A. Teichert & Son, Inc. v. State

CourtCalifornia Court of Appeals
Writing for the CourtFRIEDMAN; PIERCE, P. J., and REGAN
Citation48 Cal.Rptr. 225,238 Cal.App.2d 736
PartiesA. TEICHERT & SON, INC., a California corporation, Plaintiff and Appellant, v. The STATE of California, the State of California by and through the State Department of Public Works, Division of Highways, Defendants and Respondents. Civ. 11015.
Decision Date16 December 1965

Page 225

48 Cal.Rptr. 225
238 Cal.App.2d 736
A. TEICHERT & SON, INC., a California corporation, Plaintiff and Appellant,
v.
The STATE of California, the State of California by and through the State Department of Public Works, Division of Highways, Defendants and Respondents.
Civ. 11015.
District Court of Appeal, Third District, California.
Dec. 16, 1965.

Page 228

[238 Cal.App.2d 740] McDonough, Hollard, Swartz, Allen & Wahrhaftig and V. Barlow Goff, by V. Barlow Goff, Sacramento, for appellant.

Thomas C. Lynch, Atty. Gen., by Philip K. Jensen, Deputy Atty. Gen., Harry S. Fenton, Kingsley T. Hoegstedt, Orrin F. Finch, Ronald A. Zumbrun, by Orrin F. Finch and Ronald A. Zumbrun, Sacramento, for respondents.

FRIEDMAN, Justice.

Plaintiff A. Teichert & Son, Inc., a highway construction contractor, sues the state for damages and extra costs incurred in the course of a highway construction project. The complaint, in 16 separate counts, alleges submission of plaintiff's claim to the State Board of Control on November 14, 1963, and rejection by that body on December 17, 1963. The complaint was filed February 11, 1964. The state's demurrer was sustained without leave to amend and plaintiff appeals from the judgment.

The principal issues are: (a) whether the complaint shows compliance with the statutory period of limitations for filing claims with the State Board of Control and (b) whether the various counts state facts sufficient to constitute grounds of relief.

The lawsuit seeks recovery of six distinct money items on alternative legal theories. Assuming the truth of the complaint's factual assertions, we summarize its allegations:

A. The first claim, pleaded in five counts, is for $546,204.95, constituting additional construction costs caused by excessive soil moisture along the construction right of way. The construction contract was executed on February 24, 1959. Plaintiff had been furnished a materials report describing moisture conditions at certain points in the project area. [238 Cal.App.2d 741] On July 27, 1959, plaintiff notified the state of excessive moisture. Plaintiff proceeded with the work, but encountered excess costs and delay in installing drainage facilities and in meeting soil compaction requirements. The various theories of recovery are described in the first five counts as follows:

(1) The state's material report misrepresented soil conditions, inducing a lower bid than plaintiff would otherwise have made; as a result of 'said breach of warranty and misrepresentations' plaintiff has been damaged in the specified amount.

(2) Failure to compensate for changes in the character of the work and for extra work in accordance with express provisions of the construction contract.

(3) Failure to pay in accordance with an executed oral modification of the written contract.

(4) Excessive moisture conditions made performance of the contract impossible, discharging plaintiff from its obligations; nevertheless, plaintiff finished the work under modifications of the contract, which the state has refused to perform.

(5) Plaintiff relied to its detriment on oral promises to compensate for the extra work.

B. The second claim, pleaded in Count 6, stems from an interpretive dispute over the equipment rental provisions of the contract. Plaintiff claims that the equipment rental rates fixed by the contract entitle it to $34,606.82 more than the state allowed.

C. The third claim, pleaded in Count 7, seeks recovery of $19,591.70 for extra work authorized by a change order, premised upon plaintiff's interpretation of contract provisions establishing rates for extra work.

D. The fourth claim, pleaded in Counts 8 through 10, seeks $2,717.33 for cleaning debris from a conduit. The counts are based, respectively, on the theory of refusal to compensate under the contract provisions, executed oral modification of the written contract, and promissory estoppel

Page 229

E. The fifth claim, pleaded in Counts 11 through 13, seeks $1,598.62 for extra work of installing temporary drains, premised upon legal theories of refusal to compensate for extra work under the contract, executed oral modification of the contract, and promissory estoppel.

