St. Paul Fire & Marine Insurance v. Wittman Mechanical Contractors, Inc. ( 2008 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 06-2031
ST. PAUL FIRE & MARINE INSURANCE COMPANY, as
subrogee of A.G. Van Metre Services,
Incorporated,
Plaintiff - Appellee,
versus
WITTMAN MECHANICAL CONTRACTORS, INCORPORATED,
Defendant - Appellant,
and
MID-SOUTH BUILDING SUPPLY COMPANY, INCORPORATED;
DAE SOP YOON,
Defendants.
Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. Walter D. Kelley, Jr.,
District Judge. (1:04-cv-01303-WDK)
Argued: November 1, 2007 Decided: February 6, 2008
Before NIEMEYER, MICHAEL, and MOTZ, Circuit Judges.
Vacated and remanded with instructions by unpublished per curiam
opinion.
Francis Joseph Prior, Jr., SICILIANO, ELLIS, DYER & BOCCAROSSE,
Fairfax, Virginia, for Appellant. Jim H. Fields, Jr., COZEN
O’CONNOR, Philadelphia, Pennsylvania, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
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PER CURIAM:
On the morning of January 12, 2004, Wittman Mechanical
Contractors, Inc., the mechanical subcontractor on a new house
under construction in Loudoun County, Virginia, activated a
propane gas line feeding the gas system in the house and turned on
the furnace. Approximately one hour later, an explosion occurred,
destroying the house. Experts concluded that the explosion
resulted from a gas leak at the connection between the main gas
pipeline in the basement and the spur gas pipeline running up to
the kitchen island cooktop on the first floor.
Under the “scope of work” provision in the contract between
Wittman Mechanical and the general contractor, Wittman Mechanical
was responsible for installing and starting up the furnace, but it
was not responsible for installing the gas pipeline system or
testing it for leaks before the system was activated.
Nonetheless, Wittman Mechanical activated the gas pipeline system
at the request of the general contractor and, before activating
the system, did not test for leaks in the system.
The general contractor’s insurance company, St. Paul Fire &
Marine Insurance Company (“St. Paul Insurance”) paid the loss and
then commenced this subrogation action against Wittman Mechanical,
alleging breach of warranty and negligence in activating the gas
system and starting the furnace without testing for leaks.
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Following a three-day trial, a jury found in favor of Wittman
Mechanical on both claims. The district court, however, granted
St. Paul Insurance’s post-trial motion for judgment
notwithstanding the verdict, concluding that Wittman Mechanical
breached its express warranties by failing to perform a pressure
test for leaks. The court thus entered judgment in favor of St.
Paul Insurance for $445,685, plus interest.
We conclude on appeal that based on the “scope of work”
clause in the subcontract between Wittman Mechanical and the
general contractor, Wittman Mechanical was responsible only for a
breach of warranty given in connection with installation of the
furnace, which required Wittman Mechanical to perform a soap-and-
water test* at the connection between the furnace and the gas line
system, but not a pressure test on the entire gas pipeline system,
which was required only of the contractor doing the gas pipeline
work. Accordingly, we conclude that the jury could have
concluded, based on the evidence at trial, that any failure by
Wittman Mechanical to perform a soap-and-water test was not the
cause of the explosion. We therefore vacate the judgment and
remand to the district court with instructions to reinstate the
verdict and enter judgment for Wittman Mechanical.
*
A soap-and-water leak test is the familiar test used, for
example, in checking bicycle tires for leaks. Soap and water is
put on a suspected leak, and if bubbles occur, they indicate the
site of a leak.
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I
Wittman Mechanical was hired by Virginia Residential
Construction, Inc., as a subcontractor to provide heating,
ventilation, and air conditioning services to houses under
construction in Loudoun County, including the house in question.
Virginia Residential was a residential real estate developer in
the Washington, D.C. metropolitan area and was the owner of and
contractor for the house in question. The contract between
Wittman Mechanical and Virginia Residential included a “scope of
work” provision that required Wittman Mechanical to perform only
the HVAC work, including the installation and starting of the
furnace. But the contract did not include within the scope of the
work any work related to installation and testing of the gas
pipeline system. The contract provided that all gas pipeline work
was to be performed by Peed Piping, another subcontractor retained
by Virginia Residential.
After Peed Piping had initially installed the gas pipes in
the house, Loudoun County inspectors performed an inspection of
the pipes. This inspection required that all gas pipes in the
house first be tied to an appliance, be capped off, or have a shut
off valve. The county inspectors performed a pressure test to
detect any leaks in the system by injecting a specified amount of
air pressure into the pipes. Because the pipes held the pressure
for 24 hours, the house’s system passed inspection and was
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approved in October 2003. Approximately three months passed,
during which a spur gas line running from the main gas pipeline in
the house’s basement to the island cooktop in the kitchen became
disconnected. It was at this connection between the main gas
pipeline and the spur line from which gas leaked, causing the
explosion on January 12, 2004.
