City of Columbia v. Paul N. Howard Co.

707 F.2d 338
CourtCourt of Appeals for the Eighth Circuit
DecidedMay 11, 1983
DocketNo. 82-1907
StatusPublished
Cited by17 cases

This text of 707 F.2d 338 (City of Columbia v. Paul N. Howard Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Columbia v. Paul N. Howard Co., 707 F.2d 338 (8th Cir. 1983).

Opinion

PER CURIAM.

Paul N. Howard Company (Howard) appeals the district court’s granting of the City of Columbia’s motion for summary judgment in this construction contract dispute. Because we feel this case is inappropriate for summary judgment, we reverse the judgment of the district court.

I.

In February and March, 1980 the City of Columbia advertised for bids for construction of a public sewer improvement. As a prospective bidder, Howard received a document entitled “Specifications and Documents, Columbia, Missouri, Sewerage Improvements.” The Appendix to this document contained test boring logs. These logs contained the results of test bores of the subsurface conducted on the City’s behalf. Howard claims that during construction it discovered that actual subsurface conditions differed substantially from that indicated by the test boring logs. It argues that it could prove that the test boring logs themselves were inaccurate as well as that they were not representative of actual subsurface conditions. Howard said it incurred an additional $137,000 in expenses as the result of the unanticipated conditions. Howard filed a claim with the City for this amount, saying it was entitled to payment for these expenses under the “differing site conditions” clause in the contract. The contract provides for reimbursement of costs resulting from “[sjubsurface or latent physical conditions at the site differing materially from those indicated in this contract

The City filed a petition for a declaratory judgment in state court, arguing that the test boring logs were not part of the contract and therefore Howard was not entitled to the additional compensation. The City relied on a disclaimer on the cover page of the test boring logs which read: “These reports are for reference only and are not a part of the contract documents.” Howard removed the action to federal court based on diversity. Howard filed a counterclaim against the City, the City moved for summary judgment, and the district court granted the City’s motion.

II.

The district court found for the City because the differing site conditions clause only applied to information indicated in the contract, and the disclaimer proved that the test boring logs were not a part of the contract. The court relied on Air Cooling & Energy, Inc. v. Midwestern Construction Co., 602 S.W.2d 926 (Mo.App.1980), which held that a subcontractor could not recover extra compensation even though test boring logs were inaccurate because the contract had a disclaimer as to the accuracy of the data. We find that the court below erred in relying solely on the disclaimer to conclude that the test boring logs could not be relied upon by the contractor.

There are at least two parts of the contract which indicate that the test boring logs were a part of the contract and could be relied upon by the contractor. First, Article IY of the contract states that “the Contract Documents which comprise the contract between Owner and Contractor, attached hereto and made a part hereof, consist of the documents listed in the Table of Contents .... ” The test boring logs are listed in the Table of Contents under the heading of “Appendix.” Second, one of the supplementary conditions of the contract, SC-20, states: “Test hole information represents subsurface characteristics to the extent indicated, and only for the point location of the test hole. Each Bidder shall make his own interpretation of the charac[340]*340ter and condition of the materials which will be encountered between test hole locations.” While this part of the contract supports the City’s argument it is not responsible for unanticipated conditions between the test holes, it supports Howard’s argument that it was entitled to rely on the logs at least as to the actual conditions at the location of the test holes.

The district court made no attempt to reconcile these parts of the contract which could be seen as inconsistent with the disclaimer. As a general proposition, whenever possible, the law favors reconciliation of clauses within a contract which appear contradictory. In re Marriage of Buchmiller, 566 S.W.2d 256, 259 (Mo.App.1978); see Restatement (Second) Contracts § 202(5) (1981). When we examine the contract, we feel the various parts of the contract can be read consistently with each other by interpreting the contract to mean that the contractor could rely on the test boring logs only for their own accuracy and not for the conditions between the test hole locations.

The test boring logs do not have to be strictly considered “a part of the contract documents” (which the Appendix states they are not) to be binding on the City to the extent of their own accuracy. We can accept the City’s argument that the Appendix is not an item listed in the Table of Contents (but is an addition to the Table of Contents) and therefore the Appendix is not a part of the contract. However, the differing site conditions clause need not be interpreted to limit reimbursements to situations where the logs themselves are necessarily a part of the contract. The clause entitles the contractor to reimbursement when there are “conditions at the site differing materially from those indicated in this contract.” (Emphasis added.) Even though the logs may not be included in the contract, they are “indicated” in the contract, in SC-20 “Test hole information represents subsurface characteristics to the extent indicated, and only for the point location of the test hole.” SC-20 indicates the conditions by reference to the logs and specifically indicates the accuracy of the logs. This reference to the test hole information appears to be a sufficient indication of physical conditions to make the differing site conditions provision applicable. SC-20, in very clear and uncontradicted language, only vouches for the accuracy of the test hole data and not for the conditions between the test holes.1

The Air Cooling case does not command a different result. In that case the contract specifically repudiated responsibility for the accuracy of the test hole results. The contract stated: “Neither the owner nor the engineer will be responsible for the completeness of [sic] accuracy of data so furnished.” 602 S.W.2d at 929. Here the disclaimer merely stated the logs were not a part of the contract.

Upon remand the district court will be free to take additional evidence on the interpretation of the contract, if it feels it needs to look beyond the four corners of the agreement to determine the meaning of the contract. See Weldon, Williams & Lick, Inc. v. L.B. Poultry Co., 537 S.W.2d 868, 871 (Mo.App.1976); E.O. Dorsch Electric Co. v. Plaza Construction Co., 413 S.W.2d 167, 172 (Mo.1967).

III.

Howard also argues on appeal that it has a cause of action against the City independent of the differing site conditions clause. Howard argues that even if it has no remedy under that clause, it has a cause of action based on its reliance on a misrepresentation by the City. Howard relies on Clark v. City of Humansville,

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Bluebook (online)
707 F.2d 338, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-columbia-v-paul-n-howard-co-ca8-1983.