City of Cape Girardeau v. Jokerst, Inc.

• Decision Date: 11 June 2013
• Docket Number: No. ED 98654.,ED 98654.
• Court: Missouri Court of Appeals
• Parties: CITY OF CAPE GIRARDEAU, ex rel, and KLUESNER CONCRETERS, Respondents, v. JOKERST, INC., and United Fire & Casualty Company, Appellants.

402 S.W.3d 115

CITY OF CAPE GIRARDEAU, ex rel, and KLUESNER CONCRETERS, Respondents,

v.JOKERST, INC., and United Fire & Casualty Company, Appellants.

No. ED 98654.

Missouri Court of Appeals,

Eastern District,

Division Five.

June 11, 2013.

Terry R. Rottler, Ste. Genevieve, MO, for appellants.

John A. Loesel, Jackson, MO, for respondent.

GARY M. GAERTNER, JR., Chief Judge.

Introduction

Appellant Jokerst, Inc. (Jokerst), was the general contractor on a construction project, and Respondent Kluesner Concreters (Kluesner) provided concrete work for the project as a subcontractor. The parties disputed the terms of their contract, and the trial court found in favor of Kluesner, ordering Jokerst to pay the balance due on Kluesner's invoices. Jokerst argues it had paid Kluesner the full lump sum amount of their agreement. We reverse in part, affirm in part, and affirm the result.

Background

In 2009, the City of Cape Girardeau (City) requested bids for general contractors to complete a construction project called the Cape Splash Aquatic Center (Cape Project). In preparing its bid to submit to the City, Jokerst requested a bid from Kluesner for concrete work as a subcontractoron the Cape Project.¹ Jokerst provided Kluesner with information regarding the different types of concrete work that were needed for the Cape Project and approximate measurements for each.

Using the information Jokerst provided, Kluesner prepared a two-page bid, which Kluesner submitted to Jokerst by fax. The top of each page listed the word “Estimate.” The total price for the work, listed at the bottom of the second page of the bid, was $104,747.40. Besides form information contained on both pages, the only other information on the second page was a short paragraph containing the following wording:

This bid is good for thirty days after the above date. Final billing to be based upon actual measurements of completed work.

Kluesner's bid was dated May 1, 2009.

On May 29, 2009, Jokerst sent a fax (May 29 Fax) to Kluesner containing the following statements:

We were the low bidder for [the Cape] Project. We have received a notice to proceed on the Project.

Your bid of $104,747.40 was used for concrete for the job. This project was a lump sum contract. If you have any questions please call. We are looking forward to working with you.

In September of 2009, Kluesner began work on the Cape Project. Kluesner submitted an invoice that month and another in November of 2009. These invoices listed measurements for work completed, the unit price for each type of construction, and a total amount billed for the work completed as of the date of each invoice. Jokerst paid the amounts listed on both invoices, a total of $45,883.73.

In April 2010, Jokerst asked Kluesner to change construction of a particular curb for the Cape Project.² The original plan had called for a “curb and gutter,” and Jokerst asked Kluesner to construct a “stand-up curb” instead. The parties did not discuss whether this change would affect the price of the curb, which Kluesner had listed originally in his bid as $20.90 per lineal square foot of curb and gutter. Kluesner completed the stand-up curb as requested.

Kluesner sent two additional invoices to Jokerst, dated April 27, 2010, and May 11, 2010. Each invoice contained the heading “Extra Work Order,” underneath which was a line item for the portion of the stand-up curb that had been completed along with the unit price, $30.00 per lineal square foot. Jokerst paid for each item listed on the invoices except those for the stand-up curb. This left a difference of $24,090.00 Kluesner noted as remaining due from those invoices.

After Jokerst completed the Cape Project, Jokerst sent a check to Kluesner for $1,349.82, which represented the amount Jokerst had determined was still due to Kluesner based on Kluesner's original total bid price.³ With the check, Jokerst sent a breakdown of its calculations for arriving at that check's amount, which was listed as “Final Check Amount Paid.” Kluesner deposited the check, and thereafter filed suit for the remainder of its costs associated with the stand-up curb.

Kluesner asserted claims in contract and in quantum meruit. Jokerst argued it had fulfilled the terms of the parties' contract for a lump sum amount. Kluesner argued that the contract was not for a lump sum, but for the unit prices of the work actually completed. The trial court found that no lump sum contract existed, and that a contract for the unit prices contained in Kluesner's bid was created when the City accepted Jokerst's bid. The trial court also found that Jokerst did not make proper inquiries related to the price of the stand-up curb and what was necessary for submitting a change order in order to be compensated by the City for the additional cost. The trial court found that Jokerst benefitted from the stand-up curb because it allowed for easier completion of other portions of the Cape Project. Thus, the trial court concluded, Jokerst must pay the remaining amount due to Kluesner for the stand-up curb, $21,738.03.⁴ The trial court also ordered Jokerst to pay prejudgment interest in the amount of nine percent per annum from the date of May 11, 2010. This appeal follows.