[238 Cal.App.2d 742] F. The sixth claim, pleaded in Counts 14 through 16, seeks reimbursement of $1,352.94 for the expense of hiring flagmen, an expense which was occasioned by an earth slide. Recovery is predicated on theories of extra work under the contract, executed oral modification of the contract and promissory estoppel.

As regards compliance with the period of limitations for filing claims with the State Board of Control, all counts of the complaint depend on these basic allegations in the first count:

'XIII On or about May 1, 1961, the revised final estimate of compensation for work performed was returned by plaintiff to defendants with the exceptions to the amount allowed as final payment noted thereon, and on or about April 11, 1963, defendants notified plaintiff of their refusal to fully compensate plaintiff for the work performed.

'XIV On or about November 14, 1963, a claim was filed with the Board of Control of the State of California as required by law, and thereafter, on or about December 17, 1963, the claim was denied by said Board.'

The reference to 'revised final estimate' prompts us at this point to take judicial notice of the Standard Specifications of the State Department of Public Works, Division of Highways (Aug. 1954), which we have power to do. (Code Civ.Proc., § 1875, subd. 3; Chas. L. Harney, Inc. v. State, 217 Cal.App.2d 77, 85-86, 31 Cal.Rptr. 524.) These were incorporated in the construction contract between plaintiff and the State, except as superseded by special provisions of the contract. We set out section 9(f) of the Standard Specifications in the margin. 1

Page 230

[238 Cal.App.2d 743] At the time of contract performance and for some time thereafter, Government Code section 644 (as enacted by Cal.Stats.1959, ch. 1715) was the governing statute of limitations. (Chas. L. Harney, Inc. v. State, supra, 217 Cal.App.2d 77, 90-91, 31 Cal.Rptr. 524.) Applicable to most claims against the state, it required claim presentation to the State Board of Control 'within two years after the claim first arose or accrued' and that a lawsuit be filed within six months after claim rejection.

In 1963 the Legislature adopted a comprehensive revision of state liability legislation. (Stats.1963, ch. 1715.) This legislation repealed section 644 and substituted present Government Code section 911.2. The latter, a permanent provision, requires that claims of the sort involved here be presented to the State Board of Control within one year after accrual of the cause of action. The 1963 legislation became effective on September 21, 1963. One of its features was a temporary provision, section 152 of chapter 1715, which was aimed at clarifying the time limits on claims which had accrued but had not yet been presented to the State Board of Control when the 1963 legislation became effective. In effect, as to claims which were not already barred by the former two-year limitation of section 644, it permitted presentation within one year after September 21, 1963. 2

[238 Cal.App.2d 744] In the trial court the state successfully contended that plaintiff's claims arose more than two years before September 21, 1963, the effective date of the 1963 legislation; being already barred by the two-year limitation of former section 644, Government Code, plaintiff's claims were not entitled to the one-year extension conferred by section 152; hence, were dead when plaintiff belatedly submitted its claim to the State Board of Control on November 14, 1963. Reduced to simple terms, the question is whether plaintiff's claims had arisen or accrued by September 21, 1961.

Teichert faced two periods of limitation: the two-year period for filing its claim with the State Board of Control and the six-month period following rejection within which to file suit. Generally, a cause of action accrues and the statute of limitations starts to run when the cause of action is complete and the party has a right to sue. (Maguire v. Hibernia Savings & Loan Soc., 23 Cal.2d 719, 733, 146 P.2d 673, 151 A.L.R. 1062; Merchants Fire Assur. Corp. v. Retail Credit Co., Inc., 206 Cal.App.2d 55, 58, 23 Cal.Rptr. 544; 1 Witkin, Cal.Procedure, p. 614.) Actually, the contractor had no right to sue until the State Board of Control had acted. (Chas. L. Harney, Inc. v. State, supra, 217 Cal.App.2d at p. 102, 31 Cal.Rptr. 524.) To determine when the first (two-year) period commenced, it is necessary to fix the time when Teichert would have had a right to sue had it not been for intervention of the Board of Control procedure.

