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Geotechnical News • September 2013
53
ASFE NEWS
Sain’s plans. By separate agreement
(“the testing and inspection contract”),
Wal-Mart retained Qore to serve as
the testing and inspection firm during
construction to make sure that the
plans and specifications prepared by
Sain were followed.
Two and a half years after all parties
finished their work and the new store
opened, Wal-Mart began observing
signs of stress and failure within the
building and parking lot. Wal-Mart
sued all three contracting firms for
breaches of contract and negligence,
seeking over $11.8 million in damages
– $5.35 million for the cost of repair-
ing the building and parking lot, and
$6.5 million for the diminished value
of the new building.
After a twelve-day trial, the district
court charged the jury with assessing
liability and damages in three catego-
ries: damage to the building, damage
to the parking lot, and diminution in
the building’s value. On the issue of
damage to the building, the jury found
Qore and SSW both liable, assigning
10% of fault to Qore and 90% of fault
to SSW. The jury awarded damages in
the amount of $486,000 on this issue.
Qore was responsible for $48,600 of
this amount.
For damage to the parking lot, the jury
found SSW 50% liable and Wal-Mart
50% liable. The jury awarded Wal-
Mart approximately $1.6 million in
damages here. Discounting for Wal-
Mart’s contributory negligence, SSW
was responsible for roughly $797,500
of the total damages award on this
claim.
And on the issue of diminution in
building value, the jury found that
none of the three contracting firms
were liable, and thus, no damages
were awarded in this category.
The jury rejected all claims of liability
brought against Sain. The jury also
determined that Qore’s 10% liability
on the building repair claim was attrib-
utable entirely to its work performed
under the testing and inspection
contract. The jury attributed no fault to
Qore for its work completed under the
geotechnical-services contract.
Both of the contracts between Wal-
Mart and Qore discussed attorney’s
fees. The geotechnical services con-
tract provided that:
Each party shall bear its own
expenses of litigation (including
without limitation attorneys’ fees),
without regard to which is the
prevailing party.
But the testing and inspection contract
included an indemnification clause
that covered attorney’s fees:
The Testing and Inspection
Firm [Qore] further agrees to
indemnify and hold Wal-Mart
free and harmless from any claim,
demand, loss, damage, or injury
(including Attorney’s fees) caused
by any negligent act or omission
by the Testing and Inspection
Firm, its agents, servants, or
employees.
This contract provision is the focal
point in this appeal.
By post-trial motion, Wal-Mart sought
to recover from Qore all its attorney’s
fees incurred in this litigation – on
all claims, successful and unsuccess-
ful, and against all parties – which
amounted to $990,000. In ruling on
the motion, the district court opined
that “[i]t might appear . . . [that] attrib-
uting the entirety of that $990,000 to
Qore, who is only liable for $48,600
in damages is unreasonable. However,
attributing the whole of the reasonable
attorney’s fees to Qore is supported
by Fifth Circuit case law.” (Here, the
court was referring to the decision in
Cobb v. Miller,
a case involving the
Civil Rights Attorney’s Fees Awards
Act.) The district court granted Wal-
Mart’s request for attorney’s fees, but
reduced the award to $810,00. This
appeal followed.
Qore asks us to vacate the district
court’s fee award on three grounds.
First, it argues that the indemnity
provision at issue does not apply in
this first-party dispute between Wal-
Mart and Qore, but is instead limited
to claims brought against Wal-Mart by
third parties. Second, Qore claims that
Mississippi law precludes an award
of attorney’s fees because Wal-Mart
did not present competent evidence
by which to allocate its fee request
between successful and unsuccessful
claims. Third, Qore maintains that the
district court erred in holding it liable
for the entirety of Wal-Mart’s attor-
ney’s fees for all matters related to this
litigation. We note that Qore’s second
and third assignments of error pres-
ent the same basic question: whether,
under the facts presented here, Wal-
Mart’s recovery of attorney’s fees
should be limited to those claims upon
which it prevailed against Qore at
trial.
In conducting our review, we examine
the record independently and under the
same standards that guided the district
court. This broad standard of review
includes the initial determination of
whether the contract is ambiguous.
Qore contends that the indemnity
provision in the testing and inspec-
tion contract only applies to actions
brought against Wal-Mart by indepen-
dent third parties. Relying on com-
mon law indemnity rules, Qore argues
that the provision does not authorize
an award of attorney’s fees in this
first-party dispute between Wal-Mart
and Qore. In response, Wal-Mart
maintains that the plain language of
the indemnity provision provides
for those attorney’s fees incurred in
any case, whether brought by one of
the contracting parties or otherwise,
to the extent that Qore’s negligence
precipitated the underlying suit. The
district court applied a plain reading
of the testing and inspection contract
and found that, as a threshold matter,
it allowed for recovery of Wal-Mart’s
reasonable attorney’s fees. We agree.
The testing and inspection contract’s
plain language allowed for recovery of
attorney’s fees.
Next, Qore contends that in light of
Wal-Mart’s multiple claims against