07:13:05-08:00

A worker at the Cherry Point oil refinery in Washington was regularly exposed to asbestos-containing insulation during his employment, which began in 1971. The insulation at issue was chosen, supplied, and installed by a subcontractor as part of the refinery’s original construction in the early 1970s. Decades after his exposure, the worker developed mesothelioma and died from the disease. His estate brought claims against numerous defendants, including the subcontractor, based on alleged asbestos exposure at the refinery. The Whatcom County Superior Court first granted summary judgment for the subcontractor, relying on Maxwell v. Atlantic Richfield Co., which held that Washington’s six-year construction statute of repose barred such claims. However, the court reconsidered and denied summary judgment after the Washington Court of Appeals issued Welch v. Brand Insulations, Inc., which found there were factual questions about whether the subcontractor’s activities were covered by the statute of repose. Due to conflicting appellate decisions, the Supreme Court of Washington granted direct review. The Supreme Court of the State of Washington held that claims against the subcontractor arising from its construction activities—specifically, its installation of asbestos insulation as part of constructing an improvement on real property—are barred by the construction statute of repose. However, the court held that claims based on the subcontractor’s independent role as a product seller or supplier, separate from its construction activities, are not barred by the statute of repose. The court affirmed in part, reversed in part, and remanded the case for further proceedings to determine which claims, if any, survive under theories of product seller or supplier liability. The court declined to address the constitutionality of the statute of repose, as that issue was not timely raised. View "Polinder v. Aecom Energy & Constr., Inc." on Justia Law

Clearfield County v. Transystems Corp.

2026-04-30T05:12:30-08:00

A county entered into a contract in the late 1970s with various firms for the construction of a new jail, which was completed in 1981. Decades later, during a renovation in 2021, a construction defect was discovered: the original roof was not properly attached to the masonry walls. The county paid for repairs and, in 2023, sued the original architect, the general contractor, and the masonry subcontractor for negligence, fraudulent misrepresentation or nondisclosure, and breach of contract. Each defendant raised the statute of repose in 42 Pa.C.S. § 5536 as a defense, arguing the claims were filed more than 12 years after completion of the jail. The Court of Common Pleas of Clearfield County sustained the defendants’ preliminary objections, finding the statute of repose applied because the jail was completed in 1981, and the defendants had performed the qualifying construction services. The court further held that the doctrine of nullum tempus occurrit regi, which sometimes allows government entities to avoid statutes of limitations, did not apply to the statute of repose. The county appealed. The Commonwealth Court affirmed, assuming for argument's sake that nullum tempus could apply to statutes of repose, but concluding the county failed to meet the requirements for invoking the doctrine because constructing the jail was not enforcing an obligation imposed by law. Upon further appeal, the Supreme Court of Pennsylvania held that nullum tempus cannot preclude the application of the Section 5536 statute of repose. The court concluded the statute of repose is a legislative judgment eliminating liability for construction professionals after 12 years, and its purpose cannot be undermined by the common law doctrine of nullum tempus. The Supreme Court affirmed the Commonwealth Court’s order upholding dismissal of the complaint. View "Clearfield County v. Transystems Corp." on Justia Law

AVL Test Systems v. Hensel Phelps Construction

2026-04-28T12:08:31-08:00

The dispute arose from a contract in which a company specializing in vehicle emissions testing equipment agreed to supply and install its products in a facility being constructed by a general contractor for a state agency. After receiving substantial payments, the equipment supplier sought additional compensation through arbitration. The general contractor defended by arguing that the supplier was not properly licensed as required by California’s Contractors State Licensing Law (CSLL), and thus could not recover payment. The supplier then initiated a lawsuit seeking a judicial declaration that it was exempt from the CSLL’s licensing requirements because its equipment did not become a “fixed part of the structure,” referencing an exemption in the law. The Superior Court of Riverside County reviewed cross-motions for summary judgment. The general contractor argued the exemption did not apply because the equipment became permanently affixed to the building, and the supplier had performed work before obtaining a license. The supplier contended its products were portable and not intended to be permanent fixtures, and that it acted as an equipment installer exempt under the law. The superior court granted summary judgment for the general contractor, finding that the evidence showed the equipment did become a fixed part of the structure and thus the supplier needed a contractor’s license. On appeal, the California Court of Appeal, Fourth Appellate District, Division One, found the lower court erred by deciding as a matter of law that the exemption did not apply. The appellate court held that whether the equipment became a fixed part of the structure is a factual question, not one suitable for summary judgment on the record before it. Because there was conflicting evidence—including expert declarations—on this issue, the trial court should have permitted the factual dispute to be resolved by a trier of fact. The appellate court reversed the judgment and remanded the case for further proceedings. View "AVL Test Systems v. Hensel Phelps Construction" on Justia Law

HMB PROFESSIONAL ENGINEERS, INC. V. IVES

2026-04-23T06:07:35-08:00

Two business partners were traveling on Interstate 65 in Kentucky when their rental car hydroplaned during a heavy rainstorm, resulting in a crash that killed one partner and seriously injured the other. The decedent’s widow, on behalf of herself, her children, and her husband’s estate, along with the surviving partner, brought suit against the engineering firms responsible for the design of a highway-widening project completed years earlier. The plaintiffs alleged that the engineers negligently designed the widened highway, causing increased water pooling and a greater risk of hydroplaning in the area where the accident occurred. The Fayette Circuit Court granted summary judgment for the engineers, holding that they were immune from suit as contractors for a governmental entity and that the claims were preempted by federal law because the design complied with required state and federal standards. The Court of Appeals reversed, concluding that contractors do not automatically share the immunity of the state, that government approval of the design did not insulate the engineers from potential liability for negligent design, and that the state negligence and wrongful death claims were not preempted by federal law. The Supreme Court of Kentucky affirmed the Court of Appeals. It held that private engineering firms hired by a state agency are not entitled to the Commonwealth’s sovereign or derivative immunity simply by virtue of their contract. The court also found that summary judgment was inappropriate on the ground of the engineers’ work being “mandated” by the government because there were genuine issues of material fact regarding whether the design was required or whether the engineers exercised independent judgment. Finally, the court held that Kentucky’s negligence and wrongful death claims were not preempted by federal law, as the state claims did not impose standards more stringent than those required by federal regulations. View "HMB PROFESSIONAL ENGINEERS, INC. V. IVES" on Justia Law

Maldonado-Velasquez v. Ron J Peterson Construction

2026-04-16T09:22:01-08:00

A fatal collision occurred when a Volkswagen Jetta, driven by Raul Lopez with Emilio Martinez-Arroyo as a passenger, rear-ended a utility trailer owned by Ron J. Peterson Construction, Inc. (RJP) on a Utah highway. The trailer, which was transporting construction equipment and did not have underride protection, was traveling significantly below the speed limit with its emergency flashers on. Both occupants of the Jetta died instantly after their car slid under the trailer. Yesneiri Maldonado-Velasquez, the decedent’s wife, sued RJP alleging negligence both in operating the vehicle and in using a trailer that lacked safety features that could have mitigated the injuries. In the Third District Court, Summit County, RJP moved for summary judgment, arguing that it had no duty to upgrade the trailer beyond federal safety standards and that the crash was solely caused by Lopez. The district court found a general statutory duty to operate safe equipment but determined that there was no specific duty to alter the trailer, based on federal preemption and application of factors from B.R. ex rel. Jeffs v. West. As a result, the court excluded much of the plaintiff's expert testimony on enhanced injury and trailer design, allowing only claims related to negligent operation. The jury ultimately found RJP not at fault. On direct appeal, the Supreme Court of the State of Utah held that the district court erred by applying the Jeffs factors to narrow an already established broad statutory duty to operate safe vehicles. The Supreme Court clarified that federal regulations set a minimum standard, not a ceiling, and that state law may impose greater obligations unless direct conflict preemption applies. The court also held that the exclusion of expert testimony premised on the erroneous duty ruling was an abuse of discretion. The Supreme Court reversed and remanded for further proceedings consistent with its opinion. View "Maldonado-Velasquez v. Ron J Peterson Construction" on Justia Law

Cuevas Machine v. Calgon Carbon

2026-04-15T15:30:28-08:00

Cuevas Machine Company entered into a subcontract with O’Neal Constructors for fabrication and machining work at a filtration plant owned by Calgon Carbon Corporation in Mississippi. Under the subcontract, Cuevas was to be paid after Calgon paid O’Neal. Despite nonpayment from O’Neal, Cuevas continued its work. In October 2023, Cuevas recorded two construction liens totaling over $1.2 million against Calgon’s property, but the lien documents did not explicitly state the last date labor, services, or materials were supplied—a statutory requirement. Instead, Cuevas attached invoices to the liens, which included dates, but it was unclear whether these dates satisfied the statutory requirement. After Cuevas filed suit to foreclose on the liens in Mississippi state court, Calgon removed the case to the United States District Court for the Southern District of Mississippi and moved to dismiss. The district court granted Calgon’s motion, dismissing Cuevas’s complaint with prejudice under Rule 12(b)(6). The district court concluded, making an Erie guess, that the liens were unenforceable because they did not clearly specify the required “last date” in the manner demanded by Mississippi law, and found that the attached invoices did not sufficiently cure this defect. On appeal, the United States Court of Appeals for the Fifth Circuit reviewed the district court’s decision de novo. Finding Mississippi law ambiguous on whether attachments that do not plainly state the “last date” can satisfy the statutory requirement, the Fifth Circuit certified the following question to the Mississippi Supreme Court: whether attaching invoices that do not explicitly state the “last date labor, services or materials were supplied” satisfies the requirement under Miss. Code Ann. § 85-7-405(1)(b) that a lien “specify the date the claim was due.” The Fifth Circuit did not decide the merits, instead certifying the question for authoritative resolution. View "Cuevas Machine v. Calgon Carbon" on Justia Law

The Lane Construction Corporation v. Skanska USA Civil Southeast, Inc.

2026-04-15T06:01:37-08:00

A group of three major construction firms formed a joint venture to undertake Florida’s largest infrastructure project: the reconstruction and expansion of a major interstate. The venture’s contractual and financial structure was complicated, involving a public-private partnership in which a concessionaire entity financed the project, hired the joint venture to perform the actual construction, and would gain long-term maintenance rights. One member of the joint venture, aware of mounting losses, proposed a strategy for the venture to attempt to exit the project or use the threat of termination as leverage in negotiations. This strategy relied on a contested interpretation of the contract and was opposed by the other members, who considered it dangerously speculative and likely to cause greater harm. As losses increased, the dissenting member stopped contributing required capital to the joint venture, accusing the managing partner of breaching its fiduciary duties by refusing to pursue the proposed termination strategy, and alleging a conflict of interest due to overlapping ownership between the managing partner and the concessionaire. The other members responded by contributing additional funds to keep the project solvent and countersued for breach of contract and indemnity. The United States District Court for the Middle District of Florida held a bench trial and found that the managing partner had not breached any fiduciary duty or acted with gross negligence. The court also found that the dissenting member had materially breached the joint venture agreement by refusing to pay its share of capital calls, and ordered it to reimburse the other members, including prejudgment interest and attorneys’ fees. On appeal, the United States Court of Appeals for the Eleventh Circuit affirmed. The court held that the managing partner had acted in the best interest of the joint venture by not pursuing the proposed termination, and that there was no actionable conflict of interest under Florida partnership law. The court also concluded that the dissenting member’s failure to fund was a material breach, entitling the other members to indemnification and statutory prejudgment interest. View "The Lane Construction Corporation v. Skanska USA Civil Southeast, Inc." on Justia Law

Cordero v. Ghilotti Construction Co., Inc.

2026-04-10T11:32:06-08:00

A worker employed by an independent subcontractor was injured while performing rebar reinforcement work on a pedestrian bridge construction project. The subcontractor had been hired by a construction company serving as the turnkey contractor for the project. The worker fell while climbing rebar, claiming muddy conditions contributed to his injury. Central to the dispute was whether the construction company could be held liable under California law for the worker’s injuries, given the company’s role in preparing the worksite and its ongoing involvement in certain site safety measures. In the Superior Court of San Mateo County, the construction company sought summary judgment, arguing it was not liable under the Privette doctrine, which generally holds that a hirer of an independent contractor is not liable for injuries to the contractor’s employees. The trial court granted summary judgment, finding that the doctrine applied and that the worker had not raised a triable issue of fact showing an exception to the doctrine. The worker argued that the construction company owed him a nondelegable duty under Cal-OSHA regulations and that the company had not actually delegated workplace safety responsibilities to the subcontractor. He also contended that the “retained control” exception to the Privette doctrine applied because the construction company exercised control over site safety in a manner that affirmatively contributed to his injury. The California Court of Appeal, First Appellate District, Division One, affirmed the trial court’s judgment. The court held that the Privette doctrine’s presumption of delegation applied, including to duties imposed by Cal-OSHA regulations, and that there was no evidence the construction company affirmatively contributed to the worker’s injury or interfered with the subcontractor’s means and methods. The court concluded that neither the nondelegable duty argument nor the retained control exception applied, and it affirmed summary judgment in favor of the construction company. View "Cordero v. Ghilotti Construction Co., Inc." on Justia Law

Kono v. D.R. Horton, Inc.

2026-04-10T06:03:44-08:00

An employee of a plumbing subcontractor was injured when a trench collapsed at a residential construction site, resulting in serious physical and emotional harm. The employee had been directed by his supervisor to enter a trench that did not comply with OSHA safety regulations. The general contractor for the project was not present at the site and only learned of the accident months later, after an OSHA investigation. The subcontractor, not the general contractor, was responsible for the trenching work and the day-to-day safety of its employees. After receiving workers’ compensation and settling gross negligence claims against his co-employees, the injured worker proceeded to trial solely on a negligence claim against the general contractor. The Iowa District Court for Polk County denied the general contractor’s motions for directed verdict and judgment notwithstanding the verdict, allowing the case to go to a jury, which found the general contractor liable and awarded substantial compensatory and punitive damages. The Supreme Court of Iowa reviewed the case and reversed the district court’s decision. The court held that, as a general rule, a general contractor does not owe a duty of care to the employees of an independent contractor. The court found that neither the “retained control” nor “peculiar risk” exceptions to this rule applied. The general contractor did not retain operative control over the subcontractor’s work, either by contract or by conduct, and residential trenching work is not inherently or peculiarly dangerous as a matter of law under Iowa precedent. Accordingly, the Supreme Court of Iowa held that the general contractor was entitled to judgment notwithstanding the verdict and reversed the lower court’s ruling. View "Kono v. D.R. Horton, Inc." on Justia Law

Ralph L. Wadsworth Constr. Co. v. Reg'l Rail Partners

2026-04-07T08:34:51-08:00

A public entity contracted with a general contractor to construct a major rail line project. The general contractor, in turn, subcontracted a significant portion of the work to a subcontractor. As the project progressed, it experienced numerous delays and disruptions, which the subcontractor claimed increased its costs. After completing its performance, the subcontractor, relying on expert analysis of its additional costs, filed a verified statement of claim under the Colorado Public Works Act, asserting it was owed additional millions for labor, materials, and other costs, including those stemming from delay and disruption. Following the filing, the general contractor substituted a surety bond for the retained project funds and the subcontractor initiated litigation in Denver District Court. After a bench trial, the trial court found in favor of the subcontractor, concluding that its verified statement of claim was not excessive and that there was a reasonable possibility the claimed amount was due. The court awarded the subcontractor damages for delay, disruption, and unpaid funds. The general contractor appealed, contending the claim was excessive and should result in forfeiture of all rights to the claimed amount. The Colorado Court of Appeals reversed in relevant part, holding that the verified statement of claim was excessive as a matter of law and that the subcontractor forfeited all rights to the amount claimed. This disposition left certain issues raised by the subcontractor on cross-appeal unaddressed. The Supreme Court of Colorado granted review and held that, under the Public Works Act, disputed or unliquidated amounts—including delay and disruption damages—may be included in a verified statement of claim if they represent the specified categories of costs and the claim is not excessive under the statute. The court also held that filing an excessive claim results only in forfeiture of statutory remedies under the Act, not all legal remedies. The Supreme Court reversed the Court of Appeals’ judgment and remanded for further proceedings. View "Ralph L. Wadsworth Constr. Co. v. Reg'l Rail Partners" on Justia Law

Hess v. Pecue

2026-03-20T05:31:15-08:00

The dispute arose after Will Pecue contracted with Gulf Coast Dock Masters/H5K Company, LLC, represented by Ryan Hess, to replace two piers near Pecue's residence. One pier, the "harbor pier," was completed and paid for in full, while the other, the "social pier," was left unfinished after Pecue terminated the contract. Pecue became dissatisfied upon discovering that nontreated lumber was used on the social pier, contrary to contract specifications. Although some boards were replaced, Pecue claimed Hess refused to fix all affected areas and ultimately sent a notice of default. Pecue also asserted that H5K was not a legitimate business entity, which he argued prevented him from obtaining contractual remedies. The Baldwin Circuit Court held a bench trial, during which Pecue pursued only a fraud claim against Hess and H5K, seeking substantial damages. Pecue testified about the alleged misrepresentation of H5K's existence and Hess's refusal to remedy the workmanship issues. The trial court entered judgment in favor of Pecue for $100,000 against Hess and "Ryan Hess D/B/A Gulf Coast Dock Masters." Hess filed a postjudgment motion challenging the sufficiency of the evidence for fraud, but the motion was denied. The Supreme Court of Alabama reviewed the case, applying both the ore tenus and de novo standards of review as appropriate. The court found that the evidence did not support Pecue's claim of fraud. Specifically, there was no misrepresentation of material fact regarding H5K’s existence, and any alleged misrepresentation did not proximately cause Pecue’s damages. Further, there was no evidence of promissory fraud. The Supreme Court of Alabama reversed the trial court’s judgment and remanded the case with instructions to enter judgment in favor of Hess on Pecue’s fraud claim. View "Hess v. Pecue" on Justia Law

John B. Cruz Construction Co. v. Beacon Communities Corp.

