Justia Construction Law Opinion Summaries

The Supreme Court affirmed the decision of the court of appeals and the district court on the questions of lien validity and priority in this mechanics' lien case, holding that there was no error.Law requires that general contractors and owner-builders post a notice of commencement of work to Iowa's centralized, internet-based registry for mechanics' liens within ten days of starting work on a residential construction project. In the instant case, the owner-builder did not post notices of commencement on the registry for the five residential lots that it was developing, but two subcontractors did so several months after construction had begun. When the project went into default, a priority dispute arose between the two subcontractors and the project's commercial lender. The district court and court of appeals found for the subcontractors. The Supreme Court affirmed, holding (1) Iowa Code 572.13 did not change the principle that mechanics' liens will, in some circumstances, have priority over previously-recorded mortgages; and (2) the ten-day deadline for posting the notice of commencement to the registry applies to general contractors and owner-builders but not to subcontractors. View "Borst Brothers Construction, Inc. v. Finance of America Commercial, LLC" on Justia Law

Cal-Am, a developer and operator of RV and mobile-home parks leased the Yuma Sundance RV Resort from its owner, intending to construct a new banquet and concert hall on the property. The property owner provided the funding for the construction. Cal-Am managed the project. Cal-Am hired a contractor, Nickle, to design and construct the hall, who then hired Edais Engineering to survey the property and place construction stakes to mark the Hall’s permitted location. No contract existed between Edais and Cal-Am. Edais acknowledges that its placement of the stakes was defective. Cal-Am was forced to adjust its site plan, eliminating eight RV parking spaces. Cal-Am sued Edais for claims including negligence. The trial court granted Edais summary judgment on the negligence claim finding that Cal-Am could not recover its purely economic damages. The court of appeals affirmed.The Arizona Supreme Court affirmed, repudiating its 1984 Donnelly Construction holding that a design professional’s duty to use ordinary skill, care, and diligence in rendering professional services extends both to persons in privity with the professional and to persons foreseeably affected by a breach of that duty. Under Arizona’s current framework, which repudiated foreseeability as a basis for duty, design professionals lacking privity of contract with project owners do not owe a duty to those owners to reimburse purely economic damages. View "Cal-Am Properties, Inc. v. Edais Engineering, Inc." on Justia Law

Blue Appaloosa, Inc., appealed a judgment affirming an Industrial Commission order determining it violated N.D. Admin. Code ch. 43-02-03 by beginning construction of a treating plant prior to obtaining a permit or filing a bond with the Commission. Finding no reversible error, the North Dakota Supreme Court affirmed. View "Blue Appaloosa v. NDIC" on Justia Law

In federal court, Plaintiff Timothy Martin sued the Department of Corrections (DOC) and three DOC-employed medical providers, alleging Eighth Amendment to the United States Constitution violations under 42 U.S.C. 1983, and medical malpractice under state law. Following the defendants’ motion for summary judgment, the federal district court certified three questions of Washington state law to the Washington Supreme Court, all relating to whether RCW 7.70.150’s requirement of a certificate of merit for medical malpractice suits against state agents was constitutional. The Washington Court held that RCW 7.70.150 was invalid on its face based on Putman v. Wenatchee Valley Med. Ctr., PS, 216 P.3d 374 (2009), and on statutory language that did not differentiate between private and public defendants. Because the Supreme Court answered certified question 1 in the affirmative, it did not reach the federal court's remaining questions. View "Martin v. Dep't of Corrections" on Justia Law

The Supreme Court affirmed the judgment of the district court dismissing Plaintiff's complaint against the State alleging that Nevada's system of public education had failed its students, holding that Plaintiff's claims were nonjusticiable.Appellants - nine parents of students attending public schools in the districts of Clark, Washoe, and White Pine Counties - sued State education agencies and officials alleging that Nevada's system of public education failed to achieve the standards that she argued were required for a sufficient, basic education under Nev. Const. art. 11, 1,2 and 6. In dismissing the complaint, the district court determined that the claims presented nonjusticiable political questions. The Supreme Court affirmed, holding that Appellants' complaint did not present justiciable questions appropriate for adjudication. View "Shea v. State" on Justia Law

