C&C Plumbing & Heating, LLP v. Williams Cnty.

Citation848 N.W.2d 709,2014 ND 128
Decision Date17 July 2014
Docket NumberNo. 20130297.,20130297.
CourtUnited States State Supreme Court of North Dakota
PartiesC & C PLUMBING AND HEATING, LLP, Plaintiff v. WILLIAMS COUNTY, North Dakota, Defendant, Third–Party Plaintiff, and Appellee v. American General Contractors, Inc., Third–Party Defendant, Fourth–Party Plaintiff, and Appellant v. Davis Masonry, Inc., Fourth–Party Defendant, Fifth–Party Plaintiff, and Appellee v. Parsons Commercial Technology Group, Inc., Fifth–Party Defendant and Appellee.

OPINION TEXT STARTS HERE

Collin P. Dobrovolny, Minot, N.D., for fourth-party defendant, fifth-party plaintiff and appellee Davis Masonry, Inc.

Charles L. Neff, Williston, N.D., for defendant, third-party plaintiff, and appellee Williams County, North Dakota.

Kip M. Kaler, Fargo, N.D., for third-party defendant, fourth-party plaintiff, and appellant.

McEVERS, Justice.

[¶ 1] American General Contractors, Inc. (AGC), appeals from a judgment assessing liability and awarding damages and interest for the cost of delays in the construction of the Williams County Law Enforcement Center in Williston. Because AGC has not convinced us that the district court's findings of fact are clearly erroneous or that the court misapplied the law, we affirm.

I

[¶ 2] In 2006, the Williams County Board of County Commissioners (County) decided to construct a new law enforcement center and entered into a construction management contract with a firm that was subsequently acquired by Parsons Commercial Technology Group, Inc. (Parsons). Parsons solicited bids for 28 prime contracts, and AGC was awarded five prime contracts for a total bid of $3,666,400: (1) building and site concrete; (2) masonry; (3) steel erection; (4) general trades/carpentry; and (5) drywall and plaster. AGC entered into a subcontract with Davis Masonry, Inc. (Davis), for the masonry work on the building and with Arnco Diversified, Inc. (“Arnco”), for the steel erection. Each of the County's contracts with the prime contractors contained a “Milestone Schedule” which listed April 2, 2007, as the date for “Start of Construction/Mobilization”; August 15, 2007, as the date for “Building Enclosure and Roofing”; and June 30, 2008, as the date for “Substantial Completion.” However, delays with the construction project quickly ensued. Building enclosure and roofing was not achieved until February 15, 2008, and substantial completion was not accomplished until February 19, 2009, about seven and one-half months after the milestone schedule date for substantial completion.

[¶ 3] C & C Plumbing and Heating, LLP (C & C), the successful bidder for the mechanical prime contract, brought this action against the County for additional costs incurred as a result of the delay. The County brought a third-party complaint against AGC, which in turn counterclaimed against the County and brought a fourth-party action against its subcontractor, Davis. Davis counterclaimed against AGC and brought a fifth-party action against Parsons. The district court dismissed the fifth-party action against Parsons on summary judgment and held a bench trial on the remaining claims between the parties.

[¶ 4] In a 94–page opinion, the district court found that the first four months of the delay was attributable to causes “inherent in the construction industry.” The court found the remaining three and one-half months of delay was “largely attributable” to the County, through its agent Parsons, for “active interference” with its contractors. The court concluded it was appropriate for the County and AGC to share responsibility for providing temporary shelter and heat on the project. The court apportioned 47 percent of the liability for the costs of the delay for the three and one-half months of active interference to the County and 53 percent to AGC, for the four months delay inherent to the industry. The court awarded C & C approximately $73,000 on its claim against the County. After offsetting amounts owed between the parties, the court awarded AGC approximately $424,000 on its claim against the County. The court awarded Davis approximately $96,000 from AGC for masonry work completed under its subcontract with AGC, and rejected AGC's claimed offsets to that amount. Davis had provided heat, cover and shelter for the project during cold weather and sought $649,000 from the County and AGC for that expense including prompt payment interest. Davis had settled with the County for $530,000, and the court ruled AGC was responsible for 53 percent of the remaining $119,000, or $63,070.

II

[¶ 5] AGC argues the district court made several errors of law and fact in its decision.

[¶ 6] Our standard of review of a bench trial is well-established:

In an appeal from a bench trial, the trial court's findings of fact are reviewed under the clearly erroneous standard of N.D.R.Civ.P. 52(a) and its conclusions of law are fully reviewable. A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if there is no evidence to support it, or if, after reviewing all the evidence, we are left with a definite and firm conviction a mistake has been made. In a bench trial, the trial court is the determiner of credibility issues and we do not second-guess the trial court on its credibility determinations.

