Builders FirstSource - Southeast Group, LLC v. Hurley Services, LLC
2021-000290
| S.C. Ct. App. | Mar 12, 2025Background
- Plaintiffs (Pavic and Susac-Pavic) sued various parties for construction defects in their Mount Pleasant home, specifically alleging improper installation of windows and related flashing.
- Builders FirstSource-Southeast Group, LLC (BFS) was brought in as a defendant for allegedly defective window installation and cross-claimed against Hurley Services, LLC (Hurley), the subcontractor hired to install the windows.
- BFS sought indemnity, among other claims, from Hurley pursuant to a master subcontract agreement, arguing Hurley was responsible for damages related to the allegedly defective windows provided by BFS.
- Plaintiffs stipulated there was no manufacturing defect in the windows, and BFS dismissed its third-party claim against the manufacturer; thus, the focus was on installation and contract indemnity.
- Hurley moved for partial summary judgment on indemnity-related claims, which the circuit court granted; BFS’s post-trial Rule 59(e) motion was denied.
- BFS appealed, raising various challenges to the circuit court's ruling, primarily concerning enforceability of indemnity provisions, contract characterization, and effects of prior litigation.
Issues
| Issue | BFS's Argument | Hurley's Argument | Held |
|---|---|---|---|
| Validity of Indemnity Provisions under § 32-2-10 | Provisions are enforceable or distinguishable from those invalidated elsewhere | Provisions violate SC public policy by seeking indemnity for BFS's sole negligence | Provisions violate § 32-2-10 and are unenforceable |
| Application of “Clear and Unequivocal” Standard | General contract rules should apply, not heightened standard | Indemnity for own negligence needs to be explicit | “Clear and unequivocal” standard applies; contract language insufficient |
| Characterization as Adhesion Contract | Agreement is not a contract of adhesion or unconscionable | It is a standard, non-negotiable contract of adhesion | Agreement is a contract of adhesion but not unconscionable per se |
| Collateral Estoppel from Prior Litigation | Prior judgment not final (pending appeal); claims distinguishable | Same contract, same legal issue already litigated | Collateral estoppel applies; prior judgment has preclusive effect |
Key Cases Cited
- D.R. Horton, Inc. v. Builders FirstSource - Se. Grp., 422 S.C. 144, 810 S.E.2d 41 (Ct. App. 2018) (indemnity agreements requiring coverage for a party’s own negligence violate public policy)
- Keowee Owners' Ass'n, Inc. v. Builders FirstSource - Southeast Grp., 413 S.C. 630, 776 S.E.2d 434 (Ct. App. 2015) (invalid indemnity where contract seeks to shift liability for own negligence)
- Concord & Cumberland Horizontal Prop. Regime v. Concord & Cumberland, LLC, 424 S.C. 639, 819 S.E.2d 166 (Ct. App. 2018) (sets out "clear and unequivocal" standard for contractual indemnity)
- Simpson v. MSA of Myrtle Beach, Inc., 373 S.C. 14, 644 S.E.2d 663 (2007) (adhesion contract definition under SC law)
- Judy v. Judy, 383 S.C. 1, 677 S.E.2d 213 (Ct. App. 2009) (collateral estoppel bars relitigation of issues previously decided)