Edward Rusnak and Rebecca Rusnak v. Brent Wagner Architects
55 N.E.3d 834
Ind. Ct. App.2016Background
- Edward and Rebecca Rusnak hired Brent Wagner Architects (BWA) in 2006 under AIA B155/A205 forms to design a home and to act as owner’s representative during construction, including site visits and authority to "reject nonconforming Work."
- Sommers was the general contractor; the house was built 2008–2010. Sommers later sued the Rusnaks for unpaid amounts on a promissory note. The Rusnaks third‑partied BWA for breach of contract.
- Discovery revealed multiple alleged nonconformities in the finished home; BWA admitted observing at least one (the front steps). The Rusnaks contend BWA was notified of various defects but failed to take steps to "reject" or assure correction.
- BWA moved for summary judgment, relying on A205 language that it is not responsible for the contractor’s means/methods and cannot be liable for contractor performance. The Rusnaks opposed, arguing BWA had a contractual duty to reject nonconforming work and that factual disputes remain.
- While summary judgment was fully briefed, the Rusnaks sought leave to amend to add a design defect claim based on discovery (foundation overloading). The trial court granted summary judgment to BWA on the breach claim and denied leave to amend; the Rusnaks appealed.
Issues
| Issue | Plaintiff's Argument (Rusnak) | Defendant's Argument (BWA) | Held |
|---|---|---|---|
| Whether BWA was entitled to summary judgment on the third‑party breach‑of‑contract claim | BWA had contractual duties during construction (site observation, reject nonconforming work, certify payments); factual disputes exist about whether BWA rejected or otherwise acted on known defects | A205 exculpatory language shields BWA from liability for contractor means/methods and contractor performance, so BWA cannot be liable for Sommers’ defects | Reversed: genuine issue of material fact exists about what "reject nonconforming Work" requires and whether BWA met that duty; summary judgment improper |
| Whether the trial court erred denying leave to amend to add a design‑defect claim | Amendment was timely (statute of limitations hadn’t run), based on discovery, no prior amendments, and no undue prejudice to BWA | Untimely and prejudicial because BWA’s summary judgment motion had been fully briefed and a hearing was pending | Reversed: trial court abused discretion; denial prejudiced the Rusnaks and allowing the claim would not unduly prejudice BWA |
Key Cases Cited
- Hughley v. State, 15 N.E.3d 1000 (Ind. 2014) (summary judgment burdens and de novo review)
- Gill v. Evansville Sheet Metal Works, Inc., 970 N.E.2d 633 (Ind. 2012) (nonmoving party must show genuine factual dispute)
- Johnson v. Johnson, 920 N.E.2d 253 (Ind. 2010) (ambiguity in contract leaves construction to factfinder)
- Hilliard v. Jacobs, 927 N.E.2d 393 (Ind. Ct. App. 2010) (trial court discretion and factors for denying leave to amend)
- Kreilein v. Common Council of City of Jasper, 980 N.E.2d 352 (Ind. Ct. App. 2012) (policy favoring liberal amendment of pleadings)
- Storch v. Provision Living, LLC, 47 N.E.3d 1270 (Ind. Ct. App. 2015) (contract construed to avoid rendering terms meaningless)