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Importance of contracts in construction

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A carefully crafted contract resulted in the Indiana Supreme Court finding a construction company had no duty of care to a subcontractor’s injured employee.

In Hunt Construction Group, Inc. and Mezzetta Construction, Inc., v. Shannon D. Garrett, No. 49S02-1106-CT-365, the justices reversed a Court of Appeals decision that found Hunt Construction Group – the project manager for the construction of Lucas Oil Stadium in Indianapolis – owed a duty of care to a subcontractor’s employee who was injured on the job.

lucasoil-15col.jpg Construction of Lucas Oil Stadium began in 2005 and ended in 2008. (File photo)

Shannon Garrett, an employee of Baker Concrete, was on the jobsite in 2006 when another Baker Concrete employee was removing a piece of forming material above her, and the material fell, injuring Garrett’s head and left hand.

Hunt had no contract with Baker Concrete, but it had a contract with the Stadium Authority to oversee daily operations. Sean Devenney, an attorney who practices construction law with Drewry Simmons Vornehm, said Hunt went beyond what it was contractually obligated to do, taking steps to train workers about safety. Devenney said that the Supreme Court’s decision is important, because if Hunt had to defend itself at trial, construction companies might not see the value in providing additional safety training.

“It is going to be the defining case for quite some time about how to attempt to craft safety programs for clients without taking on liability that they really don’t have very much control over,” he said.

Precedent

The justices cited Nathan Stumpf and Sarisa Stumpf v. Hagerman Construction Corp. and D.A. Dodd Inc., 863 N.E.2d 871, 878 (Ind. Ct. App. 2007) – a case often relied upon in determining the duty of care in construction accident lawsuits. In that case, the Court of Appeals turned to the language of Hagerman’s contract to determine the company had owed a duty of care to a subcontractor.

The COA found in Stumpf that Hagerman’s contract with Purdue University showed that Purdue intended for Hagerman to be responsible for safety on the job site. Devenney said that while both Stumpf and Hunt concern the liability of a construction manager, the cases are distinguished by the language of contracts.

devenney-sean-mug Devenney

“In Hunt, they were very specific and they had many instances where they were clear that they were not taking on the role of safety for the contractors who were doing work,” he said.

Jeffrey Hammond, of Cohen & Malad, had argued on behalf of Garrett in the COA appeal. He said that he thinks Hunt will be limited in its applications going forward, as the type of complex agreement between parties in the case occurs primarily on large public projects.

“The reality is, you don’t see these agreements. In all the cases that I’ve dealt with, construction manager agreements don’t come up that often,” he said.

Hammond said that in large projects, the owner attempts to add layers of safeguards. He equated the construction manager’s role to that of an editor who proofreads a writer’s work.

jeff hammond Hammond

“The Stadium Authority should be commended for its commitment to worker safety and for paying a lot of money to Hunt to enforce project safety rules, and I encourage other project owners around the state to place high value on worksite safety,” he added.

Hammond said that as project owners put increasing emphasis on overall safety, they may be looking at construction management companies more carefully.

“Companies or contractors who put profits over safety and seek ways to avoid accountability for their worksite safety obligations are probably not going to get the job,” he said.

Opinions divided

The Supreme Court’s opinion in Hunt was not unanimous. Justice Brent Dickson’s perception was that the duty of care Hunt owed to Garrett was a “mixed question of fact and law.”

Devenney interprets that to mean Dickson would prefer to see the matter go before a jury.

“I think what he would be saying is that he’s looking at the contract and the activities Hunt took on with this project … probably what he’s saying is he trusts the jury to decide whether Hunt should be held accountable,” Devenney said.

mark voigtmann Voigtmann

When the Court of Appeals issued its opinion in this case, that decision wasn’t unanimous, either. Judge Ezra Friedlander agreed with the COA majority that Hunt did not assign a non-delegable duty to Garrett to assume vicarious liability, but he disagreed that Hunt owed a duty to Garrett based on conduct.

Safety in the industry

Mark Voigtmann leads the construction section of Faegre Baker Daniels’ real estate and construction group. He said safety is an ever-present concern in the construction industry.

