Opinion ID: 1330381
Heading Depth: 1
Heading Rank: 4

Heading: completion and acceptance

Text: Dorrell argues that the completion and acceptance defense was not a valid legal basis for granting summary judgment. We agree. Historically, this Court has found that a contractor is not liable to third parties who have been injured as a result of negligent construction after the work has been completed and accepted by the other party to the contract or the owner. Clyde v. Sumerel, 233 S.C. 228, 232-33, 104 S.E.2d 392, 393 (1958); see also Nichols v. Craven, 224 S.C. 244, 78 S.E.2d 376 (1953) (holding that a paving company was not liable for failing to place appropriate signs and barricades at construction site once the paving company's work was completed and accepted and the highway department regained sole responsibility for traffic flow). Under this basic rule of tort law, which is commonly referred to as the completed and accepted rule or acceptance rule, a contractor's liability ceases upon a showing that the completed work has been practically, not necessarily formally, accepted. Id. But as early as 1968, the completion and acceptance defense began to fall out of favor in South Carolina. In Rogers v. Scyphers , this Court refused to allow a building contractor to use the defense to avoid liability for an injury caused when the plaintiff fell on a negligently constructed stairway. 251 S.C. at 133, 161 S.E.2d at 84. The Court stated: the entire weight of modern authority is to the effect that building contractors ... are liable for injuries to, or the death of, third persons occurring after the completion of the work and acceptance by the owner, where the work is reasonably certain to endanger third persons if negligently prepared or constructed. 251 S.C. at 132, 161 S.E.2d at 83. Moreover, the Court noted that we see no rational difference between the duty owed by the manufacturer of a chattel and the duty owed by the builder-vendor of a new structure. Id. at 134, 161 S.E.2d at 84. Accordingly, there was a duty on the defendants as builders to use reasonable care in the construction of the home to avoid unreasonable risk and danger to those who would normally occupy it.... Id. Therefore, the Court held that the defendants' motion to dismiss was properly overruled. [3] Id. at 137, 161 S.E.2d at 85. Later, in 1975, this Court affirmed judgment for a person injured from falling into a six-foot-deep hole left by a contractor for the telephone company, who had removed a telephone pole earlier that day. Smith v. Fitton and Pittman, Inc., 264 S.C. 129, 133, 212 S.E.2d 925, 926 (1975). Because the contractor had a duty of care to leave the premises in a safe condition, the Court held that the issue of negligence was properly submitted to the jury. Id. After affirming judgment for the injured plaintiff, the Court addressed the issue of whether the contractor could be relieved of liability based on the theory that the work had been completed and accepted. The Court explained that [t]o the extent that this doctrine has not been eroded by Rogers, it is still viable. Id. at 134, 212 S.E.2d at 926; see also Henderson v. St. Francis Community Hosp., 295 S.C. 441, 369 S.E.2d 652 (Ct.App.1988), reversed on other grounds, 303 S.C. 177, 399 S.E.2d 767 (1990) (holding that the designer of a parking lot was not liable to a plaintiff who fell on a sweetgum ball in the lot, given that the lot was designed sixteen years before the fall and the defects were neither latent nor concealed). Though viable, the Court found that the doctrine was not available as a defense in this case because the person who accepted the work did not have the actual or apparent authority to do so. Id. Apparently the contractors had planned to refill the hole, but an employee from the business occupying the property told the contractors to straddle the hole with the removed pole instead. The Court found the employee's instruction did not constitute acceptance, and the telephone company, as the contracting party, was the appropriate person to accept the completed work. Therefore, the doctrine did not relieve the contractor of liability. Id. at 134, 212 S.E.2d at 927. Although Smith suggested that the completion and acceptance doctrine, though eroded, remained viable, South Carolina courts have continued to limit its application. For example, the South Carolina Court of Appeals has explicitly refused to apply the doctrine in products liability cases, finding that the application of the doctrine would undermine the whole concept of products liability. Stanley v. Montague Co., Inc., 299 S.C. 51, 54, 382 S.E.2d 246, 248 (Ct.App.1989). In addition to finding that the doctrine did not apply in the products context, the court in Stanley addressed the doctrine's overall demise. The court noted that [p]rinciples governing the liability of contractors for injuries to third parties have followed principles governing the liability of manufacturers for injuries to persons