L & A Contracting Co. v. Oxley

261 F. Supp. 469, 1966 U.S. Dist. LEXIS 7567
CourtDistrict Court, N.D. Oklahoma
DecidedDecember 16, 1966
DocketCiv. No. 6238
StatusPublished

This text of 261 F. Supp. 469 (L & A Contracting Co. v. Oxley) is published on Counsel Stack Legal Research, covering District Court, N.D. Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
L & A Contracting Co. v. Oxley, 261 F. Supp. 469, 1966 U.S. Dist. LEXIS 7567 (N.D. Okla. 1966).

Opinion

MEMORANDUM OPINION

DAUGHERTY, District Judge.

In this diversity case, the plaintiff L and A Contracting Company (L and A) sues the defendant John T. Oxley (Oxley) for the sum of $40,107.28, with interest which is alleged to be the balance due and owing by Oxley to L and A as the result of a contract between them under which L and A furnished all the materials, labor and equipment to develop 420 acres of land in Martin County, Florida for a citrus grove. The defendant alleges that the plaintiff failed to perform the contract as required by its terms and the pertinent plans and specifications thereto by reason of which the plaintiff is not entitled to recover herein, and by counterclaim, the defendant asserts that it will be necessary for him to expend $30,000.00 to accomplish the work which the plaintiff failed to properly perform under the contract and that by reason of such failure on the part of the plaintiff, the defendant has sustained additional damages in the sum of $350,000.00 by reason of delay sustained by him in the planting of said land with citrus trees. By this counterclaim, the defendant seeks damages against the plaintiff in the total sum of $380,000.00.

The threshold question for the Court is a determination as to whether or not the contract involved is a lump sum contract in the amount of $68,091.76 or is a unit rate contract providing for the plaintiff to be compensated for work performed on the basis of prescribed unit rates for units of work accomplished. The plaintiff claims that the contract is a unit rate contract, that such was the intent of the parties and that based on the prescribed unit rates and work accomplished, the defendant became indebted to plaintiff in the sum of $85,168.80 as shown by the final progress report submitted on the project by the project [471]*471engineer. The defendant claims that the contract is a lump sum contract obligating him to pay only the stated sum of $68,091.76 plus an additional charge for clearing any stumps encountered and that this is the total amount that he would owe for the work necessary to accomplish the project in connection with the contract between the parties and the plans and specifications pertinent thereto. The defendant employed the engineering firm of Harris, Wood and Associates of Florida to prepare the plans and specifications and to supervise the work as project engineer. Mr. Harris of the engineering firm handled the matter for the defendant including the preparation of the plans and specifications but after the contract was entered into between the parties hereto and work was underway, the engineering firm dissolved. Mr. Harris became engaged elsewhere and Mr. Wood operated the engineering firm and supervised this project. It was the testimony of Mr. Harris, who appeared as a witness for the defendant, that the contract between the parties (the model form of which he supplied and which was sent out with the invitations to bid) was intended to be and was a unit rate or price contract and that this was the customary manner of doing this type of work in this area in Florida. Neither the defendant nor Mr. Harris could testify to any specific conversations between themselves about whether or not the contract was intended to be a lump sum or a unit rate contract. As work progressed the engineering firm submitted several monthly progress reports which were based on unit rate or price computations. Several of these were paid by the defendant without objection. The testimony of the plaintiff was to the effect that the contract was on a unit rate basis and was so intended by the parties thereto. The defendant testified that it was a lump sum contract.

The Court finds and concludes from an examination of the contract that the same is ambiguous and resort therefor may properly be made to parol evidence as to the intent of the parties in respect to whether the contract was lump sum or unit rate. 15 Oklahoma Statutes 162; Ramey v. Koons, (5th Cir.-1956) 230 F.2d 802; Rea Construction Co. v. B. B. McCormick & Sons, Inc., (5th Cir-1958) 255 F.2d 257; Caterpillar Tractor Co. v. Collins Machinery Co., (9th Cir.-1960) 286 F.2d 446. The Court further finds and concludes from the language and provisions of the contract, the testimony of the witnesses and conduct thereunder that it was the intent of the parties that the contract be performed and paid on the basis of the prescribed unit rates or prices. This issue is therefore resolved in favor of the plaintiff who has sustained his burden of proof on this point.

The next issue for consideration and determination is the effect of the provisions of the contract relating to the responsibilities of the project engineer selected and employed by the defendant. The contract provides: “The engineers will check work completed for compliance to the plans and specifications and adherence to soil conservation practices.” And, “The engineers, Harris, Wood and Associates will pass upon all work performed, the manner performed and whether diligently pursued.” The plaintiff claims that these provisions of the contract empower and authorize the project engineer to make final determinations which are binding on the parties to the contract, as to the manner of performance of the work involved and the amount of compensation due the plaintiff from the defendant for the work accomplished. The defendant denies that this language has this effect and denies that the project engineer may make final determinations in either area which are binding and conclusive on the parties, but contends that the Court must look to and determine the matter of performance under the contract. The project engineer under date of March 9, 1965, submitted a final report on the project and under date of July 6, 1965, issued a further letter in which the project engineer stated that the final report (March 9, 1965) con[472]*472stituted acceptance of the job by the engineers.

The Court finds and concludes that the language employed by the parties in the contract with relation to the responsibilities of the project engineer falls short of giving to the engineer the power and authority to make determinations, as either an arbitrator or as an engineer, regarding the plans and specifications, performance of work or the amount due under the contract which are to be final, binding and conclusive on the parties. Franklinville Realty Co. v. Arnold Constr. Co., (5th Cir-1941) 120 F.2d 144; (5 Cir.) 132 F.2d 828.

The Court determines therefore that the Court should examine the manner of performance under the contract and plans and specifications and while the evidence of the project engineer should be considered the same is not conclusive, final and binding on the parties or the Court.

Regarding performance under the contract and plans and specifications by the plaintiff, the evidence is in direct conflict. The defendant claims that the plaintiff failed to perform in compliance with the contract and the plans and specifications thereto. The evidence of the defendant narrows this complaint to the manner in which the plaintiff constructed the water furrow ditches and the adjacent planting beds.

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Bluebook (online)
261 F. Supp. 469, 1966 U.S. Dist. LEXIS 7567, Counsel Stack Legal Research, https://law.counselstack.com/opinion/l-a-contracting-co-v-oxley-oknd-1966.