Justia Construction Law Opinion Summaries

Neely, acting as his own general contractor, hired Grosvold to perform excavation work on his property under an oral contract. Grosvold worked from April to October 2021, but their relationship deteriorated, and Neely refused to pay for an invoice amounting to $55,858. Neely sent Grosvold a notice of alleged defects in the work, which Grosvold disputed. Grosvold then filed a complaint for breach of contract and prejudgment interest, while Neely counterclaimed for breach of contract, negligence, and construction defect.The District Court of the Third Judicial District in Anaconda-Deer Lodge County tried the case before a jury. The court refused to instruct the jury on Neely’s construction defect and negligence claims, reasoning that the evidence did not substantiate the work was done to a residence and that the case was strictly a breach of contract matter. The jury found Neely had breached the contract and awarded Grosvold $60,512.60 in damages. The court denied Grosvold’s request for prejudgment interest, finding the damages were not certain until the jury’s determination.The Supreme Court of the State of Montana reviewed the case. It affirmed the District Court’s decision not to instruct the jury on the construction defect claim, holding that the residential construction defect statute did not create an independent cause of action beyond breach of contract or tort. The court also affirmed the refusal to instruct the jury on negligence, finding that Neely’s substantial rights were not affected as the breach of contract instructions adequately covered the disputed subject matter. Finally, the court upheld the denial of prejudgment interest, concluding the amount of recovery was not capable of being made certain until the jury’s verdict. View "Grosvold v. Neely" on Justia Law

Donald Fleming filed a lawsuit against Caribou Creek Log Homes, Inc. and North Idaho Insulation, LLC, alleging that spray foam insulation installed by North Idaho Insulation caused significant structural damage to his residence in Montana. Fleming's claims included negligence, violations of residential construction defect statutes, the Montana Consumer Protection Act, and breach of warranties. North Idaho Insulation then filed a third-party complaint against Southwest Distributing Co. (Southwest), alleging that Southwest manufactured and sold the defective spray foam insulation and seeking indemnification and contribution.The Montana Nineteenth Judicial District Court denied Southwest's motion to dismiss for lack of personal jurisdiction, concluding that it had specific personal jurisdiction over Southwest under Montana Rule of Civil Procedure 4(b)(1). Southwest then petitioned the Montana Supreme Court for a writ of supervisory control, arguing that the District Court erred in its jurisdictional ruling.The Montana Supreme Court reviewed the case and determined that the District Court erred in concluding it had specific personal jurisdiction over Southwest. The Supreme Court found that Southwest did not transact business in Montana related to the claims and that the claims did not arise from Southwest's activities in Montana. Additionally, the Court held that the stream-of-commerce theory did not apply, as Southwest did not purposefully direct its activities toward Montana. Consequently, the Supreme Court granted the petition for a writ of supervisory control, reversed the District Court's order, and remanded the case for further proceedings consistent with its opinion. View "Southwest v. 19th Judicial Dist." on Justia Law

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 Supreme Court of the State of Montana affirmed a lower court's decision that an insurance agency, Rames Inc., formerly known as Central Insurance Agency, had a duty to procure additional insurance coverage for a construction company, TCF Enterprises Inc., also known as Malmquist Construction. Rames was found to have breached that duty, thereby breaching the standard of care and negligently misrepresenting that it had obtained the coverage. The court also found that the policy's professional services exclusion would not have barred coverage for defense and indemnity. The dispute arose after Malmquist was sued by a developer due to a construction defect and realized it wasn't covered as an additional insured under a subcontractor's insurance policy as it had believed. Rames had been told by the subcontractor to add Malmquist as an additional insured, but it failed to do so. The jury awarded damages to Malmquist in the amount of $1,022,257.85. Rames appealed, but the Supreme Court upheld the lower court's decision. View "TCF Enterprises, Inc. v. Rames, Inc." on Justia Law

The Supreme Court affirmed the order of the district court granting summary judgment for United Fire and Casualty Company and concluding that Clifford Christian and/or his Estate were not owed a defense or indemnification for claims made against Christian in litigation brought by Linda and Albert Parisian, holding that there was no error.Christian contracted with a general contractor on his project to construct four townhomes, one of which was pre-sold to the Parisians. A subcontractor later sued the general contractor and Parisians to obtain payment for his work to landscape the homesites. Christian was named as a third-party defendant and sought defense and indemnification from United Fire, which had insured the general contractor with a liability policy for the period at issue. After United Fire denied Christian's request Christian's Estate initiated this action. The district court granted summary judgment to United Fire. The Supreme Court affirmed, holding that the complaint did not allege facts that if proven, would trigger policy coverage. View "Christian v. United Fire & Casualty Co." on Justia Law

