Justia Construction Law Opinion Summaries

Articles Posted in California Courts of Appeal
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Decedent was employed by Jones as a construction worker. Jones was under contract with DOT to perform construction work on I-580 in Oakland. Much of this work was performed at night because it required lane closures. A car operated by a drunk driver entered the closed lanes of the project site and struck Decedent, who died on the scene. A wrongful death lawsuit against DOT asserted vicarious liability for the negligence of its employees; failure to discharge a mandatory duty; and dangerous condition on public property. The court dismissed the mandatory duty claim. DOT offered evidence that it did not instruct or control Jones as to how to comply with its safety obligations but that Jones complied with its safety plan on the night in question and that the contract between DOT and Jones delegated to Jones the responsibility for selecting the means for performing, including ensuring worker safety.The trial court concluded DOT was not liable for Decedent’s death as a matter of law because DOT delegated to Jones its duty to provide a safe work environment and the conduct of the drunk driver was not reasonably foreseeable. The court of appeal affirmed, rejecting arguments that admissible evidence was wrongfully excluded. Plaintiffs failed to present evidence that DOT retained control over the construction site and actually exercised that control in such a way as to affirmatively contribute to Decedent's injuries, as required under California law. View "Marin v. Department of Transportation" on Justia Law

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JSC, the property owner, hired Cahill as the general contractor on the residential rehabilitation project. Cahill hired Janus as a subcontractor for demolition work. Degala was a Janus employee. The project site was in a known high-crime area. The contract between JSC and Cahill required Cahill to “take reasonable precautions for the safety of, and ... provide reasonable protection to prevent damage, injury or loss to ... employees on the work and other persons.” The subcontract between Cahill and Janus provided that Janus’s scope of work excluded “[s]ite security,” and that Janus was “responsible for securing [its] own tools and equipment.” Janus agreed to comply with Environmental, Health & Safety guidelines.Degala was attacked and seriously injured by unknown assailants while working at the site, He sued JSC and Cahill, alleging that they breached their duty to take reasonable security precautions. The trial court entered summary judgment, finding Degala’s claims barred by the “Privette doctrine,” under which the hirer of an independent contractor is not liable for on-the-job injuries sustained by the contractor’s employees; the court rejected Degala’s argument that defendants could be liable under the “Hooker exception,” which applies when the hirer retains control over any part of the contractor’s work and exercises that control in a way that affirmatively contributes to the plaintiff’s injury. The court of appeal reversed, finding triable issues of fact as to whether the defendants are liable under a retained control theory. View "Degala v. John Stewart Co." on Justia Law

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Plaintiff and appellant, a contractor, prevailed in an arbitration against its client, the Defendant and Respondent. After finding that Plaintiff was not duly licensed because its responsible managing employee (RME) did not meet the criteria required by law, the trial court granted Defendant's petition to vacate the arbitration award on the ground that the arbitrator exceeded her powers.Plaintiff made two main arguments on appeal. It first contends the trial court misapplied the burden of proof regarding whether Plaintiff was a duly licensed contractor. The Second Appellate District rejected this argument, finding that the trial court correctly determined that Plaintiff had the burden of proof on this issue.Plaintiff also argued the trial court erroneously denied it an evidentiary hearing. In the trial court, however, Plaintiff did not seek an evidentiary hearing. It instead argued that such a hearing was not authorized by law. Therefore, the Second Appellate District held that Plaintiff forfeited the issue on appeal. View "Vascos Excavation Group LLC v. Gold" on Justia Law