On the morning of January 12, 2004, Robert Casteel and Lloyd
Henry Dignazio, employees of Wittman Mechanical, arrived at the
house to install brackets for air conditioning units. At some
point during the morning, Virginia Residential’s superintendent at
the site, Russell Rolle, asked Casteel to start the furnace for
warmth. By that time, Wittman Mechanical had already installed
the furnace but had not started it up. After receiving permission
from his supervisors at Wittman Mechanical, Casteel opened the
line at the furnace to bleed out air that could prevent the
furnace from starting. On doing this, he felt no pressure and
smelled no gas, indicating to him that the line from the propane
tank had not yet been activated. When Casteel advised Rolle of
this fact, Rolle asked Casteel to activate the gas line leading
from the propane tank to the house. This task, however, was one
that did not fall within the scope of work for Wittman Mechanical.
Nonetheless, feeling pressure from Rolle, Casteel called Wittman
Mechanical’s main office and asked permission to activate the
line. Wittman Mechanical’s operations manager authorized Casteel
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to activate the line once he was informed that Rolle had assured
Casteel that the gas pipeline system was ready to receive propane
gas. Wittman Mechanical’s operations manager testified at trial
that he had assumed that, based on Rolle’s request to activate the
system and his assurance that the system was in good condition and
ready to receive propane gas, Rolle was accepting responsibility
for any adverse consequences that might arise from the activation
of the system.
After conducting a visual inspection of the gas appliances in
the house to confirm that the gas line valves were set in the off
position, Casteel activated the propane gas line and started the
furnace in the basement. In starting the furnace, Casteel did not
perform any type of leak test, nor did he consult the
manufacturer’s instruction manual that came with the furnace
itself, testifying that he had never done so. He also testified
that he was not aware of any codes or industry standards that he
was required to follow before or after turning on the gas and
starting the furnace.
The explosion occurred approximately one hour after Casteel
activated the gas line and started the furnace.
Following the explosion, St. Paul Insurance, who was the
insurer of Virginia Residential, paid Virginia Residential’s
insurance claim and commenced this subrogation action against
Wittman Mechanical for breach of warranty and negligence. After
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the jury returned a verdict in favor of Wittman Mechanical on both
claims, St. Paul Insurance moved for a judgment under Federal Rule
of Civil Procedure 50, and the district court granted the motion,
awarding St. Paul Insurance $445,685, with interest at 9 percent
from January 12, 2004.
Wittman Mechanical filed this appeal.
II
A trial court may direct judgment as a matter of law only
when there is no legally sufficient evidentiary basis for a
reasonable jury to find in favor of the non-moving party. Fed. R.
Civ. P. 50(a)(1); Babcock v. Bell South Advertising & Publishing
Corp., 348 F.3d 73, 76 (4th Cir. 2003). In considering to grant
a motion as a matter of law, notwithstanding the verdict, the
court must view the evidence in the light most favorable to the
non-moving party and draw all reasonable inferences in that
party’s favor without weighing the evidence or considering the
witnesses’ credibility. Baynard v. Malone, 268 F.3d 228, 234-35
(4th Cir. 2001). Stated otherwise, judgment as a matter of law
can be granted only if the evidence “supports only one reasonable
conclusion as to the verdict” under the governing law. Bank of
Montreal v. Signet Bank, 193 F.3d 818, 831 (4th Cir. 1999).
Our review of a district court’s grant of a Rule 50 motion
applies the same standards de novo. Brown v. CSX Transportation,
Inc., 18 F.3d 245, 248 (4th Cir. 1994).
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In this case, the district court found as a matter of law
that Wittman Mechanical breached its express warranty when it
failed to conduct a leak test before or after starting the
furnace. The court properly recognized that Wittman Mechanical
could not have breached any warranty with regard to activating the
gas pipeline system, because “the contract between [Virginia
Residential] and Wittman Mechanical does not unambiguously cover
propane gas piping and installation.”
To find that Wittman Mechanical breached its warranties in
connection with starting the furnace, the district court relied on
the contract between Virginia Residential and Wittman Mechanical,
in which Wittman Mechanical warranted its qualifications to
perform the “Work,” as defined in the contract; warranted it was
familiar with and had sufficient knowledge of the “Work”; and
warranted that its “Work” would be performed free of defects and
in accordance with sound engineering standards, as well as
standards of the industry.
