Economy Forms Corp. v. WILLIAMS BROS. CONST. CO. INC.

754 S.W.2d 451, 1988 Tex. App. LEXIS 1591, 1988 WL 68822
CourtCourt of Appeals of Texas
DecidedJuly 7, 1988
DocketC14-87-00384-CV
StatusPublished
Cited by32 cases

This text of 754 S.W.2d 451 (Economy Forms Corp. v. WILLIAMS BROS. CONST. CO. INC.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Economy Forms Corp. v. WILLIAMS BROS. CONST. CO. INC., 754 S.W.2d 451, 1988 Tex. App. LEXIS 1591, 1988 WL 68822 (Tex. Ct. App. 1988).

Opinion

OPINION

SEARS, Justice.

This is an appeal from a summary judgment in favor of Appellee in a suit for damages for breach of a construction contract. We affirm.

This dispute arises out of the construction of the Houston Ship Channel Toll Bridge, a project of the Texas Turnpike Authority. There are a number of parties involved in the controversy and the complex factual situation requires an explanation of the relationships between these parties and the various litigation arising from their disagreements. Under the Texas Turnpike Authority’s Contract No. HSC-19, Williams Brothers Construction Company, Inc. (“Williams Brothers”) was the general contractor on the main span of the bridge over the Houston Ship Channel. The main span was built in two phases. The first phase was the contruction of the substructure, the four vertical concrete piers that would support the span. The second phase was the construction of the superstructure, the portion carrying the roadway across the ship channel. The piers were constructed out of concrete reinforced by steel bars. The concrete superstructure was reinforced with cables placed under extreme tension, requiring specialized “traveler” forms and personnel skilled in erecting and moving them.

Williams Brothers hired two subcontractors to complete this construction work. The Prescon Corporation (“Prescon”) was to provide the specialized forms and crews for reinforcing the superstructure. Falcon Construction Company (“Falcon”), under Williams Brothers’ subcontract No. 190-2 (“the subcontract”), was to prepare the site, construct the substructure piers and place and finish the superstructure concrete. Williams Brothers supplied the construction materials and much of the equipment used by these two subcontractors. Falcon was designated in its subcontract as Williams Brothers’ representative for coordination of the work on the project because Falcon personnel would be present on the site throughout the construction on the project. The Falcon subcontract included a customary “retainage” agreement which allowed Williams Brothers to retain up to five percent of each progress payment to Falcon. This retainage was to be held until the work was completed and was subject to offsets for debts owed by Falcon to Williams Brothers. Williams Brothers retained $401,073.74 pursuant to this provision. The subcontract further provided that if Williams Brothers or its bond were subjected to claims from Falcon’s suppliers, the retainage could be withheld in an amount and for such time as necessary to protect Williams Brothers.

Falcon executed a lease agreement with Appellant, Economy Forms Corporation, (“Economy”), for the rental of forms to be used in constructing the subsurface piers. Falcon executed three subsequent lease agreements and a purchase order with Economy for additional forms. During the construction of the substructure, Falcon experienced a series of problems which caused it to fall behind schedule. Falcon attributed part of its delay to the quality of the Economy forms and refused to pay the full amount of the rental price charged by Economy. As a result, Economy notified Williams Brothers that Falcon had not paid all rentals due, attached their invoices to Falcon to these notice letters, and asserted a claim against the payment bond provided by Williams Brothers to protect such claimants. However, Appellant failed to comply with the notice requirements of the MacGregor Act, Tex.Rev.Civ.Stat.Ann. art. 5160 and has now apparently abandoned its claim against the bond.

Falcon subsequently sued Economy in federal court and sued Williams Brothers in state court. Falcon filed its suit against Economy on March 18, 1982, in the United *454 States District Court for the Southern District of Texas, Houston Division. There, Falcon sought a judicial determination that it owed no rent to Economy beyond what it had already paid, and it sought damages from Economy for breach of warranty and for filing a false claim with Williams Brothers to prevent the release of the contract retainage to Falcon. Economy counterclaimed for breach of the lease agreements. On October 15, 1985, the court denied the relief sought by Falcon and found Falcon in breach of the Economy contracts. Economy was awarded damages in the amount of $345,891.05, attorneys’ fees, interest and costs. The Fifth Circuit affirmed the finding that Falcon had breached its contracts with Economy, affirmed the award of damages for breach of contract, interest and costs, and remanded the award of attorneys’ fees for further consideration. Falcon Construction Co. v. Economy Forms Corp., 805 F.2d 1229 (5th Cir.1986). This portion of the lawsuit is still pending in the federal district court. Falcon did not file a bond to supercede execution of the judgment in favor of Economy; therefore, Economy obtained a writ of garnishment against Williams Brothers ordering Williams Brothers not to pay any debts to Falcon or deliver any effects to Falcon. This writ of garnishment is still in force.

