Town of Newington v. General Sanitation Service Co.
| Decision Date | 30 April 1985 |
| Citation | 196 Conn. 81,491 A.2d 363 |
| Court | Connecticut Supreme Court |
| Parties | TOWN OF NEWINGTON v. GENERAL SANITATION SERVICE COMPANY. TOWN OF NEWINGTON v. BALBOA INSURANCE COMPANY. |
James G. Geanuracos, Hartford, with whom, on the brief, was Judith P. Lederer, Hartford, for appellant-appellee (defendant Balboa Ins. Co.).
M. Donald Cardwell, Hartford, for appellant-appellee (defendant General Sanitation Service Co.).
Edward G. Pizzella, Newington, with whom was Sidney L. Rosenblatt, Newington, for appellee-appellant (plaintiff).
Before PETERS, C.J., and PARSKEY, SHEA, DANNEHY and SANTANIELLO, JJ.
In this action 1 for breach of contract the trial court found the issues for the plaintiff town against the defendant General Sanitation Service Company (General) and its surety on the bond given to secure performance of the contract, the defendant Balboa Insurance Company (Balboa). In their appeal from the judgment the defendants claim that the court erred (1) in concluding that a material breach of contract justifying termination had occurred; (2) in calculating damages for the cost of completing the remainder of the contract based upon employment of another sanitation company which was not the lowest bidder for the job; (3) in allowing a recovery against the surety, Balboa, without its participation in the bidding procedure as provided by the contract; and (4) in awarding damages for the entire period of the contract rather than for only the period remaining until expiration of the performance bond. The plaintiff has cross appealed from the refusal to include an allowance for prejudgment interest in the damages awarded. We find no error in either the appeal or the cross appeal.
It is not disputed that on November 9, 1976, the plaintiff town entered into a refuse disposal contract with the defendant General for a period of five years, January 1, 1977, to December 31, 1981. As required by the contract, General posted security for its performance in the form of a surety bond for the calendar year 1977, the first year of the contract. A similar performance bond with the defendant Balboa as surety was filed for the calendar year 1978.
On July 14, 1978, the town notified the defendants by letter of numerous instances of untimely and incomplete refuse collection and also declared its intention to terminate the agreement for default in the event that the deficiencies specified should persist. On August 31, 1978, the town in another letter detailed many additional contract violations that had occurred after the previous notification and declared the contract "in default and terminated effective September 30, 1978." This letter also asserted a claim for damages.
The trial court concluded that the defendant General had defaulted in its performance of the contract and awarded damages of $240,218.35 less certain adjustments against the defendant General. The judgment against the defendant Balboa was limited to $130,159, the amount of the bond.
In attacking the conclusion of the trial court that the evidence proved a "just and legitimate cause" for the town to terminate the contract, the defendants maintain that the memorandum of decision fails to set forth the subordinate facts found to support that conclusion. It is not claimed, however, that the evidence is insufficient to support the conclusion reached. Practice Book § 3060B requires that in nonjury trials "the court shall, either orally or in writing, state its decision on the issues in the case and, if there are factual issues, the factual basis of its decision." We have frequently indicated that if an appellant requires amplification or clarification of the factual basis of a decision to present his claims of error he should seek a further articulation from the trial court. John J. Brennan Construction Corporation, Inc. v. Shelton, 187 Conn. 695, 708, 448 A.2d 180 (1982); Kaplan v. Kaplan, 186 Conn. 387, 388 n. 1, 441 A.2d 629 (1982); Pandolphe's Auto Parts, Inc., v. Manchester, 181 Conn. 217, 222 n. 5, 435 A.2d 24 (1980).
Fairly construed, the memorandum of decision adequately sets forth the subordinate facts relied upon for the conclusion of default reached by the trial court. It refers specifically to the two letters sent to the defendants that detailed numerous instances of delays in collecting refuse in certain areas of the town until after 6 p.m., the deadline for such collection activities as specified in the contract. Although these letters were admitted for the limited purpose of showing the correspondence between the parties prior to the suit and not for the truth of the facts contained therein, the memorandum notes that the complaint "closely follows" the grounds for termination detailed in these letters and finds that the plaintiff "has proven by a preponderance of the evidence that it had just and legitimate cause to terminate the contract as it did." Several residents of the town testified to their observations of failure to pick up refuse as scheduled. The court rejected the defendants' claims of a political motivation for termination on the part of the town and of its violation of the contract by changing the location of the refuse disposal area. The memorandum expressly finds that delays in refuse collection "kept happening in various degrees each week" and that consequently "there was not that orderly, regular, stable, predictable or whatever refuse collection that was contemplated, expected and due under the contract." In the absence of a request for further articulation, this finding of subordinate facts sufficiently supports the court's conclusion of default.
The trial court based its award of damages upon the increase in the cost of refuse collection and disposal to be incurred by the town for the thirty-nine months of the contract remaining after its termination on September 30, 1978. After receiving bids solicited from six rubbish collection companies, the award was made to Trash-Away of New Britain, which had bid $24.68 annually per unit. A slightly lower bid of $24.15 per unit was submitted by Nutmeg Sanitation. The defendants claim that the court erred in allowing damages based upon the Trash-Away bid rather than the lower Nutmeg bid.
The contract provided that in the event of default "the contractor shall pay the town, as liquidated damages, the amount of any excess of the new contract price over the contract price herein provided for, both pro-rated to the period of time covered by the unexpired term of the contract at the time of default." The trial court followed this provision in its award of damages. We agree with the defendants that the contract should not be construed to excuse the plaintiff from a duty to use reasonable care to minimize its damages. Brown v. Middle Atlantic Transportation, Co., 131 Conn. 197, 199, 38 A.2d 677 (1944). The fact that a bid slightly higher than the lowest of the six received was accepted by the town and used as the basis for its calculation of damages, however, does not necessarily imply a breach of this duty. Other factors, such as the responsibility, experience, qualifications and reputation of the bidders also warranted consideration. Some explanation of why Trash-Away was selected instead of Nutmeg, the lowest bidder, is contained in a letter from the plaintiff dated September 11, 1978: "Although Trash-Away's quotation is not the lowest of those submitted, it is second lowest and the Town has confidence that Trash-Away is the firm most likely to reestablish an adequate service level at this critical time based on its performance in other communities and our observations of its facilities, equipment and operating procedures." The defendants refer to no evidence indicating that Nutmeg was equally as qualified to perform the work as Trash-Away. The defendants had the burden of proving that the town failed to use reasonable care to reduce its damages. Krawitz v. Ganzke, 114 Conn. 662, 665, 159 A. 897 (1932); Pollak v. Danbury Mfg. Co., 103 Conn. 553, 559, 131 A. 426 (1925). The trial court made no finding on this issue, nor have the defendants ever requested one by a motion for further articulation. Kaplan v. Kaplan, supra, 186 Conn. 388 n. 1, 441 A.2d 629. Under these circumstances, especially in view of the slight difference between the bids, we find no support for the defendants' claim that reasonable care was not exercised by the plaintiff to mitigate its damages.
The defendant Balboa claims that it has been relieved of its obligation by the admitted failure of the town to follow a provision of the bond stipulating that "[t]he cost of completion shall be fixed by taking bids from at least three responsible contractors chosen by obligee and surety." It is argued that this provision created a condition precedent to the liability of Balboa on the bond. We disagree.
The bond provided that, upon default of the principal, the "Surety will either (a) within fifteen (15) days of determination of such default take...
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