Articles Posted in Construction Law

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ICI Homes, Inc. (ICI) had a general liability insurance policy with General Fidelity Insurance Company. In 2007, Katherine Ferrin, the owner of a residence constructed by ICI, was injured while using stairs installed by Custom Cutting, Inc. Ferrin filed suit against ICI. ICI, in turn, sought indemnification from Custom Cutting. The parties agreed to a $1.6 million settlement of Ferrin’s claim. ICI accepted $1 million from Custom Cutting’s insurer to settle its indemnification claim, which it paid to Ferrin. ICI and General Fidelity then claimed the other was responsible for paying Ferrin the remaining $600,000. Both parties paid $300,000 to Ferrin to settle Ferrin’s claim. ICI then filed suit against General Fidelity seeking return of the $300,000 ICI paid above the $1 million indemnification payment. General Fidelity counterclaimed seeking return of the $300,000 it had paid to Ferrin. The district court entered judgment for General Fidelity. The court of appeals certified two questions to the Supreme Court for resolution. The Supreme Court answered (1) the General Fidelity policy allowed ICI to apply indemnification payments received from Custom Cutting’s insurer towards satisfaction of its $1 million self-insured retention; and (2) the transfer of rights provision in the policy did not abrogate the made whole doctrine.View "Intervest Constr. of Jax, Inc. v Gen. Fidelity Ins. Co." on Justia Law

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Lakeview Reserve Homeowners Association filed an action against Maronda Homes, Inc. for breach of the implied warranties of fitness and merchantability (referred to as the implied warranty of habitability in the residential construction context) arising from alleged defects in the development and construction of a residential subdivision that Maronda Homes developed. Maronda Homes filed a third-party complaint against T.D. Thomson Construction Company for indemnification based on the alleged violation of the implied warranties. The trial court entered summary judgment in favor of Maronda Homes and T.D. Thompson on the basis that the common law implied warranties of fitness and merchantability do not extend to the construction and design of the infrastructure, private roadways, drainage systems or other common areas in a residential subdivision because those structures do not immediately support the residences. The court of appeal reversed, holding that the common law warranty of habitability was applicable in this case. The Supreme Court affirmed, holding that the implied warranties of fitness and merchantability applied to the improvements that provided essential services to the homeowners association. Remanded.View "T.D. Thomson Constr. Co. v. Lakeview Reserve Homeowners Ass'n, Inc." on Justia Law

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Lakeview Reserve Homeowners Association filed an action against Maronda Homes for breach of the implied warranties of fitness and merchantability, also referred to as the implied warranty of habitability in the residential construction context. The underlying cause of action arose from alleged defects in the construction and development of a residential subdivision that Maronda Homes and T.D. Thomson Construction Company developed. Lakeview Reserve served as the homeonwers association of the division. Maronda Homes filed a third-party complaint against T.D. Thomson for indemnification based on the alleged violations by Maronda Homes. The trial court entered summary judgment in favor of Maronda Homes and T.D. Thompson, finding that the common law implied warranties of fitness and merchantability do not extend to the construction and design of the private roadways, infrastructure, or any other common areas in a residential subdivision. The court of appeal reversed, holding that the common law warranty of habitability applied in this case. The Supreme Court affirmed, holding that the implied warranties of fitness and merchantability applied to the improvements that provided essential services to the homeowners association. Remanded. View "Maronda Homes, Inc. of Fla. v. Lakeview Reserve Homeowners Ass'n" on Justia Law

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Compass Construction and First Baptist Church were named as defendants in an action arising from a construction accident. Ultimately, First Baptist prevailed against the plaintiff in the main action and on its cross-claim for indemnity against Compass. First Baptist was awarded attorneys fees as part of its indemnity claim, but the parties disagreed about the appropriate hourly rate at which the fee for First Baptist's attorney should be calculated. In the main action, First Baptist's insurance company assigned an attorney to represent First Baptist. The attorney had a written fee agreement with the insurance company providing that attorney would be paid $170 per hour. In an alternative fee recovery clause, however, the agreement provided that if anyone other than the insurance company was required to pay attorney's fees, the attorney's hourly rate would be $300. The trial court calculated the award at the higher rate. The court of appeal reversed. The Supreme Court reversed, holding that the alternative fee recovery clause was valid. Remanded for reinstatement of the judgment awarding attorney's fees. View "First Baptist Church of Cape Coral, Fla., Inc. v. Compass Constr., Inc." on Justia Law

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In 2004, Defendant, a general contractor, subcontracted with Plaintiff, who was unlicensed under Florida law at the time, to perform work on a parking garage. After a dispute, Plaintiff sued Defendant for breach of contract. Defendant counterclaimed for breach of contract. During litigation, Defendant argued that because Plaintiff was unlicensed, its breach of contract claim was barred under Fla. Stat. 489.128, which provides that contracts entered into by an unlicensed contractor shall be unenforceable. Plaintiff countered that Defendant was also barred from enforcing the contract because the parties were in pari delicto based on Defendant's alleged knowledge of Plaintiff's unlicensed status. The trial court ruled against Plaintiff, holding that the common law defense of in pari delicto was unavailable under section 498.128. The fifth district court of appeal affirmed. The Supreme Court affirmed, holding that a party's knowledge that a contractor or subcontractor does not hold the state-required license to perform the construction work of the contract is legally insufficient to establish the defense that the parites stand in pari delicto. In so holding, the Court expressly disapproved the third district court of appeals' decision in Austin Building Co. v. Rago, Ltd., which directly conflicted with the fifth district's decision. View "Earth Trades, Inc. v. T&G Corp." on Justia Law

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Petitioner requested a judgment of acquittal on the charge of felony criminal mischief where defense counsel argued that the state failed to establish a prima facie case that the damage to the doors that petitioner drove into was one thousand dollars or more, the threshold amount for the felony charge. At issue was whether the Third District Court of Appeal properly relied on a "life experience" exception to the general rule that a state must establish the amount of damage to prove felony criminal mischief. The court quashed the Third District's decision, disapproved of Jackson v. State, and other decisions in this context that applied to the "life experience" exception and held that before a defendant could be convicted of felony criminal mischief, the state must prove the amount of damage associated with the criminal conduct.