Melchert v. Pro Elec. Contractors

• Decision Date: 07 April 2017
• Docket Number: No. 2013AP2882,2013AP2882
• Citation: 892 N.W.2d 710,374 Wis.2d 439
• Parties: Dr. Randall MELCHERT, Happy Hobby, Inc. and The Warren V. Jones and Joyce M. Jones Revocable Living Trust, Plaintiffs-Appellants-Petitioners, v. PRO ELECTRIC CONTRACTORS and Secura Insurance, A Mutual Company, Defendants-Respondents.
• Court: Wisconsin Supreme Court

374 Wis.2d 439

892 N.W.2d 710

Dr. Randall MELCHERT, Happy Hobby, Inc. and The Warren V. Jones and Joyce M. Jones Revocable Living Trust, Plaintiffs-Appellants-Petitioners,

v.PRO ELECTRIC CONTRACTORS and Secura Insurance, A Mutual Company, Defendants-Respondents.

No. 2013AP2882

Supreme Court of Wisconsin.

Oral Argument: November 9, 2016

Opinion Filed: April 7, 2017

For the plaintiff-appellants-petitioners, there was a brief by Rudolph J. Kuss, and Stevens & Kuss, S.C., Brookfield, and oral argument by Rudolph J. Kuss.

For the defendants-respondents, there was a brief by Amy M. Freiman, Rick E. Hills and Hills Legal Group, LTD, Waukesha, and oral argument by Amy M. Freiman.

MICHAEL J. GABLEMAN, J.

¶1 We review an unpublished decision of the court of appeals that affirmed the Waukesha County circuit court's¹ grant of summary judgment in favor of Pro Electric Contractors ("Pro Electric"), after Pro Electric was sued for negligence in connection with its work as a contractor on a government construction project. Melchert v. Pro Electric Contractors , No. 2013AP2882, unpublished slip op., 363 Wis.2d 654, 2015 WL 1034756 (Wis. Ct. App. Mar. 11, 2015).

¶2 Dr. Randall Melchert, Happy Hobby, Inc., and The Warren V. Jones and Joyce M. Jones Revocable Living Trust ("Petitioners") brought suit after Pro Electric severed a sewer lateral² during an excavation, because the broken lateral caused flooding damage to property that Petitioners owned and occupied. Pro Electric moved for summary judgment, asserting immunity as a governmental contractor pursuant to Wis. Stat. § 893.80(4).³ While Pro Electric admitted to severing the sewer lateral, it argued that the damage occurred because of construction design decisions made by the Wisconsin Department of Transportation ("DOT"), and that Pro Electric was merely implementing DOT's decisions. Following a hearing, the circuit court granted the motion and dismissed the case. The court of appeals affirmed.

¶3 This case requires us to address the extent to which governmental immunity protects a private contractor implementing a construction design chosen by a governmental entity. We hold that Pro Electric is immune from liability for severing the sewer lateral because it acted in accordance with reasonably precise design specifications adopted by a governmental entity in the exercise of its legislative, quasi-legislative, judicial, or quasi-judicial functions.

¶4 This case also requires us to interpret and apply certain provisions of the Digger's Hotline statute, codified at Wis. Stat. § 182.0175. Petitioners allege that Pro Electric caused their damages not only by severing the sewer lateral, but also by backfilling the excavation without inspecting the sewer lateral for damage and allowing repairs to be made, as required by § 182.0175(2)(am)6.-6m.⁴ Pro Electric is not immune from liability as to this second allegation, because DOT did not provide Pro Electric with reasonably precise specifications for inspecting sewer laterals for damage before backfilling pursuant to § 182.0175(2)(am)6.-6m. Ultimately, however, we affirm the circuit court's grant of summary judgment on the factual record before us. We do so because the undisputed material facts do not support a reasonable inference that Pro Electric failed to comply with its duties under § 182.0175(2)(am).

¶5 We begin with a brief factual background and description of the procedural history, and we next set forth the applicable principles of governmental contractor immunity. We apply these principles respectively to the two aspects of Pro Electric's conduct that allegedly caused Petitioners' damages: (1) Pro Electric's conduct in severing the sewer lateral, and (2) Pro Electric's conduct in backfilling the excavation without inspecting the sewer lateral for damage and allowing repairs to be made, pursuant to Wis. Stat. § 182.0175(2)(am). Finally, we perform the necessary analysis to determine whether Pro Electric is entitled to summary judgment.

