Developers Surety & Indemnity Co. v. Renaissance/Valley Farms, LLC

30 F. Supp. 3d 606, 2014 WL 2993746, 2014 U.S. Dist. LEXIS 90105
CourtDistrict Court, W.D. Kentucky
DecidedJuly 2, 2014
DocketNo. 3:11-CV-00090-CRS-JDM
StatusPublished

This text of 30 F. Supp. 3d 606 (Developers Surety & Indemnity Co. v. Renaissance/Valley Farms, LLC) is published on Counsel Stack Legal Research, covering District Court, W.D. Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Developers Surety & Indemnity Co. v. Renaissance/Valley Farms, LLC, 30 F. Supp. 3d 606, 2014 WL 2993746, 2014 U.S. Dist. LEXIS 90105 (W.D. Ky. 2014).

Opinion

MEMORANDUM OPINION

CHARLES R. SIMPSON III, Senior District Judge.

This action was initially brought to enforce an encroachment bond issued by the plaintiff, Developers Surety and Indemnity Company (“Developers”), to Renaissance/Valley Farms, LLC and its affiliated entities. The matter is now before the court on three motions for summary judgment relating to the Amended Third Party Complaint of Renaissance/Valley Farms, LLC, Donald J. Cook, and DKCD, Inc. (DN 104), and the Third Party Complaint of T & C Contracting, Inc. (DNs 53, 119, 121,123).

I.

This action has a complex factual and procedural history that the court has detailed below to put the pending motions in their proper context.

A. Factual Background

In 2004, Defendant/third party plaintiff Renaissance/Valley Farms, LLC (“Renaissance/Valley”) commenced construction of the Valley Farms subdivision on the north side of Valley Station Road in Louisville, Kentucky. Renaissance/Valley needed to widen Valley Station Road and construct additional lanes of traffic, including a center turning lane, to accommodate the increased traffic that was anticipated from the new development. Because Valley Station Road is a state-owned right-of-way under the control of the Kentucky Transportation Cabinet (“KYTC”), Renaissance/Valley applied to the KYTC for an [608]*608encroachment permit that would allow it to engage in construction on the roadway. The KYTC requires that all encroachment permit applications be accompanied by a bond or cash indemnity. Accordingly, Renaissance/Valley entered into an indemnity agreement dated September 14, 2004 with Developers, pursuant to which Developers issued an Encroachment Permit Bond to Renaissance/Valley on January 7, 2005. The bond bound Developers as a surety for the KYTC’s benefit for work performed on the Valley Station Road construction project.

Renaissance/Valley contracted with DKCD, Inc.,1 a related company with similar ownership, to serve as the construction manager of the project. DKCD, Inc., in turn, retained Heritage Engineering, LLC (“Heritage”) to prepare engineering plans for the roadway, which were submitted to the KYTC for approval. After receiving the necessary approval, the KYTC issued an encroachment permit to Renaissance/Valley in February 2005 for site grading, storm piping, constructing detention basins, and adding turn lanes on Valley Station Road.

In August 2005, DKCD, Inc. contracted with T & C Contracting, Inc. (“T & G”) to construct the roadway in accordance with the plans that Heritage had designed. However, sometime between the February 2005 issuance of the encroachment permit and the time that T & C commenced construction in October 2005, the Renaissance Parties instructed Heritage to revise the plans to include, among other things, “spot elevations” for the roadway. Apparently, these revised plans were not submitted to the KYTC for approval, but both T & C and Heritage claim that Renaissance/Valley gave the revised plans to T & C with instructions to construct the roadway in accordance with those plans.

After construction was completed, Robert Rogers, a KYTC employee, inspected the roadway and issued an Encroachment Inspection Notice to Renaissance/Valley dated July 24, 2008. The Inspection Notice served as a notice to Renaissance/Valley that the KYTC was rejecting the completed roadway on the basis that: (1) the work was not timely completed; (2) the turning lane did not have the correct cross slope; and (3) there was a “[djangerous edge drop off’ between the edge of the roadway and a paved ditch. (DN 123-6, p. 2). Having found the roadwork unacceptable, the KYTC thereupon lodged a claim with Developers and sought its performance under the 2005 encroachment permit bond. Developers then contracted with Louisville Paving Company, Inc. to complete remediation work on the road in a manner acceptable to the KYTC, allegedly incurring substantial additional costs as a result.

B. Procedural Background

Developers brought an action in this court, pursuant to diversity jurisdiction, against Renaissance/Valley and its related parties to enforce Developers’ rights under the indemnity agreement dated September 4, 2004.2 In response, Renaissance/Valley, [609]*609Donald J. Cook, and DKCD, Inc. (collectively, the “Renaissance Parties”) brought third-party claims against T & C seeking contractual and common law indemnity. (Am. Third Party Compl., DN 104). The Renaissance Parties allege that T & C breached the térms of its subcontract and negligently performed the construction work. (Id.). T & C thereafter brought third-party claims against Heritage,3 the design engineer of the roadway, for indemnity, contribution, and apportionment as to the claims asserted against T & C by the Renaissance Parties. (Third Party Compl., DN 53).

The motions presently before the court address the third-party claims brought by the Renaissance Parties against T & C, as well as the third-party claims that T & C has made against Heritage. T & C has moved for summary judgment on all counts of the Renaissance Parties’ Amended Third Party Complaint. (DN 119). Heritage has also moved for summary judgment on all counts of T & C’s Third Party Complaint. (DN 121). Both T & C and Heritage contend they are entitled to summary judgment on the respective claims filed against them because the Renaissance Parties were responsible for the KYTC’s rejection of the roadway and, in their view, should bear the costs attributable to their own omissions. They argue that the KYTC did not approve the roadway because it did not comport with engineering plans that were submitted with the encroachment permit. T & C and Heritage argue that the Renaissance Parties had an affirmative duty to submit the ra-vised plans to the KYTC and should bear any loss deriving from this failure. The Renaissance Parties, in response, have filed a cross-motion for partial summary judgment on the breach of contract and indemnity counts contained in their Amended Third Party Complaint. (DN 123). These three motions are now before the court for our consideration.

II.

A court may grant a motion for summary judgment if it finds that there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). The moving party bears the initial burden of specifying the basis for its motion and identifying that portion of the record which demonstrates the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once the moving party satisfies this burden, the nonmoving party thereafter must produce specific facts demonstrating a genuine issue of fact for trial. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

The evidence must be construed in a light most favorable to the party opposing the motion. Bohn Aluminum & Brass Corp. v. Storm King Corp., 303 F.2d 425 (6th Cir.1962).

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Bluebook (online)
30 F. Supp. 3d 606, 2014 WL 2993746, 2014 U.S. Dist. LEXIS 90105, Counsel Stack Legal Research, https://law.counselstack.com/opinion/developers-surety-indemnity-co-v-renaissancevalley-farms-llc-kywd-2014.