Malcolm International LLC v. Fisher Sand & Gravel-New Mexico, Inc.
1:23-cv-00188
D.N.M.Jun 26, 2025Background
- Fisher Sand & Gravel was the primary contractor for a bridge project in New Mexico and subcontracted Malcolm International, LLC for work on the bridge piers and components.
- Before construction began, the project design changed to raise the piers, causing delays and requiring more materials; Fisher and NMDOT approved the design change via Change Order Six, but Malcolm was not a party to that change order.
- Malcolm received payment from Fisher for increased material costs but not for additional labor or other costs due to delay; both Fisher and Malcolm sought reimbursement from NMDOT, but this was denied.
- Malcolm sued Fisher for breach of contract, unjust enrichment, and breach of the duty of good faith and fair dealing. Only the breach of contract claim survived the motion to dismiss.
- Fisher moved for summary judgment, asserting that contract terms barred Malcolm’s claim for delay costs absent a written agreement, and simultaneously sought declaratory judgment regarding its rights and fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Fisher’s failure to file a claim against NMDOT breach the contract? | Fisher failed to adequately represent Malcolm’s claims for compensation with NMDOT. | Malcolm abandoned this theory and failed to support it; allegations are conclusory. | Summary judgment for Fisher; claim not supported. |
| Is Malcolm entitled to compensation for increased costs/delays under Article 10 (changes clause)? | Article 10 entitles Malcolm to payment for extra work performed or materials furnished, including delay-related costs. | Article 10 only covers work/mat’l changes with written order or within Schedule C; delay costs require written agreement per Article 2. | Article 10 does not apply; Malcolm’s claim is for delay damages, not extra work. |
| Does Article 2 bar Malcolm’s recovery for delay without written agreement? | Article 2 was modified by parties’ conduct; waiver should apply or an exception should exist for unanticipated delays. | Article 2 expressly bars delay damages without written agreement; no waiver or exception. | Article 2 is clear, was not modified, and bars recovery; summary judgment for Fisher. |
| Is Fisher entitled to declaratory judgment on its contractual rights and fees? | Not directly addressed. | Declaratory judgment should mirror summary judgment outcome. | Declaratory judgment denied as duplicative and unnecessary. |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment burden-shifting framework)
- Sanders v. FedEx Ground Package Sys., Inc., 18 P.3d 1200 (N.M. 2008) (elements of breach of contract)
- Mark V, Inc. v. Mellekas, 845 P.2d 1232 (N.M. 1993) (ambiguity in contracts)
- Medina v. Sunstate Realty, Inc., 889 P.2d 171 (N.M. 1995) (modification of contracts by conduct)
- Strata Prod. Co. v. Mercury Expl. Co., 916 P.2d 822 (N.M. 1996) (elements of promissory estoppel)
- State ex rel. Santa Fe Sand & Gravel Co., Pecos Constr. Co., 519 P.2d 294 (N.M. 1974) (written authorization for extra work in construction contracts)