Gatwood v. McGee

• Decision Date: 10 September 1985
• Docket Number: No. BD-307,BD-307
• Citation: 10 Fla. L. Weekly 2091,475 So.2d 720
• Parties: 10 Fla. L. Weekly 2091 Robert L. GATWOOD, Appellant, v. Paul McGEE and Linda McGee, Appellees. Case
• Court: Florida District Court of Appeals

Page 720

475 So.2d 720

10 Fla. L. Weekly 2091

Robert L. GATWOOD, Appellant, v. Paul McGEE and Linda McGee, Appellees.

Case No. BD-307.

District Court of Appeal of Florida First District.

Sept. 10, 1985.

William L. Lee of Shell, Fleming, Davis & Menge, Pensacola, for appellant.

James W. Middleton, Destin, for appellees.

NIMMONS, Judge.

Robert L. Gatwood appeals from a final judgment awarding damages in favor of the appellees/homeowners against Gatwood by reason of certain deficiencies in the construction of a home which was ultimately purchased by the appellees. We affirm.

Gatwood, a building contractor, was the president and sole stockholder of a home construction business known as Gatwood Enterprises, Inc. Gatwood Enterprises entered into an agreement with a builder named Glynquest whereby Glynquest was employed to manage and supervise the company's home building operation pursuant to which agreement Glynquest supervised the construction of a number of homes for Gatwood Enterprises. Gatwood himself, although involved in various aspects of the company's operations, had nothing to do with the actual construction or supervision of construction of the homes.

With respect to the subject home, Gatwood applied for a building permit to construct the home on a lot owned by Gatwood Enterprises. When the home was in the latter stages of completion in 1979, Glynquest departed. At the time of his departure, there were five or six other homes in various stages of completion. Due to financial difficulties, Gatwood Enterprises conveyed title to the subject home to Buster Reece. Reece and Gatwood were co-owners of another business, B&B Custom Builders, Inc. Reece completed the home with B&B Funds and sold it in October 1979 to appellees, Paul and Linda McGee. Within two months, the McGees became aware of structural problems with the home. It was subsequently determined that the home had been constructed on a bed of muck ten to twelve feet deep which had been covered with a layer of fill sand. The unstable ground was causing substantial problems to the southwest corner of the home.

The McGees filed suit in August 1980 against Gatwood (individually), Gatwood Enterprises, Inc. (a dissolved corporation--dissolved in June 1980), B&B Custom Builders, Inc. and Buster Reece, alleging negligence in the construction of the home. After a nonjury trial, the court entered judgment for damages against Gatwood Enterprises, Inc. and Gatwood, individually, in the sum of $11,500.00. The court, however, entered judgment in favor of defendants B&B Builders, Inc. and Buster Reece. Only Gatwood, individually, has appealed the judgment. No question has been raised regarding the propriety of the judgment against Gatwood Enterprises, Inc.

We would first note that there was competent substantial evidence that Glynquest knew or should have known that a portion of the subject home was being built over muck such that the building structure would likely sustain damage. Indeed, no contention is made that Glynquest was not negligent. Gatwood's principal argument is that it was error for the trial court to hold him individually liable, that any liability must be as to Glynquest or Gatwood Enterprises, Inc. He says it would be untenable "to hold the sole stockholder and qualifier of a contracting corporation liable for failure to supervise on one of the corporation's projects. ¹

Gatwood contends that a cause of action in negligence would not lie against him individually because there was no duty on his part to supervise construction. We disagree. Under Part I, Chapter 489, Florida Statutes (1979), the licensing and regulatory provisions governing construction contracting, the only way a company may be a contractor ² is by obtaining an individual licensed as a contractor as its qualifying agent. ³ Section 489.119, Florida Statutes (1979). Under Section 489.119, the applicant proposing to engage in contracting as a corporation or other business entity must apply through a qualifying agent. The application, among other things, must show that the qualifying agent is legally qualified to act for the business organization and that he has the authority to supervise construction undertaken by such organization. There is no dispute that Robert Gatwood was the certified qualifying agent for Gatwood Enterprises. It is also undisputed that Gatwood, as qualifying agent for his company, applied for and received the building permit to construct the subject home.

Gatwood says that he satisfied his statutorily-imposed duty as qualifying agent to supervise construction by hiring an apparently competent person to supervise the construction although such person was admittedly not certified under Chapter 489 as a qualifying agent for the company. Indeed, Gatwood makes much of the fact that he (Gatwood) never undertook to supervise construction and virtually never even visited the job site.

The statutory scheme provided for in Chapter 489 does not lend itself to such a narrow interpretation of Gatwood's duty of supervision as qualifying agent. In Alles v. Department of Professional Regulation, Construction Industry Licensing Board, 423 So.2d 624 (Fla. 5th DCA 1982), the Fifth District observed that it was the legislative intent that qualifying agents have the professional duty to supervise the construction projects entered into under their names. The Court went on to say:

The obvious purpose of these statutes allowing a company to act as a contractor through a licensed contractor is to insure that projects undertaken by a company are to be supervised by one certified and licensed by the board. To allow a contractor to be the "qualifying agent" for a company without placing any requirement on the contractor to exercise any supervision over the company's work done under his license would permit a contractor to loan or rent his license to the company. This would completely circumvent the legislative intent that an individual, certified as competent, be professionally responsible for supervising construction work on jobs requiring a licensed contractor.

Id. at 626. This court embraced the Alles decision in Hunt v. Department of Professional Regulation, Construction...