The Supreme Court affirmed the judgment of the district court regarding several orders unfavorable to Plaintiff in this dispute over the development of a subdivision on property containing a floodplain within Lewis and Clark County, holding that there was no error or abuse of discretion.In its challenged orders, the district court dismissed Plaintiff's negligence and negligent misrepresentation claims, denied Plaintiff's motion for a declaratory judgment that Mont. Code Ann. 76-5-109(4) is unconstitutional, dismissed Plaintiff's claims for inverse condemnation and nuisance, and dismissed Plaintiff's suit against the Montana Department of Transportation. The Supreme Court affirmed, holding that the district court (1) did not err in dismissing Plaintiff's inverse condemnation claim; (2) did not err in dismissing Plaintiff's unjust enrichment claim; (3) did not err in finding Mont. Code Ann. 76-5-109(4) was constitutional; and (4) did not err in dismissing Plaintiff's remaining nuisance claims. View "Hamlin Construction & Development Co. v. Mont. Dep't of Transportation" on Justia Law

The Supreme Court reversed the order entered by the district court denying Skyline Consulting Group's motion to vacate and set aside bond substitution and reinstate construction lien, holding that the district court erred in concluding that Skyline had waived its right to challenge the substitute bond.In this dispute between two subcontractors, Mortensen Woodwork petitioned the district court to substitute Skyline's construction lien against certain property with the intent to pursue foreclosure. Skyline named SP Hotel Owner in the lien. Mortensen then secured a bond from a surety company for 150 percent of the amount Skyline claimed and filed a petition to substitute the bond for the lien. The district court did so. Skyline requested that the district court reinstate its lien because Mortensen was not authorized to substitute a bond. The district court denied the request. The Supreme Court reversed, holding (1) Skyline did not waive its right to challenge the substitute bond in a separate arbitration proceeding; and (2) the district court erred in concluding that Montana law authorized Mortensen, a subcontractor, to substitute a bond for Skyline's construction lien. View "Skyline Consulting Group v. Mortensen Woodwork, Inc." on Justia Law

The Supreme Court affirmed the judgment, decree of foreclosure, and order of sale by the district court, and the orders and actions contained within these documents, holding that there was no error or abuse of discretion.Thermal Design, Inc. filed a complaint to foreclose its construction lien against Mark and Pam Duffy and Central Copters, Inc. The complaint also asserted claims against TNT Building Systems. A jury found that TNT, acting as an agent of Central Copters, entered into a contract with Thermal Design for the insulation system, and both TNT and Central Copters were jointly and severally liable for breaching the contract with Thermal Design. As to a crossclaim between TNT and Central Copters, the jury found that both parties breached their agreement but that only TNT incurred damages. The district court entered a final order restating that, as a matter of law, Thermal Design had a valid construction lien attaching to both the Duffys’ real property and Central Copters’ building that should be foreclosed. The Supreme Court affirmed, holding that the district court did not err or abuse its discretion in the proceedings below. View "Thermal Design, Inc. v. Thorson" on Justia Law

The Supreme Court the decision and final judgment of the district court in favor of Truss Works, Inc. to foreclose a construction lien against Oswood Construction Company, holding that the district court did not err.After Truss Works filed its construction lien it brought this action seeking to foreclose on its lien. Oswood counterclaimed, alleging that Truss Works caused Oswood $118,571 in damages. After a trial, the district court entered judgment in Truss Works's favor. Oswood appealed, arguing that the district court's findings of fact were clearly erroneous because the court never addressed Oswood's counterclaim. The Supreme Court affirmed, holding (1) the district court's findings implicitly addressed Oswood's counterclaim; and (2) the court's findings of fact were supported by substantial evidence, and the court did not commit an error of law. View "Truss Works, Inc. v. Oswood Construction Co." on Justia Law

The Supreme Court reversed in part and affirmed in part the judgment of the district court ordering Plaintiff to pay the attorney fees and costs of Defendant, the prevailing party in a construction defect suit initiated by Plaintiff, holding that the district court erred in part.Plaintiff filed an action against Defendants alleging negligence, breach of contract, and other claims. The district court held in favor of Defendants on all of Plaintiffs' claims. The court then awarded attorney fees and costs to Defendant. The Supreme Court reversed in part, holding that the district court erred by determining that Defendant had a reciprocal right to an award of attorney fees under Mont. Code Ann. 70-19-428 and Mont. Code Ann. 28-3-704. View "Rafes v. McMillan" on Justia Law