Opinion ID: 2334707
Heading Depth: 2
Heading Rank: 2

Heading: Trumbull Summary Judgment

Text: In its summary judgment motion, Trumbull asserted that, as a construction manager, it owed no duty to Decedent, whose death resulted from allegedly negligent construction and maintenance of the haul road by NESL. In support, Trumbull observed that this Court in Leonard v. Commonwealth Dept. of Transp., 565 Pa. 101, 771 A.2d 1238, 1241-42 (2001), refused to impose liability where a general contractor did not exercise control over the worksite and the injured worker's employer assumed responsibility for safety compliance. Trumbull focused on this Court's reasoning that responsibility should lie with the party actually performing the work where that party has immediate knowledge of the potential hazards of the work. According to Trumbull, NESL, not Trumbull, assumed sole responsibility in its contract with PTC for the safety of NESL's employees on the site. Accordingly, it argued that it should not be held liable for the accident where it had no control over the construction or maintenance of the haul road or the decision to employ Decedent. Plaintiff responded that the Leonard line of cases was inapplicable because the question was not one of liability based on control over the worksite, but instead of liability for negligent performance of contractual duties. Plaintiff noted that Pennsylvania courts have imposed a legal duty, sometimes referred to as a social duty, on contracting parties to perform their contractual obligations so as not to injure third parties, citing Evans v. Otis Elevator Co., 403 Pa. 13, 168 A.2d 573 (1961). Under this caselaw, a plaintiff may bring a cause of action sounding in tort based upon a defendant's negligent performance of contractual obligations owed to another party. Plaintiff notes that the principal established in Otis Elevator has been formalized in Section 324A of the Restatement (Second) of Torts. [17] See Cantwell v. Allegheny County, 506 Pa. 35, 483 A.2d 1350 (1984). Plaintiff argued that Trumbull had assumed a duty of care to Decedent to perform its contractual obligations to provide safety oversight and inspection services in a manner that did not compromise the safety of the workers on the worksite. Plaintiff contended that Trumbull's failure to exercise reasonable care in performing the services owed under its contract with PTC resulted in Decedent's injury. In support, Plaintiff submitted an expert report suggesting that Trumbull failed to perform its contractual duties as construction manager in relation to the haul road. [18] Moreover, Plaintiff contended that Decedent relied upon the assertion in the safety videotape that safety inspectors, such as Trumbull, were looking after your interests as well as the owner's [interests]. In addressing Trumbull's motion for summary judgment, the trial court acknowledged Plaintiff's argument that Trumbull's duty arose from its contractual obligations, but, nevertheless, focused its analysis on whether Trumbull exercised control over the means and methods used by NESL to construct and maintain the haul roads. Applying the law relating to possessors of land discussed in relation to PTC's argument and this Court's decision in Leonard, the trial court found that the evidence showed that Trumbull did not exercise control over the means or method of NESL's work, and thus could not be held liable. Instead, it found that NESL had assumed sole responsibility for the safety of its workers in its contract with PTC. The court briefly addressed Plaintiff's argument for imposing a social duty to perform contractual obligations so as not to harm third parties. It distinguished the case relied upon by Plaintiff, see St. Clair v. B & L Paving Co., 270 Pa.Super. 277, 411 A.2d 525 (1979). The court concluded that the defendant in St. Clair had created an artificial condition of uneven pavement that led to the injury suffered by the third party, whereas Plaintiff merely alleged that Trumbull failed to inspect properly the condition created by NESL. The court dismissed this argument, concluding that the potential negligent conduct was that of NESL and was not connected to an alleged breach of Trumbull's contractual duty, without acknowledging the expert report submitted by Plaintiff. On appeal, the Commonwealth Court acknowledged that Trumbull asserted a lack of control over the allegedly negligent construction of the haul road, but found that Trumbull had a contractual duty to inspect and supervise the project, which included inspection of haul roads. The court concluded that negligent failure of its contractual obligation to inspect could trigger a duty to third parties such as Decedent sounding in tort. Cmwlth. Ct. Slip Op. at 5 (citing Evans v. Otis Elevator Co., 403 Pa. 13, 168 A.2d 573 (1961)). Moreover, it concluded that material questions of fact remained concerning whether Trumbull performed its duty adequately, given the testimony and the expert report's references to potential safety concerns regarding the haul road. [T]he Court determine[d] that Trumbull owed a duty to Decedent and that the trial court erred in holding otherwise. The extensive contractual commitments by Trumbull are rendered a nullity if it is held that Trumbull had no enforceable safety obligations. Cmwlth. Ct. Slip Op. at 11 (citation omitted). [19] On appeal to this Court, Trumbull seeks our determination of the scope of a construction manager's duty to employees