THE WASHINGTON HOUSE CONDOMINIUM ASSOCIATION OF OWNERS, On Its Own Behalf And On Behalf of Multiple Unit Owners, and WILLIAM E. MONTGOMERY, and TAMARA A. MONTGOMERY, Individually, Plaintiffs,
DAYSTAR SILLS, INC., a Delaware Corporation, DAVID N. SILLS, IV, WASHINGTON HOUSE PARTNERS, LLC, a Delaware Limited Liability Company, ARCHITECTURAL CONCEPTS, P.C., a Pennsylvania Corporation, AVALON ASSOCIATES OF MARYLAND, INC., a Maryland Corporation, and ENVIRONMENTAL STONEWORKS, LLC a Delaware Limited Liability Company, Defendants.
Submitted: June 29, 2018
Rule 54(B) Motion for Revision of the Court's
Interlocutory Order Dismissing Plaintiffs' Complaint
Against Defendant Environmental Stoneworks, LLC - GRANTED
Motion for an Award of Attorneys' Fees and Costs Against
Defendant Environmental Stoneworks, LLC - DENIED
Elizabeth Wilburn Joyce, Esquire (Argued); Seton C. Mangine,
Esquire; Pinckney, Weidinger, Urban & Joyce LLC,
Attorneys for Plaintiffs.
Loomis, Esquire; Delany McBride, P.C., The Brandywine
Building, Attorney for Defendant, Environmental Materials,
LLC d/b/a Environmental Stone Works.
J. Connolly, Esquire (Argued); Matthew D. Johnson, Esquire;
Post & Schell, P.C., Four Penn Center, Attorneys for
Defendant, Environmental Materials, LLC d/b/a Environmental
William C. Carpenter, Judge.
Washington House Condominium Association of Unit Owners
("WHCA"), on its own and on behalf of multiple unit
owners ("Washington House" or the
"Condominium"), William E. Montgomery, and Tamara
A. Montgomery (collectively "Plaintiffs") move for
a Rule 54(b) Revision of the Court's Interlocutory Order
Dismissing Plaintiffs' Complaint against Defendant
Environmental Materials, LLC d/b/a Environmental Stone Works
("Defendant" or "ESW"). Plaintiffs also
seek an Award of Attorneys' Fees and Costs against ESW.
explained further herein, Plaintiffs' Rule 54(b) Motion
for Revision of the Court's Interlocutory Order
Dismissing Plaintiffs' Complaint Against Defendant ESW is
GRANTED, and their Motion for an Award of Attorneys' Fees
and Costs against ESW is DENIED.
& PROCEDURAL BACKGROUND
litigation arises from the allegedly defective design and
construction of Washington House, located on Main Street in
Newark, Delaware. The Condominium contains fifty-four
residential units and four commercial units, two of which are
owned by the University of Delaware.
Although construction on the Condominium was completed in
2008, Plaintiffs did not discover the serious structural
issues plaguing the building until 2014. On January 14,
2015, Plaintiffs filed a complaint (the
"Complaint") against six defendants to recover more
than $7 million in repair costs and related expenses arising
from design and construction defects at Washington
THE ESW-DAYSTAR ACTION
Sills, Inc. ("Daystar") served as the developer,
builder, and general contractor for the Condominium project,
and was one of the six defendants named in Plaintiffs'
Complaint. Defendant ESW was hired by Daystar to
install the exterior masonry veneer, which is the primary
construction issue,  at Washington House.
January 30, 2009, ESW instituted a mechanics' lien action
against Daystar because it had not been paid for its exterior
work on the Condominium. Daystar filed a counterclaim against
ESW in response, alleging breach of contract, breach of
express and implied warranties, and negligence.
parties entered into arbitration to resolve their dispute,
agreeing that it would serve as a final adjudication on the
matter. On January 6, 2012, the arbitrator entered
a final order, which required ESW to pay $400, 000 to
Daystar. The $400, 000 judgment against ESW was
satisfied on March 2, 2012.
filed their Complaint against six defendants on January 14,
2015, seeking to recover more than $7 million in damages for
repair costs and related expenses "arising from design
and construction defects - notably, the systemic failure of
exterior brick and stone veneer ..."
