Lindsay Mfg. Co. v. Universal Sur. Co.

• Decision Date: 29 July 1994
• Docket Number: S-91-704,Nos. S-91-703,s. S-91-703
• Citation: 246 Neb. 495,519 N.W.2d 530
• Parties: LINDSAY MANUFACTURING COMPANY, A Corporation, Appellant and Cross-Appellee, v. UNIVERSAL SURETY COMPANY, A Corporation, Appellee and Cross-Appellant. LINDSAY MANUFACTURING COMPANY, A Corporation, Appellant and Cross-Appellee, v. BRUCE GILMORE & ASSOCIATES, INC., Appellee and Cross-Appellee, and Christiansen Construction Company, A Corporation, and Layne-Western Company, Inc., Appellees and Cross-Appellants.
• Court: Nebraska Supreme Court

Page 530

519 N.W.2d 530

246 Neb. 495

LINDSAY MANUFACTURING COMPANY, A Corporation, Appellant and Cross-Appellee, v. UNIVERSAL SURETY COMPANY, A Corporation, Appellee and Cross-Appellant.

LINDSAY MANUFACTURING COMPANY, A Corporation, Appellant and Cross-Appellee, v. BRUCE GILMORE & ASSOCIATES, INC., Appellee and Cross-Appellee, and Christiansen Construction Company, A Corporation, and Layne-Western Company, Inc., Appellees and Cross-Appellants.

Nos. S-91-703, S-91-704.

Supreme Court of Nebraska.

July 29, 1994.

Syllabus by the Court

1. Summary Judgment: Appeal and Error. In appellate review of a summary judgment, the court views the evidence in a light most favorable to the party against whom the judgment is granted and gives such party the benefit of all reasonable inferences deducible from the evidence.

2. Summary Judgment. Summary judgment is to be granted only when the pleadings, depositions, admissions, stipulations, and affidavits in the record disclose that there is no genuine issue as to any material fact or as to the ultimate inferences that may be drawn from those facts and that the moving party is entitled to judgment as a matter of law.

3. Summary Judgment: Proof. A party moving for summary judgment has the burden to show that no genuine issue of material fact exists and must produce sufficient evidence to demonstrate that the moving party is entitled to judgment as a matter of law if the evidence presented for summary judgment remains uncontroverted. After the moving party has shown facts entitling it to a judgment as a matter of law, the opposing party has the burden to present evidence showing an issue of material fact which prevents judgment as a matter of law for the moving party.

4. Directed Verdict: Appeal and Error. With regard to the overruling of a motion for directed verdict made at the close of all the evidence, appellate review is controlled by the rule that a directed verdict is proper only where reasonable minds cannot differ and can only draw but one conclusion from the evidence, where an issue should be decided as a matter of law.

5. Directed Verdict. A trial court should direct a verdict as a matter of law only when the facts are conceded, undisputed, or such that reasonable minds can draw but one conclusion therefrom.

6. Directed Verdict. The party against whom the verdict is directed is entitled to have every controverted fact resolved in his or her favor and to have the benefit of every inference which can reasonably be drawn from the evidence. If there is any evidence which will sustain a finding for the party against whom the motion is made, the case may not be decided as a matter of law.

7. Judgments: Appeal and Error. As to questions of law, an appellate court has an obligation to reach a conclusion independent from a trial court's conclusion in a judgment under review.

8. Limitations of Actions: Appeal and Error. The point at which a statute of limitations begins to run must be determined from the facts of each case, and the decision 9. Limitations of Actions. Neb.Rev.Stat. § 25-222 (Reissue 1989) contains the limitations period applicable to an engineer rendering professional services.

of the district court on the issue of the statute of limitations normally will not be set aside by an appellate court unless clearly wrong.

10. Limitations of Actions: Negligence. Under the terms of Neb.Rev.Stat. § 25-222 (Reissue 1989), if an action is not to be considered time barred, the plaintiff must either file within 2 years of an alleged act or omission or show that its action falls within the exceptions of this section as to its discovery of the defendant's alleged negligence.

11. Limitations of Actions: Negligence. A cause of action accrues for negligence in professional services when the alleged act or omission in rendering or failure to render professional services takes place.

12. Limitations of Actions: Negligence. The continuous representation rule, which tolls the running of the statute of limitations, is inapplicable where the claimant discovers the alleged negligence prior to the termination of the professional relationship.

13. Limitations of Actions: Words and Phrases. "Discovery," in the context of statutes of limitations, refers to the fact that one knows of the existence of an injury and not that he has a legal right to seek redress.

