Gravina Siding & Windows Co. v. Gravina

• Decision Date: 05 May 2022
• Docket Number: Court of Appeals No. 20CA1465
• Citation: 516 P.3d 37,2022 COA 50
• Parties: GRAVINA SIDING AND WINDOWS COMPANY, Plaintiff-Appellee and Cross-Appellant, v. Larry A. GRAVINA, Mike Gravina, and Jason Castro, Third-Party Defendants-Appellees, and Paul A. Frederiksen and Brenda J. Frederiksen, Defendants-Appellants and Cross-Appellees.
• Court: Colorado Court of Appeals

516 P.3d 37
2022 COA 50

GRAVINA SIDING AND WINDOWS COMPANY, Plaintiff-Appellee and Cross-Appellant,
v.
Larry A. GRAVINA, Mike Gravina, and Jason Castro, Third-Party Defendants-Appellees,
and
Paul A. Frederiksen and Brenda J. Frederiksen, Defendants-Appellants and Cross-Appellees.

Court of Appeals No. 20CA1465

Colorado Court of Appeals, Division I.

Announced May 5, 2022

Fischer & Fischer, P.C., Jennifer K. Fischer, Denver, Colorado, for Plaintiff-Appellee and Cross-Appellant

Overturf McGath & Hull, P.C., Scott A. McGath, Steven W. Boatright, Denver, Colorado, for Third-Party Defendants-Appellees

Frederiksen Law Office, Paul A. Frederiksen, Parker, Colorado, for Defendants-Appellants and Cross-Appellees

Opinion by JUDGE DAILEY

¶ 1 Defendants and third-party plaintiffs Paul A. Frederiksen and Brenda J. Frederiksen (the Frederiksens) appeal the trial

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court's entry of judgment in favor of plaintiff Gravina Siding and Windows, Co., and third-party defendants Larry A. Gravina, Mike Gravina, and Jason Castro (collectively, Gravina). Gravina cross-appeals from an unfavorable part of the trial court's judgment. We affirm in part, reverse in part, and remand with directions.

I. Background

¶ 2 For some years, the Frederiksens had to repair their cedar siding because woodpeckers damaged it by building nests and boring holes into it. On November 29, 2017, the Frederiksens entered into a contract with Gravina to replace the cedar siding of their home with steel siding in exchange for payments totaling $42,116.00. The Frederiksens put down $10,000 towards the contract price.

¶ 3 Gravina (1) told the Frederiksens that it could start work within ten to fourteen weeks of signing the contract and (2) estimated that the job would take up to four weeks to complete. The Frederiksens hoped to have the new siding put on the house before the woodpeckers arrived in the spring.

¶ 4 Gravina's subcontractors began work in late March 2018 and were not finished four-and-a-half months later when, on August 7, 2018, the Frederiksens received a bill from Gravina requesting final payment for the outstanding balance on the contract. Believing Gravina had repeatedly breached their agreement, the Frederiksens’ terminated the contract and denied Gravina and its subcontractors further access to their property.

¶ 5 Gravina filed the present action against the Frederiksens, alleging, as pertinent here, breach of contract, breach of the covenant of good faith and fair dealing, and unjust enrichment. The Frederiksens filed an answer as well as counterclaims against Gravina and third-party claims against Gravina's owner (Larry Gravina) and two employees (salesperson Mike Gravina and project supervisor Jason Castro). On Gravina's motion, the trial court dismissed all but, as pertinent here, the Frederiksens’ (1) breach of contract claim against Gravina and (2) negligent supervision claim against the three individual third-party defendants.

¶ 6 After conducting a three-day bench trial, the court found that Gravina had materially breached the contract and, that, consequently, the Frederiksens had properly terminated it. Nonetheless, the trial court ultimately (1) awarded Gravina a net judgment of $19,000 on its unjust enrichment claim¹ and (2) rejected the Frederiksens’ negligent supervision claim and request for attorney fees.

¶ 7 Both parties appeal.

¶ 8 On appeal, the Frederiksens contend that the trial court erred by (1) ruling that they had been unjustly enriched as a result of Gravina's efforts; (2) failing to award them damages for Gravina's breach of contract; (3) rejecting their negligent supervision claim against the individual third-party defendants; (4) excluding expert testimony related to the existence of roof damage and related repair costs; and (5) denying their request for attorney fees.

¶ 9 Gravina cross-appeals the trial court's ruling that it breached the contract, entitling the Frederiksens to terminate the contract and recover damages.

¶ 10 We address each contention, but we start with the issue raised in Gravina's cross-appeal before later addressing the parties’ respective recoveries.

II. Gravina's Cross-Appeal

¶ 11 Gravina contends that the trial court erred when it found that it materially breached the contract, allowing the Frederiksens to terminate the contract and recover damages. We disagree.

