U.S. For Use of Belcon, Inc. v. Sherman Const. Co.

Decision Date19 September 1986
Docket Number85-1768,Nos. 85-1767,s. 85-1767
Citation800 F.2d 1321
PartiesU.S. For the Use of BELCON, INCORPORATED, Appellant, v. SHERMAN CONSTRUCTION COMPANY and Seaboard Surety Co., Appellees, v. Lester BELCHER, Jr., and Lester Belcher, III, Third-Party Defendants. U.S. For the Use of BELCON, INCORPORATED, Appellee, v. SHERMAN CONSTRUCTION COMPANY and Seaboard Surety Co., Appellants, v. Lester BELCHER, Jr., and Lester Belcher, III, Appellees.
CourtU.S. Court of Appeals — Fourth Circuit

William N. Rogers (Shaffer & Rogers, Rockville, Md., William N. Zifchak, Sasscer, Clagett, Channing & Bucher, Upper Marlboro, Md., on brief), for appellant/cross appellees.

Gerald I. Katz (Mark J. Stone, Katz, Flinn & Beagan, Vilnna, Va., on brief), for appellees/cross appellants.

Before HALL and WILKINSON, Circuit Judges, and BUTZNER, Senior circuit judge.

K.K. HALL, Circuit Judge.

Belcon, Incorporated ("Belcon") is a Maryland corporation acting as a subcontractor in a business relationship governed by the Miller Act, 40 U.S.C. Sec. 270a-270d. Belcon appeals from an order of the district court entering judgment following a bench trial in a breach of contract action brought against the prime contractor Sherman Construction Company ("Sherman") and its surety, Seaboard Surety Company ("Seaboard"). The court held in Belcon's favor with regard to a portion of its claims against Sherman while denying recovery on its remaining allegations. Sherman cross-appeals the denial of its counterclaim brought against Belcon. Because we conclude that the findings of fact accompanying the district court's decision fail to satisfy the demands of Fed.R.Civ.P. 52(a), we remand for additional proceedings.

I.

On August 5, 1982, Sherman entered into a contract with the United States Veterans Administration to develop a project known as Phase II, which consisted of 26,400 gravesites on 52 acres of the Quantico Marine Base at Quantico, Virginia. On August 10, 1984, Sherman, in conjunction with Seaboard, executed and delivered to the Veterans Administration a payment bond in the amount of $524,000.00 for the protection of all persons supplying labor and materials in connection with the prime contract as required by the Miller Act.

On August 20, 1982, Sherman entered into a subcontract with Belcon. 1 Under the contract, Belcon agreed to furnish and install turf grass seed on the Phase II project in accordance with the specifications provided by the Veterans Administration in the prime contract. The contract, as subsequently amended, called for Belcon to receive $75,375.00 for its services.

In mid-September, 1982, Belcon arrived "on site" to commence work. At that time direct supervision of the field work was the responsibility of Lester Belcher, III, the son of Lester Belcher, Jr., the president of Belcon. Between September, 1982, and October, 1983, Belcon seeded the Phase II acreage on three separate occasions. The first seeding which occurred between September and December of 1982, and for which Belcon was paid, resulted in seed that either failed to germinate or failed to produce an acceptable stand of grass. The second seeding in May and June of 1983 achieved germination but still did not produce a sufficient growth of grass. The third seeding in October, 1983, performed after the execution of a contract change order, also failed to produce grass acceptable to the Veterans Administration.

Following the third seeding, Belcon, asserting that it had performed its full obligations under the contract, withdrew from the Phase II project. It subsequently tendered a demand for payment for the work done in connection with the second and third seedings. Belcon also requested payment for activities that it described as "extras" such as rock removal and the filling of washed out areas. Sherman denied that any additional sums were owed and maintained that Belcon had failed to satisfy the terms of the contract. Belcon then initiated a breach of contract action against Sherman in the district court seeking compensation from the payment bond issued by Seaboard.

The case came to trial on May 21, 1985. By agreement of the parties the jury was dismissed and the matter was tried to the court. In their respective presentations, the parties disputed both the nature of Belcons' obligations under the contract and the causes of any deficiencies in Belcon's performance.

Specifically, Belcon argued that its duty under the contract was simply to install the grass seed in a fashion that would achieve germination. Although the younger Belcher admitted that a substantial portion of the seed planted in the first seeding did not germinate, he attributed that failure to the fact that he was directed by Sherman to seed the areas out of season as a measure to control erosion. The elder Belcher also contended that the poor results achieved in the second seeding was caused by Sherman's poor site preparation and by the fact that Belcon was required to use an inappropriate seed mix. Belcon renewed its claim that it was entitled to payment for both the second and third seedings as well as the "extras." Belcon requested compensation in the amount of $147,554.00.

In response, Sherman argued that Belcon was understating the extent of its contractual duties. Sherman noted that the sub-contract incorporated by reference the Veterans Administration's specifications relating to landscaping at the Quantico National Cemetery. It was Sherman's position that the incorporated specifications imposed a duty upon Belcon to produce a stand of grass that would meet the approval of the Veterans Administration. Sherman contended that Belcon's failure, despite three attempts, and its subsequent withdrawal forced the employment of a replacement subcontractor at a cost to Sherman of $39,214.60.

Sherman also disputed the younger Belcher's contention that he was directed to perform the first seeding out of season. It argued that Belcon's inadequate performance was caused by the younger Belcher's inexperience and by the company's failure to provide proper care for the planted seed. Sherman further argued that it was not liable for any "extras" because the activities allegedly performed were either Belcon's duty under the contract in the first instance or constituted unauthorized changes in the contract for which Sherman was not responsible.

At the conclusion of the case, the court announced its findings from the bench. With regard to the first seeding, the court concluded that Belcher had not been ordered to plant out of season and had done so as a result of inexperience. The court specifically stated that the first seeding failed to achieve germination "because young...

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