STATE OF MAINE SUPERIOR COURT PENOBSCOT, ss CIVIL ACTION DOCKET NO. RE-Or~4 WRf1~ f'~ tJ - Ic;Y~1 ,)010 JEFFREY B. GRASS, d/b/a J.B. GRASS EXCAVATING
Plaintiff,
v. ORDER ON DEFENDANT PM CONSTRUCTION'S RICHMOND BANGOR MOTION IN LIMINE DEVELOPMENT, LLC, PM CONSTRUCTION CO., INC., EASTERN BANK and KATAHDIN TRUST COMPANY
Defendants.
Before the Court is Defendant PM Construction Co., Inc. ("PM")'s motion in
limine requesting that Article 9 ("Article 9") of the contract ("Contract") between PM
and Plaintiff Jeffrey B. Grass, d/b/a J.B. Grass Excavating ("Grass") be found
unambiguous, therefore excluding any parol evidence relating to Article 9. Additionally,
PM asks that the Court "rule that Article 9 did not require PM Construction and Grass to
agree upon and execute change orders as a condition precedent to Grass being obligated
to perfonn changes to the scope of work as originally set forth in the Contract." (Def.' s
M. Limine 1.). In response, Grass has filed in opposition to PM's motion, requesting
that the Court rule that the Contract was unambiguous but required written change orders
between Grass and PM before any additional work was to be performed. In the
alternative, Grass requests that the Court find that the relevant Contract provisions are
ambiguous. Finally, Grass asks that if PM's interpretation of the Contract is adopted,
Article 9 be found unconscionable, invalid and unenforceable. (PI.' s Opp. M. Limine 1.).
1 1. FACTUAL BACKGROUND
Grass and PM agree about little in the factual record. Points of disagreement
between the parties regarding the facts will be noted. In or about September 2007, PM
and Grass entered into the Contract with PM serving as the contractor and Grass a
subcontractor on a project building a Walgreen's Pharmacy in Bangor. The Contract,
which both parties acknowledge as accurate, is attached as Exhibit 1 to Defendant's
Motion in Limine. The parties also both acknowledge that Exhibit 2 to Defendant's
Motion in Limine, entitled "AlA Document A 101™ - 1997" ("Owner's Contract") is the
controlling agreement between PM and the site's owner The Richmond Company, Inc.
("Richmond").
At some point during the project, a dispute arose between Grass and PM
regarding the scope of the excavation work Grass was obligated to perform under the
Contract. Grass contends that after beginning work on the project, it was discovered that
serious differences existed between the elevations identified in the site plans and
documents provided by PM and the actual elevations at the site. (PI.' s Opp. M. Limine
3.). Further, Grass alleges that PM instructed Grass to alter the proscribed method for
excavating trenches after Grass had began performing the work, creating a significant
increase in work. (PI.' s Opp. M. Limine 4.). Finally, Grass claims that the initial plans
and specifications indicated that the soils excavated on site would be used for fill and
backfill, but after commencing work PM directed him to remove the excavated soil and
obtain backfill from off site, which caused Grass added work and expenses. ld.
2 PM, while not addressing specific incidents, generally denies that Grass was
instructed to complete any work outside the scope of their agreement, but accepts the
contention solely for the purposes of this motion. (Def.' sM. Limine 2.).
At the time the dispute arose, Grass refused to continue work on the project until
Grass and PM agreed on written change orders delineating the scope of the new work as
well as Grass's compensation for performing. (Pl.'s Opp. M. Limine 4-5.). Grass claims
that PM's project manager issued assurances that change orders would be executed, but
that instead of providing change orders, PM hired another excavation company to
perform the additional work and the remaining work under the Contract. (Pl.' s Opp. M.
Limine 5.). PM disagrees that change orders were necessary, and alleges that Grass left
the project. (Def.' s M. Limine 1-2.).
