Court Opinion

ID: 4214273
Source: CourtListenerOpinion
Date Created: 2017-10-24 20:00:30.643219+00
Date Added: 2024-06-11T07:47:42.948083
License: Public Domain

NOT PRECEDENTIAL

                       UNITED STATES COURT OF APPEALS
                            FOR THE THIRD CIRCUIT
                                 ____________

                                       No. 16-3990
                                      ____________

                              PRECISION PIPELINE, LLC,

                                         Appellant

                                             v.

                     TRICO SURVEYING AND MAPPING, INC.;
                           G-A-I CONSULTANTS, INC.
                                  ____________

                     On Appeal from the United States District Court
                        for the Western District of Pennsylvania
                                      (2-13-cv-01823)
                      U.S. District Judge: Honorable Cathy Bissoon
                                       ____________

                   Submitted Pursuant to Third Circuit L.A.R. 34.1(a)
                                 September 12, 2017

             Before: VANASKIE, RENDELL and FISHER, Circuit Judges.

                                (Filed: October 24, 2017)
                                      ____________

                                        OPINION*
                                      ____________

FISHER, Circuit Judge.

       *
        This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7
does not constitute binding precedent.
       Precision Pipeline, LLC appeals the District Court’s grant of summary judgment

to Trico Surveying and Mapping, Inc. and G-A-I Consultants, Inc. We will affirm.

                                             I.

       Non-party Dominion Transmission, Inc., wanted to build a natural gas pipeline.

Dominion hired Trico to survey and map the pipeline route, and it hired G-A-I for

environmental consulting services. Dominion provided Trico’s drawings to contractors

bidding to build the pipeline. Precision was the successful bidder.

       The cost of building a pipeline is affected by the number of “foreign crossings,”

that is, existing utility lines and pipelines that must be crossed along the route. The

Dominion-Trico contract required Trico to note on its drawings the locations of above-

ground foreign crossings, plus underground foreign crossings that could be identified by

an above-ground flag or marker. The Dominion-G-A-I contract required G-A-I to add

information to Trico’s drawings, but not foreign crossing information.

       Knowing that the drawings did not identify all the foreign crossings, Precision said

to Dominion in the letter accompanying its bid: “We suspect there may be some quantity

of unknown pipelines to cross . . . . We propose that, should Precision be the successful

bidder, we negotiate a crossing price for unknown lines prior to the start of construction.”

However, Dominion and Precision did not do so, either before or after construction

began. Ultimately, Precision encountered 357 foreign crossings—far more than the 89

depicted on Trico’s drawings. This significantly increased Precision’s costs.

                                             2
         Precision sued Trico and G-A-I for negligent misrepresentation in preparing the

bid drawings. The District Court granted the defendants’ motions for summary judgment

and entered judgment in their favor.

                                             II.

         The District Court had diversity jurisdiction.1 We have jurisdiction over this

appeal because the order granting summary judgment was a final order.2 “We review a

district court’s grant of summary judgment de novo, applying the same standard as the

district court.”3 Viewing the facts in the light most favorable to the non-movant, we

affirm if there is no genuine issue of fact and the movant is entitled to judgment as a

matter of law.4

         All parties apply Pennsylvania law, as did the District Court. We do the same.

                                             III.

         The District Court concluded that the defendants did not owe Precision a duty

under Pennsylvania law, that Precision’s suit was untimely, and that no reasonable jury

could find that Precision justifiably relied on Trico’s drawings. Precision takes issue with

each of those rulings, but we need only reach the first.

         1
           28 U.S.C. § 1332(a).
         2
           28 U.S.C. § 1291.
         3
           S.H. ex rel. Durrell v. Lower Merion Sch. Dist., 729 F.3d 248, 256 (3d Cir.
2013).
         4
             Id.; Fed. R. Civ. P. 56.
                                              3
       Precision had no contractual relationship with Trico or G-A-I. It therefore sued

them under the theory articulated in Section 552 of the Restatement (Second) of Torts,

which the Pennsylvania Supreme Court adopted in Bilt-Rite Contractors, Inc. v. The

Architectural Studio.5 There, the tort of negligent misrepresentation was extended, in a

“narrowly tailored” fashion, to “businesses which provide services and/or information

that they know will be relied upon by third parties in their business endeavors.”6 The

parties agree that Trico’s and G-A-I’s contracts with Dominion did not require

identification of underground foreign crossings. Precision argues that nevertheless, the

defendants owed Precision, as a foreseeable user of the drawings, a duty to identify 85%

of above- and below-ground foreign crossings (which Precision says is the industry

standard). The key question here, then, is whether Trico and G-A-I owed Precision a duty

to identify 85% of the foreign crossings, even though their contracts with Dominion did

not require them to do so.

       The District Court analyzed the factors relevant to determining whether there is a

common law duty—including the nature of the risk, the foreseeability of the harm, and

the consequences of imposing liability—and determined that the defendants did not owe

Precision a duty under Bilt-Rite. Precision argues that by considering these factors, the

District Court erroneously supplanted Bilt-Rite’s duty analysis with its own. We disagree.

       5
        866 A.2d 270 (Pa. 2005).
       6
          Id. at 285 (“formally adopt[ing] Section 552 of the Restatement (Second) [of
Torts]”).
                                            4
       The District Court did not err when it analyzed the common law duty factors in

considering whether to extend Bilt-Rite to this situation—where the plaintiff seeks to

impose duties on the maker of the information that are different than the duties imposed

by the operative contract. Bilt-Rite itself establishes that Section 552 does not “supplant[]

the common law tort of negligent misrepresentation,” but instead “clarif[ies] the contours

of the tort as it applies to those in the business of providing information to others.”7

Indeed, Bilt-Rite examined the common law duty factors as part of its analysis supporting

the adoption of Section 552,8 and the District Court did not err by following the same

analytical path.

       Nor did the District Court err in concluding there was no duty. In Bilt-Rite, the

Pennsylvania Supreme Court held that a design professional (there, an architect) may, “in

the absence of privity of contract[,] . . . be sued by a general contractor . . . for economic

loss foreseeably resulting from breach of an architect’s common law duty of due care in

the performance of his contract with the owner.”9 Thus, the design professional’s liability

to the contractor arises from the design professional’s breach of its contract with the

owner. Even Precision’s authorities support this logical limit to Bilt-Rite’s narrowly

       7
        Id. at 287.
       8
        Id.
      9
        Id. at 286 (quoting and adopting reasoning of Davidson & Jones, Inc. v. County
of New Hanover, 255 S.E.2d 580, 584 (N.C. App. 1979)).
                                           5
tailored liability theory.10 Moreover, Precision cites no Pennsylvania case endorsing its

expansive view of Bilt-Rite, under which design professionals who sign a contract with a

property owner would thereby assume duties of unknown scope owed to third-party

contractors.

       Precision also argues that the District Court erred in ruling that its lawsuit was

barred by the statute of limitations, and in determining that there was no factual issue

regarding justifiable reliance. We need not reach those issues. Even if Precision were

correct, affirmance would still be required, because Precision’s liability theory under Bilt-

Rite is fundamentally flawed.

                                            IV.

       For the reasons set forth above, we will affirm.

       10
         For example, Precision cites an illustration in the Restatement where a city hires
an engineering firm to produce reports, the reports are relied on by contractors submitting
bids, and the engineering firm is liable to the contractors because it “negligently
prepare[d] and deliver[ed] to the City an inaccurate report, containing false and
misleading information.” Restatement (Second) of Torts § 552 (1977), illus. 9.
Negligently producing inaccurate, false, and misleading reports would of course breach
the engineering firm’s contract with the city.
                                              6