of other contractors. Trumbull attempts to define the role and responsibilities of a construction manager by citation to the Construction Management Association's definition of construction management as the process of professional management applied to a construction program from conception to completion for the purpose of controlling time, costs, and quality. Defendants Brief at 17. Under its contract with PTC, Trumbull contends it was merely responsible for monitoring the contractors' compliance with their own safety plans. Indeed, Trumbull asserts, the safety plans submitted by NESL did not even mention haul roads. [20] Asserting that its role involved mere oversight, Trumbull argued for application of the law this Court has applied to possessors of land and general contractors out of possession of property. See Hader, 410 Pa. 139, 189 A.2d 271; Leonard, 565 Pa. 101, 771 A.2d 1238. It asserts that it did not control the means and methods of the activities related to the accident in this case, and thus, should not be liable for the resultant injury. Instead, Trumbull notes that NESL took full responsibility for any liability resulting from its work. Accordingly, Trumbull argues that it was entitled to summary judgment because it owed no duty to Decedent in regard to the safety of the haul roads or the decision to assign him the task that eventually led to his death. Trumbull rejects Plaintiff's attempt to impose liability based on its contractual responsibilities. Without directly addressing Otis Elevator, Trumbull argues that liability under Restatement Section 324A only applies to sins of commission. Additionally, Trumbull contends that Plaintiff did not satisfy any of the three triggering situations set forth in Section 324A (a-c) because she failed to demonstrate that (a) Trumbull's failure to exercise reasonable care increase[d] the risk of such harm; (b) Trumbull had undertaken to perform a duty owed by [PTC] to [Decedent] or (c) that the harm [was] suffered because of reliance of [PTC] or [Decedent] upon the undertaking. See RESTATEMENT (SECOND) OF TORTS § 324A. Trumbull asserts that negligent inspection cannot meet the requirements for a duty under Section 324A. Accordingly, Trumbull argues that summary judgment was appropriate because it did not owe Decedent a duty of care. In response, Plaintiff asserts that the precedent reflected in Leonard does not apply to the case at bar. In contrast to the situation addressed in Leonard, Plaintiff argues that this case does not involve an owner relinquishing control over the construction site or a general contractor releasing control over the means and method of the work. Instead, according to Plaintiff, this case involves the assumption of a contractual duty of inspection that was not and could not be delegated to the other contractors. Even though NESL assumed responsibility for the safety of its workers, that responsibility did not relieve Trumbull of its safety and monitoring obligations under the contract with PTC. According to Plaintiff, if Trumbull could delegate all safety responsibilities to the trade contractors, there would be little need for PTC to employ Trumbull to supervise the safety procedures. Instead, Plaintiff contends that a construction manager is subject to the same principles of duty as any other professional on a construction worksite. Relying on Otis Elevator, she maintains that the courts of this Commonwealth have imposed a social duty on contracting parties to act without negligence when it is foreseeable that third parties could be injured by the negligence. [21] She rejects Trumbull's argument that Section 324A only applies to sins of commission, noting that courts have applied a companion section, Section 323 with similar language, to sins of omission. See Hamil v. Bashline, 481 Pa. 256, 392 A.2d 1280 (1978). Plaintiff maintains that Trumbull's contractual responsibilities triggered a social duty to Decedent in this case. According to Plaintiff, Trumbull was responsible under its contract for ensuring that the various contractors complied with the safety plans that Trumbull had approved as compliant with the requirements set forth by PTC. Plaintiff finds that [i]t is inconceivable that Trumbull did not understand that its role was to assure the safety of the workers on the job, regardless of who employed them. Applying Section 324A(c), Plaintiff argues that Decedent reasonably relied upon the promise made in the videotape that Trumbull would look after the employees' interests as well as the owner's interest. She also asserts that reasonable minds could differ on the question of whether Trumbull's failure to correct the alleged flaws in the haul road contributed to or caused the accident. Plaintiff argues that the issue of whether Trumbull fully performed its obligations under the contract is an issue for the factfinder, and thus not appropriate for summary judgment. Nonetheless, she highlights the report of her expert who opined that Trumbull failed in the performance of [its] contractual duties in keeping with accepted industry practices . . . and failed to enforce basic safety practices by trying to limit [its] role to that of a reviewer instead of enforcing contractual and mandated safety regulations. Plaintiff's Brief at 24. We granted allowance of appeal in part to consider whether this Court could define the duty, if any, that construction managers owe to employees of other contractors. Initially, we reject