Justia Construction Law Opinion Summaries

In a wrongful death action, the jury returned a special verdict that awarded damages to the individual loss-of-consortium claimants but not to the decedent’s estate. The decedent’s surviving spouse and children (collectively Plaintiffs) filed a motion for a new trial, arguing that the award of zero damages to the estate was not supported by substantial evidence. The issue before the New Mexico Supreme Court was whether Plaintiffs waived the right to challenge the jury verdict on appeal by failing to object to the verdict prior to the jury’s discharge. After review, the Supreme Court concluded that they did: “A party is deemed to have waived a challenge to an ambiguous, inconsistent, or incomplete jury verdict if the party had an opportunity to raise the objection before the jury was discharged but failed to do so.” In this case, Plaintiffs created ambiguity in the verdict by modifying the uniform jury instruction on wrongful death damages and drafting the special verdict form in a way that failed to advise jurors how to allocate damages between the individual loss-of-consortium claimants and the decedent’s estate. During its deliberations, the jury submitted a question to the district court which confirmed that the jury was confused about how to allocate damages on the special verdict form. As a result of this confusion, it was unclear whether the jury deliberately intended to award zero wrongful death damages to the estate or whether the jury mistakenly included wrongful death damages in its award to the individual claimants. View "Saenz v. Ranack Constructors, Inc." on Justia Law

In 2005, Roark, a Sunesis laborer, was working alone at the bottom of a trench, when the trench collapsed, killing him. The Bureau of Workers’ Compensation awarded Roark’s dependent children benefits. The dependents sought an additional award based on violations of specific safety requirements for sloping, shoring, and bracing. A hearing officer concluded that Roark’s death was the result of Sunesis’s failure to properly support the trench and ordered Sunesis to pay an additional award based on violations of Ohio Adm.Code 4123:1-3-13. On remand, a hearing officer issued factual findings based on photographs and testimony: Three sides of the trench were adequately shored. The fourth wall, which caved in on Roark, consisted of soil that Sunesis attempted to shore up by sloping the wall and inserting a steel plate above the slope. The hearing officer found no evidence that Roark disregarded instructions to work inside a large underground pipe. On rehearing, in 2012, a hearing officer identified the soil involved as soft material, Class C soil with groundwater, stating that Code Table 13-1 addresses the approximate angle of repose for sloping: The presence of groundwater requires special treatment. The commission, the Tenth District, and the Supreme Court of Ohio upheld the award. It was within the commission’s discretion to conclude that the trench was not properly shored or braced, exposing employees to the danger of moving ground and that failure to comply with the regulations proximately caused Roark’s death. View "Sunesis Construction Co. v. Industrial Commission of Ohio" on Justia Law

At issue in this case was the applicability of a broad, absolute insurance pollution exclusion clause to a claim based on negligent installation of a hot water heater that led to the release of toxic levels of carbon monoxide in a residential home. Zhaoyun "Julia" Xia purchased a new home constructed by Issaquah Highlands 48 LLC. Issaquah Highlands carried a policy of commercial general liability insurance through ProBuilders. Soon after moving into her home, Xia began to feel ill. A service technician from Puget Sound Energy investigated Xia's home and discovered that an exhaust vent attached to the hot water heater had not been installed correctly and was discharging carbon monoxide directly into the confines of the basement room. The claims administrator for ProBuilders, NationsBuilders Insurance Services Inc. (NBIS), mailed a letter to Xia indicating that coverage was not available under the Issaquah Highlands policy. As a basis for its declination of coverage, NBIS rested on two exclusions under the policy: a pollution exclusion and a townhouse exclusion. NBIS refused to either defend or indemnify Issaquah Highlands for Xia's loss. When a nonpolluting event that was a covered occurrence causes toxic pollution to be released, resulting in damages, the Washington Supreme Court believed the only principled way for determining whether the damages are covered or not was to undertake an efficient proximate cause analysis. Under the facts presented here, the Court found ProBuilders Specialty Insurance Co. correctly identified the existence of an excluded polluting occurrence under the unambiguous language of its policy. However, it ignored the existence of a covered occurrence negligent installation-that was the efficient proximate cause of the claimed loss. Accordingly, coverage for this loss existed under the policy, and ProBuilders's refusal to defend its insured was in bad faith. View "Xia v. Probuilders Specialty Ins. Co." on Justia Law

Escobar was an employee of O’Donnell, a sub-subcontractor of Bayside, which was a subcontractor of Oltmans, the general contractor on a Menlo Park construction project. Escobar sued Oltmans and the property owner, alleging that Oltmans negligently cut and left unsecured a skylight opening in the building under construction, through which Escobar fell while installing scaffolding that O’Donnell was erecting for Bayside. Oltmans filed a cross-complaint against the subcontractors, alleging a right to contractual indemnity and breach of Bayside’s contractual obligation to provide certificates of insurance certifying that Oltmans was covered as an additional insured under liability policies the subcontractors were obligated to obtain. The subcontract provided indemnity to Oltmans for injury claims arising out of the scope of the subcontractor’s work “except to the extent the claims arise out of, pertain to, or relate to the active negligence or willful misconduct” of Oltmans. Reversing the trial court, the court of appeal ruled in favor of Oltmans. Under such a provision the general contractor is precluded from recovering indemnity for liability incurred as a result of its own active negligence but may be indemnified for the portion of liability attributable to the fault of others. The court noted the same question arises as to the meaning of Civil Code section 2782.05, which renders unenforceable an indemnity provision “to the extent the claims arise out of, pertain to, or relate to the active negligence or willful misconduct of that general contractor.” View "Oltmans Construction Co. v. Bayside Interiors, Inc." on Justia Law

