Sutton Corp. v. Metropolitan Dist. Com'n

• Decision Date: 31 October 1995
• Docket Number: No. 93-P-1765,93-P-1765
• Citation: 38 Mass.App.Ct. 764,652 N.E.2d 627
• Parties: SUTTON CORPORATION v. METROPOLITAN DISTRICT COMMISSION.
• Court: Appeals Court of Massachusetts

Page 627

652 N.E.2d 627

38 Mass.App.Ct. 764

SUTTON CORPORATION v. METROPOLITAN DISTRICT COMMISSION.

No. 93-P-1765.

Appeals Court of Massachusetts,

Middlesex.

Argued March 14, 1995.

Decided July 21, 1995.

Further Appellate Review Granted Oct. 31, 1995.

Christopher W. Morog, Asst. Atty. Gen. (James A. Sweeney, Asst. Atty. Gen., with him), for defendant.

Harvey B. Heafitz, Newton (Carol McKenna with him), for plaintiff.

Before WARNER, C.J., and SMITH and JACOBS, JJ.

WARNER, Chief Justice.

Sutton Corporation (Sutton), a construction and excavation contractor, brought an action in the Superior Court against the Metropolitan District Commission (MDC) ¹ seeking payment for added expenses incurred during the completion of a public works contract for the installation of sand drains as part of site preparation relative to the project for the replacement of the General Lawrence Bridge in Medford. The case was referred to a master, "facts final," and the parties waived a jury. Following nine days of testimony and requests for findings by both sides, the master issued a final report deciding that Sutton had incurred additional expenses and costs beyond the original contract price for which the MDC was liable as a result of the conditions on the work site. Thereafter, both parties filed objections to the final report. A judge of the Superior Court denied all objections and confirmed the report, and Sutton was awarded judgment against the MDC in the amount of $346,903.72 plus costs. The MDC appealed the finding of liability under the contract. Sutton filed a cross appeal claiming the master's damage award was inadequate.

1. The subsidiary findings of the master are binding upon us unless they are "clearly erroneous, mutually inconsistent, unwarranted by the evidence before the master as a matter of law or are otherwise tainted by error of law." Mass.R.Civ.P. 53(h)(1), as amended, 386 Mass. 1242 (1982). Here, the MDC contests basic facts on appeal without first having filed below specific objections to any findings. Mass.R.Civ.P. 53(h)(2), as amended, 386 Mass. 1242 (1982). When a party makes objections to the findings, as allowed by Mass.R.Civ.P. 53(h)(2), the party must "clearly stat[e] the grounds for each objection and the relief sought."

The rule further provides that judicial review of a question of law that depends upon the evidence presented to the master requires the filing of "a transcript of so much of the proceedings before the master as is necessary to dispose of the objections adequately." Mass.R.Civ.P. 53(h)(3), as amended, 386 Mass. 1242 (1982). The filing of the transcript does not, however, eliminate the need to make the original objections clear and specific. As we said in Libman v. Zuckerman, 33 Mass.App.Ct. 341, 343, 599 N.E.2d 642 (1992), "The filing of the transcript permits an appellant to direct a reviewing court (in the first instance, the trial court) to that transcript concerning points of objection." That also did not occur here.

The MDC's general objections were not sufficient, under the rule, to raise a challenge to the master's subsidiary findings of fact. See Meehan v. North Adams Sav. Bank, 302 Mass. 357, 363, 19 N.E.2d 299 (1939) (decided under earlier rule). Likewise, Sutton's objections, although containing specific references and requests for relief, only contest the master's ultimate conclusions regarding the damage award. Since there is no cognizable challenge to the master's subsidiary findings, we adopt the facts as set forth in his report. "[O]ur function on appeal ... is to determine what disposition of the case is legally required by the master's findings." D. Federico Co. v. Commonwealth, 11 Mass.App.Ct. 248, 249, 415 N.E.2d 855 (1981). Glynn v. Gloucester, 21 Mass.App.Ct. 390, 392, 487 N.E.2d 230 (1986). See also Melrose Hous. Authy. v. New Hampshire Ins. Co., 402 Mass. 27, 31 n. 4, 520 N.E.2d 493 (1988).