2026-03-04T12:30:06-08:00

A black-owned construction company was not invited to bid as general contractor on a major Boston public housing redevelopment project after participating in pre-construction work. Years earlier, the developer had called the company’s president to discuss possible involvement, but the parties disputed what promises, if any, were made during that conversation. The construction company performed pre-construction work and was later selected as general contractor for the first phase (Camden), but after performance and communication issues arose during that project, the developer chose a different, white-owned company for the second phase (Lenox). The construction company did not protest at the time but later sued, alleging breach of contract, quasi-contract, violation of Massachusetts consumer protection law, and racial discrimination under 42 U.S.C. § 1981. The matter was first brought in Massachusetts state court, then removed to the United States District Court for the District of Massachusetts based on federal question jurisdiction. After discovery, the developer moved for summary judgment. The District Court granted summary judgment for the developer, finding no enforceable contract or promise had been made regarding the Lenox phase, that the quasi-contract and Chapter 93A claims failed as derivative, and that there was insufficient evidence of racial discrimination. The United States Court of Appeals for the First Circuit affirmed the District Court’s decision. The First Circuit held that the summary judgment record did not contain evidence from which a reasonable jury could find an enforceable implied-in-fact contract or a promise sufficient for promissory estoppel. It further held that the plaintiff failed to create a triable issue of fact regarding pretext or discriminatory intent under § 1981, given the legitimate business reasons cited for the company’s exclusion. Thus, summary judgment on all claims was proper. View "John B. Cruz Construction Co. v. Beacon Communities Corp." on Justia Law

Eastern Steel v. Int Fidelity Ins. Co.

2026-02-18T07:10:03-08:00

A steel subcontractor was hired to perform work for a university construction project and entered into a subcontract with the general contractor. The general contractor began defaulting on payments, prompting the subcontractor to notify the surety insurance company, which had issued a payment bond guaranteeing payment for labor, materials, and equipment. The surety made partial payment but disputed the remaining amount. The subcontractor then demanded arbitration against the contractor, with the surety notified and invited to participate. The contractor filed for bankruptcy and did not defend in arbitration, nor did the surety participate. The arbitrator awarded the subcontractor damages, including attorneys’ fees and interest, and the award was confirmed in court. The subcontractor sought to enforce the arbitration award against the surety, including attorneys’ fees and prejudgment interest, and also brought a bad faith claim under Pennsylvania’s insurance statute. The Centre County Court of Common Pleas initially excluded evidence of the arbitration award against the surety at trial and ruled the surety was not liable for attorneys’ fees or bad faith damages. A jury found for the subcontractor on the underlying debt, and the court awarded prejudgment interest at the statutory rate. Both parties appealed. The Superior Court held the arbitration award was binding and conclusive against the surety, who had notice and opportunity to participate, and affirmed liability for attorneys’ fees related to pursuing the contractor in arbitration. The court rejected the bad faith claim, holding the statute did not apply to surety bonds, and confirmed the statutory interest rate. On appeal, the Supreme Court of Pennsylvania affirmed in all respects. It held that Pennsylvania’s insurance bad faith statute does not apply to surety bonds, based on statutory language. The court also held that the surety is bound by the arbitration award against its principal, and is liable for attorneys’ fees incurred in arbitration and prejudgment interest at the statutory rate. View "Eastern Steel v. Int Fidelity Ins. Co." on Justia Law

Reidy Contracting Group, LLC v. Mt. Hawley Insurance Company

2026-02-12T08:00:05-08:00

A ceiling collapse at a construction site in New York injured three employees of a subcontractor, Vanquish Contracting Corporation. The general contractor, Reidy Contracting Group, LLC, had required Vanquish to procure insurance coverage that would protect Reidy as an additional insured. Vanquish obtained an excess liability policy from Mt. Hawley Insurance Company, which incorporated the terms of an underlying policy issued by Endurance American Specialty Insurance Company. After the accident, the injured Vanquish employees sued Reidy. Reidy sought defense and indemnification from Mt. Hawley, but Mt. Hawley denied coverage, arguing that Reidy was not an additional insured and that the Employers Liability Exclusion in the policy barred coverage. The United States District Court for the Western District of New York reviewed cross-motions for summary judgment. The district court found that Reidy was an additional insured under the policy and that the Employers Liability Exclusion did not bar coverage. The court reasoned that, based on the policy’s language and the Separation of Insureds clause, “the insured” in the exclusion referred to the party seeking coverage—here, Reidy, which did not employ the injured workers. Alternatively, the court found the exclusion ambiguous and construed it against Mt. Hawley as the drafter. The court also held that Mt. Hawley was precluded from contesting Reidy’s status as an additional insured because it failed to timely raise this argument as required by New York law. On appeal, the United States Court of Appeals for the Second Circuit affirmed the district court’s judgment. The appellate court held that Reidy qualifies as an additional insured and that the Employers Liability Exclusion is ambiguous; thus, the ambiguity must be resolved in favor of coverage for Reidy. The judgment granting summary judgment to Reidy and Merchants Mutual Insurance Company was affirmed. View "Reidy Contracting Group, LLC v. Mt. Hawley Insurance Company" on Justia Law

Atkinson v. Livingston

2026-02-10T16:06:26-08:00

Christopher and Jennifer Atkinson purchased a lot in the Ridgeview Trails Major Subdivision in Livingston, Montana, in 2012. The City of Livingston had approved the subdivision in 2005 and 2006, and a geotechnical report identifying problematic soils was created for the subdivision developers but was not provided to the Atkinsons when they purchased the lot. The Atkinsons received a building permit from the City to construct a residence, which was substantially completed in June 2013. In 2021, the Atkinsons began to observe cracking and structural problems in their home. After later discovering the existence of the geotechnical report, they sued the City in April 2024, alleging negligence and negligent misrepresentation for the City’s failure to disclose known soil issues during the permitting process. The case was heard in the Montana Sixth Judicial District Court, Park County. By agreement, the parties proceeded directly to cross-motions for summary judgment to address threshold legal issues before discovery. The District Court granted summary judgment for the City, holding that the claims were barred by Montana’s statute of repose for construction-related claims, found in § 27-2-208, MCA. The District Court also found that the City owed no duty to the Atkinsons, that the public duty doctrine barred the claims, that the Atkinsons had disclaimed claims relating to permits and inspections, and that the geotechnical report was for the developer’s exclusive use. On appeal, the Supreme Court of the State of Montana affirmed the District Court’s judgment. The Supreme Court held that the Atkinsons’ claims were barred by the ten-year statute of repose in § 27-2-208, MCA, because their claims arose from the City’s planning and inspection activities and were filed more than ten years after substantial completion of the home. The Court also held that the statute applies to municipalities and that no statutory exception applied. View "Atkinson v. Livingston" on Justia Law

Gunwerks, LLC v. Forward Cody Wyoming, Inc.

2026-02-02T08:11:47-08:00

A Wyoming firearms manufacturer sought to expand its operations by constructing a new facility. The company, unable to directly access specific state economic development funds, partnered with a city and a local non-profit to obtain funding, resulting in a written agreement outlining each party’s roles. The non-profit was charged with managing the project, including hiring architects and contractors. During and after construction, the manufacturer identified substantial design and construction defects, including climate control problems, leaks, and structural issues. The manufacturer sued the non-profit for breach of contract and also sued the architect and contractor, asserting it was a third-party beneficiary of their contracts with the non-profit. In the District Court of Park County, the court dismissed the manufacturer’s claims against the architect and contractor, finding it was not an intended third-party beneficiary under their contracts, and granted summary judgment to the non-profit on all but one claim, determining that the non-profit’s contractual obligations were limited to financial administration of the project. The remaining claim was later dismissed by stipulation. The Supreme Court of Wyoming reviewed the case de novo. The court held that the district court erred in dismissing the manufacturer’s claims against the architect and contractor because, accepting the complaint’s factual allegations as true and considering the relevant contracts, the manufacturer had sufficiently alleged facts that could support third-party beneficiary status and breach of contract. The court also found the district court erred in granting summary judgment to the non-profit, concluding that the contract’s language and context imposed broader duties on the non-profit, including project administration and construction oversight, not merely financial management. The Supreme Court of Wyoming reversed the lower court’s orders of dismissal and summary judgment, allowing the manufacturer’s claims to proceed. View "Gunwerks, LLC v. Forward Cody Wyoming, Inc." on Justia Law

Heritage Const. Companies, LLC v. Keithahn

2026-02-02T08:01:14-08:00

The dispute arose from a failed attempt to construct an osteopathic medical school in Gaylord, Minnesota. Philip Keithahn formed Minnesota Medical University, LLC (MMU) and retained Heritage Construction Companies, LLC as the general contractor. MMU planned to finance the project through bond proceeds, with a portion immediately available and the remainder contingent on achieving pre-accreditation. Representatives from Heritage sought confirmation of available funds prior to construction, and Keithahn assured them that the project would be funded and that millions would be available after closing. However, after initial payments, MMU ran out of funds when pre-accreditation was denied, leading Heritage to halt construction and terminate its contract. The United States District Court for the District of Minnesota oversaw the case after Heritage and its affiliates faced indemnification claims and filed a third-party complaint against Keithahn and MMU. The defendants’ motion for summary judgment was denied, and the case proceeded to trial on claims including breach of contract, indemnification, negligent misrepresentation, fraudulent misrepresentation, and fraud by omission. MMU admitted liability for breach of contract and damages. The jury found the defendants liable on all claims except fraudulent misrepresentation. Post-verdict, the district court denied defendants’ motions for judgment as a matter of law or for a new trial, addressing issues of jury instructions, violations of in limine orders, improper statements, and impeachment. The United States Court of Appeals for the Eighth Circuit reviewed the appeal. It held that Keithahn’s representations regarding available financing were actionable as negligent misrepresentations, as they concerned present facts susceptible of knowledge rather than mere future assurances. The court found no error in the jury instructions, no prejudicial violation of evidentiary rulings, and no cumulative error warranting a new trial. The Eighth Circuit affirmed the district court’s judgment. View "Heritage Const. Companies, LLC v. Keithahn" on Justia Law

Sletten Construction of Wyoming, Inc. v. Big Horn Glass, Inc.

2026-01-23T08:14:18-08:00

Gunwerks sought to expand its business by constructing a new manufacturing facility in Cody, Wyoming, a project involving public funds and coordinated through Forward Cody Wyoming, Inc. Forward Cody retained Plan One Architects and Sletten Construction of Wyoming, Inc. as the project's designer and general contractor, respectively. Sletten hired various subcontractors, including Big Horn Glass, Inc. (BHG), to perform specific tasks. After completion, Gunwerks alleged numerous construction defects in the facility, including issues with concrete, finishes, HVAC, siding, drainage, ceiling heights, door and window flashings, and the shooting tunnel. Gunwerks sued Forward Cody, Plan One, and Sletten for breach of contract and breach of the covenant of good faith and fair dealing. Sletten responded to Gunwerks’s lawsuit by filing a third-party complaint against its subcontractors, including BHG. Sletten claimed that, should it be found liable to Gunwerks, subcontractors responsible for any deficient work should indemnify it for those damages. Sletten did not specifically admit or allege deficiencies in BHG’s work but sought to preserve its right to recovery if any subcontractor was found at fault. Approximately ten months after Sletten’s third-party complaint, BHG moved for summary judgment in the District Court of Park County, arguing that Sletten had not presented evidence showing BHG caused any of the alleged damages. The district court granted summary judgment for BHG, finding that Sletten had not countered BHG’s prima facie showing with disputed facts, relying instead on speculation. On appeal, the Supreme Court of Wyoming reviewed the district court’s summary judgment ruling de novo, applying the same standard as the lower court and viewing the record most favorably to Sletten. The Supreme Court affirmed the district court’s decision, holding that Sletten failed to present admissible, competent evidence creating a genuine issue of material fact regarding BHG’s liability for any alleged defects. The court found Sletten’s evidence speculative and conclusory, insufficient to defeat summary judgment. The disposition was affirmed. View "Sletten Construction of Wyoming, Inc. v. Big Horn Glass, Inc." on Justia Law

Perkins v. RMR Building Group

2026-01-23T06:07:31-08:00

A Nebraska limited liability company owned by Michael Perkins hired RMR Building Group, LLC, managed and solely owned by Robert M. Ryan II, as a general contractor to redevelop a shopping center. Their contract used a cost-plus billing arrangement, where Perkins paid RMR in advance for specific construction costs, including a substantial sum for HVAC equipment and RMR’s fee. RMR deposited the funds into its general operating account but did not pay for the HVAC equipment; instead, it used the money to cover other business obligations. Perkins terminated the contract after RMR failed to provide proof of payment for the equipment and then sued RMR and Ryan for breach of contract, unjust enrichment, conversion, and fraudulent misrepresentation, also seeking to pierce the corporate veil and hold Ryan personally liable. The District Court for Douglas County found that RMR breached the contract and was liable under theories of money had and received and unjust enrichment, but not for conversion or fraudulent misrepresentation. The court declined to disregard RMR’s corporate entity, finding no sufficient evidence that Ryan diverted funds for personal use or that RMR was a mere facade for Ryan’s dealings. Perkins appealed these findings. The Nebraska Court of Appeals reversed in part, concluding that the corporate veil should be pierced and Ryan held jointly and severally liable for the misappropriated funds, relying on factors from United States Nat. Bank of Omaha v. Rupe. On further review, the Nebraska Supreme Court reversed the Court of Appeals, holding that the evidence did not establish by a preponderance that RMR’s entity should be disregarded, nor did it support fraud or conversion claims against Ryan. The Supreme Court remanded with direction to affirm the district court’s judgment. View "Perkins v. RMR Building Group" on Justia Law

Ward v. Bishop Construction

2025-12-31T09:04:57-08:00

Joel Ward performed construction work for Bishop Construction, LLC and its sole member, Ren Bishop, in Idaho, Montana, and Wyoming, with an agreed hourly wage and travel compensation. Despite keeping detailed records of his hours, Ward was not paid for work completed between 2017 and 2019, leading him to pursue payment through legal action. The dispute centered on whether Ward should be classified as an employee or an independent contractor and whether he was required to register as a contractor under Idaho law. The case was first heard in the District Court of the Seventh Judicial District of Idaho, Bonneville County. After a bench trial, and based on the parties’ stipulation that Ward was an independent contractor, the court dismissed his wage claims, leaving only breach of contract and unjust enrichment claims. The district court initially awarded Ward full damages for breach of contract. However, after Bishop raised the issue of contractor registration under the Idaho Contractor Registration Act (ICRA) in post-trial motions, the court amended its findings, limited contract damages to out-of-state work, awarded unjust enrichment damages for Idaho work, and granted costs and attorney fees. On appeal, the Supreme Court of the State of Idaho reviewed whether Ward was required to register as a contractor under ICRA and whether the contract was illegal. The Court held that Bishop failed to meet his burden to prove Ward was required to register under ICRA, as the record did not establish Ward’s status as a contractor for those purposes. The Supreme Court vacated the district court’s amended judgment and remanded with instructions to reinstate its original findings and amended judgment, including the previously awarded attorney fees and costs. The Court also awarded Ward attorney fees and costs on appeal as the prevailing party. View "Ward v. Bishop Construction" on Justia Law

Johnson v. Rubylin, Inc.

2025-12-19T11:00:08-08:00

A plaintiff filed a lawsuit against the owner of a restaurant, alleging violations of accessibility laws and seeking damages as well as attorney fees and costs. The defendant requested an early evaluation conference under the Construction-Related Accessibility Standards Compliance Act, which allows certain defendants to obtain a stay of proceedings and mandates that the plaintiff provide a statement disclosing, among other things, the amount of claimed attorney fees and costs. The plaintiff objected to disclosing this information, arguing that it was protected by attorney-client privilege, and did not include it in the required statement. The Superior Court of Santa Clara County ordered the plaintiff to comply with the statutory disclosure and, after the plaintiff’s continued refusal, imposed sanctions. The court offered the plaintiff a choice between a ruling that would bar recovery of attorney fees or dismissal of the case with prejudice; the plaintiff chose dismissal. On appeal, the plaintiff argued that the requested disclosure was privileged and that the trial court’s process violated due process rights. The California Court of Appeal, Sixth Appellate District, reviewed the case. It held that the statutory requirement to disclose claimed attorney fees and costs for the purposes of an early evaluation conference does not violate the attorney-client privilege. The court found that the statutory scheme does not provide for a privilege exception, and that requiring disclosure does not frustrate the legislative purpose of promoting early settlement. The appellate court also found no due process violation in the trial court’s sanction process, noting that the plaintiff had the opportunity to be heard on the privilege issue. Accordingly, the appellate court affirmed the trial court’s order dismissing the plaintiff’s case with prejudice. View "Johnson v. Rubylin, Inc." on Justia Law

Dibrino v Rockefeller Ctr. N., Inc.

