J. Louis Crum Corp. v. Alfred Lindgren, Inc.

• Citation: 564 S.W.2d 544
• Decision Date: 27 February 1978
• Docket Number: No. KCD28497,KCD28497
• Parties: J. LOUIS CRUM CORPORATION, a Missouri Corporation, et al., Plaintiffs-Appellants, v. ALFRED LINDGREN, INC., a Missouri Corporation, et al., Defendants-Respondents.
• Court: Court of Appeal of Missouri (US)

Page 544

564 S.W.2d 544

J. LOUIS CRUM CORPORATION, a Missouri Corporation, et al Plaintiffs-Appellants, v. ALFRED LINDGREN, INC., a Missouri Corporation, et al Defendants-Respondents.

No. KCD28497.

Missouri Court of Appeals,Kansas City District.

Feb. 27, 1978.

Motion for Rehearing and/or Transfer Denied April 3, 1978.

Larry M. Woods, Sapp, Woods & Orr, Columbia, Jon M. Wickwire, James J. Tansey, Walstad, Wickwire, Peterson & Gavin, Vienna, Va., for plaintiffs-appellants.

Gene C. Morris, Rogers, Field, Gentry, Benjamin & Robertson, Kansas City, for defendants-respondents, Alfred Lindgren, Inc., Charles Parsons Const., Inc., Parsons-Lindgren Joint Venture and The Pennsylvania Ins. Co.

Roy F. Carter, Morris, Larson, King, Stamper & Bold, Kansas City, B. Daniel Simon, Brown, Wright, Willbrand & Simon, Columbia, for defendant-respondent Havens Steel Co.

Before PRITCHARD, P. J., SWOFFORD, C. J., and DIXON, J.

DIXON, Judge.

Plaintiffs appeal from the trial court action in the dismissal of two counts of their petition against separate defendants. A third count remains pending in the court below. Defendants filed a motion to dismiss on the ground that the orders appealed from were not final appealable orders because of the pending Count III. Upon the briefs submitted, the motion to dismiss was denied.

The dispute arises out of multiple contracts for the construction of the Hearnes Multi-Purpose Complex on the Columbia campus of the University of Missouri. A general statement of the various contracts and the relationship of the parties is necessary for an understanding of the issues.

The work to be constructed was a very large athletic facility, herein referred to as the "project." The contracts involved were originally between the Curators of the University and three contractors. J. Louis Crum Corporation was awarded the prime contract for the mechanical work on the project. Crum subcontracted portions of the work to Harold G. Butzer, Inc. and to Owens-Corning Fiberglass Corporation. All plaintiffs will be referred to as "Crum." Alfred Lindgren, Inc. was awarded the contract for the general construction of the project. Lindgren entered into a joint venture with Charles Parsons Construction, Inc. to perform Lindgren's contract. The joint venture will be referred to as "Lindgren." Various subcontractors were involved, but the issues here presented involve only one such subcontractor, Havens Steel Company, Havens having contracted with Lindgren to furnish and install the structural steel for the project.

During the course of the work on the project, a large crane being used by Havens to place structural steel collapsed. This caused substantial damage to the partially completed structure. The collapse did not directly injure the work of Crum, but the claims for damage are predicated upon added costs accruing to Crum as a result of delays incident to the damage.

Count I, dismissed below, was a claim sounding in contract by Crum as plaintiff against Lindgren as defendant. Count II was a claim sounding in tort by Crum as plaintiff against Havens and The Pennsylvania Insurance Company, which was Lindgren's surety. Because of the disparate nature of the theories of the parties to the separate counts, they will be dealt with separately.

I

In Count I, Crum pleaded that Lindgren was the general contractor under a "prime" contract and that Crum was the mechanical contractor under a "prime" contract, both such contracts being with the University; further, that Crum subcontracted certain steel erection to Havens and that Pennsylvania executed a performance bond for Lindgren. It was further alleged that each of the prime contracts contained paragraphs 9c and 9d in relevant part as follows:

"No contractor shall delay any other contractor by neglecting to perform his work at the proper time. Each contractor shall be required to coordinate his work with other contractors so as to afford others reasonable opportunity for execution of their work. Any costs caused by defective or ill-timed work, including liquidated damages if same are prescribed, shall be borne by contractor responsible therefor."

"Each contractor shall be responsible for damage to Owner's or other contractor's property done by him or men in his employ through his or their fault or negligence. If any contractor shall cause damage to any other contractor, the contractor causing such damage shall upon notice of any claim settle with such contractor by agreement or arbitration."

