Siefford v. Housing Authority of City of Humboldt

• Decision Date: 05 December 1974
• Docket Number: No. 39382,39382
• Citation: 223 N.W.2d 816,192 Neb. 643
• Parties: , 74 A.L.R.3d 172 Ernest C. SIEFFORD and John C. Beall d/b/a Beall-Siefford Construction Company, Appellants, v. HOUSING AUTHORITY OF the CITY OF HUMBOLDT, Nebraska, et al., Appellees.
• Court: Nebraska Supreme Court

Page 816

223 N.W.2d 816

192 Neb. 643, 74 A.L.R.3d 172

Ernest C. SIEFFORD and John C. Beall d/b/a Beall-Siefford Construction Company, Appellants, v. HOUSING AUTHORITY OF the CITY OF HUMBOLDT, Nebraska, et al., Appellees.

No. 39382.

Supreme Court of Nebraska.

Dec. 5, 1974.

Syallabus by the Court

1. A contractor has the right to recover damages resulting from delay caused by a breach of contract by the other party. Thus, where there is a breach of contract by the owner of the other party, and the breach of contract results in delay in the work of the contractor and the delay in the work causes damage to him, he has a right of recovery in the absence of a 'no-damage clause' or other provisions to the contrary in the contract and even though the contract contains a provision for the extension of time.

2. Damages which are uncertain, conjectural, or speculative as to the existence, nature, or proximate cause thereof are not the basis of a recovery for breach of contract.

3. Damages for breach of contract which are susceptible of definite proof are recoverable only to the extent that the evidence affords a basis of ascertaining their amount in money with reasonable certainty.

4. Evidence not directly contradicted is not necessarily binding on the triers of fact, and may be given no weight where it is inherently improbable, unreasonable, self-contradictory, or inconsistent with facts or circumstances in evidence.

5. Triers of fact have the right to test the credibility of witnesses by their self-interests and to weigh undisputed parol testimony against facts and circumstances in evidence from which a conclusion may properly be drawn that the parol testimony is false.

6. Where a law action is tried to the court without a jury, the finding of the court has the effect of a jury verdict and will not be disturbed on appeal unless clearly wrong.

Allen L. Overcash of Woods, Aitken, Smith, Greer, Overcash & Spangler, Lincoln, for appellants.

Otto Kotouc, Jr., John Kotouc, Humboldt, William L. Walker, Earl Ludlam, Lincoln, for appellees.

Heard before WHITE, C.J., and SPENCER, BOSLAUGH, McCOWN, NEWTON, CLINTON, and BRODKEY, JJ.

BRODKEY, Justice.

This case involves a contract for the construction of a housing project at Humboldt, Nebraska, entered into between the appellant, Beall-Siefford Construction Company a joint venture consisting of John C. Beall and Ernest C. Siefford, hereinafter referred to as Contractor, and the appellee, Housing Authority of the City of Humboldt, Nebraska, hereinafter referred to as Housing Authority. The Housing Authority opened bids for the project on July 14, 1964. The Contractor's bid of $330,228 was low and was approved on August 17, 1964. Notice to proceed on September 8, 1964, was given the Contractor. According to the construction contract between the parties, the Contractor was to complete the dwelling units in 365 calendar days or by September 7, 1965, and the community building 65 days earlier. However, the project was not fully completed and accepted until January 5, 1966, meaning that there was an overrun of time of 162 days for the community building, and 119 days for the dwelling units.

It its amended petition filed on July 10, 1972, the Contractor sets out three causes of action, or, to be more precise, three theories of recovery, against the Housing Authority. The first cause of action is based on the theory of money due under the contract. It alleges the contract price and extras in the amount of $339,462.16, and that Housing Authority has paid $335,832.16 and still owes $3,630, being the amount of liquidated damages withheld by the Housing Authority for delay of the Contractor in performing the contract, and also claims an additional $70,630.21 for additional labor and material plus $2,009.05 for changes in the contract with respect to maintaining the lawns. In its second cause of action, based on the theory of quantum meruit, Contractor claims the sum of $72,639.26 for additional labor and materials, in addition to the $3,630 previously referred to as due under the written contract. Contractor's third cause of action was a claim of damages for breach of contract based on the theory of 'acceleration' as hereinafter discussed. The amount of these damages is again alleged to be $72,639.26, which is claimed in addition to the $3,630 remaining under the original contract. The Housing Authority filed the appropriate responsive pleadings and the pretrial hearing was held upon the matter on June 8, 1973, at which time the issues were limited for purposes of trial and confined to six items, to-wit:

                  I.  Extra work for painting          $ 1,235.00
                 II.  Extra work for carpenter             330.00
                III.  Extra charges related to change
                      order for overhead and profit      1,080.00
                 IV.  Extra charges for lawns and
                      plantings                          2,009.05
                  V.  General damages for breach of
                      contract, including $5,000 for
                      attorney's fees                   72,895.21
                 VI.  Liquidated damages by formula
                      described in the contract          3,630.00
                

The parties also stipulated and agreed that a jury trial of the matter be waived. It was also agreed that to be considered at the trial was Housing Authority's cross-petition for $3,630 for liquidated damages.

Trial to the court of this matter was commenced on July 11, 1973. The court entered its judgment on September 21, 1973, finding that there was due the Contractor from the Housing Authority the sum of $6,874.05, together with interest thereon at the rate of 9 percent per annum, and dismissing the Contractor's causes of action Nos. II and III because of failure to sustain its burden. The court also dismissed Housing Authority's cross-petition. Following the subsequent overruling of the motion for new trial filed by the Contractor, this appeal was perfected to this court. We affirm.

It is to be noted that the amount of the judgment awarded by the District Court of $6,874.05 is the precise total of Items I, IV, and VI of the court's pretrial order, and thus included a recovery by the Contractor of the liquidated damages previously withheld by the Housing Authority for delay in completion of the work in the amount of $3,630. The principal issue to be considered on this appeal is clearly stated by Contractor in its reply brief filed herein as follows 'As appellants' Statement of the Case pointed out, the Sole question before this Court on appeal is whether the District Court should not have entered an order allowing appellants damages for breach of contract by reason of appellee refusing to grant appellants a time extension and forcing appellants to unduly accelerate their performance of the construction contract between appellants and appellees.' (Emphasis supplied.) Contractor contends that the Housing Authority published for the purpose of bids, and supplied defective plans and specifications; and that after the project started Housing Authority changed the work, which disrupted Contractor's work. The Contractor further claims that the Housing Authority hindered and prevented it from performing its work in a timely manner, but at the same time refused to extend Contractor performance time in spite of its requests for same. Instead, it is alleged, the Housing Authority required Contractor to unduly accelerate its work under threat of default and termination of its work as a result of which the Contractor suffered substantial damages.

In its judgment the trial court made a specific finding that: 'The evidence does not support a finding that the Plaintiffs were forced to accelerate their contract performance by reason of the acts, demands, or the requirements of Defendant,' and did not allow the damages claimed by the Contractor for the alleged 'acceleration.'

We first address ourself to an inquiry as to the nature of a cause of action based upon 'acceleration' generally, whether there is such a doctrine recognized in the State of Nebraska, and further, whether under the specific facts of this case and the particular provisions of the contract between the parties, the Contractor herein is entitled to recover damages, providing the amount thereof and the rroximate cause thereof are properly proved by the evidence herein.

The term 'acceleration' is a very general term and certainly cannot be held to encompass reasonable and legal efforts on the part of the owner to induce his contractor, under a construction contract, to increase the pace of construction in order to complete the contract by the completion date agreed upon and set out in the contract between them. This would seem to be particularly true in the case where a contractor was substantially and continually behind his own established and projected schedule under the contract, and where the delay was not caused by a breach of the contract on the part of the owner, or willful hindrance of the contractor's work by the owner.

We have been unable to find any Nebraska cases discussing or applying the doctrine of 'acceleration,' at least by that name. Contractor points out in its brief, however, that federal authorities have recognized the obligation of the government to compensate construction contractors for undue acceleration of their work, and cites in support thereof the following cases: Continental Consolidated Corp. v. United States, 17 CCF, Par. 81,137 (1972); Electronic & Missile Facilities, Inc., ASB CA No. 9031 (July 23, 1964), 1963 BCA, Par. 4338; Appeal of Mechanical Utilities, Inc., ASBCA Nos. 7345 [192 Neb. 648] and 7466 (Oct. 31, 1962), 1962 BCA, Par. 3556. It appears that most of the cases applying and discussing the doctrine of 'acceleration' are decisions or opinions of United States government administrative agencies such as Armed Services Board of Contract Appeals or Board of Contract Appeals, or Appeals to the Court of Claims or to the Federal Courts from such administrative agencies. They principally involve...