Meadow Valley Contractors, Inc. v. State Department of Transportation
2011 UT 35
Utah2011Background
- MVC contracted with UDOT for I-215 paving; Southwest subcontracted paving work under MVC.
- At a June 2003 pre-pave meeting, Squire told MVC/Southwest ribbon paving was not allowed where it caused >2-inch vertical grade separation.
- Southwest proposed a 5:1 or flatter taper to mitigate grade separation; Squire rejected it, maintaining ribbon paving was not permitted.
- MVC/Southwest did not provide written notice within 5 days as required by contract §1.7 and continued work under the alleged change.
- Southwest used block paving due to ribbon-paving ban, increasing costs; UDOT imposed a $166,416 thickness penalty for overall five-inch pavement
- The Board of Review recommended denial; trial court awarded MVC damages; UDOT appealed; MVC cross-appealed on thickness interpretation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did UDOT breach by banning ribbon paving? | MVC argued contract allowed ribbon paving and the ban breached. | UDOT argued contract allowed changes; Ribbon ban valid under §1.5/§1.7. | UDOT did not breach; contract allowed changes. |
| Did MVC waive/diminish claims by failing to give written notice within 5 days? | MVC did not timely notice, waiving claims. | Notwithstanding, §1.7 requires notice; failure to notice waives claims. | MVC waived claims due to failure to provide timely written notice. |
| Did UDOT orally modify the contract's notice provisions? | MVC claimed oral direction satisfied notice. | No written modification; no modification of notice provisions. | UDOT did not orally modify the notice provisions. |
| Is MVC entitled to damages for thickness penalty given ambiguity in thickness provisions? | MVC argued 3/8-inch deficiency applies per lift. | UDOT argued 3/8-inch applies to total five inches. | Contract ambiguous; record supports UDOT’s interpretation; thickness denial affirmed. |
| Can an assignee recover damages in the assignor’s breach under SME Industries framework? | Southwest seeks damages via MVC’s claims. | Assignee cannot recover damages suffered by assignor; issue not preserved. | Not reached on plain error; majority notes assignment issue is complex and not essential to ruling. |
Key Cases Cited
- Thorn Construction Co. v. Utah Department of Transportation, 598 P.2d 365 (Utah 1979) (written notice not required when engineer orders extra work)
- SME Industries, Inc. v. Thompson, Ventulett, Stainback & Associates, Inc., 28 P.3d 669 (Utah 2001) (assignee may recover only damages suffered by assignor)
- Procon Corp. v. Utah Department of Transportation, 876 P.2d 892 (Utah Ct. App. 1994) (footnote discussion on waiver of notice provisions)