Leo A. Daly Co. v. Omaha-Douglas Public Building Commission

324 N.W.2d 252, 212 Neb. 533, 1982 Neb. LEXIS 1243

• Court: Nebraska Supreme Court
• Decided: September 3, 1982
• Docket: 44069
• Status: Published

Opinions

Per Curiam.

Plaintiff, Leo A. Daly Company, appeals to this court from the judgment entered by the District Court for Douglas County, following trial to the court sitting without a jury, in favor of the defendant, Omaha-Douglas Public Building Commission, in an action brought by the plaintiff to recover for extra services and expenses performed by the plaintiff in connection with the construction of the Omaha-Douglas County Civic Center, or, to be more specific, for services and expenses of the plaintiff in the subsequent repair or rebuilding of a slurry wall along Farnam Street which had collapsed during the course of construction of the civic center. We affirm the judgment of the District Court.

By way of background, the record reveáis that on October 9, 1968, Daly and the Omaha-Douglas County Civic Center Corporation entered into an agreement in which the civic center employed Daly to serve as an architect for the construction of the Omaha-Douglas County Civic Center, which contract was subsequently assigned to the Omaha-Douglas Public Building Commission. This contract for architectural services shall hereinafter be referred to in this opinion as the 1968 contract. As previously stated, on January 19, 1974, almost 6 years after the execution of the 1968 contract, a slurry wall along Farnam Street and adjacent to the civic center collapsed during the course of the construction. Almost immediately thereafter, to wit, on January 30, 1974, the various parties who had performed work or supplied materials for the construction of the civic center entered into an agreement to cooperate for the purpose of minimizing any delay in the construction of the building and any losses that might ultimately result therefrom. This agreement was signed by the Omaha-Douglas Public Building Commission, County of Douglas, City of Omaha, Leo A. Daly Company, Metropolitan Utilities District, P & Z Co., Inc., and Hawkins Construction Company, and will hereafter be referred to in this opinion as the seven-party agreement, or as the 1974 agreement.

Subsequent to the execution of the seven-party agreement above referred to, the plaintiff performed corrective work on the collapsed slurry wall, and the action brought by plaintiff in the District Court was for the purpose of recovering its labor costs and outside consulting costs with reference to the replacement of that wall. Plaintiff’s action did not involve recovery on a quantum meruit theory, nor did it involve claims of unjust enrichment, those doctrines not having been pleaded.

It will be helpful at this point to examine the pleadings upon which the case was tried before the district judge. In its second amended petition, filed in the District Court for Douglas County on October 6, 1978, plaintiff alleges the execution of the October 9, 1968, agreement and its subsequent assignment to the defendant. The petition further alleges that on January 30, 1974, following the collapse of a portion of the foundation wall on January 19, 1974, the plaintiff, defendant, and others entered into the seven-party agreement, and a copy of that agreement is attached to the petition. Plaintiff specifically alleges as follows: “Plaintiff performed all of its duties under the contract of October 9, 1968 including extra services and disbursements incidental to unusual circumstances as provided in sections III (B) of Exhibit ‘A’ and as required by Exhibit eD\” (Emphasis supplied.) Exhibit D, referred to, is the seven-party agreement.

Plaintiff further alleges that the extra services were rendered and expenditures made at the request and with the approval of the defendant; that the defendant is the proper party to bring a suit to determine the liability for the collapse, but has not done so; and, further, that plaintiff submitted to defendant a statement for the extra work but that defendant has refused payment thereof.

It is to be noted that the plaintiff in its petition pleads both the 1968 contract and the 1974 agreement and alleges that the work was performed under both contracts, thereby admitting judicially in its pleading that the work was performed under the 1974 agreement as well as under the 1968 contract.

The 1968 contract between the Commission and the architect sets out the duties of the architect and divides such duties into basic services for which an agreed fee was to be 6 percent of the construction costs, to be paid monthly as certain levels of construction were reached. This case does not involve this type of charge. However, the 1968 contract also provides for the payment of extra services of the architect “if performed due to unusual circumstances,” and provides that the extra expense shall be paid for by the nonprofit corporation as a “Multiple of Direct Personnel Expenses,” including, generally, making planning surveys and special analyses; making measured drawings of existing construction; revising previously approved drawings or specifications to accomplish changes ordered by the nonprofit corporation; consultation concerning replacement of any work damaged by fire or other cause during construction, and furnishing professional services of the type set forth in the preceding paragraph of the original contract as may be required in connection with the replacement of such work; arranging for the work to proceed should the contractor default due to delinquency or insolvency; providing for contract administration and observation of construction; preparing “as-built” drawings, showing construction changes in the work, etc.; and the cost of all reproductions of drawings, and the cost of any special consultants, etc.

In its brief on appeal plaintiff contends that it is entitled to recover its expenses because of the provisions of the 1968 contract, which it claims is applicable. Defendant, however, claims that the work in reconstructing the slurry wall was performed under the provisions of the 1974 agreement and not under the 1968 contract, and that plaintiffs right to recover depends upon the terms and provisions of the seven-party agreement, a copy of which is attached to plaintiffs second amended petition and was also received in evidence during the trial. Because of the importance of this issue, we discuss this latter agreement in some detail.

