Southcrest, L.L.C. v. Bovis Lend Lease, Inc. et al

Filing 527

OPINION AND ORDER by Judge Claire V Eagan that Fourth Party Defendant Southern Plastering, Inc.'s Motion for Relief from Order and Brief in Support (Dkt. # 508) is granted and that Southern Plastering's motion for summary judgment (Dkt. # 429) is reinstated. Southern Plastering's motion for summary judgment (Dkt. # 429) is denied. ; granting 508 Motion for Relief (Re: 429 MOTION for Summary Judgment and Brief in Support ) (RGG, Chambers)

UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF OKLAHOMA
SOUTHCREST, L.L.C.,
Plaintiff,
v.
BOVIS LEND LEASE, INC., and
DELTA/UNITED SPECIALTIES, INC.,
Defendants.
___________________________________
BOVIS LEND LEASE, INC.,
Third Party Plaintiff,
v.
DELTA/UNITED SPECIALTIES,
PROFESSIONAL WATERPROOFING
AND ROOFING, INC., and RUSSELL
PLUMBING HEAT & AIR COMPANY
D/B/A RUSSELL MECHANICAL
CONTRACTORS,
Third Party Defendants,
____________________________________
DELTA/UNITED SPECIALTIES,
Fourth-Party Plaintiff,
v.
SOUTHERN PLASTERING, INC.,
Fourth-Party Defendant.

)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)

Case No. 10-CV-0362-CVE-FHM

OPINION AND ORDER
Now before the Court is Fourth Party Defendant Southern Plastering, Inc.’s Motion for
Relief from Order and Brief in Support (Dkt. # 508). Southern Plastering, Inc. (Southern Plastering)
requests that, pursuant to Fed. R. Civ. P. 60(b), this Court vacate its order mooting Southern
Plastering’s summary judgment motion and adjudicate that motion on the merits. There has been
no response to Southern Plastering’s motion and the deadline to respond has passed.
I.
The facts and procedural history of this case have been recited by this Court many times.
Only those facts that are directly relevant to the pending motion will be set forth here.

On or about December 17, 1997, Southcrest, L.L.C. (Southcrest) entered into a contract with
Bovis Lend Lease, Inc. (Bovis) for the construction of Southcrest Hospital. Dkt. # 190 at 3. The
construction of the original hospital was completed on March 12, 1999. Id. Between 1999 and
2001, Southcrest contracted with Bovis for the construction of three additions to the hospital: a
catheter lab, an operating room, and the 5th and 6th floors of the hospital tower. Id. Bovis acted
as the general contractor on these projects. Dkt. # 90 at 3. Southcrest alleges that due to
“particularly poor construction and serious design flaws” the hospital additions have succumbed to
“extensive moisture intrusion and water damage.” Dkt. # 190 at 13-14.
Southcrest filed its initial complaint on June 4, 2010 against Bovis, Gould Turner Group,
P.C. (Gould) and Carlisle Syntec, Inc (Carlisle).1 Dkt. # 2. The initial complaint alleged claims for
relief based on negligence, breach of contract, breach of implied warranty, and breach of express
warranty. Dkt. # 2. The claims for breach of contract and breach of implied warranty were
dismissed as untimely. Dkt. # 63. The Court then granted in part Southcrest’s motion to file an
amended complaint, which added detail regarding plaintiff’s negligence claims, an alternative theory
of liability based on fraud, a negligence claim against Delta/United Specialties (Delta), and a request
for punitive damages. Dkt. # 190. The first amended complaint abandoned the contract and
warranty claims and alleges claims of negligence only. Dkt. # 190.
The Court also granted Bovis leave to file a third-party complaint, which Bovis then filed
against several subcontractors, including Delta. Dkt. ## 90; 184. Delta then filed a fourth-party

1

All claims against Gould and Carlisle have been resolved and they are no longer parties to
this action. See Dkt. ## 253, 270.
2

complaint against its subcontractor, Southern Plastering, for contribution and/or indemnification.
Dkt. # 182.
On May 30, 2012, Southern Plastering filed a motion for summary judgment alleging that
Southcrest’s claims of negligence were barred by the statute of limitations. Dkt. # 429. While that
motion was pending, Southcrest filed stipulations of dismissal voluntarily dismissing its claims
against Delta and Bovis. Dkt. ## 477, 478. As a result of the stipulations, the Court issued an order
directing Southcrest and Delta to show cause as to why Southern Plastering’s motion for summary
judgment should not be dismissed as moot because it addressed Southcrest’s claim, and Southcrest
had dismissed all of its claims. Dkt. # 483. Southcrest responded that the summary judgment
motions were indeed moot (Dkt. # 486), and this Court then found them moot. Dkt. # 488. Because
Southcrest had no remaining claims in the litigation, it was terminated as a party. Id. Bovis and
Delta were terminated as defendants. Id. However, Bovis and Delta’s third and fourth-party claims
remain against certain third and fourth-party defendants. Specifically, as it pertains to the pending
motion, Delta has fourth-party claims against Southern Plastering for contribution and
indemnification. For purposes of the pending motion, the only remaining issue in this action is
whether Delta is entitled to indemnification and/or contribution from Southern Plastering.2
II.
Southern Plastering moves for relief pursuant to Fed. R. Civ. P. 60(b)(1) and (b)(3), which
provide:

