Reid v. Berkowitz: Landowner Not Liable for Subcontractor Judgments

Rodney Tyler Reid was injured at a construction site after he fell through an unsecured guardrail. Daniel Berkowitz was the general contractor on the project. Steve Hernandez and Gonzalo Batuello worked on the site as subcontractors. After the fall, Reid brought suit against Berkowitz under the Colorado Premises Liability Act, which applied to landowners. Berkowitz answered the complaint, requested a jury trial, and designated Hernandez and Batuello as nonparties at fault.

Reid later amended the complaint. The amended pleading kept the premises liability claim against Berkowitz and added common law negligence claims against Hernandez and Batuello as named parties. The claim against Batuello sought indemnity, contribution, and liability. The claim against Hernandez focused on improper installation of the railing.

Hernandez and Batuello did not answer the amended complaint. The district court entered defaults against both of them. The court then held a bench hearing on damages. After that hearing, the court found that Reid’s total damages before interest were $832,783.20. That total included economic damages, future medical expenses, noneconomic damages, physical impairment, and disfigurement. At Reid’s request, the court allocated 80 percent of the liability to Batuello and 20 percent to Hernandez. The court then added simple interest at 9 percent per year and entered a default judgment of $844,308.92 against Batuello and a default judgment of $211,077.23 against Hernandez.

During the damages hearing, there was discussion about whether Berkowitz could later be held responsible for those default judgments. The opinion stated that the district court did not make a finding on that point at the time. Reid later moved to amend the complaint again so he could seek relief against Berkowitz for the subcontractors’ alleged negligence under a respondeat superior theory. The court allowed that amendment over Berkowitz’s objection. At the same time, the court stated that Berkowitz was not automatically bound by the earlier damages finding because that was a separate issue.

The jury trial against Berkowitz

The premises liability claim against Berkowitz went to a jury trial before a different judge. At Reid’s request, the default judgments against Hernandez and Batuello were not mentioned to the jurors. The respondeat superior claims were also not submitted to the jury. The jury returned a verdict awarding Reid $400,000 for noneconomic losses, economic losses, physical impairment, and disfigurement.

Berkowitz requested jury instructions that would have allowed the jury to apportion fault to the subcontractors and to evaluate Reid’s comparative negligence. The trial court did not give those instructions. Berkowitz appealed that judgment, and an earlier division of the Colorado Court of Appeals reviewed the case in a separate decision referred to in this opinion as Reid I.

In Reid I, the appellate court examined the verdict entered on the premises liability claim. The court concluded that the refusal to instruct the jury on apportionment was error, though it treated that error as harmless because the subcontractors’ fault was imputable to Berkowitz under the nondelegable duty imposed on a landowner by the Colorado Premises Liability Act. The court also determined that the trial court should have instructed the jury on Reid’s comparative negligence. It sent the case back for a retrial limited to fault allocation between Reid and Berkowitz.

A second jury later assigned 90 percent of the fault to Berkowitz and 10 percent to Reid. The original $400,000 judgment was reduced to reflect that allocation, and Berkowitz paid the amount due under that judgment.

The dispute over the default judgments

After the second jury completed the fault allocation, Reid asked the district court for declaratory relief. He requested a ruling that Berkowitz was liable under his nondelegable duty for 90 percent of the default judgments entered against Hernandez and Batuello, plus simple interest. Reid asked the court to enter judgment against Berkowitz in the amount of $1,169,821.22.

Berkowitz opposed that request. After a hearing, the district court ruled that Berkowitz was liable for the full amount of the default judgments and used compound interest in its calculation. That produced a total of $1,457,149.10.

Berkowitz appealed again. In this appeal, he raised several grounds for reversal. The court focused on whether Berkowitz could be held liable for the default judgments that had been entered against the subcontractors. The opinion stated that Berkowitz took the position that the Colorado Premises Liability Act provided the exclusive remedy against a landowner and that he could not be held liable both under that statute and also under common law negligence theories tied to the subcontractors’ defaults.

The court first addressed whether the issue had been preserved. Reid took the position that Berkowitz should have raised the issue in the earlier appeal. The court rejected that view. It explained that Reid I dealt with the judgment entered after the jury verdict on the premises liability claim and did not decide Berkowitz’s liability for the default judgments. The court noted that Berkowitz had opposed Reid’s motion for declaratory relief in the district court using the same position he raised on appeal, so the issue was preserved.

The appellate court’s analysis

The court then examined the language of the Colorado Premises Liability Act. It stated that the statute provided that in any civil action brought against a landowner by a person injured on the real property of another because of the condition of the property or activities conducted or circumstances existing on that property, the landowner would be liable only as provided in the statute. The court read that language as showing that the General Assembly intended the Act to provide the exclusive remedy against a landowner for injuries caused by conditions, activities, or circumstances on the property.

The opinion also reviewed prior Colorado decisions stating that the Act displaced common law negligence claims against landowners for those kinds of injuries. Based on that line of authority, the court concluded that Berkowitz could not be made liable at the same time for damages assessed under the Premises Liability Act and for separate common law negligence judgments entered against subcontractors.

The court then compared the nondelegable duty recognized under the Premises Liability Act with respondeat superior. It explained that the nondelegable duty doctrine burdened a landowner with full liability under the Act regardless of fault attributable to others, but that doctrine did not authorize a court to impose separate common law respondeat superior liability on the landowner for injuries arising from conditions, activities, or circumstances on the land. The court stated that the two concepts were not equivalent.

The opinion also addressed Reid’s view that the earlier appellate decision had already established Berkowitz’s liability for the subcontractors’ defaults. The court rejected that reading of Reid I. It explained that the earlier decision addressed the jury verdict on the premises liability claim and did not determine or apportion liability for the default judgments. Any discussion of those defaults in Reid I did not control the present issue.

The court also addressed Reid’s position that Berkowitz had invited the error. The opinion recounted the damages hearing on the default judgments, where the district court raised the subject of joint and several liability and apportionment of fault. Reid’s counsel told the court that there was no joint and several liability and stated that the default judgments could not be enforced against Berkowitz. After Reid testified, Berkowitz’s counsel asked how the judgment in that proceeding would apply to Berkowitz. The court stated that Berkowitz might be bound because his attorney was present, and Berkowitz’s attorney objected on the ground that Berkowitz had demanded a jury trial. The district court then deferred any ruling on that issue and later entered judgment only against the subcontractors.

The opinion also noted that when the case later went to trial against Berkowitz, Reid’s counsel sought to keep the default judgments from the jury and told the district court that those judgments were not collectible and that the subcontractors were not part of the case. The court further noted that Reid did not try to collect those default judgments from Berkowitz until nearly two years later, after the earlier appeal and before the retrial. Based on that sequence of events, the court concluded that the error was not invited by Berkowitz.

The court also rejected Reid’s public policy concerns. It stated that nothing in the opinion prevented a plaintiff from pleading multiple claims before it was determined whether a party qualified as a landowner under the statute.

Court’s decision

The Colorado Court of Appeals held that because Berkowitz was a landowner and the Colorado Premises Liability Act barred Reid’s common law negligence claims against a landowner, Berkowitz could not be held liable for the default judgments entered on the common law negligence claims against Batuello and Hernandez. The court reversed the judgment and orders and remanded the case to the district court with directions to vacate the judgments against Berkowitz.

Premises liability representation

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