Werner v. Ashcraft Bloomquist Inc.

• Decision Date: 25 January 2000
• Parties: (Mo.App. E.D. 2000) Richard C. Werner, d/b/a Neon City Sign and Electric Company, Plaintiff/Respondent, v. Ashcraft Bloomquist, Inc., Defendant/Appellant. Case Number: ED75617 Missouri Court of Appeals Eastern District Handdown Date: 0
• Court: Missouri Court of Appeals

10 S.W.3d 575 (Mo.App. E.D. 2000)

This slip opinion is subject to revision and may not reflect the final opinion adopted by the Court

Richard C. Werner, d/b/a Neon City Sign and Electric Company, Plaintiff/Respondent, v. Ashcraft Bloomquist, Inc., Defendant/Appellant.

Case Number: ED75617

Missouri Court of Appeals Eastern District

Handdown Date: 01/25/2000

Appeal From: Circuit Court of St. Louis County, Hon. Herbert Lasky

Counsel for Appellant: C. Christopher Lozano and Todd Hendrickson

Counsel for Respondent: Kristin Whittle

Opinion Summary: Ashcraft appeals the trial court judgment in Werner's favor in a breach of contract action.

AFFIRMED.

Division Four holds: Ashcraft's performance under its contract with Werner was not excused (1) by the doctrines of commercial frustration and impossibility of performance or (2) by the acts of a third party.

Opinion Author: William H. Crandall, Jr., Presiding Judge

Opinion Vote: AFFIRMED. Hoff, J., and Pudlowski, Sr.J., concur.

Opinion:

Defendant, Ashcraft Bloomquist, Inc. (hereinafter ABI), appeals from the judgment of the trial court, entered in a court-tried case, in favor of plaintiff, Richard C. Werner, d/b/a Neon City Sign and Electric Company (hereinafter Werner), in a breach of contract action. We affirm.

ABI entered into a contract with the owner of Fenton Plaza, Diversified Developers Realty Corp. (hereinafter Diversified), whereby it agreed to be the general contractor on a remodeling project for the shopping center. ABI entered into a subcontract with Werner to "remove and reinstall all store front signage with union labor" for a total price of $26,700.00. The contract was for labor only; no materials were included. Pursuant to the contract, Werner removed the signs and was paid $13,260.00 for that work.

Thereafter, Diversified determined that it wanted new signs and in accordance with its contract with ABI entered a change order to delete the reinstallation of the signs from its contract with ABI. ABI informed Werner that it was discontinuing its contract with him. Werner brought this action for, inter alia, breach of contract. The trial court found that ABI had breached the contract and awarded damages to Werner in the amount of $13,400.00.

Our standard of review in a court-tried case is enunciated in Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976).

In its first point on appeal, ABI challenges the trial court's finding that it breached its contract with Werner for the reason that the doctrines of impossibility of performance and/or commercial frustration excused its performance. ABI argues that because "Diversified exercised its right to enter a change order and removed all remaining signage work from ABI's contract," it "no longer had the right or ability to allow Werner to perform that work" under the contract at issue.

The doctrine of impossibility of performance excuses a party to a contract from performance when an Act of God, the law, or the other party renders performance impossible. Grannemann v. Columbia Ins. Group, 931 S.W.2d 502, 506 (Mo. App. W.D. 1996). If a party desires to be excused from performance in the event of contingencies arising after the formation of a contract, it is that party's duty to provide therefore in the contract. Stein v. Bruce, 366 S.W.2d 732, 734 (Mo. App. 1963).

The change order by Diversified is not the type of unexpected event warranting consideration of the application of the impossibility of performance doctrine. See, e.g., West Los Angeles Institute for Cancer Research v. Mayer, 366 F.2d 220 (9th Cir. 1966) (change in the law in the form of a revenue ruling); Lake Development Enterprises, Inc. v. Kojetinsky, 410 S.W.2d 361 (Mo. App. 1966) (Act of God in the form of freezing temperatures); Stein v. Bruce, 366 S.W.2d at 732 (death of a party). Furthermore, ABI made no provision for the termination of its obligation under its contract with Werner in the event Diversified entered a change order regarding the removal or reinstallation of the signs. See, e.g., Sanfillippo v. Oehler, 869 S.W.2d 159 (Mo. App. E.D. 1993) (because the non-competition agreement did not provide for termination of his obligation upon the death of the dentist from whom he purchased the assets of a dental practice, dentist-purchaser was not excused from paying under the non-compete agreement).

In addition, the ultimate question is whether or not the nature of the contract and the surrounding circumstances show that the risk of the subsequent events, whether or not foreseen, was assumed by the promisor. West Los Angeles Institute for Cancer Research, 366 F.2d at 225. In the case before us, it appears from the nature of ABI's contract with Werner and from the surrounding circumstances that ABI assumed the risk of a change order by Diversified after it contracted with Werner. As between ABI and Werner, ABI was in the better position to anticipate the frustrating event of a change order. ABI's failure to make provision for that contingency in its contract with Werner indicated its assumption of the risk that a change order might occur which could impair its contract with Werner.

ABI alternatively argues commercial frustration as a basis for discharging its performance under its contract with Werner. Under the doctrine of commercial frustration, if the happening of an event not foreseen by the parties and not caused by or under the control of either party has destroyed or nearly destroyed either the value of the performance or the object or purpose of the contract, then the parties are excused from further performance. Howard v. Nicholson, 556 S.W.2d 477, 482 (Mo. App. 1977). The...