Town of New Ross v. Ferretti

815 N.E.2d 162, 2004 Ind. App. LEXIS 1835, 2004 WL 2106542
CourtIndiana Court of Appeals
DecidedSeptember 22, 2004
Docket54A04-0310-CV-515
StatusPublished
Cited by18 cases

This text of 815 N.E.2d 162 (Town of New Ross v. Ferretti) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Town of New Ross v. Ferretti, 815 N.E.2d 162, 2004 Ind. App. LEXIS 1835, 2004 WL 2106542 (Ind. Ct. App. 2004).

Opinion

VAIDIK, Judge.

Case Summary

The Town of New Ross appeals the $57,393.57 judgment that the trial court *164 entered in favor of Scott Ferretti d/b/a Ferretti Construction based upon the theories of breach of contract and unjust enrichment. Ferretti ecross-appeals, contending that the trial court should have awarded him pre-judgment interest. Because the public work contract between the parties included the costs of implementing a storm water drain plan, we conclude that the Town of New Ross must pay Ferretti for those costs and pre-judgment interest for those damages. In addition, because of the dearth of evidence regarding whether any of the changes Ferretti made to the project were mandated by state law, we remand for such a determination. In the event that any of the changes were mandated by state law, we conclude that Ferretti must be compensated for them as well. However, we conclude that the trial court erred in awarding damages to Ferretti for the remaining changes he made to the project that were not memorialized in writing because to do so would violate public policy. We therefore affirm in part, reverse in part, and remand in part.

Facts and Procedural History

In the spring of 2000, the Town of New Ross ("the Town"), which is a town in Montgomery County consisting of approximately 400 people, advertised a notice in a local newspaper that it was accepting bids for construction of the Walnut Township Volunteer Fire Department. Between tax dollars and grant money, the Town raised approximately $300,000.00 for the construction of the fire station. The Town put together a bid package for the project, which contained specifications for the fire station. However, the bid package did not contain State-approved blueprints of the fire station; rather, it contained drawings that were prepared by the fire department's Building Committee, which "was established to represent the [three-member] Town Board and to act as a liaison between the Town and [its] chosen general contractor[.]" Tr. p. 278.

On April 11, 2000, Seott Ferretti, who is a general contractor doing business as Ferretti Construction, submitted a bid of $266,675.00. The following paragraph was included as part of Ferretti's bid:

Without State approved plans there are several items that may be of concern after state plans have been drawn. We would like to bring this to your attention at this time, as ... state codes and requirements may force us to abide per plans. Thus, changing proposal costs in these or such areas, all costs and proposals are pending state approval.

Appellee's App. p. 43.

At the April 18, 2000, regular meeting of the Town Board, bids for the fire station project were opened. There were two bids for the project, of which Ferretti's was the lowest, and the Town Board took the bids under advisement. Two weeks later, the Town Board conducted a special meeting with Ferretti to discuss the project. At this meeting, Ferretti reiterated his concern that there were no State-approved plans for the fire station. Ferretti also advised the Town Board that a drainage plan had to be adopted.

The Town Board later accepted Ferret-ti's bid. On June 27, 2000, the Town and Ferretti entered into a Cumulative Agreement for Public Works ("the Agreement"), which totaled $273,825.00. 1 The Agreement specifically referred to and incorpo *165 rated Ferretti's bid, which provided that Ferretti would be compensated for the additional costs of complying with "state approved plans" and "state codes and requirements." Appellee's App. p.48. The Agreement also provided that additional changes to the cost of project must be made "in writing." Appellee's App. p. 8, 9, 10.

Thereafter, the Town hired Michael Whitecotton, a licensed architect, to prepare plans of the fire station for State approval. After accepting the plans, the Town forwarded them to the State for approval. However, the State returned the plans without approval and advised that before it could approve the plans, a' survey had to be performed and a storm water drain plan had to be implemented. In response, the Town hired Deckard Engineering to perform the survey and to design the storm water drain plan. The Town Board also authorized Ferretti to negotiate a drainage easement with The Farmers State Bank. In order for the storm water drain plan to be approved, it was necessary to connect the fire station to the town storm water drain system, which required trenching through the bank's parking lot. The Town and The Farmers State Bank subsequently executed a drainage easement. '

Construction on the fire station began in January 2001, and the fire station was completed in June 2001. As the project proceeded, Ferretti made several changes to the original plans for the fire station. The major change involved implementing the storm water drain plan, which the State required before it would approve the plans. Ferretti alleged that the other changes were either required by State law, such as installing showers and grab bars that complied with the ADA and draft stops in the truss assembly, or requested by members of the fire department's Building Committee, such as installing a cafeteria door and extra cabinetry in the kitchen, a second 200-amp electrical service for fish fries, and wainscoting on the exterior of the building. After the project was completed and Ferretti received $273,325.00 as provided for in the Agreement, Ferretti submitted an itemized list of the additional work he did on the fire station to the Town Board. See Appellee's App. p. 13-16. The cost of the changes to the project totaled $57,393.57, of which the storm water drain plan accounted for $20,142.54. Because members of the Building Committee, who asked Ferretti to make the changes, were not authorized to make any changes to the fire station or to spend any money without approval from the Town Board and because the changes Ferretti made to the fire station were not specifically set forth in any written document or "change order," the Town refused to pay Ferretti $57,398.57.

In December 2001, Ferretti filed a complaint against the Town for $57,898.57. The complaint alleged breach of contract and unjust enrichment. Following a bench trial, the trial court issued findings of fact and conclusions of law. Specifically, the trial court made the following conclusions of law:

1. Specifications for public works projects may be altered or changed as necessary pursuant to I.C. 36-1-12-18. There were no change orders executed by the parties in accordance with the statute. w
2. 'The [Agreement], which referenced and incorporated Ferretti's bid, was subject to the costs associated with obtaining state-approved blueprints and a storm water drain plan, including Fer-retti's costs of complying with such specifications. The fire station could not have been built unless a storm water drain plan was approved and carried *166 out. Because the parties anticipated the storm water drain plan and incorporated it in the agreement, it did not require the Town to follow the change order provisions of the statute.
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Bluebook (online)
815 N.E.2d 162, 2004 Ind. App. LEXIS 1835, 2004 WL 2106542, Counsel Stack Legal Research, https://law.counselstack.com/opinion/town-of-new-ross-v-ferretti-indctapp-2004.