2025-12-18T08:23:44-08:00

A carpenter employed by a subcontractor was injured after falling from a ladder owned by another subcontractor, DAL Electrical Corporation, while working on a renovation project at an office building. The injured worker was using his own employer’s equipment in the morning but, after lunch, returned to the worksite without his equipment and used an unattended DAL ladder, which was defective and marked with blue tape. He was injured when the ladder wobbled and he fell, impaling himself on a tool in his belt. The worker brought claims under New York Labor Law and for common-law negligence against the project’s general contractor, premises owner, and DAL, asserting the defective ladder caused his injuries. The general contractor and owner sought indemnification from DAL under their subcontract. The Supreme Court of Bronx County granted the worker’s motion for partial summary judgment on one Labor Law claim and denied DAL’s motion to dismiss other claims and cross-claims by the general contractor and owner. The court also granted the general contractor and owner summary judgment on their contractual indemnification claim against DAL. The Appellate Division, First Department, modified this order by denying summary judgment on contractual indemnification and granting summary judgment for DAL on all claims and cross-claims against it. The general contractor and owner appealed to the New York Court of Appeals. The New York Court of Appeals affirmed the Appellate Division’s decision. The Court held that none of the indemnification provisions in the subcontract required DAL to indemnify the general contractor or owner for the worker’s injuries because the injuries did not arise from DAL’s performance of its contractually defined work. The Court also found that DAL did not owe a duty of care in tort to the injured worker, as the facts did not fit within any recognized exception to the general rule against extending contractual duties to non-contracting third parties. The certified question was answered in the affirmative. View "Dibrino v Rockefeller Ctr. N., Inc." on Justia Law

THIRD COAST SERVICES, LLC v. CASTANEDA

2025-12-12T07:14:56-08:00

Pedro Castaneda died in a traffic accident at an intersection on State Highway 249 that was under construction. At the time, the intersection’s traffic lights were installed but not yet operational, and there was a dispute about whether they were properly covered to indicate their status. Castaneda’s family sued the contractors involved in the project, SpawGlass Civil Construction, Inc. and Third Coast Services, LLC, alleging that negligence in the construction and installation of the traffic signals contributed to the fatal accident. The construction project was governed by an agreement between the Texas Department of Transportation (TxDOT) and Montgomery County, with the County responsible for the project’s design and construction, but with TxDOT retaining authority over the adjacent frontage roads and final approval of plans. The trial court denied the contractors’ motions for summary judgment that sought dismissal under Texas Civil Practice and Remedies Code Section 97.002, which grants immunity to contractors under certain conditions. The contractors appealed. The Fourteenth Court of Appeals affirmed, concluding that Section 97.002 applies only to contractors who are in direct contractual privity with TxDOT, and since neither contractor had a direct contract with TxDOT, they could not invoke the statute’s protection. The Supreme Court of Texas reversed the court of appeals. It held that Section 97.002 does not require direct contractual privity with TxDOT for a contractor to qualify for statutory immunity. The court determined that, based on the summary judgment record, SpawGlass and Third Coast performed work "for" TxDOT within the meaning of the statute, as their activities directly related to frontage roads that TxDOT would own and maintain. The court remanded the case to the court of appeals to determine whether the contractors met the remaining requirements of Section 97.002. View "THIRD COAST SERVICES, LLC v. CASTANEDA" on Justia Law

Ropken v. Yj Construction, Inc.

2025-12-11T08:15:55-08:00

Russ and Debi Ropken hired a construction company to build a custom home based on an oral agreement. The contractor began work and sent invoices for services and materials, which the Ropkens paid until May 2022, after which they stopped making payments. In July 2022, the Ropkens removed the contractor from the site. The contractor then sent a demand letter for three unpaid invoices totaling $276,169, but the Ropkens refused to pay. The contractor sued to recover the unpaid amount. In the District Court of Park County, the Ropkens admitted owing at least $176,870.21. At the conclusion of a jury trial, the jury found there was a valid contract, the Ropkens had breached it, and awarded the contractor $258,587.70 in damages. The district court entered judgment for that amount and permitted the contractor to request prejudgment interest. The contractor timely filed for prejudgment interest, and the Ropkens objected. The district court found for the contractor, awarding $33,473.25 in prejudgment interest at a statutory rate, and calculated interest from the date of the demand letter. The Ropkens paid the judgment but appealed the prejudgment interest award. The Supreme Court of Wyoming reviewed whether the district court erred in awarding prejudgment interest and whether due process was violated by granting interest without an evidentiary hearing. The court held that a district court may award prejudgment interest even when it is not the trier of fact, as prejudgment interest is a matter of law and not fact. The court found the claim was liquidated and the Ropkens had notice. The court also held that the Ropkens received adequate notice and opportunity to be heard, satisfying due process. The Supreme Court of Wyoming affirmed the award of prejudgment interest. View "Ropken v. Yj Construction, Inc." on Justia Law

Bagelmania Holdings, LLC v. RDH Interests, Inc.

2025-12-05T14:04:19-08:00

The case centers on a bakery and deli operator, Bagelmania Holdings, LLC, which leased property from Somerset Property, LLC. Together, they renovated the building for Bagelmania’s restaurant, hiring RDH Interests, Inc. as architect, JEM Associates West, Inc. as contractor, and Turpin & Rattan Engineering, Inc. for HVAC mechanical engineering. Following the renovation, Bagelmania and Somerset alleged construction defects and sued these entities for breach of contract, breach of the implied covenant of good faith and fair dealing, and negligence, with both plaintiffs represented by the same attorney. Prior attempts to initiate litigation were dismissed for failing to comply with Nevada’s NRS 11.258 requirements, which mandate an attorney affidavit of merit and supporting expert reports in nonresidential construction defect cases. The plaintiffs then filed a joint complaint supported by one affidavit and a set of expert reports. The defendants argued that each plaintiff was required to file separate affidavits and expert reports, and the Eighth Judicial District Court, Clark County, agreed, dismissing the case with prejudice for failure to comply with NRS 11.258, also awarding attorney fees, costs, and interest to the defendants. On appeal, the Supreme Court of the State of Nevada considered whether a single affidavit and set of expert reports sufficed under NRS 11.258 when coplaintiffs, represented by the same attorney, jointly brought identical claims arising from the same alleged defects. The Supreme Court held that, under such circumstances, separate affidavits and expert reports are not required. The Court found that the plaintiffs complied with the statute’s plain language and purpose and that the affidavit and reports met the statutory requirements. The Supreme Court reversed the district court’s dismissal, vacated the post-judgment award of fees, costs, and interest, and remanded for further proceedings. View "Bagelmania Holdings, LLC v. RDH Interests, Inc." on Justia Law

Design Gaps, Inc. v. Distinctive Design & Construction LLC

2025-12-05T12:00:15-08:00

A dispute arose from the design and installation of cabinetry in a luxury home in Charleston, South Carolina. Design Gaps, Inc., owned by David and Eva Glover, had a longstanding business relationship with Shelter, LLC, a general contractor operated by Ryan and Jenny Butler. After being dissatisfied with Design Gaps’ performance, the homeowners, Dr. Jason and Kacie Highsmith, and Shelter terminated their contract with Design Gaps and hired Distinctive Design & Construction LLC, owned by Bryan and Wendy Reiss, to complete the work. The Highsmiths and Shelter initiated arbitration against Design Gaps, which led to the arbitrator ruling in favor of the homeowners and Shelter on their claims, and against Design Gaps on its counterclaims, including those for copyright infringement, tortious interference, and unfair trade practices. After the arbitration, Design Gaps sought to vacate the arbitration award in the United States District Court for the District of South Carolina, but the court instead confirmed the award. Concurrently, Design Gaps filed a separate federal lawsuit against several parties, including some who were not part of the arbitration. The defendants moved to dismiss, arguing that res judicata and collateral estoppel barred the new claims, or alternatively, that the claims failed on other grounds such as the statute of limitations and laches. The district court agreed, dismissing most claims based on preclusion or other legal bars, and granted summary judgment on the remaining claims. The United States Court of Appeals for the Fourth Circuit reviewed the district court’s decisions. The court held that res judicata and collateral estoppel applied to bar most of Design Gaps’ claims, even against parties not directly involved in the arbitration but in privity with those who were. For the remaining claims, the court found they were properly dismissed on grounds such as the statute of limitations, waiver, or laches. The Fourth Circuit affirmed the district court’s judgment in full. View "Design Gaps, Inc. v. Distinctive Design & Construction LLC" on Justia Law

Jimenez v. Hayes Apartment Homes

2025-11-26T14:31:16-08:00

Two young children, ages four and two, were severely injured after falling from a second-floor bedroom window in an apartment building in Lodi, California, where they lived with their mother. The accident occurred shortly after the property owner replaced the apartment’s windows during a renovation that did not include installing fall prevention devices on the upper-floor windows. The children’s guardian ad litem sued the property owner and its manager, alleging negligence based on both general negligence and negligence per se, claiming that the absence of fall prevention devices violated the California Building Standards Code and proximately caused the injuries. The case was heard in the Superior Court of California, County of Alameda. Prior to trial, the defendants sought to defeat the negligence per se claim, arguing the building was exempt from current code requirements because it complied with the code at the time of its original construction in 1980. The trial court denied their motion, allowing both negligence theories to proceed to trial. After plaintiffs presented their case, the court granted a nonsuit for the entire complaint, ruling there was no duty owed under general negligence given lack of foreseeability, and that the window replacement qualified for a code exemption, negating negligence per se. On appeal, the Court of Appeal of the State of California, First Appellate District, Division Four, reviewed the matter de novo. The appellate court affirmed the nonsuit on the general negligence claim, finding the harm was not sufficiently foreseeable to impose a duty. However, it reversed the nonsuit as to negligence per se, holding that replacing the window did not qualify for the “original materials” exemption in the Building Code, and thus the defendants were required to comply with current safety standards. The case was remanded for retrial on the negligence per se claim. View "Jimenez v. Hayes Apartment Homes" on Justia Law

RTI, LLC v. Pro Engineering

2025-11-13T08:15:05-08:00

RTI, LLC and RTI Holdings, LLC sought to construct a specialized clinical research facility in Brookings, South Dakota, designed for animal health research trials with stringent air filtration and ventilation requirements. Acting as the general contractor, RTI hired designArc Group, Inc. as architect and several contractors, including Pro Engineering, Inc., Ekern Home Equipment Company, FM Acoustical Tile, Inc., and Trane U.S. Inc., to design and build the facility. After completion in April 2016, RTI experienced significant issues with air pressure, ventilation, and ceiling integrity, leading to contamination problems that disrupted research and resulted in financial losses. The Circuit Court of the Third Judicial Circuit, Brookings County, reviewed RTI’s claims for breach of contract and breach of implied warranties against the architect and contractors. All defendants moved for summary judgment, arguing that RTI’s claims were based on professional negligence and required expert testimony, which RTI failed to provide. The circuit court agreed, finding RTI’s CEO unqualified as an expert, and granted summary judgment to all defendants. The court also denied RTI’s motion to amend its complaint to add negligence claims, deeming the amendment untimely and futile due to the lack of expert testimony. The Supreme Court of the State of South Dakota affirmed the summary judgment for designArc, Pro Engineering, and FM Acoustical, holding that expert testimony was required for claims involving specialized design and construction issues, and that RTI’s CEO was not qualified to provide such testimony. However, the court reversed the summary judgment for Trane and Ekern, finding genuine issues of material fact regarding Trane’s alleged faulty installation and Ekern’s potential vicarious liability. The court also reversed the denial of RTI’s motion to amend the complaint, concluding the proposed amendments were not futile and would not prejudice Trane or Ekern. The case was remanded for further proceedings. View "RTI, LLC v. Pro Engineering" on Justia Law

Yoder v. McCarthy Const.

2025-10-23T05:49:07-08:00

An employee of a roofing subcontractor was severely injured after falling through an uncovered hole while working on a library roof replacement project. The general contractor had contracted with the property owner to perform the roof work and then subcontracted the roofing portion to the injured worker’s employer. The injured worker received workers’ compensation benefits from his direct employer and subsequently filed a negligence lawsuit against the general contractor, seeking damages for his injuries. In the Philadelphia County Court of Common Pleas, the general contractor asserted statutory employer immunity under Pennsylvania’s Workers’ Compensation Act, arguing it was immune from tort liability as a statutory employer. The trial court struck the general contractor’s answer and new matter as untimely and granted the injured worker’s motion to preclude the statutory employer defense at trial. The case proceeded to a jury, which found the general contractor negligent and awarded $5 million to the plaintiff. The trial court denied the general contractor’s post-trial motion for judgment notwithstanding the verdict. On appeal, the Pennsylvania Superior Court vacated the trial court’s judgment and remanded for entry of judgment in favor of the general contractor. The Superior Court held that the general contractor was the injured worker’s statutory employer and thus immune from tort liability, finding all elements of the statutory employer test satisfied and that the defense was not waivable. The Supreme Court of Pennsylvania reviewed whether to overrule prior precedent (Fonner and LeFlar) regarding statutory employer immunity and waiver, and whether the Superior Court properly applied the statutory employer test. The Supreme Court reaffirmed its prior holdings that a general contractor’s statutory employer immunity does not depend on actual payment of workers’ compensation benefits and that the defense is jurisdictional and not waivable. However, it found the Superior Court erred by exceeding its scope of review and remanded the case to the trial court to determine, after appropriate proceedings, whether the general contractor satisfied the disputed elements of the statutory employer test. View "Yoder v. McCarthy Const." on Justia Law

SMG CONSTRUCTION SERVICES, LLC v. COOK

2025-10-15T04:10:15-08:00

Daniel Cook, an independent contractor, was injured when he fell from an exposed, unguarded ledge while installing cabinetry in a second-story bathroom at a residential construction site owned by SMG Construction Services. Cook had previously observed the absence of a guardrail on the ledge and acknowledged this hazard in his deposition. At the time of the accident, he was moving backward toward the ledge while working. Cook sued SMG, alleging that the company failed to maintain a safe premises, which led to his injuries. The Superior Court granted summary judgment to SMG, finding that Cook had actual knowledge of the hazard and failed to exercise ordinary care for his own safety. The court concluded that Cook’s knowledge of the exposed ledge was equal to SMG’s, and therefore, SMG owed him no duty to warn or protect against the risk. On appeal, the Court of Appeals of Georgia reversed, holding that although Cook knew of the ledge, there was evidence that conditions at the site affected his ability to perceive the exact location and risk posed by the ledge. The appellate court found a genuine issue of material fact as to whether Cook’s knowledge of the hazard was equal to or greater than SMG’s. The Supreme Court of Georgia reviewed the case and determined that the Court of Appeals had conflated actual and constructive knowledge, erroneously applying standards relevant to constructive knowledge. The Supreme Court held that Cook’s own testimony established his actual knowledge of the specific hazard—the unguarded ledge—that caused his injury. The Court vacated the judgment of the Court of Appeals and remanded the case for further proceedings to address the remaining elements of SMG’s affirmative defenses in light of Cook’s actual knowledge of the hazard. View "SMG CONSTRUCTION SERVICES, LLC v. COOK" on Justia Law

Chavez-DeRemer v. Miller

2025-09-10T12:00:36-08:00

Elmer Miller, a general contractor and owner of a construction company, was cited by the Occupational Safety and Health Administration (OSHA) for failing to provide fall protection for workers. OSHA sent the citation by certified mail to an address (433 E. County Road, 100 North, Arcola, Illinois) that it had used for Miller in the past. The certified mail was twice refused at that address and returned. OSHA then resent the citation to the same address using UPS, which was marked as received by “Miller.” Miller later argued that the citation was not properly served because it was sent to the wrong address and that there was no proof he received it, claiming his correct address was 435 E. County Road, not 433. After Miller did not contest the citation within the statutory period, the citation became a final order. The Secretary of Labor petitioned the United States Court of Appeals for the Seventh Circuit for summary enforcement of the order. In response, Miller raised the issue of improper service, asserting that the Commission failed to prove adequate service because the citation was not sent to his correct address. The Secretary countered with public records and prior court documents showing Miller and his business had repeatedly used the 433 address for official purposes, including previous OSHA citations and court filings. The United States Court of Appeals for the Seventh Circuit held that OSHA’s service of the citation to the 433 address was reasonably calculated to provide Miller with notice, satisfying due process requirements. The court found that Miller’s history of using the 433 address and his prior acceptance of service there undermined his claim. The court granted the Secretary of Labor’s petition for summary enforcement and issued the enforcement decree pursuant to 29 U.S.C. §660(b). View "Chavez-DeRemer v. Miller" on Justia Law

