Scott Addison Const. Inc. v. Lauderdale County School System
| Decision Date | 19 April 2001 |
| Docket Number | No. 2000-CA-00311-SCT.,2000-CA-00311-SCT. |
| Citation | 789 So.2d 771 |
| Parties | SCOTT ADDISON CONSTRUCTION, INC. v. LAUDERDALE COUNTY SCHOOL SYSTEM. |
| Court | Mississippi Supreme Court |
Christopher Solop, Jackson, Attorney for Appellant.
Mark D. Herbert, Jackson, Attorney for Appellee.
Before PITTMAN, C.J., COBB and DIAZ, JJ.
¶ 1. This is an appeal by Scott Addison Construction, Inc. ("Addison") from the Circuit Court of Lauderdale County. On November 24, 1999, Addison filed a Demand for Arbitration against the Lauderdale County School System ("School System"). In response, the School System filed an Application to Stay Arbitration. Addison in turn filed an Application for Order to Proceed with Arbitration. Both parties briefed the circuit court, and a hearing was conducted on February 11, 2000. On February 14, 2000, the circuit court issued a Memorandum Opinion and Judgment granting the School System's application. Aggrieved, Addison filed a timely appeal to this Court.
¶ 2. Some facts in this case are disputed. The following recitation reflects the trial court's findings of fact, while noting any conflicts claimed to exist. The Lauderdale County School System advertised for bids for the construction of the new West Lauderdale Elementary School for the Lauderdale County School System. In the bid documents, the School System indicated that the contract form documents would be promulgated by the American Institute of Architects ("AIA"). Included in the bid documents was a copy of the short form of the contract, AIA Form 101. The bid documents also indicated that the contract would include by reference AIA Form A-201, known as the "General Conditions." Form AIA A-201 is a preprinted form document which is incorporated by reference in AIA 101 and is not signed by the parties. The bid documents that were published did not refer to the practice of the School System to delete any provisions for arbitration in the General Conditions.
¶ 3. The bids were opened on April 8, 1999. Scott Addison Construction, Inc. submitted the lowest and best bid for the construction of the elementary school. The Lauderdale County School Board of Trustees accepted the bid of Addison Construction on April 15, 1999, and Addison was in attendance at that meeting. On April 26, 1999, the School Board approved the entering of a construction contract with Addison, and also formally adopted the form of the contract and authorized the execution of that form of the contract. The form of the contract adopted by the Board on April 26, 1999, included a form of the A-201 General Conditions which had all provisions relating to arbitration deleted. The minutes of the meeting on that date have attached an executed copy of the contract dated April 28, 1999.
¶ 4. On April 28, 1999, Addison and County officials met in a preconstruction conference to discuss various issues and to execute the contract. The testimony of the parties at this point diverges. According to the testimony of John Compton ("Compton") and David Little ("Little"), the deletion of the arbitration clauses was discussed with Scott Addison prior to the execution of the contract. Compton testified that it was the practice of the School District to always delete any reference to arbitration from construction contracts. He testified that he slid the portion of the contract referred to as the General Conditions over to Addison and told him that the provisions for arbitration had been deleted. Compton further testified that Addison stated that it was "No problem," or words to that effect. The testimony of Little, the Superintendent of Education, corroborated that of Compton on this issue. Compton stated that Addison did have a problem with the scheduling of the construction and that there was a discussion concerning Addison's concerns. Further, there was a discussion concerning a $20,000 amendment to the cost of construction. According to Compton, Addison did not appear to be concerned about the deletion of the arbitration clause from the General Conditions portion of the contract, and no further discussion occurred at that time regarding the deletion. The parties then executed the construction contract.
¶ 5. Addison, however, claims that he did not agree to the School System's attempt to delete the requirements for arbitration of disputes from the contract. Addison, who testified live and by affidavit, contends that he expected the arbitration provisions of the A-201 General Conditions to be included in the terms of the contract. Addison argues that it was not until after he signed the A101 contract document that Compton told him the arbitration provisions had been stricken from the A-201 "General Conditions," and that there had been no prior discussions whatsoever regarding deletion of the provisions.
