*1 COMPANY, CONSTRUCTION NORDIN al., Inc., Appellants, et cases). NOME, Appellee (two
CITY OF Appellant, NOME, v. NORDIN
CITY OF Inc., COMPANY, CONSTRUCTION Appellees. al., et 1290, 1299 and 1520.
Nos.
Supreme of Alaska. Court 1, 1971. Oct.
Rehearing Denied Oct.
45'0 approved the final estimates he Nome, F. Millard Kennedy', R.C. Engineering, Philleo of Mr. Philleo Niewohner, Fair- Ingraham &
Ingraham construction, supervised testified banks, of Nome. that he had determined the work was ac- Staley of Howard Folta and Richard *3 ceptable, he had the and that so notified Delisio, Schaible, Fair- Staley Merdes, & City. Oles, H. Hal- and H. banks, and Stuart G. 1965, City Council 4, the Morri- stead, Leedy, and Oles December Degarmo, On remainder Seattle, Nordin the Washington, pay for Nordin Con- son, voted to $20,000 for Fidelity reserving Inc., price, Co., United States contract struction others. deficiencies. Co., Bronson, and certain and Guaranty correction & City engaged February In DIMOND, and BONEY, J.,C. Before Beck engineering firm of R. W. the Seattle ERWIN, and CONNOR JJ. inspect & Associates to further the sewer OPINION system. and George water Mr. Martin ERWIN, inspection, spending approximate- made the Justice. ly days going through and three the utilities the award revolves around This case system, punch a City compiling list the work of Nome payment ultimate con- which seemed to deficient. Febru- a On “City”] of construction [hereinafter, ary City system Manager wrote a letter a water sewer tract for enclosing punch to Nordin Co., list and Inc. & Construction Nome to Nordin necessary. dicating what corrections were [hereinafter, of Fairbanks Associates Thereafter, required issued Nordin a check finding a The “Nordin”]. $20,000. money paid by amount of Nordin returned return Nordin to substantially this check1 and the issued another City for failure of Nordin $17,500, $2,500 retaining the amount of perform the contract. as the monies due under the contract to Ar- Engineering & Philleo firm The completion remaining insure correc- Fairbanks [herein- chitectural Services punch tions from the Martin list. Mr. prepared Jeff- after, Engineering”] “Philleo Heating, ress a Plumbing of Globe & for plans specifications subcontractor, that the de- Nordin asserted following elements: basic consisting five minor ficiencies were corrected with However,
exceptions.
de-
correction was
plumbing
nied
foreman on
at trial
job
for Globe.
April 23, 1966,
On
a
Nordin submitted
claim
compensa-
for additional
$196,334.59,
tion of
required
for extra work
by changed
response,
conditions.
present
filed
against
action
Nor-
din,
associates,
surety,
and several
for
project
The
was bonded
United States
$3,786,542.16,alleging a failure of substan-
Fidelity
Guaranty Company.
performance by
tial
resulting
Nordin
years
during the
place
took
Construction
consequential damages.
Nordin denied
payments
periodic
with
breach and
for
counterclaimed
the amount
When
progressed.
as
work
made
set forth in the claim for additional work.
submitted
Pay
Estimate”
“Final
summary
There were
motions for
several
to December
September period of
change
and for
venue
the work
claimed
1965, Nordin
5, 1969,
September
were denied. On
City’s resi-
The
substantially completed.
re-
Freese,
pre-trial conference was held which
testified
Mr. Gerald
engineer,
dent
accept
Payment
“Acceptance
Re-
the check because of the
of Final
Nordin declined to
lease” contract clause.
stipulation
suited in a
should
be returned
trial
be held
jury further
found that
Anchorage, and in an order that
parties
Nordin should be awarded its counterclaim
file amended pleadings.
performed.
Judgment
extra work
complaint
amended
was filed on
parties
entered on this
Both
verdict.
