Justia Contracts Opinion Summaries

D2 filed suit for breach of contract, quantum meruit, violations of the Texas prompt pay statute, and to foreclose on a statutory and constitutional lien. Thompson, in turn, alleged that D2 breached the excavation contract between the parties. The district court held in D2's favor on all claims and ordered Thompson to pay for unpaid work and for "excess" excavating work, as well as interest and attorneys' fees.The Fifth Circuit held that the district court did not clearly err by finding that management of the site was so deficient that D2 had to regrade the same areas as many as six times and was unable to complete its work in other parts of the site, justifying D2's cessation of work. Therefore, the court affirmed the district court's judgment for the $81,068 in unpaid work and the related prompt payment statute and lien remedies for that breach of contract. However, the court held that neither breach of contract nor quantum meruit allows D2 to recover for "excavation of unanticipated excess soil." Thus, the court reversed the district court's judgment of $257,588.53 for the "excavation of unanticipated excess soil" and rendered judgment for Thompson on those breach of contract and quantum meruit claims. The court remanded for modification of the judgment. View "D2 Excavating, Inc. v. Thompson Thrift Construction, Inc." on Justia Law

Caliber Paving Company, Inc. (Caliber) sued Rexford Industrial Realty and Management, Inc. (Rexford) for intentional interference with a contract between Caliber and Steve Fodor Construction (SFC). The trial court granted Rexford’s motion for summary judgment on the ground that Rexford, although not a party to the contract, had an economic interest in it and therefore could not be liable in tort for intentional interference with contract. Caliber appealed. In a case of first impression, the Court of Appeal held that under Applied Equipment Corp. v. Litton Saudi Arabia Ltd., 7 Cal.4th 503 (1994), a defendant who is not a party to the contract or an agent of a party to the contract is a noncontracting party or stranger to the contract and, regardless whether the defendant claims a social or economic interest in the contractual relationship, may be liable in tort for intentional interference with contract. Applied Equipment did not confer immunity for intentional interference with contract on noncontracting parties having a social or economic interest in the contractual relationship from liability. The Court also concluded Caliber submitted admissible evidence sufficient to meet its burden of raising a triable issue of fact as to whether Rexford interfered with the contract between SFC and Caliber. Judgment was reversed and the matter remanded for further proceedings. View "Caliber Paving Co. v. Rexford Industrial Realty and Management" on Justia Law

In 2003, the government awarded Parsons a $2.1 billion indefinite-delivery, indefinite-quantity contract for planning and construction work to be described in subsequent task orders. In 2005, the government issued a $34 million task order to complete an existing, concept-level design and construct the Temporary Lodging Facility and Visiting Quarters, at the McGuire Air Force Base. Design and construction were completed. The Air Force accepted the completed facilities for “beneficial use” in September 2008. In 2012, Parsons submitted a claim for approximately $34 million in additional costs that Parsons allegedly incurred in the design and construction process. The Armed Services Board of Contract Appeals awarded Parsons about $10.5 million plus interest.The Federal Circuit reversed in part after holding that the Board had Contracts Dispute Act jurisdiction 41 U.S.C. 7102(a)(1), (3). The court dismissed Parsons’ appeal as to its payroll claim and reversed the Board’s denial of recovery to Parsons for its claim to construction costs. On remand, the Board must award Parsons the difference between its cost in constructing a substituted design compared to the cost Parsons would have incurred in constructing a structural brick design. The court affirmed the Board’s conclusion that Parsons’ costs awarded by the Board were reasonable. View "Parsons Evergreene, LLC v. Secretary of the Air Force" on Justia Law

