De Landaverde v. Navarro

238 Md.App. 224

189 A.3d 849

Claudia Maria Figueroa De LANDAVERDE, et al.

v.Santiago NAVARRO, et al.

Elizabeth Gomez, et al.

v.Parrish Services, Inc., et al.

No. 1719, 2089, Sept. Term, 2016

Court of Special Appeals of Maryland.

July 26, 2018

Argued by: Patrick A. Malone (Daniel C. Scialpi, Patrick Malone & Associates PC, for Appellant.

Argued by: Matthew T. Angotti (Ryan K. Bautz, Anderson, Coe & King, LLP, Baltimore, MD) Eric C. Hitzel (Kristen L. Dorsey, Greenspan, Hitzel & Schrader, Silver Spring, MD), all on the briefs, for Appellee.

Panel: Graeff, Leahy, James P. Salmon (Senior Judge, Specially Assigned), JJ.

Salmon, J.

On the evening of April 23-24, 2012, five people were residing at a house located at 722 Shelby Drive, Oxon Hill, Maryland. All five died that evening of carbon monoxide poisoning. The cause of that poisoning was that some unknown person or persons had negligently connected the home's bathroom ventilation fan to the flue that was supposed to carry carbon monoxide gas from the boiler and water heater up through the ceiling and through the roof. On the evening in question, someone evidently left the bathroom fan on, and later that evening, due to the improper fan connection, carbon monoxide gas backed up and entered the rooms occupied by the victims. Those victims were: Sonia Chavez, Oscar Chavez, Nora Leiva, Francisco Gomez, and Nelson Landaverde.

The decedents' spouses and children filed in the Circuit Court for Prince George's County complaints for negligence and wrongful death against Homesure Services, Inc. ("Homesure"), Safeguard Properties, LLC ("Safeguard"), Caviness Mechanical Services ("Caviness"), and Parrish Services Inc. ("Parrish"). In addition, the spouses and children of Landaverde and Gomez filed actions against Santiago Navarro, one of the owners of the house where the carbon monoxide poisoning occurred. Subsequently, the claims against Homesure and Safeguard were dismissed without prejudice.

Navarro, Caviness, and Parrish filed motions for summary judgment. After a hearing on October 3, 2016, the circuit court denied Navarro's motion for summary judgment and granted summary judgment in favor of Caviness and Parrish. Subsequently, pursuant to a voluntary stipulation, the actions against Navarro were dismissed without prejudice. In these consolidated cases, the spouses and children of the victims noted timely appeals.

QUESTIONS PRESENTED

Appellants present two questions for our consideration which we have rephrased, slightly, and reordered as follows:

I. Did the circuit court err in finding that a home warranty contract between a home owner and a warranty company absolved Caviness and Parrish from any tort duty to address rust and holes on the flue pipes of a heating and hot water system at 722 Shelby Drive?

II. Did the circuit court err in finding that Caviness and Parrish had no tort duty, as a matter of law, to address rust and holes on the flue pipes of the heating and hot water systems they worked on at 722 Shelby Drive?

For the reasons set forth below, we answer both questions in the affirmative and reverse the judgments entered in favor of Caviness and Parrish.

FACTUAL BACKGROUND

In February 2010, Sonia Chavez and Santiago Navarro purchased a single family home located at 722 Shelby Drive in Oxon Hill.¹ Navarro never lived at 722 Shelby Drive. There was evidence that he was a friend of Sonia and Oscar Chavez and had agreed to purchase the home with Mrs. Chavez because Mr. Chavez had a bad credit history.

Starting in February 2010, Mrs. Chavez and her husband lived in the home and rented rooms to Nelson Landaverde and Francisco Gomez. At the time of the incident giving rise to this case, Mrs. Chavez's sister, Nora Leiva, was also staying in the home.

The decedents' spouses and children filed identical suits against Caviness and Parrish alleging that fatal amounts of carbon monoxide entered the home as the result of an improperly installed bathroom fan that had been spliced into the flue used to vent exhaust from the boiler and hot water heater. The date the fan was installed is unknown.²

At the time Mrs. Chavez and Mr. Navarro purchased the home, they entered into a home warranty agreement with Homesure that covered repairs to a number of appliances in the home, including the heating system and hot water heater. The warranty agreement provided that Homesure would "pay the covered costs to repair or replace the items listed as covered ... if any such items become inoperable during the term of this Agreement due to mechanical failure caused by routine wear and tear, subject to the terms and conditions of this Agreement." The warranty agreement covered the mechanical components of one primary central heating system, but did not cover "[c]himneys, flues, and liners[.]" The agreement also covered the mechanical parts and components of one water heater, but did not include "flues; vent pipes/lines[.]" If a claim was covered, Homesure agreed to provide Mrs. Chavez "with a referral to an independent contractor," whom Homesure had the "sole authority" to select.

