Gray·Duffy Successfully Defends Appeal Involving Defense and Indemnity Obligations to a General Contractor

September 2009

Overview

Michael Eisenbaum of Gray·Duffy’s Encino office prevailed on an appeal of the trial court’s decision limiting the firm’s client’s defense and indemnity obligations owed by a grading subcontractor to a general contractor.

Discussion

Trung Mai, et al. v. Melchiori Construction Company, et al.

The plaintiff, Trung Mai, sought damages of approximately $1.8 million to repair a large landslide that had occurred on their five-acre property during heavy rains in early 2005.  Mr. Eisenbaum defended Camozzi Excavation, Inc., the grading subcontractor for the general contractor, Melchiori Construction, during the original construction of the property.  At trial the jury awarded the plaintiffs $1.25 million in damages.  The jury apportioned fault, with an allocation of five percent to Camozzi Excavation, 55 percent to Melchiori Construction, and the remaining percentage to the soils engineer and original owners of the property.

After the trial, Melchiori pursued a cross-complaint against Camozzi pursuant to the “Type I” express indemnity provisions of the subcontract agreement. Melchiori sought its defense costs of approximately $580,000 against Camozzi and Melchiori’s 55 percent share of the damages. 

The trial court ruled in favor of Camozzi, determining that Camozzi pay only five percent of the plaintiffs’ damages, and further ruled that Camozzi only owed approximately $23,000 to reimburse Melchiori for its defense costs.  Melchiori appealed this ruling.

On appeal, Melchiori asserted that the trial court’s ruling was incorrect and sought to have the Court of Appeal direct the trial court to enter a new judgment awarding all of its fees, as well as an order for Camozzi to pay Melchiori’s share of the damages awarded by the jury.  Mr. Eisenbaum filed a respondent’s brief with the Court of Appeal and supplemented the record on appeal with the trial court’s express findings, which Melchiori had originally excluded from the record on appeal.

The Court of Appeal issued its opinion, upholding all aspects of the trial court’s rulings in favor of Camozzi Excavation.  Melchiori filed a petition for Supreme Court review, which is currently pending.

Please Note: This article is necessarily general in nature and is not a substitute for legal advice with respect to any particular case. Readers should consult with an attorney before taking any action affecting their interests.