J. R. Graham & Son, Inc. v. Randolph County Bd. of Ed.

• Decision Date: 19 March 1975
• Docket Number: No. 7419SC1017,7419SC1017
• Citation: 25 N.C.App. 163,212 S.E.2d 542
• Parties: J. R. GRAHAM, AND SON, INC. v. The RANDOLPH COUNTY BOARD OF EDUCATION.
• Court: North Carolina Court of Appeals

Page 542

212 S.E.2d 542

25 N.C.App. 163

J. R. GRAHAM, AND SON, INC. v. The RANDOLPH COUNTY BOARD OF EDUCATION.

No. 7419SC1017.

Court of Appeals of North Carolina.

March 19, 1975.

Schoch, Schoch, Schoch & Schoch by Arch K. Schoch, High Point, for plaintiff appellee.

Miller, Beck, O'Briant and Glass by G. E. Miller, Asheboro, for defendant appellant.

ARNOLD, Judge.

Defendant contends that the contract documents, including the standard AIA contract, preclude plaintiff's recovering the relief granted by the trial court. Upon a voluminous record, the court made detailed findings of fact. It is for this Court to inquire whether these findings are supported by the evidence and whether they support the conclusions of law.

The North Carolina Supreme Court has said:

'Obviously, as an elementary general proposition, a contractor is not liable under a clause for liquidated damages based on a time limit if his failure to complete the contract within the specified time was wholly due to the act or omission of the other party in delaying the work, whether by omitting to provide the faculties (sic) or conditions contemplated in the contract to be provided by him, or by those for whom he is responsible, or by interfering with the work after the contractor has begun, or otherwise. Dunavant v. Caldwell & N.R.R., 122 N.C. 999, 29 S.E. 837; United States v. United Engineering & Contracting Co., 234 U.S. 236, 34 S.Ct. 843, 58 L.Ed. 1294; Anno. 152 A.L.R., p. 1350; 22 Am.Jur.2d, Damages § 233; 25 C.J.S. Damages § 115, p. 1096. The concept of justice back of the decisions appears to be that the other party should not be allowed to recover damages for what he himself has caused.'

Reynolds Co. v. Highway Commission, 271 N.C. 40, 50, 155 S.E.2d 473, 482 (1967). See also Annot. 152 A.L.R. 1349 (1944); 5 A. Corbin, Contracts, § 1072 (1964).

Plaintiff's evidence tended to show and the trial court found that the delay in completing the project was caused by defendant's failure to pay plaintiff on time, defendant's failure to provide water for and a road to the job site, the failure of the heating contractor employed by defendant to install the heating system on time, and bad weather. The court further found that delay was caused by the 'ineptness of the architect, Hammond, and his lack of cooperation with Graham and the other contractors.' Defendant nevertheless contends that plaintiff's failure to request an extension of time under the terms of the contract constitutes a waiver of grounds for delay. While defendant's position is generally tenable, See e.g., Austin-Griffith, Inc. v. Goldberg, 224 S.C. 372, 79 S.E.2d 447 (1953), we believe the facts belie the reasoning behind it. The record shows that when plaintiff on 19 February 1968 requested a 60-day extention, it was ignored. Plaintiff had every reason to expect that additional requests would be futile. Defendant was well aware of the difficulties being encountered at the job site. Moreover, defendant did not execute the change order for the remainder of the contract price until 12 September 1968, more than a month after the 300-day construction period elapsed. Defendant clearly had waived any expectation of adherence to the original contract schedule. On the basis of these facts, plaintiff was not required to submit further requests for extention of time and defendant was not entitled to withhold liquidated damages.

As a general rule, when the contract so provides, the architect's certification is a condition precedent to the contractor's recovery of installment payments, absent a showing of bad faith or failure to exercise honest judgment. 13 Am.Jur.2d, Building and Construction Contracts § 37. In the case at bar, the evidence tended to show and the trial court found that plaintiff submitted valid estimates and failure to approve them was an 'intentional, arbitrary and capricious delay on the part of Hammond in an effort to delay the payments to Graham for the reason that defendant did not have funds available to pay Graham on said estimates.' Defendant contends that plaintiff's remedy was to stop work under a contract provision until payment owed was received. If, as defendant also contends, Hammond's refusal to certify requests for payment was because the project was behind schedule, a work stoppage by the general contractor would only have compounded the problem. We do not read the contract to mean that plaintiff must jeopardize the entire project when defendant wrongfully refuses payment. The trial court's findings, based on plenary evidence, support the award of interest on late payments.

The trial court also concluded that plaintiff was entitled to recover the cost of additional work not called for in the contracts. Defendant contends that plaintiff failed to request additional sums through written change order as required by the contract. This was not necessary to effect the agreement:

"The provisions of a written contract may be modified or waived by a subsequent parol agreement, or by conduct which naturally and justly leads the other party to believe the provisions of the contract are modified or waived. Mfg. Co. v. Lefkowitz, 204 N.C. 449, 168 S.E 517; Bixler v. Britton, 192 N.C. 199, 134 S.E. 488. This principle has been sustained even where the instrument provides for any modification of the contract to be in writing. Allen v. Bank, 180 N.C. 608, 105 S.E. 401.' Whitehurst v. FCX Fruit and Vegetable Service, 224 N.C. 628, 32 S.E.2d 34, 39.'

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