Judge Paul King of the Douglas County District Court recently confirmed that subcontractors in residential construction owe an independent duty,
separate and apart from any contractual duties, to act without negligence in
the construction of a home in Colorado. See Order, dated September 7, 2010, Sunoo
v. Hickory Homes, Inc. et al.,
Case No. 2007CV1866; see also Cosmopolitan
Homes, Inc. v. Weller, 663 P.2d 1041 (Colo. 1983); A.C. Excavating v.
Yacht Club II Homeowners Ass’n, Inc., 114 P.3d 862 (Colo. 2005). He also verified that the holding in the B.R.W.
Inc. v. Dufficy & Sons, Inc., 99 P.3d 66 (Colo. 2004)[1]
case does not prohibit general contractors, such as Hickory Homes, from
enforcing a subcontractor’s independent duty to act without negligence in the
construction of a home. In his Order,
Judge King stated:
The independent duty to construct
in a non-negligent manner is not dependent on the nature of the party
presenting the claim in residential contract.
It is independent of any agreement and there is nothing that precludes
the homeowner or the general contractor from seeking to enforce it in a
residential homeowner setting.
See
Order, Sunoo v. Hickory Homes, Inc. et al.,
p. 7.
In the Hickory Homes case, an
excavation subcontractor filed a motion for partial summary judgment on
Hickory’s third-party claims for negligence, contribution, and breach of
implied warranty. The excavation
subcontractor argued that Hickory’s claims for negligence and contribution were
barred by the Economic Loss Rule as a contract existed between it and
Hickory. Hickory asserted that the
excavation subcontractor is subject to an independent duty that can form the
basis of any tort claim, which bars summary judgment. Judge King agreed, and denied the excavation subcontractor’s motion for partial
summary judgment.
Another subcontractor joined the
excavation subcontractor’s motion for partial summary judgment concerning
Hickory’s breach of implied warranty claim, arguing that the implied warranty
of habitability did not apply to it.
Hickory clarified that the breach of implied warranty claims were not
predicated upon said warranty of habitability.
Rather, Hickory’s claims of breach of implied warranty arise out of
implied warranties of merchantability and fitness for a particular
purpose. The court found it undisputed
that this subcontractor provided goods in connection with its work on the plaintiffs’
home. Accordingly, Judge King found that
an implied warranty of merchantability and fitness applied to those goods and
denied the subcontractor’s joinder in the motion for partial summary judgment. Judge King’s Order serves as further
confirmation that subcontractors engaged in residential construction in
Colorado are subject to the same independent duty applicable to builders.
Additionally, in his Order, Judge
King verified that the trial court should follow the criteria set forth in the Redden
v. SCI Colorado Funeral Services, Inc., 38 P.3d 75 (Colo. 2001) case in
determining whether to permit designations of nonparties beyond statutory time
frame allowed, or within 90 days after commencement of the action. C.R.S. § 13-21-111.5(3)(b) provides that the
negligence or fault of a nonparty may be considered if the claimant entered
into a settlement agreement with the nonparty or if the defending party gives
notice that the nonparty was wholly or partially at fault within 90 days
following the commencement of the action unless the court determines a longer
period is necessary. In the Hickory
Homes Order, Judge King indicated that the trial court should, in
accordance with Redden, “strive to promote justice and should be guided
by the following three criteria: 1) was the neglect excusable; 2) was there a
meritorious claim; and 3) whether the designation would be consistent with
equitable considerations.” See Order, Sunoo v. Hickory Homes,
Inc. et al., p. 2.
Hickory sought to designate
several potential nonparties at fault outside of the 90-day time frame allowed
by statute following its receipt of expert reports from the plaintiffs. As such, the court found Hickory’s delay in
seeking to designate the nonparties excusable.
Id. at p. 3. Hickory
argued that provisions in the contract dictate that the owners were responsible
for certain construction elements, including the structural floor system. As a result, the court found that Hickory had
established a meritorious claim. As the
plaintiffs did not raise structural or geotechnical issues until its experts’
second reports, the court found that equitable considerations favored granting
Hickory permission to make its nonparty designations and thereby granted its
motion for leave. For those of us
defending construction defect cases, the opportunity to designate nonparties
following the receipt of a plaintiff’s expert report(s) is, in many instances,
extremely vital to our client’s defense and almost always outside the statutory
time frame of 90 days. Accordingly, it is
reassuring to see the Douglas County District Court give consideration to the
timing predicaments facing construction defect defendants.
For additional information regarding Colorado construction litigation, please contact David M. McLain at (303) 987-9813 or by e-mail at mclain@hhmrlaw.com.
[1]
In
the B.R.W. Inc. case, the Colorado Supreme Court held that the Economic Loss
Rule barred the steel subcontractor’s negligence claims against the engineering
firm and inspector for a public works project, even though the subcontractor
had not directly contracted with the engineering firm or inspector.
No comments:
Post a Comment