Crum alleged that a crane under the exclusive management and control of Lindgren and Havens collapsed, causing damage to the partially completed structure which resulted in disruption and delay in the performance of Crum's work under its contract. It was then pleaded that the acts of Lindgren and Havens were a breach of a contractual duty assumed by Lindgren under its contract conditions 9c and 9d, and Lindgren is liable for damages suffered by Crum as a result of the breach. Pennsylvania, it is also alleged, is responsible for the damage by reason of its surety bond.

Crum contends that it is a third-party beneficiary of the contract between Curators and Lindgren and that Lindgren's failure to promptly and on schedule perform its work was a breach of its contractual duty.

Lindgren and Pennsylvania contend that the relied-upon provisions do not create any liability for consequential damages. It appears that no direct damage occurred to the work of Crum. Pennsylvania contends first that there is no liability under Lindgren's contract and, hence, no liability on the part of Pennsylvania. Further, Pennsylvania contends that even if Lindgren is liable to Crum, it did not insure to Crum the performance of the contract.

As Crum notes, in reviewing a petition which has been dismissed on motion, the facts well pleaded are taken as true and the pleader is entitled to all favorable inferences from the facts. Parker v. Sherman, 456 S.W.2d 577 (Mo.1970). Nor is a pleader relegated to a narrow construction of the pleadings. In the face of a motion to dismiss, the pleading is to be given a reasonable intendment. Zuber v. Clarkson Const. Co., 363 Mo. 352, 251 S.W.2d 52 (1952). And the reasonable inferences from the facts pleaded will also be taken in support of the petition. Fitzpatrick v. Federer, 315 S.W.2d 826 (Mo.1958).

The first issue to be determined is the status of Crum as a third-party beneficiary. Lindgren and Pennsylvania do not directly counter this claim, but content themselves with a recital of the principles of contract construction and the assertion that a third-party beneficiary takes the contract as he finds it, all of which may be conceded.

As Crum contends, the primary question of the status of Crum as a third-party beneficiary is to be determined upon the intention of the parties. That intention may be gleaned from the situation of the parties, the facts and circumstances attending the execution of the contract, and the apparent purpose the parties intend to accomplish. Black and White Cabs of St. Louis, Inc. v. Smith, 370 S.W.2d 669 (Mo.App.1963). Lindgren argues that the contract is clear and unambiguous and the situation and circumstances of the parties is not to be considered. That position is much too narrow a view for the issue presented here. By the very nature of third-party contracts, the situation of the parties is an essential factor in determining the rights and duties under the agreement. In the instant case, Crum pleads that it is a "prime" or original contractor with the Curators and that Lindgren occupies the same position under an identical contract. Those contracts were intended to accomplish the overall project in a timely fashion. When the language of the contract set forth above is examined in that factual matrix, it appears that the prime contractor's agreement to perform in a timely fashion ran to the Curators and required that each contractor complete its work in a timely fashion and not impede the work of other contractors.

That coordinate obligation of Lindgren, the general contractor, and Crum, the mechanical contractor clearly imposed by the nature of the project a reciprocal relationship. That one of these contractors could delay the work of the other is clear from the provisions of the contracts dealing with such delay. That the Curators desired to shift the cost of such delay to the party causing the delay is equally apparent.

Crum cites and relies upon M. T. Reed Const. Co. v. Virginia Metal Products Corp., 213 F.2d 337 (5th Cir. 1954), and Visintine & Co. v. New York, Chicago & St. Louis R. Co., 169 Ohio St. 505, 160 N.E.2d 311 (1959), in support of its theory of recovery.

Virginia Metal Products Co. is a case which, although filed in the federal courts, involved the application of the law of Mississippi. In that case, three separate and substantially identical contracts were awarded by the State of Mississippi to construct a library at the state university. These were a general contract, a contract for shelving, and a plumbing and heating contract. The opinion characterizes the contracts as follows:

"These contractors agreed in their respective contracts to coordinate their work and cooperate with each other so as to facilitate and expedite the completion of the building." 213 F.2d at 337-8.

Further recitals in the opinion disclose that the contracts contained agreements to coordinate work similar to and that any cost of defective or ill-timed work should be borne by the party responsible therefor.

The general contractor brought an action against the contractor responsible for the shelving and recovered a jury verdict. The trial court set aside the verdict on the ground that the general contractor was but an incidental beneficiary of the contract between the shelving contractor and the state and could not maintain an action on that contract.

The Fifth Circuit Court of Appeals reversed, holding that the plaintiff was a direct...