Falcon filed its lawsuit against Williams Brothers in the 80th Judicial District Court of Harris County, Texas, alleging breach of contract, misrepresentation and sought the payment of the $401,073.74 retained under the subcontract. Williams Brothers counterclaimed and both parties requested an award of attorneys’ fees. Economy intervened in this suit on August 15, 1983, asserting an interest in the retainage based on its breach of contract claims asserted as a counterclaim against Falcon in the federal lawsuit. Economy also asserted direct claims against Williams Brothers. It asserted that it had notified Williams Brothers of the unpaid rentals, that it was a third party beneficiary to the indemnity provisions in Subcontract No. 190-2 between Williams Brothers and Falcon, that Tex.Rev.Civ.Stat. 5472e required the retain-age to be held in trust by Williams Brothers for Economy’s benefit, and that Williams Brothers would be unjustly enriched if Economy was not paid the funds retained by Williams Brothers under the subcontract. Economy also asserted that Falcon would be unjustly enriched.

After the federal court entered its judgment, Economy amended its plea in intervention to apprise the state court of the terms of the judgment and nonsuited its causes of action against Falcon. Economy moved that its action against Williams Brothers be tried separately, after the action between Falcon and Williams Brothers. The court granted this motion on March 11, 1986.

The lawsuit between Falcon and Williams Brothers resulted in a jury verdict awarding certain elements of damages to both parties. The trial court considered these damage findings and the amount of the contract retainage and determined that Williams Brothers owed Falcon $301,-595.56. The court ordered this amount paid into the registry of the court to be held there until a final order or judgment was entered on the writ of garnishment in the federal lawsuit.

In the separate action between Economy and Williams Brothers, Williams Brothers filed its first amended answer to Economy’s plea in intervention asserting defenses of limitations and inadequate notice of Economy’s MacGregor Act claims. Williams Brothers also moved for summary judgment on all of Economy’s claims.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Danny Langhorne v. Kay M. Miller
Court of Appeals of Texas, 2009
Dealers Electrical Supply Co. v. Scoggins Construction Co.
292 S.W.3d 650 (Texas Supreme Court, 2009)
Scoggins Construction Co. v. Dealers Electrical Supply Co.
292 S.W.3d 685 (Court of Appeals of Texas, 2008)
Speck v. FIRST EVANGE. LUTH. CHURCH OF HOUSTON
235 S.W.3d 811 (Court of Appeals of Texas, 2007)
American States Insurance v. United States
324 B.R. 600 (N.D. Texas, 2005)
Gibson v. Bostick Roofing and Sheet Metal Co.
148 S.W.3d 482 (Court of Appeals of Texas, 2004)
Hester v. Friedkin Companies, Inc.
132 S.W.3d 100 (Court of Appeals of Texas, 2004)
Top Rank, Inc. v. Gutierrez
236 F. Supp. 2d 637 (W.D. Texas, 2001)
Coastal Chem, Inc. v. Brown
35 S.W.3d 90 (Court of Appeals of Texas, 2001)
Esquivel v. Murray Guard, Inc.
992 S.W.2d 536 (Court of Appeals of Texas, 1999)
Melvin Green, Inc. v. Questor Drilling Corp.
946 S.W.2d 907 (Court of Appeals of Texas, 1997)
Perez v. Alcoa Fujikura, Ltd.
969 F. Supp. 991 (W.D. Texas, 1997)

Cite This Page — Counsel Stack

Bluebook (online)
754 S.W.2d 451, 1988 Tex. App. LEXIS 1591, 1988 WL 68822, Counsel Stack Legal Research, https://law.counselstack.com/opinion/economy-forms-corp-v-williams-bros-const-co-inc-texapp-1988.