Division 2: Jury to Decide Whether Owner Waived Contract's Suit Limitation Period
In this latest installation in the Mike Johnson saga, Division 2 held this week that the City of Olympia must go to trial on a contractor's $768,000 impact claim arising out of a sewer line project.
The case was before Division 2 on the contractor's appeal from a grant of summary judgment in favor of the City. The contract was governed by the WSDOT Standard Specifications, which in Section 1-09.11(3) provide that any suit must be filed within 180 days of final acceptance. Because the suit was not brought within that time, the City moved for summary judgment and prevailed.
On appeal, Division 2 concluded that a triable issue of fact existed on whether the City had waived enforcement of the 180 day suit limitation when it engaged in claim negotiations with the contractor after expiration of the applicable suit period. The Court distinguished Mike Johnson as a case where the owner (who also engaged in claim negotiations) had "continuously asserted" that it did not intend any waiver of defense during the negotiations.
Property Policy Won't Cover Evacuation Expenses Without Actual "Physical Loss" to Structure
On the advice of a structural engineer -- who believed an occupied building was about to collapse -- the bank occupant evacuated the building at considerable disruption and expense. Turns out the engineer was wrong. After settling its malpractice claim against the engineer, the bank sought coverage under its property policies for economic losses incurred in the evacuation.
Division 1 said there was no coverage. Not only did the bank fail to show the existence of any ""direct physical loss" in fact, the bank's preventive evacuation was not compensable under the "Sue and Labor" clause because no collapse in fact occurred even though the bank had a reasonable belief that collapse was imminent.
Misrepresentation Claim Barred by Economic Loss Doctrine
The economic loss doctrine (in a nutshell) means you can't sue in tort for purely economic loss (in contrast to personal injury or property damage). Here, Division 2 dismisses an owner's claim that a builder negligently misrepresented the quality of synthetic stucco applied to a home, holding the owner's remedies are limited to the contract under the economic loss doctrine. Division 2 distinguished contrary Division 3 authority on this same issue.
Paper: "Brewery owner has criminal past"
The old Miller beer plant in Tumwater (a/k/a the Olympia beer plant in Tumwater) has been under new ownership. That new ownerhip has been looking to launch a bottled water factory at the site. Comes now the fairly explosive news, according to the Olympian, that the new owner is not what he appeared to be. The headline summarizes its investigation: "Brewery owner has criminal past." At least one general contractor and several engineering firms are owed substantial sums of money for work performed to date, according to documents available at the newspaper's website.
Association Not "Real Party in Interest" for Suit Alleging Defects in Individual Units
An association of townhome owners lacks authority to bring suit against a developer to recover for alleged defects contained within the individual homes (as opposed to the common elements). So sayeth the Oregon Court of Appeals in this new case.
No Right of Jury Trial for Promissory Estoppel Claim
In a case of first impression, Division 1 yesterday held there is no right to a jury trial under the Washington Constitution for a claim based on the theory of promissory estoppel. This theory is commonly invoked by general contractors under the Arango case in damage claims against subcontractors who fail to honor bids which the GC has relied on in binding itself to the owner in its prime bid. The Court appears to have left unchanged a 1998 decision holding that claims for unjust enrichment are legal in nature and therefore do give rise to a right of trial by jury.
Supreme Court Clarifies "Repeat Violation" Standard under WISHA
By a 5-4 vote with three separate dissents, the Supreme Court last week upheld a WISHA repeat violation penalty against a roofing contractor in a case that attracted significant industry amicus activity. The gist of the issue was whether a repeat violation could be based on the more lenient test of demonstrating that the prior violation related to the same general type of harm (i.e., fall protection) or the more stringent test of demonstrating the prior violation was based on the same underlying conduct. The majority opted for the more lenient test, citing the language of the statute and WISHA's remedial purpose.