McCree & Co. v. State
| Decision Date | 01 August 1958 |
| Docket Number | No. 37316,37316 |
| Citation | 253 Minn. 295,91 N.W.2d 713 |
| Parties | McCREE & COMPANY, Respondent, v. STATE of Minnesota, Appellant. |
| Court | Minnesota Supreme Court |
Syllabus by the court.
1. The state's contention that the plaintiff's complaint fails to state a claim upon which relief can be granted under M.S.A. § 161.03, subd. 17, has no support in the record.
2. It is clear that the action in the instant case is not maintainable without pleading and proving the contract, and since the gist of the action is the breach of the contract, it is in substance, whatever may be the form of the pleading, an action on the contract. The basis for the present action is the alleged breach by the state of the contract, growing out of the representations it made therein.
3. Where the contractor is bound to construct or build according to plans and specifications prepared by the owner, the contractor will not be responsible for the consequences of defects in the plans and specifications.
4. In contracting cases one of the main reasons assigned for supporting an implied warranty based upon the plans and specifications is the control exercised by the owner (the state in this instance) in dictating the contract, furnishing the plans and specifications, and direcing details of the work.
5. The rule is that the act of the owner in furnishing the plans and specifications as well as dictating the terms of the contract amounts to a warranty of their fitness and that, where one party furnishes plans and specifications for a contractor to follow in a construction job and exercises control throughout in the details of the work, he thereby impliedly warrants their sufficiency for the purposes implicit therein, and whether the contractor has been damaged in proceeding with the work in reliance on such an implied warranty or whether he was damaged in relying on the warranty in making his bid, he may recover. In the instant case the contractor was given no right to take corrective action, even though the plans and specifications proved inadequate for completion of the work, until such authority came from the state.
6. The evidence in the case at bar, viewed as a whole, demonstrates that the owner's actions in furnishing detailed plans and specifications controlled not only the particular result to be accomplished but also the particular construction methods to be followed and used and supports an implied warranty in keeping with the intention and expectation of the parties that the plans, specifications, and soil conditions were such as would permit successful conclusion of the work.
7. The court's instructions on 'implied warranty' and on the measure of damages were substantially correct as to the rules of law applicable to the facts herein. The court instructed fully and sufficiently on both issues and there was no prejudicial error.
8. The record discloses ample evidence to support the amount of the jury award.
9. We find no prejudicial error either in the reception of the evidence or in the court's instructions with reference to the measure of damages or to difficulty in assessing damages.
10. The trial court did not err in denying defendant's motion to strike paragraphs 6, 7, 8, and 9 and part of paragraph 4 of plaintiff's amended complaint; nor in its denial of defendant's motion to strike all of plaintiff's testimony relating to costs of compaction; nor in refusing to grant defendant's motion for a directed verdict at the close of the evidence on any of the grounds upon which it was urged.
Miles Lord, Atty. Gen., Robert W. Mattson, Deputy Atty. Gen., D. P. Kane, Sp. Asst. Atty. Gen., for appellant.
Roland J. Faricy, B. Warren Hart, Marvin J. Pertzik, St. Paul, Faricy Moore & Costello, St. Paul, of counsel, for respondent.
McCree & Company brings this action against the State of Minnesota to recover damages for an alleged breach of warranty arising out of a contract for the improvement of Trunk Highway Nos. 14 and 22 in southern Minnesota, in the vicinity of the city of Mankato, and also to recover an amount which has been withheld by the state. The Highway Department engineers started work in the fall of 1950 on plans and specifications for the improvement. Subsequent to April 2, 1951, the state advertised for competitive bids, and, within 15 days after receiving notice of the advertisement for bids, plaintiff submitted its bid bearing date April 27, 1951. The contract was let to plaintiff as low bidder on the same date. A formal contract, drafted in its entirety by the state, was thereafter entered into between the parties pursuant to existing highway regulations and requirements.
The plans and specifications, which were made a part of the contract, required the plaintiff to compact the soil used as embankment material to a specified density tested by the standard laboratory method of tests for the compaction and density of soils. Relying upon the state's plans and specifications providing for strict compliance under supervision and inspection by the state's engineers, plaintiff contends that it was led to believe and did believe that the soil materials could be compacted as specifically required by the state therein. The plaintiff as contractor was given no right to deviate from the plans and specifications under the contract provisions. The following contract clauses are indicative of the extent to which the terms of the contract were obligatory upon plaintiff both as to performance and the accomplishment of results. Section 1401 states that Section 1502 states 'All work shall be done in accordance with the lines, grades and dimensions shown in the Plans except as otherwise ordered by the Engineer.' Section 1509 states 'Any unauthorized work may be ordered removed and replaced at the Contractor's expense.'
We think it clear from the foregoing that one of the main issues presented on this appeal is whether the state impliedly represented and agreed in its contract with plaintiff that soil conditions at the work site were such as to make it practicable to perform the prescribed work pursuant to plans and specifications; that the provisions of the contract contained practicable directions for doing and completing the work; and that these were adequate and sufficient for the purposes therein stated.
The testimony on behalf of the plaintiff is to the effect that it was compelled to rely and did rely upon the representations and agreement on the part of the state that the soil conditions were suitable and sufficient to make it practicable to comply with the plans and specifications and for the plaintiff to perform the work to completion in the very definite and specific manner prescribed. The plaintiff had been obligated by the terms of the contract to compact the embankment material between what has been described as stations 31 and 46 to a degree of density specifically required in the plans and specifications. However, in an attempted course of construction throughout the area between stations 31 and 46 plaintiff found it impossible to get compaction to the specified density. It is contended by plaintiff that this was due to the wet condition of the underlying soil and its plastic nature in that area which made it impossible to accomplish compaction by the methods prescribed and definitely required in the plans and specifications prepared and furnished by the engineers for the state.
A reading of the record indicates that the conditions at the work site made it obvious that compaction could not be achieved under the state's plans and specifications without the state's authorization to deviate therefrom. Plaintiff brought these facts to the attention of the state's engineers as soon as the conditions were discovered shortly after commencement of the job on June 4, 1951, and suggested the corrective action needed. It is to be noted that the plaintiff had entered into a contract to do specified work in a specified manner for which payment was to be made on a unit basis; that it commenced work on the project June 4, 1951; and that it was obligated under the terms of the contract to complete the construction work and accomplish the required results by October 15, 1951. Although there was state inspection from the beginning of the project and the state was notified almost immediately regarding the conditions between stations 31 and 46, no change order appears to have been executed on behalf of the state permitting plaintiff to take corrective action, as suggested, by installing perforated drainpipe in the subgrade and using gravel fill rather than a clay fill until order No. 9 was issued in September 1951. This order permitted plaintiff to lay only 800 feet of perforated pipe in the area where these compaction difficulties had been encountered. It was found that that was not sufficient. The compaction difficulties continued to exist in the balance of the area and yet no change order giving plaintiff permission to take similar corrective action throughout the remaining area was issued until May 12, 1952, as change order No. 11, permitting the installation of an additional 900 feet of perforated drainage pipe. The latter change order finally solved the matter so that the plaintiff could go on to a completion of the project.
While the plaintiff under the terms of the contract was required to complete the job by October 15, 1951, it appears that the completion time had to be extended to the month of June 1952. Because of the delay due to the unforeseen wet and plastic soil condition plaintiff was forced to carry over through the winter. It had to provide and spread gravel for winter protection, incur expenses for extra labor and extra use of equipment which could otherwise have been avoided. The construction work was not finally accepted by ...
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