IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

ANN ARROYO, :

: C.A. No: K13C-12-028 RBY

Plaintiff, : In and for Kent County

:

v. :

:

REGAL BUILDERS, LLC, REGAL :

CONTRACTORS, LLC, and PALA :

TILE & CARPET CONTRACTORS, INC., :

:

Defendants. :

Submitted: August 2, 2016

Decided: September 20, 2016

Upon Consideration of Defendant Pala Tile & Carpet Contractors, Inc.’s

Motion for Summary Judgment

DENIED

ORDER

Robert C. McDonald, Esquire, Silverman McDonald & Friedman, Wilmington,

Delaware for Plaintiff.

Noel E. Primos, Esquire, Schmittinger & Rodriguez, P.A., Dover, Delaware for

Defendants Regal Builders, LLC, and Regal Contractors, LLC.

Neil J. Levitsky, Esquire, Fox Rothschild, LLP, Wilmington, Delaware for Defendant

Pala Tile & Carpet Contractors, Inc.

Young, J.
Arroyo v. Regal Builders, LLC, et al. 

C.A. No.: K13C-12-028 RBY

September 20, 2016

SUMMARY

Plaintiff homeowner brought contract and tort claims against Defendant

general contractor and Defendant subcontractor, alleging that flaws in construction

of her new home resulted in the need to relocate and repair. Defendant subcontractor

now moves for summary judgment on all claims against it based on a lack of privity

of contract and of any direct liability to Plaintiff. Because factual issues remain

relative to the application of the law to the circumstances here presented, Defendant

subcontractor’s motion is DENIED.

Additionally, Defendant contractor filed a response requesting permission to

maintain its cross-claim against Defendant subcontractor. No party has moved to

dismiss Defendant contractor’s claims against Defendant subcontractor. Therefore,

the “request” of Defendant contractor to continue its claim against Defendant

subcontractor is not considered.

FACTS AND PROCEDURES

In December 2011, Ann Arroyo (“Plaintiff”) purchased and took delivery of

a new construction home built by Defendant general contractor Regal Builders, LLC

and Regal Contractors, LLC (combined, “Regal”) with additional tiling and flooring

work done by Defendant subcontractor Pala Tile & Carpet Contractors, Inc. (“Pala”).

In December 2013, Plaintiff filed suit claiming breach of duty/negligence, breach of

contract/negligence, and breach of express and implied warranty against Regal and

Pala. Plaintiff alleges that significant defects in the home discovered during the first

year of ownership necessitated her temporary relocation and repair. Defendant Pala

now moves for summary judgment as to all claims against it.

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Arroyo v. Regal Builders, LLC, et al. 

C.A. No.: K13C-12-028 RBY

September 20, 2016

STANDARD OF REVIEW

Pursuant to Superior Court Civil Rule 56, summary judgment is appropriate

when there is no genuine issue of material fact so that the moving party is entitled to

judgment as a matter of law.

1

“Summary judgment may not be granted if the record

indicates that a material fact is in dispute, or if it seems desirable to inquire more

thoroughly into the facts in order to clarify the application of the law to the

circumstances.”

2 The court should consider the record in the light most favorable to

the non-moving party.

3 The moving party bears the burden of showing that no

genuine issues of material fact exist.

4

DISCUSSION

Counsel for Plaintiff, the party against which this Motion is filed, has asserted

that issues of fact remain, contradicting moving Pala’s statement that no issues of

material fact exist. That bare allegation by Plaintiff may be sufficient, in itself, to

preclude a summary judgment dismissal. In this case, there is very little presented to

support either position. Hence, the outcome here will not hinge on that minimal

factor. Rather, the analysis will concern the claims against moving Defendant in the

tort or contractual context.

Pala moves for summary judgment as to the breach of contract claim, alleging

1 Tedesco v. Harris, 2006 WL 1817086, at *1 (Del. Super. June 15, 2006). 

2

Id.

3

Id.

4 Moore v. Sizemore, 405 A.2d 679, 680 (Del. Super. 1979). 

3
Arroyo v. Regal Builders, LLC, et al. 

C.A. No.: K13C-12-028 RBY

September 20, 2016

that no privity of contract exists between Plaintiff and Pala. Pala also moves for

summary judgment as to the breach of duty claim, asserting that no duty runs from

subcontractor to property owner based on a separate contract between owner and

general contractor. Finally, Pala moves for summary judgment on the breach of

express or implied warranty, asserting that it cannot be held liable on this claim.

