Thorn Construction Co. v. Utah Department of Transportation

26 Cont. Cas. Fed. 83,725, 598 P.2d 365, 1979 Utah LEXIS 872
CourtUtah Supreme Court
DecidedJuly 16, 1979
Docket15647
StatusPublished
Cited by15 cases

This text of 26 Cont. Cas. Fed. 83,725 (Thorn Construction Co. v. Utah Department of Transportation) is published on Counsel Stack Legal Research, covering Utah Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thorn Construction Co. v. Utah Department of Transportation, 26 Cont. Cas. Fed. 83,725, 598 P.2d 365, 1979 Utah LEXIS 872 (Utah 1979).

Opinions

MAUGHAN, Justice:

Defendant appeals from a judgment in favor of plaintiff in the amount of $24,500, representing additional compensation for work performed by plaintiff under a road construction contract. We affirm. No costs awarded.

On March 27, 1973, plaintiff and defendant contracted for the construction of an access road at Rockport State Park, near Wanship, Utah. The contract was awarded to plaintiff according to the standard process of competitive bidding, plaintiff having bid the lowest figure. Incorporated into the contract were the State of Utah Standard Specifications (herein Standard Specification), which set forth certain requirements and minimum standards for material used in such projects. Prior to submitting its bid, several representatives of plaintiff [367]*367and one Virgil Mitchell, an engineer’s aide for defendant, toured the work site to inspect conditions and potential sources of borrow (fill material). As part of this tour, the party stopped at the “Utelite property”, which was close to the construction site. Mr. Mitchell stated, according to testimony believed by the district court, the Utelite pit was available and could be used for borrow. Several other sources of borrow material were discussed, although apparently not visited; plaintiff later computed his unit cost for loading, hauling and unloading the borrow material based upon the Utelite property. After defendant conducted certain tests on the material, it was discovered it did not meet the minimum standards, and defendant informed plaintiff that the Utel-ite pit could not be used. Plaintiff then obtained suitable borrow material from the “Crandall pit,” which was 1.7 miles farther from the site than was the Utelite pit.

Plaintiff asserted at trial that due to the greater distance from the construction site, and certain conditions at the Crandall pit making loading and hauling more difficult, it incurred extra expenses over its bid price of $1.20 per yard of borrow. Defendant argues before us, as it did at trial, that Mr. Mitchell did not misrepresent the condition of the borrow at the Utelite pit, and that plaintiff was not entitled to rely on his statements.

Plaintiff’s second claim before the district court was for additional compensation for extra work performed at the request of defendant involving the widening of a certain turning area in the road. Defendant countered that plaintiff was not entitled to extra compensation because it had not submitted a written request, as required by the Standard Specifications.

Plaintiff also asserted at trial it was entitled to recalculate its total costs with respect to the amount of borrow actually used on the project and renegotiate a supplemental agreement on a “force account,” or total cost basis. Defendant disagrees, and points out that the actual amount of borrow used was only 45 percent of the original estimate. Defendant contends plaintiff is therefore entitled only to an adjustment for its fixed costs according to § 104.02 of the Standard Specifications as it relates to adjustments in the contract because of major underruns.

Plaintiff presented evidence indicating the extra expenses incurred because of the above problems totalled $38,642.83; the district court sitting as the trier of fact, awarded plaintiff $24,500, without indicating what amounts pertained to plaintiff’s respective claims. Defendant asserts before us the district court erred in its rulings and there must be a new trial. We address the issues in the order presented above.

In its conclusions of law, the district court held that plaintiff was entitled to rely on the representations of Mr. Mitchell, as to the borrow from the Utelite pit and plaintiff could therefore recover for extra expenses associated with transporting borrow from the Crandall pit. We agree. The evidence presented on what Mr. Mitchell represented as to the borrow at the Utelite pit conflicted, to some degree; the testimony most favorable to plaintiff’s point of view came from Jerry Thorn; president of plaintiff, who stated: “It was represented to us, this material was available and could be used for borrow on this project.”

The district judge, as the trier of fact in this ease, accepted this statement as true and held Mr. Mitchell had, on behalf of defendant, made a positive representation that the borrow was suitable for use on the project, on which plaintiff was entitled to rely. We believe plaintiff could have justifiably relied upon the above statement that the material “could be used for borrow on this project,” especially in view of the fact that Mr. Mitchell showed plaintiff’s representatives the location of the pit. Plaintiff’s officers were entitled to believe as they did, viz., the state had determined the Utelite pit was closest to the construction site and contained material suitable for use as borrow in the project. The close proximity of the pit to the construction site, plus statements of Mr. Mitchell made it inconceivable plaintiff would have chosen any other site for borrow. We reach this result [368]*368notwithstanding the existence of the following provision in the Standard Specifications, Section 102.05:

. The bidder is required to examine carefully the site of the proposed work, the proposal, plans, specifications, supplemental specifications, special provisions, and contract forms before submitting a proposal. The submission of a bid shall be considered prima facie evidence that the bidder has made such examination and is satisfied as to the conditions to be encountered in performing the work and as to the requirements of the plans, specifications, supplemental specifications, special provisions, and contract.

It is a reasonable principle of law that:

A contractor of public works who, acting reasonably, is misled by incorrect plans and specifications issued by the public authorities as the basis for bids and who, as a result, submits a bid which is lower than he would have otherwise made may recover in a contract action for extra work or expenses necessitated by the conditions being other than represented. [Citations]1

A case illustrating this principle is E. H. Morrill Company v. State, 65 Cal.2d 787, 56 Cal.Rptr. 479, 423 P.2d 551 (1967), in which the contractor claimed damages arising from a misrepresentation in the specifications as to the amount and size of subsurface boulders at the construction site. The court stated the specifications in question did not merely present the results of the state’s own tests, but flatly asserted the bidders could expect to confront boulders of a certain range of size. It was held the contractor was entitled to rely upon the representations made, notwithstanding the existence of general language in another section of the contracts requiring the contractor to “satisfy himself as to the character, quality and quantity of surface and subsurface materials or obstacles to be encountered.” In Hollerbach v. United States, 233 U.S. 165, 34 S.Ct. 553, 58 L.Ed. 898 (1914), the U.S. Supreme Court faced a similar case. The contractor, in repairing a dam pursuant to government specifications, was misled by incorrect specifications as to certain material conditions to be encountered. The contract contained general provisions requiring the contractor to inspect the site and assure himself of all conditions necessary to make a proper bid.

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Thorn Construction Co. v. Utah Department of Transportation
26 Cont. Cas. Fed. 83,725 (Utah Supreme Court, 1979)

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Bluebook (online)
26 Cont. Cas. Fed. 83,725, 598 P.2d 365, 1979 Utah LEXIS 872, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thorn-construction-co-v-utah-department-of-transportation-utah-1979.