Justia Construction Law Opinion Summaries

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

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

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

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

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

A real estate developer, 3534 East Cap Venture, LLC, and a construction company, McCullough Construction, LLC, were involved in a dispute with their insurers, Westchester Fire Insurance Company and Endurance American Insurance Company. The dispute centered around the coverage of two identical builders’ risk insurance policies for a residential and retail complex under construction in the District of Columbia. During construction, the absence of a vapor barrier in the architect's plans led to the condensation of vapor into water during cold weather, causing nearly $1.5 million in damages. The insurers denied the claims, arguing that the policies excluded losses caused by atmospheric dampness or temperature changes.The case was initially brought to the Superior Court of the District of Columbia, but was moved to federal district court due to diversity of citizenship. The district court ruled in favor of the insurers, holding that the exclusions for losses caused by "dampness of atmosphere" or "changes in temperature" applied. The court also held that the ensuing-loss exception to the exclusions did not apply because losses from "water damage" to the building were "inextricably intertwined" with—and indeed were "one and the same" as—losses covered by the dampness and temperature exclusions.The United States Court of Appeals for the District of Columbia Circuit reversed the district court's decision. The appellate court held that the ensuing-loss clause in the insurance policies applied to losses from water damage caused by the excluded perils of dampness and temperature changes. Therefore, the policies covered the losses at issue. The court remanded the case with instructions to enter summary judgment for the insureds on the question of liability. View "3534 East Cap Venture, LLC v. Westchester Fire Insurance Company" on Justia Law

Summit Construction filed a lawsuit against Jay Koontz and Jennie L. Kennette for breach of contract and unjust enrichment, alleging nonpayment for work performed on Mr. Koontz’s home based on an oral agreement. The work included an addition to the home and extensive renovations to the existing structure. The District Court rejected both claims, determining that there was no enforceable oral contract between the parties and that Summit did not sufficiently prove its damages for the unjust enrichment claim.The District Court found that the parties had not mutually agreed to sufficiently definite terms for an oral contract. The court noted that the project progressed without a clear understanding of the scope of work, how it would be paid for, and who would be responsible for payment. The court also found that Summit's invoices did not clearly define the terms of the contract. Furthermore, the court concluded that Summit had failed to prove the amount by which Mr. Koontz was unjustly enriched, i.e., its damages.Upon appeal, the Supreme Court of Wyoming affirmed the District Court's decision. The Supreme Court agreed that Summit had failed to show the existence of an enforceable oral contract with either Mr. Koontz or Ms. Kennette. The court also agreed with the lower court's finding that Summit had failed to establish its damages to a reasonable degree of certainty, which is necessary for an unjust enrichment claim. View "Summit Construction v. Koontz" on Justia Law

A general contractor, Graycor Construction Company Inc., was involved in a dispute with a subcontractor, Business Interiors Floor Covering Business Trust, over unpaid invoices for flooring work performed on a movie theater project. Business Interiors submitted three separate applications for periodic payments, which Graycor neither approved nor rejected within the time limit set by the Prompt Pay Act. As a result, the applications were deemed approved under the Act. Business Interiors sued Graycor for breach of contract and other claims in the Superior Court. The Superior Court granted Business Interiors's motion for summary judgment on its breach of contract claim and entered separate and final judgment. Graycor appealed.Graycor argued that the original contract was not a "contract for construction" within the meaning of the Act, and that it had a valid impossibility defense due to its failure to pay. The Supreme Judicial Court held that the Act defines its scope broadly, and the subcontract at issue was a "contract for construction" under the Act. The Court also held that common-law defenses are not precluded by the Act, but a contractor that does not approve or reject an application for payment in compliance with the Act must pay the amount due prior to, or contemporaneous with, the invocation of any common-law defenses in any subsequent proceeding regarding enforcement of the invoices. As Graycor sought to exercise its defenses without ever paying the invoices, it could not pursue the defenses. The Court also vacated and remanded the rule 54 (b) certification to the motion judge for reconsideration. View "Business Interiors Floor Covering Business Trust v. Graycor Construction Company Inc." on Justia Law

The Supreme Court of the State of Colorado was asked to review a case involving a dispute between the City of Aspen and the Burlingame Ranch II Condominium Owners Association, Inc. The dispute centered around alleged construction defects in an affordable housing project overseen by the City of Aspen. The Association claimed that Aspen had breached express and implied warranties, and Aspen argued that the claims were barred by the Colorado Governmental Immunity Act (CGIA), which provides immunity to public entities from claims for injury that lie in tort or could lie in tort.The lower court agreed with Aspen, ruling that the Association's claims sounded in tort, or could sound in tort, and were thus barred by the CGIA. The Association appealed, and the Colorado Court of Appeals reversed the lower court's decision. The appellate court reasoned that the Association's claims could only sound in contract, and thus were not barred by the CGIA. The court relied on the economic loss rule, which generally provides that a party suffering only economic loss from the breach of a contractual duty may not assert a tort claim for such a breach absent an independent duty of care under tort law.The Supreme Court of the State of Colorado reversed the appellate court's decision. The court held that the economic loss rule has no bearing on whether the CGIA bars a plaintiff’s claims. The court clarified that the CGIA bars claims that could arise in both tort and contract, and that the economic loss rule cannot rescue an otherwise CGIA-barred claim. The case was remanded back to the lower court for further proceedings. View "City of Aspen v. Burlingame Ranch II" on Justia Law

Jake Johnson, an electrician, was injured while working on a construction project in a building owned by Property Reserve, Inc. (PRI) and managed by CBRE. Johnson was employed by PCF Electric, a subcontractor hired by Crew Builders, the general contractor for the project. Johnson filed a complaint against PRI, CBRE, Crew, and PCF for damages. PRI and CBRE 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 PRI and CBRE hired Crew for the project.The trial court's decision was based on the execution date of the written contract between PRI, CBRE, and Crew. The court found that there was a triable issue of fact as to when PRI and CBRE hired Crew for the project. The court also granted Crew’s and PCF’s motions for summary judgment, concluding that the Privette doctrine barred Johnson’s claims against them.The Court of Appeal, Fourth Appellate District Division One, disagreed with the trial court's decision. The appellate court found that a written contract is not required to invoke the Privette doctrine, and the undisputed facts established that PRI and CBRE 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 no triable issues of material fact precluded summary judgment and granted PRI and CBRE’s requested relief. View "CBRE v. Superior Court" on Justia Law