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At the end of July, the 11th Circuit Court of Appeals affirmed
the dismissal of a roofing contractor’s complaint against
another roofing contractor for allegedly interfering with its
contract with a condominium association for roof repairs relating
to Hurricane Irma. The case illustrates the importance of timing
and advancing work related to insurance claims and should serve as
a warning to those that regularly wait on insurance payments before
beginning work.
While the full analysis of the case is below, one of the key
reasons the first roofing contractor’s claims were dismissed
was because the court found that after the project had sat for over
two years, there was no real way the second roofing contractor
would have any reason to know or think that another contractor had
a contract to repair damage that was over two years old. One of the
key takeaways from this should be the contractors signing contracts
and then waiting on insurance approval before starting work may
have a hard time claiming interference or breach of contract if the
property owner ends up using another contractor if the insurance
carrier takes a long time to approve payment. Contractors should
make sure the process moves as quickly as possible and that they
are keeping their customers updated on progress.
Full Case Analysis
CMR Construction and Roofing, LLC v. Universal Contracting
Florida, arises out of damage to a condominium roof caused by the
Hurricane Irma, and attempts to complete that work. In April 2018,
a condominium association hired a roofing contractor to repair the
hurricane-caused damage to its roof. As part of this, the
Association directed its insurance carrier to pay the roofer for
its work. In May 2020, the association hired a second roofing
contractor to perform the same work that was covered under the
contract with the first roofing contractor, and demanded that the
first roofing contractor cease all work.
The first roofing contractor claimed that it had performed under
the contract and pursued payment from the insurance carrier. After
it was terminated by the association, the first roofing contractor
sued the association and the second roofing contractor.
Specifically, the first roofing contractor sued for tortious
interference with its contract and relationship with the
association, and violations of Florida’s Deceptive and Unfair
Trade Practices Act (“FDUPTA”).
In support of the tortious interference claims, the first
roofing contractor claimed that the second roofing contractor
submitted a bid to perform the same work as the first roofing
contractor to the association, despite knowing that the association
and the first roofing contractor had already entered into a
contract for the same work. The first roofing contractor claimed
that this caused the association to breach its contract with the
first roofer. The first roofing contractor also claimed that this
conduct violated FDUPTA.
The second contractor moved to dismiss these claims, and its
motion was granted. The trial court’s basis for granting the
motion, in part, recognized that there was no way that the second
roofing contractor could know that there was an existing contract
to perform work on the roof to repair storm damage when over two
years had passed since the occurrence of the damage. Further, the
court dismissed the FDUPTA claim because there was no injury to a
consumer pleaded in the complaint. The first roofing contractor
ultimately appealed the dismissal of its lawsuit.
On appeal, the Eleventh Circuit Court of Appeals affirmed the
dismissal. In addressing the dismissal of the FDUPTA claim, the
court noted that the first roofing contractor had not alleged that
the second roofing contractor’s conduct harmed any consumers,
as would be required to state a claim under FDUPTA. And while the
court acknowledged that non-consumers could bring claims under
FDUPTA, they still must claim an injury to consumers as the basis
for the claim. Here, the appellate court agreed with the trial
court that the injury complained of was strictly to the first
roofing contractor and not any consumers.
In addressing the dismissal of the tortious interference claims,
the appellate court indicated that the second roofing
contractor’s submission of a bid, as part of a competitive
bidding process, to do work the first roofing contractor had
originally agreed to perform, did not rise to the level of
intentional, unjustified interference or collusion. Further, the
court found that these allegations did nothing to establish that
the second roofing contractor had knowledge of the first roofing
contractor’s existing contract.
While it can be tempting to pursue claims against another
contractor when they take over a project, this case illustrates
that the mere fact that another contractor got the work may not be
sufficient to establish a claim against that contractor.
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