Graham Construction Co. v. Walker Process Equipment, Inc.

422 S.W.2d 478, 1967 Tex. App. LEXIS 2120
CourtCourt of Appeals of Texas
DecidedAugust 31, 1967
Docket278
StatusPublished
Cited by6 cases

This text of 422 S.W.2d 478 (Graham Construction Co. v. Walker Process Equipment, 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
Graham Construction Co. v. Walker Process Equipment, Inc., 422 S.W.2d 478, 1967 Tex. App. LEXIS 2120 (Tex. Ct. App. 1967).

Opinions

OPINION

NYE, Justice.

This is a suit for debt allegedly due on a written contract, brought by appellee Walker Process Equipment, Inc. against Graham Construction Company, the general contractor and National Surety Company. Graham was the prime contractor employed by the City of Gonzales to build a sewer disposal plant. Graham furnished the City a payment and performance bond with National Surety Corporation as surety. The case was tried before the court without a jury which ended in a judgment for ap-pellee Walker against Graham and Surety Company.

Prior to entering into the contract with the City, Graham solicited bids from various subcontractors for certain technical and specialized equipment. The proposal in question was from Robert H. Pyle which consisted of four parts, the last two parts of his proposal being alternate bids on the same item. Pyle, an engineer and salesman, acted as agent for Walker in submitting the first three items and as agent for Robert H. Pyle, Inc. on the fourth. Graham accepted the proposals being items 1, 2 and 4. Item 1 was the sewage treatment equipment ; item 2 the chlorine contract aeration equipment; and item 4 the blower equipment. A companion suit representing a judgment on item 4 involves much of the same facts, but is a separate suit. The opinion, handed down this day by this Court, in that suit is entitled Graham Construction Company et al. v. Robert H. Pyle, Inc., Tex.Civ.App., 422 S.W.2d 485.

The City of Gonzales awarded the contract to build the sewer treatment plant to Graham, whereupon Graham issued its purchase order to subcontractors Walker for items 1 and 2 and to Robert H. Pyle, Inc. on item 4. Although the contract between Graham and the City provided for a liquidated penalty of $50.00 per day for delay in completion of the plant, it was undisputed that such clause was not invoked by the City against Graham. Upon completion of the contract, the City paid Graham the full amount of its contract obligation ($244,462.30). Graham, on the other hand, did not pay either Walker or Pyle, Inc., any amount; whereupon notices were sent to Graham and the Surety Company and Walker and Pyle filed separate suits against Graham for the moneys due them under their contracts. Answering these suits, Graham contends that the equipment did not comply with the engineering specifications ; that Graham was required to alter, rework, modify and repair the equipment to his damage; and that because of the delay in the delivery of the equipment he was required at additional expense to maintain his personnel on the jobsite while awaiting delivery of such equipment. Plaintiff Walker in answer to defendant’s plea of an offset contended that Graham [480]*480waived any defects in the equipment, and waived any damages caused by any delay, by his acceptance of the equipment and by Graham’s failure to comply with the terms of the contract relative to modification and adjustment of the equipment without authority of the plaintiff. The trial court filed numerous findings of fact supporting its judgment against defendants. The defendants have perfected their appeal.

Appellant’s first point complains that the trial court erred in holding that substantial compliance of appellee’s contract obligations entitled appellee to recover the full contract price (2) that the trial court failed to make a requested finding on the damages to Graham by Walker’s failure to strictly perform and (7) that the trial court erred in placing the burden of proof on Graham to show its offsets.

A witness for the plaintiff testified without objection that it had made a proposal to Graham which had been accepted by Graham; that such contract was in writing in the form of a proposal, a written purchase order and a signed contract. All of these exhibits were admitted into evidence. Plaintiff’s witness further testified without objection that it had “fully performed its part of the agreement” * * and that “it furnished all of the equipment and materials and everything it was supposed to furnish to Mr. Graham under its contract”; that the amount due under the contract for items 1 and 2 were $62,-552.00 and $288.00 respectively and that Graham did not pay any portions of the indebtedness contracted and due under the contract to Walker; that Walker had made demand of Graham without any payment, necessitating the employment of an attorney to collect the debt.

Irrespective of such testimony it was shown in the record without dispute that there were some deviations from the exact contract terms which were remedied by appellant before the job was turned over to the City and accepted by them. The trial court found that appellee had substantially performed its obligation under the contract, both in respect to the material and equipment sold and delivered and to the deliveries being timely made.

The rule for determining compensation for damages in the case of substantial performance of a building contract rather than a full and complete performance is that the supplier is entitled to the full contract price less the reasonable cost of remedying the defects or omissions in such a way as to make the work perform to the contract terms. This deduction measures the damages allowed the contractor for the failure on the part of the supplier to fully comply with the specifications. Atkinson v. Jackson Bros., Tex.Com.App., 270 S.W. 848, 38 A.L.R. 1377 (Tex.Com.App.1925); Garland Grain Co. v. Bailey, 393 S.W.2d 945 (Tex.Civ.App.—Dallas 1965, writ ref’d n. r. e.); Treiber v. Schaefer, 416 S.W.2d 576 (Tex.Civ.App.—San Antonio 1967); Cooper Concrete Company v. Hendricks, 386 S.W.2d 221 (Tex.Civ.App.—Dallas 1965, no writ); Holt v. Purviance, 347 S.W.2d 321 (Tex.Civ.App.—Dallas 1961, writ ref’d n. r. e.); Hennemuth v. Weatherford’s Roofing Co., 278 S.W.2d 271 (Tex.Civ.App.—Waco 1955, writ ref’d n. r. e.); 10 Tex.Jur.2d, Building Contracts, §§ 21, 39 (1959). It is further generally true that the burden is on the supplier to furnish the evidence to properly measure the. deductions allowable to remedy the defects and omissions where there has been a substantial compliance of the contract. The trial court found that appellant suffered no damages because of any failure of Walker to fully comply with the contract. Even though there was no attempt on the part of the supplier Walker to prove the measure of damages necessary to remedy the defects and omissions such error is harmless and does not require a reversal of the judgment because of appellant’s waiver of the defects and omissions and because of the written contract which provided for a set procedure to be performed prior to making claim for defects or omissions under the contract. We discuss this later in the opinion.

[481]*481Appellant’s sixth point complains that the trial court erred in rendering judgment on the contract because the plaintiff failed to timely perform its contract obligations. There was considerable testimony concerning the completion of the equipment in time to be delivered to Graham so that there would be no delay on the project which might cause $50.00 a day liquidated damages to Graham on account of his contract with the City.

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Graham Construction Co. v. Robert H. Pyle, Inc.
422 S.W.2d 485 (Court of Appeals of Texas, 1967)
Graham Construction Co. v. Walker Process Equipment, Inc.
422 S.W.2d 478 (Court of Appeals of Texas, 1967)

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Bluebook (online)
422 S.W.2d 478, 1967 Tex. App. LEXIS 2120, Counsel Stack Legal Research, https://law.counselstack.com/opinion/graham-construction-co-v-walker-process-equipment-inc-texapp-1967.