Justia Construction Law Opinion Summaries

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

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

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 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

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

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

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

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

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

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