L.A. Unified School Dist. v. Torres Construction Corp.

CourtCalifornia Court of Appeal
DecidedNovember 17, 2020
DocketB291940
StatusPublished

This text of L.A. Unified School Dist. v. Torres Construction Corp. (L.A. Unified School Dist. v. Torres Construction Corp.) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
L.A. Unified School Dist. v. Torres Construction Corp., (Cal. Ct. App. 2020).

Opinion

Filed 10/26/20 Certified for Publication 11/17/20 (order attached)

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION EIGHT

LOS ANGELES UNIFIED B291940 SCHOOL DISTRICT, (Los Angeles County Plaintiff and Respondent, Super. Ct. No. BC485280)

v.

TORRES CONSTRUCTION CORP. et al.,

Defendants and Appellants.

APPEAL from a judgment of the Superior Court of Los Angeles County, Robert L. Hess, Judge. Affirmed. SMTD Law, Jonathan J. Dunn, Andrew C. Harris; AlvaradoSmith, Raul F. Salinas and William M. Hensley for Defendants and Appellants. Orbach Huff Suarez & Henderson, David M. Huff, Colin E. Barr, Kelly Houle-Sandoval; Mark A. Miller for Plaintiff and Respondent. _________________________ SUMMARY Appellant Torres Construction (Torres) agreed to renovate school cafeterias for the Los Angeles Unified School District (LAUSD). Appellant Western Surety Company (Western) bonded Torres’s performance on the project. The project encompassed three phases. LAUSD ended up filing a civil complaint against appellants for breach of contract arising out of all three phases of the cafeteria renovations. This appeal is from a judgment entered after an encyclopedia of partial adjudications of the causes of action in LAUSD’s complaint against appellants. The parties brought motions for summary judgment, motions for judgment on the pleadings, motions for summary adjudication, and motions for directed verdicts; a few remaining claims survived these motions and were decided by jury verdict. Ultimately, LAUSD prevailed on its claims for breach of contract and was awarded $3,941,829 in damages. Western was found liable on its bonds. The parties settled Torres’s offset claims for withheld payments on other jobs in the amount of $556,296.89 plus $151,958.47 in interest. LAUSD was awarded prejudgment interest of $1,232,887.88 and costs in the amount of $88,716.97. LAUSD’s net recovery was $4,555,178.49. In addition, LAUSD was awarded $2.1 million in attorney fees against Western alone. This appeal is from the final judgment, but appellants do not directly challenge every court ruling. Torres focuses on 1) the denial of appellants’ motion for summary judgment; 2) the grant of LAUSD’s motion for summary adjudication on about half of the job orders it issued to Torres; and 3) the award of prejudgment interest. Torres contends its summary judgment motion should have been granted because LAUSD elected to sue on the overall

2 job order contracts, which were merely agreements to negotiate, rather than on the individual job orders for the school renovations, which were the final agreements. Torres also contends the trial court erred in granting LAUSD’s motion because 1) the trial court abused its discretion when it admitted evidence offered by LAUSD in reply to Torres’s opposition to summary judgment; 2) Torres’s offset affirmative defense rendered LAUSD’s damages uncertain; 3) LAUSD failed to obtain independent cost estimates, which were a statutory condition precedent to Torres’s performance; and 4) there were triable issues of material fact about waiver. Torres contends the trial court abused its discretion in awarding prejudgment interest because LAUSD’s damages were uncertain. Western joins Torres’s claims, and adds additional claims based on three of its affirmative defenses related to suretyship: 1) the statute of limitations on the bonds had run; 2) notice to the surety was deficient; and 3) LAUSD’s damages were not recoverable under the bond. Western contends LAUSD’s motion for summary adjudication should have been denied because LAUSD failed to negate these three affirmative defenses related to suretyship. Western also challenges the denial of its motions for directed verdict on these three affirmative defenses. Additionally, Western contends the trial court abused its discretion in awarding attorney fees in the absence of more detailed information about the work of each attorney. Some of appellants’ claims have been forfeited on this appeal due to appellants’ 1) failure to provide adequate, or, in some cases, any record citations; 2) failure to fully develop their arguments; and 3) failure to cite supporting relevant California

3 legal authority.1 As for the remaining claims, we find no error. The judgment is affirmed.

BACKGROUND Beginning in 2003, California statutorily authorized LAUSD to use an alternative procedure for bidding of public works projects. (Assem. Bill No. 14 (2003-2004 Reg. Sess.) § 1 (AB14).) This procedure, known as job order contracting, was defined in former Public Contracts Code sections 20919 through 20919.15.2 The Legislature stated that “[t]he benefits of a job order contract project delivery system include accelerated completion of the projects, cost savings, and reduction of construction contracting complexity.” (§ 20919, subd. (c).) The Legislature stated the procedure should be used to reduce project costs and expedite project completion. (Id., subd. (d).) Under this system, a job order contract (JOC) is competitively bid and awarded to the lowest responsible qualified bidder. (§ 20919, subd. (g).) A JOC is defined as a contract “in which the contractor agrees to a fixed period, fixed unit price, and

1 See United Grand Corp. v. Malibu Hillbillies, LLC (2019) 36 Cal.App.5th 142, 153 (United Grand Corp.). 2 All further statutory references are to that version of the Public Contract Code unless otherwise indicated.

The code was revised in 2012, after the events in this case had occurred. All citations to section 20919 et seq. are to the pre- 2012 version of the code, as shown in AB 14.

4 indefinite quantity contract that provides for the use of job orders for public works or maintenance projects.” (§ 20919.1, subd. (e).)3 For each JOC up for bid, LAUSD was required to provide potential bidders with a set of documents which include a construction task catalog and the JOC technical specifications, which in turn include General Conditions. (§§ 20919.4, subd. (a)(1); 20919.1, subds. (b) & (f).) The General Conditions set forth all the terms and conditions of the JOC, including pricing formulas, audit rights, insurance requirements, and payment obligations. The 2005 and 2007 General Conditions for the JOCs at issue in this appeal average about 90 pages. The bidders use the JOC documents to bid an adjustment factor that the bidder will charge for unit prices listed in the construction task catalog. LAUSD awards the JOC to the lowest responsible prequalified bidder. (§20919.4, subd. (b)(1).) The construction task catalog and General Conditions are incorporated into the JOC as contract documents. Once a JOC is awarded, LAUSD may order the contractor to perform work by issuing individual job orders under the JOC, using the procedures outlined in the General Conditions. LAUSD first notifies the contractor that work is necessary. The contractor is required by the JOC to participate in a “joint scope meeting” at the project site, as a result of which they develop a Detailed Scope of Work. LAUSD then issues a Request for Proposal (RFP) to the contractor, who is contractually required to prepare a Job Order Proposal (proposal) which sets forth the cost of performing the work. 3 “ ‘Indefinite quantity’ means one or more of the construction tasks listed in the catalog of construction tasks.” (§ 20919.1, subd. (c).)

5 By statute a proposal is defined as “the job order contractor prepared document quoting those construction tasks listed in the catalog of construction tasks that the job order contractor requires to complete the project scope of work, together with the appropriate quantities of each task.

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