Cave Construction, Inc. v. United States, 9259.

• Decision Date: 11 December 1967
• Docket Number: No. 9259.,9259.
• Citation: 387 F.2d 760
• Parties: CAVE CONSTRUCTION, INC., a corporation, Appellant, v. UNITED STATES of America, Suing herein for the Use and Benefit of ANGELL BROS, INC., a corporation, Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

387 F.2d 760 (1967)

CAVE CONSTRUCTION, INC., a corporation, Appellant, v. UNITED STATES of America, Suing herein for the Use and Benefit of ANGELL BROS, INC., a corporation, Appellee.

No. 9259.

United States Court of Appeals Tenth Circuit.

December 11, 1967.

James P. Horiskey Cheyenne, Wyo., and Leo Graybill, Jr., Great Falls, Mont. for appellant.

Cresap S. McCracken, Great Falls, Mont., and James C. Wilson, Cheyenne, Wyo., for appellee.

Before MURRAH, Chief Judge, and JONES^* and HILL, Circuit Judges.

MURRAH, Chief Judge.

Defendant-Appellant Cave Construction, Inc., appeals from a Miller Act judgment in favor of its subcontractor, plaintiff-appellee Angell Bros., Inc., for sums due for the substantial performance of the subcontract.

The basic and undisputed facts are that Cave Construction contracted with the United States to furnish labor, materials and equipment and perform certain "dredging" and bulkheading in the Grant Village "Lagoon" and "Marina" areas, Yellowstone National Park. Included as a part of the contract was a "Rock Addendum" warning of existing rock conditions on the jobsites. Cave commenced its dredging operations at the Lagoon area using a rented, homemade dredge. After encountering considerable difficulty with the homemade dredge, it subcontracted the dredging work at both sites to Angell Bros. who at that time was purchasing a portable hydraulic dredge. By the terms of the subcontract, Angell agreed "to furnish all materials, labor, tools, equipment, services and supplies and to fully construct, perform and in every respect complete all work set forth in Section 2 hereof, in the construction of Marina Dredging and Bulkheading at Grant Village * * * in accordance with the terms and provisions of the contract between the United States and Cave * * * including all the general and special conditions * * * and other documents and addenda thereto * * *." Section 2 provided for the cubic yardage and unit price for "Dredging — wet excavation" and the lump sum of $1,100 to be paid for moving Angell's equipment in and out of Yellowstone National Park. Angell was not, however, shown the Rock Addendum crucial to the prime contract.

Angell moved its hydraulic dredge onto the jobsite and completed the dredging at the Lagoon area without incident. It then commenced dredging the Marina area where it encountered rock formations "undredgable" with its hydraulic dredge. Under the provisions of the prime contract, a claim for allegedly "changed conditions" due to unanticipated rock formations was filed by Cave and subsequently denied by the Government. Angell removed its dredge from the jobsite and commenced work on an unrelated contract. It then brought this suit to recover for the work it had performed for Cave and the cost of moving its dredge.

It is, of course, indisputable that if Angell agreed to perform an integral part of the prime contract in accordance with its terms and provisions, no amount of unforeseen hardship will excuse its performance. See Steenberg Construction Co. v. Prepakt Concrete Co., 10 Cir., 381 F.2d 768. The primary issue here is whether Angell did so agree, or whether it agreed to do only such dredging as it could perform with its hydraulic dredge.

As an aid in interpreting the subcontract, Judge Kerr considered the conduct of the parties and the surrounding circumstances at the time of the agreement. On the basis of this evidence he concluded that Angell had no knowledge of the prime contract Rock Addendum and that the addendum was not a part of the subcontract; that Angell agreed to do only such dredging as it could perform with its portable hydraulic dredge and this did not contemplate removing hard rock formations; that Angell "substantially performed its subcontract with Cave and is entitled to recover * * * for the balance due it for material dredged at the contract price * * * for move-in costs * * *" and for other miscellaneous expenses.

On appeal Cave first contends that the subcontract is clear and unambiguous in its terms and provisions and that the trial judge, therefore, erroneously permitted extrinsic evidence to influence his interpretation. See Flora Construction Company v. Bridger Valley Electric Association, Inc., Wyo., 355 P.2d 884.

In the interpretation of contracts the primary function of the judge is to ascertain and effectuate the intention of the parties. See Socony Mobil Oil Company, Inc., a New York Corp., v. Humble Oil & Refining Company, a Delaware Corp. (substituted for Wasatch Development Company, a Colorado Corporation), 10 Cir., 1967, 387 F.2d 155. If, in the judgment of the court, the contract, when considered by the whole of its parts, clearly and unmistakably expresses the intention of the parties, extrinsic inquiry is unwarranted. See The Colorado Milling & Elevator Co., a Corp., v. Chicago, Rock Island & Pacific Railroad Co., a Corp., 10 Cir., 1967, 382 F.2d 834; and see Homestake-Sapin Partners v. United States, 10 Cir., 375 F.2d 507. But, contracts are not made in a vacuum, nor with an eye to the dictionary. Rather, the parties usually contract in the environment in which they are brought together and the words they use to express their intentions are of the...