Where a general contractor hired a scaffolding subcontractor for a hotel renovation project, an employee of that subcontractor suffered injury during his work, and he filed a petition against the hotel. The hotel filed a third party claim against the GC who then filed its own third party claim against the subcontractor seeking indemnification as well as insurance coverage as an additional insured. The court denied the subcontractor’s motion for summary judgment concluding that other than a written subcontract proposal there was no executed written contract. This was reversed on appeal. Although there was an oral contract, there was no evidence that the parties had agreed to have the subcontractor indemnify the GC or name the GC as an additional insured on its policies. Maroulis v. Entergy Louisiana, LLC. 2021 WL 485327 (Louisiana 2021).
“Sunbelt needed only to show an absence of evidentiary support for Castleman’s claims against it to prevail. The evidence introduced by Castleman in support of its claims against Sunbelt included a pricing proposal from Sunbelt, a certificate of insurance showing Sunbelt had obtained an insurance policy from ACE, and the deposition testimony of Ms. Linda Castleman Donlea, a principal of Castleman.
Unlike the prime AIA construction contract between Hotel Investors and Castleman, it is undisputed that no written contract existed between Castleman and Sunbelt. It is also clear that some form of agreement existed between Castleman and Sunbelt whereby Castleman agreed to pay Sunbelt certain sums of money in exchange for scaffolding and other construction services.”
With regard to the written pricing proposal, the court found: “this pricing proposal makes no mention of naming Castleman as an additional insured and does not state that Sunbelt will indemnify Castleman in case of injury to the workers. This pricing proposal supports only the fact that there was a construction agreement between Sunbelt and Castleman, not Castleman’s claims that there were agreements to include it as an additional insured on the ACE policy.” The parties thus were proceeding to perform the work under an oral agreement.
Where an oral contract is for an amount greater than $500 in Louisiana, at least one witness and other corroborating circumstances must prove the contract. There was no corroborating evidence offered here. The court found, “none of this evidence shows that there ever existed an indemnity agreement between the parties or that Sunbelt was ever obligated to name Castleman as an additional insured on its insurance policy. In the absence of evidence of such an agreement, the trial court erred in denying Sunbelt’s motion for summary judgment.”
About the author: Article written by J. Kent Holland, Jr., a construction lawyer located in Tysons Corner, Virginia, with a national practice (formerly with Wickwire Gavin, P.C. and now with ConstructionRisk Counsel, PLLC) representing design professionals, contractors and project owners. He is founder and president of a consulting firm, ConstructionRisk, LLC, providing consulting services to owners, design professionals, contractors and attorneys on construction projects. He is publisher of ConstructionRisk Report and may be reached at Kent@ConstructionRisk.com or by calling 703-623-1932. This article is published in ConstructionRisk Report, Vol. 24, No. 2 (February 2022).
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