Atkinson et al v. Jeff Lindsey Communities, Inc.
MEMORANDUM OPINION AND ORDER directing as follows: (1) the 56 MOTION for Partial Summary Judgment is GRANTED as to the negligent construction and negligence claims in Counts One and Three; wantonness claims in Counts One, Two, and Three; the n egligent hiring, supervising, and training in Count Two; the suppression claim in Count Four; the third party beneficiary claim in Count Five; and deceptive trade practices claim in Count Eight, and judgment is entered in favor of Jeff Lindsey Commun ities, Inc. and against Nicholas Atkinson and Lenora Atkinson on those claims; (2) The Atkinsons will proceed on their claims against Jeff Lindsey Communities for breach of warranties (Count Six), breach of contract (Count Seven), nuisance (Count Nine), and tolling of the statute of limitations (Count Ten). Signed by Honorable Judge W. Harold Albritton, III on 4/4/16. (Attachments: # 1 civil appeals checklist)(djy, )
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
JEFF LINDSEY COMMUNTIIES, INC.,
Defendant/Third Party Plaintiff
DAVID ELLISON, CUSTOM VINYL
EXTERIORS, INC., and TONY JAMES
MASONRY, et al.,
Third Party Defendants.
CIVIL ACTION NO. 3:14-cv-1132-WHA
MEMORANDUM OPINION AND ORDER
This case is before the court on a Motion for Partial Summary Judgment (Doc. #56), filed
by the Defendant on February 12, 2016.
The Plaintiffs filed a Complaint on September 26, 2014 in the Circuit Court for Russell
County, Alabama. This case was removed to this court on November 3, 2014 on the basis of
diversity jurisdiction. The Plaintiffs are completely diverse in citizenship from the Defendants
and the amount in controversy exceeds $75,000. Therefore, the court may exercise diversity
jurisdiction over the Plaintiffs’ claims. See 28 U.S.C. §1332.
On January 15, 2015, Defendant Jeff Lindsey Communities, Inc. filed a Third-Party
Complaint against David Ellison, Custom Vinyl Exteriors, Inc., and Tony James Masory, the
sub-contractors for the construction of the Atkinsons’ home.
The Plaintiffs bring claims for negligence/wantonness: construction (Count One);
negligence/wantonness: hiring, supervising, and training (Count Two); negligence/wantonness
(Count Three); suppression (Count Four); third party beneficiary (Count Five); breach of
warranties (Count Six); breach of contract (Count Seven); deceptive trade practices (Count
Eight); nuisance (Count Nine); and tolling of the statute of limitations (Count Ten). The motion
for Partial Summary Judgment requests the dismissal of Counts One, Two, Three, Four, Five,
and Eight of the Complaint.
For reasons to be discussed, the Motion for Partial Summary Judgment is due to be
SUMMARY JUDGMENT STANDARD
Summary judgment is proper "if there is no genuine issue as to any material fact and . . .
the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S.
317, 322 (1986).
The party asking for summary judgment "always bears the initial responsibility of
informing the district court of the basis for its motion,@ relying on submissions Awhich it believes
demonstrate the absence of a genuine issue of material fact." Id. at 323. Once the moving party
has met its burden, the nonmoving party must Ago beyond the pleadings@ and show that there is a
genuine issue for trial. Id. at 324.
Both the party Aasserting that a fact cannot be,@ and a party asserting that a fact is
genuinely disputed, must support their assertions by Aciting to particular parts of materials in the
record,@ or by Ashowing that the materials cited do not establish the absence or presence of a
genuine dispute, or that an adverse party cannot produce admissible evidence to support the
fact.@ Fed. R. Civ. P. 56 (c)(1)(A), (B). Acceptable materials under Rule 56(c)(1)(A) include
Adepositions, documents, electronically stored information, affidavits or declarations, stipulations
(including those made for purposes of the motion only), admissions, interrogatory answers, or
To avoid summary judgment, the nonmoving party "must do more than show that there is
some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 586 (1986). On the other hand, the evidence of the nonmovant must be
believed and all justifiable inferences must be drawn in its favor. See Anderson v. Liberty Lobby,
477 U.S. 242, 255 (1986).
After the nonmoving party has responded to the motion for summary judgment, the court
shall grant summary judgment if the movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a).
