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Where a contractor filed suit alleging that an engineering firm was negligent in designing, engineering and surveying land where a group of homes were planned to be built, the trial court granted summary judgment for the engineer because expert testimony offered by the contractor was insufficient to establish a standard of care that the engineering firm could be judged by to determine negligence. The dismissal was granted without prejudice, however, and the engineer filed an appeal to require the dismissal be granted with prejudice to assure finality of the decision.

Facts and Allegations

This case involves construction design defects relating to water-table or drainage. Pond Hollow Homeowner’s Association, which owned a group of homes plagued by such defects, sued Ryland, the general contractor on the project. In an attempt to indemnify itself against suit by the association, the contractor then filed suit for negligence against Pioneer Engineering, which was responsible for designing, engineering and surveying the site.

Prior to trial, the contractor put forth an affidavit from an expert witness to address the applicable standard of care of the engineering firm. With regards to such a standard, the contractor’s expert stated that “it is my opinion that Pioneer . . . deviated from the standard of care applicable to engineers in that it failed to properly recognize and evaluate the water table when determining the minimum building pad evaluations.”

The trial court ruled that this testimony was inadequate in establishing the standard of care and granted summary judgment for the engineering firm. However, the court’s decision was granted without prejudice; therefore, the contractor could bring another suit putting forth the same claims. Both rulings of the trial court were appealed to the Minnesota appellate court.

Inadequacy of the Expert Witness Affidavit

The appellate court reasoned that the witness did “not explain how a ‘proper’ evaluation or recognition is performed, nor [did] he explain industry practices or refer to contract or industry guidelines related to evaluation or recognition of a water table.” Although the witness did refer to the “applicable standard of care applicable to engineers, . . . no such universal standard is defined in the affidavit. Caselaw dictates that Ryland was required to establish a standard of care tailored to the work that Pioneer was hired to perform.”

Because the requisite standard was not put forth through adequate expert testimony, the appellate court agreed that the trial court should have granted summary judgment but held that the summary judgment should have constituted a final judgment in favor of the engineer.

The Trial Court’s Error in failing to dismiss the case with Prejudice.

The engineering firm argued the trial court should have dismissed the contractor’s claims with prejudice. In rendering its decision, the trial court concluded that while it granted summary judgment for the engineering firm, the judgment was without prejudice since separate litigation existed with another entity that originally owned the property.

The appellate court found the trial court erred in dismissing the case without prejudice. The court reasoned that since the testimony attempting to establish negligence was inadequate, there was no legal basis for the contractor’s claims. Therefore, the dismissal constituted a determination on the merits and the case should have been dismissed with prejudice. Such a dismissal prevents the same claims against the engineering firm from being relitigated. Thus, the trial court’s ruling on this issue was overturned and judgment was entered in favor of the engineering firm. Pond Hollow Homeowners Association v. The Ryland Group, Inc., 779 N.W.2d 920 (Minn. App. 2010).

About the author: J. Kent Holland is a construction lawyer located in Tysons Corner, Virginia, with a national practice (formerly with Wickwire Gavin, P.C. and now with Construction Risk Counsel, PLLC) representing design professionals, contractors and project owners. He is also founder and president of ConstructionRisk, LLC, a consulting firm providing consulting services to owners, design professionals, contractors and attorneys on construction projects. He is publisher of ConstructionRisk.com Report and may be reached at Kent@ConstructionRisk.com or by calling 703-623-1932. This article is published in ConstructionRisk.com Report (2010) at www.ConstructionRisk.com