At issue is the interpretation of Article 9 of the Contract, reprinted here in full:
Contractor may unilaterally make changes in the work covered by this Subcontract. Upon receipt of Contractor's written authorization to proceed with changed work, Subcontractor shall perform the changed work without delay. Extra compensation for such changed work will only be allowed when the amount has been agreed to prior to the execution of the changed work or when Contractor has been paid extra compensation by the Owner for said changed work. No compensation for changes or any other claims whatsoever shall be allowed unless Contractor is entitled to payment for Owner and the claim is submitted to Contractor in a timely fashion allowing Contractor to process the claim under the terms of the Contract Documents. The failure to so submit claims in a timely manner shall be deemed a waiver of the claim by the Subcontractor. All changes must be authorized by Contractor's form before payment will be made. (Def. Exh. 1,2).
ll. APPLICABLE LAW
3 "The issue of whether contract language is ambiguous is a question of law for the
court." Portland Valve, Inc. v. Rockwood Systems Corp., 460 A.2d 1383, 1387 (Me.
1983). See also Beal v. Allstate Insurance Company, 2010 ME 20, ~ 26,989 A.2d 733,
741. If the contract language is unambiguous, its interpretation is also a question oflaw
for the Court. Portland Valve, 460 A.2d at 1387. "A contract provision is considered
ambiguous if it is reasonably possible to give that provision at least two different
meanings." Villas by the Sea Owners Ass 'n v. Garrity, 2000 ME 48, ~ 9, 748 A.2d 457,
461. "The parol evidence rule operates to exclude from judicial consideration extrinsic
evidence offered to alter, augment or contradict the unambiguous language of an
integrated written agreement." Handy Boat Servo v. Proffessional Servs., 1998 ME 134, ~
11, 711 A.2d 1306, 1308-09.
III DISCUSSION
a. Ambiguity and the Parol Evidence Rule
PM argues that Article 9 is an unambiguous statement that PM could unilaterally
make changes to Grass's scheduled work, which Grass was obligated to perform upon
receipt of written authorization. Regarding payment, PM points out that there are two
possible methods for payment in Article 9: upon an agreement for extra compensation in
advance of the work being done, or if the Owner compensated PM for the extra work.
PM classifies the payment provisions as a condition precedent to Grass obtaining extra
payment and not a pre-condition to the obligation to perform extra work.
Grass counters by arguing that Article 9 is ambiguous because "[i]t makes no
sense that within the same paragraph, one can first force someone to do work without
receiving compensation and then state that no extra compensation will be allowed for the
4 work if it is not agreed to prior to execution ofthe work." (PI.' s Opp. M. Limine 10.)
(emphasis added). The plain language of Article 9 speaks against this argument.
Article 9 states that "[e]xtra compensation for such changed work will only be
allowed when the amount has been agreed to prior to the execution of the changed work
or when Contractor has been paid extra compensation by the Owner for said changed
work." (Def. Exh. 1,2).
Free access — add to your briefcase to read the full text and ask questions with AI
STATE OF MAINE SUPERIOR COURT PENOBSCOT, ss CIVIL ACTION DOCKET NO. RE-Or~4 WRf1~ f'~ tJ - Ic;Y~1 ,)010 JEFFREY B. GRASS, d/b/a J.B. GRASS EXCAVATING
Plaintiff,
v. ORDER ON DEFENDANT PM CONSTRUCTION'S RICHMOND BANGOR MOTION IN LIMINE DEVELOPMENT, LLC, PM CONSTRUCTION CO., INC., EASTERN BANK and KATAHDIN TRUST COMPANY
Defendants.
Before the Court is Defendant PM Construction Co., Inc. ("PM")'s motion in
limine requesting that Article 9 ("Article 9") of the contract ("Contract") between PM
and Plaintiff Jeffrey B. Grass, d/b/a J.B. Grass Excavating ("Grass") be found
unambiguous, therefore excluding any parol evidence relating to Article 9. Additionally,
PM asks that the Court "rule that Article 9 did not require PM Construction and Grass to
agree upon and execute change orders as a condition precedent to Grass being obligated
to perfonn changes to the scope of work as originally set forth in the Contract." (Def.' s
M. Limine 1.). In response, Grass has filed in opposition to PM's motion, requesting
that the Court rule that the Contract was unambiguous but required written change orders
between Grass and PM before any additional work was to be performed. In the
alternative, Grass requests that the Court find that the relevant Contract provisions are
ambiguous. Finally, Grass asks that if PM's interpretation of the Contract is adopted,
Article 9 be found unconscionable, invalid and unenforceable. (PI.' s Opp. M. Limine 1.).
