Justia Oklahoma Supreme Court Opinion SummariesArticles Posted in Construction Law
H2K Technologies v. WSP, USA
At issue in this case was an action to foreclose a materialman's lien filed on property located in Garvin County, Oklahoma. Wynnewood Refining Co., LLC owned an oil refinery and entered into an Environmental Services Agreement with the original contractor, now WSP USA, Inc. to provide labor and materials to improve the Property. Thereafter, WSP entered into a subcontract with Techsas, Inc. to provide labor and materials to improve the property. The Techsas Contract contained a waiver clause whereby Techsas waived all liens and claims, statutory or otherwise, resulting from the labor done and materials furnished on the project. The waiver clause also required Techsas to insert a similar waiver clause into any subcontracts it engaged in. The parties agreed that sometime in 2019, Techsas entered into a subcontract (H2K Contract) with plaintiff-appellant H2K Technologies, Inc., (H2K or materialman) to provide materials and labor to improve the property. When Techsas failed to pay H2K, the H2K served a preliminary lien notice on Wynnewood, Techsas and WSP for the estimated price of the provided labor, services, equipment and materials. H2K thereafter filed a lien statement to the Garvin County Clerk. Months later, H2K filed its petition to foreclose the lien. Both plaintiff and defendants filed competing motions for summary judgment; the trial court ruled in favor of defendants' motion and denied plaintiff's, ruling: (1) although the Techsas Contract was governed by New York law, which prohibited waiver clauses, contract provisions that subject a construction contract to the laws of another state were against public policy in Oklahoma pursuant to 15 O.S. 2011, 821(B)(1); and (2) H2K was charged with constructive notice of the subcontract between Techsas and WSP and because Techsas had waived its rights to all liens and claims, H2K did not have a legal right to impress a lien on the Property. H2K appealed. The Oklahoma Supreme Court held that under the limited issues of law presented on appeal, H2K was not bound by the waiver of lien clause in the Techsas Contract. The Court also held that the provisions of 15 O.S. 2011, section 821(B)(2) were not applicable to mechanics' and materialmen's liens. The Court therefore reversed the trial court's order granting summary judgment and remanded for further proceedings. View "H2K Technologies v. WSP, USA" on Justia Law
Loven v. Church Mutual Ins. Co.
In a matter of first impression, the Oklahoma Supreme Court addressed whether a claim of intentional interference with a prospective economic business advantage required a showing of bad faith, and whether the immunity protections provided by 36 O.S. Supp. 2012 section 363 were forfeited under the alleged facts. Plaintiff-appellant Lisa Loven, a general contractor who applied for a public adjuster license with the Oklahoma Department of Insurance (the Department), disclosed that a former client sued her for acting as an unlicensed adjuster. The Department opened an investigation and subsequently denied her application. Loven appealed. During the appeal hearing Church Mutual Insurance and its adjuster Jeffrey Hanes provided information regarding their dealings with Loven as a general contractor when she contracted for storm repair work for two churches they insured. The appellate hearing officer affirmed the denial of her application as a public adjuster because she had illegally acted as an unlicensed public adjuster. Loven sued Church Mutual and Hanes for intentional interference with a prospective economic business advantage. The trial court granted summary judgment to Church Mutual and Hanes because 36 O.S. Supp. 2012 section 363 provided civil tort immunity to insurers who provide any information of fraudulent conduct to the Department. The Court of Civil Appeals affirmed. The Supreme Court held: (1) 36 O.S. Supp. 2012 section 363 provided immunity for those who report or provide information regarding suspected insurance fraud as long as they, themselves, do not act fraudulently, in bad faith, in reckless disregard for the truth, or with actual malice in providing the information; and (2) the alleged tort of intentional interference with a prospective economic business advantage required a showing of bad faith. Because no proffered evidence in this case showed bad faith, the immunity provisions of 36 O.S. Supp. 2012 section 363 applied, and summary judgment was proper. View "Loven v. Church Mutual Ins. Co." on Justia Law
Williams v. TAMKO Building Products, Inc.
