CASE DAVIS V BAUGH INDUSTRIAL CONTRACTORS INC Glacier Northwest hired Baugh Industrial Contractors to build a processing facility including underground pipe system 3 years later Glacier suspected a pipe leak Assigned an employee Davis to uncover the leak While Davis was in the hole to get to the pipes a concrete wall collapsed killing him Pipes should last 100 yrs These were likely damaged in the installation prob expert testimony which caused the leak Davis daughter sued Baugh others for negligence in father s death The trial court used the precedent that when a contractor finishes work owner accepts it the contractor Baugh is no longer liable only the property owner has liability Suit dismissed at trial court Appealed to Supreme Court of Washington HELD Reversed and remanded DID SHE WIN HELD Court rejected previous common law rule and accepted a more modern approach The contractor is liable for injury to 3rd parties because of negligent work EVEN IF the work was accepted by the property owner WHY Construction has become highly scientific and complex Landowners rely on a contractor s expertise and non expert landowners often don t recognize poor performance by the contractor Liability occurs when it is reasonably foreseeable that a 3rd party could be injured due to the contractor s negligence QUESTIONS 1 The court rejected the common law rule concerning completion and acceptance that had been in effect until this decision and ordered a new trial Key reason for that decision How does this affect liability shifts from landowner to contractor The old rule had been abandoned by most states already It was outmoded because the complexity of construction has increased i ii What would you advise your contractor clients Look at predictability certainty What was atty telling clients 2 A judge on the court dissented Explaining his opposition to the decision he said this change in the law should have been done by the legislature in a statute not the court What are the practical problems with such a view a a Legislatures rarely fiddle with relatively technical rules of law They deal with broader issues or ones that have an immediate political payoff Further the construction industry was lined up in opposition to changing the rule The legislature would be more likely to crater to such organized opposition than the court There was no organized opposing support CASE LAMSON V CRATER LAKE MOTORS ETHICS V LAW For 15 years Kevin Lamson was sales manager for car dealership Good employee valued his job liked the company s motto customers come first Good reputation for high standard of ethics and integrity Sales were lagging Company hired outside sales firm Real Performance Marketing RPM to run a company 5 day sales promotion Lamson observed several unethical or unlawful activities RPM video said all vehicles cut in price only video vehicles were on sale RPM tried to pack the payments providing life ins service contracts in purchase agreements WITHOUT customer s knowledge Lamson complained to General Manager GM was told go home After the sale relations worsened between Lamson GM GM told Lamson that another sales manager was making 600 profit per sales Lied Lamson found out it was only 100 GM hired RPM to run another sales GM Lamson argued Lamson told GM he thought GM wanted him out GM said You re right Told Lamson to cooperate with RPM Lamson gave company owner a complaint letter re RPM said it violated sales ethics need to rethink profit at any cost mentality Owner said company was ethical Said no RPM illegality or misrepresentations Lamson did not cooperate with RPM Was fired Lamson sued for wrongful discharge because he complained about illegality and violation of company s code of ethics Jury holds for Lamson Company appealed HELD Reversed Lamson lost who applied what No wrongful discharge Under At Will Employment Employees can be fired for any reason Explain at will fired without just Exceptions Here Lamson not directed to participate in 1 unlawful activities Internal complaints not external of unlawful sales practices are not a 2 societal duty protected at cause law Lamson not discharged for fulfilling a 3 public duty protected at law No evidence that company tried to 4 silence Lamson to conceal illegal activities Lamson s concerns re RPM s sales tactics were laudable HOWEVER wrongful discharge is narrowly defined this discharge was not unlawful ETHICS SHOULD THE COURTS BE ENFORCERS OF COMPANY S ETHICAL PRACTICES AND CODES OF Codes of ethics are internal documents that usually have no legal consequence The job of courts is to enforce the law not act as ethics arbiters It would be a great expansion of power and duties for courts to act as evaluators of ethical issues in companies that went beyond legal obligations CASE BLIMKA V MY WEB WHOLESALER LLC My Web Wholesalers of Maine does business on the internet Blimka Of Idaho surfed the net found My Web and called DePalma a My Web manager Ordered 26 500 pairs of jeans for 20 935 and wired money Shipment of 16 000 jeans arrived Blimka called My Web to also complain about quality Jeans for 1 dollar quality defendant s in Maine Blimka sued for fraud against My Web and DePalma in Idaho court Process was served on No response by defendants court issued a judgment against both defendants saying it had jurisdiction They appealed HELD Affirmed Idaho court has jurisdiction Defendants actions of fraud invoked the use of the Idaho long arm statute Defendants purposeful false misrepresentation directed into Idaho created minimum contacts with Idaho that does not offend 14th amendment traditional notions of fair play and substantial justice Blimka awards attorney fees and costs QUESTIONS 1 The Idaho high court held that Idaho courts did have jurisdiction over an out of state seller who misrepresented goods sold over the internet Does this mean most internet based sellers are subject to jurisdiction in every state where they do business a Yes if they do active business The standard is the same as it is for traditional businesses Once a business enters a state to do business especially when there are actual sales not just discussions it subjects itself to its law 2 Why did My Web not move the case from Idaho state court to federal court Bias against defendant diversity of citizens CASE DAVIS V WEST Houston Reporting Service HRS provided court reporting services for attorney Davis depo EXPLAIN HRS billed Davis was never paid 1 Sued for 1083 98 deposition plus