Justia Construction Law Opinion Summaries

The Court of Appeals affirmed the decision of the Maryland State Board of Contract Appeals (MSBCA) granting summary disposition as to the Maryland State Highway Administration's (SHA) claims against Brawner Builders, Inc. and Faddis Concrete Products, Inc., holding that there was no error in the MSBCA's decision to grant SHA's motion for summary decision.SHA and Brawner entered into a contract for the construction of noise barriers along a section of interstate. Faddis manufactured noise wall panels for Brawner's use in connection with the project. SHA subsequently suspended approval of Faddis-produced noise panels. Faddis filed a procurement contract claim. The MSBCA issued summary disposition to the SHA, concluding that Faddis had no standing to file such a claim. At issue on appeal was whether Faddis's status as a "pre-approved supplier" of concrete panels on construction projects administered by the SHA constituted a "procurement contract" with the State under the State Finance and Procurement Article. The circuit court reversed. The court of special appeals reversed the circuit court. The court of Special Appeals affirmed, holding that the MSBCA properly dismissed Faddis's claims and entered judgment in SHA's favor. View "Brawner Builders, Inc. v. Maryland State Highway Administration" on Justia Law

JT Construction, LLC ("JTC"), appealed a circuit court's judgment awarding declaratory and injunctive relief to MW Industrial Services, Inc. ("MWI"). MWI contracted with Golder Associates, Inc., to provide labor and services for a construction project at Plant Gorgas, a power plant operated by Alabama Power Company. Pursuant to the terms of the contract, MWI was prohibited from "permit[ting] any lien, affidavit of nonpayment, stop payment notice, attachment or other encumbrance ... to remain on record against [Plant Gorgas] or the property upon which it is situated for ... work performed or materials finished in connection [there]with" by any subcontractor with whom MWI might also contract. JTC subcontracted with MWI to work at Plant Gorgas. The subcontract agreement ("the lien-waiver provision") precluded JTC, in accordance with the master contract, from filing a lien against property owned by Alabama Power or Southern Company. Following execution of the subcontract agreement, a dispute arose between MWI and JTC in connection with JTC's performance of its contractual obligations and the amount owed to JTC for the work it had performed. In September 2020, counsel for JTC provided a "Notice of Mechanics' Lien" indicating that JTC claimed against the real property on which Plant Gorgas was situated, a lien in connection with JTC's work under the subcontract agreement. MWI pointed out the language of the lien-waiver provision of its subcontract, and demanded that JTC withdraw the lien notice. MWI asserted that JTC had been paid for any previous work before its execution of the subcontract agreement, and demanded that JTC withdraw its notice of lien. The trial court ultimately entered an order issuing a permanent injunction and ruling in favor of MWI on its declaratory-judgment claim, prohibiting JTC from filing its lien. The Alabama Supreme Court held the trial court erred in issuing the declaratory judgment and in awarding permanent injunctive relief without prior notice to JTC, as required by Rule 65(a)(2), and that JTC was prejudiced by that error. The trial court's judgment was therefore reversed, and this case was remanded for further proceedings. View "JT Construction, LLC v. MW Industrial Services, Inc." on Justia Law

Plaintiffs Robbie Dillinger and Steve Kimbrough, LLC sued defendants Bryant Bank, Audrey Fleming and Michael Francis Flemming, III for the cost of work performed on the Flemmings’ property. The trial court issued a final judgment in favor of defendants. Later, plaintiffs filed an amended complaint adding Joe Kimbrough as a plaintiff, which the trial court struck. Kimbrough and the other plaintiffs appealed. But because the construction parties’ appeal was untimely, the Alabama Supreme Court concluded it lacked jurisdiction and dismissed the appeal. View "Dellinger, et al. v. Flemming, et al." on Justia Law

