Madison Construction Co. v. State

11 Ill. Ct. Cl. 64, 1938 Ill. Ct. Cl. LEXIS 98

Opinions

Me. Justice Linscott

delivered the opinion of the court:

The complaint alleges that the State of Illinois, acting through its Department of Public Works and Buildings, duly gave notice to contractors and to this claimant that sealed proposals for the improvement of a State highway, known as State Bond Issue Route 150, Federal Aid Project Number 194, Section 1922, in Jackson-Randolph County, near Rock-wood, Illinois, by constructing a paved roadway eighteen (18) feet wide with eleven (11) feet of earth shoulders, would be received by the Department on September 7,1932, and as part of said notice to contractors stated that cement for said work would be furnished by the Department.

The claimant made a proposal which was accepted and the contract was awarded to the claimant, and the State and the claimant entered into a contract which was dated October 17, 1932. Under this contract the State was to furnish the cement necessary for the improvement and claimant was to furnish the labor and other materials.

Paragraph' 3 of the claim is as follows:

“The claimant, thereupon and pursuant thereto made a proposal to the said Department for the construction of said road improvement, and the said proposal was, by the said Department, accepted and the work and contract awarded to the claimant, and thereafter the State of Illinois entered into the contract with the claimant which is in words and figures as follows:

Contract.

“1. This agreement, made and concluded his 17th day of October, 1932, between the State of Illinois, acting by and through the Department of Public Works and Buildings, known as the party of the first part, and Madison Construction Company, his/their executors, administrators, successors or assigns, known as the party of the second part.

“2. Witnesseth: That for and in consideration of the payments and agreements mentioned in the Proposal hereto attached, to be made and performed by the party of the first part, and according to the terms expressed in the Bond referring to these presents, the party of the second part agrees with said party of the first part at his/their own proper cost and expense

to do all the work, furnish all materials and all labor necessary to complete the work in accordance with the plans and specifications hereinafter described, and in full compliance with all of the terms of this agreement and the requirements of the Engineer under it.

“3. And it is also understood and agreed that the Notice to Contractors, Special Provisions, Proposal, and Contract Bond, hereto attached, and the Plans for State Bond Issue Route No. 150 Federal Aid Project No. 194, Section 122, in Jackson-Randolph County, dated. August 17th, 1934, and the “Standard Specifications for Road and Bridge Construction,” adopted by said Department January 2, 1932, are all essential documents of this contract and are a part hereof.

“4. In witness whereof, The said parties have executed these presents on the date above mentioned.

The State of Illinois,

By the Department of Public Works and Buildings

By H. H. Cleaveland, Director.

Attest:

Frank T. Sheets,

Acting Superintendent of Highways. Party of the First Part

(If a corporation)

Corporate

Name Madison ' Construction Co.

By Orlie T. Dunlap, President.

Attest:

M. D. Powell, Secretary. Party of the Second Part.

(Corporate Seal Attached).”

The complaint- sets forth' several provisions from the Standard Specifications for Road and Bridge Construction adopted by the Department on January 2, 1932.

It is. averred that ¿fter entering into the contract, complainant immediately entered upon and commenced doing the work according to the contract and employed various persons as managers, superintendents, foremen, machine operators, watchmen, timekeepers and others in perfecting an organization to do the work efficiently and promptly, and placed its machinery and equipment necessary in service at the location of said work, and was prepared to promptly complete the work according to the contract without delay. Under the terms of the contract the work was to be completed July 1, 1933.

It is further averred that upon completion of all the preliminary work necessary to commence laying concrete, the claimant requested the Department to furnish the cement therefor in accordance with the contract, and on January 3, 1933, the Department authorized the claimant to obtain the cement therefor from the Marquette Cement Manufacturing Company of Chicago, Illinois, and afterward on April 5, 1933, the Department authorized the claimant to obtain the cement from the Alpha Portland Cement Company, and the claimant being ready for the use of the cement, instructed the Alpha Portland Cement Company to ship six cars of cement on April 25, 1933, and thereafter, five hundred barrels of cement per day until further notice, said cement to be used upon this improvement.

It is further alleged that notwithstanding the authorization to obtain cement, that on or about April 25, 1933, the State withdrew its consent for the shipment of the cement and instructed the cement company to make no shipments until further notice, and by reason of the refusal of the Department to comply with its contract and furnish the cement as required, the claimant was compelled to suspend operations indefinitely and wait for cement, and the work was suspended from April 27, 1933, to June 27, 1933, at which time the Department furnished the cement and the work was continued until completed.

It is also charged0 that during the time the work was suspended, which was two months, the claimant paid its manager, its superintendent and other employees, and its machinery and equipment was held ready for use on the job and could have been used in said work on nearly every day during the period of time it was waiting for cement, and it had other contract jobs in which it could have used its machinery and equipment, and because of the failure of the State to furnish cement, the claimant avers that it is entitled to the sum of Twenty-one Thousand Two Hundred Twenty-one Dollars and Sixty-six Cents ($21,221.66).