1 1. FACTUAL BACKGROUND
Grass and PM agree about little in the factual record. Points of disagreement
between the parties regarding the facts will be noted. In or about September 2007, PM
and Grass entered into the Contract with PM serving as the contractor and Grass a
subcontractor on a project building a Walgreen's Pharmacy in Bangor. The Contract,
which both parties acknowledge as accurate, is attached as Exhibit 1 to Defendant's
Motion in Limine. The parties also both acknowledge that Exhibit 2 to Defendant's
Motion in Limine, entitled "AlA Document A 101™ - 1997" ("Owner's Contract") is the
controlling agreement between PM and the site's owner The Richmond Company, Inc.
("Richmond").
At some point during the project, a dispute arose between Grass and PM
regarding the scope of the excavation work Grass was obligated to perform under the
Contract. Grass contends that after beginning work on the project, it was discovered that
serious differences existed between the elevations identified in the site plans and
documents provided by PM and the actual elevations at the site. (PI.' s Opp. M. Limine
3.). Further, Grass alleges that PM instructed Grass to alter the proscribed method for
excavating trenches after Grass had began performing the work, creating a significant
increase in work. (PI.' s Opp. M. Limine 4.). Finally, Grass claims that the initial plans
and specifications indicated that the soils excavated on site would be used for fill and
backfill, but after commencing work PM directed him to remove the excavated soil and
obtain backfill from off site, which caused Grass added work and expenses. ld.
2 PM, while not addressing specific incidents, generally denies that Grass was
instructed to complete any work outside the scope of their agreement, but accepts the
contention solely for the purposes of this motion. (Def.' sM. Limine 2.).
At the time the dispute arose, Grass refused to continue work on the project until
Grass and PM agreed on written change orders delineating the scope of the new work as
well as Grass's compensation for performing. (Pl.'s Opp. M. Limine 4-5.). Grass claims
that PM's project manager issued assurances that change orders would be executed, but
that instead of providing change orders, PM hired another excavation company to
perform the additional work and the remaining work under the Contract. (Pl.' s Opp. M.
Limine 5.). PM disagrees that change orders were necessary, and alleges that Grass left
the project. (Def.' s M. Limine 1-2.).
At issue is the interpretation of Article 9 of the Contract, reprinted here in full:
Contractor may unilaterally make changes in the work covered by this Subcontract. Upon receipt of Contractor's written authorization to proceed with changed work, Subcontractor shall perform the changed work without delay. Extra compensation for such changed work will only be allowed when the amount has been agreed to prior to the execution of the changed work or when Contractor has been paid extra compensation by the Owner for said changed work. No compensation for changes or any other claims whatsoever shall be allowed unless Contractor is entitled to payment for Owner and the claim is submitted to Contractor in a timely fashion allowing Contractor to process the claim under the terms of the Contract Documents. The failure to so submit claims in a timely manner shall be deemed a waiver of the claim by the Subcontractor. All changes must be authorized by Contractor's form before payment will be made. (Def. Exh. 1,2).
ll. APPLICABLE LAW
3 "The issue of whether contract language is ambiguous is a question of law for the
court." Portland Valve, Inc. v. Rockwood Systems Corp., 460 A.2d 1383, 1387 (Me.
1983). See also Beal v. Allstate Insurance Company, 2010 ME 20, ~ 26,989 A.2d 733,
741. If the contract language is unambiguous, its interpretation is also a question oflaw
for the Court. Portland Valve, 460 A.2d at 1387. "A contract provision is considered
ambiguous if it is reasonably possible to give that provision at least two different
meanings." Villas by the Sea Owners Ass 'n v. Garrity, 2000 ME 48, ~ 9, 748 A.2d 457,
461. "The parol evidence rule operates to exclude from judicial consideration extrinsic
evidence offered to alter, augment or contradict the unambiguous language of an
integrated written agreement." Handy Boat Servo v. Proffessional Servs., 1998 ME 134, ~
11, 711 A.2d 1306, 1308-09.
