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Liberty Mutual Fire Insurance Co. v. City of Seattle

United States District Court, W.D. Washington, Seattle

June 15, 2017

LIBERTY MUTUAL FIRE INSURANCE COMPANY, Plaintiff,
v.
CITY OF SEATTLE, CORE DESIGN, INC., and GROUND SUPPORT, Defendants. CITY OF SEATTLE, Third-Party Plaintiff, MALCOLM DRILLING CORPORATION, INC., Third-Party Defendant.

          ORDER GRANTING DEFENDANT GROUND SUPPORT'S MOTION FOR SUMMARY JUDGMENT

          JOHN C. COUGHENOUR UNITED STATES DISTRICT JUDGE

         This matter comes before the Court on Defendant Ground Support's motion for summary judgment and sanctions (Dkt. No. 83). Having thoroughly considered the parties' briefing and the relevant record, the Court finds oral argument unnecessary and hereby GRANTS the motion for summary judgment and DENIES the motion for sanctions for the reasons explained herein.

         I. BACKGROUND

         The facts of this case have been described in a previous order. (Dkt. No. 74 at 2-5.) In short, Rushforth Construction Company hired Third-Party Defendant Malcolm Drilling to furnish labor and materials for the bank shoring and underpinning work in the project at issue. (Dkt. No. 54 at ¶3.1.) Malcolm hired Ground Support to create a shoring plan. (Id. at ¶ 3.8.) The plans from each company did not include a side sewage line. (Dkt. No. 84-6 at 4-5.) Ultimately, the project caused damage to the not-included side sewage line, which was discovered in October 2012, and Rushforth paid for the repairs. (Dkt. No. 54 at ¶¶ 3.10, 3.13-3.14.) Plaintiff Liberty Mutual indemnified Rushforth, and Rushforth assigned all of its rights to Liberty Mutual. (Id. at ¶3.15.)

         A. Ground Support's Contract with Malcolm

         As described in the previous order, there was a question as to whether Ground Support's Master Agreement or Malcolm's Purchase Order governed this dispute. (See Dkt. No. 74 at 2-4.) After conducting discovery, the following has been established.

         Ground Support has been doing work for Malcolm since approximately 1994 and has prepared approximately 75-100 shoring plans/proposals for Malcolm. (Dkt. No. 84-11 at 3.) In 2010, Ground Support renegotiated its terms and conditions, referred to as the Master Agreement, with Malcolm's president, Al Rusband.[1] (Dkt. No. 67 at ¶ 7; Dkt. No. 84-12 at 4.) The Master Agreement contains a Limitation of Remedies clause that provides a one year time period from the substantial completion of Ground Support's services to bring a claim arising out of Ground Support's services. (Dkt. No. 58-1 at 8.) The Master Agreement also contains an express disclaimer of any warranties made in connection with Ground Support's services. (Id. at 2.) The renegotiated Master Agreement was sent to Malcolm for this 2011 project proposal. (Dkt. No. 67-2.) Malcom did not return a signed copy of the Master Agreement to Ground Support. (Dkt. No. 84-11 at 3.) However, it was common for Ground Support to perform work for Malcolm without a signed proposal being returned. (Dkt. No. 84-11 at 3.)

         To process a payment, Malcolm creates a Purchase Order, which contains different terms than the Master Agreement. (Dkt. No. 84-11 at 4.) Liberty Mutual claims the Purchase Order includes terms and conditions that require Ground Support to warrant its work and indemnify Malcolm for claims arising out of it. (Dkt. No. 65-3 at 9.) The Purchase Order does not contain a one-year limitation period. However, in response to a request for production for all documents reflecting Malcolm's transmittal of a Purchase Order for this project, Malcom responded “there is no record of transmittal . . . to Ground Support.” (Dkt. No. 84-14 at 11.) Malcolm's Corporate Senior Vice President John Roe testified that it was “reasonable” to say “Ground Support does not perform work for Malcolm subject to any terms and conditions contained in a Malcolm Purchase Order that never gets sent.” (Dkt. No. 84-12 at 6.)

         B. The Shoring Plan

         There was a preconstruction conference held on March 14, 2012, attended by Rushforth, Malcolm, and Ground Support. (Dkt. No. 84-5.) During that meeting, the City of Seattle's shoring inspector, Michael Houlihan, pointed out that the side sewer had not been depicted in any of the shoring plans and instructed Rushforth to find it. (Dkt. No. 84-6 at 5.) Rushforth and Malcom met and reviewed the sewer card and determined that there was no conflict between the side sewer and the location of the tiebacks. (Dkt. No. 84-8 at 3.) Ground Support was not involved in this meeting. (Id.) However, unknown to any of the contractors because it was not recorded on the sewer card, the side sewer had been moved and was hit during construction. (Dkt. No. 84-10 at 1.)

         On July 8, 2016, Liberty Mutual filed an amended complaint to include Ground Support as a defendant. (Dkt. No. 54.) Liberty Mutual filed two causes of action against Ground Support: warranty and contractual indemnification and negligence. (Id. at 10-11.) Plaintiff alleges that it is entitled to “indemnification from Ground Support under the terms of the Master Agreement and/or the Purchase Order.” (Dkt. No. 54 at ¶ 9.5.) Plaintiff also alleges that Ground Support was negligent in its preparation of the shoring plan, (id. at 10), and did not inform Malcolm that it failed to depict the outdated location of the sewer line on the shoring plan until February 2014, (Dkt. No. 65-1 at 2-3). Ground Support now moves for summary judgment on these two claims and for sanctions. (Dkt. No. 83.)

         II. DISCUSSION

         A. Legal Standard

         “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). In making such a determination, the Court must view the facts and justifiable inferences to be drawn therefrom in the light most favorable to the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Once a motion for summary judgment is properly made and supported, the opposing party “must come forward with ‘specific facts showing that there is a genuine issue for trial.'” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (quoting Fed.R.Civ.P. 56(e)). Material facts are those that may affect the outcome of the case, and a dispute about a material fact is genuine if there is sufficient evidence for a reasonable jury to return a verdict for the non-moving party. Anderson, 477 U.S. at 248-49. Conclusory, non-specific statements in affidavits are not sufficient, and “missing facts” will not be “presumed.” Lujan v. National Wildlife Federation, 497 U.S. 871, 888-89 (1990). ...


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