The Eighth Circuit affirmed the district court's award of $283,609.15 in attorneys' fees to Manning in this action arising out of a contract dispute between Kinder, a general contractor, and Manning, a subcontractor.The court concluded that the district court properly applied Arkansas state law to decide the matter because the issue of attorneys' fees is a procedural matter governed by Arkansas law. The court also concluded that the subcontract's silence as to Manning's ability to recover attorneys' fees as the prevailing party does not operate as a waiver of its right to recover such fees under Ark. Code Ann.16-22-308. The court further concluded that because the requested attorneys' fees were incurred by Manning, Manning's recovery of such attorneys' fees is not prohibited under Ark. Code Ann. 23-79-208. View "Randy Kinder Excavating, Inc. v. JA Manning Construction Company, Inc." on Justia Law

The Supreme Court held that Specialty Companies Group, LLC's claims under an alter ego theory against Meritage Homes of Arizona were time-barred under Ariz. Rev. Stat. 12-548(A)(1)'s six-year limitation period for claims founded on or evidenced by a written contract.Maricopa Lakes, LLC hired G&K South Forty Development to serve as project manager on a real estate development project. G&K hired Specialty to assist with the project. Specialty later sued G&K to collect unpaid invoices. G&K filed a third-party complaint against Maricopa Lakes, was awarded a default judgment, and assigned to Specialty its claims against Maricopa Lakes. Specialty subsequently sued Meritage, which formed Maricopa Lakes, under an alter ego theory. The trial court granted summary judgment to Meritage, ruling that Specialty's claims were time-barred. The court of appeals reversed, concluding that the alter ego claim was an action on a judgment governed by a five-year statute of limitations that began to run when the judgment was final. The Supreme Court reversed, holding (1) the statute of limitations for alter ego actions is determined by reference to the cause of action from which the alter ego claim derives; and (2) Specialty was bound by the six-year statute of limitations for breach of contract. View "Specialty Companies Group, LLC v. Meritage Homes of Arizona, Inc." on Justia Law

All Seasons inspected SparrowHawk's warehouse roofs and discovered hail damage. Because All Seasons did not hold an Illinois roofing license, it arranged for Prate to serve as general contractor with All Seasons as subcontractor. All Seasons was to provide materials and labor, maintain safety, and supervise the project. All Seasons purchased a commercial general liability policy and general liability extension endorsement from United, listing Prate as an “additional insured” in a “vicarious liability endorsement.” All Seasons then subcontracted with Century. Ayala, a Century employee was working on a SparrowHawk warehouse when he fell to his death.The Illinois workers’ compensation system provided limited death benefits but precluded tort remedies against his direct employer, Century. Ayala’s estate sued Prate, All Seasons, and SparrowHawk. Prate tendered the defense to United, which declined to defend and sought a declaratory judgment. All Seasons and United reached a settlement with the estate, paying the policy limits.The district court granted Prate summary judgment. The Seventh Circuit affirmed, rejecting United’s argument that because its named insured was an independent contractor, Illinois law would not impose any liability on the additional insured and there was no risk of covered liability. The duty to defend depends on the claims the plaintiff asserts, not on their prospects for success. The settlement of the underlying claims against the named insured, however, removed any possibility that the additional insured might be held vicariously liable for actions of the named insured; the duty to defend ended when that settlement was consummated. View "United Fire & Casualty Co. v. Prate Roofing & Installations LLC" on Justia Law

The Supreme Court affirmed the order of the district court granting Defendants' motion for summary judgment and dismissing this action brought by Somersett Owners Association (SOA) seeking to recover damages against those involved in the design and construction of stacked retaining walls supporting the Somersett residential development in northern Nevada, holding that the statute of repose barred this lawsuit.After the rockery walls began failing, SOA brought suit against Defendants alleging negligence and negligence per se, breach of express and implied warranties and other claims. Defendants moved for summary judgment on the ground that the six-year period of repose set forth in Nev. Rev. Stat. 11.202 applied. The district court granted summary judgment for Defendants. At issue was when the rockery walls achieved "substantial completion" for purposes of section 11.202. The Supreme Court held (1) the six-year period in section 11.202 begins when the improvement to the real property is "substantially complete," which means sufficiently complete so that the owner can occupy or utilize the improvement; and (2) SOA failed to set forth specific facts demonstrating the existence of a genuine factual issue as to whether it brought the underlying suit within the six-year period set by section 11.202. View "Somersett Owners Ass'n v. Somersett Development Co." on Justia Law