POINTE 16 v GTIS-HOV

2025-09-04T09:00:27-08:00

A residential community consisting of sixty-seven homes was developed and sold by a developer, with a separate contractor responsible for construction. Each homebuyer entered into a purchase agreement with the developer, which included an anti-assignment clause stating that the agreement and the buyer’s rights under it could not be assigned without the developer’s written consent. The developer later created a homeowners’ association (HOA) to manage the community’s common areas and certain aspects of the homes’ exteriors. After construction, the HOA alleged that the community suffered from construction defects and filed suit against both the developer and the contractor, asserting claims under Arizona’s dwelling action statutes and for breach of the implied warranty of workmanship and habitability. The Superior Court in Maricopa County granted summary judgment for the defendants, holding that the HOA had no legal right to assert a claim for breach of the implied warranty and that the purchase agreement’s anti-assignment clause barred homeowners from assigning such claims to the HOA. The Arizona Court of Appeals affirmed, reasoning that the implied warranty claim was part of the contract and that the anti-assignment clause validly precluded assignment of those claims to the HOA. The Supreme Court of the State of Arizona reviewed the case to determine whether the anti-assignment clause prevented homeowners from assigning their accrued claims for breach of the implied warranty to the HOA. The court held that the anti-assignment clause, which prohibited assignment of the agreement and the buyer’s rights under it, did not prohibit the assignment of accrued claims for damages arising from breach of the implied warranty. The court distinguished between assignment of contract rights and assignment of claims for damages, concluding that the latter was not barred by the agreement’s language. The Supreme Court vacated the relevant portions of the Court of Appeals’ decision, reversed the trial court’s summary judgment on the implied warranty claim, and remanded for further proceedings. View "POINTE 16 v GTIS-HOV" on Justia Law

Nordic PCL Construction, Inc. v. LPIHGC, LLC

2025-09-03T10:33:56-08:00

A dispute arose between two companies, one a contractor and the other a developer, over a construction project in Maui. The disagreement was submitted to binding arbitration, resulting in an award in favor of the developer. The developer sought to confirm the award in the Circuit Court of the First Circuit, but the contractor challenged the award, alleging the arbitrator was evidently partial due to undisclosed relationships. The circuit court initially confirmed the award, but on appeal, the Supreme Court of Hawai‘i remanded the case for an evidentiary hearing on the partiality claim. After the hearing, the circuit court found evident partiality, denied confirmation, vacated the award, and ordered a rehearing before a new arbitrator. Following this, the contractor moved for taxation of costs incurred on appeal, which the circuit court granted. The developer sought to appeal the costs order, but the circuit court denied an interlocutory appeal. A new arbitration was held, again resulting in an award for the developer, which was confirmed in a new special proceeding with a final judgment entered. The developer then appealed the earlier costs order from the first special proceeding. The Intermediate Court of Appeals (ICA) dismissed the appeal as untimely, reasoning that the circuit court’s order vacating the first arbitration award and ordering a rehearing was an appealable final order under Hawai‘i Revised Statutes (HRS) § 658A-28(a)(3), making the subsequent costs order also immediately appealable. The Supreme Court of Hawai‘i reviewed the case and held that an order vacating an arbitration award and directing a rehearing is not an appealable order under HRS § 658A-28(a). The court clarified that such orders lack finality, regardless of whether the rehearing is full or partial, and reaffirmed the majority rule previously adopted in State of Hawaii Organization of Police Officers (SHOPO) v. County of Kauai. The Supreme Court vacated the ICA’s dismissal and remanded the case for entry of a final judgment, so the merits of the appeal could be addressed. View "Nordic PCL Construction, Inc. v. LPIHGC, LLC" on Justia Law

PeakCM, LLC v. Mountainview Metal Systems, LLC

2025-08-22T19:42:00-08:00

A general contractor was hired to oversee the construction of a hotel in Vermont and subcontracted with a firm to install metal siding panels manufactured by a third party. The subcontractor relied on installation instructions available on the manufacturer’s website, which did not specify the use of a splice plate to connect the panels. The panels were installed without splice plates, and after construction, the panels began to detach from the building, causing some to fall and damage nearby property. The contractor later discovered that the manufacturer had created an instruction sheet in 2006 recommending splice plates, but this information was not publicly available at the time of installation. The contractor initially sued the installer for breach of contract, warranty, and negligence in the Vermont Superior Court, Chittenden Unit, Civil Division. The complaint was later amended to add a product liability claim against the manufacturer. After further discovery, the contractor sought to amend the complaint a third time to add new claims against the manufacturer, arguing that new evidence justified the amendment. The trial court denied this motion, citing undue delay and prejudice to the manufacturer, and granted summary judgment to the manufacturer on the product liability claim and on a crossclaim for implied indemnity brought by the installer, finding both barred by the economic-loss rule. On appeal, the Vermont Supreme Court affirmed the trial court’s decisions. The Court held that the trial court did not abuse its discretion in denying the third motion to amend due to undue delay and prejudice. It also held that the economic-loss rule barred the contractor’s product liability claim, as neither the “other-property” nor “special-relationship” exceptions applied. Finally, the Court found the contractor lacked standing to appeal the summary judgment on the installer’s implied indemnity claim. View "PeakCM, LLC v. Mountainview Metal Systems, LLC" on Justia Law

Monarch v. Petra

2025-08-19T14:37:19-08:00

A primary contractor entered into a subcontract with a heating and cooling company to install HVAC systems in an apartment complex. The subcontract included an arbitration clause allowing the contractor, at its sole option, to require arbitration of disputes. Over several years, the relationship between the parties deteriorated, leading the heating and cooling company to file suit for breach of contract and related claims. The contractor failed to respond timely to an amended complaint due to a breakdown in communication with its registered agent, resulting in a default being entered against it. After being properly served, the contractor and the heating and cooling company stipulated to set aside the default, and the contractor then filed an answer and counterclaims. Only after several months did the contractor move to stay proceedings and compel arbitration under the subcontract. The Eighteenth Judicial District Court, Gallatin County, denied the contractor’s motion to compel arbitration. The court found that the contractor had acted inconsistently with its right to arbitrate by failing to assert the arbitration right when reentering the litigation and by not including the arbitration defense in its initial answer. The court also determined that the delay prejudiced the heating and cooling company, which had incurred additional costs and surrendered its default judgment without knowing the contractor would later seek arbitration. The Supreme Court of the State of Montana reviewed the case and affirmed the District Court’s decision. The Supreme Court held that the contractor had waived its right to compel arbitration by acting inconsistently with that right and by causing prejudice to the opposing party. The court found no error in the District Court’s application of the waiver standard and declined to address arguments regarding federal arbitration law, as the waiver was established under Montana law. View "Monarch v. Petra" on Justia Law

Liberty Insurance Corp. v. Hudson Excess Insurance Co.

2025-08-13T06:30:11-08:00

A construction worker employed by a subcontractor was injured when a scaffold collapsed at a Manhattan worksite. The worker sued the property owner and general contractor in New York Supreme Court, alleging negligence and violations of state labor laws. The owner’s insurer, Liberty Insurance Corporation, sought a declaration in federal court that the subcontractor’s insurer, Hudson Excess Insurance Company, was obligated to defend and indemnify the owner as an additional insured under the subcontractor’s commercial general liability policy. The subcontract between the general contractor and the subcontractor required the latter to provide insurance coverage for the owner and general contractor. In the New York Supreme Court, summary judgment was granted to the injured worker on some claims, while other claims remained pending. The court denied summary judgment to the owner on its contractual indemnification claim against the subcontractor, finding factual questions about the scope of the subcontractor’s work. Later, after the federal district court’s decision, the state court dismissed all third-party claims against the subcontractor, finding the indemnity provision in the subcontract invalid due to lack of a meeting of the minds. The United States Court of Appeals for the Second Circuit reviewed the case. It affirmed the district court’s finding, after a bench trial on stipulated facts, that the subcontractor’s actions proximately caused the worker’s injuries and that Hudson owed a duty to indemnify the owner under the policy. The Second Circuit held that the later state court decision did not alter this result. However, the Second Circuit reversed the district court’s award of attorney’s fees to Liberty, holding that Hudson was entitled to a statutory safe harbor under New York Insurance Law, and thus was not required to pay Liberty’s attorney’s fees for the federal action. View "Liberty Insurance Corp. v. Hudson Excess Insurance Co." on Justia Law

In re Receivership of United Prairie Bank v. Molnau Trucking LLC

2025-07-18T06:05:10-08:00

A dispute arose between a surety bond company, Granite Re, Inc. (Granite), and a creditor bank, United Prairie Bank (UPB), over entitlement to funds held by a receiver in a receivership action. Granite issued payment bonds to Molnau Trucking LLC (Molnau) for public works projects, but Molnau defaulted on both the projects and loans from UPB. The issue was whether Granite or UPB had priority to the bonded contract funds held by the receiver. Granite argued for priority under equitable subrogation, having paid laborers and suppliers, while UPB claimed priority under the UCC, having perfected its security interests in Molnau’s accounts receivable before Granite issued the bonds. The district court granted summary judgment in favor of UPB, recognizing Granite’s equitable subrogation rights but ruling that UPB’s perfected security interest had priority. The court of appeals affirmed, applying a “mistake of fact” standard from mortgage context case law, which Granite did not meet. The Minnesota Supreme Court reviewed the case and held that the “mistake of fact” standard does not apply to performing construction sureties. The court concluded that Granite, as a surety, has the right to equitable subrogation without needing to show a mistake of fact. The court further held that a surety’s right to equitable subrogation is not a security interest subject to the UCC’s first-in-time priority rule. Instead, a performing surety has priority over a secured creditor regarding bonded contract funds. The Minnesota Supreme Court reversed the court of appeals’ decision and remanded the case to the district court for entry of judgment in favor of Granite, allowing Granite to request redistribution of the bonded contract funds. View "In re Receivership of United Prairie Bank v. Molnau Trucking LLC" on Justia Law

Jed Spectrum, Inc. v. Stoakes

2025-07-03T07:22:41-08:00

Bighorn Construction, LLC (Bighorn) and JED Spectrum, Inc. (JED) filed mechanic’s liens against property owned by Keith Stoakes, seeking to foreclose on the liens. Stoakes denied the validity of the liens and counterclaimed for slander of title against both companies, and for breach of contract, promissory estoppel, and fraud against JED. After a bench trial, the circuit court denied Bighorn’s and JED’s claims for lien foreclosure and ruled in favor of Stoakes on his slander of title claims, awarding him $252,225.27 in damages and $33,394.20 in attorney fees. The court denied relief on the remaining claims. The circuit court found that Bighorn had no reasonable grounds to file the lien after receiving a check for full payment, and that JED’s lien was untimely and insufficiently itemized. The court also found that Stoakes reasonably relied on JED’s promise of a shared well system, awarding him damages for promissory estoppel. However, the court later reversed its decision on the promissory estoppel claim and reduced the attorney fee award accordingly. The Supreme Court of South Dakota reviewed the case. It reversed the circuit court’s ruling on the slander of title claims, finding insufficient evidence to prove that Jerry, acting on behalf of Bighorn and JED, knew or recklessly disregarded the falsity of the liens. The court affirmed the denial of Stoakes’s promissory estoppel claim, concluding that Stoakes did not suffer substantial economic detriment. The court also affirmed the attorney fee award of $33,394.20 to Stoakes, as it was within the court’s discretion under SDCL 44-9-42. View "Jed Spectrum, Inc. v. Stoakes" on Justia Law

Kratzer Construction v. Hardy Construction

2025-07-01T14:35:26-08:00

Kratzer Construction entered into a subcontract with Hardy Construction Co. to perform work on a building addition for Ekalaka Public Schools. Kratzer completed the work and submitted pay applications, including one for $92,856.45, which Hardy partially disputed due to unapproved change orders. Hardy offered to pay $81,153 upon Kratzer signing a release, but Kratzer refused, demanding the full amount plus interest. Hardy later offered the same amount without requiring a release, but Kratzer still declined, insisting on interest. The Sixteenth Judicial District Court granted summary judgment to Kratzer, ruling that Hardy owed $81,153 plus 18% interest from January 6, 2022, and attorney fees, as Kratzer was deemed the prevailing party. Hardy appealed, arguing that Kratzer failed to meet a condition precedent in the subcontract requiring submission of releases from his subcontractors before final payment. The Supreme Court of Montana reviewed the case and concluded that the subcontract's provisions were clear and unambiguous. The court determined that Kratzer's failure to submit the required releases constituted a breach of the subcontract, and Hardy was entitled to withhold payment. The court found that Hardy's offers to settle did not constitute a waiver of the condition precedent or a novation of the contract. The Supreme Court reversed the District Court's summary judgment in favor of Kratzer, including the awards for interest and attorney fees. The court remanded the case for entry of judgment in favor of Hardy, requiring Hardy to pay Kratzer $81,153 for services rendered under the subcontract, less reasonable attorney fees and costs incurred by Hardy. View "Kratzer Construction v. Hardy Construction" on Justia Law

Palm Springs Promenade, LLC v. Dept. of Industrial Relations

2025-06-13T11:30:48-08:00

A charter city in California entered into an agreement with a private developer to revitalize a nearly vacant mall into a multipurpose development. The city contributed approximately $51.36 million in local funds for public improvements, while the developer invested $143 million of its own funds and obtained additional loans. The developer selected the contractors and paid workers less than the prevailing wage, relying on a city ordinance exempting the project from the Prevailing Wage Law (PWL). The Department of Industrial Relations (DIR) determined that the project was subject to the PWL, as it involved public funds. The developer challenged this determination, but the Superior Court of Riverside County affirmed the DIR's decision, concluding that the project was not a municipal affair exempt from the PWL. The Court of Appeal, Fourth Appellate District, reviewed the case and affirmed the lower court's judgment. The court held that the project was not a municipal affair under the home rule provision of the California Constitution. The court distinguished this case from others where charter cities directly managed and funded public works projects. Here, the developer controlled the construction, selected contractors, and bore the majority of the financial burden. The court concluded that the primary purpose of the project was to benefit the developer, not the city, and thus, the PWL applied. The judgment was affirmed, and the DIR was awarded costs on appeal. View "Palm Springs Promenade, LLC v. Dept. of Industrial Relations" on Justia Law

Johnson v. Albin Carlson & Co.

2025-06-13T09:00:27-08:00

A contractor hired a subcontractor to work on a remote bridge construction project. The scope of the work changed, and neither party kept detailed records of the changes and associated costs. Years after the project was completed, the subcontractor sued for damages, claiming unpaid work. The superior court found that the subcontract did not govern the extra work, awarded some damages to the subcontractor, and precluded some claims due to discovery violations. The court also found the contractor to be the prevailing party and awarded attorney’s fees. Both parties appealed. The superior court denied summary judgment motions from both parties, finding factual disputes. It precluded the subcontractor from pursuing certain damages claims due to insufficient documentation but allowed evidence for contingent findings. After a bench trial, the court awarded the subcontractor $191,443.42, later reduced to $146,693.42 upon reconsideration. The court found the contractor to be the prevailing party under Rule 68 and awarded attorney’s fees. The Supreme Court of Alaska reviewed the case. It concluded that the superior court abused its discretion by precluding the subcontractor’s claims for snowmachine use and labor without considering less severe sanctions. The court affirmed the superior court’s findings on other damages but reversed the awards for Morris Johnson’s labor and boat use, remanding for recalculation. The prevailing party determination and attorney’s fee award were vacated and remanded for reconsideration. The court otherwise affirmed the superior court’s judgment. View "Johnson v. Albin Carlson & Co." on Justia Law

Smith Masonry v. Wipi Group Inc.

2025-06-12T07:42:15-08:00

Tom Smith Masonry (Smith Masonry) and WIPI Group USA, Inc. (WIPI) entered into a contract for Smith Masonry to construct a fence on WIPI’s property. After completing most of the work, Smith Masonry requested final payment, which WIPI withheld due to a dispute over the installation of a gate operator. Smith Masonry filed a mechanic’s lien and subsequently a lawsuit to foreclose on the lien, seeking the unpaid balance. WIPI counterclaimed for breach of contract and other issues, seeking damages for alleged faulty workmanship. The Circuit Court of the Second Judicial Circuit, Lincoln County, South Dakota, denied relief to both parties, finding that Smith Masonry’s work was defective and that WIPI’s damages were not established with exactitude. Smith Masonry appealed, and the South Dakota Supreme Court reversed and remanded, directing the lower court to enter a judgment of foreclosure in favor of Smith Masonry for the full amount of the lien and to reconsider Smith Masonry’s request for attorney fees. On remand, the circuit court entered a judgment in favor of Smith Masonry on the lien but denied the request for attorney fees. Smith Masonry appealed again. The South Dakota Supreme Court found that the circuit court violated the law of the case doctrine by revisiting issues already settled in the first appeal and by speculating on what might have occurred had the trial resumed. The Supreme Court also held that the circuit court abused its discretion by denying attorney fees based on irrelevant factors and an overly narrow interpretation of the statute governing attorney fees in mechanic’s lien cases. The South Dakota Supreme Court reversed the circuit court’s denial of attorney fees and remanded for a determination of an appropriate award of attorney fees consistent with its opinion. The court also awarded Smith Masonry $30,000 for appellate attorney fees. View "Smith Masonry v. Wipi Group Inc." on Justia Law

Edgerock Development, LLC v. C.H. Garmong & Son Inc

2025-06-03T10:34:05-08:00

EdgeRock Development, LLC developed a planned unit development in Westfield, Indiana, comprising retail and residential projects. EdgeRock contracted with C.H. Garmong & Son, Inc. and Fox Contractors Corp. to develop the lots. When EdgeRock fell behind on payments, Garmong and Fox recorded construction liens on all five lots, including those sold to ZPS Westfield, LLC and a nonparty. The contractors sued EdgeRock for breach of contract and sought to foreclose the liens. The Hamilton Superior Court awarded the contractors most of the relief they sought, including foreclosure of the construction liens. The Indiana Court of Appeals reversed the foreclosure, concluding the liens were overstated as they were not limited to debts for improvements directly benefiting the properties to which the liens attached. The Indiana Supreme Court reviewed the case to address the validity and scope of the construction liens and the priority between the construction liens and First Bank Richmond’s mortgage lien. The court held that a construction lien secures only the debt for improvements directly benefiting the property to which the lien attaches. Therefore, the contractors can foreclose the liens on each property to recover only those amounts. The court also concluded that First Bank’s mortgage lien is senior to the construction liens for the amount loaned to satisfy Garmong’s prior construction lien but junior for the remaining amounts. The court affirmed the trial court’s judgment in part, reversed in part, and remanded for the trial court to amend the judgment consistent with its opinion. The court also noted that its holdings do not disturb the in personam judgments against EdgeRock on Garmong’s and Fox’s breach-of-contract claims. View "Edgerock Development, LLC v. C.H. Garmong & Son Inc" on Justia Law

Cashman Equipment Corporation, Inc. v. Cardi Corporation, Inc.

