Stonegate Homeowners Ass'n v. StabenStonegate Homeowners Ass'n v. Staben
Opinion
In this construction defect case, the general contractor hired a subcontractor to waterproof retaining walls and install backdrains in a large residential development. After discovering seepage and drainage problems, the homeowners association sued the general contractor and the subcontractor for negligence. During a jury trial, the subcontractor’s motion for nonsuit was granted and judgment was entered in its favor. On appeal, the homeowners association and the general contractor contend that the trial court erroneously precluded expert testimony on the
FACTUAL AND PROCEDURAL BACKGROUND
This action arises out of the construction of a 238-home residential development in
At trial, Ron Palacios testified that he told Tom Staben to “waterproof [the walls] with Thoroseal,” install four-inch subsurface drain lines, backfill the walls with sand and lay “v-ditches.” Mr. Palacios testified that he did not know how to apply Thoroseal and that he told Mr. Staben to apply it according to the manufacturer’s specifications. He later testified that he never had a conversation with Mr. Staben about how the Thoroseal should be applied. He also testified that he did not tell Mr. Staben how to install the drains. Mr. Palacios further testified: “I don’t tell [Mr. Staben] how to do his job,” explaining that Mr. Staben was a “professional.”
Mr. Staben testified that he was not given any specifications as to how to apply the Thoroseal to the walls at the Stonegate project and that he was only told to apply it “the same way” he had at the “Moorpark project,” which involved the same developer. But Mr. Palacios testified he had not worked on the Moorpark project and that he was unaware of how Staben did the work on the Moorpark project.
In late 1989, Staben completed the waterproofing and drainage installation on the walls Palacios built at the Stonegate project. Palacios paid Staben for its work and did not have any problems with the work. After the work was completed, homeowners in the development began to notice wet soil or boggy conditions in their yards together with dampness on the downhill side of the retaining walls and a white powdery substance on the walls called “efflorescence.” In 1999, appellant The Stonegate Homeowners Association (Stonegate) filed suit against the developer and others for negligence, strict liability and implied warranty, alleging that the retaining walls had been defectively waterproofed and drained. Stonegate later substituted Palacios and Staben in place of fictitiously named defendants. The trial court dismissed the strict liability and warranty claims, leaving only the negligence cause of action to be tried. Palacios cross-complained against Staben for indemnity, contribution and declaratory relief.
Stonegate eventually settled or disposed of its claims against all defendants except Staben. Palacios entered into a sliding scale or
Mary Carter
settlement agreement
(Booth v. Mary Carter Paint Co.
(Fla.Dist.Ct.App. 1967)
During trial, Stonegate attempted to present expert witness testimony on the standard of care in applying Thoroseal and in installing a subsurface backdrain and that Staben’s work fell below those standards. The trial court precluded the testimony, ruling that the relevant issue was not the standard of care, but the oral contract between Palacios and Staben and what Staben was told to do under that agreement. The court deemed Palacios to be the “gatekeeper” and stated that Palacios should be responsible for any defects.
At the close of Stonegate’s evidence, Staben orally moved for nonsuit on the grounds that “there is no conflict in the evidence that Mr. Staben’s duty was to do
Following entry of judgment in its favor, Staben moved for summary judgment on Palacios’s severed cross-complaint for indemnity, arguing that because Staben fulfilled its obligations under the oral agreement with Palacios, the requisite predicate tort to maintain an action for equitable indemnity was absent. The trial court agreed, granting the motion and entering summary judgment in favor of Staben. The court then awarded costs to Staben in the amount of $78,937.52—the same amount the court had awarded against Stonegate. Palacios appeals from both the summary judgment on its cross-complaint and the award of costs. Stonegate’s and Palacios’s appeals have been consolidated.
DISCUSSION
I. THE NONSUIT MOTION
Stonegate and Palacios contend the trial court erred in granting the nonsuit because expert testimony on Staben’s standard of care should have been admitted. 1
A. Standard of Review
“A motion for nonsuit allows a defendant to test the sufficiency of the plaintiff’s evidence before presenting his or
In reviewing a grant of nonsuit, we are “guided by the same rule requiring evaluation of the evidence in the light most favorable to the plaintiff.”
(Carson v. Facilities Development Co., supra,
B. The Trial Court Erred in Precluding Expert Testimony on Staben’s Duty of Care
1. Trial Court Proceedings
It was Stonegate’s position at trial that Staben was responsible for two major defects in construction of the retaining walls: inadequate waterproofing and improper placement of backdrains.
a. Inadequate Waterproofing
Stonegate argued that inadequate waterproofing with Thoroseal permitted hillside drainage to seep into and through the concrete blocks of the walls and caused the formation of sulfate efflorescence that threatened the structural integrity of the walls. Tom Staben acknowledged that the
Roberts tried to explain the standard of care in applying Thoroseal to the walls, and that Staben’s work fell below that standard. But the trial court ruled that standard of care in the industry was not relevant, based on its conclusion that the terms of the oral contract between Palacios and Staben established Staben’s responsibilities. The court sustained objections to Roberts’s testimony that would have explained how a contractor would ordinarily go about preparing and applying Thoroseal.