The submissions of the parties establish the following facts, construed in the light most
favorable to the non-movant:
Nicholas and Lenora Atkinson (“the Atkinsons”), purchased a home at 248 Owens Road
in Fort Mitchell, Alabama 36856.
The Atkinsons are the first owners of the home. The
Defendant, Jeff Lindsey Communities, Inc., (“Lindsey”), constructed the home. Lindsey used
sub-contractors in the construction of the home. The Atkinsons and Lindsey entered into an
Alabama New Construction Purchase and Sale Agreement in June of 2010.
contained a Seller’s New Construction Property Disclosure Form stating, among other things,
that to the best of the knowledge and belief of the Seller as of the date of this disclosure, “The
residential structure has been or will be completed in accordance with the applicable building
codes, ordinances, and regulations.” (Doc. #56-2 at p.16). The closing on the home took place
on July 29, 2010.
The Atkinsons began noticing problems with the home after taking possession. They
noticed problems including water intrusion and rotting of their back door. The Atkinsons hired a
home inspector who identified construction defects and violations of the building code and
residential construction industry standards. The Atkinsons contend that the defects and violations
noted in the expert’s E-Services Report caused damage to their home.
Lindsey moves for summary judgment on the Atkinsons’ claims for negligent and wanton
construction (Count One); negligent and wanton hiring, supervising, and training (Count Two);
negligence and wantonness (Count Three); suppression (Count Four); third party beneficiary
(Count Five); and deceptive trade practices (Count Eight). In opposing the Motion, the
Atkinsons only make arguments and point to evidence in support of their negligence and
suppression claims. The Atkinsons agree that summary judgment is appropriate for their
wantonness, third-party beneficiary, and deceptive trade practices claims. (Doc. #63 at p.2).1
Accordingly, the court will discuss only the motion and opposition as they relate to the
negligence and suppression claims.
Lindsey moves for summary judgment on the negligence claims brought against it on the
ground that it cannot be liable for the actions of a subcontractor.
The court has reviewed the evidentiary material submitted by Lindsey and finds no question of fact as to any
material issue raised by them as a ground for summary judgment as to these claims. U.S. v. One Piece of Real
Property Located at 5800 SW 74th Ave., Miami, Fla., 363 F.3d 1099, 1101 (11th Cir. 2004).
Under Alabama law, a principal is not liable for the torts of an independent contractor,
Fuller v. Tractor & Equipment Co., Inc., 545 So. 2d 757 (Ala. 1989). Lindsey acknowledges
that there are exceptions which apply to non-delegable duties. See Fuller, 545 So. 2d at 759.
There are two common non-delegable duties recognized in Alabama. The first, a principal is not
shielded from liability for any activity that is “inherently or intrinsically dangerous.” Boroughs v.
Joiner, 337 So. 2d 340, 342 (Ala 1976). The second, a principal cannot be shielded from
liability for the negligent performance of a subcontractor when the principal owes certain
obligations to the other by contract or by law. Fuller, 545 So. 2d at 759.
Lindsey takes the position that neither of these non-delegable duty exceptions applies in
this case because construction is not inherently dangerous and there is no provision in the
Purchase and Sale Agreement that Lindsey would be responsible for the actions of the
The Atkinsons appear to have advanced two theories in support of their negligence
claims: a legal and a contractual non-delegable duty. In support of the former, they have cited
the court to Turner v. Westhampton Court, L.L.C., 903 So. 2d 82, 93 (Ala. 2004), for the
proposition that a builder is obligated to construct a house in a workmanlike manner.
