Harry Harris, Inc. v. Quality Const. Co. of Benton, Ky., Inc.

• Decision Date: 24 August 1979
• Parties: HARRY HARRIS, INC., a Kentucky Corporation, Appellant, v. QUALITY CONSTRUCTION COMPANY OF BENTON, KENTUCKY, INC., a Kentucky Corporation, Appellee.
• Court: Kentucky Court of Appeals

Page 872

593 S.W.2d 872

HARRY HARRIS, INC., a Kentucky Corporation, Appellant, v. QUALITY CONSTRUCTION COMPANY OF BENTON, KENTUCKY, INC., a

Kentucky Corporation, Appellee.

Court of Appeals of Kentucky.

Aug. 24, 1979.

Rehearing Denied Oct. 19, 1979.

Discretionary Review Denied March 4, 1980.

M. Ronald Christopher, Murray, for appellant.

Richard H. Lewis, James A. Anderson, III, Benton, for appellee.

Before GUDGEL, WHITE and WINTERSHEIMER, JJ.

WINTERSHEIMER, Judge.

This appeal is from a judgment entered August 8, 1978, which awarded the appellee the sum of $12,366.96 on a breach of contract suit.

The appellee is a general contractor engaged in construction work, and the appellant is a subcontractor whose business consists primarily of selling supermarket, hotel, restaurant, bar and slaughterhouse equipment. Appellee had been awarded the bid for construction of three new elementary schools and in arriving at its low bid projections had used the estimates of subcontractor Harris for kitchen equipment. Appellant had inadvertently failed to add in the price of five ovens, representing $8,925.00. Shortly after the appellant became aware of its mistake and on September 6, 1973, it notified the appellee that it would have to withdraw its bid because it would lose $18,000.00 on the transaction. A vice-president of the appellant testified that he offered to supply all kitchen equipment for a total price of $94,711.04, but that offer was not accepted by the appellee who subsequently sought other suppliers. Later the appellant offered to perform at its cost, plus 15%, but the appellee did not accept that proposal. The trial court awarded a total judgment against the appellant in the amount of $12,366.76, apportioned as follows: $9,186.96 representing the difference in the appellant's bid and the next lowest bid; $1,680.00 representing the cost of hood protectors contained in the appellant's bid, but not in the successful bid; and $1,500.00 for the cost of extra labor. This appeal followed.

The appellant argues as follows:

1) Did the general contractor accept the subcontractor's bid offer with the result that there was a binding contract?

2) May a subcontractor, upon discovering a mistake in its computations, withdraw its bid to a general contractor after the general contractor's bid, using the bid of the subcontractor, has been submitted to and conditionally accepted by the owner?

This Court affirms the judgment of the trial court in all respects, except as to the mitigation of damages.

In any case that is presented to the trial court without the intervention of a jury, the standard of review is governed by CR 52.01. Unless it can be demonstrated that the judgment below is clearly erroneous or manifestly against the weight of the evidence, the appellant court will not disturb the findings of the trial judge.

The appellant relies on two cases, Board of Regents of Murray State Normal School v. Cole, 209 Ky. 761, 273 S.W. 508 (1925), and Floyd County Board of Education v. Hooper, Ky., 350 S.W.2d 629 (1961). We believe both of these cases are distinguishable from the factual situation presented here. In both cases the parties were dealing directly with an owner and no subcontractor was involved. Here, we have a subcontractor withdrawing its bid after the general contractor had relied on it in preparing its own bid for the owner. In the Hooper, supra, case, the court noted that the owner's only damage was loss of its bargain. Here, the contractor, because of its reliance on the offer of the subcontractor, lost more than a bargain; it was forced to absorb the damage resulting from the subcontractor's mistake. In the Cole, supra, case, the court determined that the contractor's mistake was fundamental, warranting cancellation of the entire bid.

The evidence in this case indicates that if the subcontractor had fulfilled its...