T.W. Morton Builders, Inc. v. von Buedingen
| Decision Date | 08 February 1994 |
| Docket Number | No. 2235,2235 |
| Citation | 450 S.E.2d 87,316 S.C. 388 |
| Court | South Carolina Court of Appeals |
| Parties | T.W. MORTON BUILDERS, INC., Plaintiff, v. Richard P. von BUEDINGEN, Individually, and C. Clifton Alsbrooks, as the Personal Representative of the Estate of Bari L. von Buedingen, and NCNB National Bank of South Carolina, f/k/a NCNB South Carolina, Defendants. WILLIAMSBURG FENCE COMPANY, Plaintiff, v. Richard P. von BUEDINGEN, a/k/a Richard P. von Buedingen Philippseich, Individually, and C. Clifton Alsbrooks, as the Personal Representative of the Estate of Bari L. von Buedingen, a/k/a Bari L. von Buedingen Philippseich, and NCNB National Bank of South Carolina, f/k/a NCNB South Carolina, Defendants. Herbert A. JONES, Plaintiff, v. Richard P. von BUEDINGEN, a/k/a Richard P. von Buedingen Philippseich, Individually, and C. Clifton Alsbrooks, as the Personal Representative of the Estate of Bari L. von Buedingen, a/k/a Bari L. von Buedingen Philippseich, and NCNB National Bank of South Carolina, f/k/a NCNB South Carolina, Defendants, of whom T.W. Morton Builders, Inc., is Respondent-Appellant, and Richard P. von Buedingen, Individually, and C. Clifton Alsbrooks, as the Personal Representative of the Estate of Bari L. von Buedingen, are Appellants-Respondents. . Heard |
John W. Harte and Gregory P. Harlow, Aiken, for appellants-respondents.
Richard E. Miley, North Augusta, for respondent-appellant.
T.W. Morton Builders, Inc. brought this foreclosure action pursuant to the von Buedingens' alleged failure to pay in full for renovations performed on their home. The von Buedingens counterclaimed for, among other things, breach of contract and unfair trade practices. The master held in favor of the contractor for $116,434.88. Both parties appeal. We affirm in part, reverse in part and remand.
After purchasing a $500,000 home at 1500 Huntsman Drive in Aiken, South Carolina, the von Buedingens sought bids for considerable renovations to the home, including the addition of a master bedroom/bathroom wing, a horse barn, and other significant improvements.
They received bids on the proposed renovations, including a bid from T.W. Morton for $540,000, which they rejected outright. The von Buedingens also rejected T.W. Morton's second bid of $425,000. After a meeting, however, at which the parties discussed further scaling down of the project, the von Buedingens accepted T.W. Morton's third bid of $370,690.
The contract between the parties was an American Institute of Architects form contract entitled "Standard Form of Agreement Between Owner and Contractor." The initial language of the form provides that the basis of payment is the "Cost of the Work Plus a Fee." 1 Elsewhere, the contract provides:
The maximum cost to the Owner, including the Cost of the Work and the Contractor's Fee, is estimated to be the sum of THREE HUNDRED SEVENTY THOUSAND, SIX HUNDRED NINETY AND 00/100 dollars ($370,690.00); such Maximum Cost shall be increased or decreased for Changes in the Work as provided in Article 7. A ten percent deposit is due upon execution of this contract in the amount of $37,069.00. 2
Other pertinent sections of the contract include:
COSTS NOT TO BE REIMBURSED
....
9.1.6 Costs due to the negligence of the Contractor, any Subcontractor, anyone directly or indirectly employed by any of them, or for whose acts any of them may be liable, including but not limited to the correction of defective or nonconforming Work, disposal of materials and equipment wrongly supplied, or making good any damage to property.
7.3 Any Changes in the Work which result in additional costs to the Contract will not become effective until Change Orders are signed by the parties or their representatives, and the funds are on deposit in the construction account at NCNB. 3
Ted Morton of T.W. Morton testified this form contract was an AIA cost plus contract form, and denied he would have ever agreed to a fixed price contract on the project.
After construction began, the contract requirement of obtaining signed change orders for each change was not observed. According to Charles Horton, the job superintendent on the project, and Ted Morton, not all changes were put into change orders because the orders would have slowed the progress of the project, particularly when the changes became so frequent. Morton testified changes were made daily, and that the number of changes ultimately made strict compliance with the contract impossible. Morton also testified that Dr. von Buedingen never complained the change order procedure was not followed, and did not insist on written change orders even once the overruns were apparent. Dr. von Buedingen furthermore did not establish a construction account as provided in the change order provision of the contract.