Trumbull's attempt to graft the analysis used for general contractors and possessors of land onto construction managers. The Leonard and Hader lines of cases relate to situations where an employer reserves the right to supervise and inspect an independent contractor. These cases consider whether and to what extent the owner or general contractor has delegated responsibility for the work on the property to a subcontractor. In contrast, the case at bar does not involve the delegation of responsibility from Trumbull to NESL, but rather the assumption of responsibilities. Trumbull and NESL did not have a contractual relationship; instead, each had contractual obligations to PTC. While we acknowledge NESL's uncontested assumption of liability for injuries sustained by its employees, we cannot ignore Trumbull's positive assumption of responsibility to inspect and supervise the safety procedures on the work site. Finding the Hader and Leonard line of cases inapplicable, we next consider whether we can define generally the appropriate role and resultant duty of construction managers. While the parties assert that the position of construction manager is a relatively new position, this Court has considered the role before. In Malloy, this Court exempted construction managers from compliance with the competitive bidding process that is statutorily required for more typical construction services. Malloy, 540 Pa. 308, 657 A.2d 915, 920 (1995). We described the role of a construction manager as go[ing] directly to the overall success of the project to see that the contract is fully complied with as to the quantity and quality of material and workmanship and viewed the role of a construction manager to be more similar to that of an architect and other professional services for which quality of service is of paramount concern. While the holding of Malloy has little application to the question currently before us, it nonetheless is demonstrative of why we cannot create a defined duty for all construction managers. In summarizing the contractual duties of the construction manager in Malloy, Mr. Justice Castille thoroughly surveyed the contractual duties at two stages of the construction project, yet did not mention any obligation regarding safety inspectionsan obligation central to the issue in this case and fully addressed in the contract between PTC and Trumbull. See Malloy, 540 Pa. 308, 657 A.2d 915, 919-920 (1995). Similarly, our decision in Marshall v. Port Auth. of Allegheny County, 524 Pa. 1, 568 A.2d 931 (1990), [22] demonstrates the diversity among the contractual responsibilities of construction managers. In Marshall, an injured employee of the general contractor on a Port Authority construction project brought suit against the Port Authority and the engineering firm that provided construction management services. In finding that the engineering firm did not have a duty to protect the employee in that case, we scrutinized the language of various amendments to the contract between the engineering firm and the Port Authority. The majority concluded that the applicable amendment did not impose a duty to inspect the site and ensure the safety of the workers because the firm was responsible not for assuring compliance with safety procedures but with assur[ing] delivery of the specified systems and facilities in accordance with contract drawings and specifications. Id. at 936. We concluded that the firm was responsible for the end result, not safety procedures. Additionally, the majority recognized that other provisions of the contract relegated the firm's on-site safety role to passive duties such as the collection of written safety programs and reports rather than an active duty to inspect the jobsite. Id. at 937. The court noted that this was in contrast to a prior version of the contract that did provide for a more active role, requiring the firm to review contractors' practices and procedures to minimize hazards associated with construction operations. Id. at 9, 568 A.2d at 936. Accordingly, given the differences between Trumbull's contract in this case, the versions of the contracts in Marshall, and the contract in Malloy, we decline to provide a rigid definition of a construction manager or impose a correspondingly static duty on all construction managers. Instead, we find it preferable to allow owners and construction managers to define their roles and responsibilities in each contract according to the needs of each project and leaving courts to consider on a case by case basis whether such responsibilities trigger a duty to other workers on the jobsite. Pursuant to this holding, we must review the obligations Trumbull incurred in its contract with PTC and consider whether those obligations result in a duty to Decedent to perform the contractual obligations owed to PTC in a non-negligent manner. Unlike the passive responsibility evidenced in the applicable version of the contract in Marshall, Trumbull was paid to assume an active role in assuring safety on the worksite, agreeing to develop, implement, maintain and monitor a comprehensive project safety/insurance program. See Open End Inspection Agreement, supra, at 4 n. 4. Moreover, Trumbull asserted that it considered safety of paramount importance and, rather than suggesting a passive role in safety compliance, it agreed to interview applicants to be the contractors' safety representatives and monitor their performance and monitor the contractors' compliance