2

The only other remaining issues, not pertinent to the pending motion, are whether Bovis is
entitled to contribution or indemnification from Delta, Professional Waterproofing and
Roofing, Inc., and/or Russell Plumbing Heat & Air Company.
3

On motion and just terms, the court may relieve a party or its legal representative
from a final judgment, order, or proceeding for the following reasons: (1) mistake,
inadvertence, surprise, or excusable neglect; [or] (3) fraud (whether previously called
intrinsic or extrinsic), misrepresentation, or misconduct by an opposing party . . . .
Fed. R. Civ. P. 60(b). The Tenth Circuit has held that the “‘mistake’ provision in Rule 60(b)(1)
provides for the reconsideration of judgments [or orders] only where: (1) a party has made an
excusable litigation mistake or an attorney in the litigation has acted without authority from a party,
or (2) where the judge has made a substantive mistake of law or fact in the final judgment or order.”
Cashner v. Freedom Stores, Inc., 98 F.3d 572, 576 (10th Cir. 1996). “Rule 60(b) relief is
extraordinary and may only be granted in exceptional circumstances. . . . Parties seeking relief under
Rule 60(b) have a higher hurdle to overcome because such a motion is not a substitute for an
appeal.” Zurich N. Am. v. Matrix Serv., Inc., 426 F.3d 1281, 1289 (10th Cir. 2005). The Court has
substantial discretion in connection with a Rule 60(b) motion. Pelican Production Corp. v. Marino,
893 F.2d 1143, 1146 (10th Cir. 1990).
III.
A.

Southern Plastering’s Motion for Relief from Order
Southern Plastering seeks relief from this Court’s order (Dkt. # 488) mooting Southern

Plastering’s summary judgment motion. Southern Plastering argues that the order was based on
mistake and/or misrepresentation because the summary judgment motion was not only directed to
Southcrest, but was also directed to the indemnification and contribution claims brought by Delta.
Thus, Southern Plastering argues, the summary judgment motion is not moot and should be
adjudicated on the merits.

4

Having reviewed the summary judgment motion, and in light of the fact that there is no
opposition to the motion for relief, the Court will vacate its finding that Southern Plastering’s motion
for summary judgment is moot, reinstate the motion, and adjudicate it on the merits.
B.

Southern Plastering’s Motion for Summary Judgment
In its summary judgment motion, Southern Plastering argues that Delta’s contribution and

indemnification claims must fail because any claim of negligence by Southcrest against Southern
Plastering would be barred by the statute of limitations.3 Southcrest opposed the summary judgment
motion (Dkt. # 451), but Delta did not file a response. Thus, pursuant to LCvR 56.1, the summary
judgment motion is deemed confessed by Delta, and the material facts stated therein are deemed
admitted as to Delta. See LCvR 56.1(c) (“All material facts set forth in the statement of the material
facts of the movant shall be deemed admitted for the purpose of summary judgment unless
specifically controverted by the statement of material facts of the opposing party.”).
It is undisputed that Delta contracted with Southern Plastering to install insulation on the 6th
floor addition to the hospital. Dkt. # 182 at 3; Dkt. # 429 at 11. It is further undisputed that the
installation of this insulation was the only work performed by Southern Plastering on any part of the
hospital. Id. Southern Plastering presents evidence that Southcrest knew of water intrusion in the
original hospital building as early as 1998 (Dkt. # 429 at 9-11) and that Southcrest knew of water
intrusion in the additions to the hospital as early as 2003 (Dkt. # 429 at 12-20). Southern Plastering
argues that, because Southcrest’s initial complaint was not filed until June 4, 2010, it was filed more
than two years after discovery of the damage and is thus barred by the statute of limitations.

3

Southern Plastering’s summary judgment motion also raised arguments concerning a
purported assignment of Delta’s claims to Southcrest. Because the Court recently held that
the purported assignment was ineffective (Dkt. # 524), these issues are moot.
5

