Justia Construction Law Opinion Summaries

Plaintiff-Appellant Larry Snyder and Company appealed a district court's grant of summary judgment to Defendant-Appellee Clark Miller, which did business as American Underground Utilities. Snyder and Miller entered into a subcontract agreement under which Miller would install utility trenches underneath what would become a parking lot for an apartment complex. Miller performed the work, but once the asphalt for the lot was installed, the trenches settled and the parking lot was damaged. Snyder requested that Miller repair the entire parking lot, but Miller refused, arguing that the subcontract only required it to repair areas of the lot that actually settled. Upon review by the Tenth Circuit, the court affirmed the district court's order that held that the subcontract unambiguously governed the extent of the repair required by Miller. Accordingly, the Court held that no genuine issue of material fact existed regarding Miller's liability for repair work that exceeded the requirements of the subcontract. View "Larry Snyder and Co. v. Miller" on Justia Law

McKinnis Roofing and Sheet Metal and homeowner Jeffrey Hicks entered into two contracts. The first contract related to Hicks' roof, and the second contract related to copper awnings on Hicks' residence. McKinnis filed a complaint in the district court alleging that Hicks breached both contracts after Hicks refused McKinnis' demand for advance payment. After trial, he district court determined that Hicks had breached both contracts, awarding McKinnis damages in the amount of $4,419 with regard to the roofing contract and $789 with regard to the awning contract. McKinnis appealed, arguing that the district court erred in calculating the amount of damages to which it was entitled. Hicks cross-appealed and claimed that the district court erred when it determined that he breached the contracts. The Supreme Court reversed, holding that based on the facts and contract language, Hicks did not breach either contract. View "McKinnis Roofing & Sheet Metal, Inc. v. Hicks" on Justia Law

Chicago Lumber recorded a construction lien on JoAnn Selvera's home and sued to foreclose the lien. Selvera brought a counterclaim under Neb. Rev. Stat. 52-157, which provides a remedy against claimants who, in bad faith, file liens, overstate liens, or refuse to release liens. Chicago Lumber eventually withdrew its foreclosure action and released its lien, but Selvera maintained her suit. The district court granted summary judgment to Selvera, concluding that (1) because Selvera had not received a copy of Chicago Lumber's lien within ten days of its recording, the lien was invalid; and (2) Chicago Lumber's failure to dismiss its action and to release the lien before it received Selvera's documents clarifying that she had paid her debt in full constituted bad faith. The court awarded Selvera $10,000 in attorney fees. On appeal, the Supreme Court reversed, holding that because Chicago Lumber had a reasonable belief that its lien was valid, at least before it received Selvera's clarifying documents, Chicago Lumber did not act in bad faith. The Court concluded that after Chicago Lumber received the clarifying documents, questions of fact existed whether Chicago Lumber was acting in bad faith. Remanded. View "Chicago Lumber Co. of Omaha v. Selvera" on Justia Law

Drivers, employed by the concrete company, were represented by the union and went on strike after their collective bargaining agreement expired. The company announced that it no longer recognized the union as the drivers' representative and contacted the drivers directly to employ them individually on new terms. A few resigned from the union and returned to work. The strike settled and more returned, on terms less favorable than the previous agreement. The union filed charges with the NLRB. The district court issued an injunction under section 10(j) of the National Labor Relations Act, 29 U.S.C. 160(j), ordering the company to stop certain unfair labor practices pending a final decision by the NLRB. The Seventh Circuit affirmed. The concrete company does not qualify under section 8(f) as an employer engaged primarily in the building and construction industry, that would not be subject to some unfair labor practice restrictions in section 8(a) and would be entitled to withdraw recognition from the union. The court properly found the company's practices to be destructive to the union’s organizational efforts and that the union had established irreparable harm. View "NLRB v. Irving Ready-Mix, Inc." on Justia Law