The court also relied on the furnace manufacturer’s
installation manual, which directed that the installer “pressure
test” the “piping system”; inspect the “entire [piping] system”
before turning on the gas; and test “the piping system” for
leakage after gas is “turned on into” the system. In connection
with the particular task of installing the furnace, the furnace
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manual provided a warning pertaining to “furnace start-up
procedures” as follows:
Never purge a gas line into a combustion chamber. Never
use matches, candles, flame or other sources of ignition
for the purpose of checking leakage. Use a soap-and-
water solution to check for leakage. Failure to follow
this warning can cause fire, explosion, personal injury,
or death.
(Emphasis added).
The court concluded that “Wittman Mechanical breached the
express warranties contained in the contract [with Virginia
Residential] by failing to follow the practices and standards
referenced in the contract and specified in the [furnace]
installation manual and the National Fuel Gas Code.” It concluded
that “[h]ad Wittman Mechanical’s workmen followed these practices
-- specifically, conducting a leak test -- they would have
discovered the leak and thus have avoided the explosion.”
It is undisputed in this case that Wittman Mechanical did not
conduct any leak test. Nonetheless, a question still remains
whether its failure to conduct the appropriate leak test
conclusively caused the explosion. The jury obviously found that
Wittman Mechanical’s failure to perform a leak test did not cause
the loss, and it returned a verdict in favor of Wittman
Mechanical. We find that the jury’s verdict was reasonable and
was supported by substantial evidence.
The duties contained in the furnace installation manual, as
outlined by the district court, implied that the furnace
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installation subcontractor was also the subcontractor installing
the “gas pipe system” and therefore was responsible for testing
and turning on the gas pipeline system. But, of course, in this
case, as the district court appropriately recognized, the
responsibilities were divided between Wittman Mechanical and Peed
Piping. The “scope of work” assigned the responsibility of
installing, testing, and activating the gas pipeline system to
Peed Piping, and it assigned the responsibility of installing,
testing, and starting up the furnace to Wittman Mechanical. When
reading the furnace installation manual in the light of these
divided responsibilities, it becomes apparent that the furnace
manual required the furnace installer to do only a soap-and-water
leak test at the furnace’s connection with the gas pipe system,
specifically warning the furnace installer not to conduct a
pressure test. The pressure test was reserved for testing the
entire system.
Reading from the furnace manual, which includes instructions
relating to installation of the gas pipeline system as well as
installation of the furnace, it states first with respect to the
pipeline system:
Piping should be pressure and leak tested in accordance
with [the National Fuel Gas Code] . . . local, and
national plumbing and gas codes before the furnace has
been connected.
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(Emphasis added). But it states that after the furnace has been
connected, the installer should perform a soap-and-water test
where the furnace connects with the pipeline system:
Never purge a gas line into a combustion chamber. Never
test for gas leaks with an open flame. Use a
commercially available soap solution made specifically
for the detection of leaks to check all connections. A
failure to follow this warning could result in fire,
explosion, personal injury, or death.
The manual goes on to repeat this statement as a warning, stating
again to “[u]se a soap-and-water solution to check for leakage.”
Thus, while some portions of the furnace manual address the
installation of a gas pipeline system, a task assigned to Peed
Piping, other portions address installation and start-up of the
furnace, which in this case was assigned to Wittman Mechanical.
While it is undisputed that Wittman Mechanical did not
perform the soap-and-water test, it is also undisputed that had it
performed this test, the test would not have detected the leak.
The leak was at a location away from the furnace’s connection to
the system. It was located where the main gas line connects with
a spur gas line rising to the kitchen island. Thus, the jury
could well have concluded that Wittman Mechanical’s failure to
conduct the only test the manual required it to perform -- the
soap-and-water test at the furnace connection -- did not cause the
explosion. It was, thus, error for the district court to have
disregarded the jury verdict when evidence existed to support the
verdict.
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For similar reasons, the district court would not be able to
grant judgment notwithstanding the verdict on the negligence
claim. Even if it found that Wittman Mechanical was negligent in
activating the gas system, as requested by Virginia Residential,
the court would still have to recognize the possibility that the
jury could have found Virginia Residential contributorily
negligent in assuring Casteel that the system was ready to be
activated, thus denying the possibility of its recovering from
Wittman Mechanical. See Jenkins v. Pyles, 611 S.E.2d 404, 407
(Va. 2005) (citing Sawyer v. Comerci, 563 S.E.2d 748, 752 (Va.
2002)).
For the foregoing reasons, we vacate the judgment entered by
the district court and remand this case to the district court with
instructions to reinstate the verdict and to enter judgment in
accordance with the reinstated verdict.
IT IS SO ORDERED.
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