Defendant-appellee TAMKO Building Products, Inc. was a roof shingle manufacturer incorporated in Missouri. Plaintiffs-appellants were homeowners whose contractors installed Defendant's shingles on homeowner's roof. Plaintiffs filed suit alleging they were entitled to compensation for damage to their home caused by Defendant's faulty shingles and the expense of installing a new roof. Defendants moved to stay proceedings and compel arbitration pursuant to an arbitration agreement on the shingle's packaging. The trial court granted the Defendant's Motion to Stay Proceedings and Compel Arbitration concluding the Plaintiffs were charged with the knowledge of the contract even if they did not read it, that TAMKO did not waive its right to compel arbitration, and that the contract was not unconscionable. Plaintiffs appealed. The Oklahoma Supreme Court reversed, finding that the arbitration clause at issue in this case was printed on the shingles' wrapping, which was seen only by the contractors installing them. The wrapping was discarded once the shingles were unpackaged and placed on rooftops. The Supreme Court concluded the Homeowners were not bound by the arbitration agreement: "n implied agent whose sole authority is to select and install shingles does not have the authority to waive the principal's constitutional rights. Further, the intentional printing of an agreement to waive a constitutional right on material that is destined for garbage and not the consumer's eyes is unconscionable. The Homeowners never had an opportunity to make a knowing waiver of access to the courts." View "Williams v. TAMKO Building Products, Inc." on Justia Law
Tiger v. Verdigris Valley Electric Cooperative
In 2008, a field engineer for Verdigris Valley Electric Cooperative (Employer) met with a contract electrician for Integrated Service Company LLC (INSERV) in Catoosa, concerning the installation of additional underground electrical service. They discussed the location of the additional service to the building and decided to use an existing junction box which the engineer observed was surrounded by a yellow metal barricade. He would later note: "I normally recommend that our members [customers] install a protective post an [sic] each corner of a pad mounted device in high traffic areas such as the INSERV plant, to help protect from getting ran [sic] over by vehicles or other equipment. I would never suggest having a barrier of any kind in front of any opening or door on VVEC equipment." Employer's work crew, consisting of Employer was dispatched to install additional underground electrical service to INSERV. The four-man crew consisted of Jones, Jackson, Day, and Tiger. Jones and Jackson were journeymen electricians and Jones was the foreman. Day and Jason Tiger were apprentices. Tiger had been in the journeyman apprentice program for approximately nine months of a four-year program. At the time of his death, Tiger had been certified only in the climbing school portion of his journeyman training. Day had worked for Employer only one month. When the crew arrived at the work site, they found the junction box surrounded by a yellow painted steel barricade, erected presumably to protect it from being struck by vehicles or trailers. The record did not establish who erected or owned the barricade, but Employer owned the junction box and associated electrical equipment. Affixed to the junction box was a warning concerning hazardous voltage and underground power cables and a notice from Employer. Despite this, Tiger was electrocuted attempting to make a connection to the junction box. His widow sued Employer and INSERV pursuant to "Parret v. UNICCO Service Co.," (127 P.3d 572), asserting that Employer knew that injury or death was substantially certain to result from the task Tiger and his coworkers were directed to complete and the conditions in which they were required to work. The District Court denied the employer's motion for summary judgment but granted a second motion for summary judgment after additional discovery. The Court of Civil Appeals affirmed. The Supreme Court reversed after its review of the trial court record, finding material issues of fact remained in dispute. View "Tiger v. Verdigris Valley Electric Cooperative" on Justia Law
Pizano v. Lacey & Assoc., LLC
In 2012, Lacey & Associates, LLC, contracted with Everest Homes, LLC, to purchase a commercial building. In addition, Lacey and Everest executed an escrow agreement for the release of additional funds to Everest if the roof was replaced after title had transferred to Lacey. After title passed to Lacey, Everest entered into a contract with the Williams Group, a contractor, to replace the roof. The Williams Group then hired Andrea Pizano to remove the old roof and HVAC units, which service she performed. In early 2013, Pizano sued alleging the Williams Group did not pay the contractual amount of $11,085, as agreed by the two parties. She filed a mechanic's lien on Lacey's building one day before she filed her petition. The lawsuit sought judgment against the Williams Group in the amount of $11,085, plus interest. The Williams Group never filed an answer. The trial court thereafter entered a default judgment against the Williams Group, awarding Pizano $11,085, an attorney's fee of $2,500.00 and court costs of $461.81. Pizano then sought to foreclose her lien against Lacey and be awarded court costs and attorney fees. She requested that the property be sold to satisfy the judgment. Lacey answered and included a "Cross-motion for Summary Judgment," contending that the new roof leaked so badly that large barrels had to be placed inside the building to catch the water. Therefore, no party was entitled to be paid for the roof. Lacey also asserted that Pizano's motion should be denied because Lacey had no contract with Pizano, and also that the plaintiff failed to file the required pre-lien notice. The trial court granted Pizano's summary judgment motion in part, and denied Lacey's counter-motion for summary judgment. Lacey appealed and Pizano counter-appealed. The Court of Civil Appeals held that Pizano successfully preserved her subcontractor's lien, but found that genuine disputes of fact remained as to the amount owed to Pizano and the enforceability of the lien. The Supreme Court found that the Legislature intended amounts less than $10,000 to be exempt from pre-lien notice. Having provided such an exception, the wording of the applicable statute persuaded the Court that "if a claimant filed a claim of $10,085 without a pre-claim notice, the claim would be enforceable up to $9,999. We do not believe that the claim would be completely unenforceable if it exceeded that legislatively-approved amount by a mere $86." The trial court's order entitling Pizano to a reduced judgment amount of $9,999.00 and an award of attorneys' fees and costs was affirmed. This case was remanded to the trial court to issue a judgment consistent with the law as expressed in the Supreme Court's opinion. View "Pizano v. Lacey & Assoc., LLC" on Justia Law
Walker v. BuildDirect.com Technologies, Inc.
