final_review_questions_08 - AEM 320 NBA 560 Business Law I...

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AEM 320; NBA 560 Business Law I Fall, 2008 Property and Agency Review Problems 1. Dave, a computer science professor at Cornell, used the inheritance he received from his uncle to buy the Colonial Building on the Commons in downtown Ithaca. He entered into an agreement with Ajax Construction Company to totally renovate the building, both inside and out. Ajax had submitted a bid to do the work after reviewing blueprints furnished to Dave by Design, Inc., a local architectural firm and visiting the site to look at the building. Unfortunately, the project did not proceed smoothly and Dave has some serious problems. a. In renovating the exterior of the building, Ajax set up scaffolding to allow its workers to reach the top floors to refinish the window frames and sandblast the stone. While two men were sandblasting the front of the building one morning, the scaffolding started to give way. One of the workmen dropped the equipment he was using in an effort to keep from falling himself and the piece of equipment fell and struck Patsy who was walking along the sidewalk below. Patsy is suing Ajax and Dave, alleging that they should have restricted a larger portion of the sidewalk area so that this type of accident would not occur. Assuming that Ajax is negligent , does Dave need to worry about liability? Why or why not? New York Labor Law 240 makes an owner liable without fault for injuries sustained by third parties during construction projects. If there is no reference to the statute, than Dave will be liable without fault if Ajax is doing something ultrahaz ardous -- the exception to the general rule that one is not liable for the torts of an independent contractor . Dave will also be liable using respondeat superior if Ajax is considered an employee acting within the scope of its employment. Given the lack of facts, and the general rule that building contractors in this setting are one of the best examples of an independent contractor, this is not a very strong answer. b. Part of Dave's contract with the architects provided that Design, Inc. would oversee the construction process to insure that the work was done well and in a timely fashion. Several weeks into the project, Dave learns from the supervising architect that he had been contacted by Ajax and told that in removing the existing ceilings in the building they discovered asbestos-wrapped pipes that had to be completely replaced at significant additional cost in order to comply with state law. Without informing Dave, the architect had given Ajax permission to replace the piping. In addition, Dave learned that the supervising architect and Ajax's president are cousins. Furious, Dave wishes to fire Design, Inc., hold the firm responsible for the additional costs incurred on the job, and perhaps recover 1
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damages if he can prove there was some kind of misconduct in the bidding process that had been supervised by the architects. Please advise Dave as to whether he has an legal basis for action.
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  • Fall '07
  • Ajax, general rule

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