In Turner, the homeowners who purchased a home from a contractor asserted a tort claim
based on the actions of the subcontractor which improperly installed a synthetic stucco. On
appeal, the purchasers raised the argument the Atkinsons have made in this case; namely, that the
contractor owed a nondelegable duty. Rather than decide that issue, however, the Supreme
Court of Alabama found that the argument had been waived. Turner, 903 So. 2d at 88-9. In the
same opinion, the court did acknowledge that a builder-vendor has an obligation to construct a
house that it will offer for sale in a workmanlike manner, but then stated that this “obligation
manifests itself in the implied warranty of workmanship.” Id. at 93. This court cannot conclude,
therefore, that Turner supports the finding of a legal non-delegable duty which gives rise to tort
The Atkinsons’ other non-delegable duty argument arises from contract language. They
have cited to provisions of the contract which state that to the best of the Seller’s knowledge and
belief, “[t]he residential structure on the Property has been or will be completed in accordance
with the applicable building codes, ordinances and regulations” (Doc. #56-2 at p. 16) and to
Exhibit K which states that work and materials will be supplied by Seller’s contractors and
In its initial Reply, Lindsey did not respond to the Atkinsons’ non-delegable duty
argument. When given an opportunity to file an additional response to the Atkinsons’ nondelegable duty argument, Lindsey acknowledged that there is a line of cases in Alabama law
which recognizes that a contractor can be held liable for the actions of a sub-contractor if the
contractor agrees to a non-delegable duty. (Doc. #71). For example, in Alabama Power Co. v.
Pierre, 183 So. 65 (Ala. 1938), the Pierres purchased electrical fixtures for their new home from
Alabama Power Company. As an inducement to close the deal, Alabama Power agreed to install
the fixtures at no charge. Alabama Power contracted with a third party to complete the actual
installation; during the installation the subcontractors inadvertently set the house on fire. The
Pierres sued Alabama Power, alleging that the installation of the fixtures was a non-delegable
duty. The Alabama Supreme Court agreed and observed that the duty was non-delegable as “far
as these plaintiffs were concerned, and the contractor may be treated in law as the agent or
servant of defendant, though as between the parties and in a strict legal sense such relationship
did not in fact exist.” 183 So. at 668. Similarly, in Fuller, 545 So. 2d at 759, S & M contracted
with T & E for the sale of a front-end loader with air conditioning. In the event that the air
conditioning was not installed properly, S & M would look to T & E to rectify the problem. T &
E undertook to provide air conditioning under the contract for sale and was thereby bound with
the non-delegable duty to ensure that the air conditioning was installed in a reasonable manner.
Fuller, 545 So. 2d at 759.
Lindsey refers the court to the Purchase and Sale Agreement between it and the
Atkinsons and argues that Pierre and Fuller are distinguishable from the instant case because in
this case there was no affirmative, contractual obligation in the contract.
This case is not identical to Pierre or Fuller, because those cases involved separate
installation agreements whereby the contractor undertook an affirmative obligation which was
then carried out by a subcontractor. In this case, there is a contract which generally refers to
providing materials and subcontractors, but which does not state an affirmative obligation to the
buyer regarding the subcontractors. The contract also includes a disclosure form which refers to
the construction of the structure. It is possible that the language in the disclosure form that, to
the best of the seller’s knowledge and belief, the construction was completed in accordance with
applicable codes, may support a claim for breach of contract or warranty, but that language does
not rise to the level of a contractual obligation as in the Pierre and Fuller line of cases to
preclude summary judgment on the negligence claims. Summary judgment is, therefore, due to
be GRANTED on the negligence claims.
Negligent Hiring, Supervision, and Training
Lindsey contends the only cognizable claim under Alabama law for negligent supervision
is a defendant’s supervision of its employees. Lindsey argues that it retained subcontractors to
perform the work and that because these subcontractors were not employees of Lindsey, Lindsey
cannot be liable for negligent supervision.
Even if the subcontractors were employees of
Lindsey, Lindsey contends the Atkinsons have not presented affirmative proof of the employees’
incompetence and that Lindsey should have known of the incompetence.
