Summers Drilling & Blasting, Inc. v. Goodwin & Goodwin, Inc.

2020 Ark. App. 194, 598 S.W.3d 853
Court of Appeals of Arkansas·Decided March 18, 2020·Published·Cited by 1 cases

Opinion

Cite as 2020 Ark. App. 194 ARKANSAS COURT OF APPEALS DIVISION IV

No. CV-19-489

Opinion Delivered: March 18, 2020

SUMMERS DRILLING & BLASTING, APPEAL FROM THE SEBASTIAN INC., A/K/A SUMMERS DRILLING, COUNTY CIRCUIT COURT, FORT INC. SMITH DISTRICT APPELLANT [NO. 66FCV-17-696]

V.

HONORABLE J. MICHAEL FITZHUGH, GOODWIN & GOODWIN, INC. JUDGE APPELLEE

AFFIRMED IN PART; REVERSED AND REMANDED IN PART

PHILLIP T. WHITEAKER, Judge The appellant Summers Drilling & Blasting, Inc. (SD&B), a subcontractor, was sued by the appellee Goodwin & Goodwin Inc. (Goodwin), a general contractor, under the theory of breach of contract. The Sebastian County Circuit Court found that SD&B had breached the parties’ subcontract by failing to perform its work in accordance with the contract’s plans and specifications and ultimately by refusing to complete the contract. The court awarded Goodwin $132,792.26 in damages, plus costs and attorney’s fees. On appeal, SD&B argues (1) that Goodwin’s claims sound in tort, not in contract; (2) that even if Goodwin’s claims were properly pled as a contract action, Goodwin failed to prove a breach of that contract; and (3) that the court’s award of damages was not supported by

the evidence presented. We disagree with SD&B’s first two arguments on appeal but agree that a remand is necessary for a recalculation of damages.

I. Facts and Procedural History Goodwin is a general contractor employed by the Arkansas Highway and Transportation Department (AHTD) and the City of Fayetteville to assist in the Porter Road–Highway 112/71B Widening and Interchange Project (“the Project”) in Fayetteville, Arkansas. In December 2016, Goodwin obtained and accepted a bid from SD&B in which SD&B agreed to drill and blast rock along a designated route of the Project for the relocation of an existing sewer line, and Goodwin agreed to pay SD&B $181 per blasted foot with a 1,350-foot minimum.

SD&B began work on the project. After having completed 1,204 linear feet of work, it sent Goodwin an invoice requesting $217,924 for services rendered. Goodwin paid $185,235.40, or 85 percent of the invoice less a 15 percent retainage. Approximately halfway through the project, Goodwin discovered that certain areas blasted by SD&B were not as deep as required. As a result, Goodwin rented equipment and employed crews to hammer to the required depth, resulting in a delay of the project. SD&B subsequently removed its equipment from the job site.1 At the time of withdrawal, SD&B had submitted two other invoices in the amounts of $28,598 for 158 linear feet, and $32,761 for 181 linear feet. Goodwin did not pay these two invoices. In total, SD&B invoiced Goodwin

1 When SD&B withdrew from the project, it had blasted 1,540 feet, but the project plans specified relocation of approximately 1,650 linear feet of sewer line.

$279,283 for the work completed, but Goodwin paid only $185,235.40, or 85 percent of the original invoice.

In July 2017, Goodwin filed suit against SD&B for breach of contract. Goodwin alleged that SD&B had breached its contract by failing to blast to the depths specified by the Project plans and in failing to complete the work. SD&B denied any breach, contending that the written contract specified only a minimum distance to be blasted— 1,350 feet—and made no mention of a required depth. Because it had blasted the minimum distance specified in the bid and because drilling to a required depth was not an express term of the contract, SD&B claimed that there could be no breach.

The parties presented their dispute to the court at a bench trial. The circuit court was presented conflicting positions and evidence concerning the terms of the agreement between the parties and the performance of the parties pursuant to the terms of the agreement. Goodwin took the position and presented evidence that its contract with SD&B required performance under the terms and specifications of the Project plans that Goodwin had with AHTD and the City of Fayetteville; that those Project plans detailed the depth at which the sewer pipes were to be positioned; and that SD&B failed to meet the depth specifications of the Project plans. SD&B took the position and presented evidence that its bid constituted the written contract between the parties and that this written contract was silent as to required depths. SD&B also contended that Goodwin never provided the depth specifications of the Project plans and had not provided a suitable

blasting site in that there was an unacceptable amount of overburden 2 hindering its ability to effectively blast. Goodwin disagreed and presented evidence that it had provided the Project plans to SD&B and contended that SD&B had specified in the agreement that the naturally occurring overburden should remain in place in order to prevent flooding of the ditches.

After hearing all the evidence and reviewing the documents provided, the court made specific findings concerning the parties’ agreement: (1) the parties had entered into a contract; (2) the contract obligated SD&B to blast rock to grade; and (3) SD&B breached the contract by not blasting to the required depths under the contract and had left the job prior to completion. Concerning overburden, the court found that while there was some dispute as to the removal of overburden, Goodwin had performed as required under the contract. Concerning damages, the court found Goodwin was damaged as a result of SD&B’s breach. The court calculated damages equal to the amount Goodwin incurred to complete the project less the amount it would have paid SD&B if the contract had been performed without breach, awarding Goodwin $132,792.26 in damages. SD&B appeals.

II. Standard of Review

SD&B appeals the judgment of damages from a breach-of-contract cause of action entered after a bench trial. In appeals from civil bench trials, our standard of review on appeal is not whether there is substantial evidence to support the findings of the court but

2 The term “overburden” is used to describe soil and ancillary material above the bedrock in a given area.

whether the court’s findings were clearly erroneous or clearly against the preponderance of the evidence. Barnes v. Wagoner, 2019 Ark. App. 174, at 3, 573 S.W.3d 594, 595–96. A finding is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with a firm conviction that a mistake has been made. Id. Where the issue is one of law, our review is de novo. Id.

III. Analysis

A. Negligence v. Breach of Contract In its first point on appeal, SD&B argues that Goodwin’s cause of action actually sounds in negligence rather than in contract and that Goodwin failed to plead or prove a negligence claim. Essentially, SD&B argues that Goodwin’s challenge is to the sufficiency of its performance under the contract and not to the breach of any specific provision of the contract. SD&B then concludes that because it did not breach a specific provision of the contract, the judgment against SD&B should be reversed, along with the court’s award of attorney’s fees, which are available only in breach-of-contract actions.

We begin analyzing SD&B’s argument by noting that the question of whether a cause of action sounds in tort or in contract usually arises in the context of either determining the appropriate application of the statute of limitations or in the award of attorney’s fees. In reviewing the circuit court’s analysis as it relates to its characterization of the nature of the claim, we look to the facts alleged in the complaint to ascertain the area of the law in which it sounds. See Sturgis v. Skokos, 335 Ark. 41, 48, 977 S.W.2d 217, 220 (1998); McQuay v. Guntharp, 331 Ark. 466, 470, 963 S.W.2d 583, 584 (1998).

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Summers Drilling & Blasting, Inc. v. Goodwin & Goodwin, Inc., 2020 Ark. App. 194, 598 S.W.3d 853 (Ark. Ct. App. 2020).

2020 Ark. App. 194 (Summers Drilling & Blasting, Inc. v. Goodwin & Goodwin, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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