Lend Lease (US) Construction was the general contractor on a project, and Rossi Electric Company, Inc. was a subcontractor. An employee of Rossi’s subcontractor was injured while working on the project and filed a negligence claim against Lend Lease. Lend Lease filed a third-party complaint against Rossi, alleging that, under the terms of a contract between the parties, Rossi was required to defend and indemnify Lend Lease. The superior court entered an order granting summary judgment for Rossi. The Supreme Court vacated the judgment of the superior court, holding that issues of material fact remained to be determined, and therefore, this case was not ripe for summary judgment. Remanded. View "Walsh v. Lend Lease (US) Construction" on Justia Law

Homeowners obtained loans from Bank for the construction of a new home and entered into an agreement with Contractor to complete the new home construction. When Homeowners defaulted on payments owed to Contractor and on both loans, the house was sold at foreclosure, and Homeowners filed for bankruptcy. Contractor filed a fourth amended complaint against Homeowners, who were later dismissed as parties, and Bank. Following a trial the court granted summary judgment for Bank on Contractor’s claims of fraud and civil conspiracy. The Supreme Court reversed. After remand, Contractor filed a fifth amended complaint, which differed from the fourth amended complaint in several respects. The district court determined that the election of remedies doctrine and judicial estoppel required a dismissal of Contractor’s claims. The Supreme Court reversed, holding (1) Contractor’s claims were consistently premised on the existence of a contract, and therefore, no election was required; and (2) Contractor’s claims were based on different facts and obligations, and therefore, both could be pursued. View "deNourie & Yost Homes, LLC v. Frost" 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

Advent was the general contractor for the Aspen Village project in Milpitas. Advent subcontracted with Pacific, which subcontracted with Johnson. Advent was covered by a Landmark insurance policy and a Topa excess insurance policy. Johnson was covered by National Union primary and excess policies. Kielty, a Johnson employee, fell down an unguarded stairway shaft at the site and sustained serious injuries. Kielty sued Advent, which tendered its defense to its insurers and to National Union. National Union accepted under a reservation of rights. Kielty settled for $10 million. Various insurers, including Topa and National Union (under its primary policy), contributed to the settlement. National Union did not provide coverage under its excess policy. Advent sought a declaration that it was an “additional insured” under that excess policy. Topa intervened, seeking equitable contribution from National Union, and equitable subrogation. Advent dismissed its complaint with prejudice. Summary judgment was entered against Topa, for National Union. The court of appeal affirmed. While Topa’s policy was vague, National Union’s excess policy states that coverage will not apply until “the total applicable limits of Scheduled Underlying Insurance have been exhausted by the payment of Loss to which this policy applies and any applicable, Other Insurance have been exhausted by the payment of Loss.” View "Advent, Inc. v. National Union Fire Insurance Co. of Pittsburgh" on Justia Law

In 2006, Union Pacific Railroad (UP) invited contractors to bid on the purchase and removal of three abandoned railroad bridges that spanned Chicago streets. Happ’s, a scrap contractor, had worked railroads for 25 years recycling steel and railroad ties. Carney (dba Chicago Explosive) had a 20-year business relationship with Happ; the two entered “a handshake agreement” concerning the bid. UP accepted Happ’s bid, unaware of the agreement between Happ’s and Carney. Removal of the first bridge proceeded without incident. During the demolition of the larger Polk Street Bridge, a crossbeam snapped. The west girder, which was not secured or supported, fell. Plaintiff, standing north of the bridge on a gravel-covered steel plate, slid forward under the falling girder. Plaintiff’s legs were severed below his knees. Plaintiff sued UP, alleging negligence in failing to discover and disclose to Happ’s or plaintiff the presence of the steel plate and in hiring Happ’s. The trial court granted UP summary judgment. The appellate court reversed. The Illinois Supreme Court reinstated summary judgment. UP owed plaintiff no duty. There was nothing in the contract indicating that UP retained control such that Happ’s was not entirely free to do the work in its own way, nor was UP’s conduct inconsistent with the agreement. Plaintiff was an employee of Carney, not a “bystander.” UP did not build the bridge, did not possess the plans for the bridge, did not use the bridge, and had no reason to know that the steel floor plate extended several feet into the roadbed, precluding plaintiff’s premises liability claim. View "Carney v. Union Pacific R.R. Co." on Justia Law

In 2014, Lend Lease, the construction manager of the Chicago River Point Tower Project, hired Cives as a subcontractor. Cives hired Midwest Steel. Midwest had, years before, hired AES to supply Midwest with additional workers, who were co‐employed by Midwest and AES. Lend Lease entered into a “contractor-controlled insurance program” with Starr Liability with a $500,000 deductible. All subcontractors were to join in the policy. AES had, several years earlier, obtained workers’ compensation for its workers from TIC, so that injured AES‐Midwest workers could obtain workers’ compensation from either Starr (or Lend Lease under the deductible) or TIC. Four ironworkers, jointly employed by Midwest and AES and performing work for Midwest were injured on the job and sought workers’ compensation. The claims exceeded $500,000, so Lend Lease had to pay its full deductible. Starr paid the remaining claims. Lend Lease filed suit against TIC, AES’s insurer, and AES, seeking reimbursement of the $500,000. The district court dismissed. The Seventh Circuit affirmed. Lend Lease made a deal with Starr and is bound by it. The court rejected an argument that AES has been unjustly enriched; AES was not obligated to purchase an insurance policy that would cover Lend Lease's deductible. View "Lend Lease (US) Construction, Inc. v. Administrative Employer Services, Inc." on Justia Law