IS, 1969,
September
alleged
An
appealed.
from a
appeal
substantially
work did not
comply
60(b)
denial
Rule
relief from
Civil
complaint
terms
contract.
fur-
judgment motion has also been consoli-
ther stated that as
result of
the substan-
dated.
nonperformance,
tial
was entitled to
I
performed,
compensation
for the work
*4
The central
case,
issue in this
repay
$1,391,542.16
and should
the
which
both at trial
appeal,
and on
wheth
been
paid.2
had been
er
substantially
Nordin
performed the con
complaint,
amended
In answer
tract. Before considering
jury
whether a
allegations
the
specifically denied
Nordin
question
presented
was
by
on that issue
breach, and counterclaimed
of substantial
below, however,
necessary
is
to
for
work
$198,854.59
extra
for
sum of
examine
City’s
theory
recovery.
of
only
by
The
required
changed conditions.
City
The
did
proceed
alleged by
theory
was
a
Nordin
on
defense
affirmative
of damages for
performance.3
defective
acceptance by the
Rather,
City sought
restitution of
pleading
City
In its final
denied the
paid,
money
on
based
an alleged failure
allegations
counterclaim,
re-
of
performance
substantial
by Nordin.
plied
by stating
to
affirmative defense
doing,
so
City
upon
relied
principle,
occurred, or,
acceptance
that
no
had
well settled in American
alternative,
construction con
acceptance
(1)
that
if found:
“ * * *
law,
tract
that
per
‘substantial
go
faulty
did not
to
materials
of
because
formance’ is the condition—the fact that
contract,
the terms of the
(2) could
4
must exist
payment
before
is
due.”
defects,
(3)
vitiate latent
nulli-
would be
distinction between
fraud,
recovery
theories of
fied as induced
actual or con-
simply
was
Thompson
stated
Little
structive, of
the architect/en-
Strawn,
Ass’n
Water
917
gineer,
Engineering.
Philleo
(Colo. 1970), as follows:
The case was
submitted to
which
found that
substantially
Nordin failed to
The rules appear to
prom-
be that if the
perform and that
paid
the total
proves
amount
isor
complete and
perform-
full
2. 3. For a case
would
formance.
pleadings,
formance.
courts have
contractor
relief
ages
tion of
whose
struction
Co. v. Reliance
on
complete. Although
mon law
recting
had been retained
covery
(1961).
(Alaska 1970).
In this
building
measured either
performance
structure
result,
allowing
deficiencies
rule,
case, however,
sought primarily
damages
apparently
gradually
Annot.,
setting
contracts
cases of substantial
remedy
no
contractual
due to the defective
Ins.
“owner” must
Under
the decrease in value
from final
recovery
was less than full
or,
for breach of a con-
see
out
not without
76 A.L.R.2d
Co.,
moved to the
forgot
if economic waste
of contract
Hopkins
principles
the cost of cor-
475
recovery by
could be
City, by
that
harsh com-
payment.
contractor
show
rely
conflict,
Constr.
$2,500
dam-
posi-
per-
per-
nei-
223
re-
4.3A
Paving Corp.,
New
Tex.Bar
Co.,
Bride &
the contract.
Rather,
tracts
Performance
§
contractual
a
toas
see
such
ther cost
(1931) ;
(1960).
31.10
failure
Part
(1937).
Corbin on
a
of Charlton v. J. C. Blunk Constr.
253 Iowa
entitle Nordin to no
York,
:
failure
defective,
II,
See also
of
Wachtel,
[5]
J.
Sioux
Damages
integrated
correction nor
recovery
Am.Jur.2d,
infra.
City’s
31 Colum.L.Rev.
(1969) ;
For
substantial
Contracts
contractual
Building
Guittard, Building
Government Contracts
Iowa
burden
where there has
system,
v. Western
possibility
Note,
Contracts
(1969)
Restitution,
decreased
recovery
§
it constituted
Contracts
N.W.2d 829
performance,
performance,
as a
701
Substantial
;
to
Asphalt
at 314
4 Mc
whole,
value.
N.W.
prove
Con
375;
non-
system, or
utilidor
the com-
utilidor
recover
entitled
2.4%
anee,
is
he
bargained
to less than
system. This amounts
full consideration
plete
1½%
something
establishes
entire sewer and water
proof
for;
if the
Yet,
is
complete performance,
full and
built
less than
.Nordin.
he
performance only,
has found
is,
substantial
the record
price
$1,391,542.16,
to recover the contract
entitled
defendants
against
necessary
re-
expenditures
en-
less those
of the value
whereas 2.4%
performance bar-
complete the
quired
system ($748,733.00)
tire utilidor
for;
performance falls
and if the
gained
only $17,969.59.