Plaintiff Skanska USA Building Inc. served as the construction manager on a renovation project for Mid-Michigan Medical Center–Midland (the Medical Center); plaintiff subcontracted the heating and cooling portion of the project to defendant M.A.P. Mechanical Contractors, Inc. (MAP). MAP obtained a commercial general liability insurance policy (the CGL policy) from defendant Amerisure Insurance Company (Amerisure). Plaintiff and the Medical Center were additional named insureds on the CGL policy. In 2009, MAP installed a steam boiler and related piping for the Medical Center’s heating system. MAP’s installation included several expansion joints. Sometime between December 2011 and February 2012, plaintiff determined that MAP had installed some of the expansion joints backward. Significant damage to concrete, steel, and the heating system occurred as a result. The Medical Center sent a demand letter to plaintiff, asserting that it had to pay for all costs of repair and replacement. Plaintiff sent a demand letter to MAP, asserting that MAP was responsible for all costs of repair and replacement. Plaintiff repaired and replaced the damaged property, at a cost of $1.4 million. Plaintiff then submitted a claim to Amerisure, seeking coverage as an insured. Amerisure denied the claim. The issue this case presented for the Michigan Supreme Court's review centered on whether the unintentional faulty subcontractor work that damaged an insured’s work product constituted an “accident” under a commercial general liability insurance policy. Because the Court concluded the answer was yes, it reversed the Court of Appeals’ judgment to the contrary. View "Skanska USA Building, Inc. v. M.A.P. Mechanical Contractors, Inc." on Justia Law

ACC, the subcontractor on a Corps flood protection project, filed suit against the prime contractor, Hirani, for breach of contract and the providers of Hirani's payment bond, Colonial, under the Miller Act for unpaid labor and materials. The district court entered judgment in favor of ACC and awarded damages against both defendants.The DC Circuit remanded the case to the district court to make findings of fact as to when the Prime Contract was terminated and whether ACC performed labor or supplied material on April 29 and/or April 30. In the event that Colonial and Hirani cannot meet their burden to show that ACC's Miller Act claim was untimely, then this court can resolve the parties' other Miller Act contentions. If Hirani and Colonial show that termination occurred before April 29 or that ACC performed no labor or supplied no material on April 29 or 30, the court can then address the Miller Act statute of limitations issue. The court affirmed the restitution damages award against Hirani on ACC's contract claim where ACC has not provided the court with any basis to deviate from the principle of D.C. law that restitution, not quantum meruit, is the proper remedy where there is an express contract between the parties. The court deferred addressing other issues raised by the parties. View "United States v. Hirani Engineering & Land Surveying, PC" on Justia Law

After defending the general contractor in two construction defect actions, general liability insurer St. Paul Mercury Insurance Company (St. Paul) sought reimbursement of defense costs under an equitable subrogation theory against six subcontractors (defendants) that had worked on the underlying construction projects and whose contracts required them to defend the general contractor in suits involving allegations related to their work. After a bench trial, the court denied St. Paul’s claim. Relying on Patent Scaffolding Co. v. William Simpson Constr. Co., 256 Cal.App.2d 506, 514 (1967), the trial court concluded St. Paul had not demonstrated it was fair to shift all of the defense costs to defendants because their failure to defend the general contractor had not caused the homeowners to bring the construction defect actions. St. Paul argued this conclusion misconstrued the law governing equitable subrogation and therefore constitutes an abuse of discretion. To this, the Court of Appeal agreed: (1) a cause of action based on equitable subrogation allowed an insurer to step into the shoes of its insured and recover only what the insured would be entitled to recover from the defendants; and (2) the appropriate inquiry should have been whether defendants’ failure to defend the general contractor caused St. Paul to incur the defense costs, not whether that failure caused the underlying lawsuits. Judgment was reversed and the matter remanded to the trial court to grant judgment in St. Paul's favor and for a determination of defense costs each defendant owed. View "Pulte Home Corp. v. CBR Electric, Inc." on Justia Law