¶ 6. Addison corresponded on numerous occasions with the School Board regarding his concerns about the scheduling of the construction. The trial court noted that Addison's concerns are well documented. Addison did not however, in any of his correspondence, object to the deletion of the arbitration provisions in the contract. Future concerns notwithstanding, Addison Construction proceeded with the construction of the elementary school.
¶ 7. The trial court found that there was persuasive evidence that the parties agreed to the deletion of the arbitration provisions prior to the execution of the contract, but that, even if the parties did not agree, Addison waived any objection to said deletion by his subsequent conduct.
¶ 8. Whether the construction contract contained an arbitration clause at the time it was executed is a factual issue to be resolved by the trial judge. Conflicting testimony in the record is to be resolved by the trier of fact. Further, "[i]t is enough to say that the [trial judge sitting without a jury], and not the reviewing court, judges the credibility of the witnesses as well as the weight and worth of their conflicting testimony." Burrell v. State, 613 So.2d 1186, 1192 (Miss.1993). The trial judge's conclusions will not be disturbed on appeal where there is substantial supporting evidence in the record, even if this Court might have found otherwise as an original matter. Murphy v. Murphy, 631 So.2d 812, 815 (Miss.1994). The reviewing court must examine the entire record and must accept, "that evidence which supports or reasonably tends to support the findings of fact made below, together with all reasonable inferences which may be drawn therefrom and which favor the lower court's findings of fact." Cotton v. McConnell, 435 So.2d 683, 685 (Miss.1983) (quoting Culbreath v. Johnson, 427 So.2d 705, 707-08 (Miss.1983)). This Court review errors of law de novo. Cummings v. Benderman, 681 So.2d 97, 100 (Miss.1996).
¶ 9. Addison argues that this appeal involves errors involving both factual and legal issues. Addison argues that the appropriate standard of review is de novo for two reasons. First, he asserts that the circuit court erred as a matter of law when it applied the common law definition of "waiver" to Addison's failure to object to the School System's deletion of arbitration provisions from the contract. Second, Addison argues that there was an "implicit" finding in the trial court's judgment that there had been a "modification" to the contract. Addison claims that the circuit court misapplied the law to the facts when it "gave effect to a modification" that was not supported by any consideration. The School System argues that the trial court's findings regarding whether the construction contract contained an arbitration provision and whether Addison's conduct waived that provision are pure determinations of fact.
¶ 10. The circuit court determined the sole issue to be "whether the contract entered into by the parties on April 28, 1999 contains any provisions for arbitration of disputes," and the court addressed this issue as a question of fact. This Court will address the issues of whether the parties agreed to delete the arbitration provisions and whether the evidence supports a finding of waiver as factual issues. However, the issue of whether the trial court should have applied the common law or the statutory definition of waiver is a question of law which will be reviewed de novo by this Court. Likewise, the issue of whether the change in the contract constituted a modification requiring consideration is a legal question requiring de novo review.
I. WHETHER THE TRIAL COURT ERRED IN FINDING THAT ADDISON WAIVED HIS RIGHT TO AN ARBITRATION PROVISION IN THE CONTRACT.
¶ 11. Addison contends that the circuit court erred as a matter of law when it concluded, based on common law principles, that he had waived the right to any arbitration provisions in the contract. Addison argues that under Miss.Code Ann. § 11-15-103 (Supp.2000), entitled Arbitration of Controversies Arising from Construction Contracts and Related Agreements, waiver may only occur if a party resorts to litigation or fails to object to litigation if the other party initiates it. The statute provides in pertinent part:
Two or more parties ... may include in a written contract a provision for the settlement by arbitration of any controversy thereafter arising between them relating to such contract ... Such [arbitration] agreement or provision shall be valid, enforceable and irrevocable without regard to the justiciable character of the controversy. Provided, however, that in the event either party to such an agreement initiates litigation against the other with respect to such agreement, such arbitration provision shall be deemed waived unless asserted as a defense on or before the responding party is required to answer to such litigation.
Miss.Code Ann. § 11-15-103 (Supp.2000) (emphasis added). Addison...
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