with safety regulations on a frequent and regular schedule. See Technical Proposal, supra, at 4 n. 4. It would not be appropriate, however, for us to determine exactly what Trumbull was expected to do to comply with the responsibilities it assumed. Indeed, we believe the inquiry regarding what level of review and inspection the parties intended should be left to the factfinder who will have the opportunity to consider the testimony of the parties and the parties' experts. [23] Despite factual questions regarding the details of Trumbull's safety responsibilities, we may still consider whether the general safety obligations assumed in the contract could trigger a duty to others on the jobsite actionable in tort. It has long been the law of this Commonwealth that a contracting party may owe a duty, imposed by law and society, to perform its contractual obligations in such a manner as to avoid injury to third parties: Generally, a party to a contract does not become liable for a breach thereof to one who is not a party thereto. However, a party to a contract by the very nature of his contractual undertaking may place himself in such a position that the law will impose upon him a duty to perform his contractual undertaking in such manner that third personsstrangers to the contractwill not be injured thereby; Prosser, Torts (2nd ed.1955), § 85, pp. 514-519. It is not the contract per se which creates the duty; it is the law which imposes the duty because of the nature of the undertaking in the contract. Otis Elevator, 168 A.2d at 575. In Otis Elevator, we held that a company that contracted to inspect its customer's elevator could be liable in tort to an employee of the customer whose injury resulted from the company's negligent performance of its contractual obligation to inspect the elevators, regardless of any privity of contract. We concluded, If a person undertakes by contract to make periodic examinations and inspections of equipment, such as elevators, he should reasonably foresee that the normal and natural result of his failure to properly perform such undertaking might result in injury not only to the owner of the equipment but also to third persons, including the owner's employees. Id. at 575-76. We noted that the orbit of the duty is measured by the nature and scope of [the] contractual undertaking. Id. at 576. As noted by Plaintiff, the duty articulated in Otis Elevator has been formalized in Section 324A of the Restatement. In Cantwell v. Allegheny County, 506 Pa. 35, 483 A.2d 1350 (1984), this Court first applied Section 324A of the Restatement, noting that the essential provisions of this section have been the law in Pennsylvania for many years, citing Otis Elevator. Although this Court has not specifically applied the holding in Otis Elevator or Section 324A to construction managers, we have nonetheless considered the potential duties owed to a contractor's employees arising from a construction manager's contractual safety obligations. In Marshall, the majority declined to find that the engineering firm owed a duty to the general contractor's injured employee, but it did not rule out the possibility that a duty would have arisen under a prior version of the contract assigning the firm a more active role in worksite safety. Indeed, the dissenting justices in Marshall would have found a duty to protect third parties from negligent performance of the applicable contract in Marshall, despite the firm's passive safety duties. Accordingly, we reject Trumbull's suggestion that Section 324A cannot apply to negligent performance of a contractual inspection obligation because it would require this Court to overturn the longstanding precedent in Otis Elevator. Moreover, the plain language of Section 324A merely requires an undertaking to render services to another, which we find to encompass the rendering of inspection services. As in Otis Elevator, we conclude that it was foreseeable that a failure to perform properly the active safety role assumed by Trumbull under its contract with PTC could result in injuries to the workers on the site. Accordingly, we hold that Trumbull owed a duty to perform its safety obligations under its contract with PTC so as not to injure Decedent. The extent of the duty and the subsequent questions of breach and causation remain to be measured by the nature and scope of [the] contractual undertaking. Otis Elevator, at 576. Given the questions of fact discussed previously regarding the scope of Trumbull's contractual obligations, we must defer again to the factfinder to determine whether there was a breach of Trumbull's duty to perform the obligations in a manner that would not injure Decedent, whether the alleged breach was a substantial factor in causing Decedent's injuries, as well as any other appropriate inquiries which may arise as the case proceeds on remand. As these issues are obviously not appropriate for summary judgment, we affirm the decision of the Commonwealth Court reversing the trial court's grant of summary judgment to Trumbull, and remand to the trial court for further proceedings. As stated above, we reverse the Commonwealth Court as to PTC's motion for summary judgment and reinstate that portion of the trial court's order. Justice BAER delivered the Opinion of the Court. Chief Justice CAPPY, and Justice CASTILLE, SAYLOR, EAKIN and BAER and Justice BALDWIN join Part I. Justice NEWMAN, and Justice EAKIN and BAER and Justice BALDWIN join Part II.