2025-06-03T08:10:55-08:00

Cashman Equipment Corporation, Inc. (Cashman) was contracted by Cardi Corporation, Inc. (Cardi) to construct marine cofferdams for the Sakonnet River Bridge project. Cashman then subcontracted Specialty Diving Services, Inc. (SDS) to perform underwater aspects of the cofferdam installation. Cardi identified deficiencies in the cofferdams and sought to hold Cashman responsible. Cashman believed it had fulfilled its contractual obligations and sued Cardi for breach of contract, unjust enrichment, and quantum meruit. Cardi counterclaimed, alleging deficiencies in Cashman's construction. Cashman later added SDS as a defendant, claiming breach of contract and seeking indemnity and contribution. The Superior Court denied SDS's motion for summary judgment, finding genuine disputes of material fact. The case proceeded to a jury-waived trial, after which SDS moved for judgment as a matter of law. The trial justice granted SDS's motion, finding Cashman failed to establish that SDS breached any obligations. SDS then moved for attorneys' fees, which the trial justice granted, finding Cashman's claims were unsupported by evidence and lacked justiciable issues of fact or law. The trial justice ordered mediation over attorneys' fees, resulting in a stipulated amount of $224,671.14, excluding prejudgment interest. The Rhode Island Supreme Court reviewed the case and affirmed the Superior Court's amended judgment. The Supreme Court held that the trial justice did not err in granting judgment as a matter of law, as Cashman failed to provide specific evidence of justiciable issues of fact. The Court also upheld the award of attorneys' fees, finding no abuse of discretion. Additionally, the Court determined that the attorneys' fees were not barred by the Bankruptcy Code, as they arose post-confirmation and were not contingent claims. View "Cashman Equipment Corporation, Inc. v. Cardi Corporation, Inc." on Justia Law

Flintco, LLC v Total Installation Management Specialists, Inc.

2025-05-28T13:36:56-08:00

A contractor, Flintco, LLC, entered into a subcontract with Total Installation Management Specialists, Inc. (Total) for flooring work on a construction project at Oklahoma State University. Total was required to secure a performance bond from Oklahoma Surety Company (OSC). Flintco later supplemented Total's workforce due to delays and performance issues but did not notify OSC until five weeks after taking over the work. The Tulsa County District Court ruled in favor of Flintco, awarding damages against Total and OSC. OSC appealed, arguing that Flintco failed to meet the performance bond's conditions requiring a declaration of default and reasonable notice before assuming control of the work. The Court of Civil Appeals reversed the district court's judgment, finding that the notice requirement was a mandatory condition precedent, and Flintco's failure to provide timely notice relieved OSC of liability. The Supreme Court of the State of Oklahoma reviewed the case and agreed with the Court of Civil Appeals. The court held that the performance bond's notice requirement constituted a mandatory condition precedent. Flintco's failure to provide timely notice to OSC so it could exercise its performance options under the bond relieved OSC from liability. The court vacated the Court of Civil Appeals' opinion, reversed the district court's judgment, and remanded the case with instructions to enter judgment consistent with this decision. The trial court's judgments against Total were not affected by this decision. View "Flintco, LLC v Total Installation Management Specialists, Inc." on Justia Law

New Star General Contractors, Inc. v. Dumar

2025-05-22T08:43:54-08:00

New Star General Contractors, Inc. (New Star) filed a lawsuit to enforce its construction lien on twelve condo units in a large development in Grand County after the developer, Sage Creek at Moab, LLC (Sage Creek), failed to pay for New Star’s construction work. The units’ owners, Dumar, LLC, and Duane Shaw (collectively, Dumar), challenged the lien on multiple grounds. The district court ruled in favor of New Star, allowing it to enforce its lien. Dumar appealed the decision. The Seventh District Court, Grand County, initially heard the case and ruled that New Star could enforce its lien. The court found that New Star’s preliminary notices were sufficient and that the lien was valid despite New Star’s failure to allocate expenses between the units and the common areas. The court also concluded that Dumar was responsible for the full amount of the lien, which included the costs of constructing Building C and its common areas. Dumar’s excessive lien claim was dismissed, and the court awarded attorney fees to New Star. The Supreme Court of the State of Utah reviewed the case. The court held that New Star’s second preliminary notices, which were specific to Building C, substantially complied with the Construction Lien Statute despite not listing the correct parcel numbers. The court declined to analyze the first preliminary notices. The court also held that New Star’s failure to allocate expenses between the units and the common areas did not invalidate the lien. However, the court found that the district court erred in calculating the amount owed under the lien by treating Dumar as owning all the common areas of Building C, rather than only its ownership share in the development. The court remanded the case for the district court to determine the correct amount Dumar owes based on its ownership share. Additionally, the Supreme Court vacated the district court’s order dismissing Dumar’s excessive lien claim and the attorney fee award for New Star. The court directed the district court to reconsider both issues on remand. View "New Star General Contractors, Inc. v. Dumar" on Justia Law

Arellano v. Sunrise Homes, Inc.

2025-05-19T06:34:31-08:00

Saul Arellano, a roofer, was injured while working on a construction project for Sunrise Homes, Inc. He fell from a roof without fall protection equipment and sustained multiple injuries. Arellano received worker’s compensation benefits through Sunrise Homes after it was discovered that his direct employer did not carry worker’s compensation insurance. Subsequently, Arellano filed negligence and negligence per se claims against Sunrise Homes, arguing that his injuries fell under the “unprovoked physical aggression” exception to Idaho’s worker’s compensation exclusive remedy rule. The District Court of the Seventh Judicial District, Madison County, granted summary judgment in favor of Sunrise Homes. The court concluded that Arellano failed to provide clear and convincing evidence that his claims fell within the statutory exception to the exclusive remedy rule. Specifically, the court found no genuine issues of material fact that Sunrise Homes knew injury or death was substantially likely to occur due to the lack of fall protection equipment. The Supreme Court of the State of Idaho reviewed the case and affirmed the district court’s decision. The Supreme Court held that the district court erred in applying the “clear and convincing” evidentiary standard at the summary judgment stage. However, upon de novo review, the Supreme Court found that Arellano did not raise a genuine issue of material fact regarding Sunrise Homes’ knowledge that injury was substantially likely to occur. The court also rejected Arellano’s arguments that the 2020 amendments to Idaho Code section 72-209(3) codified a more lenient standard or reduced the burden of proof for plaintiffs. Consequently, the Supreme Court affirmed the district court’s order granting summary judgment to Sunrise Homes and awarded costs on appeal to Sunrise Homes. View "Arellano v. Sunrise Homes, Inc." on Justia Law

Grosvold v. Neely

2025-05-13T14:37:26-08:00

Neely, acting as his own general contractor, hired Grosvold to perform excavation work on his property under an oral contract. Grosvold worked from April to October 2021, but their relationship deteriorated, and Neely refused to pay for an invoice amounting to $55,858. Neely sent Grosvold a notice of alleged defects in the work, which Grosvold disputed. Grosvold then filed a complaint for breach of contract and prejudgment interest, while Neely counterclaimed for breach of contract, negligence, and construction defect. The District Court of the Third Judicial District in Anaconda-Deer Lodge County tried the case before a jury. The court refused to instruct the jury on Neely’s construction defect and negligence claims, reasoning that the evidence did not substantiate the work was done to a residence and that the case was strictly a breach of contract matter. The jury found Neely had breached the contract and awarded Grosvold $60,512.60 in damages. The court denied Grosvold’s request for prejudgment interest, finding the damages were not certain until the jury’s determination. The Supreme Court of the State of Montana reviewed the case. It affirmed the District Court’s decision not to instruct the jury on the construction defect claim, holding that the residential construction defect statute did not create an independent cause of action beyond breach of contract or tort. The court also affirmed the refusal to instruct the jury on negligence, finding that Neely’s substantial rights were not affected as the breach of contract instructions adequately covered the disputed subject matter. Finally, the court upheld the denial of prejudgment interest, concluding the amount of recovery was not capable of being made certain until the jury’s verdict. View "Grosvold v. Neely" on Justia Law

PNC Bank v. 2013 Travis Oak Creek

2025-05-05T15:30:14-08:00

The case involves a dispute arising from alleged breaches of a partnership agreement between PNC Bank, N.A., Columbia Housing SLP Corporation (collectively, the "PNC Parties"), and Rene O. Campos, along with 2013 Travis Creek GP, LLC, as general partner. The partnership was formed to acquire, construct, develop, and operate an affordable housing apartment complex in Austin, Texas, with anticipated federal tax credits. A mechanic’s lien was placed on the property, leading to a default on the construction loan. The PNC Parties sought to remove the general partner and replace it with Columbia, resulting in a lawsuit. The PNC Parties filed the lawsuit in the United States District Court for the Western District of Texas, invoking diversity jurisdiction. The district court retained supplemental jurisdiction over the enforcement of the settlement agreement that resolved the 2017 lawsuit. In 2021, the Eureka Parties moved to re-open the case to enforce the settlement agreement, leading to competing motions to enforce. The district court severed the motions from the original lawsuit, creating a new case, and granted each motion in part, offsetting the balance owed. The Eureka Parties and the Partnership appealed. The United States Court of Appeals for the Fifth Circuit reviewed the case and found that the parties failed to establish an independent jurisdictional basis for the severed motions. The court noted that severed claims must have an independent jurisdictional basis and that the record lacked sufficient evidence to establish diversity of citizenship. Consequently, the court remanded the case to the district court for the limited purpose of determining whether such jurisdiction exists. The panel retained jurisdiction over the limited remand. View "PNC Bank v. 2013 Travis Oak Creek" on Justia Law

Palmetto Pointe v. Tri-County Roofing

2025-04-30T06:09:46-08:00

In 2005, Island Pointe, LLC contracted Complete Building Corporation (CBC) to construct a condominium project, Palmetto Pointe at Peas Island. CBC subcontracted Tri-County Roofing (TCR) for roofing and related work. In 2014-2015, Palmetto discovered construction defects and sued CBC, TCR, and others for negligence and breach of warranty. Palmetto received $6,800,000 in settlements, including $1,000,000 from CBC's insurer for a covenant-not-to-execute and $1,975,000 from four other defendants. The trial began in May 2019, and the jury found CBC and TCR liable for $6,500,000 in actual damages and $500,000 each in punitive damages. The trial court apportioned 5% liability to two other defendants, making CBC and TCR jointly and severally liable for the remaining 90% of actual damages. TCR sought setoff for the $1,000,000 payment and the settlements from the four other defendants. The trial court denied TCR's motion for setoff, except for partial amounts conceded by Palmetto. The South Carolina Supreme Court reviewed the case. It reversed the court of appeals' decision, holding that TCR is entitled to set off the full $1,000,000 paid by CBC's insurer. The court affirmed the lower court's decision regarding the settlements from Novus, Atlantic, H and A, and Cohen's, agreeing that the trial court reasonably allocated the settlement amounts. The case was remanded to the trial court for the calculation of the judgment against TCR. View "Palmetto Pointe v. Tri-County Roofing" on Justia Law

Mid-Century Ins. Co. v. HIVE Construction

2025-04-23T01:17:42-08:00

HIVE Construction, Inc. served as the general contractor for the construction of Masterpiece Kitchen, a restaurant. The contract required HIVE to follow specific architectural plans, including installing two layers of drywall on a wall separating the kitchen and dining area. Instead, HIVE installed one layer of drywall and one layer of combustible plywood without approval. A fire started within the wall, causing significant damage and forcing the restaurant to close. Mid-Century Insurance Company, as the property insurer and subrogee of Masterpiece Kitchen, paid for the damages and then sued HIVE for negligence, alleging willful and wanton conduct. The district court initially allowed Mid-Century to amend its complaint to include a breach of contract claim but later reversed this decision, requiring Mid-Century to proceed with the negligence claim. At trial, the jury found HIVE's conduct to be willful and wanton, awarding damages to Mid-Century. HIVE appealed, arguing that the economic loss rule barred the negligence claim. The Colorado Court of Appeals agreed, reversing the district court's decision and instructing a verdict in HIVE's favor. The Supreme Court of Colorado reviewed the case and concluded that the economic loss rule does not provide an exception for willful and wanton conduct. The court held that the rule barred Mid-Century's negligence claim because the duty HIVE allegedly breached was not independent of its contractual obligations. Consequently, the court affirmed the judgment of the Colorado Court of Appeals, upholding the application of the economic loss rule to bar the negligence claim. View "Mid-Century Ins. Co. v. HIVE Construction" on Justia Law

Phoenix Insurance Co. v. Wehr Constructors, Inc.

2025-04-18T12:00:18-08:00

Wehr Constructors, Inc. (Wehr) entered into a contract with St. Claire Medical Center (St. Claire) to build an addition to the hospital. Wehr's performance was allegedly deficient, leading to significant construction defects. St. Claire terminated the contract and sought damages from Wehr's performance-bond carrier, Travelers Casualty and Surety Company (Travelers Surety). Travelers Surety then involved Wehr in the litigation. Wehr sought defense coverage from its insurers: Phoenix Insurance Company (Phoenix), St. Paul Surplus Lines Insurance Company (St. Paul), and Travelers Property Casualty Company of America (Travelers Property). The United States District Court for the Eastern District of Kentucky ruled that none of Wehr’s insurers had a duty to defend Wehr in the lawsuit initiated by St. Claire. The court held that Phoenix’s duty to defend was not triggered because St. Claire did not assert claims directly against Wehr. It also found that St. Paul had no duty to defend because Wehr did not specifically agree to perform as a construction manager, a requirement under the St. Paul policy. Although Wehr did not seek summary judgment against Travelers Property, the court noted that Travelers Property also had no duty to defend for the same reasons as Phoenix. The United States Court of Appeals for the Sixth Circuit reviewed the case. The court affirmed the district court’s decision regarding St. Paul, agreeing that Wehr did not specifically agree to serve as a construction manager. However, it reversed the decision regarding Phoenix, holding that Phoenix had a duty to defend Wehr because the damages alleged by St. Claire potentially fell within the policy coverage, and Wehr was a party to the suit. The court vacated the decision regarding Travelers Property and remanded for further proceedings to determine whether Travelers Property had a duty to defend, given the ambiguity in the district court’s ruling and the stipulation by the parties. View "Phoenix Insurance Co. v. Wehr Constructors, Inc." on Justia Law

Twigg v. Admiral Ins. Co.

