Rissler & McMurry Co. v. Sheridan Area Water Supply Joint Powers Bd.
| Decision Date | 20 December 1996 |
| Docket Number | No. 95-227,95-227 |
| Parties | RISSLER & McMURRY CO., a Wyoming Corporation, Appellant (Plaintiff), v. SHERIDAN AREA WATER SUPPLY JOINT POWERS BOARD; and HKM Associates, a Montana Corporation, Appellees (Defendants). |
| Court | Wyoming Supreme Court |
Donald J. Rissler and John R. Hursh of Central Wyoming Law Associates, P.C., Riverton, for Appellant.
Virgil G. Kinnaird of Northern Wyoming Law Associates, Sheridan, for Appellee Sheridan Area Water Supply Joint Powers Board.
Tom C. Toner of Yonkee & Toner, Sheridan, for Appellee HKM Associates.
Before TAYLOR, C.J., and THOMAS, MACY, GOLDEN, * and LEHMAN, JJ.
Rissler & McMurry Company (Rissler) appeals summary judgment granted in favor of the Sheridan Area Water Supply Joint Powers Board (the Board) and HKM Associates (HKM), the engineer, in a dispute over the contract price for construction of a water distribution system in Sheridan County, Wyoming (the Project). When the Board denied Rissler's claim for an increase in contract price and extension of time after completion of the Project, Rissler sued the Board under contract theories. Rissler later added HKM as a defendant, claiming HKM was negligent in providing the plans and specifications for the Project. The district court granted summary We affirm.
judgment in favor of the Board on Rissler's contract claims because Rissler failed to comply with the written notification requirements of the contract. The district court separately granted summary judgment in favor of HKM on Rissler's negligence claims because Rissler sought purely economic damages and the duty owed by HKM to Rissler, if any, arose solely from the contract between the Board and Rissler.
The issues presented by Rissler in its initial brief are:
ISSUE I
Did the court error as a matter of law when it granted summary judgment to appellee Sheridan Area Water Supply Joint Power Board for the reason that:
A. Appellant had a cause of action for breach of implied warranty for defective plans and specifications; and
B. Appellant presented a genuine issue of material fact that appellee had waived the written notice provisions of the contract by subsequent course of conduct.
Did the court error as a matter of law when it granted summary judgment in favor of co-appellee HKM for the reason that the Wyoming law of torts does not preclude actions for economic damages suffered by a contractor as a result of defective engineering plans and specifications?
In response, the Board articulates the issues as follows:
A. Did the District Court err, in granting Summary Judgment to JPB [Sheridan Area Water Supply Joint Powers Board], by reason of the existence of an implied warranty of sufficiency of plans and specifications?
B. Was there a genuine issue of material fact as to whether the Appellant and JPB had, by course of conduct, waived provisions of a written construction contract?
HKM presents the following issues for consideration:
Interference with Contract Claim
1. Did the District Court correctly rule that the Board did not breach its construction contract with Rissler and, therefore, HKM did not induce any breach?
2. Can Rissler as a general contractor pursue a tort claim against HKM as the engineer to recover purely economic damages?
3. Did HKM owe a duty to protect the economic interests of Rissler, a nonclient?
4. Did Rissler contractually agree that HKM would have no liability except for failure to act in good faith thus barring Rissler's claims for negligence and negligent misrepresentation?
5. Did HKM misrepresent an "existing fact" to Rissler?
6. Could Rissler justifiably rely on the plans and specifications to show all underground utilities?
7. Was Rissler paid in full for all damages and delays associated with unlocated underground utilities?
8. Should negligence misrepresentation claims be recognized in the context of detailed construction contracts?
On its second bite at the apple, Rissler rephrases and presents these issues:
I. Did the court err when it ruled appellant had no claim for interference with contract?
II. Did the court err when it ruled that the economic loss doctrine bared [sic] appellant's claim of negligence against the engineer?
III. Are genuine issues of material fact raised in regard to appellant's negligent misrepresentation claim?
IV. Are genuine issues of material fact raised in regard to appellant's claim SJPB [Sheridan Area Water Supply Joint Powers Board] waived the notice provisions of the contract by subsequent course of dealings?
V. Do specific notice provisions of the contract nevertheless bar appellant's claim for breach of contract and implied warranty against the owner?
II. FACTS
During the summer of 1992, the Board advertised for bids for the construction of a water distribution system to serve the Little Goose Valley, Big Horn and the City of Sheridan. Prior to the bidding, the Board contracted with HKM for the design and preparation of site plans to be used in the bidding process and during construction. Rissler submitted the low bid and was awarded the contract. Rissler and the Board proceeded to negotiate a detailed construction contract which incorporated the plans and specifications provided by HKM and identified HKM as the engineer referred to throughout the contract. The job was to be completed within 270 days once notice to proceed was given. The duties and responsibilities of the parties were set forth in detail, including several provisions which required written notice of claims for an adjustment to the terms of the contract. These provisions, as they are relevant to this case, will be presented in detail in our discussion.
