Frank Briscoe Co., Inc. v. Clark County
| Decision Date | 15 September 1988 |
| Docket Number | No. 87-2230,87-2230 |
| Citation | 857 F.2d 606 |
| Parties | FRANK BRISCOE COMPANY, INC., Plaintiff-Appellee, v. CLARK COUNTY, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Ninth Circuit |
William H. Alsup, San Francisco, Cal., for defendant-appellant.
Morton R. Galane, Las Vegas, Nev., for plaintiff-appellee.
Appeal from the United States District Court for the District of Nevada.
Before SCHROEDER, FLETCHER and BOOCHEVER, Circuit Judges.
Clark County, Nevada appeals a jury verdict in favor of Frank Briscoe Co., a New Jersey corporation. Briscoe filed a diversity action in the District of Nevada in connection with a contract to construct a wastewater treatment plant. The jury awarded Briscoe $16.24 million in damages against the County, which was reduced by $275,000 upon Briscoe's acceptance of a remittitur.
The County contends on appeal that Nevada's notice-of-claim statute barred the damage award; a continuance during the
trial was prejudicial; the jury was instructed improperly on contract warranties; special interrogatories formulated by the district court were ambiguous and confusing; and unrebutted, argumentative reference charts prepared by Briscoe improperly were submitted to the jury. We affirm.
In September 1976, the County requested bids for construction of an advanced wastewater treatment plant. Nevada Environmental Consultants (NECON), an engineering joint venture, provided design services to the County for the project, including the plans, specifications, and bidding documents used by the contractors in formulating their bids. Briscoe submitted a $52.3 million bid and was awarded the contract in March 1977. Pursuant to the design specifications, Briscoe's contract with the County mandated completion of the plant by June 29, 1980, a period of 1,200 days.
Morrison-Knudsen Co., a construction manager, served as the County's project representative. NECON's contract to provide engineering services was terminated by the County in October 1977, about seven months after construction had begun. H.K. Ferguson Co. provided interim engineering services on the project until February 1978, when URS Forrest & Cotton was named successor engineer. These firms did not have access to NECON or its design analysis or calculations.
A number of disputes arose during plant construction. The County contends that these disputes concerned the quality of Briscoe's performance and the impact of certain contract requirements on Briscoe's time and cost of performance. Briscoe insists that the County failed to provide engineering services as required by the contract and that the successor engineers, endeavoring to correct NECON's errors and omissions, compounded these problems by shifting responsibility for redesigning the plant to Briscoe under the guise of contract interpretation.
Pursuant to an amending provision in the contract, Briscoe submitted numerous written requests to Morrison-Knudsen for time and price adjustments. Briscoe contends that with few exceptions, the County refused to accept the blame for construction delays or otherwise recognize the merits of Briscoe's protests. The County notes that 217 change orders were approved, extending the completion date 210 days and increasing the contract price by more than $675,000.
Faced with lengthy delays and huge cost overruns, Briscoe filed this action in May 1980 in the District of Nevada against the County, Morrison-Knudsen, both successor engineers, and nine other defendants. Briscoe sought specific performance of the contract and injunctive and declaratory relief against the County, but did not seek damages. In July, the County filed a breach of contract counterclaim against Briscoe. In September 1980, Briscoe responded by filing "counterclaims in reply" against the County for breaches of contract and warranty, seeking damages "in an amount to be established at the trial."
Briscoe continued construction of the treatment plant while its suit was pending. The project was completed in April 1982, fifteen months after the adjusted contract deadline. In September 1983, three years after filing its counterclaims in reply, Briscoe submitted in connection with the litigation a summary of damages totaling $49 million. Briscoe filed an amended complaint in April 1984 which requested $70 million each in compensatory and punitive damages. Two weeks later, the County moved to dismiss ten counts of the amended complaint.
The jury trial began on November 13, 1985 and was adjourned for the holidays between December 19, 1985 and January 6, 1986. The recess was extended until March 3 by District Judge Roger D. Foley sua sponte in a minute order. Judge Foley attached to the order a letter from the Administrative Office of the United States Courts which advised senior district judges wishing to avoid having FICA taxes deducted from their salaries "to cease performing judicial duties during the first 60 to 90 days of 1986" in light of pending The district court ruled on the County's two-year old motion to dismiss on March 3, dismissing each of the defendants except the County and striking portions of the amended complaint. Frank Briscoe Co. v. County of Clark, 643 F.Supp. 93 (D.Nev.1986). The trial was then resumed, and lasted a total of eighty-seven days. The parties presented more than 2,200 exhibits and nineteen expert witnesses testified.
legislation. The County moved for a mistrial, claiming that the continuance, extended again until March 11, was prejudicial. The motion was denied.