David Miller purchased a home owned by respondents Linda Lankow and Jim Betz. The home had previously been extensively remediated because of moisture intrusion damage. Respondents Donnelly Brothers and Total Service Company and defendant Diversified Contractors, Inc. did the remediation work. After discovering and notifying respondents and defendants of additional moisture intrusion damage, buyer began to repair the home. Buyer then commenced an action against respondents and defendant to recover damages. The district court excluded buyer's expert witness evidence as a sanction for the spoliation of evidence that resulted from buyer starting to make repairs to his home. The court then granted respondents' summary judgment motion on the basis that buyer could not make a prima facie case without the expert evidence. The court of appeals affirmed. The Supreme Court reversed, holding that the duty of a custodial party to preserve evidence may be discharged when the custodial party has a legitimate need to destroy the evidence and gives the noncustodial party notice sufficient to enable the noncustodial party to protect itself against the loss of the evidence. View "Miller v. Lankow" on Justia Law

A contractor, renovating military housing, obtained a performance bond under the Miller Act (40 U.S.C. 3131 (b)) and abandoned the project after completing 12 percent of the work. The government had paid 40 percent of the contract price. The surety contracted for completion, but the second contractor discovered code violations and incurred penalties for late completion. Costs were reimbursed by the surety, which filed suit under the Tucker Act, 28 U.S.C. 1491. The Federal Circuit held that the Claims Court lacked jurisdiction. The court previously held that the Claims Court has jurisdiction under the Act over sureties' claims based on a theory of equitable subrogation; this case does not involve equitable subrogation because the government made payments at issue before receiving notice of the contractor's default. The waiver of sovereign immunity under the Act does not extend to impairment of suretyship claims apart from the theory of equitable subrogation. The Contract Disputes Act, 41 U.S.C. 601, applies to a surety's claim against the government arising from a takeover agreement between the government and surety for completion of a bonded contract following the principal obligor’s default; the surety failed to satisfy CDA jurisdictional prerequisites. View "Lumbermens Mut. Cas. Co. v. United States" on Justia Law

In 2007, Massachusetts Defendant No. 1 Steel Products, Inc. (No. 1 Steel) was a subcontractor on a construction project at a health rehabilitation center in Massachusetts (Cape Regency project). While working on the project, No. 1 Steel determined that it needed to hire out some of the steel fabrication for which it was responsible. No. 1 Steel found Alabama Plaintiff Garrison Steel Fabricators, Inc. (Garrison). No. 1 Steel was dissatisfied with Garrison's work and refused to pay Garrison anything beyond what it had previously paid. In an attempt to collect the remaining amount owed, Garrison sent No. 1 Steel notice that it intended to file mechanic's liens on the project unless it was paid. Upon receiving the notice, No. 1 Steel filed a motion in Massachusetts court to discharge and release the not-yet-filed-lien, arguing that Garrison was not registered to do business in Massachusetts and that no written contract of the parties' agreement existed. The Massachusetts court granted the motion without stating a rationale. In 2009 Garrison sued No. 1 Steel in Alabama court, asserting claims of open account, implied contract and labor and work performed. No. 1 Steel moved to dismiss, arguing a lack of personal jurisdiction. Upon review of the record, the Supreme Court found the "specific contacts" No. 1 Steel had were not sufficient enough that it should have anticipated being haled into court in Alabama; No. 1 Steel's relationship with Garrison was limited to a one-time purchase of customized goods. The Court directed the trial court to dismiss Garrison's case because the court lacked personal jurisdiction over No. 1 Steel. View "Garrison Steel Fabricators, Inc. v. No. 1 Steel Products, Inc." on Justia Law

