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Homebuilder Beware: The Consequences of the Appellate Court’s Gaccione Holding

Any homeowner looking to build or modify a home should note that a new trend in New Jersey law now holds property owners liable for workplace injuries where the injury occurred on site, and the property owner assumed responsibilities normally reserved for a general contractor. This trend was solidified by the New Jersey Appellate Division case of Costa v. Gaccione, 408 N.J. Super. 362 (App. Div. 2009) where the Appellate Court held that since there was evidence to demonstrate a property owner on a construction project where Plaintiff was injured acted as the de facto general contractor, a genuine issues of material fact existed to warrant a trial on the property owner's liability for the Plaintiff's injuries.

In Costa, an employee of a framing subcontractor fell and sustained serious injury when climbing makeshift scaffolding used on the construction project. The employee claimed that the property owner, Salvatore Gaccione ("Gaccione"), acted as the project general contractor, and that Gaccione's failure to ensure worksite safety constituted negligence and a violation of OSHA. Regarding Gaccione's role as the general contractor, the employee demonstrated that Gaccione obtained building permits as the project owner, but indicated on the permit form that he considered himself the "person responsible for the work." In addition, Gaccione performed many of the general contractor functions on the project, such as hiring an architect and various subcontractors, scheduling subcontractors' work and purchasing building materials. Gaccione also frequented the jobsite, oversaw the work and performed some managerial tasks. Nevertheless, the trial court granted Gaccione's motion for summary judgment dismissing all claims against him. The trial court held that Gaccione did not have a duty to ascertain whether the scaffolding posed a risk of injury and, instead, was entitled to rely on the subcontractor to oversee its employee's work.

The employee then appealed to the Appellate Division. On appeal, the Appellate Division reversed the trial court's holding, and found the facts of the case established that the homeowner had acted as the de facto contractor. Significantly, the homeowner visited the site daily, oversaw operations, purchased materials requested by builders, and actively discussed building plans with workers that he hired. The Appellate Division concluded that this evidence was sufficient to create genuine issues of material facts and ordered a trial to determine the issue of damages.

The important lesson to be learned from the Costa case for perspective homebuilders is that taking on the responsibilities normally assumed of a general contractor, even in the absence of the official designation of such, may give rise to a duty of care to ensure worksite safety, and expose you to liability.