I. FACTUAL BACKGROUND

¶6 We have set forth the facts that appear in the record and which the parties do not dispute. On July 25, 2011, DOT approved a plan for the improvement of a five-mile stretch of State Highway 190, also known as Capitol Drive, in Brookfield ("Project Plan"). The Project Plan spanned over 1,000 pages and contained specifications and detailed diagrams for the installation of new asphalt pavement, curbs, gutters, sidewalks, and traffic signals. Additionally, the DOT Highway Work Proposal for the project included over 100 pages of "Special Provisions" covering the various aspects of the project, including a section on requirements regarding underground utilities.⁵

¶7 Following the bidding process, DOT awarded the project to Payne & Dolan as the general contractor. On January 5, 2012, Payne & Dolan entered into a subcontractor agreement⁶ with Pro Electric to perform work on certain parts of the project, including the installation of traffic signals. For some of the traffic signals, the Project Plan directed Pro Electric to install new concrete bases to support the traffic signal poles.

¶8 This case concerns only the installation of the concrete base identified in the Project Plan as "SB2," located at the northeast corner of Capitol Drive and 128th Street and identified by specific coordinates in the Project Plan.⁷ The Project Plan directed Pro Electric to install a "Type 10" concrete base to support the traffic signal pole for SB2 and to use a circular auger to drill the hole in the ground for the base. The Project Plan specified that a Type 10 base required a hole that was 14 feet deep and 30 inches wide.

¶9 At least three days before Pro Electric started the excavation for SB2, Pro Electric contacted Digger's Hotline. The statute requires an excavator to contact Digger's Hotline at least three days before beginning any excavation.⁸ Wis. Stat. § 182.0175(2)(am)1. Under the statute, Digger's Hotline is then responsible for contacting the owners of transmission facilities⁹ in the area, and the owners are responsible for ensuring that such facilities are marked. § 182.0175(1)(d)6., (2m)(a)2.¹⁰ Pro Electric instructs its employees to inspect the area visually for these markings before beginning excavation.

¶10 Pro Electric's employees augered the hole for SB2 on August 22, 2012. Pro Electric used a circular auger attached to a truck at the end of a boom. Two of Pro Electric's employees performed the work: one was assigned to operate the auger from the truck and the other to monitor the auger and periodically clean it with a shovel. As Craig Clements, president of Pro Electric, stated in his affidavit, drilling a hole with a circular auger "creates a situation where the technician operating the auger has no ability to see into the hole which is being augered."

¶11 DOT retained an engineering firm, HNTB, to ensure Pro Electric's compliance with the Project Plan, and an HNTB engineer, Julie Keller, was onsite to supervise the augering work. The DOT Project Plan warned that "there may be other utility installations within the project which are not shown" on the diagram, but in anticipation of a contractor encountering such unexpected utility installations, it further provided that "the engineer may adjust the locations of items under this contract to avoid conflict with existing utility facilities." Keller neither instructed nor authorized Pro Electric to change the location of SB2.¹¹ Nothing in the record suggests that either Pro Electric or Keller was aware, or had any reason to be aware, of any utility facilities in the way of the excavation for SB2. Pro Electric proceeded to complete the Type 10 concrete base in accordance with the specifications set forth in the DOT Project Plan.

¶12 At some point after the project was completed, sewage backed up into an adjoining commercial property. The property was owned by The Warren V. Jones and Joyce M. Jones Revocable Living Trust and occupied by Dr. Randall Melchert and Happy Hobby, Inc., as tenants. It was subsequently discovered that the sewer backup occurred because an underground sewer lateral serving Petitioners' property ran directly through the location of SB2, such that Pro Electric had severed that lateral while constructing SB2. Nothing in the record suggests that either Pro Electric or HNTB was aware at the time of construction that Pro Electric had severed anything. The sewer lateral had been made of clay, and the surrounding soil was also clay, thus making it unlikely that indicia of the damage would have been apparent among the material the auger was bringing up.¹² Clements stated in his affidavit that "[n]o employee of Pro Electric ever reported to me, HNTB, or the general contractor that any sewer lateral was struck during the installation of SB2. All Pro Electric employees were instructed that any such incident would need to be reported immediately."

II. PROCEDURAL HISTORY

¶13 On March 1, 2013, Petitioners sued Pro Electric in the Waukesha County circuit court. Their complaint alleged that Pro Electric negligently severed the sewer lateral and then completed the project without repairing it. The complaint further alleged that, by doing so, Pro Electric thereby caused flooding and water damage to Petitioners' property, along with monetary losses, inconvenience, and other damages. In its answer, Pro Electric asserted immunity from suit as a governmental contractor. The court held a summary judgment hearing on Pro Electric's motion on November 18, 2013.

¶14 In an oral ruling following the hearing, the circuit court granted summary judgment in favor of Pro Electric, ruling that it was immune from liability. The court concluded that, "under any reasonable view of the evidence, DOT design choices regarding the location and the depth of the traffic light caused this accident here. Those relevant design choices were made by the government." The court did not consider whether the Digger's Hotline statute, Wis. Stat. § 182.0175, imposed additional...