City of Daytona Beach v. GANNETT FLEMING CORDDRY & C.

• Decision Date: 16 May 1958
• Docket Number: No. 16758.,16758.
• Citation: 253 F.2d 771
• Parties: CITY OF DAYTONA BEACH, Appellant, v. GANNETT FLEMING CORDDRY AND CARPENTER, Inc., Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

253 F.2d 771 (1958)

CITY OF DAYTONA BEACH, Appellant, v. GANNETT FLEMING CORDDRY AND CARPENTER, Inc., Appellee.

No. 16758.

United States Court of Appeals Fifth Circuit.

April 7, 1958.

Rehearing Denied May 16, 1958.

John R. Parkinson, Parkinson & Sessions, Daytona Beach, Fla., for appellant.

Paul E. Raymond, Daytona Beach, Fla., William A. Hamilton, Jacksonville, Fla., Raymond, Wilson & Karl, Daytona Beach, Fla., and Jennings, Watts, Clarke & Hamilton, Jacksonville, Fla., of counsel, for appellee.

Before RIVES, TUTTLE and JONES, Circuit Judges.

TUTTLE, Circuit Judge.

This is an appeal by the City of Daytona Beach, the plaintiff, from orders dismissing and striking certain tort allegations of its complaint without leave to amend and denying its motion for summary judgment and granting defendant's motion for summary judgment upon plaintiff's restitution claim. In this action the City seeks to recover from the defendant, a corporation composed of engineers, damages for the defendant's willful or reckless or negligent performance of its duties under a contract and certain alleged overpayments made to the defendant pursuant to the contract.

The defendant was engaged by the City during 1949-1950 to design, supervise, and inspect the construction of a citywide paving and street improvement program.¹ The actual construction was done by three other corporations not parties to this litigation. During 1949 and 1950 the defendant submitted various invoices to the City covering claimed expenses and fees under the contract terms, which were paid by the City. The principal item of contention involved in the overpayment claim concerns the contract clause which entitled the engineers to "3% of the estimated cost, to be revised upward or downward when the final construction cost is known." The City accepted a bid from a contractor for $2,340,849.66 which was finally let at $2,242,099.66, and had the 3% compensation been computed upon this amount the engineers would have received $67,262.00. However, when the work was completed by the contractors the total payments amounted to $2,020,542.64, which figure, if controlling, would have entitled the engineers to $60,616.28. The City maintains that the last mentioned figure is the "final construction cost" and that the defendants were overpaid by $5,383.72 since they received $66,000. The City further contends that rent for the defendant's Daytona Beach office and the salary for the stenographer in the Daytona Beach office as well as part of the salaries of the president and vice president of the defendant charged to the job were improper items under the "cost plus" part of the contract. The then City Manager and City Engineer settled with the defendants with the result that the City paid a $66,000 fee on the original contract, a $7,197.52 fee for subsequent plans for storm sewers, and all the overhead expenses claimed by the engineers which amounted to $62,691.14. The members of the then city commission approved these dealings informally, and there is now a question of proper authority. In the stricken allegations the City alleged that the engineers performed their work in such a negligent, reckless, or willful manner as to thereby cause unnecessary expenses and a defective final product.

The initial issue is whether, as a matter of tort law, the plaintiff has stated a claim upon which relief may be granted in regard to the acts of the defendant in the performance of its duties under the contract. It appears clear to us that such a claim has been presented and that the motion to strike and dismiss should have been denied. Under the Federal Rules of Civil Procedure, 28 U.S. C.A., detailed pleading is not required, and once a legal duty appears, it is sufficient against a motion to dismiss to allege that the defendant acted in a negligent manner and as a result the plaintiff was injured. Carss v. Outboard Marine Corporation, 5 Cir., 252 F.2d 690; Des Isles v. Evans, 5 Cir., 200 F.2d 614; Augusta Broadcasting Co. v. United States, 5 Cir., 170 F.2d 199. A complaint must be held sufficient if, on any view of the allegations, plaintiff states facts sufficient to entitle him to relief. Guth v. Texas Co., 7 Cir., 155 F.2d 563. And negligence, recklessness, and willfulness may be pleaded in the alternative. Official Form 10, F.R.C.P. Appendix of Forms 28 U.S. C.A.; Moore's Federal Practice ¶ 8.31.

By alleging the contract provision by which the defendants undertook to prepare specifications, to inspect and supervise construction, and the representation by the engineers that they were a nationally recognized engineering organization with vast experience and possessing requisite skill and knowledge to perform the engineering work, plaintiff has alleged a duty and standard of care owed to it by the defendant. The complaint alleges breach of this duty in several instances. The engineers, it is maintained, recommended the use of Trinidad Lake asphalt cement, the price of which was over two and one-half times that of petroleum asphalt cement and which was not of a superior quality and was no longer being recommended for paving work in Florida, facts which competent engineers did know or should have known. Further, it is claimed that defendant failed to insert a provision in the specification included in the contract with the contractor whereby the contract prices of asphalt courses would be reduced in the event the percentages of asphalt cement used should be reduced, and that by the exercise of ordinary skill and care the defendant should have known this failure would increase plaintiff's costs. When less asphalt cement was used, plaintiff, under the specifications could receive no reduction, and its costs were unnecessarily increased. Moreover, it is alleged that the engineers allowed defective concrete pipe to be used and the joints in the piping to be cemented in a manner not according to specifications. It is...