John W. Johnson, Inc. v. Basic Construction Co.

• Decision Date: 20 November 1968
• Docket Number: Civ. A. No. 429-66.
• Citation: 292 F. Supp. 300
• Parties: JOHN W. JOHNSON, INC., a corporation, Plaintiff, v. BASIC CONSTRUCTION CO., Inc., a corporation, et al., Defendants.
• Court: U.S. District Court — District of Columbia

292 F. Supp. 300

JOHN W. JOHNSON, INC., a corporation, Plaintiff, v. BASIC CONSTRUCTION CO., Inc., a corporation, et al., Defendants.

Civ. A. No. 429-66.

United States District Court District of Columbia.

November 20, 1968.

John P. Arness and James E. Murray, Washington, D. C., for plaintiff.

Alexander M. Heron and John A. Whitney, Washington, D. C., for defendant Basic Construction Co.

John F. Myers, Washington, D. C., for defendant Stone.

OPINION

HOLTZOFF, District Judge.

This is the trial of an action for breach of contract, negligence and interference with contract rights brought by a subcontractor against a prime contractor on a project for the construction of a group of public buildings in Albany, New York, and against the architect in charge of supervision of the operation. The project comprised the erection of a group of buildings for the State University of New York located in Albany, New York. The University is an educational institution maintained and conducted by a governmental entity entitled State University Construction Fund.

The defendant, Basic Construction Company, by contract with the State University Construction Fund as the owner, dated December 21, 1963, undertook to erect the buildings involved in this case. The cost of the work aggregated approximately $25,000,000. The defendant, Edward Durell Stone, was the supervising architect engaged by the owner by a contract dated April 1, 1963. The plaintiff, John W. Johnson, Incorporated, a District of Columbia corporation, was a subcontractor for painting buildings and covering the walls, pursuant to a subcontract with Basic, dated March 16, 1964. The subcontractor was to be compensated in the sum of $275,000. The plaintiff claims that the defendants improperly and illegally interfered with the performance of its undertaking and accordingly brings this action for damages. The defendant, Basic, counterclaims for the cost of completing the work that the plaintiff had failed to finish.

At the outset something should be said about the functions of the architect as defined by the contract between him and the owner. In brief, in such a project, the architect acts in a dual capacity. He was to prepare the plans, advise the owner and supervise the performance of the construction contract. In this respect he acted as the agent of the owner. In addition, the architect was named as an impartial arbitrator of disputes that might arise under the contract between the owner and the contractor. Thus, the architect performed a dual function and acted in two different capacities. The legal position of such an architect or an engineer, which is very frequent in public construction projects, is discussed at length in considerable detail by the Court of Appeals for the Ninth Circuit, in the case of Lundgren v. Freeman, 307 F.2d 104, 116. The architect was given, also, express authority to direct the contractor to cancel any subcontract, if he determined that the subcontractor was incompetent, careless or uncooperative.

Obviously, the architect in the performance of his duties as the owner's agent, may delegate their performance to subordinates. In this instance he assigned it to two members of his staff, one of whom was permanently stationed at the site of the project. The architect's function as an arbitrator, however, may not be delegated. An agreement to arbitrate which names a specific arbitrator, necessarily contemplates that the arbitrator will personally make decisions, unless the agreement otherwise specifies, which was not the case here. The arbitrator's acts are somewhat analogous to a quasi-judicial process.

The plaintiff's subcontract provided that changes might be ordered by the contractor during the progress of the work and that compensation would be adjusted accordingly. There was, however, an emphatic provision to the effect that no additional compensation would be payable to the subcontractor unless the extra work was ordered in writing by the contractor.

There has been a great deal of oral testimony, and numerous documents such as letters and memoranda, have been introduced in evidence during the lengthy trial. The salient facts, however, are few and most of them are not controverted. After the exterior of some of the buildings was completed, the plaintiff began the work of painting in the summer and fall of 1965. After awhile the paint on the ceilings of one of the buildings began to peel. An investigation of this unexpected turn of events was promptly undertaken. The architect hired an expert to study the subject. It was finally ascertained that the cause of the peeling was the presence, in the ceiling of stearic acid which had been used by the contractor to aid in removing the temporary molds or "forms" as they are known, that had been employed in erecting the arched ceilings. The conclusion was reached that the contractor had improperly failed to remove the stearic acid, as he should have done before the subcontractor began to paint. It was determined that a third coat of paint should be applied in order to cure the trouble, although the original specifications required only two coats.

The contractor then instructed the plaintiff to apply a third coat of paint. The latter requested a change order or some other written assurance that the contractor would reimburse him for the cost of the extra work. The subcontractor was entitled to it in view of the provision of the contract that no additional compensation would be payable for any extra work unless it was ordered in writing by the contractor. The contractor declined to give any such assurance as was requested by the subcontractor.

Apparently the contractor's position was due to the fact that there was an unsettled dispute between him and the owner as to which of the two should eventually bear the additional expense. This dispute...