Cook v. Oklahoma Bd. of Public Affairs, s. 59824
| Decision Date | 31 March 1987 |
| Docket Number | Nos. 59824,59850,s. 59824 |
| Citation | 1987 OK 22,736 P.2d 140 |
| Parties | James John "Jack" COOK d/b/a C & C Development Company, Appellee/Cross-Appellant, Plaintiff, v. OKLAHOMA BOARD OF PUBLIC AFFAIRS and Oklahoma Department of Wildlife Conservation, Appellants/Cross-Appellees, Defendants, and Poe & Associates of Kansas, Inc. and Robert C. Poe, Appellants/Cross-Appellees, Defendants. |
| Court | Oklahoma Supreme Court |
Michael C. Turpen, Atty. Gen., Neal Leader, Asst. Atty. Gen., Deputy Chief, Civ. Div., Lynn Barnett, Asst. Atty. Gen., Oklahoma City, for appellants/cross-appellees, defendants Oklahoma Bd. of Public Affairs and Oklahoma Dept. of Wildlife Conservation.
Hugh A. Baysinger, Messrs. Pierce, Couch, Hendrickson, Johnston & Baysinger, Oklahoma City, for appellants/cross-appellees, defendants Poe & Associates of Kansas, Inc. and Robert C. Poe.
Robert H. Mitchell, Ernest J. Istook, Jr., Oklahoma City, for appellee/cross-appellant, plaintiff James John "Jack" Cook d/b/a C & C Development Co.
Eight issues are presented for decision: Does the Oklahoma Board of Public Affairs and the Oklahoma Department of Wildlife Conservation [State] owe a duty to disclose a subsurface condition to bidders on a construction project when its contract contains a clause that expressly disallows additional payment or extensions of time for completion of work if the contractor fails to acquaint himself with all conditions relating to the work? Are the parties absolutely bound by a contract provision that makes the engineer's determination of compliance with the contract specifications final and conclusive absent a showing of fraud or bad faith? Is the State liable for the cost of corrective work for which its agent assumed the responsibility when he instructed the contractor to replace concrete manholes? Is the contractor entitled to compensation--based on quantum meruit--for the extra work that he was required to do because of miscalculations in the plans? Is the contractor entitled to prejudgment interest on his recovery against the State? Did the trial court err in not awarding the contractor his lost profits and overhead expenses? Is the prevailing party in an action for breach of contract due to miscalculations in the plans and specifications, which required corrective work, entitled to attorney's fees under 12 O.S. 1981 § 936? and Did the agent of the State--who was found not to be liable for breach of contract--become liable for the tortious injury to the contractor because of his failure to disclose wet soil conditions?
We answer the first question in the negative because there was neither a finding that the facts were not discoverable by the investigation contemplated by the contract nor a finding of misrepresentation as to existing soil conditions. We also answer the sixth and eighth questions in the negative. Our answer to the second, third, fourth, fifth and seventh questions is in the affirmative.
James John "Jack" Cook [Cook] was the general contractor hired by the Oklahoma Board of Public Affairs to do construction work on the renovation of the east half of the Byron Fish Hatchery for the Oklahoma Department of Wildlife Conservation in accordance with plans and specifications designed by the project engineers, Robert C.
Poe and Poe & Associates of Kansas, Inc. [Poe]. The renovation project included reworking existing ponds, building a concrete drain and harvest kettle structures, and installing new fill and drain lines. On May 29, 1979 Cook was declared the low bidder and on June 6, 1979 Cook entered into a written contract with the State to construct the project for the total sum of $526,224. The terms of the contact required Cook to perform the work in accordance with the engineer's plans and specifications and to complete the project within 180 days.
The majority of the work involved excavation, filling and moving dirt to fashion the appropriate ponds and areas to be used for a fish hatchery. Cook bid the work on a per-unit basis.
Cook attended neither of the two pre-bid conferences that were held. The evidence is uncontroverted that, at the time of both of these conferences, the subsurface water conditions were discussed. Cook testified that he made no attempt to investigate the subsurface conditions of the soil, as required by the contract, because he felt he should be able to rely upon the soil borings furnished by the State with the plans and specifications. Cook sent his son to inspect the site six days after the pre-bid conference. This inspection consisted merely of driving through the location in the company of the hatchery manager.
