NVR, Inc. v. Harry A. Poole, Sr. Contractor, Inc.

NVR, INC., Plaintiff, v. HARRY A. POOLE, SR. CONTRACTOR, INC. et al., Defendants.

Civil Action No. ELH-14-241

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND

March 13, 2015

MEMORANDUM OPINION

This suit arises out of a contractual dispute relating to the construction of Eden Brook, an age-restricted (55+) residential condominium located in Odenton, Maryland (the "Condominium"). NVR, Inc. ("NVR"), plaintiff, was the developer of the Condominium, which consists of more than 200 units in multiple buildings.¹ NVR hired various contractors, including defendants Harry A. Poole, Sr. Contractor, Inc. ("Poole"); ESN Construction, Inc. ("ESN"); and Plus One Masonry Company, Inc. ("Plus One"), to carry out various phases of the construction.²

Of particular relevance here, on or about August 18, 2003, NVR entered into anagreement (ECF 10-4, the "Contract") with Poole for the installation of brick masonry veneer for thirteen of the fourteen buildings of the Condominium. ECF 45 ¶ 9; see ECF 10-4, Contract. NVR also entered into contracts with ESN and Plus One to perform rough framing work and additional installation of brick masonry veneer. ECF 45 ¶¶ 10-11.

In January 2014, plaintiff filed suit against defendants (ECF 1, the "Original Complaint" or "Complaint") alleging, inter alia, negligent construction. See id. The Original Complaint contained three claims: Breach of Contract (Count I); Express Indemnity (Count II); and Indemnity Implied by Law (Count III). Id. 33-47.³ It was supported by two exhibits: the complaint filed in the Circuit Court for Anne Arundel County, Maryland, captioned Eden Brook Condominium, Inc. v. NVR, Inc. et al., Case 02-C-11-158348 (ECF 1-1, the "Eden Brook Complaint"); and the Verdict Sheet issued by the jury in that case (ECF 1-2, the "Verdict Sheet").⁴ NVR amended its Original Complaint to add a claim for Contribution (Count IV) against defendants Poole, ESN, and Plus One. ECF 45 (the "Amended Complaint"). The Amended Complaint is the operative pleading.

ESN filed a Third-Party Complaint against H&S Construction and Framing, Inc. ("H&S") for Breach of Contract, Express Indemnity, Indemnity Implied by Law, and Contribution. ECF 8. And, Poole filed a Third-Party Complaint (ECF 40) against J C & Gonzalez Masonry, Inc., Jose J Gonzalez individually, and Jose J. Gonzalez as Trustee of the Assets of Johan & Gonzalez Masonry Inc. (a forfeited corporation) (collectively "Gonzalez"), forIndemnification and Contribution. Gonzalez filed a Cross Claim against Poole, ESN, Plus One, and H&S for Indemnification and Contribution. ECF 54.

A settlement was reached between NVR, Plus One, ESN, and H&S. They filed a "Stipulation Of Dismissal With Prejudice Of Certain Claims Involving NVR, Plus One, ESN, and H&S." (ECF 88, "Stipulation"). Pursuant to the Stipulation, all of the claims brought by NVR against Plus One, ESN, and H&S have been dismissed, and ESN's claims against H&S were also dismissed. See ECF 89 (Order approving Stipulation). Consequently, ESN withdrew its pending motions. ECF 86; 87.

Claims involving NVR, Poole, and Gonzalez are at issue. Now pending is Poole's Motion to Dismiss or, in the Alternative, Motion for More Definite Statement (ECF 56, the "Motion"), supported by a memorandum (ECF 56-1) (collectively, the "Motion"). NVR opposes the Motion (ECF 70, the "Opposition") and Poole has replied (ECF 83, the "Reply").⁵

The Motion has been fully briefed, and no hearing is necessary to resolve it. See Local Rule 105.6. For the reasons that follow, I will deny the Motion.

FACTUAL BACKGROUND⁶

Eden Brook Condominium, Inc. (the "Association") hired NVR to develop the Condominium. ECF 45 ¶ 8. In turn, NVR hired various contractors, including defendants Poole, ESN, and Plus One, to construct multiple buildings and common elements of the Condominium.Id. Built between 2005 and 2008, the Condominium consists of 224 residential units occupying fourteen buildings in Odenton, Maryland. Id. ¶ 7. The Condominium was designed as an age-restricted community and its Association is a membership consisting of the 224 unit owners. Id.

Of relevance here, NVR entered into a contract with Poole to install brick masonry veneer at thirteen of the fourteen Condominium addresses.⁷ Id. ¶ 9. That work included the installation of the brick exterior facade according to the applicable plans and project specifications provided by NVR. Id. Poole was also responsible for supervising the work of its subcontractors. Id. ¶ 13.

Sometime between 2008 and 2011, alleged defects as to the framing and masonry work were discovered at the Condominium structures. See id. ¶¶ 15-16, 25.⁸ Among the issues reported were incomplete installation of cavity and window flashings⁹ and improper installation of underlayments¹⁰ beneath brick siding, allowing water to penetrate into the interior of Condominium units. Id. ¶ 23.

