E. Williamson Roofing and Sheet Metal Co., Inc. v. Town of Parish

CourtNew York Supreme Court Appellate Division
Citation139 A.D.2d 97,530 N.Y.S.2d 720
Parties, 29 Wage & Hour Cas. (BNA) 106, 120 Lab.Cas. P 56,728 E. WILLIAMSON ROOFING AND SHEET METAL CO., INC., Respondent, v. TOWN OF PARISH, Appellant.
Decision Date07 July 1988

Page 720

530 N.Y.S.2d 720
139 A.D.2d 97, 29 Wage & Hour Cas. (BNA) 106,
120 Lab.Cas. P 56,728
TOWN OF PARISH, Appellant.
Supreme Court, Appellate Division,
Fourth Department.
July 7, 1988.

Page 722

Seiter & Genant by Thomas Reynolds, Mexico, for appellant.

Sumner & Auser by Wallace Auser, III, Fulton, for respondent.


BALIO, Justice.

Plaintiff Williamson commenced this action to recover damages for additional costs incurred in connection with work performed on a public contract to repair a roof on defendant's highway garage. The complaint asserted two causes of action: breach of contract and unjust enrichment. Following joinder of issue, both parties moved for summary judgment. Special Term granted summary judgment on the cause of action for breach of contract, but only for a portion of the damages claimed by plaintiff. 1 We conclude that Special Term erred by finding that defendant breached its contract with the plaintiff.


The essential facts are not in dispute. The Town of Parish advertised for bids to repair the roof of its highway garage. The specifications for the work accompanied the advertisement. Before advertising for bids, the Town did not determine the classifications of workers that would be employed on the project as mandated by Labor Law § 220(3-a)(a). As a result, the Commissioner of Labor was not called upon to perform her statutory duties to make appropriate classifications, prepare a schedule of prevailing wages, or forward that schedule to the Town prior to the advertisement, and the schedule of prevailing wages was not annexed to the specifications for the work (see, Labor Law § 220). Indeed, the specifications made no mention of prevailing wages.

Plaintiff, who had prior experience with public contracts and who had worked on contracts where prevailing wages were paid, submitted its bid and was awarded the contract. Plaintiff's President offered to draft the contract and, following consultation with the Town Attorney, prepared the contract which was executed by the parties. The agreement made no mention of wages, and the specifications were not incorporated as part of the contract. Plaintiff performed its duties under the contract and was paid the contract price. Thereafter, the Department of Labor cited the Town for a violation of subdivision 3-a of Labor Law § 220. The Department also determined that plaintiff had not paid the prevailing wage to its employees and directed that plaintiff pay specified employees the difference between the prevailing wage and the wages actually paid. Plaintiff did not seek judicial review of that determination and, instead, complied with the directive and commenced this action to recover the amount paid, plus overhead and profit.


Plaintiff claims that the Town breached its contract (1) by failing to apply for a wage schedule; (2) by failing to annex a wage schedule to the bid specifications or the contract; and (3) by failing to

Page 723

include a provision in the contract requiring payment of the prevailing wage. We hold that the failure to perform these statutory requirements does not give rise to liability for breach of contract or for the negligent performance of a contractual duty. 2

Plaintiff's claim is predicated solely upon the Town's failure to perform the specified statutory duties.

The failure to apply for a wage schedule or to annex the schedule to the bid specifications cannot be a basis for contract liability because those omissions occurred prior to formation of the contract. Where both parties completely ignore the statutory scheme prior to formation or execution of the contract, no liability can arise on a theory of contractual breach ( Brang Co. v. State Univ. Constr. Fund, 47 A.D.2d 178, 179, 365 N.Y.S.2d 914; 24 Opns.St.Comp., 1968, at 225-226).

No contractual liability exists for the failure to include the prevailing wage provision in the contract for another reason. Subdivision 3 of Labor Law § 220 does not compel the governmental entity to prepare the contract. Although that responsibility ordinarily is assumed by the political subdivision, plaintiff offered to, and did, prepare the subject contract after consultation with the Town Attorney. Since plaintiff assumed the responsibility of preparing the agreement based upon representations about its experience in dealing with municipalities, any contractual liability for the omission of a necessary provision should be imposed upon plaintiff, not the Town. Moreover, no liability may be imposed for negligent performance of a contractual duty because the alleged omissions occurred prior to execution of the agreement and not during performance of its terms.


Plaintiff is not entitled to recover upon the ground of unjust enrichment.