This case concerns a construction contract dispute between contractor Trombly Plumbing & Heating and homeowners Edward Quinn, Thomas Quinn, and Regina Gority ("Homeowners"). In the summer of 2007, Trombly and the Homeowners agreed that Trombly would perform services relating to the heating and hot water systems of Homeowners' residential vacation property. Between November 2007 and February 2008, Homeowners experienced a number of problems with the home that they attributed to Trombly's work, such as pipes freezing and furnaces shutting down and leaking.  Trombly brought an initial action for breach of contract and violation of the Prompt Payment Act (9 V.S.A. 4001-4009) seeking the balance due plus the cost of collection.  The Homeowners counterclaimed for breach of contract, negligence, intentional misrepresentation, negligent misrepresentation, fraudulent misrepresentation, and consumer fraud.  They sought actual and punitive damages, as well as litigation costs. The trial court ultimately decided that Trombly could not recover from the Homeowners and the Homeowners could not recover from Trombly, and each party would bear its own costs and fees.  The court found that the Homeowners were not liable to Trombly for anything beyond what they had already paid because the work "was not well done," there were many problems with the work, and the problems were not resolved until another plumber came to fix them.  The court thus found the Homeowners to be the prevailing parties on Trombly's claims because Trombly did not prove its case by a preponderance of the evidence.  As Trombly did not prevail on the merits of the case, the court found there could be no award of attorney's fees.  The court also dismissed all of the Homeowners' counterclaims.  It found that the evidence submitted was insufficient, given that there was no testimony from anyone who did repair work about the problems that had to be corrected or whether the amounts paid for corrective work were fair and reasonable. On appeal, Trombly argued the trial court erred by: (1) improperly placing the burden of proof on contractor with respect to homeowners' defenses and making insufficient findings to support its decision, and (2) improperly applying the "substantially prevailing party" standard under the Prompt Payment Act.  Homeowners cross-appealed, arguing the trial court erred in finding that homeowners were not qualified to offer testimony as to damages for the corrective work performed.  Upon review of the trial record and the applicable legal authority, the Supreme Court affirmed the trial court's decision with regard to all issues brought on appeal. View "Trombly Plumbing & Heating v. Quinn" on Justia Law

Developer refused to pay nearly $6.5 million under the prime contract ($5 million was due subcontractors) claiming deficient work. General contractor declined to pay a subcontractor, who sued on the surety bond. The surety asserted that term 6.f conditioned subcontractor's right to payment on contractor's receipt of payment. In the meantime, contractor settled with developer for $1 million--all it was able to pay--and subcontractor declined a pro rata share in return for a release of claims. The district court granted partial summary judgments in favor of subcontractor for an amount $91,790 less than the claimed $1,074,260. The Third Circuit reversed interpretation of the subcontract and rejection of surety's claim for proportional offset for legal fees incurred in the suit against developer, but affirmed denial of subcontractor's waiver claim, and remanded. The parties intended to share the risk of non-payment. Under 6f developer's payment to contractor is a condition precedent to contractor's obligation to pay subcontractor, yielding after six months to provide a mechanism that specifies when and for how much subcontractor may sue contractor. The contract created a mechanism for passing through subcontractor's remaining claims and pegging recovery to the amount that contractor received from developer for subcontractor's work. View "Sloan & Co. v. Liberty Mut. Ins. Co." on Justia Law

Appellant Shabd-Sangeet Khalsa bought a home kit from Mandala Custom Homes in 2003. The house was assembled and Appellant moved in. Shortly thereafter, the house developed various problems. Appellant climbed a ladder to inspect a leak in the ceiling and fell, injuring herself. Appellant sued Mandala and other parties in 2006, alleging that the house was defective and that the defects in the home caused a host of other damages, including those related to her fall. The superior court set a discovery schedule. When discovery did not proceed smoothly, the court ordered Appellant to sign medical releases, present herself for deposition, and submit to medical testing, cautioning her that if she did not comply with discovery orders, the court would impose sanctions against her. When Appellant refused to sign the medical release forms, the court found her in contempt and dismissed her fall-related claims. Proceeding with Appellant's other claims, the court turned to Appellant's deposition which had been delayed multiple times. The superior court concluded that Appellant's conduct when she eventually did appear constituted a willful refusal to comply with its orders. The court then dismissed Appellant's entire case with prejudice. Appellant argued on appeal that the trial court abused its discretion. Finding no abuse, the Supreme Court affirmed the trial court's dismissal. View "Khalsa v. Chose" on Justia Law