equal
substantial,
being
prom-
then the
short of
argues
testimony
there was no
recovery.
isor
entitled
concerning the ten-inch direct burial water-
recover, therefore,' it was
In order
pipe,
raw water
intake and pipeline,
a failure
prove
cumbent
the sewage
plant
treatment
building, lift
substantially comply with
by Nordin to
utiliducts,
station and
and only de minimis
contract.
construction
terms
testimony as
storage
to the water
tanks
legal principles,
many general
As
pumprooms.
precise rules
lay down
impossible to
Previously
has held
this court
govern the is-
application
mathematical
*5
can
presented
is
unless the court
issue
of sub-
a failure
to
amounts
of what
sue
differ
say
minds cannot
reasonable
that
Corbin
Professor
performance.
stantial
order
presented.6 In
on the issue to be
as follows:5
problem
summarizes
Nordin,
be
of
we must
uphold the view
easy
lay
for
It is not
down rules
say
was no
that
there
evidence
able to
determining
amounts to ‘substan-
what
per-
of substantial
a failure
upon which
performance/
justify a
tial
sufficient to
inferred
reasonable
could be
formance
price
(subject
for the contract
in the
is viewed
the evidence
jurors when
asserted)
injury,
to a counterclaim for
if
We,
light
favorable to
most
always
particular case.
It
pre-
the evidence
therefore, must review
question
fact,
degree, a
a
of
a matter of
rule in this
apply
the trial
sented at
question that must
determined rela-
be
case.
tively
complex
to all the
factors
other
AND UTILIDUCTS
A.
every
that
UTILIDOR
exist
instance. The vari-
ation
gen-
in these factors is such that
of
the construction
A basic element
of
eralization
difficult and the use
water
and
the sewer
utilidor
contain
precedents
dangerous,
cases as
(foot-
proper
of
materials
the use
pipe was
note omitted)
select
of
Six inches
bedding and backfill.
performance
of
as
extent
un-
placed
Such factors
be
required to
gravel
1
was
class
have ob-
of
breach
utilidor;
and the wilfullness
material
unclassified
der
vious
free
excavation,
relevance.
from the trench
selected
throughout
material,
required
this case
argued
was
organic
utilidor;
fail-
one
is no
a
along
that there
the sides of
placed
gravel
performance could be
2
was
ure of substantial
select class
and a half of
foot
top
maintained,
immediately on
states as fol-
specifically
placed
and
required to be
select
utilidor;
of
and six inches
lows :
of the
placed
Thus,
required to
testimony
gravel was
only
1
we have
of
class
1
backfill. Class
of the
only
surface
need to rebuild
of
12% 20%
(Alaska 1967) ;
5. 3A Corbin on
§
Contracts
704 at 318-
P.2d 913
Bertram v.
(1960).
also,
(Alaska
;
Harris,
1967)
19
See
Restatement of Con-
Mr. Charles there was utilidor. Nome extensive testified that the the The floor utilidor soil excavated from of the had settled streets misalignment. of Nome consists of there was had so tundra One area decomposed in vegetation, and caved is full of it was not safe to enter. One planks, drains, old firelines and old the section had it did not so flattened out that grade remains of the adequate carry sewage. old town. No have the gravel beach bedding. went into the The sharp dips utilidor was Another section had that were right ground laid developing. on the as it in the problems which he May it cause the in would utilidor examined Eberle Mr. system, but gaps in others observed considerable and observed of 1969 system would continue of the condition places where several were it. There many future. In deteriorate appreciably. had moved walls of the dropped out bottom places the system Mr. Smith observed When away pulled from utilidor; it had percent portion ten to twelve longer pins drift stringers, and re- inspect to be able needed he was ground from pressure preventing portions were and rebuilt. Other moved walls inward. moving the from in- jury could process failing. system and Mr. Vernon Buloard was in a similar fer that entire Mr. William contractors, Carlson, plumbing examined Nome condition. When Mr. Buloard at the re- trial, fifty trial system percent before spected system prior about Buloard testified part Mr. quest rebuilding. If apparently needed as follows: present everything upgrade condition system inoperative, is Mr. part inoperative. is Smith from utilidor Probably percent system opinion that entire was of the an- point or slumped in one now inoperative ten within relatively would be caving are walls other. walls—the years of initial construction from the date separated in, of the floor bottom rebuilding. The cost of substantial without up. coming silt and mud there’s as more rebuilding would be the same sewer lines many places the than cost initial installation. ice they’ve built badly that leaked stalagmites. up testimony could infer underneath like humics From line sewer forced the have to be rebuilt humic has will This ice