Hooksett Sewer Commission v. Penta Corp., 082216 NHSUP, 217-2013-CV-54

Docket Nº:217-2013-CV-54
Opinion Judge:Richard B. McNamara, Presiding Justice
Party Name:Hooksett Sewer Commission v. Penta Corporation, I. Kruger, Inc. d/b/a Kruger, Inc. and Graves Engineering, Inc.
Case Date:August 22, 2016
Court:Superior Court of New Hampshire
 
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Hooksett Sewer Commission

v.

Penta Corporation, I. Kruger, Inc. d/b/a Kruger, Inc. and Graves Engineering, Inc.

No. 217-2013-CV-54

Superior Court of New Hampshire

August 22, 2016

NOT FOR PUBLICATION

MERRIMACK SS

ORDER

Richard B. McNamara, Presiding Justice

Plaintiff Hooksett Sewer Commission ("Hooksett") brought this action against the Defendants, Penta Corporation ("Penta"), I. Kruger, Incorporated d/b/a Kruger Incorporated ("Kruger"), and Graves Engineering, Incorporated ("Graves Engineering"), asserting various claims, including breach of contract, negligence, and breach of the implied warranty of fitness for a particular purpose. The action arises from the failure of the Plaintiff's wastewater treatment facility in March of 2011. Four motions are before the Court: (1) Stantec Consulting Services, Inc. ("Stantec") moves for summary judgment on Kruger's third-party contribution claim against it; (2) Richardson Electric Co., Inc. ("Richardson") also moves for summary judgment on Kruger's third-party contribution claim against it; (3) Penta moves to dismiss Hooksett's Count II for breach of contract; and (4) Hooksett moves to amend its Complaint. For the following reasons, Stantec's Motion for Summary Judgment is DENIED; Richardson's Motion for Summary Judgment is DENIED; Penta's Motion to Dismiss Count II is DENIED; and Hooksett's Motion to Amend is GRANTED IN PART AND DENIED IN PART.

I

To prevail on a motion for summary judgment, the moving party must "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." RSA 491:8-a, III. In order to defeat summary judgment, the non-moving party "must put forth contradictory evidence under oath, sufficient . . . to indicate that a genuine issue of fact exists so that the party should have the opportunity to prove the fact at trial . . . ." Phillips v. Verax, 138 N.H. 240, 243 (1994) (citations and quotations omitted). A fact is material if it affects the outcome of the litigation under the applicable substantive law. Palmer v. Nan King Rest., Inc., 147 N.H. 681, 683 (2002). In considering a party's motion for summary judgment, the evidence must be considered in the light most favorable to the non-moving party, together with all reasonable inferences therefrom. Sintros v. Hamon, 148 N.H. 478, 480 (2002). The background facts as set forth in this Court's August 12, 2015 order, are not in dispute: Before 2010, Hooksett owned and operated a wastewater treatment facility in Hooksett, New Hampshire capable of treating 1.1 million gallons of wastewater per day. To help accommodate projected population and development growth, Hooksett hired Penta and Kruger1 to construct a system capable of treating 2.2 million gallons of wastewater per day.

Given the geographic restraints associated with the existing facility, Hooksett could not install additional tanks for treatment and processing. Thus, to accommodate for the expansion of Hooksett's treatment capacity, Kruger recommended that Hooksett utilize an Integrated Fixed Film Activated Sludge ("IFAS") system, coupled with a small disc called an "M-Chip, " in order to process the desired amount of wastewater while still maintaining permit loadings and achieving certain design specifications. Notably, the IFAS system would allow Hooksett to maintain the existing infrastructure without installing more tankage but would also allow Hooksett to increase its treatment capacity.

Relying on Kruger's representations, Hooksett commissioned Graves Engineering to design the expansion of its wastewater treatment facility based on Kruger's IFAS system or a comparable system. Graves Engineering's final design, entitled the "Phase 2A Capital Improvements, " represented that an "IFAS biological process shall help increase the nitrification capacity of the existing activated sludge tanks to obtain an effluent quality of less than 1.0 mg/l NH3-N at 10° C." The final design also states that "[t]he process shall not require additional aeration tank volume to achieve the anticipated secondary effluent characteristics at the design flow." Additionally, the final design represented that it would be able to treat 2.2 million gallons of wastewater per day. The final design incorporated many of Kruger's recommendations. Indeed, the final design provides: "The design is based on the [Kruger] IFAS process. Approved equals will be accepted provided that the equipment is at least of equal or better quality, function and performance, and can meet the design requirements without requiring additional aeration tank volume."

Hooksett accepted bids for the project on October 23, 2009. Following the bidding process, Penta was awarded the contract and subsequently signed an agreement to construct the Phase 2A Capital Improvements. On November 10, 2009, Penta submitted a purchase order for the Kruger IFAS system, which cost $1, 597, 000. The cost included millions of M-Chips used in the system. Additionally, Penta needed to purchase other commercial products to install the IFAS system, such as industrial blowers, vents, valves, hydronic piping, and screens. The estimated cost for these materials was $3, 191, 575.

Hooksett Sewer Commission v. Penta Corp., et al., Merrimack County Superior Ct. No. 13-CV-540, *2-4 (August 12, 2015) (Order, McNamara, J.) (internal citations omitted).

On November 22, 2010, the tanks containing the IFAS system experienced a small-scale flooding failure while staff was on site. (*3-4.) After this event, Stantec was asked to provide a design for a high-water alarm system to be installed in the IFAS tanks to prevent a future flooding failure. (*3-4.) Richardson physically installed the alarm by March 3, 2011, but it was not connected to the SCADA (supervisory control and data acquisition) system and rendered functional by LCS Controls ("LCS") until March 11, 2011. (*3-4.)

In March 2011, the IFAS system failed. Hooksett Sewer Commission, supra, *4. As a result of this failure, the Plaintiff filed suit against Penta, Kruger, and Graves Engineering. Kruger then sued Stantec and Richardson as a third-party plaintiff, claiming that both third-party defendants were in some way responsible for all or part of Kruger's liability in the original action. Both Stantec and Richardson now move for summary judgment on all Kruger's claims in the third party action.

A

Stantec moves for summary judgment against Kruger arguing that it had no responsibility to review the project goals of 2.2 million gallons per day ("MGD") and 2.0 peaking factor, it was not involved in the engineering of the wastewater process itself, and that it was not involved in writing the specifications for the IFAS system. (Stantec's Mot. Summ. J. 1, 2.) Kruger argues that Stantec was negligent in not including a high-water alarm on the IFAS tanks in the scope of its design of the "Instrumentation and Controls" for the Hooksett facility, and that it assumed duties which exceeded the scope of its contractual duties and could therefore be held liable for other parts of the facility's process. (Kruger's Obj. to Stantec's Mot. Summ. J, 1, 5-8.)

The parties do not dispute the following facts. Having a functioning alarm on the aeration tank containing the IFAS system would have prevented or mitigated the failure that occurred on March 6-7, 2011. (Hawkins Aff, Mar. 4. 2016, Ex. 3, p. 7-8.) When Stantec was asked to provide a design for an alarm system after the November 22, 2010 incident, it did so by December 23, 2010. (McCraw Aff., Apr. 4, 2016, Ex. 9; Calabro Dep., Dec. 15, 2015, 66:4-69:16.) After Stantec provided that design to Graves, the alarm system was not ordered, installed, and activated in time to prevent the March 6-7, 2011 facility failure...

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