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

The Supreme Court reversed the judgment of the district court granting Defendant's motion to suppress physical evidence and statements based on a police officer's alleged promise of leniency, holding that there was no improper promise of leniency.The officer at issue initiated a Terry stop on a public stop after observing Defendant make a possible drug buy. The officer told Defendant if he cooperated he would not be arrested that day but may be arrested later. Three months after Defendant handed over crack cocaine and marijuana the officer charged him with possession. The trial court granted Defendant's motion to suppress, concluding that the evidence obtained after the officer promised leniency was fruit of the poisonous tree. The Supreme Court reversed, holding that the officer did not improperly promise leniency. View "State v. Hillery" on Justia Law

In this construction law case, the Supreme Court reversed the order of the circuit court granting summary judgment in favor of Appellee, holding that Appellee was not entitled to claim preclusion or issue preclusion even though the federal court found in Appellee favor in a parallel federal case.The dispute in this case arose out of a contract between two subcontractors in a construction project. In the federal case, subcontracting parties litigated questions related to the fabrication of the salt conveyor system. The federal district court ruled in favor of Appellee. Appellant filed a second lawsuit in state court against subcontractors involved in the federal case. Appellee filed a motion for summary judgment, arguing that the judgment in the federal litigation compelled judgment in its favor in the state court litigation. The district court granted summary judgment for Appellee on both claim preclusion and issue preclusion. The Supreme Court reversed, holding (1) under Noel v. Noel, 334 N.W.2d 146 (Iowa 1983), and Pagel v. Notbohm, 186 N.W.2d 638 (Iowa 1971), Appellee waived its claim preclusion argument; and (2) that the state district court ruling took too broad an approach to what the "issue" was in the federal lawsuit. View "Lemartec Engineering & Construction v. Advance Conveying Technologies, LLC" on Justia Law

In this dispute over Contractor's attorney fees the Supreme Court affirmed the judgment of the district court finding that Homeowners waived their assertion that including attorney fees in a mechanic's lien foreclosure decree violated their homestead rights, holding that Homeowners needed to raise their homestead exemption before the district court entered the foreclosure decree.This appeal stemmed from a judicial determination that Homeowners had to pay most of Contractor's unpaid bill and that Contractor was entitled to foreclosure of its mechanic's lien. Later, a revised decree was entered granting Contractor the right to foreclose a mechanic's lien against the property both for the principal amount due and for the attorney fees. When a second sheriff's sale of the residence was impending, Homeowners, for the first time, asserted that including attorney fees in the mechanic's lien foreclosure decree violated their homestead rights. The judicial court found a waiver by Homeowners. The Supreme Court affirmed, holding (1) attorney fees can be recovered in a mechanic's lien foreclosure action against the homestead; and (2) the district court correctly found that principles of res judicata and waiver barred Homeowners' assertion of a homestead exemption. View "Standard Water Control Systems, Inc. v. Jones" on Justia Law

The Supreme Court affirmed the ruling of the district court holding that mechanic's liens arising from the provision of materials and labor to a lessee did not attach to the property of the lessor under the circumstances of this case and that a construction mortgage lien ultimately obtained by the owner of the land on the leasehold and property of the lessee had prior over the later-filed mechanic's liens, holding that the district court's judgment was without error.Specifically, the Court held (1) the legislature has reworked Iowa Code 572.2 to limit mechanic's liens to property belonging to a narrowly defined owner, and therefore, Denniston & Patridge Co. v. Romp, 56 N.W.2d 601 (Iowa 1953), and Stroh Corp. v. K&S Development Corp., 247 N.W.2d 750 (Iowa 1976), are no longer good law; (2) the priority of the after-acquired construction mortgage lien was not defeated by the doctrine of merger; and (3) there was no fraud under the circumstances presented. View "Winger Contracting Co. v. Cargill, Inc." on Justia Law