2025-04-17T07:38:23-08:00

In this case, the plaintiffs, Weston and Carrie Twigg, hired Rainier Pacific Development LLC to build a home. After taking possession, they discovered various construction defects, including issues with the garage floor. Rainier Pacific agreed to make repairs, but failed to meet deadlines, leading to arbitration. The parties settled through a "Repair Agreement," but Rainier Pacific's subsequent repairs were also defective, prompting the Twiggs to reinitiate arbitration. The arbitrator found Rainier Pacific's work defective and awarded the Twiggs $150,000 for the garage floor repairs. The Multnomah County Circuit Court granted summary judgment to Admiral Insurance Company, Rainier Pacific's insurer, concluding that the damages did not arise from an "accident" as required by the commercial general liability (CGL) policy. The court relied on the precedent set by Oak Crest Construction Co. v. Austin Mutual Insurance Co., which held that damages solely from a breach of contract do not qualify as an "accident." The Oregon Court of Appeals affirmed the trial court's decision, agreeing that the damages arose solely from a breach of contract and not from an "accident" as defined by the CGL policy. The court emphasized that the Twiggs had not contended that Rainier Pacific's liability arose from a separate duty of care, i.e., a tort. The Oregon Supreme Court reversed the Court of Appeals and the trial court's decisions. The Supreme Court held that whether an insurance claim seeks recovery for an "accident" does not depend on the plaintiff's pleading decisions but on whether there is a factual basis for imposing tort liability. The court found that there were material factual disputes regarding whether Rainier Pacific's defective work constituted an "accident" under the CGL policy. Therefore, the case was remanded to the circuit court for further proceedings. View "Twigg v. Admiral Ins. Co." on Justia Law

Trustees of Boston University v. Clough, Harbour & Associates LLP

2025-04-17T04:11:29-08:00

The defendant, Clough, Harbour & Associates LLP (CHA), agreed to design a new athletic field for the plaintiff, Trustees of Boston University (university). The contract included an express indemnification provision, which required CHA to indemnify the university for any expenses resulting from CHA's negligent design. A defect in CHA's design caused the university to incur expenses to fix the field. The university demanded indemnification from CHA, which CHA refused. More than six years after the field opened, the university sued CHA for breach of the indemnification provision. The Superior Court judge granted summary judgment in favor of CHA, relying on the tort statute of repose, which bars tort actions for damages arising from design defects in real property improvements six years after the improvement's opening. The judge concluded that the university's claim was barred by this statute. The university appealed the decision. The Supreme Judicial Court of Massachusetts reviewed the case. The court held that the tort statute of repose does not apply to the university's contract claim for indemnification. The court emphasized that the claim was based on an express contractual provision, not a tort duty imposed by law. The court distinguished between claims for breach of an implied warranty, which are barred by the statute of repose, and claims for breach of an express warranty or indemnification provision, which are not. The court reversed the Superior Court's decision and remanded the case for further proceedings. View "Trustees of Boston University v. Clough, Harbour & Associates LLP" on Justia Law

Golden State Boring & Pipe Jacking, Inc. v. Astaldi Construction

2025-04-16T13:15:59-08:00

The Orange County Transportation Authority (OCTA) awarded a contract to OC 405 Partners Joint Venture (OC 405) for improvements to Interstate 405. OC 405 then awarded subcontracting work to Golden State Boring & Pipe Jacking, Inc. (GSB). However, the parties disagreed on the scope of the subcontract work and did not execute a written subcontract. OC 405 subsequently contracted with another subcontractor, leading GSB to file a lawsuit seeking benefit of the bargain damages, claiming OC 405 did not comply with Public Contract Code section 4107’s substitution procedures. The Superior Court of Orange County granted summary judgment in favor of OC 405 and other defendants, holding that GSB was not entitled to the protections of section 4107 because it did not meet the requirements of section 4100 et seq. Specifically, GSB was not a "listed subcontractor" in the original bid, and its proposed work did not exceed one-half of 1 percent of the prime contractor’s total bid, a threshold requirement under section 4104. The California Court of Appeal, Fourth Appellate District, Division Three, reviewed the case. The court affirmed the lower court’s decision, concluding that section 4107’s substitution procedures did not apply to OC 405’s substitution of GSB. The court emphasized that the protections of section 4100 et seq. only apply to subcontractors whose proposed work exceeds the one-half of 1 percent threshold of the prime contractor’s total bid. Since GSB’s bid did not meet this threshold, it was not entitled to the protections under section 4107. The court also noted that the contractual provisions in the prime contract did not alter this statutory requirement. Thus, the judgment in favor of the defendants was affirmed. View "Golden State Boring & Pipe Jacking, Inc. v. Astaldi Construction" on Justia Law

Oregon-Columbia Chapter Associated General Contractors of America v. Department of Transportation

2025-04-10T07:31:41-08:00

The case involves a petition for a writ of mandamus filed by the Oregon State Building and Construction Trades Council (OBTC) against a preliminary injunction issued by the Marion County Circuit Court. The injunction was part of a public contracting dispute between the Oregon-Columbia Chapter of the Associated General Contractors of America (AGC) and the Oregon Department of Transportation (ODOT). AGC challenged the process used by ODOT to set the terms of "community benefit contracts" for certain highway improvement projects under ORS 279C.308. The Marion County Circuit Court issued a preliminary injunction preventing ODOT from using the terms of a Community Workforce Agreement (CWA) in any projects while AGC's challenge to the validity of the CWA under the Administrative Procedures Act (APA) was pending before the Oregon Court of Appeals. AGC had filed three cases: one in the circuit court and two petitions for judicial review in the Court of Appeals. The circuit court case sought declaratory relief and an injunction against ODOT's use of the CWA. The Court of Appeals certified the case challenging the CWA's validity to the Oregon Supreme Court, which accepted the certification. The Oregon Supreme Court reviewed the case and decided the challenge to the validity of the CWA in a related case, Oregon-Columbia Chapter of AGC v. ODOT. As a result, the preliminary injunction issued by the circuit court expired, rendering OBTC's request for mandamus relief moot. Consequently, the Oregon Supreme Court dismissed the petition for a writ of mandamus. View "Oregon-Columbia Chapter Associated General Contractors of America v. Department of Transportation" on Justia Law

E&I Global Energy Services v. Liberty Mutual Insurance Co.

2025-04-04T07:30:23-08:00

Plaintiffs, E&I Global Energy Services, Inc. and E&C Global, LLC, sued Liberty Mutual Insurance Company for breach of contract and tort claims related to a construction project. The United States, through the Western Area Power Administration (WAPA), contracted with Isolux to build a substation, and Liberty issued performance and payment bonds for Isolux. After Isolux was terminated, Liberty hired E&C as the completion contractor, but E&I performed the work. Plaintiffs claimed Liberty failed to pay for the work completed. The United States District Court for the District of South Dakota granted summary judgment for Liberty on the unjust enrichment claim and ruled in Liberty's favor on all other claims after a bench trial. The court denied Plaintiffs' untimely request for a jury trial, excluded an expert witness report filed after the deadline, found no evidence of an assignment of rights between E&C and E&I, and ruled against Plaintiffs on their fraud, deceit, and negligent misrepresentation claims. The United States Court of Appeals for the Eighth Circuit reviewed the case. The court held that the district court did not abuse its discretion in denying the jury trial request, as Plaintiffs failed to timely file the motion and did not justify the delay. The exclusion of the expert report was also upheld, as the district court properly applied the relevant factors and found the late report was neither substantially justified nor harmless. The court affirmed the district court's finding that there was no valid assignment of rights from E&C to E&I, meaning Liberty's promise to pay was to E&C, not E&I. The court also upheld the findings that Liberty did not have the intent to deceive or induce reliance, and that Bruce did not reasonably rely on Mattingly's statements. Finally, the court declined to address the unjust enrichment claim as Plaintiffs did not raise the argument below. The Eighth Circuit affirmed the district court's rulings in their entirety. View "E&I Global Energy Services v. Liberty Mutual Insurance Co." on Justia Law

Lorenzo v. Calex Engineering, Inc.

2025-03-28T10:13:40-08:00

Plaintiffs Francisco Lorenzo and Angelina Nicolas sued Core/Related Grand Avenue Owner, LLC, Tishman Construction Corporation of California, and Calex Engineering, Inc. for wrongful death after their daughters were killed by a dump truck driven by Stanley Randle, an employee of a subcontractor. The truck was traveling from an unpermitted off-site staging area to a construction project in downtown Los Angeles. Plaintiffs argued that the defendants' decision to use an unpermitted staging area was negligent and led to the accident. The Superior Court of Los Angeles County granted summary judgment in favor of the defendants, concluding that they did not owe a duty of care to the decedents. The court found that the defendants' actions were not the proximate cause of the accident and that the defendants did not have a duty to ensure the safety of the decedents under the circumstances. The California Court of Appeal, Second Appellate District, Division One, reversed the lower court's decision. The appellate court held that the defendants did owe a duty of care to the decedents. The court reasoned that Civil Code section 1714 establishes a general duty to exercise reasonable care for the safety of others, and the defendants' decision to establish an unpermitted staging area foreseeably created a risk of harm. The court also found that the Rowland factors did not justify an exception to this duty. The court further rejected the defendants' argument that their conduct did not proximately cause the accident, concluding that there were triable issues of fact regarding causation. The judgment was reversed, and the case was remanded for further proceedings. View "Lorenzo v. Calex Engineering, Inc." on Justia Law

May v. First Rate Excavate

2025-03-13T07:14:42-08:00

James and Amber May hired RES Construction to build their home in Sioux Falls. RES subcontracted First Rate Excavate, Inc. to install the septic system and construct the foundation. The Mays alleged that the foundation was installed several feet below grade level, causing significant drainage and septic issues that damaged their home, yard, and neighboring properties. They sued First Rate for negligence. The circuit court dismissed the claim based on the economic loss doctrine, and the Mays appealed. The Circuit Court of the Second Judicial Circuit in Lincoln County, South Dakota, dismissed the Mays' negligence claim, citing the economic loss doctrine, which limits remedies for purely economic losses to those specified in a contract. The court reasoned that the Mays lacked privity of contract with First Rate and that their claims were barred by the six-year statute of limitations. The Supreme Court of the State of South Dakota reviewed the case. The court held that the economic loss doctrine should not be expanded beyond claims arising from transactions involving the sale of defective goods under the Uniform Commercial Code (UCC). The court noted that the doctrine is designed to prevent parties from circumventing contract remedies by seeking tort remedies for economic losses. Since the Mays' claim was based on negligence and not on a UCC transaction, the economic loss doctrine did not apply. Additionally, the court found that the lack of privity between the Mays and First Rate further precluded the application of the economic loss doctrine. The Supreme Court reversed the circuit court's dismissal and remanded the case for further proceedings. View "May v. First Rate Excavate" on Justia Law

Peterson v. Brandon Coverdell Constr.

2025-01-17T06:07:49-08:00

Phillip and Jodi Peterson hired Brandon Coverdell Construction, Inc. (BCC) to perform work on their home following a hailstorm. The Petersons were dissatisfied with the quality of BCC's work, while BCC was unhappy with the Petersons' partial payment. Both parties accused each other of breaching their written agreement and filed lawsuits in the county court. The county court ruled in favor of BCC, finding that the Petersons committed the first material breach. The Petersons appealed to the District Court for Douglas County but failed to file a statement of errors. They obtained a continuance to amend the bill of exceptions in the county court. The district court eventually found that the county court had committed plain error by entering judgment in favor of BCC, concluding that the written agreement was an unenforceable illusory contract. BCC then appealed to the Nebraska Supreme Court. The Nebraska Supreme Court reviewed the case and found that the district court erred in considering the supplemental bill of exceptions, which was not properly part of the record. The Supreme Court also determined that the county court did not commit plain error. The county court's decision to focus on the issues presented by the parties, rather than the enforceability of the contract, did not result in damage to the integrity, reputation, or fairness of the judicial process. Consequently, the Nebraska Supreme Court reversed the district court's order and remanded the case with directions to affirm the county court's judgment. View "Peterson v. Brandon Coverdell Constr." on Justia Law

Lynch v. Peter & Associates

2025-01-01T09:14:25-08:00

Cheryl Lynch, the appellant, owned a residential property in San Clemente, California, and engaged a general contractor, Hutton Construction, for home improvement projects. The project included remodeling the existing residence, building additions, and other site improvements. Coastal Geotechnical was initially hired to evaluate the geotechnical conditions of the property. Later, Grover Construction replaced Hutton and hired Peter & Associates to perform a geotechnical inspection of a footing trench. Peter & Associates conducted a cursory inspection and reported the soil as suitable. However, the footing failed, causing significant damage to the property. The Lynches filed a lawsuit in February 2021 against multiple parties, including Peter & Associates, for breach of contract, nuisance, and negligence. The Superior Court of Orange County granted summary judgment in favor of Peter & Associates, concluding that the firm owed no duty of care to the Lynches due to the lack of a direct contract. The California Court of Appeal, Fourth Appellate District, Division Three, reviewed the case. The court found that Peter & Associates failed to meet its burden in the summary judgment motion. The court held that the firm owed a duty of care to the Lynches, despite the lack of privity, based on the Biakanja factors, which consider the extent to which the transaction was intended to affect the plaintiff, foreseeability of harm, and other factors. The court also found that the trial court erred in dismissing the nuisance claim and in sustaining evidentiary objections without proper basis. The Court of Appeal reversed the summary judgment and remanded the case to the trial court with instructions to deny Peter & Associates' motion in its entirety. The court emphasized the duty of care owed by construction professionals in residential projects and the necessity of addressing all elements of a nuisance claim. View "Lynch v. Peter & Associates" on Justia Law

Southwest v. 19th Judicial Dist.

2024-12-31T15:36:25-08:00

Donald Fleming filed a lawsuit against Caribou Creek Log Homes, Inc. and North Idaho Insulation, LLC, alleging that spray foam insulation installed by North Idaho Insulation caused significant structural damage to his residence in Montana. Fleming's claims included negligence, violations of residential construction defect statutes, the Montana Consumer Protection Act, and breach of warranties. North Idaho Insulation then filed a third-party complaint against Southwest Distributing Co. (Southwest), alleging that Southwest manufactured and sold the defective spray foam insulation and seeking indemnification and contribution. The Montana Nineteenth Judicial District Court denied Southwest's motion to dismiss for lack of personal jurisdiction, concluding that it had specific personal jurisdiction over Southwest under Montana Rule of Civil Procedure 4(b)(1). Southwest then petitioned the Montana Supreme Court for a writ of supervisory control, arguing that the District Court erred in its jurisdictional ruling. The Montana Supreme Court reviewed the case and determined that the District Court erred in concluding it had specific personal jurisdiction over Southwest. The Supreme Court found that Southwest did not transact business in Montana related to the claims and that the claims did not arise from Southwest's activities in Montana. Additionally, the Court held that the stream-of-commerce theory did not apply, as Southwest did not purposefully direct its activities toward Montana. Consequently, the Supreme Court granted the petition for a writ of supervisory control, reversed the District Court's order, and remanded the case for further proceedings consistent with its opinion. View "Southwest v. 19th Judicial Dist." on Justia Law

Curtis Park Group v. Allied World Specialty Insurance Company

2024-12-23T08:00:50-08:00

Curtis Park Group, LLC (Curtis Park) encountered a significant issue during the construction of a new development called S*Park, which included five buildings supported by a single concrete slab. The slab began to sag due to construction defects, and Curtis Park hired a consultant to determine the cause and necessary repairs. The repairs cost $2,857,157.78, which were fronted by the general contractor, Milender White, as per their agreement. Curtis Park had a builder’s risk insurance policy with Allied World Specialty Insurance Company (Allied World) but did not include Milender White or subcontractors as named insureds. The United States District Court for the District of Colorado reviewed the case, where Curtis Park sued Allied World for breach of contract and bad faith after Allied World denied coverage for the repair costs. The district court ruled that Curtis Park could seek coverage for the repair costs even though Milender White had absorbed these costs. The jury found in favor of Curtis Park on the breach-of-contract and statutory bad-faith claims but not on the common-law bad-faith claim. Allied World’s motions for a new trial and judgment as a matter of law were denied. The United States Court of Appeals for the Tenth Circuit reviewed the case. The court held that the district court erred in interpreting the insurance policy to allow Curtis Park to recover repair costs it had not paid and had no obligation to pay. The policy explicitly limited recovery to the amount the named insured (Curtis Park) actually spent on repairs. The Tenth Circuit reversed the jury’s verdict and remanded for a new trial, instructing that Curtis Park cannot recover the costs of repair that it did not pay. The court also vacated the remainder of the judgment and remanded for a new trial on all other issues. View "Curtis Park Group v. Allied World Specialty Insurance Company" on Justia Law

Hogan & Associates Builders, LLC v. Eiden Construction, LLC

2024-12-20T08:12:07-08:00

Eiden Construction, LLC (Eiden) entered into a subcontract with Hogan & Associates Builders, LLC (Hogan) for earthwork and utilities on a school construction project. Hogan sued Eiden and its bonding company, AMCO Insurance Company (AMCO), for breach of contract, claiming Eiden failed to complete its work, including draining sewage lagoons and constructing a fire pond. Eiden counterclaimed for unpaid work, arguing it was not responsible for draining the lagoons and that Hogan did not comply with the subcontract’s notice and opportunity to cure provisions. AMCO argued it was not liable under the performance bond because Eiden did not breach the subcontract and Hogan did not provide proper notice. The District Court of Uinta County found for Hogan on the claim regarding the sewage lagoons but not on other claims, ruling AMCO was not liable under the bond due to lack of notice. Eiden and Hogan both appealed. Eiden argued the court erred in finding it responsible for draining the lagoons and in awarding Hogan damages billed to an associated company. Hogan contended the court erred in not awarding damages for other work and in its calculation of prejudgment interest. The Wyoming Supreme Court affirmed the lower court’s decision. It held Eiden breached the subcontract by not draining the lagoons and that Hogan was entitled to recover costs for supplementing Eiden’s work. The court found Eiden’s late completion of the septic system justified Hogan’s directive to expedite lagoon drainage. It also ruled Hogan properly paid the supplemental contractors, despite invoices being sent to an associated company. The court rejected Hogan’s claims for additional damages, concluding Eiden complied with the notice to cure provisions for the fire pond and other work. The court also upheld the lower court’s calculation of prejudgment interest, applying the offset before calculating interest. View "Hogan & Associates Builders, LLC v. Eiden Construction, LLC" on Justia Law

Moyer v. Lasher Construction, Inc.