Pala’s central argument is that no contract or tort liability can attach given Pala’s

status as a subcontractor.

In response, Plaintiff admits that no privity of contract exists between Plaintiff

and Pala. Instead, Plaintiff argues that Pala is accountable to her under third party

beneficiary principles. According to Plaintiff, Pala was required to satisfy Regal’s

obligation under the contract to construct flooring consistent with its own plans and

specifications.

If floors in a house are defective, the whole house is defective, as they are

critical to the very nature of the project contracted for. So the party installing the

floors, if that installation is faulty, is liable over to the home owner in tort, contract,

either or both theories. Delaware case law has long and often recognized such

liability.

Contract Liability

In Oliver B. Cannon and Son, Inc. v. Dorr-Oliver, Inc.,

5

a premises owner sued

a subcontractor for property damage caused by its poor workmanship.

6 The Delaware

5

 336 A.2d 211 (Del. 1975). 

6

Id. at 213. 

4
Arroyo v. Regal Builders, LLC, et al. 

C.A. No.: K13C-12-028 RBY

September 20, 2016

Supreme Court affirmed judgment finding that the subcontractor was liable to both

the general contractor and the owner, holding that the owner was a third party

beneficiary of the subcontract.

7

In the subsequent case of Seiler v. Levitz Furniture

Co.,

8

the Supreme Court found negligence liability available under third-party

beneficiary principles,

9 which concept Plaintiff urges this Court to adopt to find Pala

accountable to Plaintiff as a third party beneficiary of the contract between Pala and

Regal.

Tort Liability

Delaware case law supports recovery by a plaintiff in a negligence action for

economic losses even absent contractual privity with the defendant.

10

In Guardian

Construction Co. v. Tetra Tech Richardson, Inc.,

11

the Delaware Superior Court

addressed the development of the law and concluded that “privity of contract is not

an indispensable prerequisite to the recovery of economic damages in negligence

cases.”

12 Liability may be imposed in favor of a third party beneficiary according to

the following rule:

7

Id. at 215-16. 

8

 367 A.2d 999 (Del. 1976).

9

Id. at 1007.

10 See, e.g., Martin v. Ryder Truck Rental, 353 A.2d 581 (Del. Super. 1976). 

11

 583 A.2d 1378 (Del. Super. 1990)

12

Id. at 1386.

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Arroyo v. Regal Builders, LLC, et al. 

C.A. No.: K13C-12-028 RBY

September 20, 2016

where it is the intention of the promisee to secure

performance of the promised act for the benefit of another,

either as a gift or in satisfaction of an obligation to that

person, and the promisee makes a valid contract to do so,

then such third person has an enforceable right under that

contract to require the promisor to perform or respond in

damages.

13

In numerous instances, the Court has rejected privity-based limitations to

recovery, concluding that “in an action against a contractor for negligence which

actually results in property damage privity is no longer a prerequisite to suit.”

14 The

Court explained this conclusion in detail:

The defendant contractor’s liability is premised upon the

basic rule of negligence and is not dependent on the

existence of privity. The defendant, as any other individual,

has a duty to exercise ordinary care to guard against injury

which flows as a foreseeable consequence of an act. The

existence of a collateral contract...does not negate any

obligations to plaintiff imposed in tort.

15

Here, Plaintiff’s claims survive Pala’s Motion for Summary Judgment despite

a lack of privity. Delaware law permits Plaintiff to maintain the contract, warrant, and

tort claims against Pala. Further factual inquiry into the nature and language of the

subcontract between Regal and Pala is desirable in order to determine whether

Plaintiff has enforceable contract rights as a third party beneficiary. In addition, Pala

13

Id. (citations omitted). 

14 Travis v. Taralia, 1986 WL 4856, at *4 (Del. Super. Apr. 23, 1986).

15

Id. 

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Arroyo v. Regal Builders, LLC, et al. 

C.A. No.: K13C-12-028 RBY

September 20, 2016

may be liable to Plaintiff in tort for property damage alone. Therefore, Pala’s Motion

for Summary Judgment is DENIED. However, Plaintiff may not recover duplicate

contract and tort damages.

CONCLUSION

For the foregoing reasons, Defendant’s Motion is DENIED.

IT IS SO ORDERED.

/s/ Robert B. Young

J.

RBY/lmc

Via File & ServeXpress

oc: Prothonotary

cc: Counsel

Opinion Distribution

7