Twin River Const. Co., Inc. v. Public Water Dist. No. 6, 44658

• Decision Date: 24 May 1983
• Docket Number: No. 44658,44658
• Citation: 653 S.W.2d 682
• Parties: TWIN RIVER CONSTRUCTION CO., INC., Plaintiff-Appellant, v. PUBLIC WATER DISTRICT NO. 6, Defendant-Respondent.
• Court: Missouri Court of Appeals

Page 682

653 S.W.2d 682

TWIN RIVER CONSTRUCTION CO., INC., Plaintiff-Appellant, v. PUBLIC WATER DISTRICT NO. 6, Defendant-Respondent.

No. 44658.

Missouri Court of Appeals,

Eastern District,

Division Four.

May 24, 1983.

Mogab & Hughes, Richard L. Hughes, St. Louis, for plaintiff-appellant.

Thurman, Nixon, Smith, Howald, Weber & Bowles, Louis Jerry Weber, Hillsboro, for defendant-respondent.

PUDLOWSKI, Presiding Judge.

Appellant Twin River Construction Company ("Twin River"), a water and sewer contractor, brought this action against respondent Public Water District No. 6 (the "Water District") to recover the balance allegedly due under a construction contract. Appellant sought judgment for a total of $71,701.34. Respondent acknowledged liability for only $12,905.03. The trial court disallowed most of appellant's claims and entered a judgment against respondent for $12,905.03. This appeal followed. We reverse and remand.

In early 1975, the Water District issued an invitation for bids to install extensions to its existing water main system. The work to be done was described in a set of detailed maps and drawings (the "plans") and in a booklet setting forth the technical data concerning materials to be used and construction techniques to be employed (the "specifications"). Procedural and legal aspects of the job were described in a statement of general conditions and special conditions (the "conditions"). The conditions stated that all of these documents were to be considered as the "contract documents". Bidders were instructed to carefully inspect all of these documents and the actual work sites before submitting bids.

According to the plans, extensions were to be installed in three different geographic areas (the "Hoene Springs" area, the "Four Ridge Road" area and the "Highway MM" area). The bid proposal, however, did not make reference to separate geographic areas. It treated the project as a whole and required the contractor to bid by "unit prices" by filling in a table, which we partially reproduce here: ¹

The bid proposal forms stated that the contractor's total compensation would be based upon the actual quantity of each item installed multiplied by the unit price for that item. It was expected that the contractor would take differing soil conditions and obstacles into account and base his bid upon an average cost of installation for each item or linear foot.

Twin River's bid on the project was accepted by the Water District. The contract was signed on February 25, 1975, and approved by the Farmer's Home Administration (FmHA) on April 8, 1975. Work was scheduled to begin on May 5, 1975. The contract called for completion of the project within 270 days.

Because the issues presented on this appeal are primarily concerned with interpretation of the contract documents, we here set forth in pertinent part some of the more important contractual provisions.

The "Definitions" section of the general conditions broadly defines the term "contract documents":

It is understood and agreed that the Notice to Bidders, Instructions to Bidders, Proposal, Contract Agreement, Performance-Payment Bond, General Conditions, Special Conditions, Specifications and Plans, Addenda thereto, and duly authorized Change Orders, together with any and all supplementary drawings furnished by the Consulting Engineers as and when required to make clear, and to define in greater detail, the intent of the contract plans and specifications, other drawings, specifications, and engineering data furnished by the Contractor (when and as approved by the Owner or Consulting Engineers), and instructions furnished by manufacturers of equipment for the installation thereof, are each and all included in this contract, and the work shall be done in full compliance and accord therewith.

The following paragraphs were included in a section entitled "Responsibility of the Contractor":

c. Quantities.... Payment to the Contractor will be made on the basis of the actual quantities constructed and it is understood that the proposal quantities may be increased or decreased as hereinafter provided without invalidating the unit bid prices; further that the Contractor hereby forfeits all rights of action to recover any anticipated profits occasioned by such increase or decrease in quantities.