Plaintiff contends that its right to sue for money claimed under the construction contract did not accrue until completion of the nonjudicial remedy established by the contract specifications, specifically section 9(f) of the Standard Specifications (fn. 1, supra). With this contention we

Page 231

agree. Either of two requirements of law supplies a footing for this view--exhaustion of administrative remedies or exhaustion of contract remedies. 3

The settlement procedure established by section 9(f) of the [238 Cal.App.2d 745] Standard Specifications should be viewed in the light of various provisions of the State Contract Act (Gov.Code, § 14250, et seq.) permitting the contracting authority to authorize changes in the work as the project progresses. 4 Another provision, section 14402, declares: 'Payments upon contracts shall be made as the department prescribes * * *.' When changes occur in the work specified in the original contract, unsettled debits and credits will usually exist upon project completion. Section 9(f) sets up a series of steps for the settlement of claims between the contractor and the state: First, after completion of the project the State Highway Engineer submits a...

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28 practice notes
  • Petersen v. City of Vallejo
    • United States
    • California Court of Appeals
    • March 4, 1968
    ...its filing." (39 Cal.App.2d at p. 34, 102 P.2d at p. 532. To the same effect see A. Teichert & Son, Inc. v. State of California (1965) 238 Cal.App.2d 736, 744, 48 Cal.Rptr. 225 (overruled on other grounds in E. H. Morrill Co. v. State of California (1967) 65 Cal.2d 787, 56 Cal.Rptr. 479, 42......
  • Stearns v. Los Angeles City School Dist.
    • United States
    • California Court of Appeals
    • September 8, 1966
    ...of whether they are entitled to any repayment. (Id., subd. (b); and see Patterson v. Missler, supra, 238 A.C.A. 877, 888--891, 48 Cal.Rptr. 225.) Failure to follow the verdict rendered against The jury returned the following finding on the loan interrogatory submitted to it: 'We, the jury e......
  • Crain v. Krehbiel, No. C-76-1018-CBR.
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Northern District of California
    • February 3, 1978
    ...not an "administrative proceeding forming a necessary prelude to a lawsuit" against the agents. See A. Teichert & Son, Inc. v. State, 238 Cal.App.2d 736, 48 Cal.Rptr. 225, 232 Plaintiff argues that he "is effectively barred from bringing an action against the government employees as individ......
  • Warner Constr. Corp. v. City of Los Angeles
    • United States
    • United States State Supreme Court (California)
    • March 31, 1970
    ...& McCue Constr. Co., supra, 66 Cal.2d 217, 224, 57 Cal.Rptr. 337, 424 P.2d 921; A. Teichert & Son, Inc. v. State of California (1965) 238 Cal.App.2d 736, 755, 48 Cal.Rptr. 225. The latter case was disapproved on other grounds in E. H. Morrill Co. v. State of California, supra, 65 Cal.2d at ......
  • Request a trial to view additional results
28 cases
  • Petersen v. City of Vallejo
    • United States
    • California Court of Appeals
    • March 4, 1968
    ...its filing." (39 Cal.App.2d at p. 34, 102 P.2d at p. 532. To the same effect see A. Teichert & Son, Inc. v. State of California (1965) 238 Cal.App.2d 736, 744, 48 Cal.Rptr. 225 (overruled on other grounds in E. H. Morrill Co. v. State of California (1967) 65 Cal.2d 787, 56 Cal.Rptr. 479, 42......
  • Stearns v. Los Angeles City School Dist.
    • United States
    • California Court of Appeals
    • September 8, 1966
    ...of whether they are entitled to any repayment. (Id., subd. (b); and see Patterson v. Missler, supra, 238 A.C.A. 877, 888--891, 48 Cal.Rptr. 225.) Failure to follow the verdict rendered against The jury returned the following finding on the loan interrogatory submitted to it: 'We, the jury e......
  • Crain v. Krehbiel, No. C-76-1018-CBR.
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Northern District of California
    • February 3, 1978
    ...not an "administrative proceeding forming a necessary prelude to a lawsuit" against the agents. See A. Teichert & Son, Inc. v. State, 238 Cal.App.2d 736, 48 Cal.Rptr. 225, 232 Plaintiff argues that he "is effectively barred from bringing an action against the government employees as individ......
  • Warner Constr. Corp. v. City of Los Angeles
    • United States
    • United States State Supreme Court (California)
    • March 31, 1970
    ...& McCue Constr. Co., supra, 66 Cal.2d 217, 224, 57 Cal.Rptr. 337, 424 P.2d 921; A. Teichert & Son, Inc. v. State of California (1965) 238 Cal.App.2d 736, 755, 48 Cal.Rptr. 225. The latter case was disapproved on other grounds in E. H. Morrill Co. v. State of California, supra, 65 Cal.2d at ......
  • Request a trial to view additional results

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