2. We briefly summarize the master's pertinent factual findings. After commencing the site preparation, Sutton experienced unanticipated soil conditions in connection with the sand drain installation which made completion of the contract according to the preliminary bid virtually impossible. Sutton notified the MDC that it had encountered a changed condition under G.L. c. 30, § 39N, and requested the MDC to approve the use of a substitute construction method not contained in the original contract in order to complete the project. The MDC denied the existence of a changed soil condition and did not respond to Sutton's request for formal approval of a substitute method. Sutton sought, and the master awarded, added expenses of completing the project according to original contract specifications in the unanticipated soil conditions, including costs for added manpower and materials. The master denied Sutton's claim for additional damages relating to the removal and replacement of certain materials created by the continued use of the work method specified in the contract.

The master concluded that Sutton experienced a changed condition under G.L. c. 30, § 39N, based on the unanticipated difficulties in the performance of the machinery in the unexpected soil conditions. ² A public authority is required to grant an equitable adjustment in the contract price where the subsurface conditions "differ substantially or materially from those shown on the plans or indicated in the contract documents or from those ordinarily encountered and generally recognized as inherent in work of the character provided for in the plans and contract documents." G.L. c. 30, § 39N, inserted by St.1972, c. 774, § 4. At the same time, "[o]n a public construction contract ... if the contractor encounters materially different conditions from those predicted by the plans, specifications, preliminary borings and estimates, the contractor must follow the procedures spelled out in the contract ... to adjust the price before unilaterally accruing expenses to be pursued later on breach of contract or quantum meruit theories." Glynn v. Gloucester, 9 Mass.App.Ct. 454, 460, 401 N.E.2d 886 (1980). D. Federico Co. v. Commonwealth, 11 Mass.App.Ct. at 252, 415 N.E.2d 855. See also Glynn v. Gloucester, 21 Mass.App.Ct. at 395, 487 N.E.2d 230, and cases cited. A contractor who fails to adhere to the strict claim provisions of a public works contract forfeits all rights to recovery of damages or extra compensation unless the agency waives compliance therewith or the contractor is excused from compliance. See e.g., D. Federico Co. v. Commonwealth, 11 Mass.App.Ct. at 252-253, 415 N.E.2d 855; Skopek Bros., Inc. v. Webster Hous. Authy., 11 Mass.App.Ct. 947, 947, 416 N.E.2d 1006 (1981) (discussing waiver); see also D. Federico Co. v. New Bedford Redev. Authy., 9 Mass.App.Ct. 141, 143-144, 399 N.E.2d 1103 (1980) (excuse found).

Sutton's claim for extra costs and expenses beyond the original contract price caused by the unanticipated adverse soil conditions fell within the damages provision contained in Article XVIII of the contract. ³ See Glynn v. Gloucester, 9 Mass.App.Ct. at 460, 401 N.E.2d 886. The master expressly found that "Sutton did not submit to the MDC prior to April 20, 1982, a written statement of the details and amount of its damages resulting from the sand drain installation." Since it did not strictly comply with Article XVIII, Sutton can only recover if it shows that it was excused from compliance or that the MDC waived compliance with the notice and claim provisions by showing "clear, decisive, and unequivocal conduct on the part of an authorized representative of the agency indicating that it would not insist on adherence to the agreement." Glynn v. Gloucester, 9 Mass.App.Ct. at 462, 401 N.E.2d 886. See also D. Federico Co. v. Commonwealth, 11 Mass.App.Ct. at 253, 415 N.E.2d 855.

The master concluded that "Sutton's letter to the MDC ... that it would be seeking damages ... combined with the knowledge of the MDC through the personal observation of its representatives on the project of the problems that Sutton encountered during the installation of the sand drains, and the Complaint filed on April 20, 1982, constitute sufficient notice to the MDC of Sutton's claim." However, knowledge on the part of the public agency alone is not sufficient to support a finding that the agency waived strict compliance with the damage provisions of a public works contract or that compliance was excused. See Glynn v. Gloucester, 9 Mass.App.Ct. at 462 n. 10, 401 N.E.2d 886. The master's finding that the MDC was aware Sutton was incurring additional expenses from extra work and intended to bring a claim for reimbursement does not, without more, support the conclusion that the MDC excused or waived compliance with Article XVIII. See Skopek Bros., Inc. v. Webster Housing Authy., 11 Mass.App.Ct. at 947, 416 N.E.2d 1006.

The master also excused Sutton's failure to follow the claim procedures by concluding that it would have been futile for Sutton to have provided a detailed statement of costs and expenses because the MDC had already denied that a changed condition existed, citing as authority D. Federico Co. v. New Bedford Redev. Authy., 9 Mass.App.Ct. 141, 399 N.E.2d 1103. This conclusion cannot stand. D. Federico Co. v. New Bedford Redev. Authy., supra, is distinguishable because the claim provision of the contract in that case only required the contractor to...