The day following Roberts’s testimony, Stonegate filed a motion for reconsideration, which included an offer of proof that Roberts would testify that Staben failed to meet the manufacturer’s specifications for applying Thoroseal that appeared on every bag of Thoroseal when Staben did his work. Among these specifications was the requirement for application of two coats to ensure complete coverage. The court denied the motion, stating that it had no recollection that Ron Palacios had told Tom Staben to apply the Thoroseal according to the manufacturer’s instructions.
b. Improper Placement of Drains
Stonegate sought to establish that Staben installed the subsurface backdrains too high above the foundation, which rendered the drains largely useless because water would accumulate behind the walls and flow through “weep” holes or “open head” joints before rising to the level of the backdrains. This created wet or boggy soil conditions in the owners’ yards. Mr. Staben admitted that it was his “personal feeling” that the drains should have been placed right on top of the footing. He testified that he believed a city building inspector told him to install the drains at an angle, which he did, though he thought such placement was “incorrect.” Stonegate’s drainage expert, Mohammad Joolezadah, testified that during his inspection of the site he observed drains placed at various heights above the footing, with one drain as high as 22 inches above the footing.
Joolezadah was prepared to testify that the standard of care was to place the drains horizontally along the footing with a two-inch bed of gravel below and that Staben’s placement of the subsurface backdrains was too high and fell below the standard of care. But the trial court precluded this testimony, refusing to allow Stonegate’s experts to “go beyond” the oral contract to establish any standard of care on Staben’s part.
2. Subcontractor’s Standard of Care
Appellants contend that the court erred in narrowing its focus on the words of the oral agreement to the exclusion of evidence on the standard of care. We agree. “The subcontractor has a duty to perform work in a good and workmanlike manner. A subcontractor who is careless and negligent in the performance of the work is liable to the general contractor, to the owner, and to third persons for
In
Stewart v. Cox
(1961)
Standard of care and its breach in the construction defect context must usually be established through expert testimony, though lay testimony may suffice where construction defects “are of such common knowledge that men of ordinary education could easily recognize them.”
(Raven’s Cove Townhomes, Inc. v. Knuppe Development Co.
(1981)
We conclude that the trial court erred in precluding Stonegate from presenting expert testimony on Staben’s standard of care. Staben agreed to perform the waterproofing and drainage work on the retaining walls built by Palacios and had the duty to perform those tasks in a good and workmanlike manner. As such, the testimony of Stonegate’s experts was relevant to the issue of whether Staben met the standard of care expected within the industry. The trial court’s focus on the terms of the oral agreement to the exclusion of the standard of care evidence puts contractors like Palacios in an untenable position. The evidence showed that Palacios did not know how to do portions of the work subcontracted to Staben and therefore did not tell Staben how to perform its work. But under the trial court’s theory, Staben would only be liable for defects in its work if Palacios had given it
Because evidence that Staben’s work fell below the standard of care in the construction industry could have enabled Stonegate to overcome the nonsuit on its negligence claim, the judgment in favor of Staben must be reversed.
(Castaneda v. Bornstein,
supra,
B. SUMMARY JUDGMENT MOTION
Palacios also challenges the trial court’s grant of summary judgment in favor of Staben on Palacios’s cross-complaint for indemnity.
A. Standard of Review
“The motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that
the moving party is entitled to a judgment as a matter of law.” (
We independently review the trial court’s decision to grant summary judgment, using the same three-step analysis as the trial court: (1) Identifying the issues framed by the pleadings; (2) determining whether the defendant negated the plaintiff’s claims; and (3) deciding whether the plaintiff demonstrated the existence of a triable, material factual issue.
(Silva v. Lucky Stores, Inc.
(1998)
B. The Cross-complaint and Motion for Summary Judgment
Palacios filed a cross-complaint against Staben asserting causes of action for indemnity, contribution and declaratory relief. Palacios alleged that if it were found liable to Stonegate or settled with Stonegate, it was entitled to indemnity or contribution from Staben by reason of Staben’s “negligence or other fault” in its work on the Stonegate project.