Colorado Center Development, LLC, the owner of certain property in Denver, Colorado, hired J.E. Dunn Construction Company to construct an office building (the Project). Colorado Center purchased from Defendant Liberty Mutual Fire Insurance Company a Builder’s Risk insurance policy (the Policy). The Policy provided protection against “direct physical loss or damage caused by a covered peril to ‘buildings or structures’ while in the course of construction, erection, or fabrication.” J.E. Dunn hired plaintiff Rocky Mountain Prestress, LLC (RMP) as a subcontractor to perform work including “engineer[ing], supply[ing,] and install[ing] all precast concrete components, connections, and erections aids” and “[s]upply[ing] and install[ing] grout and/or patching of all connections required by the engineering for the structural integrity of the precast.” Because of “potential concerns that arose at another project” relating to “sinking pillars/columns,” J.E. Dunn requested RMP to retain a third-party engineering firm to investigate “potential structural issues” with RMP’s work on the Project. The engineering firm concluded that the Project required “repairs to insufficiently grouted joints between precast concrete column and pilaster elements” at 264 locations throughout the structure. The engineering firm began its investigation in August 2016, and the final grouting repair work was completed in February 2017. In the meantime, in November 2016, RMP submitted a claim to Liberty seeking coverage under the Policy. The district court granted summary judgment in favor of the insurance company on three independent grounds: (1) RMP had not shown that the claimed loss was fortuitous; (2) the claimed loss did not constitute “direct physical loss or damage” as required for coverage under the policy; and (3) even if there might otherwise have been coverage, the claimed loss fell within the policy’s exclusion for defective workmanship. After review, the Tenth Circuit affirmed the district court’s decision based on the defective-workmanship exclusion. View "Rocky Mountain Presstress v. Liberty Mutual Fire Insurance" on Justia Law

Subcontractor Construction Drilling, Inc. (CDI) appealed a trial court’s judgment on the merits in its breach-of-contract claim against Engineers Construction, Inc. (ECI). CDI contended the trial court erred in: (1) holding that the terms of the parties’ subcontract required CDI to request a change order before it billed ECI for “drilling in obstructions” in excess of CDI’s bid price; (2) denying CDI’s motions to reopen the evidence and for a new trial; and (3) awarding ECI $234,320 in attorneys’ fees under the Prompt Payment Act. ECI cross-appealed, arguing the trial court improperly allowed CDI’s owner to offer opinion testimony absent a finding of reliability under Vermont Rule of Evidence 702 and maintaining that his testimony could not have met this standard in any event. Therefore, should the Vermont Supreme Court reverse the trial court’s denial of CDI’s breach-of-contract claim, ECI asserted the matter had to be remanded for a new trial without such testimony. The Court affirmed the trial court, and therefore did not reach the issue raised in ECI’s cross-appeal. View "Construction Drilling, Inc. v. Engineers Construction, Inc." on Justia Law

The Supreme Court affirmed the judgment of the trial court holding that a general contractor was liable for construction materials provided by a supplier to one of the general contractor's subcontractors, holding that the distinct circumstances of this case permitted the supplier to obtain relief for the general contractor's unjust enrichment.General Contractor contracted with Subcontractor to assist with a residential condominium project. Subcontractor agreed to purchase materials from Supplier and to pay Supplier for materials delivered. General Contractor and Subcontractor entered into a joint check agreement specifying a method for how Supplier would be paid for the materials it shipped to the job. Supplier ultimately shipped $252,062 in materials for which it was not paid due to the Subcontractor's financial difficulties. General Contractor ultimately used those materials to complete the project. Supplier sued General Contractor and Subcontractor alleging breach of contract and unjust enrichment. Supplier obtained a default judgment against Subcontractor. After a trial, the court ruled for Supplier in its claim of unjust enrichment against General Contractor. The Supreme Court affirmed, holding (1) the joint check agreement did not foreclose relief; (2) General Contractor was not being compelled to pay twice for the materials; and (3) Supplier was permitted to obtain relief for General Contractor's unjust enrichment. View "Davis Construction Corp. v. FTJ, Inc." on Justia Law

Several insurance companies (the Insurers) appealed the denial of their motions to intervene in a construction defect action between a property owners' association (the Association) and a number of construction contractors and subcontractors (the Insureds). The underlying construction defect action proceeded to trial, resulting in a verdict for the Association. After review, the South Carolina Supreme Court determined the Insurers were not entitled to intervene as a matter of right, and the trial court did not abuse its discretion in denying them permissive intervention. However, the Court held the Insurers had a right to a determination of which portions of the Association's damages are covered under the commercial general liability (CGL) policies between the Insurers and the Insureds. The Court also recognized that the Insurers had the right and ability to contest coverage of the jury verdict in a subsequent declaratory judgment action. "In that action, the Insurers and the Insureds will be bound by the existence and extent of any jury verdict in favor of the Association in the construction defect action. However, they will not be bound as to any factual matters for which a conflict of interest existed, such as determining what portion of the total damages are covered by any applicable CGL policies." View "Builders Mutual Insurance Company" on Justia Law