III DISCUSSION
a. Ambiguity and the Parol Evidence Rule
PM argues that Article 9 is an unambiguous statement that PM could unilaterally
make changes to Grass's scheduled work, which Grass was obligated to perform upon
receipt of written authorization. Regarding payment, PM points out that there are two
possible methods for payment in Article 9: upon an agreement for extra compensation in
advance of the work being done, or if the Owner compensated PM for the extra work.
PM classifies the payment provisions as a condition precedent to Grass obtaining extra
payment and not a pre-condition to the obligation to perform extra work.
Grass counters by arguing that Article 9 is ambiguous because "[i]t makes no
sense that within the same paragraph, one can first force someone to do work without
receiving compensation and then state that no extra compensation will be allowed for the
4 work if it is not agreed to prior to execution ofthe work." (PI.' s Opp. M. Limine 10.)
(emphasis added). The plain language of Article 9 speaks against this argument.
Article 9 states that "[e]xtra compensation for such changed work will only be
allowed when the amount has been agreed to prior to the execution of the changed work
or when Contractor has been paid extra compensation by the Owner for said changed
work." (Def. Exh. 1,2). This statement, while serving the interests of PM, is not
ambiguous. It simply means that if there is not an agreement for payment prior to PM
providing Grass with a work authorization, PM will pay Grass upon receiving
compensation for the extra work from Richmond. There is no provision in Article 9
saying that a claim for compensation for extra work must be provided prior to the work
being completed, as Grass argues. The Contract provision simply requires the claim to be
made "in a timely fashion" (alternatively, it is also referred to as "in a timely manner").
(Def. Exh. 1, 2). Thus, a plain reading of Article 9 shows a single method for PM to
direct Grass to complete extra work and two non-conflicting, unambiguous pathways for
Grass to be compensated for performing.
Grass alternatively argues that Article 9 is ambiguous based upon conflicts with
other portions of the Contract. (PI.'s Opp. M. Limine 11.). Grass first points to
paragraph 2 of page 1 of the Contract, which states "Contractor agrees that it will pay to
Subcontractor in accordance with the provisions of Section 7, and subject to and [sic]
increases and decreases resulting from changes that may be agreed upon." (Def. Exh. 1,
1). Grass argues that this section states that there will be no increases or decreases in
compensation unless they are agreed upon.
5 This reading does not conflict with Article 9 to create any ambiguity. Not only
would an agreement upon changed compensation prior to completing the work be an
agreement upon changes, but so would an agreement based upon the alternative fonn of
payment specified in Article 9: a submitted claim to PM, which is in turn compensated by
Richmond, resulting in PM agreeing to compensate Grass. I
Article 9 must therefore be determined to be unambiguous, and because Article 9
is unambiguous, the parol evidence rule works to exclude extrinsic evidence offered
regarding the language of the Contract.
b. Interpretation of Unambiguous Language
Having determined the language of Article 9 to be unambiguous, the Court then
turns to interpreting Article 9. Grass argues that Article 4 of the Contract incorporates
the Owner's Contract's use ofthe phrase "NO CHANGES WITHOUT WRITTEN
CHANGE ORDER/ADDITIONAL WORK AUTHORIZATION IN ADVANCE OF
THE WORK" to require written change orders before proceeding. (Pl.'s Opp. M. Limine
6, quoting Owner's Contract §4.2, 7.6.). However, Article 4 ofthe Contract states:
Also incorporated herein by reference are the General Conditions of the Contract between the General Contractor and the Owner of said Project, and Subcontractor hereby agrees to be bound to Contractor by said General Conditions in the same manner and to the same extent as the General Contractor is bound to the owner, except as the same may be modified herein. (Def. Exh. 1,2).
I Grass also points to the merger clause of the Contract (Article 21), and the clause of the Contract incorporating the Owner's Contract as far as it is unmodified by the Contract (Article 4) as supporting his argument that the agreement is ambiguous. Neither clause affects the reading of Article 9 or the procedures it establishes.