not in privity with the manufacturers. Id. at 52, 382 S.E.2d at 247. In fact, the court read Rogers v. Scyphers as a case that specifically repudiated the doctrine. Id. at 55, 382 S.E.2d at 248. Consequently, the Stanley court concluded, the defense of completion and acceptance, like the defense of lack of privity, has fallen into disfavor in South Carolina. Id. at 56, 382 S.E.2d at 249. South Carolina has not been alone in disfavoring the completion and acceptance doctrine. As late as the 1950s, the majority of jurisdictions adhered to the completed and accepted rule. Since then, the completed and accepted rule has been severely criticized and repudiated in most states and is now the minority rule while the modern rule has become the majority rule. Emmanuel S. Tipon, Modern Status of Rules Regarding Tort Liability of Building or Construction Contractor for Injury or Damage to Third Person Occurring After Completion and Acceptance of Work; Foreseeability or Modern Rule, 75 A.L.R.5th 413, 437 (2000). [4] The modern rule, or foreseeability doctrine, may be stated in the following way: A building or construction contractor is liable for injury or damage to a third person even after completion of the work and its acceptance by the owner where it was reasonably foreseeable that a third person would be injured by such work on account of the contractor's negligence or failure to disclose a dangerous condition known to such contractor. Id. at 436. The rule has been applied in multiple contexts, including cases involving the construction of streets and highways. Id. at 534-35; see also Louk v. Isuzu Motors, Inc., 198 W.Va. 250, 479 S.E.2d 911, 921 (1996) (a highway engineer may be held liable for negligence even after the highway plan or design has been accepted and the highway constructed according to the plan); McFadden v. Ten-T Corp., 529 So.2d 192, 200 (Ala.1988) (paving contractor may be liable for creating a hazardous condition during resurfacing and widening of highway several months after project completed and accepted by highway department); Johnson v. Oman Constr. Co., Inc., 519 S.W.2d 782, 788 (Tenn.1975) (an independent contractor who left a barricade  which was not striped, painted, or illuminated  on a highway may be held liable for negligence even after project completed and accepted). The modern view, rejecting the completion and acceptance doctrine, is reflected in the Restatement (Second) of Torts as well: One who on behalf of the possessor of land erects a structure or creates any other condition thereon is subject to liability to others upon or outside of the land for physical harm caused to them by the dangerous character of the structure or condition after his work has been accepted by the possessor, under the same rules as those determining the liability of one who as manufacturer or independent contractor makes a chattel for the use of others. Restatement (Second) of Torts, § 385 (1965). South Carolina cases that have considered and rejected the application of the completion and acceptance doctrine have incorporated foreseeability of harm in the analysis. For example, in Smith v. Fitton , the Court explained that given the location of the six-foot-deep hole left by the contractor who removed the telephone pole, it was certainly inferable that this area would be traversed by invitees as well as the owner. 264 S.C. at 133, 212 S.E.2d at 926. Additionally, in Rogers v. Scyphers , the Court stated that contractors are liable, even after completion and acceptance of the work, where the work is reasonably certain to endanger third persons if negligently prepared or constructed. 251 S.C. at 132, 161 S.E.2d at 83; see also Prosser and Keeton on Torts § 104A, 723 (5th ed. 1984) (citing Rogers v. Scyphers and stating [i]t is now the almost universal rule that the contractor is liable to all those who may foreseeably be injured by the structure, not only when he fails to disclose dangerous conditions known to him, but also when the work is negligently done.). We join the majority of jurisdictions in deciding that a contractor's duty of care is not extinguished upon the completion and acceptance of the contractor's work. Liability should be governed by the same principles that govern ordinary negligence actions, and we see no reason why paving contractors should be treated differently from building contractors and product manufacturers. Therefore, in light of Rogers and its progeny, the completion and acceptance defense was an improper legal basis upon which to grant summary judgment. APAC cannot escape liability simply by completing its work and having it accepted by SCDOT. APAC had a duty of care that extended above and beyond compliance with the contract, and whether APAC breached that duty of care is a question of fact that must be decided by a jury. Moreover, it is for a jury to decide whether Dorrell's injury was foreseeable. Therefore, the trial court's decision granting summary judgment is reversed.