Following entry of judgment in favor of Staben on its nonsuit, Staben moved for summary judgment on Palacios’s cross-complaint. Staben asserted that its motion was “based on the fact that the evidence in the case has established that in performing its work at the Stonegate project, Staben fulfilled all of its obligations under its oral agreement with R&R Palacios, and therefore the predicate tort necessary for Palacios to maintain these causes of action is absent.” Specifically, Staben relied on the deposition testimony of Tom Staben that Ron Palacios told him the developer “wanted to use Thoroseal like they had used in Moorpark,” “to [his] knowledge” Thoroseal was used on each of
Palacios opposed the motion by presenting evidence that Staben did not apply the Thoroseal in compliance with the standard of care in the industry. Specifically, Palacios relied on the deposition testimony of its waterproofing expert, Warren Kelly Roberts, that Thoroseal was to be applied in a two-coat uniform manner; Staben did not apply the Thoroseal in a two-coat uniform manner; there were areas where the Thoroseal application was too thin or was missing altogether; and Staben either oversaturated the Thoroseal when preparing it or oversaturated the walls before application. Palacios also relied on the deposition testimony of its drainage expert, Mohammad Joolezadah, that improper waterproofing and the absence of waterproofing led to wall deterioration.
The trial court granted the motion for summary judgment, stating: “For equitable indemnity against the indemnitor there must be a basis for tort liability against the proposed indemnitor. [Staben] having performed under the oral contract to the satisfaction of [Palacios], there is no tort liability.”
C. There Were Triable Issues of Material Fact as to Whether Staben Was Negligent
“[T]he doctrine of comparative equitable indemnity is designed to do equity among defendants. Under the equitable indemnity doctrine, defendants are entitled to seek apportionment of loss between the wrongdoers in proportion to their relative culpability so there will be ‘equitable
sharing
of loss between multiple tortfeasors.’ ”
(Gem Developers v. Hallcraft Homes of San Diego, Inc.
(1989)
The trial court granted the motion for summary judgment based on its determination that there could be no basis for tort liability on Staben’s part because Palacios was satisfied with the work Staben had performed under the parties’ oral agreement. But Palacios’s satisfaction with Staben’s work does not absolve Staben of liability for the damage Stonegate may have suffered as a result of Staben’s work if it was negligently performed. As Palacios notes, the issue on Palacios’s cross-complaint for indemnity was an equitable sharing of responsibility for the loss that
Stonegate
suffered, for which Palacios is obligated to pay compensation as part of its settlement with Stonegate.
(Gem Developers v. Hallcraft Homes of San Diego, Inc., supra,
In moving for summary judgment, Staben produced no evidence regarding its duty of care or the quality of its work on the Stonegate project. In its separate statement of undisputed material facts, Staben merely asserted that it had performed its work on the Stonegate project “in the same manner” as it did at the prior Moorpark project. But the only “evidence” Staben cited to support this asserted fact was Tom Staben’s testimony that Ron Palacios told him the developer
But even if it had, Palacios’s evidence in opposition to the motion for summary judgment as to the correct way to apply Thoroseal and Staben’s failure to apply it in a manner necessary to prevent the passage of water through the retaining walls was sufficient to create a triable issue of material fact as to whether Staben’s work on the Stonegate project fell below the standard of care in the industry. We have already concluded that a subcontractor like Staben owes a duty of care to homeowners like Stonegate, and that evidence of Staben’s standard of care is relevant to the question of its liability for negligence. The trial court therefore erred in granting the motion for summary judgment on Palacios’s cross-complaint for indemnity.
HI. APPEAL OF THE COST AWARDS
Both Stonegate and Palacios filed notices of appeal from the postjudgment orders awarding costs to Staben as the prevailing party. In light of our decision reversing the judgment in favor of Staben following the nonsuit and reversing the summary judgment in favor of Staben on the cross-complaint for indemnity, Staben is no longer the prevailing party. We reverse the postjudgment cost orders.
(Peerless Lighting Corp. v. American Motorists Ins. Co.
(2000)
DISPOSITION
The judgment in favor of Staben following the nonsuit and the summary judgment in favor of Staben, as well as the postjudgment orders regarding costs, are reversed and the matter is remanded for retrial. Appellants Stonegate and Palacios are awarded costs on appeal.
Boren, P. J., and Ashmann-Gerst, J., concurred.
Notes
Staben argues that Palacios lacks standing to challenge the nonsuit. We disagree. “ ‘Any party aggrieved’ may appeal from an adverse judgment. (
Here, Palacios filed a motion for new trial, which was denied. Palacios therefore became a party of record. Palacios was also aggrieved by the judgment in favor of Staben because pursuant to Palacios’s sliding scale
Mary Carter
settlement agreement with Stonegate, any recovery by Stonegate against Staben would reduce the amount of Palacios’s liability to Stonegate “dollar for dollar.” The judgment in favor of Staben precluded Palacios from reducing its liability to Stonegate. But even if we were mistaken in finding that Palacios had standing to challenge the nonsuit on appeal, Stonegate has joined in Palacios’s brief on this issue, adopting it by reference. (