Reyburn Lawn & Landscape Designers, Inc. v. Plaster Development Co.
255 P.3d 268
Nev.2011Background
- Plaster developed Marble Canyon and hired Reyburn for grading; Reyburn did not design or build the retaining walls or sidewalls.
- Indemnity clause in Reyburn-Plaster contract requires Reyburn to defend and indemnify against liability arising from Reyburn's obligations, with carve-out for sole negligence or sole willful misconduct of Contractor.
- Homeowners sued for defects in walls; Plaster filed third-party complaint against Reyburn seeking indemnity and breach of contract for failing to defend.
- District court granted judgment as a matter of law against Reyburn based on Reyburn owner Stuart Reyburn’s testimony deemed a judicial admission; jury allocated 99% fault to Plaster, 1% to homeowners.
- Trial record included conflicting evidence about Reyburn’s role; Reyburn’s expert testified its work may not have caused the defects; homeowners’ experts attributed most damages to others and to post-construction landscaping.
- Nevada Supreme Court reverses, holding the indemnity clause is not explicit to cover Plaster’s/contributory negligence and that Stuart’s testimony was not a judicial admission; remands for new trial and reallocation of defense costs.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Indemnity scope for contributory negligence | Plaster argues clause indemnifies for non-Solo negligence and contributory fault. | Reyburn contends indemnity covers only Reyburn's negligence; no express language for Plaster's contributory negligence. | Indemnity requires Reyburn's negligence; no coverage for Plaster's contributory/contributory negligence. |
| Judicial admission | Stuart's trial testimony constitutes admission of liability triggering indemnity. | Testimony was not a deliberate, unequivocal admission; evidence should be weighed by jury. | Stuart's testimony was not a judicial admission; issue for the jury. |
| Duty to defend scope | Duty to defend attaches to claims within Reyburn's scope and should cover all defended claims. | Duty to defend limited to claims directly attributed to Reyburn's scope of work; not to others' negligence or Plaster's own negligence. | Duty to defend limited to Reyburn's scope; not all defenses or all negligence claims. |
| Judgment as a matter of law on indemnity | JML was proper because Reyburn admitted liability and no factual disputes remained. | There were genuine conflicts in evidence; JML was inappropriate. | District court erred; issues of fact remain for jury. |
| Attorney fees and costs apportionment | Plaster entitled to all defense costs incurred defending the entire action. | Fees must be apportioned to claims within Reyburn's scope or arising from Reyburn's negligence. | Fees must be apportioned; not all costs awarded without regard to scope of work. |
Key Cases Cited
- George L. Brown Insurance v. Star Insurance Co., 126 Nev. _, 237 P.3d 92 (2010) (indemnity for indemnitee's own negligence requires explicit language)
- Medallion Dev. v. Converse Consultants, 113 Nev. 27, 930 P.2d 115 (1997) (contractual indemnity interpreted strictly; terms govern indemnity)
- Sandy Valley Associates v. Sky Ranch Estates, 117 Nev. 948, 35 P.3d 964 (2001) (distinguishes costs as costs of litigation vs. special damages)
- Crawford v. Weather Shield Mfg., Inc., 79 Cal. Rptr. 3d 721, 187 P.3d 424 (2008) (duty to defend limited to claims within indemnitor's scope; defense cost apportionment)
- Henthorne v. Legacy Healthcare, Inc., 764 N.E.2d 751 (2002) (Indiana approach to defense costs limited to indemnitor's scope of work)
- United Natl. Ins. Co. v. Frontier Ins. Co., 120 Nev. 678, 99 P.3d 1153 (2004) (duty to defend broader than duty to indemnify in some contexts)
- George L. Brown Ins. v. Star Ins. Co., 126 Nev. _, 237 P.3d 92 (2010) (explicit language required to indemnify for sole negligence; contract construed strictly)