whole joints and has broken the initial up years into the air the date of within ten mul- many construction, inoperative. instances. There’s apart in Almost the water saddles. of these tiple leaks on that the cause could infer into going used coupling pro- that was every the failure of Nordin problems was leak of the mains property compaction lines off re- bedding, backfill vide hydrants have the fire Two of especially now. view of quired wood The rotton been connected. expert testimony by never Mr. Smith *7 of the quite a few slumped in in system has had been if the design could succeed places in utilidor are places. specifications. There according to constructed through now. you crawl cannot as replacement would be much The cost through absolutely get way to There’s of initial con- as more than the cost of water in is over a foot it. There Thus, jury could find that struction. along majority the overall utilidor City, to breach the within due Nordin’s leaky lines sewer effluent from the construction, years ten from initial condi- are that exists now. These spend as much or to have to more rebuild saw. tions I system spent building as it in it. has shifting testified that Mr. Carlson B. AND WATER MAINS SEWER (or and the laterals sagging of the utilidor problems testimony of There is other misaligned them had utiliducts) system. Buloard work- with the entire Mr. homes not be made to the connections could plumb- plumber and on the as a foreman ed tearing they intended to serve without were aspects He testified ing of the contract. shifting had caused up the street. The was not instances work some At system plugged. to become the sewer specifications done in accordance with the impassable places system was several job of the entire was not that 20% of the utilidor had caved because the walls completed at all. in. improper back- burnt off from the that if Tar was inside Mr. testified Smith installation, only pipes. This rust in of the causes used in the outside fill fittings couplings Improper tank had to backwashed down line in pipes. pipes get This caused leaks order start flowing were used. to the water to sewer mains prime pumps. now exist. The wooden the line and to When which tank, excessively and not creosoted. milled were there wasn’t sufficient water allowing raw joints, This loose water to poured caused be hauled and into sewage to run out. Now the whole tank fill to it and the amount accumulate improperly pipes were system. leaks. water needed hooked those' up soldered, creating Return bins or only subsequently leaks. This was corrected when installed, causing the fittings were not changed source to Moon- water time repurchase to these items a later light Springs con- another construction hook-ups when were made. Anchors were pertinent tract not herein. installed, pipe, expansion causing the fittings placed Black were the water temperature changes, and contraction from galvanized treatment facilities rather than bend, po- hangars, “travel” off the ones that would not rust. The black fit- tentially improperly break. were Saddles rusted, tings contaminating the water in the large installed or not installed at all. A plant. water treatment majority of the water lines that were Mr. Buloard testified and Mr. Reader connected saddles were not con- confirmed that a crack exists in the foun- nected, making impossible nearly now dation plant, of the water treatment up. pitorifices, designed them hook fixed, has never causing the water permit pre- constant water circulation to to leak every out so that third fourth freezing, vent improperly placed; were as day storage goes dry attempt tank if no placed, pitorifices “absolutely are use- keep is made to it filled. Thus, every less.” home in Nome is re- Crinklaw, Mr. Howard former Nome quired a circulating pump. to have water city manager, testified that the saline cut- hangars, pipes from which the sewer off on the Snake River water intake was hang ceiling utilidor, from the lack tide, At high broken. the first the entire enough adjustment thread for in some system filled with salt water because the places and in deeply others are not cut failed to automatically cutoff close the enough, causing strip them adjust- when intake. ment is made. In at places least two Mr. Buloard testified that the chlorinator hangars pulled through ceiling be- sewage for the raw discharge was never dry cause of rot the wood of the utilidor. up hooked sewage at the plant treatment This hangars failure of the it im- made a result the was contami- possible adjust grade pipe. nating Bering Sea. The flex hoses that connect the sewer Mr. Crinklaw testified that the storm main to the individual sewers too *8 by drains were cut the contractor and not small and do not Furthermore, fit. these repaired, required by as the contract.