For purposes of this appeal, we assume that the Town has been enriched because it has received the benefit of labor and services at less than the prevailing wage. 3 Mere enrichment is not enough, however, to warrant liability in quasi contract (22 N.Y.Jur.2d, Contracts, § 450). The defendant's conduct must have been of such nature that in equity and good conscience, it ought not to be allowed to retain the benefit ( Bradkin v. Leverton, 26 N.Y.2d 192, 197, 309 N.Y.S.2d 192, 257 N.E.2d 643; see also, 22 N.Y.Jur.2d, supra, § 450). In the subject case, there is no claim, that at the time the contract was signed, the Town knew that plaintiff would perform the contract by paying less than the prevailing wage. Although the Town should be charged with knowledge of its duty to obtain a schedule of prevailing wages, plaintiff, an experienced public work contractor, likewise knew or should have known of the prevailing wage requirement and is chargeable with such knowledge ( Village of Medina v. Dingledine, 211 N.Y. 24, 28, 104 N.E. 1118; see also, Matter of Cam-Ful Indus. v. Roberts, 128 A.D.2d 1006, 1007, 513 N.Y.S.2d 539). Moreover, to allow recovery by plaintiff would circumvent a statute designed to serve the public good and impose a fiscal burden upon the Town and its taxpayers, who are intended beneficiaries of the statutory scheme ( Village of Medina v. Dingledine, supra 211 N.Y. at 29, 104 N.E. 1118; see also Associated Bldrs. & Contrs. v. City of Rochester, 67 N.Y.2d 854, 501 N.Y.S.2d 653, 492 N.E.2d 781; Fata v. Healy Co., 289 N.Y. 401, 46 N.E.2d 339; Matter of General Bldg.

Page 724

Contrs. of N.Y. State v. Board of Trustees, Vil. of Cayuga Hgts., 42 A.D.2d 660, 345 N.Y.S.2d 195). Assuming, arguendo, that the fully-performed written contract does not preclude quasi contractual relief based upon unjust enrichment ( see, Clark-Fitzpatrick, Inc. v. Long Is. R.R. Co., 70 N.Y.2d 382, 388-389, 521 N.Y.S.2d 653, 516 N.E.2d 190), the Town's retention of the benefits of the contract would not, under these circumstances, amount to an unjust enrichment.

The complaint seeks damages for breach of contract and unjust enrichment. Certain allegations could, however, be viewed as stating a tort claim for violation of a statutory duty. 4 Though not raised by the parties, we exercise our discretion to consider whether, separate from any liability on the theory of contract or unjust enrichment, plaintiff is entitled to recover damages upon the theory that defendant was negligent in failing to perform a duty imposed by a statute. 5

Labor Law § 220 governs the hours and wages of laborers, workers and mechanics employed on public works contracts. All contracts within the section's scope must contain provisions concerning the maximum hours of labor per week and requiring contractors or employers to pay prevailing wages and fringe benefit supplements to those workers. The local governmental entity in charge of the project is required to prepare the classifications of workers required for the project and to forward that classification to the Commissioner of Labor. The Commissioner then is to prepare the proper classification of workers and a schedule of prevailing wages and supplements for each class of worker. The schedule is to be forwarded to the local entity and must be annexed to the work specifications prior to advertising for bids. The employer may contest the Commissioner's determination as to prevailing wages and supplements (Labor Law § 220). The statute includes procedures for administrative enforcement of its provisions and empowers the Commissioner to determine whether an employer or contractor has violated the statute, to direct the employer or contractor to pay the difference between the actual wages paid and the prevailing wage and to provide the appropriate supplements and in addition, to impose a civil penalty and interest. Further, a criminal sanction may be imposed upon a contractor who willfully pays less than the prevailing wage or supplements set forth in the contract. Any aggrieved party may commence a CPLR article 78 proceeding to review the Commissioner's determination concerning compliance with the statute, and any worker may also commence an action against the contractor or employer to recover the difference between the wages actually paid and supplements actually provided and those wages and supplements required to be provided under the section (Labor Law § 220).

The express language of Labor Law § 220 imposes no liability upon a governmental entity for the statutory violations committed in this case and does not create any remedy in the nature of a plenary action for the benefit of contractors. We further conclude that the creation of any such remedy or liability may not be implied from the language, purpose or intent of the statute.

"A statute 'creates' no liability unless it discloses an intention express or implied that from disregard of a statutory command a liability for resultant damages

Page 725

shall arise 'which would not exist but for the statute' " ( Schmidt v. Merchants Despatch...

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