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Defendant Department of General Services and real party Joint Committee on Rules of the California State Senate and Assembly (collectively DGS) prepared an environmental impact report (EIR) to determine the environmental effects of a project they proposed which would significantly affect the California State Capitol Building in Sacramento (Historic Capitol). DGS would demolish the State Capitol Building Annex attached to the Historic Capitol and replace it with a larger new annex building, construct an underground visitor center attached to the Historic Capitol’s west side, and construct an underground parking garage east of the new Annex. Plaintiffs Save Our Capitol! and Save the Capitol, Save the Trees filed petitions for writ of mandate contending the EIR did not comply with the California Environmental Quality Act (CEQA). The trial court denied the petitions. Plaintiffs appealed the judgment, arguing: (1) the EIR lacked a stable project description; (2) the EIR did not adequately analyze and mitigate the project’s impacts on cultural resources, biological resources, aesthetics, traffic, and utilities and service systems; (3) the EIR’s analysis of alternatives to the project was legally deficient; and (4) DGS violated CEQA by not recirculating the EIR a second time before certifying it. The Court of Appeal reversed in part, finding the EIR’s project description, analyses of historical resources and aesthetics, and analysis of alternatives did not comply with CEQA. Judgment was affirmed in all other respects. View "Save Our Capitol! v. Dept. of General Services" on Justia Law

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Plaintiff-appellant Chris LaBarbera hired Richard Knight dba Knight Construction (Knight) to remodel a house pursuant to a contract that provided Knight would defend and indemnify LaBarbera for all claims arising out of the work. Knight obtained a general liability insurance policy from defendant-respondent Security National Insurance Company (Security National) that covered damages Knight was obligated to pay due to bodily injury to a third party. As relevant here, the policy also covered Knight’s “liability for damages . . . [a]ssumed in a contract or agreement that is an ‘insured contract.’ ” Security National acknowledged the indemnity provision in Knight’s contract with LaBarbera was an “insured contract” within the meaning of the policy. The policy also provided, “If we defend an insured [i.e., Knight] against a suit and an indemnitee of the insured [i.e., LaBarbera] is also named as a party to the suit, we will defend that indemnitee” if certain conditions were met. During the remodeling work, a subcontractor suffered catastrophic injuries, and sued both LaBarbera and Knight. LaBarbera’s liability insurer (plaintiff-appellant Lloyd's of London Underwriters) defended him in that lawsuit, and Security National defended Knight. LaBarbera also tendered his defense to Knight and to Security National, but they either ignored or rejected the tender. After settling the underlying lawsuit for $465,000, LaBarbera and Underwriters sued Knight and Security National, seeking to recover the full $465,000 settlement amount and over $100,000 in expenses and attorney fees incurred defending LaBarbera in that lawsuit. Security National moved for summary judgment on the ground that all claims against it were barred because the undisputed facts established it did not have an obligation to defend or indemnify LaBarbera. The trial court granted the motion and entered judgment in favor of Security National. LaBarbera and Underwriters appealed, but the Court of Appeal affirmed, adopting different reasoning than the trial court. The Court agreed with Security National that the indemnitee defense clause in Knight’s general liability insurance policy did not bestow third party beneficiary rights on the indemnitee, LaBarbera, who benefitted only incidentally from the clause. Because LaBarbera was not a third party beneficiary under Knight’s policy, he was precluded from bringing a direct action against Security National. View "LaBarbera, et al. v. Security Nat. Ins. Co." on Justia Law

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Vought sued for the balance due on his contract for the renovation of Stock’s house, additional compensation under a disputed change order, and penalties for the violation of a prompt-payment statute, Civil Code section 8800. Stock did not dispute the unpaid amount Vought had earned for finished work, including approved change orders, but disputed the claim for additional compensation and sought liquidated damages for delay. The court held that Vought was entitled to the undisputed balance due plus approximately half the disputed amount of additional compensation; that Stock was entitled to approximately half the amount he claimed as liquidated damages; and that Stock had not violated section 8800 by withholding final payment. The court held that neither side was entitled to attorney fees under section 8800 or to costs under Code of Civil Procedure section 1032.The court of appeal affirmed in part. Stock was not prohibited from withholding the $79,000 otherwise due based on his good faith claim for liquidated damages. Vought was not relieved of the obligation to pay liquidated damages for the delay that it caused although it was not responsible for the entire delay. Neither party was the prevailing party under section 8800 but Vought was the prevailing party for purposes of recovering costs under section 1032; it secured a “net monetary recovery.” View "Vought Construction Inc. v. Stock" on Justia Law

