Justia Construction Law Opinion Summaries

A construction company solicited a bid from a subcontractor to perform concrete work. The construction company provided a plan and bid schedule. The subcontractor responded with a proposal, which the construction company accepted. The subcontractor carried out the subcontract as it understood the terms. After the work was completed, the subcontractor discovered it had inadvertently underbid on the project. In the ensuing lawsuit, the superior court granted partial summary judgment to the construction company with respect to all damages claimed in relation to the bidding error. The subcontractor appealed the partial summary judgment order, claiming breach of an implied warranty that the plans and specifications would be sufficient, and arguing that the superior court erred by applying the theory of unilateral mistake to the case. Because the construction company did not breach the implied warranty and the subcontractor committed a unilateral mistake for which it bore the risk, the Supreme Court affirmed. View "Handle Construction Co., Inc. v. Norcon, Inc." on Justia Law

The issue before the Tenth Circuit in this case centered on whether property damage caused by a subcontractor's faulty workmanship is an "ocurrence" for purposes of a commercial general liability (CGL) insurance policy. The issue arose from the appeals of Plaintiffs-Appellants Greystone Construction, Inc., The Branan Company, and American Family Mutual Insurance Company (American) who all appealed the district court’s grant of summary judgment in favor of Defendant National Fire & Marine Insurance Company (National). Greystone was the general contractor that employed multiple subcontractors to build a house in Colorado. As is common along Colorado’s front range, the house was built on soils containing expansive clays. Over time, soil expansion caused the foundation to shift, resulting in extensive damage to the home’s living areas. The homeowners sued Greystone for damages, alleging defective construction by the subcontractors who installed the foundation. Greystone was insured under CGL policies provided by two insurers. American provided policies for 2001 to 2003, and National provided policies for 2003 to 2006. The American and National policy periods did not overlap. Greystone tendered a claim to American and then National. National denied it owed Greystone any defense. In district court, the builders and American sought to recover a portion of their defense costs from National. Upon review, the Tenth Circuit concluded that damage arising from a poor workmanship may fall under a CGL policy’s initial grant of coverage, even though recovery may still be precluded by a business-risk exclusion or another provision of the policy. The case was remanded to the district court for further proceedings. View "Greystone Construction v. National Fire & Marine" on Justia Law

David and Kristine Anderson purchased an undeveloped lot of land from Country Living Development. After constructing a home on the lot, the Andersons' home developed structural problems resulting from excessive settling caused by unstable soil beneath their home's foundation. The Andersons filed suit against Matthew Kriser, an employee and shareholder of Country Living, for fraudulent nondisclosure. The district court granted summary judgment in favor of Kriser. The court of appeals affirmed. The Supreme Court affirmed, holding (1) the court of appeals correctly concluded that a plaintiff must demonstrate that a defendant had actual knowledge of undisclosed information to satisfy the elements of a claim for fraudulent disclosure; (2) because the Andersons failed to set forth any evidence demonstrating that Kriser actually knew of the soil conditions below their home, summary judgment was proper; and (3) the court of appeals erred in relying on the Court's holding in Smith v. Frandsen to reach its conclusion that the law imposed no duty on Kriser to disclose information to the Andersons simply because he did not construct their home. View "Anderson v. Kriser" on Justia Law

Defendant contractor entered into a contract to replace a roof. When the newly installed roof developed leaks, Defendant hired an independent contractor to make repairs. While performing the work, the independent contractor caused a fire, resulting in a large insurance claim by the homeowners. As subrogor to the homeowners' rights and claims arising out of the fire, Plaintiff insurance company sued Defendant in tort and contract. The trial court granted Defendant's motion for summary judgment on all claims, finding that because Defendant had subcontracted the work, he could not be liable. The court of appeals reversed. The Supreme Court affirmed, holding that Defendant had an implied non-delegable duty to install the roof in a careful, skillful, diligent, and workmanlike manner. Remanded. View "Fed. Ins. Co. v. Winters " on Justia Law

CLR Properties and Choice Land Corporation (collectively, CLR) hired Waynco Construction (Waynco) as the general contractor for a commercial real estate improvement project. Waynco solicited a bid from AAA Construction of Missoula (AAA) to perform concrete work. After AAA submitted its bid, Waynco used AAA's bid to formulate Waynco's general contract bid to CLR. CLR accepted Waynco's bid. While AAA completed a majority of the work outlined in its bid by the time it left the project, a dispute arose between Waynco and AAA about the parties' subcontract agreement. Waynco eventually failed to pay AAA for any labor or materials. AAA filed a complaint against CLR and Waynco, alleging that Waynco had breached the contract and CLR had been unjustly enriched from AAA's work. The district court granted CLR's motion for summary judgment on the unjust enrichment claims and, after a trial, held for AAA. The Supreme Court affirmed, holding (1) the district court properly concluded that AAA's bid constituted a binding contract between the parties; (2) substantial evidence supported the district court's conclusion that Waynco was the materially breaching party; and (3) the district court properly denied CLR's claim for attorney fees. View "AAA Constr. of Missoula, LLC v. Choice Land Corp." on Justia Law

