Denton Const. Co. v. Missouri State Highway Commission

• Decision Date: 13 April 1970
• Docket Number: No. 2,No. 54072,54072,2
• Citation: 454 S.W.2d 44
• Parties: DENTON CONSTRUCTION COMPANY, a Michigan Corp., Appellant-Respondent, v. MISSOURI STATE HIGHWAY COMMISSION et al., Appellants-Respondents
• Court: Missouri Supreme Court

Page 44

454 S.W.2d 44

DENTON CONSTRUCTION COMPANY, a Michigan Corp., Appellant-Respondent, v. MISSOURI STATE HIGHWAY COMMISSION et al., Appellants-Respondents.

No. 54072.

Supreme Court of Missouri, Division No. 2.

April 13, 1970.

Motion for Rehearing or for Transfer to Court En Banc Denied

May 11, 1970.

Leslie W. Fleming, Detroit, Mich., John W. Inglish, Jefferson City, for plaintiff-respondent-appellant.

Carson, Inglish, Monaco & Coil, Jefferson City, Butzel, Eaman, Long, Gust & Kennedy, Detroit, Mich., of counsel.

Robert L. Hyder, Bruce A. Ring, Jefferson City, for defendant-respondent-appellant.

STOCKARD, Commissioner.

The State Highway Commission of Missouri (hereafter referred to as the 'Commission') entered into a contract with the R. B. Potashnik Company for the construction of the roadbed ¹, ditches, slopes and median for a fifteen mile section of Interstate Highway 55, a four-lane divided highway. That contract and the work done pursuant to it will hereafter be referred to as Project 16. It was completed in October 1963, and the Commission accepted and approved the work. The Commission then entered into a contract with plaintiff on January 21, 1964 for a second stage of construction, hereafter referred to as Project 17, which consisted primarily of laying pavement and soil cement shoulders on the roadbed previously constructed under Project 16. It also included the construction of guardrails, signs, and some lighting fixtures, but those matters are not material to the issues on this appeal.

At the time plaintiff's representative inspected the project site prior to submitting its bid, there had been some erosion on the higher fills. In the contract for Project 17, there was Special Provision S entitled 'Embankment in Place' which in substance provided that in submitting its bid plaintiff should include a 'lump sum' for work which would be required because of 'conditions resulting from erosion,' and in the special provision it was stated that 'This item of work will apply to material necessary to restore the roadbed from outside shoulder to outside shoulder to proper section and the necessary blending into the fill slopes adjacent thereto.' Plaintiff included in its bid a 'lump sum' of $20,000 for this item. Material was removed from the roadbed by rain and wind and deposited in the median and ditches, and the slopes and shoulder areas were damaged. Before plaintiff could perform the laying of the pavement and the placing of soil cement on the shoulders in accord with the specifications, this damage to the roadbed had to be repaired. To accomplish this, new and additional material had to be placed on the roadbed and shoulders, and the material then had to be graded to restore the roadbed to its previous condition. Plaintiff's claim for $138,910 for performing this work was set forth in Count II of its petition. The Commission took the position that under the terms of the contract for Project 17, plaintiff was obligated to perform whatever work was necessary to repair all and any damage to the roadbed resulting from rain and wind erosion.

The Commission also took the position that plaintiff was required under the terms of the contract for Project 17, to repair all erosion damage to the roadway, which included the median, slopes and ditches. Over the protest of plaintiff this demand of the Commission was enforced by refusing to approve and accept the work on Project 17, the approval and acceptance being on a mile-by-mile basis, until the work in the median and ditches and on the slopes was performed by plaintiff. That work consisted primarily of removing or redistributing the excess material washed or blown into the areas and then regrading, shaping and reseeding the areas. The Commission agreed to and did pay plaintiff for reseeding these damaged areas after plaintiff had restored them, but it insisted that all other work be done without additional compensation. Plaintiff obtained additional equipment and manpower and performed the necessary work to restore the roadbed, shoulders, and the areas of the median, ditches and slopes, and it also laid the pavement and soil cement and performed the other work within the time prescribed for the completion of Project 17. Plaintiff's claim for $133,122 for removing the eroded material from the median and ditches was incorporated in Count III of its petition, and its claim for $104,160 for regrading and reshaping the slopes, median and ditches was set forth in Count IV.