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Plaintiffs Lynn Gerlach and Lola Seals appealed the judgment entered in their action against defendant K. Hovnanian’s Four Seasons at Beaumont, LLC under the Right to Repair Act (the Act), concerning alleged construction defects. After review, the Court of Appeal affirmed and published its opinion to clarify: (1) a roof is a manufactured product within the meaning of California Civil Code section 896(g)(3)(A) only if the roof is completely manufactured offsite; and (2) to prove a roof defect claim under subdivision (a)(4) or (g)(11) of section 896, a plaintiff must prove that water intrusion has actually occurred or roofing material has actually fallen from the roof. View "Gerlach v. K. Hovnanian's Four Seasons at Beaumont, LLC" on Justia Law

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The owners purchased the property in a wooded area of Los Gatos to build a home. They sought to remove some trees, including a large eucalyptus tree that straddled the property line, not realizing that the eucalyptus was partially on the neighbor’s property and that they needed her permission to remove it. They assumed they could remove the eucalyptus because they had received permits from the county. The owners’ general contractor, TWA, hired a subcontractor for tree trimming. The subcontractor damaged the eucalyptus tree.The neighbor sued. The owners filed a cross-complaint against TWA for comparative negligence, breach of contract, express contractual indemnity, equitable indemnity, and other claims. TWA filed a cross-complaint against the owners, alleging breach of contract and other claims. At trial, the owners and TWA settled the suit with the neighbor. The suits involving their cross-complaints continued. TWA presented no evidence that the subcontractor who worked on the eucalyptus was licensed for tree trimming work.The court of appeal affirmed that TWA was 100 percent at fault for the neighbor’s damages and had been paid $10,000 for the tree trimming services performed by the subcontractor. The court rejected arguments that the trial court erred in interpreting the licensing statute, Business and Professions Code section 7031.3, and misinterpreted the construction agreement. View "Kim v. TWA Construction, Inc." on Justia Law

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Panterra GP, a licensed general contractor, sued the defendants, seeking more than $2,609,666 for work it allegedly performed on a construction project. The contract between the parties mistakenly referred to Panterra Development, an entity that is not a licensed contractor. Panterra GP, the general partner in Panterra Development, actually performed the remodeling work at issue. The Bakersfield permit applications, building permits, and certificate of occupancy correctly referred to Panterra GP as the contractor. The action was dismissed without leave to amend, based on Business and Professions Code section 7031(a); the court stated that a party may not rely on equitable principles to reform a contract in order to overcome the failure of the party identified in the construction contract as the contractor to have a valid contractor’s license as required by the statute.The court of appeal vacated. Section 7031(a) has no applicability to claims asserted by Panterra GP because it was licensed as a contractor at all relevant times. The defendants tried to argue, before trial, that Panterra Development was the true contractor, but that contention was untenable at the pleadings stage. Courts may not turn a demurrer into a contested evidentiary matter by determining the “proper interpretation” of the evidence. View "Panterra GP, Inc. v. Superior Court" on Justia Law

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The Sellers bought an Oakland property to “flip.” After Vega renovated the property, they sold it to Vera, providing required disclosures, stating they were not aware of any water intrusion, leaks from the sewer system or any pipes, work, or repairs that had been done without permits or not in compliance with building codes, or any material facts or defects that had not otherwise been disclosed. Vera’s own inspectors revealed several problems. The Sellers agreed to several repairs Escrow closed in December 2011, but the sewer line had not been corrected. In January 2012, water flooded the basement. The Sellers admitted that earlier sewer work had been completed without a permit and that Vega was unlicensed. In 2014, the exterior stairs began collapsing. Three years and three days after the close of escrow, Vera filed suit, alleging negligence, breach of warranty, breach of contract, fraud, and negligent misrepresentation. Based on the three-year limitations period for actions based on fraud or mistake, the court dismissed and, based on a clause in the purchase contract, granted SNL attorney’s fees, including fees related to a cross-complaint against Vera’s broker and real estate agent.The court of appeal affirmed. Vera’s breach of contract claim was based on fraud and the undisputed facts demonstrated Vera’s claims based on fraud accrued more than three years before she filed suit. Vera has not shown the court abused its discretion in awarding fees related to the cross-complaint. View "Vera v. REL-BC, LLC" on Justia Law