The relationship between Caviness and Parrish and the warranty company, Homesure, was governed by a service provider's agreement pursuant to which Caviness and Parrish agreed to collect deductibles and excess fees from customers and to bill Homesure directly at pre-negotiated discounted rates.³ All parties agreed that Caviness and Parrish were independent contractors.

On March 1, 2010, Mrs. Chavez contacted Homesure and reported that the heating system was not working properly. Homesure arranged for Caviness to respond to Mrs. Chavez's complaint. On March 2, 2010, Caviness employee, Darren Baine, went to the home, determined that there was a defective pilot control module on the boiler, and the next day, replaced it.

A few months later, on June 3, 2010, Mrs. Chavez contacted Homesure to report that the hot water heater was not working properly. On this occasion, Homesure arranged for Parrish to respond to Mrs. Chavez's complaint.

On June 4, 2010, Parrish employee, Robert Rhoades, went to the home, determined that the pilot light would not stay lit, and ordered a replacement gas control valve. He returned to the home on June 10, 2010 and installed the new valve.

The motions court was provided with a picture, taken by a home inspector in 2008, that appellants claim shows rust on the flue pipe from which the heater and boiler vented.

The appellants claimed that the service technicians from Caviness and Parrish should have discovered that there were holes and rust on the flue through which the exhaust from both the boiler and hot water heater vented, warned the occupants of the home that carbon monoxide poisoning could occur if the flue was structurally compromised as a result of the rust and holes, and fixed the damaged flue pipe. They also claimed that the service technicians from Caviness and Parrish should have investigated the cause of the rust-damaged flue pipe or informed the occupants of the home that the boiler and hot water heater were not safe to use until such investigation was performed. Further, they asserted that a competent investigation into the cause of the rust-damaged flue pipe would have revealed the life-threatening connection between the bathroom ventilation fan exhaust and the flue for the boiler and hot water heater.⁴

Darren Baine, the service technician from Caviness who performed service on the heating system at 722 Shelby Drive, in the early part of March 2010, died in September 2011. The only document pertaining to the work he performed was an invoice.

Caviness's corporate representative and owner, David Caviness, testified in a deposition that all of his company's work in 2010 was obtained through home warranty companies including, but not limited to, Homesure. He explained that typically there was an established price limit for repairs and Caviness could perform any work with a cost under that limit while more expensive work required pre-authorization from the warranty company. Mr. Caviness stated that his company's employees were never instructed not to look for problems with flue pipes even though flue pipes were never covered by any of the home warranty companies for whom his company worked. On that point, he gave the following deposition testimony:

[Mr. Caviness]: That's how you make your money. Go in and look for a problem, especially a problem that's not covered, that's when you make your money with the warranty company. Try to find as many problems as you can that's lack of maintenance, something that's not covered under the contract. That's the only way you make money with the warranty companies. Now, it's between you and your – your – the homeowner.

[Plaintiffs' Counsel]: If I understand correctly, the only – you're saying the only way you make money is, essentially, by billing somebody, other than the home warranty company?

[Mr. Caviness]: Right.

[Plaintiffs' Counsel]: Okay.

[Mr. Caviness]: Basically, the home warranty companies, they give them out when they – people buy the house and you're hoping to God that they break away from the warranty company and they – they use your services afterwards, you know. But some people are lifetime warranty people and, you know, when you go into jobs with the Homesure, they didn't cover maintenance issues, improper installations. They didn't cover none of that, flue pipes.

And then, if you go in and you see a problem, bam, now you got – hey, get right on the phone. Look, you need this, this, this. And then the warranty company will say, well, this is not covered, we'll give the homeowner a call, let them know this is – well, how much is your COD estimate. Give them a price, they call.

Then after they take care of that, you call the warranty company – or the customer and say, hey, look, we can come out and do the job, so....

Mr. Caviness acknowledged that neither his company nor his employees were employees of Homesure and that the warranty company did not give directions or...