“I think this decision is very helpful and despite appearances, is actually a pro-safety opinion, because it clarified that a construction company such as Hunt here can be involved in a very direct way in providing for the safety of all construction workers at a particular site while still being able to not bite off complete responsibility for that safety,” he said. “Reasonable minds can differ on this thing – I’m just a disinterested outside party looking in.”•

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  1. From back in the day before secularism got a stranglehold on Hoosier jurists comes this great excerpt via Indiana federal court judge Allan Sharp, dedicated to those many Indiana government attorneys (with whom I have dealt) who count the law as a mere tool, an optional tool that is not to be used when political correctness compels a more acceptable result than merely following the path that the law directs: ALLEN SHARP, District Judge. I. In a scene following a visit by Henry VIII to the home of Sir Thomas More, playwriter Robert Bolt puts the following words into the mouths of his characters: Margaret: Father, that man's bad. MORE: There is no law against that. ROPER: There is! God's law! MORE: Then God can arrest him. ROPER: Sophistication upon sophistication! MORE: No, sheer simplicity. The law, Roper, the law. I know what's legal not what's right. And I'll stick to what's legal. ROPER: Then you set man's law above God's! MORE: No, far below; but let me draw your attention to a fact I'm not God. The currents and eddies of right and wrong, which you find such plain sailing, I can't navigate. I'm no voyager. But in the thickets of law, oh, there I'm a forester. I doubt if there's a man alive who could follow me there, thank God... ALICE: (Exasperated, pointing after Rich) While you talk, he's gone! MORE: And go he should, if he was the Devil himself, until he broke the law! ROPER: So now you'd give the Devil benefit of law! MORE: Yes. What would you do? Cut a great road through the law to get after the Devil? ROPER: I'd cut down every law in England to do that! MORE: (Roused and excited) Oh? (Advances on Roper) And when the last law was down, and the Devil turned round on you where would you hide, Roper, the laws being flat? (He leaves *1257 him) This country's planted thick with laws from coast to coast man's laws, not God's and if you cut them down and you're just the man to do it d'you really think you would stand upright in the winds that would blow then? (Quietly) Yes, I'd give the Devil benefit of law, for my own safety's sake. ROPER: I have long suspected this; this is the golden calf; the law's your god. MORE: (Wearily) Oh, Roper, you're a fool, God's my god... (Rather bitterly) But I find him rather too (Very bitterly) subtle... I don't know where he is nor what he wants. ROPER: My God wants service, to the end and unremitting; nothing else! MORE: (Dryly) Are you sure that's God! He sounds like Moloch. But indeed it may be God And whoever hunts for me, Roper, God or Devil, will find me hiding in the thickets of the law! And I'll hide my daughter with me! Not hoist her up the mainmast of your seagoing principles! They put about too nimbly! (Exit More. They all look after him). Pgs. 65-67, A MAN FOR ALL SEASONS A Play in Two Acts, Robert Bolt, Random House, New York, 1960. Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, for defendants. Childs v. Duckworth, 509 F. Supp. 1254, 1256 (N.D. Ind. 1981) aff'd, 705 F.2d 915 (7th Cir. 1983)

  2. "Meanwhile small- and mid-size firms are getting squeezed and likely will not survive unless they become a boutique firm." I've been a business attorney in small, and now mid-size firm for over 30 years, and for over 30 years legal consultants have been preaching this exact same mantra of impending doom for small and mid-sized firms -- verbatim. This claim apparently helps them gin up merger opportunities from smaller firms who become convinced that they need to become larger overnight. The claim that large corporations are interested in cost-saving and efficiency has likewise been preached for decades, and is likewise bunk. If large corporations had any real interest in saving money they wouldn't use large law firms whose rates are substantially higher than those of high-quality mid-sized firms.

  3. The family is the foundation of all human government. That is the Grand Design. Modern governments throw off this Design and make bureaucratic war against the family, as does Hollywood and cultural elitists such as third wave feminists. Since WWII we have been on a ship of fools that way, with both the elite and government and their social engineering hacks relentlessly attacking the very foundation of social order. And their success? See it in the streets of Fergusson, on the food stamp doles (mostly broken families)and in the above article. Reject the Grand Design for true social function, enter the Glorious State to manage social dysfunction. Our Brave New World will be a prison camp, and we will welcome it as the only way to manage given the anarchy without it.

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  5. Some in the Hoosier legal elite consider this prayer recommended by the AG seditious, not to mention the Saint who pledged loyalty to God over King and went to the axe for so doing: "Thomas More, counselor of law and statesman of integrity, merry martyr and most human of saints: Pray that, for the glory of God and in the pursuit of His justice, I may be trustworthy with confidences, keen in study, accurate in analysis, correct in conclusion, able in argument, loyal to clients, honest with all, courteous to adversaries, ever attentive to conscience. Sit with me at my desk and listen with me to my clients' tales. Read with me in my library and stand always beside me so that today I shall not, to win a point, lose my soul. Pray that my family may find in me what yours found in you: friendship and courage, cheerfulness and charity, diligence in duties, counsel in adversity, patience in pain—their good servant, and God's first. Amen."

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