hoses were cut too short. These defects D. permit do not the hoses TESTIMONY BY to absorb the shifts CONTRACTOR in the utilidor and cause the hoses to come response testimony, to this off. This in turn causes sewer fluids and Fidelity United Guaranty States and run into the utilidor rather than into the Company presented oral and supporting sewer main. documentary testimony which was diamet- rically opposed to testimony much of the
C. WATER AND SEWAGE given on behalf City of Nome. Mr. TREATMENT PLANTS Freese, the engineer resident for Philleo There was a pipe broken for water intake project, the testified that compacting the in the Snake River and there way done, was no to was and that he recommended ac- prime pumps the to fill storage the water ceptance because he felt the was by tank normal means. water in the essentially complete and usable. He fur- for working who Jeffress, Mr. utiliducts were all that stated
ther as an of- of the contract City Manager at at the time Slagle, the Globe Mr. located as Hegdal, who and Mr. requested; engineer, fice had the time John bidding Nordin in operable, engineer and for was the detector was the saline that gone the construction had job, testified that not recon- drains were storm certain that according to that the Martin plans, forward Slagle Mr. himself. by direction nected made, punch were and that list corrections approved the that he stated further He by pitori- the deficiencies claimed witnesses pipes in the burning of holes Addi- City simply had not occurred. of those thaw and the elimination fices Gunderson, tionally, Leslie specifi- Mr. who called for which were wires manager for Nordin at Nome general cations. May, problems that indicated were superin- Payne, the Loren Mr. being caused utiliducts not located tailings mine used tendent, that he testified City, that the work was and extra in amendments required as beach sand and delays by necessary because of only hack- he and specifications, He locating property lines. testified in- material where original filled calling that he had sent several letters this testified He permitted. specifically spector Engineering the attention of Philleo and put logs or wood not he did that City, and identified several exhibits he compactors backfill, he had two that and copies as of the letters. Payne denied Mr. job. on the performing in- Engineering Mr. Philleo of Philleo way pipe inwas intake the water that dicated that he recommended to the properly that was asserted damaged and payment job and that be made period of during the worked and installed accepted, opinion because it that was his Payne job. Mr. they on the that were time performed according had been put pins were not the drift testified specifications. plans Mr. Phil- plans per the because as in the utilidors indicated that there leo further were by the changed ordered they were responsible spectors job to him on Slagle, no thaw wires and that Manager, times, relied them and all that he they were directed in because put given by the the assurances contractor that Engineering. by Philleo progressing satisfactorily. work was Associates, testimony, In rebuttal to the above Beck & of W.R. Mr. Martin Morris, inspected Hegdal, the utili- recalled Mr. Mr. Seattle, that he testified Buloard, Carlson, City, gave Doyle he Mr. Mr. Mr. requested dors Reader, inspection, again specifically deny Mr. result as a punch list plans compliance all of there had been constituted with the list necessary specifications. he thought would work he specifications. system up to bring the noted, previously As we have the suffi- check did not he Martin testified Mr. ciency performance of the contractor’s un- utilidors, he did used wood building der a or construction contract only defi- sewage, that the raw see generally an issue to be determined cov- frost certain wooden ciency trier fact.7 In order to overturn did system. He missing from ers were case, the verdict in this we must *9 frozen at ground was state that say that is there no evidence which February in inspection he made the time might finding reasonable minds differ in inspected he that the of performance and that failure on behalf plaintiff of the was substantial. from the inside. Super. 294, (App.Div. Thompson 191 A.2d 7. Ass’n v. See Little Water 1963). (Colo.1970) Strawn, Power-Matics, Ligotti, 79 N.J. Inc. v. position that formed contract. The trial court cor- advances the Nordin rectly substantially perform jury. submitted the issue to the of failure to unbelievable, “it that inherently and II go to task to and formidable hopeless is a vague against the argue and the record argues that if even nonen- testimony and the hometowners substantially perform, failed to defi- regard with to gineers” who testified value, received something permit to However, de- system. in we ciencies price retain the contract rule promulgate a which cline to performance rendered an unjust works testimony to be require expert contradicted enrichment.9 Nordin uses the doctrine as testimony in order for a by expert a catch-all to proposition advance the question presented.8 must deter- to be We no happened matter what in the lower jury question on there is a mine whether court and no matter what were the tactical of all the