Trosen v. Trosen, 2014 ND 7, ¶ 20, 841 N.W.2d 687 (quoting Niles v. Eldridge, 2013 ND 52, ¶ 6, 828 N.W.2d 521).

A

[¶ 7] AGC argues the district court erred in determining AGC was liable for any of the costs incurred from the delay under its contract with the County.

[¶ 8] Each of the “AIA” contracts between the County and the contractors, including AGC, provided in relevant part:

§ 6.2.3 Costs caused by delays or by improperly timed activities or defective construction shall be borne by the party responsible therefor.

....

§ 8.2.1 Time limits stated in the Contract Documents are of the essence of the Contract. By executing the Agreement the Contractor confirms that the Contract Time is a reasonable period for performing the Work.

....

§ 8.3.1 If the Contractor is delayed at any time in progress of the Work by an act or neglect of the Owner's own forces, Construction Manager, Architect, any of the other Contractors or an employee of any of them, or by changes ordered in the Work, or by labor disputes, fire, unusual delay in deliveries, unavoidable casualties or other causes beyond the Contractor's control, or by delay authorized by the Owner pending arbitration, or by other causes which the Architect, based on the recommendation of the Construction Manager, determines may justify delay, then the Contract Time shall be extended by Change Order for such reasonable time as the Architect may determine.

....

17.2.1 It is the Owner's intent to complete the Project as soon as possible, and in this pursuit the Owner may coordinate the scheduling function. The Contractor agrees to cooperate in scheduling and performing the Work to achieve completion of the Project as soon as possible.

17.2.2 The Contractor acknowledges and accepts the prospects of such delays, interferences and interruptions to the progress of the Project and to the Work as are inherent in the construction industry.The Contractor represents that they have included compensation for such delays, interferences and interruptions in the Contract Sum.

17.2.3 The Owner does not guarantee that delays, interferences and/or interruptions to the Work will not occur. The Owner expressly disclaims any responsibilities or obligations resulting from delays, interferences or interruptions.

17.2.4 The Contractor shall not be entitled to additional compensation or damages due to delays, interferences or interruptions to the Work or the Project, but shall be entitled only to an appropriate extension of time in accord with the General Conditions of the Contract for Construction.

....

18.1.2 The Work to be performed under this Contract shall be commenced immediately and be completed in accordance with the milestone schedule and the subsequent construction schedule incorporating scheduling input from the Contractors on the Project. Contractor agrees to complete its Work in accordance with the construction schedule as updated from time to time, and specifically in accordance with day-to-day schedule input submitted to the Construction Manager by the Contractor and accepted by the Construction Manager for incorporation in the construction schedule. It is expressly understood and agreed that upon request by the Construction Manager the Contractor shall adjust its individual scheduled activities to allow coordination of the Project Work, to achieve established milestone dates or to allow completion of the Project in an expeditious manner, all without additional compensation to the Contractor or damages of any kind.

18.1.3 The Construction Manager will provide a Milestone Schedule which will establish the major points of completion during construction, and toward which Contractors shall orient their efforts.

(Emphasis added).

[¶ 9] AGC argues the “no damages for delay” clause creates an ambiguity in the contract when considered in conjunction with the milestone schedule and the clause requiring costs caused by delays to be “borne by the party responsible.” AGC contends the County should be held entirely responsible for costs incurred by the delay because it breached the contract by failing to meet its milestone date for building enclosure.

[¶ 10] The district court concluded this Court's decision in Markwed Excavating, Inc. v. City of Mandan, 2010 ND 220, 791 N.W.2d 22, was controlling. In Markwed, we held that a no damages for delay clause, similar to section 17.2.4 of the contract here, unambiguously insulated the city from liability to a contractor for uncontemplated delays in the performance of the contractor's work, even though the construction contract also included a time is of the essence clause. Id. at ¶¶ 19–20. This Court reasoned:

[O]ur statutes reflect a preference for...

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    ...‘is the amount which will compensate the party aggrieved for all the detriment proximately caused thereby.’ " C & C Plumbing and Heating, LLP v. Williams County , 2014 ND 128, ¶ 25, 848 N.W.2d 709. "Our law ... incorporates the notion that contract damages should give the non-breaching part......
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    ...under the clearly erroneous standard and conclusions of law are fully reviewable. C & C Plumbing and Heating, LLP v. Williams County, 2014 ND 128, ¶ 6, 848 N.W.2d 709. “A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if there is no evidence to suppor......
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    ...if, after reviewing all the evidence, we are left with a definite and firm conviction a mistake has been made.” C & C Plumbing and Heating, LLP v. Williams Cnty., 2014 ND 128, ¶ 6, 848 N.W.2d 709 (quoting Trosen v. Trosen, 2014 ND 7, ¶ 20, 841 N.W.2d 687 ). In reviewing findings of fact, we......

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