Louis Lyster, General Contractor, Inc. v. Town of Las Vegas

• Decision Date: 07 September 1965
• Docket Number: No. 7574,7574
• Citation: 405 P.2d 665,75 N.M. 427,1965 NMSC 97
• Parties: LOUIS LYSTER, GENERAL CONTRACTOR, INC. and U. S. Fiedelity & Guaranty Company, a corporation, Plaintiff-Third Party Defendants-Appellants, v. TOWN OF LAS VEGAS and T. E. Scanlon & Associates, Defendants-Third Party Plaintiffs-Appellants, T. E. Scanlon & Associates, Cross-Appellees, Town of Las Vegas, Louis Lyster, General Contractor, Inc., and U. S. Fidelity & Guaranty Company, Cross-Appellees.
• Court: New Mexico Supreme Court

Page 665

405 P.2d 665

75 N.M. 427

LOUIS LYSTER, GENERAL CONTRACTOR, INC. and U. S. Fiedelity &amp Guaranty Company, a corporation, Plaintiff-Third Party Defendants-Appellants, v. TOWN OF LAS VEGAS and T. E. Scanlon & Associates Defendants-Third Party Plaintiffs-Appellants T. E. Scanlon & Associates, Cross-Appellees Town of Las Vegas, Louis Lyster, General Contractor, Inc., and U. S. Fidelity & Guaranty Company, Cross-Appellees.

No. 7574.

Supreme Court of New Mexico.

Sept. 7, 1965.

Henry E. Blattman, Las Vegas, Charles E. Barnhart, Albuquerque, for appellants.

Donald A. Martinez, Las Vegas, for Town of Las Vegas.

Zinn & Donnell, Santa Fe, for T. E. Scanlon & Associates.

CARMODY, Chief Justice.

This action was originally commenced as a declaratory judgment proceeding which sought to determine who was at fault for a defect that developed in the construction of a sewage treatment plant for the Town of Las Vegas, New Mexico. From a judgment in favor of the Town on a third-party complaint, appellant Lyster, together with its surety, prosecute this appeal and the appellee Scanlon has cross-appealed under our Rule 17(2) (Sec. 21-2-1(17)(2), N.M.S.A.1953).

Although there is some discrepancy as to the proper business or legal names of some of the parties, it is of no consequence insofar as this decision is concerned, and, for simplicity, we will refer to the parties only as 'Lyster,' 'Scanlon' and the 'Town.'

Scanlon, an engineering firm, contracted with the Town to design plans for, and supervise construction of, the sewage treatment plant. Lyster entered into a contract with the Town to do the actual construction of the project. The United States Fidelity & Guaranty Company was the surety for Lyster on the project.

Lyster proceeded under the contract and substantially completed the contract with the exception of cleaning the Town's old sewage tank and laying a slab of concrete in the roadway approaching the new sewage treatment facility. Upon testing of the completed sewage treatment facility, a defect or fault in the the structure appeared. The contractor notified the engineer, who immediately drew plans to remedy the defect. Lyster, as an individual, filed a declaratory judgment action against Scanlon and the Town to determine who would pay the cost of approximately $12,500.00 to effectuate the proposed remedy. The Town, by a third-party complaint, sought damages from Lyster and the United States Fidelity & Guaranty Company and also joined Scanlon as third-party defendants. Answers of third-party defendants were filed, with Lyster and United States Fidelity & Guaranty Company cross-claiming against Scanlon, and the Town counter-claiming against Scanlon.

The trial court, sitting without a jury, found that both the contractor and the engineer were in breach of contract, which breaches were contributing causes of the defect that appeared in the construction of the sewage facility. The findings of the trial court fail to determine the specific result of each breach, i. e., there is no determination to proximate cause. On the basis of these findings, the trial court entered a joint judgment against Lyster, United States Fidelity & Guaranty Company and Scanlon in the amount of $19,043.00. Further, the court entered judgment against Lyster and United States Fidelity & Guaranty Company for the additional sum of $15,417.00, plus the amount of $50.00 per weather-working day from and after February 26, 1963, until completion of the sewage treatment plant according to the contract.

Following the appeal, briefs were submitted on behalf of Lyster and Scanlon, but the Town failed to file a brief and therefore our decision will be based only upon the briefs on file.

Although numerous and sundry issues were rasied by appellants' and cross-appellant's briefs, it is only necessary that one of such issues be discussed. That is the point raised by appellants' brief that the trial court's finding of $20,000.00 actual damages and subsequent entry of a judgment for $19,043.00 is unsupported by substantial evidence and therefore constitutes reversible error. Appellants cite us to Simpson on Contract, page 530, for the proposition, 'Damages must be proved with reasonable certainty or only a judgment for nominal damages will be rendered.' Although not in the exact language, this court, in effect, stated the same principle in the case of Nichols v. Anderson, 1939, 43 N.M. 296, 92 P.2d 781, when we stated:

'* * * It is, of course, necessary that damages claimed for breach of any contract be of the kind and character susceptible of proof, and the amount allowed must be subject to reasonable ascertainment.'

See, also, Keller v. Cavanaugh, 1958, 64 N.M. 86, 324 P.2d 783...