In addition to the above, plaintiff contended that after it started work on Project 17, it was furnished a copy of 'final' plans for Project 16 which disclosed, disregarding the question of damage from erosion, that the roadbed had not been constructed according to the plans which had been furnished to plaintiff and which were a part of its contract, and that additional work was required by reason of this. Plaintiff's claim in the amount of $10,025 for supplying a deficiency of 5,012 cubic yards of material was set forth in Count I.

The trial court held that erosion damage to the roadbed, that is, the areas where pursuant to the terms of the contract for Project 17 plaintiff was to lay the pavement and soil cement, occurring after the execution of the contract and the necessary work to correct the damage, was a contingency assumed by the plaintiff, and it entered judgment for the Commission on Count II of the petition.

The trial court entered judgment for plaintiff on Counts III and IV, and held that plaintiff was entitled to compensation in the amount of $240,957 for removing eroded material from the median and ditches and for regrading and shaping the median, ditches and slopes. The trial court also entered judgment for plaintiff on Court I and held it entitled to damages in the amount of $10,024 for the failure of the Commission to provide a roadbed which conformed to the plans. The total judgment in favor of plaintiff was $250,981. Both parties have appealed. We will consider first the appeal of the Commission.

The Commission first challenges the award to plaintiff of $10,024 on Count I. The Commission argues that the evidence does not show any actual shortage of material, and then asserts alternatively that payment was made to plaintiff for a 'quantity of waste soil cement sufficient to offset any shortage of material as alleged.'

The Commission concedes that there was a 'theoretical' shortage on the roadway of 5,012 cubic yards of material. This came about by reason of a change in what the witnesses referred to as the 'template' during the construction work on Project 16 with no corresponding change in the plans which were the basis of plaintiff's bid on Project 17. The difference was discovered by plaintiff during the work on Project 17. Because the roadbed had been severely damaged by erosion it was impossible to determine with accuracy the actual shortage in the amount of material. The Commission's resident engineer testified that 'there was theoretically five thousand and so much short' in the material, and that 'any dirt that was required to be furnished, (plaintiff) did furnish.' In addition, there was introduced in evidence by plaintiff its Exhibit 23, which was a letter from the Commission, signed by its chief engineer, addressed to plaintiff. This letter set forth a ruling by the Claims Committee of the Commission on plaintiff's claims. By that letter the Commission agreed that 'payment should be made for the embankment material theoretically not placed by the grading contractor due to the difference in the grading and paving typical sections.' It was also stated that 'We have made a very detailed study of the difference in the quantities involved, and have arrived at a figure of 5,012 cu. yds. instead of the 3,391 cu. yds. as computed by you. At the $2 per cu. yd. bid price for this item, this would total $10,024.00.' It thus appears that the Commission admitted that there was a 'theoretical' shortage, and it also admitted that after a 'very detailed study' of the actual shortage it had arrived at the figure of 5,012 cubic yards. It is true that these admissions and the computation by the Commission were incorporated into the letter as a part of an 'offer of $10,024.00 as full and complete settlement of your claim against the Commission,' and ordinarily such an offer would not be admissible in evidence to prove the facts stated therein. However, the letter was admitted into evidence with 'No objection' to any part of it. It was not offered for any limited purpose but was admitted generally. Under these circumstances its contents may properly be considered as evidence of the facts therein set forth. The finding of the trial court was that the 'difference in the worksite as constructed and as shown on the plaintiff's plans was computed by the Commission to represent a shortage of 5,012 cubic yards of material spread along the edge of 60 miles of shoulder. Thus, the plaintiff was required to provide 5,012 cubic yards of additional material to make the worksite conform to the plans.' Based upon our study of the evidence, and also affording due deference to the findings of the trial court, we conclude that the trial court correctly found that there was an actual shortage of material in the amount of 5,012 cubic yards.

We find no merit to the Commission's alternative assertion that it is entitled to 'off-set any shortage of material.' First, the claim to a setoff was not pleaded, and as far as we can determine it was first mentioned in the motion for new trial. Second, the evidence does not support the claim. The Commission relies on the testimony of its resident engineer to the effect that during the placement of soil cement, problems developed and payment was allowed for the use of additional soil cement. The reasons testified to at trial by the engineer for permitting the use of additional soil cement were not the same as the 'reasons' approved by the same...