P.A.L. Environmental Safety Corp. v. North American Dismantling Corp. Et Al., No. 19-11630, 2020 BL 198779 (E.D. Mich. May 28, 2020)

A Michigan federal court partially granted Consumers Energy Company’s (“CEC”) motion to dismiss P.A.L. Environmental Safety Corporation’s (“PAL”) complaint alleging numerous causes of action in connection with its suit against CEC and contractor North American Dismantling Corporation (“NADC”) for outstanding payment stemming from asbestos abatement work at a CEC-owned power plant in Essexville, Michigan (the “Power Plant”).

According to the decision, CEC, as owner, and NADC, as prime contractor, entered into a written contract whereby NADC agreed to abate, dismantle, and demolish the Power Plant.  In turn, NADC subcontracted with PAL to perform abatement of all asbestos containing material at the Power Plant.  While the subcontract price was $7,996,331, PAL alleged entitlement to an adjusted price of $23,841,833 in unpaid labor and materials for its asbestos abatement work.  Specifically, PAL alleges that it performed additional work not accounted for in the subcontract including fly ash and coal dust removal, refractory brick abatement, and extra asbestos removal.

While PAL’s complaint included numerous counts against Defendants NADC, CEC, and labor and material payment bond surety North American Specialty Insurance Company (“NASIC”), the opinion is most notable for its treatment of CEC’s motion to dismiss several counts against it including: (i) quasi-contractual claims; (ii) a third-party breach of contract claim; and (iii) a negligent misrepresentation claim.
Continue Reading Michigan Federal Court Permits Subcontractor’s Quasi-Contractual Claims to Proceed Despite Existence of Express Contract Covering the Same Subject Matter

Gables Construction, Inc. v. Red Coats, Inc., No. 23, 2020 BL 193791, 2020 MD LEXIS 264 (Md. May 26, 2020)

Upper Rock II, LLC (“Upper Rock”) contracted Gables Construction, Inc. (“GCI”) to construct a multi-building apartment complex in Rockville, Maryland (the “Project”) per the terms of the American Institute of Architects (“AIA”) A102TM-2007, Standard Form Agreement Between Owner and Contractor and AIA A201TM – 2007, General Conditions of the Contract for Construction.  The General Conditions required Upper Rock to purchase and maintain a property insurance policy.  It also contained a waiver of subrogation provision under which Upper Rock waived all rights against GCI and other Project participants for damages caused by fire to the extent covered by insurance.
Continue Reading Maryland Court Holds No Right of Contribution Where a Waiver of Subrogation Precludes Common Legal Responsibility

Precision Hydraulic Cylinders, Inc. v. Manufacturing. Technology, Inc., No. 7:18-CV-203-FL, 2019 BL 344743, 2019 U.S. Dist. LEXIS 156670 (E.D.N.C. Sept. 13, 2019)

Precision Hydraulic Cylinders, Inc. (“Precision”) issued a series of purchase orders to Manufacturing Technology, Inc. (“MTI”) to weld steel components together to create hydraulic cylinders. MTI agreed to develop welds for Precision’s small and large cylinders under two separate purchase orders.

Continue Reading North Carolina Federal District Court Dismisses Tort Claims Based on Same Duty and Breach Alleged in Plaintiff’s Contract Claims

United Illuminating Company v. Whiting-Turner Contracting Co. v. Cherry Hill Construction Co., Inc., et al. v. GEI Consultants, Inc., et al., 3:18-cv-00327-WWE (D. Conn. 2019)

In 2010 The United Illuminating Company (“UI”), an electric utility company, and Whiting-Turner, a construction contractor, entered into a general contractor agreement for the construction of the United Illuminating Central Facility Project (the “Project”) in Orange, Connecticut.  The Project required construction of an office building, an operations building, and related parking lots and common driveways.  Whiting-Turner and Cherry Hill Construction Co. (“Cherry Hill”), a heavy civil construction contractor, then entered into a subcontractor agreement which required Cherry Hill to perform site work.

