Articles Posted in Construction Law

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The Minnesota Department of Transportation (MnDOT) contracted with Mathy Construction Company for a public highway project. Mathy subcontracted with Storms, Inc. for excavation and fill work. After Storms completed its work, MnDOT issued a deductive change order reducing Mathy’s contract amount by $327,064 because of errors in the estimated quantities of excavation and fill required for Storms’ work. Mathy reduced Storms’ subcontract by the same amount. Storms subsequently sued Mathy for the reduction in the subcontract price. The district court granted summary judgment in favor of Storms, concluding that Mathy had breached the subcontract. The court of appeals affirmed. The Supreme Court reversed, holding that Mathy did not breach its subcontract with Storms by issuing a corresponding deductive change order to Storms. View "Storms, Inc. v. Mathy Constr. Co." on Justia Law

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Meagher & Geer, PLLP (MG) represented Ryan Contracting Company (Ryan) in an action to foreclose on several mechanic’s liens. Later, represented by O’Neill & Murphy, LLP (O’Neill), Ryan brought suit against MG for legal malpractice arising out of MG’s allegedly defective filing and foreclosure of Ryan’s mechanic’s liens. The district court granted MG’s motion to dismiss on the ground that O’Neill failed to timely file expert witness affidavits. Ryan then brought suit against O’Neill for legal malpractice arising out of O’Neill’s representation of Ryan in the MG lawsuit. The district court granted summary judgment for O’Neill, concluding that the mechanic’s liens were not perfected, not because of MG’s conduct, but because of Ryan’s error in not filing the pre-lien notice to the property owner required by Minn. Stat. 514.011. The court of appeals reversed in part, concluding that Ryan was exempt from the pre-lien notice requirement under section 514.011, and there were genuine issues of fact regarding the other issues. The Supreme Court affirmed as modified, holding that the court of appeals did not err in concluding that Ryan was not required to give pre-lien notice to enforce its mechanic’s liens. View "Ryan Contracting Co. v. O’Neill & Murphy, LLP" on Justia Law

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At issue in this case was whether truck drivers hauling asphalt cement from a commercial oil refinery to a contractor’s facility are performing “work under a contract” under Minn. Stat. 177.44(1) and, therefore, must be paid prevailing wages. The Minnesota Department of Transportation (MDOT) determined that the construction companies that were awarded contracts to work on state highway projects violated the project contracts by failing to ensure that drivers that assisted in the acquisition and transport of asphalt cement for the projects were paid prevailing wages. Appellants argued that the hauling activities of these drivers did not constitute “work under a contract” under Minn. Stat. 177.44(1) and, alternatively, that the hauling activities were exempt from the prevailing wage requirements under the “commercial establishment exception” in the Prevailing Wage Act. The district courts granted summary judgment to MDOT. The court of appeals affirmed. The Supreme Court reversed, holding that hauling activities must be to, from, or on the site of a public works project to qualify as “work under a contract,” and therefore, the hauling activities in this case did not constitute “work under the contract” subject to the prevailing wage requirements. View "J.D. Donovan, Inc. v. Minn. Dep’t of Transp." on Justia Law

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Appellant used Respondent as the general contractor for the construction of a building. When the building began having problems with water intrusion, Appellant brought suit claiming that Respondent acted negligently in its duties as general contractor. The district court granted summary judgment in favor of Respondent, concluding that the action was untimely under the two-year statute of limitations for improvements to real property in Minn. Stat. 541.051(1)(a). The court of appeals affirmed. The Supreme Court affirmed in part and reversed in part, holding (1) the court of appeals correctly found that the plain language of section 541.051(1) does not require that construction be substantially complete to start the running of the statute of limitations; but (2) there remained a genuine issue of material fact as to when Appellant discovered its injury, and therefore, the district court erred in granting summary judgment. Remanded. View "328 Barry Avenue v. Nolan Props. Group, LLC" on Justia Law

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The Minnesota Laborers Health and Welfare Fund (“the Funds”) filed a declaratory judgment action against Granite Re, Inc. seeking clarification of their right to payment on a surety bond. The district court granted summary judgment to Granite Re, concluding, among other things, that the Funds’ lawsuit was time-barred because the Funds failed to commence litigation within the one-year contractual limitations period set out in the bond. The court of appeals reversed and remanded, concluding that fraudulent concealment by the bond principal tolled the limitations period set out in the bond. The Supreme Court affirmed, holding (1) fraudulent concealment can be applied to a surety that was not involved in the fraudulent concealment by the principal; and (2) therefore, the one-year contractual limitations period set out in the bond may be tolled against Granite Re. View "Minn. Laborers Health & Welfare Fund v. Granite Re, Inc." on Justia Law

