Justia Construction Law Opinion Summaries

A pipeline owner (Owner) purchased sixty-eight mile-long pipeline constructed in the 1940s and made plans to remove the old pipeline and construct a new one that would carry butane. Owner awarded Contractor the contract to replace a certain section of the pipeline. After Contractor commenced work, Contractor filed suit against Owner for breach of contract and fraud based on Owner's failure to locate several hundred "foreign crossings" in the pipeline's path and its subsequent refusal to compensate Contractor for its additional expenses resulting from the obstacles. The trial court found in favor of Owner, finding that the parties' contract allocated the risk of any additional cost incurred because of foreign crossings to Contractor. The court of appeals reversed, finding that Owner failed to exercise due diligence in locating the foreign crossings. The Supreme Court reversed the court of appeals' judgment and reinstated the trial court's judgment, holding (1) the contract allocated all risk to Contractor for unknown obstacles discovered during the construction process; and (2) the jury's answers to questions about Contractor's recovery for breach of contract based on due diligence were immaterial. View "El Paso Field Servs., L.P. v. MasTec N.A., Inc." on Justia Law

This issue before the Supreme Court in this case centered on an action to recover damages from a well driller who drilled a well that later caved in. The district court granted the well driller's motion for summary judgment on the ground that the alleged claims of negligence and breach of contract were barred by the applicable statutes of limitations, and the court dismissed the action. Upon review, the Supreme Court held that that the breach of contract claim was indeed barred by the statute of limitations and that the negligence claim was barred by the economic loss rule. The Court affirmed the district court's dismissal of the case. View "Stapleton v. Jack Cushman Drilling" on Justia Law

Hospital purchased from Assurance Company of America a "builder's risk" insurance policy and contracted with Wehr Constructors for installation of subsurfaces and floors as part its project. After installation, a portion of the floors and subsurface done by Wehr was damaged. Hospital sought recompense under the builders risk policy. Assurance denied the claim. Meanwhile, Wehr and Hospital settled on Wehr's breach of contract claim. As part of the settlement, Hospital assigned to Wehr any claim Hospital had against Assurance arising out of the policy. Wehr, as Hospital's assignee, then sued Assurance in federal district court. Assurance moved for judgment on the pleadings, invoking the policy's anti-assignment provision and arguing that it had not consented to the assignment. The district court requested certification to answer a question of Kentucky law. The Supreme Court concluded that under Kentucky law, a clause in an insurance policy that requires the insured to obtain the insurer's prior written consent before assigning a claim for an insured loss under the policy is not enforceable or applicable to the assignment of a claim under the policy where the covered loss occurs before the assignment, and that such a clause would, under those circumstances, be void as against public policy. View "Wehr Constructors, Inc. v. Assurance Co. of Am." on Justia Law

A general contractor (Carlisle) for a construction project contracted with Plaintiff to perform carpentry work for the project. A bond was issued for the project. Carlisle was the principal on the bond, and International Fidelity Insurance Company (IFIC) was the surety. Plaintiff later filed suit against Carlisle and IFIC seeking to recover payment for the work it performed. The arbitrator issued two amended awards. Plaintiff moved the superior court to confirm the second amended awarded concerning Carlisle's liability and to modify it as to IFIC. The trial justice remanded the matter back to the arbitrator for a determination as to IFIC's liability. The arbitrator on remand found that both Carlisle and IFIC were liable to Plaintiff for $43,543. The trial justice confirmed the post-remand arbitration award. The Supreme Court affirmed but on different grounds, holding (1) the second amended award should have been vacated under R.I. Stat. 37-16-18(2), and the trial justice was authorized, under section 37-16-19, to remand the case to the same arbitrator for a hearing; and (2) because the remand in this case accomplished the same result that could have been accomplished under section 37-16-18 and 37-16-19, the judgment was affirmed. View "Drago Custom Interiors, LLC v. Carlisle Bldg. Sys., Inc." on Justia Law

Kadrmas, Lee & Jackson, Inc., ("KLJ") appealed a district court judgment awarding the City of Valley City ("City") costs and expenses the City incurred defending itself in the underlying lawsuit and pursuing its indemnity claim against KLJ. The City entered into a contract with KLJ to provide engineering services for a paving and sewer project. The City hired a general contractor for the project. The contract between the City and the contractor required the contractor to furnish all labor, materials, and equipment for the project. The contractor was required to provide a payment bond under the terms of its contract with the City, and St. Paul Fire & Marine Insurance Company ("St. Paul") was the surety under the bond. Specialized Contracting, Inc. ("SCI"), entered into a subcontract with the contractor to complete some of the work on the project. In 2007, SCI sued St. Paul for breach of its duties under the payment bond, seeking compensation for additional work SCI alleged it completed on the project for which the contractor refused to pay. St. Paul served a third-party complaint against the City for breach of contract and indemnity, alleging the concrete repair work was outside the scope of the City's contract with the contractor, the City was liable to the contractor for any additional compensation SCI was claiming against the payment bond if SCI established KLJ's decision to replace the concrete was beyond the scope of the contract, and the City was required to indemnify St. Paul for any judgments against it in favor of SCI arising from decisions made by KLJ. Upon review of the matter, the Supreme Court concluded KLJ did not have a duty to defend the City. The Court reversed the district court's judgment awarding the City costs and expenses, and remanded the case for a determination of whether KLJ was entitled to recover its costs and expenses as a prevailing party. View "Specialized Contracting, Inc. v. St. Paul Fire & Marine Ins." on Justia Law

