Layton Construction Co. v. Shaw Contract Flooring Services, Inc.
2016 COA 155
| Colo. Ct. App. | 2016Background
- Layton was the general contractor on a Vail hotel project; Shaw was a subcontractor whose work was implicated in owner (BCRE) defect claims.
- Layton sued BCRE; BCRE counterclaimed for defects; Layton then sued subcontractors (including Shaw) seeking indemnification under subcontracts for “all damages and costs.”
- In discovery Layton admitted its indemnity claim included Shaw’s alleged failure to defend and pay defense costs; Layton later moved to dismiss its indemnity claim against Shaw "with prejudice." The district court entered dismissal with prejudice.
- After trial in the action against BCRE, Layton obtained relief against some subcontractors for defense costs attributable to their work but later filed a separate suit against Shaw seeking indemnity (including attorney fees and costs) for defense of the prior suit.
- Shaw moved for summary judgment invoking claim preclusion based on the prior dismissal with prejudice; the district court granted summary judgment. The Court of Appeals affirmed and remanded for appellate fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Layton’s current indemnity claims (fees/costs) are identical to claims dismissed earlier | Layton says current claims differ because it did not seek indemnity for fees/costs previously or the claims arise later | Shaw says Layton’s discovery and complaint show it could and did include defense fees/costs in the prior action, so claims are identical | Held: Identity of claims satisfied — Layton could have and did include indemnity for defense fees/costs in the prior case; claim preclusion applies |
| Whether CDARA’s 90‑day tolling provision allows statutory exception to claim preclusion (permits claim-splitting) | Layton contends CDARA requires waiting until after contractor liability is resolved and permits separate later indemnity suits for defense fees | Shaw contends CDARA is a tolling/limitations provision that does not abrogate claim preclusion or authorize splitting when indemnitor was a party | Held: CDARA does not clearly abrogate claim preclusion; it tolls the limitations period but does not permit claim-splitting when indemnity claims could have been brought earlier |
| Whether any exceptions to claim preclusion apply (party agreement, court reservation, statute, continuing wrong) | Layton invokes agreement/waiver, court reservation, CDARA, and continuing harm as grounds to split claims | Shaw responds no agreement or reservation exists; CDARA does not create exception; continuing harm doctrine not applicable | Held: No exception applies — dismissal with prejudice barred the later suit; Layton’s motion and the court’s order did not reserve the claims |
| Whether appeal was frivolous and appellate fees are appropriate | Layton claims novelty of issues justifies appeal | Shaw seeks fees under §13‑17‑102 for frivolous appeal | Held: Appeal was substantially frivolous; remanded to district court to determine reasonable appellate attorney fees for Shaw |
Key Cases Cited
- Argus Real Estate, 109 P.3d 604 (Colo. 2005) (describing claim preclusion elements and requiring clear statutory abrogation to displace the doctrine)
- CLPF‑Parkridge One, L.P. v. Harwell Investments, Inc., 105 P.3d 658 (Colo. 2005) (interpreting CDARA’s 90‑day provision as a tolling/limitations provision that allows but does not force separate indemnity suits)
- Lobato v. Taylor, 70 P.3d 1152 (Colo. 2003) (claim preclusion bars relitigation and splitting of claims)
- Jones v. Sun Carriers, Inc., 856 F.2d 1091 (8th Cir. 1988) (indemnity for costs accrues when indemnitee expends funds)
- Ferrell v. Glenwood Brokers, Ltd., 848 P.2d 936 (Colo. 1993) (attorney fees that are damages must be determined by the trier of fact)
- Sun Indem. Co. of N.Y. v. Landis, 201 P.2d 602 (Colo. 1948) (indemnity rights constitute a single right of action and generally cannot be split)