The purpose of the seven-party agreement entered into by all the parties engaged in the construction of the civic center is well summarized in the opening paragraphs of that agreement, and we quote those paragraphs in full: “WHEREAS, the Omaha Douglas Public Building Commission, hereinafter called ‘Commission’, engaged Leo A. Daly Company, hereinafter called ‘Daly’, to design and supervise the construction of a building designated in the construction contract as The City of Omaha and Douglas County Administration Building, and now known as the Omaha Douglas Civic Center, to be located on the block bounded by 18th and 19th Streets and by Famam and Harney Streets, Omaha, Nebraska; and,

“WHEREAS, the City of Omaha, hereinafter called ‘City’, and Douglas County, hereinafter called ‘County’, each have representatives among the membership of said Commission; and,

“WHEREAS, the Commission awarded the general contract for the construction of said building to Hawkins Construction Company, hereinafter called ‘Hawkins’; and,

“WHEREAS, Hawkins entered into a subcontract with P & Z Co., Inc., for the construction of the slurry wall system surrounding the building; and

“WHEREAS, a casualty occurred on January 19, 1974 involving a partial collapse of the North slurry wall along Famam Street, a partial collapse of the pavement of Farnam Street, the breaking of two water mains owned and maintained by Metropolitan Utilities District, the breaking of a storm sewer and breaking away of the subgrade of Famam Street owned and maintained by the City of Omaha, and damages to material and equipment installed, stockpiled and located in the basement of the building and the excavation; and,

“WHEREAS, the cause or causes of said casualty is undetermined and is under investigation; and, “WHEREAS, the parties hereto, each denying liability for said casualty but each wishing, without admitting liability for any part of said casualty and without prejudice to their individual rights and positions with respect thereto, to cooperate for the purpose of minimizing any delay in the construction of said building and any losses that may ultimately result therefrom;

“NOW, THEREFORE, in consideration of the mutual promises and covenants herein contained, the parties hereto mutually agree as follows:

“1. Each party may, through such representatives, including experts, as it may wish, conduct its own separate investigation of the cause or causes of said casualty at the site of the occurrence; . . . .

“2. Daly, at its own expense pending final determination of liability for the casualty as settled and compromised among the parties or as finally determined by courts of competent jurisdiction, shall:

“(a) If necessary, in Daly’s opinion, design a support system for the West slurry wall along 19th Street;

“(b) Design a support system for Famam Street, including stabilization of the paving;

“(c) Design a replacement wall for the collapsed North section of the slurry wall system;

“(d) Investigate and designate any remedial work required; and,

“(e) Instruct Hawkins when to remove the debris and remanants [sic] and instruct Hawkins as to the sequence in which they are to be removed as provided hereinabove.” (Emphasis supplied.)

There is a similar provision in the agreement affecting the contractor Hawkins, and paragraph 3 of the seven-party agreement provides with reference thereto: “3. Hawkins, at its own expense pending final determination of liability for the casualty as settled and compromised among the parties or as finally determined by courts of competent jurisdiction, shall:

“(a) Perform the construction work directed by Daly; and

“(b) Remove and preserve the debris and remanants [sic] as directed by Daly as hereinabove stated; provided however, that if a party wishes to have any item or items removed and preserved, the removal and preservation of which requires unusual equipment or skill, the removal and preservation of said item or items shall be arranged for and be done at the expense of the requesting party.”

The agreement then provides with reference to the duties of the city that the city shall keep 19th Street closed to vehicular traffic between Harney and Farnam Streets until the last slab of concrete is poured, and shall also keep such parts of Famam Street closed to vehicular traffic between 18th and 20th Streets as public safety requires.

We particularly call attention to paragraph 5 of the 1974 agreement, and set it out verbatim, as we believe that it is of great value and assistance in determining the meaning and purpose of the seven-party agreement. That provision is as follows: “5. It is specifically understood and agreed that the above and foregoing agreement is entered into without prejudice to any right of any party hereto, each party denying liability for the aforedescribed casualty and each party preserving all of its legal rights against every other party hereto and against all other persons, associations, partnerships, corporations or entities whatsoever.” (Emphasis supplied.)

To this point we have discussed, in brief, the contents of plaintiff’s second amended petition and the two contracts involved in the action attached to and incorporated in said petition. The defendant herein filed an amended answer to plaintiff’s second amended petition on August 7, 1980, admitting certain of the allegations of the petition, specifically admitting that plaintiff and defendant, and others, entered into the seven-party agreement, denying certain other allegations contained in plaintiff’s petition, and specifically alleging: “FURTHER ANSWERING, Defendant affirmatively alleges that the Agreement, Exhibit ‘D’ mentioned hereinabove, precludes Plaintiff from recovering alleged fees from Defendant until final determination of liability for collapse of the foundation wall. Such liability is presently being litigated in the following pending actions : [then follow the titles and docket numbers of five specific cases].” Finally, in its concluding paragraph defendant alleges: “Defendant, for further answer to the Second Amended Petition of the Plaintiff heretofore filed herein, alleges and states that any work performed by the Plaintiff in connection with rebuilding of the slurry wall after its collapse on January 19, 1974 was done voluntarily by said Plaintiff for its own benefit, under the terms of Exhibit ‘D’ [the seven-party agreement] attached to Plaintiff’s Second Amended Petition, and without any request of any kind or nature by this Defendant.” The defendant then prays that plaintiff’s second amended petition be dismissed with prejudice and that it recover its costs expended in the action.