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Mark Hilde hired Big Lake Lumber (Big Lake), Wruck Excavating (Wruck), and J. DesMarais Construction (DesMarais) to help him build a "spec home." 21st Century Bank (Bank) recorded a mortgage against the property to finance the purchase of the property and the home construction. After the Bank foreclosed on its mortgage, Big Lake commenced this mechanic's lien foreclosure action. The district court found that the mechanic's liens of Big Lake and DesMarais related back to the date Wruck commenced work on the improvement project, and thus, the mechanic's liens of Big Lake and DesMarais had priority over the mortgage of the Bank. The court of appeals reversed. The Supreme Court reversed, holding (1) the court of appeals erred by adopting and then applying a new "integrated analysis" to find the Bank's mortgage superior to the liens; and (2) the district court did not clearly err when it found that Wruck, Big Lake, and DesMarais contributed to the same project of improvement, and accordingly, under the relation-back doctrine, the mechanic's liens of Big Lake and DesMarais had priority over the Bank's mortgage.View "Big Lake Lumber, Inc. v. Sec. Prop. Invs., Inc." on Justia Law

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A subcontractor on a public project filed suit against the general contractor and an insurance company that provided a payment bond seeking to recover money owed under the subcontract after the general contractor defaulted. The subcontractor asserted a payment-bond claim against the insurance company and breach of contract, unjust enrichment, and other claims against the general contractor. The insurance company filed a motion for summary judgment on the payment-bond claim because the subcontractor mailed its pre-suit notice of claim to the general contractor listed on the subcontract rather than the address listed on the payment bond. The district court denied the motion and granted judgment against the insurance company. The court of appeals reversed. The Supreme Court affirmed, holding (1) pursuant to Minn. Stat. 574.31(2)(a), a claimant must serve notice on the contractor at its address as stated in the bond as a prerequisite to filing suit; and (2) the subcontractor in this case did not comply with the statutory notice requirements. View "Safety Signs, LLC v. Niles-Wiese Constr. Co., Inc." on Justia Law

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Johnson Controls, Inc. contracted with a school district (the District) to provide design services. Johnson then subcontracted with Architectural Resources, Inc. Marshall Helmberger subsequently submitted a request to Johnson under the Data Practices Act for a copy of the subcontract. Johnson denied the request and withheld the contract. Thereafter, Helmberger filed a complaint with the Office of Administrative Hearings (OAH). An administrative law judge (ALJ) dismissed the complaint after a hearing, concluding that Helmberger did not establish that Johnson was performing a governmental function for the District within the meaning of Minn. Stat. 13.05(11)(a). The court of appeals reversed. The Supreme Court reversed, holding that Johnson was not obligated to disclose the subcontract under the Act because the subcontract was not public data under section 13.05(11)(a). View "Helmberger v. Johnson Controls, Inc." on Justia Law

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After a jury trial, Appellant was convicted of aiding and abetting the first-degree murder of his brother as well as obstructing an investigation. Appellant was sentenced to life in prison without the possibility for parole. Appellant subsequently filed a petition for postconviction relief, which the postconviction court denied. The Supreme Court affirmed, holding (1) Appellant's ineffective-assistance-of-counsel claim failed because Appellant failed to show that, but for his attorneys' alleged errors, there was a reasonable probability the outcome of his trial would have been different; and (2) any error in the admission of statements made by Appellant's sister and girlfriend was harmless beyond a reasonable doubt. View "Hawes v. State" on Justia Law

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L.H. Bolduc Company, Inc. (Bolduc) was the subcontractor of Engineering and Construction Innovations, Inc. (ECI). Bolduc damaged a sewer pipe while working on a construction project. ECI repaired the damage and sought reimbursement from Bolduc's insurer, The Travelers Indemnity Company of Connecticut (Travelers) under an endorsement to Bolduc's policy naming ECI as an additional insured for liability caused by acts or omissions of Bolduc. Travelers denied coverage. ECI subsequently sued Bolduc and Travelers (collectively, Appellants) for negligence and breach of contract. A jury found that Bolduc was not negligent, and the district court granted summary judgment for Appellants on ECI's breach of contract claims, concluding that Appellants had no obligation to reimburse ECI for damages not caused by Bolduc. The court of appeals reversed, determining (1) ECI was entitled to coverage as an additional insured without regard to Bolduc's fault; and (2) Bolduc was required to indemnity ECI. The Supreme Court reversed, holding (1) ECI did not qualify as an additional insured with respect to the pipe damage; and (2) Bolduc could not be required to indemnify ECI without violating Minn. Stat. 337.02, which prohibits indemnification for the fault of others in construction contracts. View "Eng'g & Constr. Innovations, Inc. v. L.H. Bolduc Co., Inc." on Justia Law