The County was granted a partial directed verdict in July 1986, leaving for jury consideration thirteen claims from a single count of Briscoe's amended complaint. The court formulated ten special interrogatories from these claims, requiring the jury to determine specifically whether the County breached the contract and caused Briscoe to delay completion of the treatment plant by:
(1) terminating NECON as project engineer;
(2) failing to provide essential engineering services;
(3) dividing the project into four segments;
(4) requiring segmentation of progress scheduling;
(5) failing to review pre-bid submittals;
(6) submitting defective plans and specifications;
(7) failing to timely process change orders;
(8) disrupting and interfering work scheduling;
(9) failing to timely approve shop drawings; and
(10) interfering with work performance.
The jury found for Briscoe on eight of the ten interrogatories and determined that the County was responsible for 612 of the 667 days the project was delayed.
The interrogatories did not ask for a particular damage value for each day of delay. The jury instead awarded Briscoe a general verdict of $16.24 million in damages. The court denied the County's motion for judgment notwithstanding the verdict or a new trial when Briscoe accepted a $275,000 remittitur. Judge Foley determined that the remittitur was necessary to offset an erroneous jury instruction regarding the County's counterclaim for liquidated damages under the contract for delays caused by Briscoe. 1
The County initially contends that this case should not have progressed to trial because Briscoe failed to comply with Nevada's notice-of-claim statute. It provides:
1. All unaudited claims or accounts against any county shall be presented to the board of county commissioners within 6 months from the time such claims or accounts become due or payable.
2. No claim or account against any county shall be ... paid by the board of county commissioners, or any other officer of the county, unless the provisions of subsection 1 are strictly complied with.
Nev.Rev.Stat. Sec. 244.250 (1985).
In his decision and order denying the County's motion to dismiss, Judge Foley found that Briscoe had not formally presented its claim to the Board of County Commissioners of Clark County. Briscoe, 643 F.Supp. 93, 100. He nevertheless concluded that the statute did not bar Briscoe's suit:
This Court does not wish to exalt technical form over substance and throw Briscoe out of court. Whether unconstitutionality, waiver, estoppel, substantial compliance or some other grounds are assigned as the reason, it seems it would be unconscionable to dismiss Briscoe's claims for such technical noncompliance.
Id. at 103. Briscoe does not challenge the constitutionality of section 244.250 on appeal, but contends that strict compliance with the statute was excused in this case by waiver, estoppel, or substantial compliance.
We may affirm the district court's decision on any ground finding support in the record. Lou v. Belzberg, 834 F.2d 730, 739 (9th Cir.1987), cert. denied, --- U.S. ----, 108 S.Ct. 1302, 99 L.Ed.2d 512 (1988). We believe that a waiver rule adopted in 1976 by the Supreme Court of Nevada for compulsory counterclaims similarly exempts Briscoe's counterclaims in reply from the operation of the statute. We therefore do not address Briscoe's other excuses for noncompliance.
The interpretation of Nevada's notice-of-claim statute is a question of state law reviewed de novo. Olympic Sports Prods., Inc. v. Universal Athletic Sales Co., 760 F.2d 910, 912 (9th Cir.1985), cert. denied, 474 U.S. 1060, 106 S.Ct. 804, 88 L.Ed.2d 780 (1986). The decisions of a state's highest court are binding on a federal court sitting in diversity. Id. at 913. In the absence of controlling state law, however, the court "must use its own best judgment in predicting how the state's highest court would decide the case." Takahashi v. Loomis Armored Car Serv., 625 F.2d 314, 316 (9th Cir.1980).
In State v. Capital Convalescent Center, 92 Nev. 147, 547 P.2d 677 (1976), the Supreme Court of Nevada ruled that a defendant's failure to comply with an analogous notice statute did not bar it from filing a compulsory counterclaim against the state:
It would be anomalous to hold that a defendant, in court in an action he...
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