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D.R. Horton, Inc. v. Builders FirstSource-Southeast Group, LLC

Court of Appeals of South Carolina

January 10, 2018

D.R. Horton, Inc. f/k/a C. Richard Dobson Builders, Inc., Appellant,
v.
Builders FirstSource - Southeast Group, LLC, and Builders FirstSource, Inc., and Joseph Naccari, Individually and d/b/a Master Framers, Defendants, Of whom Builders FirstSource - Southeast Group, LLC, and Builders FirstSource, Inc., are the Respondents. Joseph Naccari, Individually, and d/b/a Master Framers, Third-Party Plaintiff,
v.
Jaime Arreguin d/b/a Maya Construction, Third-Party Defendant. Appellate Case No. 2015-001238

          Heard April 18, 2017

         Appeal From Charleston County R. Markley Dennis, Jr., Circuit Court Judge

          Neil S. Haldrup of Wall Templeton & Haldrup, PA, and Peden Brown McLeod, Jr., McLeod Fraser & Cone, LLC, both of Charleston, for Appellant.

          James Taylor Anderson, III, of Taylor Anderson Law Firm, LLC, of Charleston, and Mary Bass Lohr, of Howell, Gibson & Hughes, PA, of Beaufort, for Respondents.

          OPINION

          LOCKEMY, C.J.

         D.R. Horton, Inc. (D.R. Horton) appeals the circuit court's order granting Builders FirstSource's (BFS) motion for summary judgment on D.R. Horton's claim for contractual indemnification and contribution. D.R. Horton argues on appeal the circuit court erred by 1) reading additional terms into the indemnification agreement, 2) finding it was equitably estopped from pursuing its contractual rights, 3) finding it was collaterally estopped from asserting its contractual rights, 4) finding the indemnification clause violated section 32-2-10 of the South Carolina Code (2007), and 5) finding that it did not sustain tort liability. We affirm.

         FACTS

         On February 5, 2001, D.R. Horton and BFS entered into a contract for BFS to construct several aspects of a home on Daniel Island. The contract included the following indemnification clause:

To the fullest extent permitted by law, contractor hereby agrees to protect, defend, indemnify, and hold owner, its parent corporation, subsidiaries and affiliates, and any of their respective officers, directors, partners, employees, agents and insurers, . . . free and harmless from and against any and all claims, demands, causes of actions, suits, or other litigation of every kind and character (including all costs thereof and attorneys' fees), . . . on account of bodily or personal injury, death, or damage to or loss of property, . . . in any way occurring, incident to, arising out of, or in connection with: (I) a breach of the warranties, representations, obligations, and covenants provided herein by contractor; (II) the work performed or to be performed by contractor or contractor's personnel, agents, suppliers, or permitted subcontractors; or (III) any negligent action and/or omission of the indemnitee related in any way to the work, even when the loss is caused by the fault or negligence of the indemnitee.

         The agreement also required "all notices required pursuant to this Agreement or otherwise shall be in writing."

         On June 12, 2008, Patricia Clark filed suit against D.R. Horton for damages resulting to her home after discovering alleged construction defects. In her complaint, Clark alleged D.R. Horton failed to properly install 1) the "siding and exterior wall system;" 2) "rough opening flashing and other flashing;" 3) a moisture barrier; 4) kick-out flashing; 5) framing; 6) the slab and driveway; 7) the roof and shingles; 8) and a gas hot water heater. Based on these allegations, Clark asserted claims against D.R. Horton for negligence, breach of contract, multiple breaches of warranty, and a violation of the South Carolina Unfair Trade Practices Act.

         On April 1, 2009, the circuit court referred Clark's claims to arbitration. After a two day arbitration on December 10 and 11, 2009, the arbitrator awarded Clark $150, 000. The arbitration award did not indicate what damages the arbitrator found compensable; rather, the award noted, "Counsel for the parties have requested an [o]rder containing a monetary award only."

         Subsequently, D.R. Horton filed a complaint seeking contractual indemnification and contribution from BFS for recovery of the arbitration award and attorney's fees D.R. Horton incurred defending the Clark action. D.R. Horton alleged BFS was responsible, "in whole or in part, " for the damages Clark suffered.

         BFS answered D.R. Horton's complaint and thereafter filed a motion for summary judgment alleging D.R. Horton's claims for contribution "fail because [D.R. Horton's] actions in arbitrating the [Clark action], and specifically requesting that the arbitrator not make findings of fact or conclusions of law, have rendered it impossible to ascertain" what damages D.R. Horton incurred as a result of BFS's actions. BFS asserted D.R. Horton's claims for contractual indemnity fail because the indemnity clause purports to require BFS to indemnify D.R. Horton for D.R. Horton's own negligence, and the lack of ...


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