While installing a natural-gas pipeline in Madison, Wisconsin, KS Energy was cited by the Occupational Safety and Health Administration for violating trench safety regulations that require companies to protect workers from dangerous cave-ins. After inspecting KS Energy’s trench, OSHA issued a citation alleging a repeat violation of 29 C.F.R. 1926.652(a)(1) for failing to provide an adequate protective system. An ALJ upheld the citations, finding that the soil in the trench was “Type B,” so the slope was too steep based on and KS improperly used the technique of “benching” to configure its trench. The OSHA Review Commission made the determination final. The Seventh Circuit denied review. The parties agree that if the soil in the excavation was properly classified as Type B, the trench was impermissibly steep. Substantial evidence supports the determination that the soil was classified as Type B. View "KS Energy Serv., LLC v. Solis" on Justia Law

Appellant filed a complaint in district court after making an unsuccessful construction bid to the Town of Thayne City Council, claiming (1) a civil rights violation pursuant to 42 U.S.C. 1983, (2) that the Town failed to provide an independent observation of the bid evaluation and selection process, and (3) a breach of the covenant of good faith and fair dealing. The district court granted the Town's motion for summary judgment on the 42 U.S.C. 1983 claim and dismissed the remaining claims for failure to state a claim. The Supreme Court summarily affirmed given the deficient brief filed by Appellant and Appellant's failure to comply with the Wyoming Rules of Appellate Procedure. View "Call v. Town of Thayne" on Justia Law

The owners of two properties leased them to developer-tenants for the purpose of building an apartment building on each. As construction was beginning, the landlords breached the leases by refusing to provide estoppel certificates and contesting the tenants' building permits. The landlords' breach prevented the tenants from obtaining financing, which ended the development project. The tenants sued for lost profits. Before trial, the circuit court ruled against the landlords on several motions, holding in part (1) the landlords could not introduce evidence of the 2008 crash in the real estate market to show that the tenants would not have made profits, and (2) the tenants could introduce evidence of the landlords' reasons for breaching, including communications with their former counsel. The jury awarded the tenants over $36 million in damages, holding the landlords jointly and severally liable. The court of special appeals held the landlords could not be held jointly and severally liable but otherwise affirmed. The Court of Appeals affirmed, holding (1) the trial court did nor err in excluding all evidence of post-breach market data in measuring damages; and (2) the landlord waived the attorney-client privilege as to communications relevant to the subject matter of the claim of bad faith. View "CR-RSC Tower I, LLC v. RSC Tower I, LLC" on Justia Law

This case involved the appeal of Petitioner of her sentence of life without mercy imposed in the circuit court by order, as recommended by the jury which found Petitioner guilty of first degree murder. Petitioner assigned four errors committed by the trial court, including the admission of the decedent's statements, failure to give a Harden instruction, failure to give a good character instruction, and the failure to suppress one of Petitioner's statements to the police. The Supreme Court reversed the judgment of the circuit court and remanded the case for a new trial, holding (1) the court did not err in admitting the statements of the decedent; (2) the court's decision to admit the statement was not an abuse of discretion; but (3) under the limited circumstances of this case, the court erred in failing to give a proper good character instruction. View "State v. Surbaugh" on Justia Law

The Corps contracted with Atlantic for the construction of a child development center and Atlantic entered into a Subcontract Agreement with J-Crew for labor and materials. The Subcontract Agreement included a forum-selection clause, which provided that disputes shall be litigated in Virginia courts. Ignoring the forum-selection clause, J-Crew filed suit against Atlantic in Texas. Applying 28 U.S.C. 1404(a), the district court denied Atlantic's motion to transfer, finding that Atlantic had not met its burden of showing why the interest of justice or the convenience of the parties and their witnesses weighed in favor of transferring the case to Virginia. Atlantic subsequently petitioned the court for a writ of mandamus to dismiss or transfer the case. Because the court found that the district court did not clearly abuse its discretion by considering enforcement of the forum-selection clause under section 1404(a), instead of under Rule 12(b)(3) and section 1406; and by conducting its analysis under section 1404(a), the court denied the petition. View "In re: Atlantic Marine Const Co. Inc." on Justia Law