Ultimately, the final cost well exceeded the total of the bid plus written, authorized change orders. The final costs for the renovation project totalled approximately $654,000.
Horton testified to the various changes requested during the course of construction. He attributed a number of the changes to Wesley Cadle, the von Buedingens' interior decorator. According to Horton, Cadle insisted interior trim work be removed and then re-done after the wallpapering. The trim itself was also more detailed than the plans indicated and required extra labor. Cadle also directed the installation of cabinets in Mrs. von Buedingen's bathroom, which were not in the original plans, and requested expensive flextrim on the radius and porthole windows be redone, for reasons unrelated to workmanship, at an additional cost of $2,300.
Several witnesses testified to numerous other changes made involving extra expense. The hardwood floors were refinished; extra marble work was added to the old fireplace; electrical work was done in the old house; doors were replaced in the old house; the front bay window was raised; an access door was moved; changes were made in the framework; a vent and certain outlets were moved; trim was re-applied to the bay windows; extra plywood was added to the sunroom floor; 4 a column in front of the house was changed; the barn doors were rebuilt; fencing was removed from the backyard; a room was added in the garage; the barn was enlarged; a well was added; and several additional tons of dirt were removed at the start of the project. Costs were also increased by the considerable delays resulting from these changes.
Costs mounted further when Dr. von Buedingen demanded the sunroom be re-built with a different slope to the roof. Apparently, the original plans showed sloped roofs on the bay, but were not clear as to the sunroom. Horton and the framing contractor both believed the original roof line complied with the plans. However, Dr. von Buedingen insisted on the change, and the second roof proved to be more difficult and expensive to build. The framing contractor estimated the extra framing work on the sunroom totalled $7,500. A separate sub-contractor, Richard Bragg, testified the second roof was more complicated and required double the amount of copper, excluding the wasted copper torn from the first roof.
A dressage arena was added at considerable cost. Horton testified the arena was not part of the original contract. Morton likewise testified the $370,690 bid did not include the arena. Dr. von Buedingen claimed, however, the arena was always included in the plans, and gave directions to complete it.
Although the landscaping bid had been $16,000, the final bill amounted to $30,513.70. The landscaping sub-contractor, Mark Solly, testified he had to provide extra sod and perform extra work not anticipated in the bid, including drain field grading for the dressage arena, drainage systems around the barn, and 500 feet of edging around the beds and house. Solly also testified Dr. von Buedingen requested changes in the cross-tie walls.
The framing contractor, Leonard Kelly, had bid $38,000, but his final bill was $54,700. Kelly provided, a list of 28 requested changes and additions, including the re-framing of the sunroom.
The tile contractor, Boyce Raulerson, had bid $17,017, and his final bill was $35,968.92. Raulerson attributed the difference to the von Buedingens' decision to change from marble to granite, and to extra work requested in the entranceway, gazebo, tack room, laundry room, and barn area. Raulerson also put tile in the sunroom, which was not initially contemplated, and had to re-do some tile work pursuant to plumbing changes.
Although costs were mounting from the numerous changes, T.W. Morton failed to properly inform the von Buedingens of the escalating costs of the project. On July 23, 1990, T.W. Morton sent the von Buedingens the third draw request indicating a contract sum of $412,000, with payments of $273,000, and a "balance to finish" of $139,390.53. Judy Morton of T.W. Morton claimed the $139,390.53 figure represented simply the difference between the contract price and payments received, and should not have been represented as the balance to finish. The error was not corrected until the sixth draw, at which point the cost of the project, as yet unfinished, had reached $527,015.90.
Despite these errors, however, there was nonetheless evidence that Dr. von Buedingen had knowledge of the cost overruns at an earlier point. Jeff Spears, vice-president with NCNB South Carolina, which financed the project, testified he first learned of potential problems with the project on July 23, 1990. Spears said he learned of these problems through discussions with Dr. von Buedingen and others regarding the cost overruns.
The parties and bank representatives met at the bank on November 22, 1990 to discuss the project and the unpaid sixth draw request of $111,252.89. Dr. von Buedingen agreed to put up additional collateral to release the sixth draw and pay in full upon completion of the job if T.W. Morton provided a list of items...
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