Gilbert Engineering Co. v. City of Asheville

• Decision Date: 07 May 1985
• Docket Number: No. 8428SC547,8428SC547
• Court: North Carolina Court of Appeals
• Parties: GILBERT ENGINEERING COMPANY v. CITY OF ASHEVILLE, North Carolina, a municipal corporation, and O'Brien & Gere, Inc., a corporation.

Page 849

328 S.E.2d 849

74 N.C.App. 350

GILBERT ENGINEERING COMPANY v. CITY OF ASHEVILLE, North Carolina, a municipal corporation, and O'Brien & Gere, Inc., a corporation.

No. 8428SC547.

Court of Appeals of North Carolina.

May 7, 1985.

Raymer, Lewis, Eisele, Patterson and Ashburn by Douglas G. Eisele, Statesville, for plaintiff-appellant.

Bennett, Kelly and Cagle by Harold K. Bennett, and William F. Slawter, City Atty., Asheville, for defendant-appellee City of Asheville.

Kennedy, Covington, Lobdell and Hickman by Wayne Huckel, Charlotte, for defendant-appellee/cross appellant, O'Brien & Gere, Inc.

MARTIN, Judge.

I. GILBERT'S APPEAL

The dispositive question presented by Gilbert's appeal is whether the trial court's findings of fact and conclusions of law are sufficient to support its judgment denying Gilbert recovery against City on its claims relating to repairs to the key wall. Because the trial court failed to address an essential issue raised by the pleadings and the evidence, we conclude that the judgment is deficient and remand the case to the trial court.

In its amendment to the complaint, Gilbert alleged that City, in presenting the plans and specifications for the key wall, impliedly warranted that if Gilbert constructed the key wall as required by the plans and specifications, that it would be fit for the purposes intended, i.e., the containment of water in the filter beds. Gilbert further alleged that it constructed the key wall as required and that, nevertheless, the key wall permitted the leakage of water. Thus, Gilbert alleged, the City breached its implied warranty causing Gilbert to incur expense in repairing the leaks and delaying its completion of the project. City denied the existence of any warranty and denied the allegations of breach.

The general rule is that a construction contractor who has followed plans and specifications furnished by the owner, or his architect or engineer, will not be responsible for consequences of defects in those plans or specifications. Annot., 6 A.L.R.3d 1344 (1966). North Carolina has expressly adopted the general rule. Bd. of Education v. Construction Corp., 50 N.C.App. 238, 273 S.E.2d 504, aff'd, 304 N.C. 187, 282 S.E.2d 778 (1981). The basis for the rule is that, absent an agreement to the contrary, there is an implied warranty by the owner that the plans and specifications are suitable for the particular purpose, and that if they are complied with the completed work will be adequate to accomplish the intended purpose. See United States v. Spearin, 248 U.S. 132, 39 S.Ct. 59, 63 L.Ed. 166 (1918); Annot., 6 A.L.R.3d supra. In order to establish a breach of such an implied warranty, the burden of proof is on the contractor to prove that the plans and specifications were adhered to, that they were defective, and that the defects were the proximate cause of the deficiency in the completed work.

The evidence presented with respect to these facts was conflicting. Gilbert's evidence tended to show that it constructed the key wall in strict compliance with the plans and specifications, but that cracks developed at construction joints and around pipe sleeves, causing leakage. Gilbert also offered evidence that due to the design of the piping, the flanges on the filter building side of the key wall were located too near the wall to permit the conventional method of caulking provided for by the plans, so that an alternative, and more expensive, method of caulking had to be employed. A structural engineer testified for Gilbert that, in his opinion, the leakage was caused by differential settlement of the key wall due to its being founded partially in rock and partially on soil, and that the design did not include provisions for differential settlement or varying subsoil conditions. Gilbert's project manager testified that had the leakage problems not been encountered, Gilbert could have achieved substantial completion by 14 October 1977, 187 days earlier than it was actually achieved. Defendants O'Brien & Gere and City offered evidence tending to show that throughout the project, Gilbert's rate of progress fell progressively behind the contract schedule due to Gilbert's failure to assign sufficient men and equipment to the project, so that the problems experienced by Gilbert with the key wall leakage had no effect on the overall completion date. Defendants also offered evidence that Gilbert had not installed the piping according to the specifications, that the conventional method of caulking the pipes in the sleeves could have been accomplished, and that a number of the leaks were due to improper caulking. They also offered evidence that a concrete wall, such as this key wall, cannot be designed to avoid all leakage and that Gilbert knew or should have known, when it submitted its bid and entered the contract, that waterproofing would be necessary in order to comply with the contract requirement for a water tight structure. The engineer who designed the wall testified that he provided for settlement in design of the key wall. Both he and another engineer testified that, in their opinion, differential settlement had not occurred.

In cases where the trial judge sits as the trier of facts, he is required to (1) find the facts on all issues joined in the pleadings; (2) declare the conclusions of law arising on the facts found; and (3) enter judgment accordingly. Coggins v. City of Asheville, 278 N.C. 428, 180 S.E.2d 149 (1971); G.S. 1A-1, Rule 52(a). The facts required to be found are the ultimate facts established by the evidence which are determinative of the questions involved in the action and essential to support the conclusions of law reached. Quick v. Quick, 305 N.C. 446, 290 S.E.2d 653 (1982). The requirement is designed to "dispose of the issues raised by the pleadings " and to permit "a reviewing court to determine from the record whether the judgment--and the legal conclusions which underlie it--represent a correct application of the law." Coble v. Coble, 300 N.C. 708, 712, 268 S.E.2d 185, 189 (1980) (emphasis supplied). The court's findings of fact are conclusive on appeal if supported by competent evidence, even though there may be evidence to the contrary. Williams v. Insurance Co., 288 N.C. 338, 218 S.E.2d 368 (1975).

In the case before us, the issue of implied warranty of the plans and specifications and the issue of breach of such warranty were clearly raised by the amended pleadings and by conflicting evidence in the record. Specifically, then, the trial court was required to determine whether such a warranty existed (in view of City's assertion that the contract disclaimed warranties), and, if so, whether it had been breached by City. The court's findings and conclusions do not address these issues.

The court found that the key wall...