On November 2, 1992, Rissler was given notice to proceed. As construction ensued, Rissler quickly encountered several problems. By November 13, 1992, water began to appear in the trenches and, by the end of November, it was apparent to Rissler's supervisor that the bedding material required by HKM's specifications would not support the pipe in high ground water areas. Rissler's supervisor verbally complained about these conditions to HKM and believed that his complaints were memorialized in notes kept by HKM during the weekly project meetings. Rissler informed HKM that it believed rock was necessary to provide proper support, but HKM did not agree to deviate from the original specifications. Rissler was also frustrated by the inaccuracy of the utility locations as represented on the original plans, necessitating additional time and costs in determining the actual locations and completing any repairs resulting from unexpected encounters with underground facilities. However, Rissler did not submit any written complaints or claims regarding these problems during construction of the Project.
By the end of April 1993, all the waterlines had been fully laid and buried. Testing of the pipeline, which began in April 1993 and continued through August 1993, revealed numerous leaks allegedly caused by movement of the pipe due to the lack of support provided by the materials specified in HKM's design. Rissler completed the repairs, placing rock in several areas to provide additional support to the pipe. All leaks were identified and repaired by August 10, 1993, and Rissler "was finished by August 11." Substantial completion of the Project was designated as September 18, 1993.
On September 16, 1993, Rissler delivered a letter to HKM entitled "Notification of Claim per Article 11 of the General Conditions of the Contract." Four months later, on January 17, 1994, Rissler and the Board signed a Change Order which, under its terms, included any adjustment to the contract. Almost two months after signing the Change Order, Rissler delivered documents entitled "Claim for Change in Contract Price and Time" dated March 1, 1994 which contained justifications for an increase in the contract price and an adjustment of the time needed to complete the Project. On September 16, 1994, the Board formally denied the claim without comment.
Rissler filed suit against the Board on October 11, 1994, alleging negligence in the provision of engineering plans and design, breach of implied warranty, and breach of contract. The Board timely responded and proceeded to file a motion for summary judgment contending that Rissler's failure to follow the written claims procedures barred claims on the contract and that the Wyoming Governmental Claims Act barred all of Rissler's tort claims. Rissler then filed an amended complaint naming both the Board and HKM as defendants. In its amended complaint, Rissler alleged three causes of action against the Board: breach of contract; breach of contractual duty not to interfere and breach of implied warranty of plans and specifications. Rissler alleged the same claims against HKM and, in addition, alleged negligent misrepresentation, negligence, and tortious interference with contractual relations. After answering the amended complaint, the Board supplemented its earlier motion for summary judgment with additional affidavits and briefing. On April 13, 1995, the district court granted the Board's motion for summary judgment ruling that Rissler failed to give timely notice as required by the contract.
HKM then made its own bid for summary judgment. While HKM's motion was pending, the parties moved to dismiss the contract claims against HKM, which motion was granted by the district court. The district court granted summary judgment in favor of HKM on the remaining claims on June 1, 1995. Rissler now appeals both summary judgment orders.
Summary judgment is properly granted only where there is no genuine issue of material fact and the prevailing party is entitled to judgment as a matter of law. Emmett Ranch, Inc. v. Goldmark Engineering, Inc., 908 P.2d 941, 944 (Wyo.1995). When...
To continue reading
Request your trial
-
Foremost Ins. Co. v. Parham
...Inc., 170 Wis.2d 622, 489 N.W.2d 697 (Wis.App.1992), review denied, 494 N.W.2d 210 (Wis.1992); Rissler & McMurry Co. v. Sheridan Area Water Supply Joint Powers Board, 929 P.2d 1228 (Wyo.1996). ...
-
United States Aviation Underwriters v. Dassault
...discovery. Continental Ins. Co. v. Page Engineering Co., 783 P.2d at 647-649. The opinion in Rissler & McMurry Co. v. Sheridan Area Water Supply Joint Powers Bd., 929 P.2d 1228 (Wyo.1996), also speaks to the economic loss doctrine. In Rissler, the Wyoming Supreme Court We now turn to Rissle......
-
SME Indus., Inc. v. Thompson, Ventulett, Stainback & Assocs.
...S.E.2d 724, 727 (1987) (same); Berschauer/Phillips Constr. Co., 881 P.2d at 992 (same); Rissler & McMurry Co. v. Sheridan Area Water Supply Joint Powers Bd., 929 P.2d 1228, 1235 (Wyo.1996) ¶ 38 Therefore, consistent with our prior analysis in American Towers, and the foregoing authority fro......
-
Balfour Beatty Infrastructure, Inc. v. Rummel Klepper & Kahl, LLP
...purely economic damages in tort from a design professional."); Rissler & McMurry Co. v. Sheridan Area Water Supply Joint Powers Bd. , 929 P.2d 1228, 1235 (Wyo. 1996) (economic loss doctrine barred Restatement (Second) of Torts § 552 claim by contractor against engineer); see also Marc Schne......
-
Claims and Disputes Against a State or Local Government Owner: What Construction Attorneys Should Know
...Town’s liquidated damages assessment in a town council meeting); Rissler & McMurry Co. v. Sheridan Area Water Supply Joint Powers Bd., 929 P.2d 1228, 1234 (Wyo. 1996) (owner did not waive notice requirements by using ield directives and issuing prior change orders based on verbal notice); s......