In 2002, Farfield contracted with SEPTA for improvements on Philadelphia-area railroad tracks. The federal government partially funded the project. Work concluded in 2007. As required by federal regulation, Department of Labor (DOL) prevailing wage determinations were incorporated into the contract. Farfield was required to submit to SEPTA for transmission to the Federal Transit Administration a copy of Farfield’s certified payroll, setting out all the information required under the Davis-Bacon Act, 40 U.S.C. 3142(a), with a “Statement of Compliance” averring that the information in the payroll was correct and complete and that each worker was paid not less than the applicable wage rates and benefits for the classification of work performed, as specified in the applicable wage determination. Falsification of a payroll certification could subject Farfield to criminal penalties or civil liability under the False Claims Act (FCA).A union business manager suspected that Farfield had won government contracts with low bids by intending to pay less-skilled workers to perform certain work that would otherwise have been the bailiwick of higher-skilled, higher-paid workers. Ultimately, the union filed a qui tam FCA complaint. The United States declined to intervene. The court entered a $1,055,320.62 judgment against Farfield: $738,724.43 to the government and $316,596.19 to the union, plus $1,229,927.55 in attorney fees and $203,226.45 in costs. The Third Circuit affirmed. In view of the totality of the circumstances, Farfield’s Davis-Bacon violations were not minor or insubstantial. View "International Brotherhood of Electrical Workers v. Farfield Co" on Justia Law

The Sellers bought an Oakland property to “flip.” After Vega renovated the property, they sold it to Vera, providing required disclosures, stating they were not aware of any water intrusion, leaks from the sewer system or any pipes, work, or repairs that had been done without permits or not in compliance with building codes, or any material facts or defects that had not otherwise been disclosed. Vera’s own inspectors revealed several problems. The Sellers agreed to several repairs Escrow closed in December 2011, but the sewer line had not been corrected. In January 2012, water flooded the basement. The Sellers admitted that earlier sewer work had been completed without a permit and that Vega was unlicensed. In 2014, the exterior stairs began collapsing. Three years and three days after the close of escrow, Vera filed suit, alleging negligence, breach of warranty, breach of contract, fraud, and negligent misrepresentation. Based on the three-year limitations period for actions based on fraud or mistake, the court dismissed and, based on a clause in the purchase contract, granted SNL attorney’s fees, including fees related to a cross-complaint against Vera’s broker and real estate agent.The court of appeal affirmed. Vera’s breach of contract claim was based on fraud and the undisputed facts demonstrated Vera’s claims based on fraud accrued more than three years before she filed suit. Vera has not shown the court abused its discretion in awarding fees related to the cross-complaint. View "Vera v. REL-BC, LLC" on Justia Law

In this case involving the correct interpretation of provisions in the Prompt Pay Act, Tenn. Code Ann. 66-34-101 to -704, relating to retainage withheld on construction projects, the Supreme Court held that the $300 per day penalty is assessed each day retaining is not deposited in a statutorily-compliant escrow account.The Act requires the party withholding retain age to deposit the funds into a separate, interest-bearing escrow account, and failure to do so results in a $300 per day penalty. Here, Subcontractor's retainage was not placed into an interest-bearing escrow account, and the retainage was not timely remitted to Contractor. Three years after completing its contractual duties, Subcontractor sued Contractor for unpaid retainage plus amounts due under the Act. Thereafter, Contractor tendered the retainage. At issue was the statutory penalty. The trial court concluded that Subcontractor's claim under the Act was barred by Tenn. Code Ann.'s one-year statute of limitations. The court of appeals affirmed. The Supreme Court reversed, holding that while Subcontractor's claim for the statutory penalty was subject to the one-year statute of limitations, if Subcontractor can establish that Contractor was required to deposit the retainage into an escrow account, Subcontractor was not precluded from recovering the penalty assessed each day during the period commencing one year before the complaint was filed. View "Snake Steel, Inc. v. Holladay Construction Group, LLC" on Justia Law