In 1999 plaintiff pled guilty to making false statements while working on a project funded by the Federal Highway Administration (18 U.S.C. 2, 1014, and 1020). The agreement prohibited plaintiff from participating in any FHWA-funded project for a year. Plaintiff challenged Puerto Rico agencies' subsequent actions. The parties negotiated settlements; plaintiff entered into an agreement allowing it to bid on FHWA projects. Puerto Rico then enacted Law 458, which prohibits award of government contracts to any party convicted of a crime constituting fraud, embezzlement, or misappropriation of public funds and requires rescission of any contract with a party convicted of a specified offense. The statute states that it does not apply retroactively. One agency cancelled plaintiff's successful bids, another withdrew its consent to the settlement. The district court rejected claims of violation of the federal Contracts Clause and breaches of contract under Puerto Rico law. The First Circuit affirmed with respect to the constitutional claim. Any breach of the settlement agreements did not violate the Contracts Clause, even if committed in an attempt to unlawfully enforce Law 458 retroactively; defendants have not impaired plaintiff's ability to obtain a remedy for a demonstrated breach. Given the stage of the litigation, the district court should have retained the breach of contract claims. View "Redondo Constr. Corp. v. Izquierdo" on Justia Law

Plaintiff, an unlicensed subcontractor, filed a complaint against Defendants, licensed contractors, alleging that it was entitled to a judgment in the amount that Defendants agreed to pay for home improvement work that Plaintiff performed as a subcontractor for Defendants. The circuit court dismissed the complaint, finding that contracts made by unlicensed home improvement contractors or subcontractors were illegal. The court of appeals reversed and reinstated the complaint, holding that the Maryland Home Improvement Law, which regulates contracts between contractors and owners, did not bar Respondent from recovering on its subcontract with Petitioner. The Supreme Court affirmed, holding that the Maryland Home Improvement Law did not render unenforceable a contract between a home improvement general contractor and an unlicensed subcontractor. View "Stalker Bros. v. Alcoa Concrete Masonry, Inc. " on Justia Law

Town & Country Property, L.L.C., and Town & Country Ford, L.L.C. (T&C), sued Amerisure Insurance Company and Amerisure Mutual Insurance Company (Amerisure) and its insured, Jones-Williams Construction Company, Inc., alleging that Amerisure was obligated to pay a $650,100 judgment entered in favor of T&C and against Jones-Williams in a separate action pursuant to a commercial general-liability insurance policy Amerisure had issued Jones-Williams. The trial court entered a summary judgment in favor of Amerisure, and T&C appealed. Specifically, the trial court held that Amerisure was not required to indemnify Jones-Williams because there had been no occurrence invoking coverage under the policy. Upon review, the Supreme Court affirmed the trial court's judgment to the extent the awarded damages represented the costs of repairing or replacing faulty work covered under the liability policy. The Court remanded the case to the trial court so that it could consider arguments from the parties to determine if any of the damages awarded represented compensation for damaged property. View "Town & Country Property, L.L.C.v. Amerisure Ins. Co." on Justia Law

This case was an interlocutory appeal from a circuit court which granted the "Motions to Compel Arbitration" of Pass Marianne, LLC (Pass) and Alfonso Realty, Inc. (Alfonso). On appeal, the Supreme Court considered: (1) whether Pass waived its right to arbitration, and (2) whether a principal’s waiver of its contractual right to arbitrate operates to waive that right for its agent. In 2005, Pass entered into a contract with Carl E. Woodward, LLC (Woodward) for the construction of a new condominium development, Pass Marianne Condominiums, in Pass Christian, Mississippi. In February, Pass and Lemon Drop Properties, LLC (Lemon Drop) entered into a "Preconstruction Sales and Purchase Agreement" for Unit No. 209 within the Pass Marianne Condominiums. Because of Hurricane Katrina, construction of the Pass Marianne Condominiums was not completed until 2007. On October 3, 2007, Pass executed a warranty deed conveying Unit No. 209 to Lemon Drop, and Woodward furnished a "Warranty of Completion of Construction" to Lemon Drop. On October 28, 2008, Lemon Drop filed a Complaint in the circuit court against Pass and Woodward, which sought, inter alia, rescission of the Agreement due to alleged defects in design and construction. Upon review, the Supreme Court concluded that while Pass waived its right to compel arbitration, that waiver was not imputed to its agent, Alfonso. As there was no evidence of waiver by Alfonso, it should have been entitled to proceed in arbitration. Therefore, as to Alfonso the Court affirmed the circuit court's order granting arbitration was affirmed. But regarding Pass, Court reversed and remanded the circuit court's order for further proceedings. View "Lemon Drop Properties, LLC. v. Pass Marianne, LLC" on Justia Law

Ronald Bacon was injured while working at a construction site. Bacon sued the general contractor, the general contractor's commercial liability insurer, the subcontractor, and the parent company of the subcontractor. Bacon settled with the insurer, which together with the general contractor's separate liability insurer, made payments to Bacon pursuant to the settlement agreement. After Bacon settled with the subcontractor's parent company, the general contractor's two insurers filed a breach of contract action because Bacon received the proceeds of his second settlement but refused to make payment to the insurers under the terms of the first settlement agreement. The district court granted summary judgment for the insurers, finding Bacon, his lawyer, and the lawyer's law firm liable in the amount of $437,500. The Supreme Court reversed the district court's finding that lawyer and law firm were personally liable on the contract, holding that an attorney and/or law firm is not liable on a contract negotiated on behalf of a client when the contract provides that both the client and the attorney "agree to and will pay" a certain sum of money and the attorney signs the contract under the legend "Agreed to in Form & Substance". The Court otherwise affirmed. View "RSUI Indemnity Co. v. Bacon" on Justia Law