¶ 12 Upon a material breach of a contract, the injured party is "excuse[d from] further performance" and entitled to recover damages. Morris v. Belfor USA Grp., Inc. , 201 P.3d 1253, 1258 (Colo. App. 2008) ; see, e.g. , Blood v. Qwest Servs. Corp. , 224 P.3d 301, 324 (Colo. App. 2009) (recognizing a

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nonbreaching party may terminate a contract following a material breach), aff'd , 252 P.3d 1071 (Colo. 2011).

¶ 13 "Whether there has been a material breach of contract turns upon the importance or seriousness of the breach and the likelihood that the injured party nonetheless received, or will receive, substantial performance under the contract." Interbank Invs., L.L.C. v. Vail Valley Consol. Water Dist. , 12 P.3d 1224, 1228 (Colo. App. 2000) ; see Lawry v. Palm , 192 P.3d 550, 567 (Colo. App. 2008) ("A material term goes to the root of the matter or essence of the contract. Materiality must be assessed in the context of the expectations of the parties at the time the contract was formed.").

¶ 14 Whether a party has materially breached a contract is a question of fact, Interbank Invs., L.L.C. , 12 P.3d at 1229, and a court's determination of such a question may not be disturbed on appeal unless it is so clearly erroneous as to find no support in the record. See S. Ute Indian Tribe v. King Consol. Ditch Co. , 250 P.3d 1226, 1232 (Colo. 2011) (reviewing factual findings by trial court).

¶ 15 The trial court determined that Gravina materially breached the contract because "Gravina did not substantially perform the terms of the contract and the Frederiksens did not receive what they substantially contracted for."

¶ 16 The court found that the Frederiksens wanted new steel siding installed "to reduce maintenance on the house" and to eliminate their woodpecker problems. Thus, the Frederiksens "wanted the [new] siding installed prior to the arrival of the woodpeckers in the spring." The timeframes given by Gravina—starting work in February or March 2018, and taking a month to complete—were, the court found, "acceptable to the Frederiksens because [they] allowed the work to be completed prior to the woodpeckers nesting." And "[a]ssuming the maximum four week[s] for completion, as testified to by Brenda Frederiksen and Mike Gravina, the job should have been finished by April 23[, 2018]." But the project was not completed even as of August 7, 2018.

¶ 17 Further, Gravina hired three separate subcontractors, at different times, to install the siding. The first one—a single person operation—was on the job less than one week before he quit. And the court found that (1) the second subcontractor's crew did "unsatisfactory work, ... much of [which] had to be redone by [the third subcontractor/crew]"; and (2) the third subcontractor's crew, which was "on the job for over two months," neither completed the job,² nor complied with a product manual "regarding installation as [Gravina] had agreed."

¶ 18 The trial court's findings are supported by the record.

¶ 19 Gravina asserts that the court erred in finding it materially breached the contract by failing to timely complete the work. As Gravina points out, there is no time specified in the written contract for completing the work. Per the contract, the installation was to begin ten to fourteen weeks from the November 29, 2017, contract date—between February 7 and March 4, 2018—but no completion date or time estimate was mentioned.³

¶ 20 Nonetheless, the trial court correctly recognized that if a contract contains no explicit provision concerning the time for a party's performance of obligations, the party must perform within a "reasonable time" as determined by the circumstances of the case. See Shull v. Sexton , 154 Colo. 311, 317, 390 P.2d 313, 316 (1964) ; see also Ranta Constr. Inc. v. Anderson , 190 P.3d 835, 841 (Colo. App. 2008) (" ‘[I]n the absence of a specific time for performance in the contract, the law implies a reasonable time,’ measured by the circumstances of the case." (quoting Adams v. City of Westminster , 140 P.3d 8, 11 (Colo. App. 2005) )).

¶ 21 A reasonable time is "determined upon consideration of the subject matter

516 P.3d 44

of the contract, what was contemplated at the time the contact was made, and other surrounding circumstances." Hall v. Add-Ventures, Ltd. , 695 P.2d 1081, 1089 (Alaska 1985) (citing Shull , 154 Colo. at 316-17, 390 P.2d at 316 ).

¶ 22 The trial court heard evidence that (1) the parties entered a contract in late November 2017 stating that the project was to start as early as February 7, 2018, but no later than thirty days after March 4, 2018; (2) Mike Gravina had estimated that the job would take up to four weeks, a number confirmed as a reasonable estimate by Jason Castro and expert witnesses hired by each party; and (3) the Frederiksens hoped to finish the project in the spring.

¶ 23 Based on this evidence, we cannot disturb the court's conclusion that Gravina's completion of the project within a "reasonable time" of, say, a month (or, even by the end of spring) was a "material" term of the contract.

¶ 24 Nor will we disturb the trial court's conclusion that Gravina breached this term, given evidence that (1) Gravina started the project on March 23, 2018; (2) Gravina's first subcontractor quit within his first week on the job; (3) its second subcontractor started work near the originally estimated completion date, worked for another month, and only completed about thirty percent of the job, much of which was "unacceptable"; and (4) its third subcontractor began on June 4, 2018—about two months after the originally estimated completion date—and by August 7, two months...