City of Whitehall v. Southern Mechanical Contracting, Inc.

599 S.W.2d 430, 269 Ark. 563, 1980 Ark. App. LEXIS 1249
CourtCourt of Appeals of Arkansas
DecidedMay 7, 1980
DocketCA 80-26
StatusPublished
Cited by5 cases

This text of 599 S.W.2d 430 (City of Whitehall v. Southern Mechanical Contracting, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Whitehall v. Southern Mechanical Contracting, Inc., 599 S.W.2d 430, 269 Ark. 563, 1980 Ark. App. LEXIS 1249 (Ark. Ct. App. 1980).

Opinion

Ernie E. Wright, Chief Judge.

This is an appeal by the City of Whitehall from a judgment in favor of appellees, Southern Mechanical Contracting, Inc., hereinafter referred to as SMC, and Highlands Insurance Company. SMC brought suit against the City for $32,812.51 unpaid balance of the contract price on a construction contract with the City and $35,000.00 damages. The City denied liability and counterclaimed for liquidated damages and expenses incurred in completing the contract work. The City also sought judgment against Highlands Insurance Company, the surety on the contractor’s bond. Trial before the court without a jury resulted in judgment for SMC against the City for $43,-734.24 and dismissal of the City’s action against both appellees.

In October, 1972, SMC entered into a contract with appellant for the construction of a sewer treatment pond and five sewage pump stations for the sum of $125,554.00. The contract required SMC to begin work on or before a date to be specified in a written notice to proceed to be issued by the City, and to complete the contract within 270 consecutive days. The contract contained a liquidated damage clause providing for $110.00 damages per day against the contractor for failure to timely complete the contract.

At the pre-construction conference attended by the parties and the project engineer, it was announced the City would have all land and rights of way acquired by the time notice to proceed was issued. On December 8, 1972, the City and engineer issued notice to SMC to begin work on or before January 4, 1973. On January 3, 1973, SMC was notified by letter from the engineer that all necessary preliminaries were not complete and the prior work order was recalled. On May 23, 1973, the City and engineer issued a new notice to SMC to begin work on or before June 4, 1973.

In January, 1973, SMC had written purchase orders for the equipment for the five pump stations, but the equipment was not the pump stations described in the contract specifications. The engineer declined to approve the equipment until he could be satisfied as to the warranty and suitability of the euqipment. SMC submitted data on the alternate equipment to the engineer on March 5, 1973. Shortly thereafter in March the manufacturer’s representative met with the engineer and supplied additional data. The alternate equipment was approved by the engineer on July 6, 1973. The pump station equipment was originally to be delivered by April 30, 1973, but the manufacturer changed delivery date to late Septmeber, 1973- SMC had planned to get the stations installed during the drier summer months.

Evidence on the part of SMC was that it could not start on the sewer treatment pond in the early summer of 1973 because the City had not acquired the land site for the pond. The court order by which the City acquired the site was obtained on July 27, 1973. While waiting for the notice to proceed with the job SMC undertook other work during the spring of 1973, and the other work was not concluded until sometime in August. SMC started work on the sewer contract August 8, 1973.

Because of delayed delivery of pump equipment and wet winter weather the contractor was unable to get the pump stations installed in the ground until well into 1974. In May of 1974, when the stations were being installed SMC was notified by the engineer that station 5 would be relocated. It developed the City did not own the site where the station was to be finally located, and after the site was acquired the engineer notified SMC by letter dated July 18, 1974, that access to the site was then available and he could proceed with installation. In the letter the engineer complained of the delays and called attention SMC had allowed the pump station equipment to be damaged because of improper storage, and the equipment would have to be checked out by the manufacturer.

There was evidence SMC was unable to obtain adequate fuel on the job in the fall of 1973 because of the oil embargo which occurred subsequent to the bidding of the job. When SMC started work the engineer had not surveyed or staked out the perimeter of the sewer treatment pond, and SMC provided a bulldozer and two men to clear a right of way to enable the engineer to survey and stake the site. Progress was made on constructing the pond during the remainder of 1973 until the work had to be suspended because of rain and winter weather, and work on the pond was resumed in July of 1974.

When the pump stations were installed three phase electric power necessary to operate the stations was not extended to the stations until October, 1974. The power company would extend service to the sites only on application by the City for permanent service. By the end of May, 1974, all pump stations were in place except number 5.

There was evidence pump station number 4 was out of level and SMC had to dig it out and reset it because an anchor had broken loose from a side of the station. The anchor had been installed as directed by the specifications, and thereafter the contractor used an additional anchoring procedure over and above the specification requirements.

The engineer by letter to SMC dated June 19, 197.4, complained of lack of effort to complete the job and that the job was already 111 days overtime and liquidated damages were accruing.

On July 11, 1974 SMC responded to the engineer’s letter and pointed out it had not been paid any on the contract since January, 1974, although it had installed four stations in the ground and number 5 would have been installed had the engineer not stopped the installation because of a delayed change in the site location. The City did not own the new site. July 18, 1974, the engineer notified SMC the site for station 5 was then available. It developed the site was in a wooded area near a bluff and required substantial extra work to install. The evidence was the additional cost to the contractor was $1,467.48.

From July through October, 1974, work progressed on the oxidation pond, and sometime during the latter part of that period the engineer required a change in the bottom of the pond to allow for only six inch variation instead of twelve inches as provided in the specifications. Additional work was done by SMC to meet this new requirement, and also a new requirement for a swell to be made to the outlet structure of the pond.

Absent availability of electric power to operate the dehumidifying equipment in the pump stations, all the equipment had to be thoroughly cleaned and repainted at a cost to SMC of $4,066.90.

Three of the pump stations were started on November 27, 1974, with the engineer and manufacturer’s representative present. Relays had to be ordered for the other two stations and they arrived on December 17, and were installed on December 19, 1974. All stations were activated and run under automatic controls on December 19 and 20 with the engineer and representative of the manufacturer present.

On December 12, 1974, SMC received a letter dated December 6, 1974, from the City Attorney expressing the intent to terminate the contract if satisfactory arrangements to complete the contract were not made. The letter stated, “In the event of such termination we will again serve notice upon your surety and you.”

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599 S.W.2d 430, 269 Ark. 563, 1980 Ark. App. LEXIS 1249, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-whitehall-v-southern-mechanical-contracting-inc-arkctapp-1980.