Court dismissed Plaintiffs' Complaint against Defendant
ESW on the basis of res judicata in its October 28, 2015
Opinion. Now, Plaintiffs argue that new evidence,
which was not available to the Court at the time of its
October 2015 decision, refutes a finding of privity between
Plaintiffs and Daystar for res judicata purposes. On this
basis, Plaintiffs have moved for the Court to reconsider its
interlocutory order and deny the dismissal of Plaintiffs'
Complaint against ESW.
have now settled their claims against five of the defendants:
Daystar, David N. Sills, IV ("Sills"), Washington
House Partners, LLC ("WHP"), Architectural
Concepts, P.C. ("AC"), and Avalon Associates of
Maryland, Inc. ("Avalon") (collectively, the
"Settling Defendants"). All of Plaintiffs'
claims against the Settling Defendants have been voluntarily
dismissed with prejudice, in accordance with the settlement
agreements, and with the Court's approval.
Settling Defendants all previously filed cross-claims for
contribution and indemnity against ESW. This Court
denied ESW's motion to dismiss the cross-claims in its
August 2017 Opinion. At the pretrial conference on October
27, 2017, the Court severed the indemnity cross-claims
against ESW for separate disposition.Pursuant to
the settlements, the Settling Defendants have assigned their
indemnity claims to WHCA, and Plaintiffs are now the real
parties in interest on the assigned claims.
indemnity claims against ESW are based in part on the
Subcontract between Daystar and ESW ("ESW
Subcontract" or "Subcontract"), which
contained an indemnification provision that included
attorneys' fees. Based on the assignments of the Settling
Defendants' indemnity claims to WHCA, Plaintiffs now seek
to recover those defense costs and attorneys' fees from
the Court's decision on Plaintiffs' Motions.
MOTION FOR REVISION OF THE COURT'S INTERLOCUTORY ORDER
DISMISSING PLAINTIFFS' COMPLAINT AGAINST DEFENDANT
ENVIRONMENTAL STONEWORKS, LLC
Delaware Superior Court Civil Rule 54(b), "any order or
other form of decision, however designated, which adjudicates
fewer than all the claims or the rights and liabilities of
fewer than all the parties ... is subject to revision at any
time before the entry of judgment adjudicating all the claims
and the rights and liabilities of all the
of a decision under Rule 54(b) is "permitted in very
limited circumstances." As this Court has previously
The motion to reconsider would be appropriate where, for
example, the Court has patently misunderstood a party, or has
made a decision outside the adversarial issues presented to
the Court by the parties, or has made an error not of
reasoning but of apprehension. A further basis for a motion
to reconsider would be a controlling or significant change in
the law or facts since the submission of the issue to the
Court. Such problems rarely arise and the motion to
reconsider should be equally rare.
a Rule 54(b) revision "should occur only where the court
is convinced it is clearly wrong .. ."
Plaintiffs argue that evidence obtained in discovery shows
"Daystar's interests and Plaintiffs' interests
were not identical or closely aligned, and Plaintiffs were
not actively and adequately represented in the ESW-Daystar
Action" to support a finding of privity between the
parties. Plaintiffs primarily suggest that
Daystar was unable to adequately represent their interests in
the ESW-Daystar Action because it had to defend against its
own contributory negligence, of which Plaintiffs now have
"substantial evidence." For this reason,
according to Plaintiffs, the privity element of res judicata
is no longer satisfied and ESW's Motion to Dismiss
Plaintiffs' Complaint should now be denied. Additionally,
Plaintiffs contend that revision of the Court's Order
granting ESW's Motion to Dismiss is necessary to prevent
response, Defendant ESW argues that the allegedly new
evidence offered by Plaintiffs is not actually new and does
not constitute a significant change in the facts to warrant
revision of the Court's Order. ESW also claims that
Plaintiffs waived their prevention of manifest injustice
argument by failing to raise it in earlier
Delaware law, the doctrine of res judicata bars a subsequent
action when the ...