Lumber Specialties was hired as a subcontractor on a construction project to provide the truss package and certain engineering services. Dinsdale Construction was hired to supply the labor and building materials on the project. During a visit to the site, an employee of Lumber Specialties supplied false information to the builder regarding the structural integrity of the building. The visit was done was a courtesy to the builder and for the general goodwill of the business. The structure subsequently collapsed due to inadequate temporary bracing of the trusses. Dinsdale had not followed the industry standard temporary bracing plan. Dinsdale Construction brought suit against Lumber Specialties, alleging breach of contract and negligent misrepresentation. The jury returned a verdict for Dinsdale Construction on the negligent misrepresentation claim. The court of appeals affirmed. The Supreme Court vacated the decision of the court of appeals and reversed the district court judgment, holding (1) a defendant who is not acting in its information-giving capacity does not have a duty of care under the negligent misrepresentation tort; and (2) Lumber Specialties’ employee’s statements were excluded from the imposition of duty under the tort. View "Dinsdale Construction, LLC v. Lumber Specialties, Ltd." on Justia Law

Plaintiff was a construction supply business that entered into a dispute with City over a project upgrading City's wastewater treatment facility. After City excluded Plaintiff from its list of preapproved material suppliers, Plaintiff filed this action seeking a declaration that City's preapproval process violated Iowa's public construction bidding statute and constitutional guarantees of equal protection and due process. In addition, Plaintiff sought relief under the Open Records Act, claiming that City's significant delay in responding to Plaintiff's open records request violated the Open Records Act. The district court rejected each of Plaintiff's claims. The Supreme Court (1) affirmed the judgment dismissing Plaintiff's public biding and constitutional claims, as (i) Plaintiff lacked standing to challenge City's preapproval process, and (ii) Plaintiff's constitutional claims failed on the merits; and (2) reversed the district court's ruling denying Plaintiff relief under the open records law, as City's substantial and inadequately explained delay in responding to Plaintiff's open records request violated the law. View "Horsfield Materials, Inc. v. City of Dyersville" on Justia Law

In this breach of contract case, the Supreme Court considered whether the district court erred in denying Defendant's motion for a new trial based on several rulings by the district court that Defendant claimed materially affected his rights and denied him a fair trial. The district court refused Defendant's request to exclude exhibits disclosed by Plaintiff the day before trial in violation of the district court's pretrial scheduling order. Additionally, the district court refused the request to declare a mistrial when Plaintiff testified to certain matters in violation of the district court's stipulated ruling on a motion in limine and denied Defendant's motion for a directed verdict. The court of appeals reversed and remanded for a new trial because it concluded the district court abused its discretion in admitting the exhibits into evidence. The Supreme Court vacated the court of appeals and affirmed the district court, holding that Defendant had not shown the district court committed any error in its decisions during the trial that substantially prejudiced Defendant's rights to a fair trial. Thus, Defendant was not entitled to a new trial. View "Fry v. Blauvelt " on Justia Law

An owner and contractor entered into an agreement for the construction of a new home. During construction, the owner refused to pay the contractor after discovering markups on the cost of materials. In response, the contractor halted construction and filed an action to enforce a mechanic's lien. The contractor subsequently filed a petition to foreclose the mechanic's lien. Although the contractor did not complete construction, the district court found the contractor rendered substantial performance under the contract and entered a judgment against the owner. The court of appeals affirmed. The Supreme Court affirmed in part and vacated in part the court of appeals and reversed the district court, holding that the trial court erred in concluding that the contractor had substantially completed work for the owner. Remanded. View "Flynn Builders, L.C. v. Lande" on Justia Law

At issue in this case was whether a subcontractor that properly performs electrical work on a jobsite, then locks up the work and transfers control to the property owner, owes a duty of care to an employee of the owner electrocuted six days later when the owner fails to deenergize the work site in contravention of various warnings and regulations. The district court granted summary judgment to the subcontractor, holding that the subcontractor owed no duty to the employee because it did not have control of the switchgear box when the employee was injured. The court of appeals reversed. The Supreme Court vacated the court of appeals and affirmed the district court, holding that, under the circumstances, the subcontractor owed no duty of care to the employee. View "McCormick v. Nikkel & Assocs." on Justia Law