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j. Variations, Changes and Modifications. The work contemplated in the contract documents may be subject to such changes as normally occur during construction. The Engineer, when acting within the authority entrusted to him, may order minor variations in the proportion and amount of work for which unit prices are quoted in the contract, provided such variations are consistent with the intent of the drawings and specifications and improve or expedite the work without materially affecting the total construction cost. The Owner reserves the right to make changes in the drawings and specifications and other changes in the contract quantities as may be considered necessary or desirable, provided such changes, alterations and modifications are effected legally and in accordance with the following procedures ....

k. Extra Work. No claim for extra work will be considered or allotted unless such extra work shall have previously been ordered by the engineer in writing in the form of a contract change order. The price paid for extra work shall be by the unit prices in the bidding schedule or by an agreed to lump sum for any work not covered by unit price bids.

l. Change Order Documents. Change order documents shall be used to effect changes which do not extend the physical boundaries of the originally contracted work provided the total value of all such changes does not increase or decrease the original total contract value by more than fifty per cent (50%).

Changes in the amount of work to be done shall be made on standard forms which will be furnished by the Owner or Engineer.

All change orders must be signed by all parties to the Contract and approved by the State Director for Missouri, Farmers Home Administration. Written approval must be received from the State Director for Missouri of the Farmers Home Administration, United States Department of Agriculture, prior to any contract, change order or assignment of any right benefits or moneys becoming effective and binding upon the parties.

Additional language concerning changes appeared in the section entitled "Payments to the Contractor":

c. Increased or Altered Work. The amount of compensation to be added to or deducted from the contract price shall be determined, established and fixed by written agreement prior to making any increases, alterations, or modifications. Under unit price contracts, or under lump sum contracts containing unit prices for the respective items of work, the Contractor shall perform the additional or altered items at the unit prices shown in the Contract and shall not be entitled to any claim for damages, loss of profits or increased cost by reason of such increased, altered, or modified work when within the prescribed limits.

Other paragraphs govern the granting of extensions of time and provide for liquidated damages in the event of unexcused delay:

e. Extensions of Time. Should the Contractor be delayed in the final completion of the work by any act or neglect of the Owner or Engineer, or of any employee of either, or by any other contractor employed by the Owner, or by strikes, fire, or other cause or causes outside of and beyond the control of the Contractor and which, in the opinion of the Engineer, could have been neither anticipated nor avoided, then an extension of time sufficient to compensate for the delay, as determined by the Engineer, shall be granted by the Owner, provided, however, that the Contractor shall give the Owner and the Engineer prompt notice in writing of the cause of delay in each case.

Extensions of time will not be granted for delays caused by unfavorable weather, unsuitable ground conditions, inadequate construction force, or the failure of the Contractor to place orders for equipment or materials a sufficient time in advance to insure delivery when needed.

f. Liquidated Damages and Time for Completion.... If the said Contractor shall neglect, fail or refuse to complete the work within the time herein specified, or any proper extension thereof granted by the Owner, then the Contractor does hereby agree, as a part consideration for the awarding of this Contract, to pay to the Owner the amount specified in the Special Condition, not as a penalty but as liquidated damages for such breach of contract as hereinafter set forth, for each and every calendar day that the Contractor shall be in default after the time stipulated in the contract for completing the work ....

(a) To unforeseeable cause beyond the control and without the fault or negligence of the Contractor, ....

Provided, Further, that the Contractor shall, within ten (10) days from the beginning of such delay, unless the Owner shall grant a further period of time to the date of final settlement of the contract, notify the Owner, in writing, of the causes of the delay, who shall ascertain the facts and extent of the delay and notify the Contractor within a reasonable time of its decision in the matter.

The amount of liquidated damages was elsewhere set at $50 per day. Language in the bid proposal documents also specified that:

The Owner shall have the right to deduct said liquidated damages from any moneys in its hands, otherwise due, or to become due to said Contractor, or to sue for and recover compensation for damages for non-performance of this contract at the time stipulated herein and provided for.

At some time after the contract had been signed, but before any work had begun, the Water District decided to extend the planned construction in the Highway MM area by adding 3030 lineal feet of 4"'' diameter pipe and a booster pump station in order to serve additional...