State Line Contractors, Inc. v. Com.

• Decision Date: 01 July 1969
• Citation: 249 N.E.2d 619,356 Mass. 306
• Parties: STATE LINE CONTRACTORS, INC. v. COMMONWEALTH.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 619

249 N.E.2d 619

356 Mass. 306

STATE LINE CONTRACTORS, INC. v. COMMONWEALTH.

Supreme Judicial Court of Massachusetts, Suffolk.

Argued Feb. 4, 1969.

Decided July 1, 1969.

John E. Sheehy, Asst. Atty. Gen., for the Commonwealth.

Dean E. Nicholson, Lexington, (Samuel H. Cohen, Boston, with him) for petitioner.

Before WILKINS, C.J., and SPALDING, WHITTEMORE, KIRK and REARDON, JJ.

KIRK, Justice.

By this amended petition under G.L. c. 258 State Line Contractors, Inc. (State Line), sought damages for the alleged breach of a contract to construct a section of Interstate Route 495. The petition as amended stated eleven claims, ten of which were based on accounts annexed. The case was referred to an auditor (findings of fact not final) and, after recommittal for further findings, was tried before a judge sitting without jury. G.L. c. 258, § 2. The judge heard the case on the auditor's reports and the testimony of three engineers (called by the Commonwealth) in the Commonwealth's Department of Public Works (D.P.W.). The judge found for the Commonwealth on two claims, and one claim was waived. These are not before us. On eight of the claims he found for State Line for a total of $225,974.45 plus an item of interest. The Commonwealth has made an offer of judgment encompassing three of these eight claims. The dispute now centers on the remaining five claims plus the item of interest.

The Commonwealth's amended outline bill of exceptions alleges error in the denial of its motion to strike portions of the auditor's reports, to the denial of fifteen of its requests for rulings and to the award of interest. We disregard exceptions to the judge's findings. See Stella v. Curtis, 348 Mass. 458, 461, 204 N.E.2d 457.

Our mission under the statute is to determine whether the judge's decision can be supported in law or must as matter of law be reversed. Charles I. Hosmer, Inc. v. Commonwealth, 302 Mass. 495, 498, 499, 19 N.E.2d 800; Arthur A. Johnson Corp. v. Commonwealth, 306 Mass. 347, 351, 28 N.E.2d 465; M. DeMatteo Constr. Co. v. Commonwealth, 338 Mass. 568, 572, 156 N.E.2d 659.

We first summarize the basic facts concerning the formation of the contract as derived from the documentary evidence and from the findings of the judge who adopted the findings of the auditor and made some of his own. The oral evidence heard by the judge in substance affected only the claim herein referred to as the 'Earth Excavation Claim.' The result is that as to all other claims we have before us all that was before the judge and are in as good position as he to decide the claims. Facts of significance to a particular claim will be stated in the opinion when the claim is considered.

THE FORMATION OF THE CONTRACT.

In June, 1962, the D.P.W. issued a 'Notice to Contractors' requesting the submission of proposals for the construction of a section of Interstate Route 495 (including two bridges) in the city of Haverhill. Plans and an estimate of quantities were made available to the bidders. The 'Instructions to Bidders' issued with the notice disclaimed any guaranty that statements of borings or of the estimated quantities were even approximately correct and were explicit that bidders were to rely upon their own investigation and research and not to rely upon any estimates contained in the plans.

On August 21, 1962, contract numbered 9499 was entered into between the Commonwealth and State Line ¹ based upon a proposal submitted by State Line for the work. The contract by reference incorporated the proposal, the 'Notice to Contractors,' certain 'Special Provisions' and the 'Standard Specifications for Highways and Bridges 1953' adopted by the Commissioners of Public Works (the Blue Book).

The contract called for the construction of 1.231 miles of the highway between stations 255 00 and 320 00, ² including the construction of two bridges, one bridge over Newton Road; the other bridge with approach ramps over Amesbury Road. The contract established unit prices for various items, payment to be based upon the quantities of such items actually used, furnished or performed. ³ The contractor was to accept payment as full compensation for all loss or damage arising out of 'any delay or from any unforeseen obstruction or difficulty encountered in the prosecution of the work.' The contract was originally to be completed by July 15, 1964. The date for completion was extended to September 17, 1964, by the D.P.W. and the work was finished on December 2, 1964.

