Roberts Contracting Co. Inc v. Valentine-wooten Rd. Pub. Facility Bd.
| Decision Date | 27 May 2009 |
| Docket Number | No. CA 08-751.,CA 08-751. |
| Citation | 320 S.W.3d 1,2009 Ark. App. 437 |
| Parties | ROBERTS CONTRACTING COMPANY, INC., Appellant,v.VALENTINE-WOOTEN ROAD PUBLIC FACILITY BOARD and Pulaski County, Arkansas, Appellees. |
| Court | Arkansas Court of Appeals |
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Jack East, III, Little Rock, for appellant.
Mike Wilson, Jacksonville, for appellee.
This case involves a sewer system that was not fully completed. In June 2004, appellant Roberts Contracting Company, Inc. (Roberts), agreed to build and complete a sewer system for appellee Valentine-Wooten Road Public Facility Board (VWR) by April 12, 2005. Although VWR agreed to obtain all necessary easements, it did not resolve disputes with two landowners until very late in the project. Those issues, along with wet weather and a contract dispute between the project engineer, Bond Consulting Engineers, Inc., and Pulaski County, delayed construction. More than a year past the original completion date, with at least one extension granted, Roberts walked off the job and VWR refused to pay all of Roberts's last bill. The sewer system was not operational. Roberts sued VWR for breach of contract, and VWR filed a counterclaim for damages caused by Roberts's failure to complete and repair the system. After a bench trial, the circuit court denied Roberts's claim on the ground that it had not substantially performed, and awarded liquidated damages for the delay to VWR. Roberts then filed this appeal, and VWR cross-appealed. The issues we must decide are whether Roberts substantially performed; whether Roberts may recover for the work it did complete; whether VWR was entitled to liquidated damages; and whether the trial court awarded liquidated damages for the proper period of time. We hold that, although Roberts did not substantially perform, it is entitled to appropriate compensation from VWR, and that the court did not err in awarding VWR liquidated damages.
The contract provided that VWR would pay $2,088,166 for Roberts to build the sewer system, which was to be accepted by the City of Jacksonville, and that, if Roberts did not complete the work on time, it would pay $400 per day until completion. Roberts received an extension from VWR until October 20, 2005, but did not finish the job by then. By fall 2005, Roberts had installed and tested the sewer lines, and had installed five pump stations and the force-main pipes and related equipment. The disputes over the easements across the Pickens and Harris properties, however, had frustrated completion. The pump station on the Pickens property still lacked power, and Mr. Harris had damaged a force main on his property that Roberts had, at VWR's direction, placed outside the easement. The Pickens easement was finally settled in January 2006, but the Harris dispute was not resolved until May 2006. Further, Bond Consulting Engineers stopped its on-site supervision of the job in December 2005 after a dispute with Pulaski County over payment. The parties disagree about whether VWR's failure to fulfill its obligations hindered Roberts's ability to perform and whether VWR agreed to another extension until May 1, 2006. Roberts left the job at this time.
On May 16, 2006, VWR refused to pay Roberts the entire amount of a bill on the ground that it had not completed all of the work. The pay estimate indicated that retainage (from work already performed and partially paid) 1 at that time was $104,408.30, and that Roberts had earned an additional $57,532.50, which had not yet been paid. Roberts refused to perform further and asserted that the purportedly incomplete work was not within the scope of the contract. It also claimed that its ability to perform had been hampered by VWR's failure to perform its obligations. A video inspection performed by Jacksonville Waste Water Utility in November 2006, more than a year after the lines had been successfully tested, revealed numerous defects and debris in the sewer system. Roberts took the position that the problems in the lines had developed during the year-long interval between its completion of the lines and the taping.
Roberts sued VWR for breach of contract, alleging that it had substantially performed, and seeking $162,502.80. Roberts also sued Pulaski County, which was a party to the contract. Pulaski County was dismissed as a party and that portion of the case has not been appealed. VWR denied that Roberts had substantially performed and filed a counterclaim requesting actual damages for Roberts's failure to complete the project. According to VWR, Roberts failed to perform the following contractual obligations: installing a working SCADA system for each pump station; 2 adequately testing its work; completing the sewer system so that it could be accepted by the City of Jacksonville; and, after completing the system, submitting “as-built” drawings. VWR also asked for liquidated damages for delays caused by Roberts.
At trial, Roberts introduced the testimony of Cotton Roberts, the company's president, who prepared the bid; Leigh Ann Pool, a program manager with Central Arkansas Planning and Development District, Inc.; Bradley Roberts, Cotton's son, who works for Roberts and supervised this project; Thomas Bond, with Bond Consulting Engineers; Gregory Wood, an inspector for Bond; and Michael Bolin, a civil engineer. At the conclusion of its case, Roberts moved to amend the pleadings to conform to its proof of damages in the sum of $177,390.80. The court granted this motion. VWR presented the testimony of Mark Wilkins, a civil engineer with the North Little Rock Sewer Department; Robert Williams, the engineering construction manager for the Jacksonville Waste Water Utility; Josh Minton, the project engineer with Bond; and Frank Hood, VWR's chairman. In rebuttal, Roberts presented the testimony of Brad Roberts.
The trial court issued a letter opinion finding that Roberts had not substantially completed 3 the project; that the sewer system was not operational; that VWR had not yet received any benefit from the project; and that Roberts would not suffer forfeiture because it had been paid for the part of the job it had completed. The court noted that the pumping stations had not been tested or turned on because electricity was not provided to them, and that, by the “plain language” of the contract, Roberts had the responsibility for providing electricity. The court stated that Roberts was also required by the contract to provide the SCADA system. It further found that the contract required Roberts to provide the as-built drawings, although, if everything else had been accomplished, the court said that it would have found that Roberts had substantially complied. The court declined to determine whether clean-up was complete, noting the conflicting testimony on that issue. Because VWR offered no admissible evidence on the amount of damages required to repair the sewer system, the court declined to award actual damages to VWR. The court said that it would, however, award liquidated damages from May 1, 2006, which it found was the end of the final extension, to August 24, 2006, when Roberts filed this lawsuit.
The court entered a judgment incorporating these findings and denying Roberts's request for damages because it had not substantially completed the project. In the judgment, the court directed Roberts to provide the SCADA system within 90 days, upon which it would be entitled to receive the contract price, and ordered it to provide VWR with as-built drawings. The court declined to rule on the clean-up work, or to award actual damages to repair the system to VWR, because the evidence was insufficient.4 The court also made the following findings:
In civil bench trials, the standard of review on appeal is whether the trial court's findings were clearly erroneous or clearly against a preponderance of the evidence. Rooke v. Spickelmier, 2009 Ark. App. 155, 314 S.W.3d 718. A finding is clearly erroneous when, although there is evidence to support it, the reviewing court, on the entire evidence, is left with a firm conviction that a mistake has been committed. Id.
A. Substantial Performance
Roberts first argues that the...
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