The Tenth Circuit Court of Appeals certified a question of Oklahoma law to the Oklahoma Supreme Court. In April 2008, plaintiffs Shannon and Eric Walker requested several samples of hardwood flooring from BuildDirect.com Technologies, Inc., a Canadian corporation, through BuildDirect's website. The next month they arranged, over the telephone, to purchase 113 boxes of flooring from BuildDirect. BuildDirect emailed a two-page written Contract entitled "Quotation" to Ms. Walker, who signed and dated the Contract and returned it to BuildDirect via fax. The Contract described the type, amount, and price of the flooring purchased by the Walkers. And, it included 14 bullet points setting forth additional terms. The sixth bullet point stated: "All orders are subject to BuildDirect's 'Terms of Sale.'" The Walkers alleged that after they installed the flooring, they discovered that their home was infested with nonindigenous wood-boring insects. According to the Walkers, the insects severely damaged the home, and caused the home to be subject to quarantine and possible destruction by the United States Department of Agriculture. The question the federal appeals court posed to the Oklahoma Supreme Court was whether a written consumer contract for the sale of goods incorporated by reference a separate document entitled "Terms of Sale" available on the seller's website, when the contract stated that it was "subject to" the seller's "Terms of Sale" but did not specifically reference the website. In response, the Oklahoma Court held that Oklahoma law did not recognize a "vague attempt at incorporation by reference" as demonstrated in this case. Under the Oklahoma law of contracts, parties may incorporate by reference separate writings, or portions thereof, together into one agreement where: (1) the underlying contract makes clear reference to the extrinsic document; (2) the identity and location of the extrinsic document may be ascertained beyond doubt; and (3) the parties to the agreement had knowledge of and assented to its incorporation. View "Walker v. BuildDirect.com Technologies, Inc." on Justia Law
Broom v. Wilson Paving & Excavating
Wilson Paving & Excavating, Inc. was one of several subcontractors retained to perform services in connection with a renovation project at Sand Springs Memorial Stadium at Charles Page High School. Specifically, Wilson Paving contracted to dig trenches and lay pipe for a storm drainage system being installed under the athletic field. Wilson Paving utilized a local staffing agency, Labor Ready, to secure temporary workers to assist on the project. Steven Broom went to the offices of Labor Ready to obtain employment. Broom was directed by Labor Ready to work with Wilson Paving at Sand Springs High School. He reported to the high school and, at the instruction of Wilson Paving, began work laying pipe. The trench in which Broom was working collapsed twice - the first time covering him in dirt to his waist and the second time covering him in dirt to his neck. People on the job site freed Broom from the neck to the waist while waiting on emergency personnel to arrive. Once on the scene, emergency personnel could not enter the trench to rescue Broom until the trench was safely reinforced. During this time, Broom remained buried from the waist down. Emergency personnel eventually removed Broom from the trench, and he was transported to the hospital where he was treated for serious injuries, including rib fractures, collapsed lungs, pulmonary contusions, blood within the chest, fluid around the spleen and kidney, and a left kidney laceration. Before the trench collapsed, one of Wilson Paving's employees, Jack Bailey, was using a backhoe to dig the trench and to retrieve pipe from an area adjacent to the trench. Wilson Paving believed the trench collapse was due to the work of another contractor who had allegedly removed a monument and flag pole near the area of the collapse but failed to alert Bailey of such before he began digging the trench. Broom pursued and received workers' compensation benefits from Labor Ready for the injuries he sustained in the accident. Broom also sued Wilson Paving for his injuries in a third-party action to collect for his injuries as a result of Wilson's employee. The trial court found in favor of Broom and entered judgment against Wilson Paving for $1,150,000.00. Broom then sought post-judgment garnishment of Wilson Paving's Commercial General Liability Policy issued by Mid-Continent Casualty Company. The trial court entered summary judgment in favor of Mid-Continent, finding that coverage for Broom's injuries was precluded under the "earth movement" exclusion clause in Mid-Continent's policy. The Court of Civil Appeals found that the earth movement exclusion clause did not prevent coverage for Broom's injuries, but affirmed summary judgment on different grounds. Upon review, the Supreme Court held that Mid-Continent's Commercial General Liability Policy provided coverage for Broom's injuries. View "Broom v. Wilson Paving & Excavating" on Justia Law