Chapter 18 - § 18.10 • NEGLIGENCE

• Jurisdiction: Colorado

§ 18.10 • NEGLIGENCE

§ 18.10.1-General Principles

Simply stated, "negligence is conduct which falls below the standard established by law for the protection of others against unreasonable risk of harm."¹⁷⁷ Imposing tort liability in those instances where one has acted unreasonably is in the best interests of society as a whole so as to safeguard certain other interests from harm.¹⁷⁸ The prima facie elements of a negligence claim are duty, breach, causation, and damages.¹⁷⁹ In the absence of a special relationship between the plaintiff and defendant, the defendant has no duty to take affirmative steps to prevent harm to the plaintiff.¹⁸⁰ A special relationship is created when a defendant voluntarily assumes a duty toward a plaintiff by affirmatively inducing reliance by creating a peril or by modifying the character of an existing risk.¹⁸¹ Thus, in the absence of a legal duty toward another, a party cannot be liable to them for negligence.

The nature and extent of a party's duty is typically measured by what is known as the standard of care. If a party's conduct falls below the applicable standard of care, that conduct was negligent. In the construction context, the standard of care is typically established through expert testimony. Experts frequently offer testimony as to whether a contractor's performance was acceptable.¹⁸² Similarly, with respect to design professionals, when one has been hired based on his or her special skill, he or she has the duty "to exercise the ordinary skill and competence of members of their profession, and a failure to discharge that duty will subject them to liability for negligence."¹⁸³ Thus, to establish what the "ordinary skill and competence of members of their profession" is, expert testimony is required.¹⁸⁴

In Colorado, a contractor or subcontractor has an obligation to perform in a "workmanlike man-ner."¹⁸⁵ If it fails to adhere to this standard, it is liable for the resulting damages.¹⁸⁶ This standard of care was first articulated as the implied warranty of workmanlike construction.¹⁸⁷ "For construction to be done in a good and workmanlike manner, there is no requirement of perfection; the test is reasonableness in terms of what the workmen of average skill and intelligence (the conscientious worker) would ordinarily do."¹⁸⁸ Thus, in the absence of a contrary standard of care set forth in the construction contract, a contractor's or subcontractor's proper performance will be determined by whether it performed in a workmanlike manner.

Where a construction contract required "'[a]ll work to be completed in a workmanlike manner according to standard practices,'" the court evaluated the contractor's performance using this standard, which was simply a contractual restatement of the common law requirement that it perform in a workmanlike manner.¹⁸⁹ Therefore, if the contract merely restates the common law standard of care, Colorado courts should have little difficulty in enforcing that standard. However, as "parties are free to alter their common law obligations by contract, provided their agreement does not contravene public policy or violate a statute," it is probable that Colorado would enforce a contractually-agreed-to standard of care.¹⁹⁰ Similarly, while no Colorado decision has addressed the validity of a provision in a construction contract that requires that the contractor perform to the sole satisfaction of the owner, as long as the owner acts in good faith, such a provision would probably be enforced.¹⁹¹

Even if a participant in the construction process has breached its standard of care and has therefore been negligent, that negligence does not create liability unless it caused the plaintiff's injuries.¹⁹² Proof of causation is inextricable from a claim of negligence, and a party is only entitled to recover those damages that naturally and probably resulted from another's negligence.¹⁹³ For instance, in Mosko v. Walton,¹⁹⁴ the plaintiffs were awarded damages for property damage allegedly caused by a leaking water pipe. The issue addressed on appeal was whether sufficient evidence existed in the record to prove the negligence of the defendants was a proximate cause of the damages.¹⁹⁵ It was "beyond dispute that water in the subsurface strata was responsible for the damage to plaintiffs' building."¹⁹⁶ The court nevertheless concluded that there was a lack of competent evidence to connect the leak with the damage to the property.¹⁹⁷ In reaching this conclusion the court noted that the record was replete with evidence of other sources of water accumulation in the area.¹⁹⁸

We can indeed sympathize with the difficulties of counsel in attempting to adduce sufficient proof to establish the causal connection in subsurface subsidence cases such as the one at bar. While we agree that the state of the record is sufficient to establish a possible connection between the leaking pipeline and the damage to plaintiffs' building, we cannot affirm a judgment based upon mere possibilities, conjecture or speculation.¹⁹⁹

