David v. Hett
270 P.3d 1102
| Kan. | 2011Background
- Davids sued Hett Construction for negligence, breach of contract, fraud, and C P Act after discovering home settlement years later.
- District court granted summary judgment on contract, C P Act, and fraud claims; negligence barred by economic loss doctrine.
- Court of Appeals affirmed; this court reviews whether economic loss doctrine applies to homeowners against residential contractors.
- Kansas precedent recognizes homeowners may sue in tort or contract, or both, depending on the duty alleged.
- Court overruled Prendiville v. Contemporary Homes, Inc. and remands to determine whether Davids’ claims arise from a tort duty independent of contract.
- Record insufficient to determine if any independent tort duty was pled; district court must assess the duty source on remand.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the economic loss doctrine bar homeowners' tort claims against a residential contractor? | Davids argue doctrine does not bar because duties arise independently of contract. | Hett contends doctrine bars tort claims where only economic losses rest on contract. | No; doctrine does not bar if independent tort duty exists. |
| Are Davids' claims properly characterized as tort or contract, based on the duty alleged? | Claims arise from breach of implied/express duties in construction work. | Claims arise solely from contract performance; thus barred by doctrine. | Remand to determine if a common-law or statutory duty independently supports negligence. |
| Should Prendiville be overruled to permit tort claims against residential contractors? | Prendiville should not constrain homeowners’ tort rights against contractors. | Prendiville aligns with doctrine and policy concerns. | Prendiville overruled; remand to assess tort vs. contract based on duties. |
Key Cases Cited
- East River S.S. Corp. v. Transamerica Delaval, Inc., 476 U.S. 858 (U.S. 1986) (economic loss rule originated to separate tort from contract in product cases)
- Prendiville v. Contemporary Homes, Inc., 32 Kan. App. 2d 435 (Kan. App. 2004) (extended economic loss doctrine to residential construction; later overruled)
- Koss Construction v. Caterpillar, Inc., 25 Kan. App. 2d 200 (Kan. App. 1998) (economic loss doctrine applies to damage to product itself)
- Gilley v. Farmer, 207 Kan. 536 (Kan. 1971) (establishes dual tort/contract theory for service contracts)
- Malone v. University of Kansas Medical Center, 220 Kan. 371 (Kan. 1976) (duty-based test for whether action sounds in tort or contract)
- Tamarac Dev. Co. v. Delamater, Freund & Assocs., 234 Kan. 618 (Kan. 1984) (recognizes dual tort/contract theory in construction context)