Continue Reading Courts Decline to Impose Liability on Subcontractor Where Contractor Could Not Prove Subcontractor’s Exclusive Control on Shared Project Site

DAK Americas Mississippi, Inc. v. Jedson Engineering, Inc. et al, No. 1:18cv31-HSO-JCG, 2019 BL 208838 (S.D. Miss. June 6, 2019)

This dispute arose out of the design and construction of a concrete storage slab at DAK’s polymer resin manufacturing facility located in Hancock County, Mississippi.  DAK hired Ohio-based Jedson to design and oversee the construction of a cement slab suitable for commercial operating loaders and other heavy equipment necessary to transport, unload, and stack shipping containers.  DAK allegedly discovered substantial cracking and chipping of the cement, and filed suit in federal court claiming Jedson failed to design a slab suitable for DAK’s intended purposes.  DAK asserted claims for negligent design, negligent construction management, and breach of contract.

Continue Reading Federal Court Finds That Ambiguous Limitation-of-Liability Clause Did Not Clearly Restrict Owner’s Claims

Popple Construction, Inc. v. Reilly Associates, Inc. No. 775-MDA-2017, 2019 BL 213236 (Pa. Sup. Ct., June 10, 2019).

On June 10, 2019, the Superior Court of Pennsylvania affirmed a lower court decision to deny a motion to dismiss in connection with a tort claim for negligent misrepresentation by a contractor against a third-party design/engineer.  The Court’s opinion highlights Pennsylvania’s exception to the economic loss doctrine insofar as it applies to claims raised by contractors against architects/engineers for faulty bidding documents, specifications, or designs.

Continue Reading Pennsylvania’s Exception to the Economic Loss Doctrine Appears Alive and Well: Appellate Court Permits Contractor to Pursue Negligent Misrepresentation Claim Against Design Professional

Dolan v. Hurd Millwork Co., No. 2951 EDA 2015, 2019 BL 229344 (Pa. Super. Ct. June 21, 2019)

This cases arises out of defective windows installed in a residential construction project. In 1999, Leo J. Dolan purchased a custom home from Bentley Homes, Ltd. and its affiliates (“Bentley Homes”).  Hurd Millwork Company, Inc. provided many of the home’s windows.   Dolan almost immediately observed issues in the home’s construction, including air and water leaks around the windows.   Bentley Homes, however, led him to believe the issues had been fixed.

Continue Reading Pennsylvania Appellate Court Affirms Homeowner’s Recovery Against Developer on Tort Claims, Despite Contract and Challenges Based on Gist of the Action Doctrine, Economic Loss Rule, and Statute of Limitations

Team Contractors, LLC v. Waypoint Nola, LLC, No. 16-1131, 2019 BL 96133 (E.D. La. Mar. 20, 2019)

The Eastern District of Louisiana recently denied the motion of a prime contractor (the “Contractor”) for summary judgment on its breach of contract claim against the owner (the “Owner”) of a construction project in New Orleans (the “Project”) where the primary issue involved whether a suspensive condition was enforceable.

Continue Reading Federal Court in Louisiana Upholds Suspensive Condition Not Subject Solely to Owner’s Whim

Skyrise Construction Group, LLC v. Annex Construction, LLC, 2019 BL 55071 (E.D. Wis. Feb. 20, 2019)

Subcontractor Skyrise Construction, Inc. (“Skyrise”) sued general contractor Annex Construction, Inc. (“Annex”) for breach of contract, promissory estoppel, negligent misrepresentation, and violations of Wisconsin and Illinois trade practices statutes.  Skyrise primarily based its claims on an assertion that the parties entered into a subcontract, which Annex breached when it removed Skyrise from the project and completed the work with an alternative subcontractor.  Both Skyrise and Annex filed motions for summary judgment.  The District Court denied Skyrise’s motion and granted Annex’s motion.

Continue Reading District Court in Wisconsin Finds That Counteroffer and Repeated Negotiations Concerning a Construction Contract Do Not Create Contractual Relationship

Dep’t of Transp. v. Seattle Tunnel Partners, 2019 BL 36988, 2 (Wash. App. Div. 2 Feb. 05, 2019)

On January 8, 2019, the Court of Appeals for the State of Washington reversed and remanded in part a trial court’s grant of summary judgment in a tunnel-boring construction case.  Specifically, the Court clarified that the three-year statute of limitations for negligence claims begins to run as soon as the aggrieved party becomes aware of the factual elements of the claims.  It does not matter whether the underlying cause of the claims remains disputed.

Continue Reading The Washington Court of Appeals Clarifies When the Statute of Limitations for a Negligence Claim Begins to Run Under the Discovery Rule