R&O Constr. Co. v. MBA Gen. Contracting, LLC, No. 1:18-cv-00042, 2019 BL 98680 (D. Utah Mar. 21, 2019)

On March 21, 2019, a Utah federal court granted Defendants MBA General Contracting, LLC and Cory Martin’s motion to dismiss R&O Construction Company’s claim for attorney fees.
R&O, as general contractor of a construction project, entered into two subcontracts with MBA to perform concrete work.  The first subcontract, entitled Master Subcontract Agreement, outlined general obligations between the parties.  The second, entitled Work Authorization Document, outlined more specific obligations.  R&O asserted various causes of action against MBA arising from MBA’s alleged breach of the subcontracts, including a claim for attorney fees.  MBA moved to dismiss the attorney fees claim, arguing that neither subcontract provides for such an award.

Continue Reading Utah Federal Court Dismisses Claim for Attorney Fees Finding That Neither the Indemnification Provision nor the Failure-To-Perform Provision Applies to a Lawsuit Between Contractor and Subcontractor

Martin K. Eby Constr. Co., Inc. v. OneBeacon Ins. Co.,  
2012 U.S. Dist. LEXIS 131875 (D. Kan. Sept. 17, 2012)

Eby was the contractor for a project to build a water pipeline in Texas. KBR was the construction manager on the project. In the Indemnity Provision of the water pipeline project contract:

Eby agree[d] to indemnify and hold harmless KBR from and against any damages, claims, demands, suits, and judgment costs including attorney’s fees and expenses for or on account of damage to property directly or indirectly arising from or caused in connection with the work by Eby.”

Celanese, the owner of a methanol pipeline in the area near the project, sued Eby and KBR for negligence after the methanol pipeline leaked during the construction of the water pipeline. A jury determined that KBR was not liable to Celanese and that Eby’s actions caused the damage. But, KBR incurred attorney’s fees defending against the suit and sought to recover those fees from Eby under the Indemnity Provision.

Continue Reading U.S. District Court In Kansas (Applying Texas Law) Holds That Indemnity Clause Which Failed to Call Out Indemnitee’s Negligence Did Not Afford Indemnity for Attorneys’ Fees Even Where Indemnitee Sued for Negligence Was Found Not Negligent

Fortney & Weygandt, Inc. v. American Manufacturers Mutual Insurance Co.
2010 U.S. App. Lexis 2836 (6th Cir. Feb. 12, 2010)

The United States Court of Appeals for the Sixth Circuit recently held that where a contractor’s defective foundation work required complete demolition and rebuilding of project that the defective work exclusion of commercial general liability policy did not preclude coverage for destruction of portions of the building not defectively constructed.

Continue Reading U.S. Court of Appeals for 6th Circuit Holds Contractor’s Liability Policy Afforded Coverage for Property Damage To Other Portions of Building Arising Out of Defective Foundation Work

Jalapenos, LLC v. GRC General Contractor, Inc.,
2007 PA Super 391, 2007 Pa. Super. LEXIS 4411 (Dec. 19, 2007)
Jalapenos, LLC, hired GRC General Contractor, Inc. to remodel a restaurant. The parties signed standard American Institute of Architects contracts (AIA Forms A101 and A201 – 1997). Under the contract, Jalapenos was required to obtain Builder’s Risk “all-risk” property insurance or equivalent, or inform the contractor in writing before the work began if it did not intend to purchase such insurance. Furthermore, if GRC was damaged by Jalapenos’ failure to maintain the required insurance without notifying GRC, then Jalapenos would be liable for all reasonable costs attributable to such failure.

Continue Reading Pennsylvania Superior Court Holds That Under AIA Contract Requiring Owner to Purchase Builders Risk Insurance, Contractor Not Liable for Fire Damage Caused By Subcontractor’s Negligence Despite Owner’s Failure to Purchase the Insurance

17 Vista Fee Assocs. v. Teachers Ins. and Annuity Assoc. of America,
1999 N.Y. App. Div. LEXIS 7981 (July 15, 1999)
The plaintiffs/third-party plaintiffs 17 Vista Fee Associates and 17 Vista Associates (“17 Vista”) entered into a sale agreement with defendant Teachers Insurance and Annuity Association of America (“TIAA”), pursuant to which 17 Vista was to construct an office building at 17 State Street in Manhattan, and to sell it to TIAA upon completion. To obtain a certificate of occupancy for the building, the sales agreement required 17 Vista to perform several tasks, including construction of the building’s smoke purge system. 17 Vista retained Third-Party Defendant Jaros Baum & Bolles (“JB&B”), a mechanical engineer, to perform design services for the building.
Continue Reading The Appellate Division of the Supreme Court of New York holds that seller of a building may seek indemnification from a mechanical engineer whose negligent design caused seller to have to pay the new owner for costs arising out of the design flaws. The Court also holds that the economic loss doctrine did not bar a claim for professional malpractice.