On October 31, 1980, the plaintiff filed its reply to the amended answer of the defendant, denying, among other things, that the liability of the plaintiff to the defendant is now being litigated in the cases set out in defendant’s answer, but alleging that the defendant has voluntarily withdrawn therefrom and that the pending cases cannot, as between plaintiff and defendant, determine liability. Plaintiff also alleges that the seven-party agreement does not relieve the defendant of all liability to the plaintiff, but only defers it, and further alleges that the defendant is estopped from reliance on the agreement on account of its failure to seek the determination referred to in the seven-party agreement. Finally, plaintiff alleges that defendant has permitted the right of action to determine “liability” to be barred by the statute of limitations, and also alleges that the seven-party agreement was unenforceable because of want of consideration.

The foregoing constitutes a resume of the contents of the pleadings of the parties and the two contracts in question introduced at the trial, following which, as previously stated, the District Court judge hearing the matter found for the defendant and against the plaintiff.

A review of the record in this case convinces us that the work performed by the plaintiff in connection with the reconstruction of the collapsed slurry wall was performed under the provisions of the seven-party agreement and not the 1968 contract. Lest it be argued that the two contracts constitute an integrated contract, we point out that Restatement (Second) of Contracts § 209 at 115 (1981) defines “integrated agreements” as follows: “(1) An integrated agreement is a writing or writings constituting a final expression of one or more terms of an agreement. “(2) Whether there is an integrated agreement is to be determined by the court as a question preliminary to determination of a question of interpretation or to application of the parol evidence rule.

“(3) Where the parties reduce an agreement to a writing which in view of its completeness and specificity reasonably appears to be a complete agreement, it is taken to be an integrated agreement unless it is established by other evidence that the writing did not constitute a final expression.”

We believe in the instant case that the second contract, the seven-party agreement, cannot in any sense be construed as part of the original architectural contract, for the reasons that the 1974 agreement was entered into almost 6 years following the 1968 contract and the two contracts were not between the same parties, although two of the parties were the same as in the 1968 contract. Black’s Law Dictionary 726 (5th ed. 1979) states in its definition of an “integrated contract”: “An agreement is integrated where the parties thereto adopt the writing or writings as the final and complete expression of the agreement and an ‘integration’ is the writing or writings so adopted.”

Clearly the two contracts involved in this case cannot be considered as an integrated contract, but we are convinced that the seven-party agreement was a separate and independent contract, not connected with the 1968 contract. Plaintiff admits in its petition that its work was “required” by the terms of the 1974 agreement. It is the general rule under Nebraska law that the proper construction of a written contract is a question of law to be determined by the courts. Dochendorf v. Orner, 206 Neb. 456, 293 N.W.2d 395 (1980). We interpret that agreement as providing, as set out in paragraph 2 thereof, that Daly (and also, in paragraph 3, Hawkins) shall perform the required repair work as set out in said sections “pending final determination of liability for the casualty as settled and compromised among the parties or as finally determined by courts of competent jurisdiction.”

It is clearly implied in said agreement that once the question of liability for the casualty is determined in the manner specified, the parties may thereafter proceed to recover their damages against the party so found liable. There is absolutely nothing in the record before this court indicating a final determination of liability for the casualty, either as settled or compromised or as finally determined by any court of competent jurisdiction. We need go no further in disposing of this appeal.

We have examined the other errors and issues argued by plaintiff and find that they are without merit.

In its judgment in this case the District Court held that the plaintiff was not entitled to recover under either the 1968 contract or the 1974 agreement, its reasoning being that under the 1968 contract, as the court interpreted it, payment for other work must be requested and agreed to by the defendant. The court found that there was no evidence whatsoever that the defendant agreed to pay plaintiff for the additional work. The court also found, with reference to the seven-party agreement, that the defendant “did not make any agreement to pay for anything or, indeed, to do anything.”

As is apparent from what we have stated earlier in this opinion, we rest our decision on other grounds. However, it has long been the rule in this jurisdiction that a proper judgment will not be reversed even if the trial court did not give the right reason for its rendition. Strauss v. Square D Co., 201 Neb. 571, 270 N.W.2d 917 (1978); Riederer v. Siciunas, 193 Neb. 580, 228 N.W.2d 283 (1975). We conclude that the District Court reached the right result in this case and that its judgment should be, and hereby is, affirmed. i

Affirmed.