Wanzek Construction, Inc. v. Employers Insurance of Wausau

FORSBERG, Judge

(concurring in part, dissenting in part).

I concur with the majority opinion, but I respectfully dissent regarding the subcontractor issue. I believe Sterling Custom Homes Corp. v. Comm’r of Revenue, 391 N.W.2d 523 (Minn.1986), is on point and controlling. In Sterling, the supreme court defined the term “subcontractor.”

The terms contractor and subcontractor are not applicable to persons who merely sell tangible personal property in the form of budding materials, supplies, or equipment to construction contractors, for delivery at the job site without any requirement that they install such tangible personal property.

Id. at 524 (quoting Minn. R. 8130.1200, subp. 2(C) (1985)). Based on this limiting definition, the court held that Sterling was not a subcontractor because it only manufactured and delivered the building materials to the builder, but did not construct and install these custom home packages at the building site. Id. at 525.

Here, Aquatic Designs only delivered to Wanzek Construction the coping stones that it had manufactured, but did not install these coping stones at the budding site. Its act of supervising the installation did not tilt the scales so that Aquatic became a subcontractor. Its conduct is comparable to that of Sterling’s driver, who laid out the materials in the order that they were to be instaded. Under the binding Sterling precedent, this means that Aquatic is solely considered a materials supplier, not a subcontractor.

Although the majority concludes that cases involving mechanics’ liens, such as Weyerhaeuser Co. v. Twin City Millwork Co., 291 Minn. 293, 191 N.W.2d 401 (1971), are more analogous to this insurance case, I believe that the supreme court’s more recent definition of the term “subcontractor” must be controding. In addition, even though Sterling addressed a retail sales tax issue, I believe its subcontractor definition should be more broadly applied than to just tax cases. Thus, I would conclude that Aquatic was not a subcontractor and that Employer’s Insurance of Wausau’s policy did not cover Wanzek’s replacement costs.