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Franciscan Hill Homeowners Association v. Newhall Land and Farming Co.12/3/2003
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.
These consolidated appeals arise from construction defect litigation following the 1994 earthquake. Newhall Land and Farming Company (Newhall), the developer of the Franciscan Hill Condominium Complex (complex), appeals from a judgment following an $8.5 million jury verdict in favor of the Franciscan Hill Homeowners' Association (HOA) and its insurer, State Farm Fire and Casualty Co. (State Farm), on an action for damages based on strict liability and negligence in the construction of the complex. Newhall also appeals from a directed verdict and judgment of non-suit on its cross-complaint against its subcontractors for contractual indemnity, and the trial court's order denying its attorney fees motion.
Newhall's appeal raises two instructional errors, one involving the damages instructions in light of our Supreme Court's decision in Aas v. Superior Court (2000) 24 Cal.4th 627 (Aas), and the other involving causation. Newhall also challenges the trial court's conclusion that the indemnity provision in its contract with its subcontractors (subcontract) required a finding of fault in order to trigger the indemnity obligation. That determination led to the trial court's orders (1) granting two subcontractors' motion for non-suit, (2) directing a verdict in favor of a third, and (3) denying Newhall's motion for attorney fees against the subcontractors.
We conclude that both instructional errors were prejudicial. While we agree with Newhall that the trial court erred in deciding that the indemnity provision in the subcontract required a finding of fault, we nevertheless conclude that the trial court correctly granted the non-suit motion and directed a verdict in favor of the subcontractors because Newhall presented no evidence at trial that its liability to State Farm and HOA arose from the subcontractors' work on the complex. Finally, we conclude that the trial court erred in denying Newhall's motion for attorney fees because the duty to defend in the subcontract was a separate and distinct duty triggered when HOA and State Farm asserted a claim implicating the subcontractors' performance on the subcontract. We therefore reverse the judgment in favor of HOA, and affirm the judgment in all other respects. We also reverse the order denying Newhall's attorney fees motion and granting attorney fees to the subcontractors.
In its cross-appeal, HOA appeals from the judgment following the dismissal of its loss-of-use claim and dismissal of its implied warranty claim. In a separate appeal, HOA appeals from the denial of its motion for prejudgment interest. We affirm the dismissal of the loss-of-use claim, lack jurisdiction to hear the appeal on the implied warranty claim, and dismiss as moot the appeal challenging the trial court's ruling denying HOA prejudgment interest.
The individual condominium owners (owners) separately appeal from the dismissal of their action following the trial court's order sustaining a demurrer to the third amended complaint alleging a loss-of-use claim. We conclude that the trial court erred in sustaining the demurrer because the amendments to the third amended complaint were technical ones. We therefore reverse.
FACTUAL AND PROCEDURAL BACKGROUND
1. The Construction, Destruction, and Repair of Complex
Newhall developed the 71-unit complex located in S
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