Other contractors who bid on the project testified that they were able to discover the "wet" soil condition. 1 Cook did not offer a single witness to testify that it was not possible to determine upon inspection that the soil was "wet."
Cook commenced work on the project on July 23, 1979. Soon thereafter he began complaining to the State and the engineer that the soil conditions were wet instead of dry and that he felt he was entitled to extra compensation for working with wet soil.
On February 15, 1980, after repeated warnings about his failure to comply with the plans and specifications and to perform the work in a timely manner, Cook was removed from the job in accordance with the terms of the contract. Thereafter, Cook's bonding company employed Dave Construction Company to complete the work. While Dave Construction Company was still working on the project, Cook commenced this action against the State and Poe. Cook alleged that he was required to perform extra work for which he should be compensated because the State and Poe misrepresented the moisture content of the soil and failed to disclose the wet soil conditions, the plans and specifications contained miscalculations and errors and the State breached its contract with him--all of which caused him to incur extra costs. The cause was tried without a jury.
The district court found that the unexpected difficulties in Cook's performance of the contract were due to the State's failure to disclose the underground aquifer which was known to it. Further, the soil borings provided with the contract showed no evidence of moisture, and the trial court found that it is customary to show the soil's moisture content by borings. The lower court also found that it is the custom of the industry to advise a contractor of any serious problems that will be encountered in the work, if known. Poe was found to be the agent of a disclosed principal--the State--and hence was not liable for any damages ex contractu. 2 In addition to an award for the extra expense Cook incurred due to the wet soil conditions (removing wet dirt--$178,155 and constructing concrete mud slabs--$18,000), the district court also awarded compensation to Cook for redoing a harvest kettle that was rejected by the engineer ($10,450), laying pipes at a depth deeper than required by contract specifications ($11,000), correcting manhole elevations ($2,003) and The State appealed from the judgment and Cook counter-appealed. Even though Poe was exonerated from liability 5 he deemed himself aggrieved by the judgment and brought a separate appeal. 6 All of these appeals stand consolidated here for our disposition by this opinion.
prejudgment interest. 3 The liquidated delay damages withheld by the State were awarded to Cook as well ($23,300). Cook's total recovery amounted to $242,908 4 with counsel fees of $45,000
Construction of an unambiguous contract is a matter of law. 7 We are required to affirm the judgment of a court sitting without a jury in a common-law action if its judgment is supported by competent evidence and is not contrary to the law. 8 Where the district court, as part of its judgment, makes separate findings of fact that are responsive to and within issues but the ultimate or controlling facts found are insufficient to support the judgment, the decision is contrary to law and must be reversed. 9
The district court found that Cook was entitled to recover for his additional costs "necessitated by the wet site conditions which Defendants failed to disclose and misrepresented." Breach of duty to disclose and misrepresentation were the basis of Cook's second, third, ninth and twelfth "causes of action" 10 and thus the major portion of his claim for damages. 11
We begin our inquiry with a basic premise of contract law: "Where one agrees to do, for a fixed sum, a thing possible to be performed, he will not be excused or become entitled to additional compensation because unforeseen difficulties are encountered." 12 The contract concededly required the removal of all subsurface and ground water on the construction site. 13 Its provisions would seem to command the work which is the subject matter of this suit, 14 but Cook urges that he is entitled to damages because the State, which knew that the site conditions were wet, failed to disclose all of its information to him before bidding.
The project entailed the renovation of existing fish ponds. That fact alone, absent any specific site inspection provision, should have alerted a bidder to the possibility of wet conditions. Bidders on the project were admonished by the bid specifications to investigate and to determine soil conditions at the site. 15 They were confronted with not only a boilerplate inspection provision in printed form, but also with an invitation to attend two pre-bid conferences where the wet site conditions were discussed.
Cook urged below that, despite certain contract disclaimers, the State had an absolute duty to disclose in the contract plans and specifications its knowledge of any difficulties to be encountered. 16 The district court agreed, finding that "it is customary in such industry to advise a contractor of any serious problems which will be encountered in the work, if...
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