From the evidence it appears that claimant did everything he could reasonably do to obtain cement.

It is a well known fact that during this time the cement dealers had greatly increased the cost of cement without any apparent reason. On April 27, 1933, claimant wrote the Highway Department to the effect that it had been put to huge expenses on account of unavoidable conditions, and for it to assume additional heavy expenses to cooperate on a bad situation, which could be avoided, it could not fully agree to do, unless the Department agreed to reimburse it for all of its losses. The claimant stated in this letter that it had carefully studied all of the correspondence relative to the matter, and found only a “request” not to order cement had been made, and it positively stated that it had construed that to mean a “request” instead of positive instructions was given to avoid any liability, and claimant informed the State that if the State would assume the financial liability and expenses it would be glad to cooperate with the “request” and Governor Horner, but otherwise claimant was not willing to assume the expense of stopping the work and laying up the equipment. Claimant further called the State’s attention to the fact that there were no provisions in the contract which permitted the State to cancel the contract or suspend the work at its option whenever the arrangements for securing cement by the State were not as satisfactory as the State had expected, and stated in its letter that the condition confronted was not brought about by the failure of the State to secure the cement, but simply, as claimant understood it, the State desired more favorable price or terms, and claimant stated that it was not responsible for this, and emphasized the fact that the State should be responsible for the loss and not the contractor. This is the substance of Claimant’s Exhibit 10.

Claimant’s Exhibit 13 is a letter from the Governor to the claimant. In this he acknowledged receipt of a telegram and stated while he was in sympathy with the claimant’s situation, “you surely do not expect your State to submit to the efforts of a combination of cement manufacturers to impose an arbitrary and excessive price upon the State. Personally, I expect every good citizen to stand behind my efforts to prevent the State being mulcted.”

From the above we see the attitude of both claimant and the State. It is very apparent that the claimant was delayed from April 27th to June 27, 1933. The contract provided for the work to be completed by July 1, 1933. Claimant finished paving on Section No. 122 on July 29,1933, and clean up work and shouldering were completed October 14, 1933. It is not claimed that there was any increased cost in shouldering or cleaning caused by rise of price of labor or materials, or that claimant’s paving equipment was held on the job for this worki

The Attorney General argues that there were nineteen days on which weather conditions would have prevented operation, even if the cement was available, and there does not seem to be anything in the record to controvert this.

The State offered testimony that claimant’s method of arriving at its loss incurred by reason of idle equipment during the two months period included items which were not applicable to idle equipment for which claimant made charge. Claimant’s testimony with reference to its expense for the equipment during the two months period was based upon the average cost of ownership as compiled by the Associated General Contractors of America, Inc., rather than upon claimant’s actual experience in regard to the particular items of equipment involved.

The report of the Division of Highways disclosed that on January 20, 1934, the final estimate had been prepared by the engineer, and the claimant was paid the sum of $9,669.98, which was the last payment for this job; that the claimant accepted the warrant issued for this amount and cashed the same.

Several questions have been raised upon the record both by claimant and the State.

The State argues that under no circumstances would the claimant be entitled to compensation for the delay referred to for the period of time from July 1, 1933, to July 29, 1933, for the reason that claimant was to finish the job on July 1, 1933, and it eventually finished the paving job on July 29, 1933, and that nineteen days during the period in which the cement was not furnished were unsuitable for operation on account of weather conditions, and the State cites authorities to that effect.

The claimant argues that under its system of figuring damages, it was entitled to compensation, but under our view of the case it will not be necessary to decide which system was proper.

It is averred in claimant’s complaint, Paragraph 3, Section 3 thereof, that Standard Specifications for Road and Bridge Construction, adopted by the Department on January 2, 1932, is an essential part of the contract, and made a part thereof. The Standard Specifications provide that the acceptance by the contractor of the last payment shall operate as and shall be a release to the Department from all claims or liability under the contract for anything done or furnished or relating to the work under the contract, or for any act or neglect of the Department relating to or connected with the contract. Claimant does not dispute this, but says that at no time was this question raised until it was raised in the brief filed by the Attorney General, and that it was greatly surprised and, therefore, this Court should not consider it. That payment was finally made is not denied. This provision of the contract is set forth in the complaint. Just how they were taken by surprise does not appear. It was a part of the contract and certainly known to the claimant at the time the contract was entered into.

In the case of Urech vs. State of Illinois, 8 C. C. R., page 212, this Court held that “where party is paid amount provided in contract, and it is provided therein that acceptance of payment shall release State from any and all claims and liabilities thereunder, an allowance for an additional amount claimed as damages would constitute extra compensation and is prohibited by the Constitution of the State of Illinois.”

The claimant cannot now be heard to say that it did not know that such a provision was in the contract. This was a contract that was voluntarily and fairly entered into by both parties.

At the time the claimant received the final payment, it must be held to have been familiar with this provision of the contract, and the constitutional provisions herein referred to, and for these reasons we hold that the claimant, if entitled to an award, has waived that right. An award, therefore, will be denied.