The Atkinsons state that Lindsey negligently supervised its subcontractors, as evidenced
by the code violations and damages set forth in the E-Services Report. The Atkinsons contends
that this was a voluntarily assumed duty breached by Lindsey. The Atkinsons do not, however,
address the argument that there is no evidence that Lindsey was or should have been aware of
any incompetence of the subcontractors.
Under Alabama law, it “is not sufficient merely to allege, or to show, that the employee
acted incompetently. A plaintiff must establish ‘by affirmative proof’ that the employer actually
knew of the incompetence, or that the employer reasonably should have known of it.”
Armstrong Bus. Servs., Inc. v. AmSouth Bank, 817 So. 2d 665, 683 (Ala. 2001). The Atkinsons
having failed to make such a showing, summary judgment is due to be GRANTED as to the
negligent supervision claim.
A claim of suppression requires a showing that (1) the defendant had a duty to disclose
the existing material fact; (2) that defendant suppressed this material fact; (3) that defendant’s
suppression of this fact induced the plaintiff to act or to refrain from acting; and (4) that plaintiff
suffered actual damage as a proximate cause. However, to be held liable, the defendant must
have knowledge of the material fact. Dodd v. Nelda Stephenson Chevrolet, Inc., 626 So. 2d
1288, 1292 (Ala. 1993).
Lindsey points out that Lenora Atkinson testified that she never had any conversations
with anyone from Lindsey where she believes they were lying to her or hiding information from
her intentionally. (Exhibit C at p. 30:18-23; 31:1-2). In Nicholas Atkinson’s deposition when
asked if there was anything Lindsey hid from him or intentionally did not tell him he responded
that they would not call him back, which happened after the purchase of the home. Lindsey
argues that any finding of knowledge or suppression would be mere speculation which is not
sufficient to sustain a judgment.
The Atkinsons contend in response that there is evidence which could support a
suppression claim. They state that Lindsey expressly stated to the Atkinsons in the purchase
contract entered into in June 2010, after the home was constructed, that the home was built
according to code, but that this was not true, as evidenced in the E-Services report, which is
dated June 25, 2014. The Atkinsons argue, therefore, that there is an inference that the fact that
the home was not built according to code was suppressed from them, causing them to purchase
Lindsey replies that there is no evidence to support an inference that Lindsey had any
knowledge of alleged suppressed facts.
The only evidence to substantiate knowledge of the
defects pointed to by the Atkinsons is the E-Services report made after the alleged suppression
occurred, not before. See Glenn Const. Co., LLC v. Bell Aerospace Servs., Inc., 785 F. Supp. 2d
1258, 1275 (M.D. Ala. 2011) (finding evidence of knowledge where project engineer possessed
documents which disclosed a condition it failed to disclose). The suppression at issue is alleged
to have occurred at the time of the contract. Because the Atkinsons have not pointed to evidence
which would allow for an inference of actual knowledge of the fact suppressed at the time of the
contract, the court must conclude that the Motion for Summary Judgment is due to be
GRANTED as to the suppression claim. See Glass v. S. Wrecker Sales, 990 F. Supp. 1344, 1350
(M.D. Ala. 1998) (“An action for suppression will lie only if the defendant actually knows the
fact alleged to be suppressed.”)
For the reasons discussed, it is hereby ORDERED as follows:
1. The Motion for Partial Summary Judgment (Doc. #56) is GRANTED as to the negligent
construction and negligence claims in Counts One and Three; wantonness claims in
Counts One, Two, and Three; the negligent hiring, supervising, and training in Count
Two; the suppression claim in Count Four; the third party beneficiary claim in Count
Five; and deceptive trade practices claim in Count Eight, and judgment is entered in
favor of Jeff Lindsey Communities, Inc. and against Nicholas Atkinson and Lenora
Atkinson on those claims.
2. The Atkinsons will proceed on their claims against Jeff Lindsey Communities for breach
of warranties (Count Six), breach of contract (Count Seven), nuisance (Count Nine), and
tolling of the statute of limitations (Count Ten).
Done this 4th day of April, 2016.
/s/ W. Harold Albritton
W. HAROLD ALBRITTON
SENIOR UNITED STATES DISTRICT JUDGE
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