2024-12-18T08:15:00-08:00

In 2014, Casey Moyer entered into an agreement with Doug Lasher Construction, Inc. for the construction and purchase of a new home, which was substantially completed in November 2014. Over the next six-and-a-half years, Moyer repeatedly informed Lasher Construction about issues with the home, particularly water leakage, and received assurances that the issues would be fixed. However, the problems persisted, and Moyer and Caitlin Bower filed suit against Lasher Construction in November 2021, alleging breach of contract and violation of the Idaho Consumer Protection Act. The District Court of the Fourth Judicial District of Idaho granted summary judgment in favor of Lasher Construction, ruling that all claims were time-barred under Idaho Code sections 5-241(b) and 5-216, which require that claims arising out of a contract for the construction of real property be brought within five years of the final completion of construction. The court also found that the Idaho Consumer Protection Act claims were time-barred under the two-year statute of limitations provided by Idaho Code section 48-619. The court rejected the homeowners' arguments for equitable estoppel and the repair doctrine, concluding that they failed to show that Lasher Construction prevented them from pursuing their claims within the statutory period. The Supreme Court of Idaho affirmed the district court's decision. The court reaffirmed that the repair doctrine is not available in Idaho and upheld the district court's conclusion that the homeowners failed to establish the elements of equitable estoppel. The court also agreed that the text messages and the July 2, 2021, response to the NORA demand did not constitute enforceable independent contracts. Lasher Construction was awarded attorney fees and costs on appeal as the prevailing party. View "Moyer v. Lasher Construction, Inc." on Justia Law

Genho v. Riverdale Hot Springs, LLC

2024-12-10T10:34:17-08:00

Daniel Genho and Riverdale Hot Springs, LLC had a dispute over payment for construction work Genho performed at Riverdale Resort. Genho was not a registered contractor at the start of the project but became registered midway through. Riverdale refused to pay Genho and prevented him from retrieving his tools and materials. Genho filed a Mechanic’s and Materialmen’s Lien and sued for breach of contract, unjust enrichment, quantum meruit, conversion, and to foreclose on the lien. The District Court of the Sixth Judicial District of Idaho granted Riverdale’s motion for a directed verdict on the breach of contract claim but denied it on the other claims. The court found that there were two separate transactions: one before and one after Genho became a registered contractor. The court allowed the jury to consider the unjust enrichment, quantum meruit, conversion, and lien foreclosure claims. The jury found in favor of Genho, awarding him $295,568, which was later reduced to $68,681. The district court also awarded attorney fees to Genho. The Supreme Court of Idaho reviewed the case and affirmed the district court’s decision in part and reversed it in part. The court held that equitable remedies are available under the Idaho Contractor Registration Act (ICRA) for work performed after a contractor becomes registered, provided the work is severable from the unregistered work. The court affirmed the denial of a directed verdict on the unjust enrichment, quantum meruit, and lien foreclosure claims but reversed the award of attorney fees for the conversion claim, as it was not based on a commercial transaction. The court also affirmed the award of attorney fees for the foreclosure action under Idaho Code section 45-513. Neither party was awarded attorney fees on appeal. The judgment was vacated and remanded for modification consistent with the opinion. View "Genho v. Riverdale Hot Springs, LLC" on Justia Law

Rochon Corporation of Iowa, Inc. v. Des Moines Area Community College

2024-11-22T07:06:10-08:00

Graphite Construction Group, Inc. (Graphite) was hired by Des Moines Area Community College (DMACC) in 2019 for a construction project. DMACC withheld 5% of each payment as retainage, amounting to about $510,000 by January 2022. Graphite requested the release of the retainage, but the project was not yet completed. A dispute arose between Graphite and a subcontractor, Metro Concrete, Inc. (Metro), over unpaid services. Metro filed a claim, and Graphite filed a bond for twice the amount of Metro’s claim, demanding the release of the retainage. The Iowa District Court for Polk County denied Graphite’s motion to compel the release of the retainage, stating that under Iowa Code chapter 573, retainage could not be released before the project’s completion and final acceptance. The court also denied Graphite’s request for attorney fees, as Graphite had not prevailed on its retainage claim. The Iowa Court of Appeals reversed the district court’s decision, ordering the release of the retainage to Graphite but denied Graphite’s request for attorney fees. DMACC sought further review from the Iowa Supreme Court. The Iowa Supreme Court vacated the Court of Appeals' decision and affirmed the district court’s judgment. The Supreme Court held that under Iowa Code chapter 573, retainage could not be released before the project’s completion and final acceptance, and the statutory exceptions did not apply in this case. The court also upheld the denial of attorney fees to Graphite, as they were not the prevailing party. View "Rochon Corporation of Iowa, Inc. v. Des Moines Area Community College" on Justia Law

Jerry & John Woods Construction, Inc. v. Jordan

2024-11-22T06:30:05-08:00

In May 2022, Jerry & John Woods Construction, Inc. ("Woods Construction") entered into a contract with John David Jordan and Carol S. Jordan to construct a house and a metal building. Woods Construction claimed the Jordans failed to pay for the work performed, leading the company to sue them in the Dallas Circuit Court for breach of contract and unjust enrichment. The Jordans moved to dismiss or for summary judgment, arguing that Woods Construction's lack of a required residential-home-builder's license barred the company from bringing civil claims. They also filed counterclaims alleging improper and negligent work by Woods Construction. The Dallas Circuit Court denied the Jordans' motion to dismiss but later granted their motion for summary judgment, finding that Woods Construction, as an unlicensed residential home builder, was barred from enforcing the construction contract under § 34-14A-14(d) of the Alabama Code. The court also declared Woods Construction's "Notice of Lis Pendens/Lien" null and void. The court certified its judgment as final under Rule 54(b), despite the Jordans' counterclaims remaining pending. The Supreme Court of Alabama reviewed the case and determined that the Rule 54(b) certification was improper. The court noted that the claims and counterclaims were closely intertwined, as both concerned the same contract and construction work. Additionally, the resolution of the Jordans' counterclaims could potentially moot Woods Construction's claims. Therefore, the court concluded that the circuit court exceeded its discretion in certifying the judgment as final and dismissed the appeal for lack of a final judgment. View "Jerry & John Woods Construction, Inc. v. Jordan" on Justia Law

Admiral Insurance Company v. Tocci Building Corporation

2024-11-08T10:00:03-08:00

A general contractor, Tocci Building Corporation, and its affiliates were involved in a dispute with their insurers, including Admiral Insurance Company, over coverage under a commercial general liability (CGL) insurance policy. The issue was whether the CGL policy covered damage to non-defective parts of a construction project caused by a subcontractor's defective work on another part of the project. Tocci sought defense and indemnity coverage under the Admiral policy for a lawsuit filed by Toll JM EB Residential Urban Renewal LLC, which alleged various issues with Tocci's work on a residential construction project. The United States District Court for the District of Massachusetts concluded that Admiral had no duty to defend Tocci. The court found that the lawsuit did not allege "property damage" caused by an "occurrence" as required for coverage under the policy. The court reasoned that the damage alleged was within the scope of the project Tocci was hired to complete and thus did not qualify as "property damage." Additionally, the court held that faulty workmanship did not constitute an "accident" and therefore was not an "occurrence" under the policy. The United States Court of Appeals for the First Circuit reviewed the case and affirmed the district court's decision, but for different reasons. The appellate court focused on the policy's exclusions, particularly the "Damage to Property" exclusion (j)(6), which excludes coverage for property that must be restored, repaired, or replaced because the insured's work was incorrectly performed on it. The court concluded that this exclusion applied to the entire project since Tocci was the general contractor responsible for the entire construction. The court also noted that Tocci did not meet its burden of showing that any exceptions to the exclusion applied, such as the "products-completed operations hazard," because Tocci's work was not completed or abandoned. Thus, the appellate court held that Admiral had no duty to defend Tocci in the underlying lawsuit. View "Admiral Insurance Company v. Tocci Building Corporation" on Justia Law

TIG Insurance Company v. Woodsboro Farmers Coop

2024-09-20T09:30:31-08:00

In March 2013, Woodsboro Farmers Cooperative contracted with E.F. Erwin, Inc. to construct two grain silos. Erwin subcontracted AJ Constructors, Inc. (AJC) for the assembly. AJC completed its work by July 2013, and Erwin finished the project in November 2013. However, Woodsboro noticed defects causing leaks and signed an addendum with Erwin for repairs. Erwin's attempts to fix the silos failed, leading Woodsboro to hire Pitcock Supply, Inc. for repairs. Pitcock found numerous faults attributed to AJC's poor workmanship, necessitating complete deconstruction and reconstruction of the silos, costing Woodsboro $805,642.74. Woodsboro sued Erwin in Texas state court for breach of contract, and the case went to arbitration in 2017. The arbitration panel found AJC's construction was negligent, resulting in defective silos, and awarded Woodsboro $988,073.25 in damages. The Texas state court confirmed the award in September 2022. In December 2018, TIG Insurance Company, Erwin's insurer, sought declaratory relief in the United States District Court for the Southern District of Texas, questioning its duty to defend and indemnify Erwin. The district court granted TIG's motion for summary judgment on the duty to defend, finding no "property damage" under the policy, and later ruled there was no duty to indemnify, as the damage was due to defective construction. The United States Court of Appeals for the Fifth Circuit reviewed the case. The court found that there were factual questions regarding whether the damage constituted "property damage" under the insurance policy, as the silos' metal parts were damaged by wind and weather due to AJC's poor workmanship. The court determined that the district court erred in granting summary judgment for TIG and concluded that additional factual development was needed. The Fifth Circuit reversed the district court's decision and remanded the case for further proceedings. View "TIG Insurance Company v. Woodsboro Farmers Coop" on Justia Law

Lynch v. Peter & Associates

2024-09-11T09:31:16-08:00

Cheryl Lynch, the owner of a residential property in San Clemente, California, engaged a general contractor for home improvement and repairs. The contractor hired Peter & Associates, Engineers, Geologists, Surveyors, Inc. (the Peter firm) to perform a geotechnical inspection of a footing trench. The Peter firm conducted a visual inspection and used a steel probe but did not perform subsurface exploration or laboratory testing. The footing later collapsed, causing significant damage to Lynch's home. Lynch filed a lawsuit in February 2021 against multiple parties, including the Peter firm, for breach of contract, nuisance, and negligence. The Peter firm moved for summary judgment, arguing it owed no duty of care to Lynch due to the lack of a direct contract. The Superior Court of Orange County granted the motion, heavily relying on the precedent set by Weseloh Family Ltd. Partnership v. K.L. Wessel Construction Co., Inc., which found no duty of care in the absence of privity. The Court of Appeal of the State of California, Fourth Appellate District, Division Three, reviewed the case. The court found that the Peter firm failed to meet its burden in the summary judgment motion. The court held that the firm owed a duty of care to Lynch, applying the Biakanja factors, which consider the extent to which the transaction was intended to affect the plaintiff, the foreseeability of harm, and other factors. The court also found that the trial court erred in dismissing Lynch's nuisance claim and in sustaining the Peter firm's evidentiary objections without proper basis. The Court of Appeal reversed the summary judgment and remanded the case to the trial court with instructions to deny the Peter firm's motion in its entirety. View "Lynch v. Peter & Associates" on Justia Law

Bock v. People

2024-09-10T05:15:46-08:00

Jamie Edward Bock was charged with nine counts of theft for actions occurring between November 2014 and November 2016. He was accused of taking initial payments from homeowners for construction work, some of which he started but did not complete, and others he did not begin at all. Bock requested and received additional funds for four projects but failed to complete any of them or return the money. The trial court joined five cases into a single trial and instructed the jury that Bock could not be convicted of four counts unless the prosecution proved multiple acts of theft within six months of each other. Bock argued that this instruction constructively amended his charges, which were originally under a statute punishing single acts of theft, and claimed this amendment was a structural error requiring reversal. The jury convicted Bock on all counts, and he was sentenced to twenty years in prison. On appeal, the Colorado Court of Appeals agreed that the jury instructions constituted a constructive amendment but held that it did not require reversal, applying plain error review. The Supreme Court of Colorado reviewed the case and agreed that the jury instructions constructively amended the charges. However, the court held that such an amendment is not a structural error and should be reviewed for plain error. The court concluded that Bock did not demonstrate plain error because he had sufficient notice to mount a defense, and the prosecution's burden of proof was not materially lessened. Therefore, the court affirmed the decision of the Colorado Court of Appeals and upheld Bock's convictions. View "Bock v. People" on Justia Law

American Building Innovations v. Balfour Beatty Construction

2024-09-03T09:32:07-08:00

American Building Innovation LP (ABI) was hired by Balfour Beatty Construction, LLC (Balfour Beatty) as a subcontractor for a school construction project. ABI had a workers’ compensation insurance policy when it began work, but the policy was canceled due to ABI’s refusal to pay outstanding premiums from a previous policy. This cancellation led to the automatic suspension of ABI’s contractor’s license. Despite knowing it was unlicensed and uninsured, ABI continued working on the project. The Superior Court of Orange County found that ABI was not duly licensed at all times during the performance of its work, as required by California law. ABI’s license was suspended because it failed to maintain workers’ compensation insurance. ABI later settled its premium dispute and had the policy retroactively reinstated, but the court found this retroactive reinstatement meaningless because it occurred long after the statute of limitations for any workers’ compensation claims had expired. The court ruled that ABI could not maintain its action to recover compensation for its work due to its lack of proper licensure. The California Court of Appeal, Fourth Appellate District, Division Three, affirmed the lower court’s judgment. The court held that ABI was not entitled to retroactive reinstatement of its license because the failure to maintain workers’ compensation insurance was not due to circumstances beyond ABI’s control. ABI’s decision not to pay the premiums and its false representations to the Contractors’ State License Board were within its control. Consequently, ABI was barred from bringing or maintaining the action under section 7031 of the Business and Professions Code. The court also affirmed the award of attorney fees to Balfour Beatty under the subcontract’s prevailing party attorney fee provision. View "American Building Innovations v. Balfour Beatty Construction" on Justia Law

American Environmental, Inc. v. Burlington School District

2024-08-30T08:51:35-08:00

American Environmental, Inc. (plaintiff) challenged the Burlington School District (defendant) over a contract awarded for the demolition and remediation of Burlington High School, which was closed due to toxic substances. The District sent a Request for Qualifications to fifteen contractors, including the plaintiff and the winning bidder, EnviroVantage. The plaintiff argued that EnviroVantage did not meet the prequalification criteria and that the contract should have been awarded to them. The Superior Court, Chittenden Unit, Civil Division, denied the plaintiff's request for a preliminary injunction, citing potential financial harm to the District and public interest. The court later granted summary judgment to the District, finding the case moot because the project was substantially complete. The court applied factors from Citineighbors Coalition of Historic Carnegie Hill ex rel. Kazickas v. New York City Landmarks Preservation Commission, determining that no effective relief could be granted due to the project's advanced stage. The Vermont Supreme Court took judicial notice of the project's completion, including demolition and soil remediation, based on public records and visual evidence. The court dismissed the appeal as moot, stating that no effective relief could be provided under Rule 75, which does not allow for damages. The court also rejected the plaintiff's argument that the case met the exception for issues capable of repetition yet evading review, noting the plaintiff's delay in seeking expedited relief and the lack of demonstrated probability of encountering the same situation again. View "American Environmental, Inc. v. Burlington School District" on Justia Law

Five Rivers Carpenters v. Covenant Construction Services

2024-08-20T07:30:24-08:00

Covenant Construction Services, LLC was the prime contractor on a federal construction project for a U.S. Department of Veterans Affairs facility in Iowa City, Iowa. Covenant subcontracted with Calacci Construction Company, Inc. to supply carpentry labor and materials. Calacci had a collective bargaining agreement (CBA) with two regional unions, requiring it to pay fringe-benefit contributions to the Five Rivers Carpenters Health and Welfare Fund and Education Trust Fund (the Funds). Despite multiple demands, Calacci failed to remit the required contributions. The Funds filed a lawsuit under the Miller Act to collect the unpaid contributions, liquidated damages, interest, costs, and attorneys' fees from Covenant and its surety, North American Specialty Insurance Company. The United States District Court for the Southern District of Iowa granted summary judgment in favor of the Funds, concluding that the Funds had standing to sue and that the Miller Act notice was properly served and timely. The United States Court of Appeals for the Eighth Circuit reviewed the case de novo. The court affirmed the district court's decision, holding that the Funds sufficiently complied with the Miller Act's notice requirements by sending the notice to Covenant's attorney, who confirmed receipt. The court also held that the notice was timely as it was filed within 90 days of the last day of labor on the project. Additionally, the court upheld the award of liquidated damages and attorneys' fees, finding that the CBA obligated Calacci to pay these amounts and that Covenant, as the prime contractor, was liable for the amounts due under the payment bond. The Eighth Circuit concluded that the Funds were entitled to recover the unpaid contributions, liquidated damages, and attorneys' fees from Covenant and its surety, affirming the district court's judgment. View "Five Rivers Carpenters v. Covenant Construction Services" on Justia Law

Diamond Services v. RLB Contracting

2024-08-16T15:30:16-08:00

A sub-subcontractor, Diamond Services Corporation, entered into a contract with Harbor Dredging, a subcontractor, to perform dredging work in the Houston Ship Channel. The prime contract for the project was awarded to RLB Contracting by the U.S. Army Corps of Engineers, and RLB obtained a surety bond from Travelers Casualty and Surety Company of America. During the project, unexpected site conditions, including the presence of tires, caused delays and increased costs. Diamond continued working based on an alleged agreement that it would be compensated through a measured-mile calculation in a request for equitable adjustment (REA) submitted by RLB to the Corps. However, RLB later settled the REA for $6,000,000 without directly involving Diamond in the negotiations and issued a joint check to Harbor and Diamond for $950,000. The United States District Court for the Southern District of Texas dismissed some of Diamond's claims, including those for unjust enrichment and express contractual claims against RLB, but allowed Diamond's quantum meruit claim to proceed. The court also denied Travelers' motion to dismiss Diamond's Miller Act claims but required Diamond to amend its complaint to include proper Miller Act notice, which Diamond failed to do timely. Subsequently, the district court granted summary judgment in favor of RLB and Harbor, dismissing Diamond's remaining claims and striking Diamond's untimely second amended complaint. The United States Court of Appeals for the Fifth Circuit reviewed the case. The court affirmed the district court's summary judgment against Diamond's quantum meruit claims, holding that the express sub-subcontract covered the damages Diamond sought and that Diamond failed to provide evidence of the reasonable value of the work performed. The court also affirmed the dismissal of Diamond's Miller Act claim, as the damages sought were not recoverable under the Act. The court dismissed Diamond's appeal regarding the tug-expenses claim due to untimeliness. View "Diamond Services v. RLB Contracting" on Justia Law

Delaware River Joint Toll Bridge Commission v. George Harms Construction Co., Inc.