14. Limitations of Actions. In the context of statutes of limitations, it is not necessary that a plaintiff have knowledge of the exact nature or source of the problem, but only that a problem existed.

15. Limitations of Actions: Negligence. The discovery exception to the statute of limitations is inapplicable if facts are discovered that constitute the basis of a cause of action within 2 years from the alleged act of negligence.

16. Construction Contracts: Contractors and Subcontractors: Liability. Where a contractor makes an absolute and unqualified contract to construct a building or perform a given undertaking, it is the general, and perhaps universal, rule that he assumes the risks attending the performance of the contract and must repair and make good any injury or defect which occurs or develops before the completed work has been delivered to the other party. But where he makes a contract to perform a given undertaking in accordance with prescribed plans and specifications, this rule does not apply. Under such a contract, he is not permitted to vary from the prescribed plans and specifications even if he deems them improper and insufficient; and therefore, he cannot be held to guarantee that work performed as required by them will be free from defects, withstand the action of the elements, or accomplish the purpose intended. Where the contract specifies what he is to do and the manner and method of doing it, and he does the work specified in the manner specified, his engagement is fulfilled, and he remains liable only for defects resulting from improper workmanship or other fault on his part.

17. Construction Contracts: Acceptance of Work: Waiver. An express or implied acceptance of work as in compliance with a building contract operates as a waiver of defective performance. However, this rule is inapplicable where the acceptance was under protest or induced by fraud, or where the defects were latent and unknown to the owner.

18. Negligence. The question of whether a legal duty exists for actionable negligence is a question of law dependent on the facts in a particular situation.

19. Negligence. For actionable negligence to exist, there must be a legal duty on the part of the defendant to protect the plaintiff from injury, a failure to discharge that duty, and damage proximately resulting from the undischarged duty.

20. Negligence: Words and Phrases. "Duty" is a question of whether the defendant is under any obligation for the benefit of the particular plaintiff, and in negligence cases, the duty is always the same--to conform to the legal standard of reasonable conduct in light of the apparent risk.

21. Negligence: Words and Phrases. A duty, in negligence cases, may be defined as an obligation, to which the law will give recognition and effect, to conform to a particular standard of conduct toward another.

22. Contractors and Subcontractors. In the absence of a binding agreement, express or implied, there is no privity of contract between a subcontractor and a landowner who employs the general contractor who hired the subcontractor.

23. Construction Contracts: Parties: Negligence. One not a party to a construction contract cannot, for injuries received after the acceptance of the completed work by the contractee, maintain an action in tort for the negligent performance of the contract.

24. Contractors and Subcontractors. An independent contractor owes no duty to third persons to judge the plans, specifications, or instructions which he has merely contracted to follow unless they are so obviously dangerous that no competent contractor would follow them.

Ronald F. Krause and Michael K. Huffer, of Cassem, Tierney, Adams, Gotch & Douglas, Omaha, for appellant.

Thomas J. Walsh, Sr., of Walsh, Fullenkamp & Doyle, Omaha, for appellees Universal Sur. Co. and Christiansen Const. Co.

Larry E. Welch and Christopher J. Tjaden, of Gross & Welch, P.C., Omaha, for appellee Bruce Gilmore & Associates, Inc.

Waldine H. Olson and K.C. Engdahl, of Schmid, Mooney & Frederick, P.C., Omaha, for appellee Layne-Western Co.

HASTINGS, C.J., BOSLAUGH, CAPORALE, FAHRNBRUCH, and LANPHIER, JJ., and GRANT, J., Retired.

LANPHIER, Justice.

Lindsay Manufacturing Company (Lindsay) appeals the judgment of the district court for Platte County following a jury trial. Lindsay sought to recover costs incurred by it in remediating contamination of an aquifer underlying Lindsay's manufacturing plant. Lindsay claimed the contamination resulted from the improper construction of a new acid waste treatment facility (facility). Each defendant received judgment in its favor. Causes of action against Bruce Gilmore & Associates, Inc. (Gilmore), the engineering firm hired by Lindsay to design and oversee the construction of the facility, were dismissed by the district court as time barred by the statute of limitations. Although Lindsay asserted multiple causes of action against Christiansen Construction Company (Christiansen), the contractor hired by Lindsay to build the facility, the only action to reach the jury was breach of contract. Likewise, the only action to survive against Layne-Western Company, Inc. (Layne-Western), the subcontractor who dug the monitoring wells which are the subject of this litigation, was an action for negligence. The district court properly determined that the actions against Gilmore were time barred. Although the district court erred in failing to grant Christiansen's and Layne-Western's motions for directed verdict at the close of all evidence, the judgment of the district court rendered in favor of...