Supreme Court: General contractor assumed duty to sub-subcontractor through contract

A general contractor assumed a non-delegable duty of care to the employee of a sub-subcontractor through its contractual language, the Indiana Supreme Court decided Wednesday, reversing summary judgment to the general contractor on the issue of duty.

In June 2012, TCI Architects entered into an agreement to serve as general contractor on a Gander Mountain construction project in Lafayette. TCI hired several subcontractors to work on the job, including Craft Mechanical, which then entered into a sub-subcontract with B.A. Romines Sheet Metal to perform heating and ventilation work.

In the Craft-Romines contract, Romines had the responsibility to implement safety precautions and comply with applicable law. Similarly, TCI placed the onus on ensuring employee safety on Craft in its subcontract.

One day while Romines employee Michael Ryan was working on the project, he fell from an 8-foot ladder and sustained serious injuries. After the accident, Ryan sued, naming TCI and Craft as defendants and claiming that the two companies had breached their duty to provide him with a safe workplace.

Ryan then moved for partial summary judgment on the issue of duty, arguing both defendants had a non-delegable contractual obligation to provide a safe work environment. TCI filed a cross-motion for summary judgment on duty, breach and proximate cause, and the Marion Superior Court denied Ryan’s motion and granted TCI’s.

A divided Indiana Court of Appeals affirmed, finding the contract between TCI and Gander Mountain did not create a duty. The Indiana Supreme Court heard arguments on petition to transfer in December, and granted transfer and reversed the trial court’s decision in a unanimous Wednesday opinion.

Justice Steve David, writing for the court, first noted “a general contractor, such as TCI, will ordinarily owe no outright duty of care to a subcontractor’s employees, much less so to employees of a sub-subcontractor.” However, a duty of care can exist between a contractor and subcontractor “where a contractual obligation imposes a ‘specific duty’ on the general contractor,” David said.

The TCI – Gander Mountain contract provides that TCI will “assume responsibility for implementing and monitoring all safety precautions and programs related to the performance of the Work.” Additionally, the contract calls for TCI to “designate a Safety Representative with the necessary qualifications and experience to supervise the implementation and monitoring of all safety precautions and programs related to the Work.”

“By assuming responsibility for implementing and monitoring all safety precautions and programs related to work performance, TCI expressly shouldered the duty of carrying out and periodically supervising the very safety policies that may have prevented worker injury here,” David wrote. “Assumption of responsibility also means that TCI assumed the risk of liability for damages that might have been incurred if any of those safety precautions and programs were to ever fall short of the reasonable standard of care.”

David noted that the court’s decision was based on its contract interpretation precedent, not Court of Appeals precedent, which both parties urged the court to look to in making its decision. Additionally, looking to the “four corners rule,” the justice wrote that subsequent contracts TCI entered into do not have any effect on its assumption of the duty of care.

The high court granted Ryan’s motion for partial summary judgment on the issue of duty, and remanded for further proceedings on breach, causation and damages. The case is Michael Ryan v. TCI Architects/Engineers/Contractors, Inc. and BMH Enterprises, Inc. d/b/a Craft Mechanical, 49S02-1704-CT-253.

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