2024-08-01T06:07:12-08:00

The Delaware River Joint Toll Bridge Commission (Commission), a bi-state entity created by an interstate compact between New Jersey and Pennsylvania, sought to replace the I-95 Scudder Falls Bridge. The Commission decided to use a Project Labor Agreement (PLA) for the project, which required contractors to hire at least 75% of their workforce from specified local unions. George Harms Construction Company, Inc. (Harms), which had a collective bargaining agreement with a different union, challenged the PLA, arguing it was unlawful because it excluded their union. The trial court denied Harms' request for a preliminary injunction and dismissed Harms' counterclaims, ruling that New Jersey’s competitive bidding laws did not apply to the Commission. However, it also dismissed the Commission’s complaint, stating the lawsuit was not properly authorized by the Commission as a whole. The Appellate Division affirmed the dismissal of the Commission’s complaint but reversed the dismissal of certain counterclaims, concluding that the Commission lacked authority to use a PLA because New Jersey and Pennsylvania did not have complementary or parallel laws on PLAs. The Supreme Court of New Jersey reversed the Appellate Division’s judgment. It held that the plain language of the Compact authorizes the Commission to require the use of a PLA in a publicly bid construction project. The Court found that the Commission’s broad powers under the Compact include the authority to use PLAs, even though the Compact does not explicitly mention them. The Court also determined that the Appellate Division erred in looking beyond the Compact to state laws that do not mention the Commission. The case was remanded for further proceedings consistent with this opinion. View "Delaware River Joint Toll Bridge Commission v. George Harms Construction Co., Inc." on Justia Law

Keiland Construction v. Weeks Marine

2024-07-25T15:30:14-08:00

Keiland Construction, L.L.C. entered into a construction subcontract with Weeks Marine, Inc. for a project in Louisiana. Weeks terminated the contract for convenience, leading to a dispute over compensation. Keiland submitted pay applications and demobilization costs, which Weeks partially paid. The disagreement centered on whether the contract required lump-sum payments for work completed before termination or if it converted to a cost-plus basis upon termination. The United States District Court for the Western District of Louisiana held a bench trial and found the contract ambiguous. It construed the ambiguity against Keiland, the drafter, and ruled in favor of Weeks. The court awarded Keiland damages based on Weeks’s interpretation of the contract but denied Keiland’s claims for direct employee and demobilization costs. The court also awarded Weeks attorneys’ fees and costs, though less than requested, and denied Weeks’s motion for post-offer-of-judgment fees and costs. The United States Court of Appeals for the Fifth Circuit reviewed the case. It affirmed the district court’s findings, agreeing that the contract was ambiguous and that the ambiguity should be construed against Keiland. The appellate court upheld the district court’s rulings on damages, attorneys’ fees, and costs, including the denial of post-offer-of-judgment fees and costs. The court also affirmed the award of prejudgment interest to Keiland, finding no abuse of discretion. In summary, the Fifth Circuit affirmed the district court’s judgment in all respects, including the interpretation of the contract, the award of damages, attorneys’ fees, costs, and prejudgment interest. View "Keiland Construction v. Weeks Marine" on Justia Law

El-Jamaly V Kirco Manix Construction Llc

2024-07-19T05:00:03-08:00

The plaintiff, an employee of a subcontractor, was electrocuted while carrying a long-handled aluminum tool at a construction site. The tool either touched or came close to a high-voltage power line owned by the defendant utility company. The plaintiff sustained severe injuries, including amputations and a traumatic brain injury. He filed a lawsuit against the general contractor and the utility company, alleging negligence and premises liability. The Wayne Circuit Court denied the defendants' motions for summary disposition. The Michigan Court of Appeals reversed, holding that the general contractor was not liable under the common work area doctrine and that the utility company did not owe a duty of care to the plaintiff. The plaintiff sought leave to appeal to the Michigan Supreme Court. The Michigan Supreme Court held that the plaintiff presented sufficient evidence to survive summary disposition. The court found genuine issues of material fact regarding three of the four elements of the common work area doctrine for the general contractor. Specifically, there were factual disputes about the height of the power lines and whether the general contractor took reasonable steps to guard against the danger. The court also found that multiple subcontractors were exposed to the risk, satisfying the requirement of a high degree of risk to a significant number of workers in a common work area. Regarding the utility company, the court found genuine issues of material fact about whether the power lines were properly maintained and whether the injury was foreseeable. The court concluded that the utility company had a duty to ensure the safety of the power lines, given the pre-injury communications and the known dangers of high-reaching conductive tools. The Michigan Supreme Court reversed the Court of Appeals' decision and remanded the case to the trial court for further proceedings. View "El-Jamaly V Kirco Manix Construction Llc" on Justia Law

Lithko Contracting v. XL Insurance America, Inc.

2024-07-15T11:04:39-08:00

A commercial tenant and landlord entered into a contract for the construction and lease of a warehouse, with the landlord also acting as the general contractor. The contract included a waiver of subrogation, where both parties waived subrogation against each other for certain losses, including those caused by their subcontractors. After the warehouse sustained weather damage, the tenant’s insurer sought to recoup insurance payments by suing the subcontractors. The Circuit Court for Baltimore City granted summary judgment in favor of the subcontractors, concluding that they were intended beneficiaries of the waiver of subrogation in the contract between the tenant and landlord. The court did not consider any extrinsic evidence regarding the parties' intent. The Appellate Court of Maryland reversed this decision, finding that the waiver of subrogation in the contract did not unambiguously benefit the subcontractors and that the subcontractors were not intended third-party beneficiaries. The Supreme Court of Maryland reviewed the case and held that the waiver of subrogation in the contract between the tenant and landlord did not extend to the subcontractors. The court found that the language of the waiver was unambiguous and did not show an intent to benefit the subcontractors. However, the court found that the waiver of subrogation included in the subcontracts was ambiguous regarding whether it applied to the tenant’s insurer’s claims against the subcontractors. Therefore, the court held that extrinsic evidence was needed to determine the parties' intent regarding the scope of the subrogation waiver in the subcontracts. The Supreme Court of Maryland affirmed the Appellate Court's decision, reversing the Circuit Court's summary judgment in favor of the subcontractors, and remanded the case for further proceedings to consider extrinsic evidence. View "Lithko Contracting v. XL Insurance America, Inc." on Justia Law

SR Construction v. RE Palm Springs II

2024-07-02T15:30:16-08:00

The case revolves around a dispute between SR Construction (SRC), a construction company, and RE Palm Springs II, L.L.C. (RPS), a company formed to take title to a hotel property. SRC was hired to build a hotel in California but was terminated before completion, leaving it with a demand for $14 million in unpaid work. After several failed attempts to recover its dues, SRC held onto certain personal property left over from the hotel project. The bankruptcy court ordered SRC to turn over the personal property, which SRC appealed. The lower courts had a series of interactions with this case. The bankruptcy court initially ordered SRC to turn over the personal property. SRC appealed this decision, challenging the bankruptcy court's power to order the turnover and the validity of the most recent hotel owner's claim to the personal property. The district court affirmed the bankruptcy court's decision, concluding that the bankruptcy court had jurisdiction to interpret and enforce the Sale Order. It also affirmed the bankruptcy court's conclusion that Hall had obtained title to the Personal Property and had not waived its right to the Personal Property by taking it "as is." The United States Court of Appeals for the Fifth Circuit affirmed the lower courts' decisions. The court concluded that the bankruptcy court's order was part of its undisputed power to order the sale of a bankruptcy debtor's assets. It also rejected SRC's arguments about ownership of the assets in this case. The court found that the bankruptcy court had jurisdiction to enter the Turnover Order because that order interpreted and enforced the Sale Order. It also concluded that because the Turnover Order is integral to and inseparable from RPS's bankruptcy, it is a core matter. Therefore, issuing the Turnover Order was entirely within the bankruptcy court's authority. The court also affirmed the conclusion that title to the Personal Property passed from SRC to Palm Springs, then to RPS, and finally to Hall. View "SR Construction v. RE Palm Springs II" on Justia Law

Busher v. Cook

2024-07-02T13:34:29-08:00

The case involves a class action lawsuit brought by homeowners in the Falcon Ridge subdivision in Billings, Montana, against Buscher Construction and Development, Inc., and other related entities and individuals (collectively referred to as the "Buschers"). The homeowners alleged that the Buschers negligently designed and developed the subdivisions, failed to construct homes to mitigate against the possibility of differential settlement on hydro-collapsible soils, and failed to disclose material adverse facts known to them as the original owners of all the lots within the subdivision. The District Court of the Thirteenth Judicial District, Yellowstone County, certified the class action. The Buschers appealed this decision, arguing that the proposed class did not satisfy the prerequisites for class certification under Montana Rule of Civil Procedure 23(a) and that the court abused its discretion by certifying the class under Rule 23(b)(3). The Supreme Court of the State of Montana affirmed the lower court's decision. The court found that the proposed class satisfied the commonality and typicality requirements of Rule 23(a). The court also found that the class action was superior to other methods for fairly and efficiently adjudicating the controversy, as required by Rule 23(b)(3). The court concluded that the homeowners' claims were not dependent upon individual conduct but on the Buschers' alleged uniform negligence. The court also noted that the lower court has the discretion to revisit certification if class claims no longer predominate as the case proceeds. View "Busher v. Cook" on Justia Law

United States v. Vinas

2024-07-01T13:30:05-08:00

The case revolves around Agustin Vinas, who was convicted under 18 U.S.C. § 1958 for attempting to hire a hitman to murder a contractor and his business partner. Vinas, a subcontractor, claimed that the contractor owed him $8,500 for construction work and had threatened to harm him and his family when he tried to collect the debt. Vinas was arrested after a series of meetings with an undercover law enforcement officer posing as a hitman. He pleaded guilty to using facilities of interstate commerce in the commission of murder-for-hire, and the government agreed to dismiss the second count related to interstate travel in the commission of murder-for-hire. The District Court for the District of Rhode Island sentenced Vinas to time served, which amounted to nearly two years in pretrial detention. The government had recommended a sentence of ten years' imprisonment, arguing that a substantial sentence was necessary for specific and general deterrence. However, the defense argued for a sentence of time served, citing Vinas's attempts to peacefully collect the debt, the threats he received from the contractor, his mental health issues, and his efforts towards rehabilitation while in pretrial custody. The government appealed the sentence to the United States Court of Appeals for the First Circuit, arguing that the sentence was substantively unreasonable given the seriousness of the crime. The government also contended that the District Court had categorically refused to consider general deterrence and had created a disparity with defendants in other cases who were given longer sentences for the same statutory violation. The Court of Appeals affirmed the District Court's decision, finding that the sentence was within the expansive universe of reasonable sentences and that the District Court had adequately considered the sentencing factors set forth in 18 U.S.C. § 3553(a). The Court of Appeals also found that the government had not preserved its arguments regarding general deterrence and sentencing disparity, and that these arguments did not meet the plain error standard. View "United States v. Vinas" on Justia Law

CBRE v. Superior Court of San Diego County

2024-06-28T10:31:28-08:00

The case involves a worker, Jake Johnson, who was injured while working as an electrician on a construction project managed by CBRE and owned by Property Reserve, Inc. (PRI). Johnson was employed by PCF Electric, a subcontractor hired by Crew Builders, the general contractor for the project. Johnson filed a complaint against CBRE, PRI, Crew, and PCF for damages. CBRE and PRI moved for summary judgment based on the Privette doctrine, which generally protects entities that hire independent contractors from liability for injuries sustained by the employees of the independent contractor. The trial court denied the motion, finding a triable issue of fact as to when CBRE and PRI hired Crew for the project. The Court of Appeal, Fourth Appellate District, Division One, State of California, disagreed with the trial court's decision. The appellate court found that a written contract was not required to invoke the Privette doctrine, and the undisputed facts established that CBRE and PRI delegated control over the tenant improvements to Crew prior to Johnson’s injury. The court also found that no exception to the Privette doctrine applied. The court concluded that because no triable issues of material fact precluded summary judgment, CBRE and PRI were entitled to relief. The court ordered the trial court to vacate its previous order and enter a new one granting summary judgment to CBRE and PRI. View "CBRE v. Superior Court of San Diego County" on Justia Law

Pinkham v. Plate

2024-06-28T07:33:14-08:00

The case involves Scott and Natalie Pinkham, who contracted with Three Peaks Homes, LLC, for the construction of a custom home. The construction did not go as planned and the contract was terminated before the home was completed. Three Peaks subsequently filed two $600,000 mechanics’ liens against the Pinkhams’ home. The Pinkhams then filed a complaint against David Plate, Rebeccah Jensen, Three Peaks, Rebel Crew Construction, LLC, and Legacy Management Enterprises, LLC, asserting several causes of action. The district court denied the Pinkhams’ motion for summary judgment. Later, the Pinkhams’ attorney, Lance Schuster, filed a motion to withdraw as counsel for Plate, Jensen, Three Peaks, and Legacy, which the court granted. The court ordered Appellants to appoint another attorney or appear in person within twenty-one days of service of the order, failing which, the court may enter default judgment against them. The court clerk served a copy of the withdrawal order on Appellants via first class mail. The Pinkhams moved for the entry of default and default judgment against Appellants and for dismissal of Appellants’ counterclaims with prejudice. The district court granted the Pinkhams’ motion without a hearing. Appellants later secured new counsel and filed a motion to set aside the default and default judgment under Idaho Rule of Civil Procedure 60(b)(1), (4), and (6). The district court denied Appellants’ motion. On appeal, the Supreme Court of the State of Idaho affirmed the district court’s decision denying the motion to set aside the default and default judgment. The court held that the district court did not err in concluding that Appellants failed to demonstrate good cause to set aside the entry of default. The court also held that Appellants have failed to establish a right to relief under Rule 60(b). The court declined to award attorney fees on appeal. View "Pinkham v. Plate" on Justia Law

Lusardi Construction Co. v. Dept. of Industrial Rel.

2024-06-25T10:07:33-08:00

The case involves Lusardi Construction Company (Lusardi), a prime contractor, and its subcontractor, Pro Works Contracting Inc. (Pro Works). Pro Works violated certain Labor Code provisions by failing to hire apprentices for a construction project. The Department of Industrial Relations and the Division of Labor Standards Enforcement (DLSE) cited Pro Works for these violations and ordered Lusardi to pay penalties. Lusardi's administrative appeal was unsuccessful, and it subsequently filed a petition for writ of administrative mandamus, which the superior court denied. Lusardi argued that the superior court erroneously concluded that it knew of Pro Works's violations and that the joint and several liability provision applied. The Superior Court of San Diego County affirmed the DLSE's decision, concluding that Lusardi had knowledge of Pro Works's violations and was liable for the penalties. The court also found that substantial evidence supported the findings relating to the amount of the penalty assessment. The court rejected Lusardi's claim of due process violations, stating that Lusardi was put on notice of the potential for being held jointly and severally liable for Pro Works’s apprentice hiring violations. The Court of Appeal, Fourth Appellate District Division One State of California affirmed the lower court's decision. The court held that the superior court did not err in interpreting the statute, which provides two inclusive and alternative ways for imposing liability on a prime contractor for penalties resulting from the subcontractor’s violations. The court also found that substantial evidence supported the penalty imposed. The court concluded that Lusardi was not denied due process when it refused to enforce its subpoena or ask for a continuance to secure the witness’s attendance. View "Lusardi Construction Co. v. Dept. of Industrial Rel." on Justia Law