Discussion

Jokerst raises four points on appeal. In Point I, Jokerst argues the trial court erred in concluding that a contract existed between the parties for the unit prices contained in Kluesner's bid, and alternatively that the trial court erred in not accepting Jokerst's affirmative defenses of waiver and accord and satisfaction. Jokerst argues in its second point that the trial court erred in granting relief in quantum meruit because Jokerst did not receive any benefit from the stand-up curb and was not unjustly enriched. Jokerst argues in Point III that the judgment is ambiguous and inconsistent in that it fails to distinguish between the two claims Kluesner raised, and the judgment improperly grants Kluesner combined relief under two alternative theories of recovery. Finally, in Point IV, Jokerst argues that the trial court erred in granting Kluesner prejudgment interest because the parties' differing views of the contract between them resulted in unliquidated damages.

Standard of Review

Our review of court-tried cases is governed by the standard set forth in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). We affirm the judgment unless there is no substantial evidence to support it, it is against the weight of the evidence, or it erroneously declares or applies the law. Id. We defer to the factual findings of the trial court, but we review its legal conclusions de novo. Mortenson v. Leatherwood Constr., Inc. 137 S.W.3d 529, 531 (Mo.App. S.D.2004).

Point I

Jokerst argues the trial court erred in concluding that Jokerst's use of Kluesner's bid and the City's subsequent award of the Cape Project to Jokerst formed a contract between Jokerst and Kluesner for the unit prices contained in Kluesner's bid. We agree.

At issue here is the essential contract element of mutuality of assent. “In order for a contract to be formed, the parties must mutually assent to its terms.” Gateway Exteriors, Inc. v. Suntide Homes, Inc., 882 S.W.2d 275, 279 (Mo.App. E.D.1994). There must be a “meeting of the minds” regarding the terms of the contract as shown by the parties' words or acts, and not by the understanding or supposition of one of the parties. Id.

Normally, a general contractor's use of a subcontractor's bid does not in itself form a contract, even when the general contractor is subsequently awarded the project. See generally 1 Corbin on Contracts § 2.31 (Rev. ed.1993). There may be an exception where there is evidence of a definite, uniform, and known practice, whereby the use of a subcontractor's bid by a general contractor constitutes acceptance and creates a contract. Accord Sharp Bros. Contracting Co. v. Commercial Restoration, Inc., 334 S.W.2d 248, 251 (Mo.App.1960).

Absent such evidence, Missouri courts have at times used the doctrine of promissory estoppel to require a subcontractor's performance when a general contractor has relied on the subcontractor's bid and is awarded the general contract. See Branco Enters., Inc. v. Delta Roofing, Inc., 886 S.W.2d 157, 159 (Mo.App. S.D.1994) (citing Delmo, Inc. v. Maxima Elec. Sales, Inc., 878 S.W.2d 499, 504 (Mo.App. S.D.1994)). The elements of promissory estoppel differ from the traditional offer and acceptance components of a contract. Promissory estoppel consists of (1) a promise, (2) foreseeable reliance, (3) reliance, and (4) injustice absent enforcement. Id. In the construction context, courts have found a subcontractor's bid contains a promise to perform consistent with the terms of the bid, that a general contractor's reliance on the bid is foreseeable, and thus once a general contractor has been awarded a contract and relied on the subcontractor's bid to do so, injustice would result if the subcontractor fails to perform under its bid. See id. at 160–61.

However, here we face the converse situation. Kluesner did not attempt to avoid the terms of its bid; rather, Kluesner performed the work and sought to have its bid terms enforced against the general contractor. Yet, in such a context, we have found no Missouri court finding existence of a contract or a promise enforceable against a general contractor created simply by the general contractor's use of the subcontractor's bid. In fact, the contrary is true. See generally 1 Corbin § 2.31 (noting no mutuality of obligation: though subcontractor may be bound when general contractor uses subcontractor's bid, does not follow that general contractor must hire subcontractor if awarded project). This is because the general contractor's simple use of a subcontractor's bid is not analogous to the promise to perform if accepted contained in the subcontractor's bid. A general contractor, by soliciting bids, makes no promise inviting detrimental reliance to a...