In January 2011, the Association brought suit against NVR in the Circuit Court for AnneArundel County, Maryland, on behalf of itself and "individual unit owners,"¹¹ captioned Eden Brook Condominium, Inc. v. NVR, Inc. et al., Case 02-C-11-158348. ECF 45 ¶ 16; see ECF 1-1, Eden Brook Complaint. The Eden Brook Complaint consisted of eight claims: Negligent Construction (Count I); Breach of Title 10 Implied Warranties (Md. Code, Real Property Article § 10) (Count II); Negligent Misrepresentation (Count III); Violation of the Maryland Consumer Protection Act (Count IV); Breach of Express Warranty (Count V); Breach of Title 11 Implied Warranties (Md. Code, Real Property Article § 11) (Count VI); Negligent Repair (Count VII); and Breach of Contract (Count VIII). ECF 1-1 ¶¶ 27-81. The Association sought to recover damages for alleged defective construction of the Condominium. ECF 1-1, Eden Brook Complaint, ¶¶ 16-17.

The State case proceeded to a jury trial in October 2012. ECF 45 ¶ 20.¹² Evidence was presented as to the defective construction of the Condominium. Id. ¶¶ 21-24. In its suit here, NVR asserts, in part, id. ¶¶ 20-24 (emphasis omitted):

20 . . . The largest component of the Condominium Association's damage claim involved the removal and replacement of the veneer of all fourteen buildings which it claimed was necessary as a result of the damage caused by the defective work performed by Poole, Plus One and ESN. . . .

21 . . . The Condominium Association's expert witnesses provided testimony and opinions concerning the improper masonry and framing work at the Condominium that allegedly violated the Construction Documents, applicable building codes, manufacturers' instructions, industry standards and/or the applicable standard of care . . . .

22 . . . [T]he Condominium Association's experts testified at length concerning claimed deficiencies and resulting damages involving, among other things, a) weep holes improperly located below grade¹³; b) the lack of end dams; c) failure to properly shingle the underlayment; d) improper brick flashing that does not extend far enough to the face of the brick; e) unprotected steel that corroded; f) incomplete underlayment that exposed the wood sheathing/framing; g) deflected lintels; and h) improper use/installation of brick ties.

23 . . . [W]ith respect to the framing work, the Condominium Association's experts testified at length concerning claimed deficiencies and resulting damages involving, among other things, a) improper window installation; b) use of improper flashing materials; c) lack of window caulk/sealant; d) improper flashing of underlayment; and e) improper installation of house wrap.

24 . . . The Condominium Association offered into evidence field inspection notes, reports and photographs showing, among other things, alleged damage to interior finishes (e.g., wood rot, damaged window frames and mold) and damage to exterior finishes (e.g., rotted and wet sheathing, framing, and resulting interior damage) which resulted from the work performed by Poole, Plus One, and ESN.

On November 19, 2012, the jury returned a verdict against NVR, awarding the Association $5,629,715.00. See ECF 1-2 at 2, Eden Brook Jury Verdict. Of that sum, the jury appears to have attributed $4,032,837.00 to defective installation of brick work.¹⁴ See id. Thereafter, NVR "paid an amount to the Condominium Association in satisfaction of the money judgment." ECF 45 ¶ 28.

This suit followed. As indicated, NVR alleges, inter alia, that Poole was negligent in constructing the Condominium and thus NVR is entitled to damages from Poole.

Additional facts are included in the discussion.

I. Standard of Review

A. Rule 12(b)(6)

A motion to dismiss under Fed. R. Civ. P. 12(b)(6) tests the adequacy of a complaint. To survive a Rule 12(b)(6) motion, a complaint must satisfy the pleading standard articulated in Fed. R. Civ. P. 8(a)(2), which requires a "short and plain statement of the claim showing that the pleader is entitled to relief." The purpose of the rule is to provide the defendant with "fair notice" of the claim and the "grounds" for entitlement to relief. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555-56 & n. 3 (2007). That showing must consist of more than "a formulaic recitation of the elements of a cause of action" or "naked assertion[s] devoid of further factual enhancement." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal citations omitted); see Painter's Mill Grille, LLC v. Brown, 716 F.3d 342, 350 (4th Cir. 2013).

To defeat a motion under Rule 12(b)(6), a complaint "must plead facts sufficient to show that [the] claim has substantive plausibility." Johnson v. City of Shelby, Miss., ___ U.S. ___, 135 S. Ct. 346, 347 (2014); see Iqbal, 556 U.S. at 684 ("Our decision in Twombly expounded the pleading standard for 'all civil actions' . . . .") (citation omitted); Twombly, 550 U.S. at 570; see also Epps v. JP Morgan Chase Bank, N.A., 675 F.3d 315, 320 (4th Cir. 2012); Simmons v. United Mortg. & Loan Inv., LLC, 634 F.3d 754, 768 (4th Cir. 2011). If the "well-pleaded facts do not permit the court to infer more...