Koch Construction, Inc.; Marilyn Koch, Personal Representative of the Estate of Michael P. Koch; and Koch Property Investments, Inc. (collectively “appellants”) appealed the judgment and amended judgment entered in favor of Toman Engineering Company (“Toman”). Michael Koch owned and operated Koch Construction and Koch Property Investments (“KPI”). Toman provided engineering services to Koch Construction on various projects, including designing a stormwater management system for the Koch Meadow Hills residential development project in Dickinson, North Dakota. Michael died in August 2017. The stormwater management system included a detention pond referred to as the Marilyn Way Stormwater Pond, which was the detention pond at issue in this case. In 2016, Janet Prchal, Dean Kubas, and Geraldine Kubas, owners of property near the Koch Meadow Hills development, sued the City of Dickinson and KPI for damages, alleging the development of Koch Meadow Hills caused water to drain and collect on their properties. The Prchal lawsuit was settled in September 2018, and the settlement required modifications to be made to the Marilyn Way Stormwater Pond before June 30, 2019. The reconstruction work on the detention pond occurred during the summer and fall of 2019. Toman served a summons and complaint on Koch Construction and Marilyn Koch, to collect unpaid amounts for engineering services Toman provided to the defendants in 2017. Toman filed the complaint in the district court in June 2019. The appellants argued the district court erred in deciding they committed intentional spoliation of evidence and dismissing their counterclaim as a sanction. After review of the district court record, the North Dakota Supreme Court concluded the district court abused its discretion when it dismissed the appellants’ counterclaim as a sanction for spoliation of evidence. Judgment was reversed and the matter remanded for a new trial. View "Toman Engineering Co. v. Koch Construction, et al." on Justia Law

In this case arising out of a construction contract dispute involving competing claims of breach between the owner and the contractor, the Supreme Court reversed in part the court of appeals' judgment affirming the portion of the trial court's judgment awarding damages to the owner but reversing as to the contractor, holding that the judgment awarding certain expenses to the owner could not stand.The jury found that both the owner and the contractor breached the contract and awarded damages as to both parties. At issue was whether the owner's entitlement to recover contract damages associated with a termination of the contractor for default hinged on strict compliance with the written-notice conditions precedent to such recovery, whether sufficient evidence supported the jury's finding of compliance, and whether a contractual provision governing consequential damages was liability waiver or a covenant not to sue. The Supreme Court held (1) when a contract mandates written notice, a writing is a necessary part of complying with contractual notice conditions, substantially or otherwise; (2) because the owner failed to provide the requisite written notices to be entitled to recover expenses associated with a termination for default, the judgment awarding them to the owner could not stand; and (3) the contract did not contain a covenant not to sue for consequential damages. View "James Construction Group, LLC v. Westlake Chemical Corp." on Justia Law

The Supreme Court reversed the judgment of the trial court finding Plaintiffs responsible for failing to complete a project by the parties' agreed-upon deadline and awarding Defendant $335,000 in liquidated damages on its counterclaim, holding that the trial court's pretrial interpretation of various agreements between the parties was erroneous.At issue was which party was responsible for delays in constructing Dunkin Donuts Park in the City of Hartford. Plaintiffs, the project's developer and the design-builder, sued the City claiming breach of contract, and the City counterclaimed for breach of contract. The trial court concluded, as a matter of law, that Plaintiffs controlled the architect and were therefore liable for changes to and mistakes in the ballpark's design. Thereafter, the jury found Plaintiffs responsible for failing to complete the stadium by the agreed-upon deadline. The Supreme Court reversed, holding that the parties' contracts did not unambiguously grant Plaintiffs legal control of the architect and the stadium's design across all relevant time periods. View "Centerplan Construction Co. v. Hartford" on Justia Law

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

The Supreme Court affirmed the decision of the district court determining that the covenant of good faith and fair dealing applied when it awarded delay damages to a subcontractor, holding that the district court properly determined that the covenant of good faith and fair dealing applied and that the contractor breached the covenant.At issue on appeal was (1) whether the district court properly applied the covenant of good faith and fair dealing when it awarded delay damages to a subcontractor, and (2) whether the subcontractor waived its right to receive delay damages by signing a waiver and release to receive its retention. The Supreme Court held (1) the covenant of good faith and fair dealing allowed for the subcontractor to receive delay damages; and (2) the conditional release and waiver the subcontractor signed did not preclude it from receiving delay damages. View "APCO Construction, Inc. v. Helix Electric of Nev., LLC" on Justia Law