Charles H. Sells, Inc. v. New York State Thruway Authority

• Decision Date: 27 January 1964
• Docket Number: Nos. 37073,37075,s. 37073
• Citation: 246 N.Y.S.2d 718,41 Misc.2d 632
• Parties: CHARLES H. SELLS, INC., Claimant, v. NEW YORK STATE THRUWAY AUTHORITY, Defendant (two cases). Claim
• Court: New York Court of Claims

Page 718

246 N.Y.S.2d 718

41 Misc.2d 632

CHARLES H. SELLS, INC., Claimant, v. NEW YORK STATE THRUWAY AUTHORITY, Defendant (two cases).

Claim Nos. 37073, 37075.

Court of Claims, of New York.

Jan. 27, 1964.

Bleakley, Platt, Schmidt, Hart & Fritz, New York City, by John C. Marbach, New York City, of counsel, for claimant.

Louis J. Lefkowitz, Atty. Gen., by Gary M. Axenfeld, Asst. Atty. Gen., and Leonard H. Rubin, Deputy Asst. Atty. Gen., of counsel, for the State.

JOHN H. COOKE, Judge.

On the 26th day of September, 1955, the New York State Thruway Authority entered into an Engineering Agreement, H.C. 3559-A, with Charles H. Sells, Inc. The agreement provided for the supervision and inspection of the construction of a portion of the Erie Section of the Thruway and the contract to be supervised was E.T. 55-8, S.T. 55-10, R.C. 55.72; the contractor was Yonkers Contracting Co., Inc.

The agreement with the claimant was negotiated and not a bid contract, with the Yonkers Contracting Co., Inc., contract available during the negotiations. The claimant was to perform the same functions that a State Engineer would perform. The Yonkers Contracting Co., Inc., contract was incorporated by reference into the claimant's agreement.

The engineering agreement provided that claimant was to receive 4 1/2% of the complete and final construction cost, excluding, however, costs of acquisition of right of ways, work performed by public utility companies and services performed by the New York State Thruway Authority. In accordance with the final tabulation by the New York State Thruway Authority, claimant was entitled to receive $17,056.14. Claimant contended that the New York State Thruway Authority had granted extensions to Yonkers Contracting Co., Inc. compelling it to expend additional time on the site at additional costs to it and seeks to recover $100,462.80.

Claimant refused payment of $17,056.14, since it would be required to sign a waiver releasing the New York State Thruway Authority. After the claim was filed, a severance motion was made by claimant and a Judgment granted reserving the question of the right to interest on the retained percentage for this trial.

The instant claim is for the additional services performed by the claimant due to extensions of time granted by the New York State Thruway Authority and the question of interest on the retained percentage. Claimant bases its claim for the additional services on the agreement itself, or, in the alternative, on the theory of quantum meruit.

Claim No. 37073, timely filed, has not been assigned or submitted to any other Court or Tribunal for audit or determination.

On the 10th day of January, 1956, the New York State Thruway Authority entered into an Engineering Agreement, H.C. 3606 A, with claimant, Charles H. Sells, Inc. This agreement provided for the supervision and inspection of a portion of the Erie Section of the Thruway. The contract, to be supervised, was E.T. 55-14, S.T. 55-16 and the contractor was Depew Paving Co., Inc.

The Depew Paving Co., Inc., contract was available to claimant during the negotiation of claimant's agreement. The construction contract was incorporated by reference into claimant's negotiated agreement. Here too, the claimant was to perform the same functions as a State Engineer and was to be compensated at the rate of 4 1/2% of the complete and final construction cost, excluding, however, costs of acquisition of right of ways, work performed by public utility companies and services performed by the New York State Thruway Authority. Final payment in the amount of $28,314.42, based upon the computation by the New York State Thruway Authority, was not accepted by claimant since claimant refused to sign a waiver releasing the New York State Thruway Authority. Subsequent to filing this claim, claimant moved for a severance Judgment, which was granted, reserving the question of interest on the retained percentages for determination at this trial.

Claimant contends that extensions, granted by the New York State Thruway Authority, required it to perform additional services for which it seeks to recover $122,819.92, based upon the terms of the agreement, or in the alternative, quantum meruit.

An additional claim, in the amount of $3,008.00, is made by claimant for additional work performed by it, alleging that it was furnished improper survey maps.

Claim No. 37075, timely filed, has not been assigned or submitted to any other Court or Tribunal for audit or determination.

Since both claims concern themselves with extra engineering charges, and interest on retained percentages, the Court, for purposes of brevity, had decided to discuss that portion of Claim No. 37075, with Claim No. 37073. The remaining damage claim contained in Claim No. 37075 for faulty staking and surveying will be discussed subsequently.

In considering these claims, the following provisions contained in the agreement are important:

'2. The Engineers shall provide to the satisfaction of the Chairman or his duly authorized representative, Engineering supervision and inspection services during the entire term of the contract as originally established and during such additional periods of time as may be covered by extensions of time granted thereunder, until the completion and final acceptance of the contract, as follows: * * *

'The foregoing services by the Engineers are to assure that the work of the Contractor conforms to the provisions of the Contract documents for the Contract, and the Engineers agree to perform these services.

'2.1 The Engineers shall take full charge of the supervision and inspection of the Contract and all instructions to the Contractor shall be given by or through the Engineers. The Engineers shall provide sufficient personnel as determined by the Chairman to adequately perform all requirements of this Agreement. The Engineers agree to use all resources at their command to see that the Contract completion date is met and to this end, but without limitation, they shall give constant attention to the adequacy of the Contractor's personnel and equipment and the availability of his necessary materials and supplies. Time is of the essence under the Contract and it is the Engineers' acknowledged responsibility, in the first instance, to prevent delays in the Contractor's construction and purchasing procedures as well as to prevent such progression of these procedures as might lead to delays. Situations incapable of disposition in the field shall be brought to the immediate attention of the Chairman. The Engineers are on notice that no additional fee is payable under this Agreement for supervision and inspection services performed during additional periods of time covered by extensions of time under the Contract'.

'2.4 The Engineers shall compile and submit in accordance with the directions of the Chairman all reports, monthly and final estimates, records, four (4) sets of prints on cloth, (1 additional set for work involving railroads) of the plans showing all changes from contract plans and other pertinent data, photographs of various phases of construction and all other data which may be required for proper completion and records of the Contract. A diary shall be kept describing the progress of the work, specific problems encountered and all other pertinent information relative to the execution of the Contract'.

'6. The Authority shall pay to the Engineers, and the Engineers agree to accept as full compensation for their services under this Agreement 4 1/2% (Four and one half per cent) of the complete and final construction of the Contract.

'6.1 The Engineers shall be paid in monthly progress payments based upon the value of the construction work progressed by the construction Contractor, as determined and certified to by the Chairman.

'6.2 The last and final payment to the Engineers, including retained percentages, shall become due and payable upon the actual completion and acceptance of the work under the Contract and the filing by the Engineers with the Chairman of all required records and the final estimate of the Contract.'

It is important to note that the engineering contracts concerned in both claims were...