Woodward-Gizienski & Associates v. Geotechnical Exploration, Inc.

• Decision Date: 27 February 1989
• Docket Number: No. D006799,WOODWARD-GIZIENSKI,D006799
• Citation: 208 Cal.App.3d 64,255 Cal.Rptr. 800
• Parties: & ASSOCIATES et al., Plaintiffs and Appellants, v. GEOTECHNICAL EXPLORATION, INC. et al., Defendants and Respondents.
• Court: California Court of Appeals Court of Appeals

Page 800

255 Cal.Rptr. 800

208 Cal.App.3d 64

WOODWARD-GIZIENSKI & ASSOCIATES et al., Plaintiffs and Appellants, v. GEOTECHNICAL EXPLORATION, INC. et al., Defendants and Respondents.

No. D006799.

Court of Appeal, Fourth District, Division 1, California.

Feb. 27, 1989.

McInnis, Fitzgerald, Rees, Sharkey & McIntyre, James E. Chodzko, James J. Reynolds, Gilson & Heaton, and Virginia R. Gilson, San Diego, for plaintiffs and appellants.

Asaro & Keagy, Richard R. Freeland and Arnold Neves, Jr., San Diego, for defendants and respondents.

WORK, Associate Justice.

This appeal from the judgment of dismissal following demurrer poses the issue of whether developers of a condominium project, sued by homeowners, can state an equitable indemnity and negligence cause of action against forensic soils engineers who allegedly caused homeowners to make excessive repairs to their subsidence-damaged property. We conclude that since as a matter of law the developers' liability is limited to the reasonable cost of repairing damage caused by their negligence, the developers' complaint does not state a viable cause of action. We affirm.

I FACTUAL AND PROCEDURAL BACKGROUND

The developers' complaint for full or partial equitable indemnity and negligence against the soils engineers hired by the homeowners alleges Costa Viva Homeowners Association (homeowners) sued Coast Savings & Loan Association and Service Development Corporation, developers of the homeowners' condominium project, for damages arising from the settlement of certain balconies, buildings and pools. Coast Savings & Loan Association and Service Development Corporation cross-complained against Woodward-Clyde Consultants and Woodward-Gizienski & Associates for indemnification as the project's soils engineers. ¹ The homeowners retained Geotechnical Exploration, Inc. (Geotechnical), a firm of soils engineers, to investigate and make recommendations to cure the defects and repair the damage. Geotechnical's recommendations included removing and replacing one swimming pool and constructing massive concrete and steel piers at 75 locations within the project. Relying on these recommendations, the homeowners implemented the repairs at a cost of about $1,000,000.

The developers settled with the homeowners for $731,400. In their memorandum of points and authorities opposing the demurrer, the developers explained that in their view even if a trier of fact concluded Geotechnical's repairs were unreasonable, it would not likely penalize innocent, elderly homeowners who had justifiably relied on Geotechnical. Thus, rather than risking a larger judgment, the developers chose to settle, reserving their rights to proceed against Geotechnical.

The developers allege Geotechnical breached its duty of professional care and was negligent in obtaining and relying on inadequate engineering information and failing to consider and recommend less expensive alternative repair measures. They maintain the repairs recommended by Geotechnical and made by the homeowners, without notice to the developers, were not reasonably necessary and were not predicated upon any reasonable engineering basis of fact, and the defects could have been cured for much less than the $1,000,000 paid by the homeowners or the $731,400 paid by the developers in the settlement. In oral argument to the trial court, the developers suggested the repairs could have been made for about $100,000.

II ANALYSIS

Equitable indemnification, allowing liability to be apportioned between wrongdoers based on their relative culpability, is premised on fairness. (Jaffe v. Huxley Architecture (1988) 200 Cal.App.3d 1188, 1191, 246 Cal.Rptr. 432; American Motorcycle Assn. v. Superior Court (1978) 20 Cal.3d 578, 607-608, 146 Cal.Rptr. 182, 578 P.2d 899.) The concern of the doctrine is to avoid the obvious unfairness which results when two negligent persons cause a loss, and one is required to bear the entire burden of the loss while the other is allowed to go "scot free." (Commercial Standard Title Co. v. Superior Court (1979) 92 Cal.App.3d 934, 939, 155 Cal.Rptr. 393.) The doctrine is not automatically available, however, for all tortfeasors who injure the same plaintiff; the courts evaluate the circumstances of the case to determine if its application is appropriate. (Munoz v. Davis (1983) 141 Cal.App.3d 420, 427, 190 Cal.Rptr. 400; Commercial Standard Title Co. v. Superior Court, supra, 92 Cal.App.3d at pp. 941-942, 155 Cal.Rptr. 393.)

Since indemnification between tortfeasors is an equitable tool created to correct potential injustice, we refused to apply it where a developer settled with a homeowners association for its defective workmanship and then sought indemnity from the association's directors for negligently permitting the defects to worsen through In Munoz v. Davis, supra, 141 Cal.App.3d at pages 426-427, 190 Cal.Rptr. 400, the court distinguished those subsequent tortfeasor cases in which the subsequent tortfeasor's activity is a normal aftermath of the defendant's conduct, from those instances where the later acts are only peripheral. There, the court rejected a lawyer's equitable indemnification action against a negligent driver who injured the lawyer's client. When the lawyer was sued for malpractice for permitting his client's statute of limitations to lapse, he sought indemnification from the negligent driver. After a comprehensive analysis of the equitable indemnity doctrine, the court held the lawyer and negligent driver were not jointly and severally liable to the injured plaintiff, and no right of indemnity existed. The client's loss of a right to sue for personal injuries was found to be totally distinct from those aggravations to the personal injuries themselves due to negligent performance of medical treatment required by the initial accident.

                lack of proper maintenance.  (Jaffe v. Huxley Architecture, supra, 200 Cal.App.3d at p. 1192, 246 Cal.Rptr. 432.)   In Jaffe, we held equitable indemnity was not appropriate where the relief sought could have been adjudicated in the association's action because the negligence of its directors is legally attributed to the association whose recovery from the developer would be subject to an offset for comparative negligence.  (See also Holland v. Thacher (1988) 199 Cal.App.3d 924, 929-930, 245 Cal.Rptr. 247.)
                

We recognize a prudent homeowner would seek to repair damages caused by a developer's defective soils compaction. Where those repairs are negligently performed by third parties so as to increase the injury to the property necessitating further repairs, the relationship between the two tortfeasors is the same as between the negligent driver and the negligent doctor in Blecker v. Wolbart (1985) 167 Cal.App.3d 1195, 1201-1203, 213 Cal.Rptr. 781, and the developer would retain the right to equitable indemnification. However, that is not our case.

When we examine the particular type of loss alleged here--i.e., excessive repairs--it...