While Delta’s claims against Southern Plastering are not for negligence, but for contribution
and indemnification, Southern Plastering is entitled to raise any defense to those claims that it could
raise in a direct negligence action. See Barringer v. Baptist Healthcare of Okla., 22 P.3d 695, 698
(Okla. 2001) (stating that defendant in contribution action “may assert . . . any other available
defenses . . . .”).4 Thus, if Southcrest could not have maintained a negligence claim against Southern
Plastering because of the expiration of the statute of limitations, then Delta cannot recover from
Southern Plastering for contribution or indemnity.
A cause of action for an injury based on negligence must be brought within two years of the
accrual of the cause of action. OKLA. STAT. tit. 12, § 95(A)(3). However, in certain circumstances,
the statute is subject to a discovery rule, which “provides that the limitations period does not begin
to run until the date the plaintiff knew or should have known of the injury.” Samuel Roberts Noble
Foundation v. Vick, 840 P.2d 619, 624 (Okla. 1992). Put another way, the statute of limitations
begins to run on the date that plaintiff acquires “sufficient information which, if pursued, would lead
to the true condition of things . . . .” Daugherty v. Farmers Cooperative Ass’n, 689 P.2d 947, 950-51
(Okla. 1984). “The operative date is that date on which plaintiff could have brought suit.” Vick, 840
P.2d at 625. The Oklahoma Supreme Court has held that the discovery rule applies in actions for
negligence concerning construction contracts. Id. at 625. Under Oklahoma law, “[t]he party

4

Southern Plastering does not cite any legal authority for its position that an indemnification
claim may be barred by the expiration of the statute of limitations of the initial negligence
claim, and the Court has not located any Oklahoma authority on point. However, because
Delta failed to oppose the summary judgment motion, it is estopped from arguing that
Southern Plastering cannot raise the statute of limitations as a defense. In addition, the
Federal Rules of Civil Procedure allow a third-party defendant “to assert against the plaintiff
any defense that the third-party plaintiff has to the plaintiff’s claim.” Fed. R. Civ. P.
14(a)(2)(C).
6

asserting the limitations defense has the burden to present evidence reasonably tending to establish
the time-bar.” MBA Commercial Constr., Inc. v. Roy J. Hannaford Co., 818 P.2d 469, 472
(Okla.1991). The determination of when a “plaintiff has sufficient knowledge to know that an
actionable defect exists . . . is generally one of fact.” Vick, 840 P.2d at 626.
The statute of limitations on a negligence claim against Southern Plastering began to run
when Southcrest knew or should have known of the injury or defects or when Southcrest had
sufficient information which, if pursued, would have led to discovery of the damage. Southern
Plastering argues that Southcrest knew of the damage to the building as early as 2003, when a leak
was identified in the ceiling on the 4th floor. Dkt. # 429 at 12. Southern Plastering provides
evidence of over 20 specific incidences of water intrusion and/or mold that occurred on the 1st, 2nd,
3rd, 4th, 5th, and 6th floors of the hospital between 2003 and 2008. Id. at 12-20. Based on this
series of incidents, Southern Plastering argues that Southcrest knew of damage to the hospital prior
to June 2008, two years before this case was filed. Thus, Southern Plastering argues this action was
filed after the expiration of the statute of limitations.
It is undisputed that Southcrest was aware of certain leaks in the building as early as 2003.
However, this evidence does not definitively prove that these individual problems put Southcrest
on notice that there was damage to the 6th floor of the building and that it might have a claim related
to the contractors who worked on that area. Many of the leaks were on the 1st, 2nd, 3rd, 4th, and
5th floors. Of the over 20 specific incidents identified by Southern Plastering, only five specifically
dealt with problems on the 6th floor. Southern Plastering admits that there “was no widespread
water intrusion on the 6th floor.” Id. at 18. Southcrest’s maintenance worker testified that, at one
point, Southcrest believed the problem was with the windows and the window manufacturer. Id. at

7

14. Based on this evidence, a reasonable jury could conclude that the series of leaks occurring
between 2003 and 2008 did not put Southcrest on notice that it had a problem on the 6th floor. A
jury could also conclude that a reasonable investigation of the leaks would not have led to discovery
of problems on the 6th floor. Thus, there is a genuine dispute of material fact concerning whether
the other known defects were related to the damage on the 6th floor and whether a reasonable
investigation of the other known defects would have led to a discovery of the problems on the 6th
floor. Because there is a genuine dispute of material fact as to when the statute of limitations began
to run, summary judgment must be denied. See Delashaw v. Tyson Foods, Inc., 100 F. App’x 762,
767 (10th Cir. 2004) (unpublished)5 (reversing summary judgment where there were issues of fact
concerning whether claims were “related to the other design and construction defects that plaintiffs
were aware of” earlier and whether “reasonable investigation of the other known defects would have
led to a discovery of the problems” related to the litigation).
IT IS THEREFORE ORDERED that Fourth Party Defendant Southern Plastering, Inc.’s
Motion for Relief from Order and Brief in Support (Dkt. # 508) is granted and that Southern
Plastering’s motion for summary judgment (Dkt. # 429) is reinstated.
IT IS FURTHER ORDERED that Southern Plastering’s motion for summary judgment
(Dkt. # 429) is denied.
DATED this 30th day of August, 2012.

5

Unpublished decisions are not precedential, but may be cited for their persuasive value. See
Fed. R. App. P. 32.1; 10th Cir. R. 32.1.
8