6 A full reading of Article 4 thus shows that despite what may be contained in the Owner's
Contract regarding authorization for changed work, Article 9 of the Contract modifies
that provision.
The plain language of Article 9 states that in order to begin extra work, PM may
unilaterally provide Grass with written authorization to perform, which Grass shall
undertake without delay. There is no requirement for a mutually agreed upon change
order contained in the Contract, as Grass contends.
c. Unconscionability
Grass finally argues that, failing a finding of ambiguity or that a plain reading of
unambiguous language requires a written change order, Article 9 is unconscionable and
therefore unenforceable. Grass makes three arguments for procedural unconscionability:
(1) the take-it-or-leave-it nature of the offer; (2) the use of a broad range of contract
documents including fine print and convoluted language; and (3) PM's enhanced
bargaining power. Grass also claims substantive unconscionability because the terms of
Article 9 are "so one-sided as to shock the conscience." (Pl.'s Opp. M. Limine, 15, citing
Barrett v. McDonald Investments, Inc., 2005 ME 43, ~ 36, 870 A.2d 146, 156 (1.
Alexander concurring)(citations and quotation marks omitted).).
No evidence has been provided regarding the negotiation of the Contract, so it is
impossible to rule on the procedural unconscionability of the Contract. Regarding the
substantive unconscionability claims, Article 9 does not state that Grass will not be paid
if compensation is not decided upon prior to starting work. A process for submitting
claims for extra work already performed is provided, in which PM would compensate
Grass upon receipt of compensation from Richmond.
7 The entry is:
1. The Contract between Grass and PM was not ambiguous. 2. Parol Evidence will not be considered to construe the meaning of the Contract. 3. The Contract required only Grass's receipt of "written authorization" from PM to proceed with changed work. 4. Article 9 of the Contract was not unconscionable.
The Clerk may make this entry on the docket by reference.
Date: December 1,2010 William R. Anderson Justice, Superior Court
8 JEFFREY B GRASS DBA J B GRASS EXCA - PLAINTIFF SUPERIOR COURT 3000 BROADWAY PENOBSCOT, 55. GLENBURN ME 04401 Docket No BANSC-RE-200B-00014 Attorney for: JEFFREY B GRASS DBA J B GRASS EXCA DONALD F BROWN - RETAINED 10/27/2009 DON BROWN LAW OFFICE DOCKET RECORD 424 SOUTH MAIN ST PO BOX 3370 BREWER ME 04412
Attorney for: JEFFREY B GRASS DBA J B GRASS EXCA JOHN BUNKER - WITHDRAWN 11/03/2009 PAINE LYNCH & HARRIS PO BOX 1451 BANGOR ME 04402-1451
V5 EASTERN BANK - DEFENDANT C/O TERENCE A. MCGINNIS ONE EASTERN PLACE EP5-10 LYNN MA 01901 Attorney for: EASTERN BANK THEODORE SMALL - RETAINED 05/30/200B BERNSTEIN SHUR SAWYER & NELSON 100 MIDDLE ST PO BOX 9729 PORTLAND ME 04104-5029
Attorney for: EASTERN BANK MICHAEL BOSSE - RETAINED 05/30/200B BERNSTEIN SHUR SAWYER & NELSON 100 MIDDLE ST PO BOX 9729 PORTLAND ME 04104-5029
KATAHDIN TRUST COMPANY - DEFENDANT C/O MARY BONNIE LONDON POBOX 36 HOULTON ME 04730 Attorney for: KATAHDIN TRUST COMPANY THEODORE SMALL - RETAINED 05/30/200B BERNSTEIN SHUR SAWYER & NELSON 100 MIDDLE ST PO BOX 9729 PORTLAND ME 04104-5029
Attorney for: KATAHDIN TRUST COMPANY MICHAEL BOSSE - RETAINED 05/30/200B BERNSTEIN SHUR SAWYER & NELSON 100 MIDDLE ST PO BOX 9729 PORTLAND ME 04104-5029
Attorney for: KATAHDIN TRUST COMPANY DANIEL R NELSON - RETAINED SEVERSON HAND & NELSON PA 355 MARKET SQUARE Page 1 of 14 Printed on: 12/10/2010