Court Reviews Whether a Quantum Meruit Award and the Denial of an Offset was proper in a case between a Construction Company and a Demolition Subcontractor

DILLARD CONSTRUCTION, INC. v. HAVRON CONTRACTING CORP. ET AL. (Tenn. Ct. App. November 23, 2010)

The only parties left litigating in what started out as a complex construction dispute are, on one side, Dillard Construction, Inc , and, on the other, Dillard's demolition subcontractor, Havron Contracting Corp. After a bench trial and several post-trial motions, the court held that:

(1) Dillard, while not having a contract with Havron, was required by quantum meruit to pay Havron $91,100 for work performed by Havron's subcontractors;
(2) Dillard was not entitled to an offset against that judgment for damage done to electrical equipment by Havron's subcontractor;
(3) Havron was entitled to recover from Dillard, under a "passthrough" indemnity theory, the attorney's fees awarded against Havron and in favor of its subcontractor; and
(4) Havron was not entitled to recover the attorney's fees that it, Havron, incurred in defending against the claims of its subcontractor.

Dillard appeals challenging both the quantum meruit award and the denial of an offset. Havron challenges the trial court's denial of indemnification for attorney's fees Havron incurred in defending the claims of its subcontractor. We affirm.

Opinion may be found at:
http://www.tba2.org/tba_files/TCA/2010/dillardconstruction_112310.pdf

Court reviews whether a contractor can prosecute a subcontractor's claim against TDOT on their behalf as a "pass-through" claim

KAY AND KAY CONTRACTING, LLC v. TENNESSEE DEPARTMENT OF TRANSPORTATION (Tenn. Ct. App. June 25, 2010)

Kay and Kay Contracting, LLC ("Contractor") entered into a contract with the Tennessee Department of Transportation ("TDOT") to build a bridge in Campbell County, Tennessee. Contractor subsequently entered into a subcontract with Whitley County Stone, LLC ("Subcontractor") to provide the excavation and grading work on the project. Subcontractor does not have a written contract with TDOT.

Both Contractor and Subcontractor filed claims with the Claims Commission alleging they were owed money by TDOT. Subcontractor was dismissed as a party because it did not have a written contract with TDOT, as required by Tenn. Code Ann. section 9-8-307(a)(1)(L). The Commissioner, however, determined that Contractor was allowed to prosecute Subcontractor's claim as a "pass-through" claim. The sole issue on this interlocutory appeal is whether Tenn. Code Ann. section 9-8-307(a)(1)(L) removes the State's sovereign immunity such that Contractor can assert a "pass-through" claim against TDOT on Subcontractor's behalf. We conclude that sovereign immunity from such a claim is not removed, and we reverse the judgment of the Claims Commission.

Opinion available at:
http://www.tba2.org/tba_files/TCA/2010/kayandkay_062510.pdf