Recognizing the necessity of a causal connection between the alleged negligence and the damages complained of, the court reiterated the longstanding rule that "proximate cause requires proof that but for the defendants' negligence the damage would not have occurred."²⁰⁰ Finally, "[w]here the evidence . . . presents no more than an equal choice of probabilities, it is not substantial. 'No number of mere possibilities will establish a probability.'"²⁰¹ Based upon the complexity of the construction process and the numerous participants involved, it is often difficult to establish causation. If causation can be proven, the claimant is entitled to all of those damages that naturally and probably flowed from the negligence.²⁰²

In construction disputes, the most frequently asserted negligence claims are by owners based upon allegedly faulty construction. Owners sometimes also assert negligence per se claims against contractors, usually without success. This section will discuss contractor negligence and negligence per se liability, as well as the economic loss rule, which continues to be viable in Colorado. Finally, it will address the application of strict product liability to construction disputes.

§ 18.10.2-Contractor Negligence

Where a contractor fails to properly perform pursuant to a construction contract, it generally should not be liable to the party with whom it contracts for negligence based upon the prohibition of the economic loss rule.²⁰³ Nevertheless, owners, more often than not, continue to assert negligence claims in tandem with breach of contract and other claims. While this is appropriate in certain limited instances,²⁰⁴ it is not in others. Sometimes, owners successfully assert only negligence and other claims in spite of existing contracts.²⁰⁵ In such cases, the attorneys involved are presumably either unaware of the economic loss rule or, for other strategic issues, do not assert it as a defense.²⁰⁶ In other instances, where no contractual relationship exists, a claim based on negligence and/or other tort may be the only potential avenue to recovery.²⁰⁷ Examples of each of the above situations will be discussed below.

In Consolidated Hardwoods, Inc. v. Alexander Concrete Construction, Inc.,²⁰⁸ the owner asserted a breach of contract claim, a negligence claim, and others against its contractor. Alexander had contracted with Consolidated to pour a concrete floor for its new warehouse.²⁰⁹ Shortly after the work was completed, the floor began to crack, which worsened over time.²¹⁰ Consolidated sued Alexander based on alleged breach of contract and negligence, and a jury determined that Alexander had breached its contract and was negligent.²¹¹ In affirming the verdict for both breach of contract and negligence, the court reviewed the parties' contract, which did not state that Alexander was required to compact the soil prior to placement of the concrete.²¹² However, once Alexander actually took steps to compact the soil, "it had a duty to perform the work in a reasonable manner."²¹³ Therefore, the court concluded that because the soil compaction was not required by the contract and because the faulty compaction caused property damage in the form of cracking of the slab, the plaintiff was not limited to contract damages and the economic loss rule did not apply.²¹⁴ Thus, if a contractor assumes extra-contractual duties and a breach of one of those duties causes damage, an owner is not precluded from proceeding against the contractor in both contract and tort. In fact, had the owner in Consolidated Hardwoods failed to assert a negligence claim against the contractor, it probably would not have been fully compensated for its damages since the damages awarded for the contractor's breach of the contract were nominal only.²¹⁵

Worthen Bank & Trust Co. v. Silvercool Service Co.²¹⁶ represents a case where an owner successfully sued a contractor for negligence and breach of implied warranties. In that case, the owner's negligence claim was predicated upon the contractor's defective installation of a roof on its building.²¹⁷ The court of appeals affirmed the judgment against the contractor and held that the trial court had properly awarded damages based upon the cost to replace the unusable roof.²¹⁸ A similar result was reached in Sanford v. Kobey Brothers Construction Corp.,²¹⁹ where a negligence judgment was affirmed against a contractor, which judgment arose out of damages caused by the contractor's failure to construct the required void space under the structural elements of the building.

A subsequent purchaser of a home can sue a contractor for negligence to recover damages caused by latent defects.²²⁰ This rule is based on the fact that it is foreseeable a home will be sold "and any structural defects are as certain to harm the subsequent purchaser as the first."²²¹ A latent or hidden defect is one that manifests itself after purchase and that is not...