The Blue Book contained articles covering in detail matters pertaining to highway contracts with the Commonwealth, such as alteration of work (art. 22), extra work (art. 23), claims of contractor (art. 58) and scope of payments (art. 78), in addition to other provisions which will be referred to when pertinent.

The D.P.W.'s original cross-section plans for the proposed highway indicated the existence of solid ledge 'in the main highway between Stations 295 and 308 and also in some areas of the North West ramp. In places where ledge was to be encountered, the D.P.W. plans called for construction of one-to-four (fairly steep) ledge slopes. Where no ledge was to be found the plans called for construction of two-to-one (fairly level) earth slopes.' In essence the contract required the contractor to excavate existing terrain which was above the proposed levels for the roadway and to fill those areas which were lower than the proposed levels. Once a roughly level roadbed was laid out the final roadway would be built up in lifts of various gradations of materials topped off by the asphalt surface. From the original estimates and cross-sections and by implication from the inclusion of an item of ordinary borrow it was anticipated that the amount of material excavated from high ground would not be sufficient to fill in the areas of low ground and that there would be no waste materials.

Before commencing work State Line made a survey of the boring plans submitted by the D.P.W. and concluded that the indications of solid ledge on the D.P.W. plans were inaccurate. The D.P.W. resident engineer was so informed. New boring examinations were made by the D.P.W. resident and bridge engineers and no ledge was encountered in the areas shown on the D.P.W. original plans. Additional borings were then made and this information was adopted by the engineer who drew up new cross-section plans indicating no ledge in the line of proposed excavations. These new details required a basic change in the original plans. All slopes would be the less steep two-to-one earth slopes with the result that substantially larger amounts of earth would have to be excavated and disposed of and the one-to-four slopes for ledge would be eliminated.

Preliminary to the necessary changes in plans, discussions between representatives of State Line and 'personnel' ⁴ of the D.P.W. were held during the latter part of 1962 and through the spring of 1963. Under art. 30 of the Blue Book '* * * Where conditions make it necessary or desirable for major deviation from the approved plans, such changes shall be made as specified in Article 22 (Alteration of Work), upon authorization in writing by the Engineer.'

The discussions were directed toward an alteration of the original contract whereby a rest area would be built adjacent to the highway between stations 281 and 298 at the same unit prices as in the original contract. State Line informed the D.P.W. personnel that it would build the rest area at those prices only if it could be constructed simultaneously with the main highway embankment. State Line was advised by the D.P.W. personnel that it could be so done. On March 18, 1963, the district highway engineer in writing outlined to State Line a proposed alteration with estimated additional cost covering in part the use of surplus excavated materials to construct the rest area and to flatten median slopes. The communication ended, 'Please signify your willingness to perform this additional work at contract unit prices in order that the alteration can be prepared.' A copy of this communication was sent to the chief engineer.

On March 27, 1963, State Line advised the D.P.W. in writing that it would perform the proposed alteration No. 1 at the specified prices provided it built the rest area simultaneously with the roadway embankment. In the interval between the letters of March 18, 1963, and March 27, 1963, State Line 'spoke to DPW men regarding their understanding that the rest area and the main road were to be built simultaneously.'

Alteration No. 1 was finally approved by the D.P.W.'s commissioners on April 23, 1963. It bore the approval of the district highway engineer, the construction engineer and the chief engineer of the department. It recited as 'Reason for Alteration: Additional borings taken by contractor give no indication of ledge, also a reappraisal of available preliminary information shows that the presence of solid ledge is doubtful.' The letter of transmittal, signed by the construction engineer, stated that alteration No. 1 calls for 'revising from the designated 1/4 Ledge Slope, as contracted, to the less precipitous 2/1 Earth Slope, as now warranted because of the absence of anticipated ledge; * * * and for the construction of a rest area for which there was no provision in the original design; all the above work between main baseline stations 297 50 and 307 50 and also between stations 2 50 and 8 50 N.W. Ramp at Amesbury Road * * * .' The same letter stated: 'Alteration #1 is considered to be in accordance with the applicable provisions stipulated under Article XXII of the * * * (Blue Book).' ⁵ The schedule annexed to the alteration shows that thirty-five items in the original contract were affected: increases in twenty-seven items and decreases in eight. A far greater number were unaffected; these were not mentioned in alteration No. 1. The item principally affected was item A2--1, roadway earth excavation, by an...