evidence and the examination positions parties, of the the court erred in raised reasonable inferences can be awarding Nordin the value of the serv therefrom. ices it rendered. An initial question below, clearly ap- whether, arises testimony From the as to under the Alaska Rules pears that reasonable minds could differ Civil Proce- dure,10 recovery may per- substantially on had for unjust whether Nordin had 8. ther other circumstances. inferred eral Reasonable formalized distinction is what der damages. ages contract such an tion sent *10 on obligation tected. or appropriate remedy tract and one based on we have plied tract without testimony ties to value workmen’s champ an mony Corp., tinguish P.2d An Although grounded any agreement implied in implied promise criminal based objective thereto, although in law and hand, “implied doctrinaire, form a arrive at approach. applied, from the seeks between contracts the services (quasi-contract) may held to make restitution is must he Employers An 501-502 on expectations compensation trier theory cases making any attempt fact. “implied a fiction an recovery contract; distinction between an It subjective; of fact. between the discussion law” weighed “implied surrounding [Bowker follows here is intention (Alaska 1962)], It Liability pay is an proper compensatory application recovery in fact” contract is are inarticulated, necessary effect “implied (Alaska 1970)], goods provided. implied clear that a with cases in fact” con- thereby pro- contract is fair market there is measure parties’ parties, law. State, Assurance facts quasi-con- based be some- based lay in law” on the [Beau expert based dam- testi gen- par- law dis- im- as- ac- or- no ei- on 10.Alaska 39-50(1963) ; 1, Williston on Contracts the value of the benefit being enforce, quired. ment of riched expectation §§ recovery for is the serving out party’s against any claim if pleading Alaska Civil claim as ing party claim, tled. claim for part: takenly designated relief to which he deems himself enti- designation. claim, counterclaim, See, 1, 3-3A at A [*] (c) (a) justice one plain pleading the transaction or adjudication A restitution person * * * subject Corbin on is Civil the detriment Restitution express claim and as if there had been a pleading based [*] statement of the interest demand for claim which relief, defense, opposing party, pleader Rule pleading shall contain shall state should not requires, Rule matter of (3d on When a or Contracts, n is whether an which sets forth a ed. cross-claim third- the court on * * * implied is entitled to provides 13(a) provides does not usually protect. presence 155(1) 1957) ; equitable shall another. occurrence at the time of which was ac- party [*] pleader claim (1) unjustly §§ if it arises promise a counter- a counter- limited to treat opposing 18-19 at has mis- Restate- (1937). of original Rather, require part: for the proper maxim terms, There show- relief, third short [*] en-
405 pleadings, where con- ment13 the state of the express on only an where enrichment supporting was factual evidence there complaint or counter- pleaded tract is Clearly this tied to request for relief. claim. idea that the contractor position is the suit bar, brought case at In the substantially comply fails with to who under paid all the to recover mqney rely specifications cannot plans and of sub- ground on the construction left recovery, for but must be the contract perform contract. failure to stantial proof of the value to provide to actual Nordin, it contractor, answered performance tendered. owner and counter- the contract performed proof adoption of burden this Nothing said extra work. claimed for in may problems cases leave some difficult recovery about way of counterclaim establish; on to actually where value difficult for work unjust enrichment for hand, leaves the other other result City prevailed if in its com- performed peculiar with the owner the structure plaint. problem attempting prove the value rules jurisdictions acting under Other may jus- of an structure. He unwanted recovery permitted ours have similar to tifiably no him feel that has value to quantum meruit without amendment for substantially because it is different Moreover, court pleadings.11 problem can what he for. The contracted position previously has taken presented form: As between another may pleadings be amended conform has the owner the contractor who has proof even after the trial occurred substantially perform, failed to who should long judgment has been entered12 proving the burden of the value provides grounds as the presented performance? recovery or defense asserted. for the Reason dictates that the must contractor conferred appear It thus show the value' the benefit contractor owner, may on the some per- rely could recover in this case for work theory damages protect artificial rule him.14 unjust formed under a enrich- parties ter view is there that while can be no -whom the court ac- cannot ** * recovery quire jurisdiction. the contract where sub- occurred, 54(c) provides breach can Civil stantial has there Alaska Rule part: quasi-contractual recovery Except party against benefits received. See of actual to a value whom a every judgment by default, at § 12 Williston Contracts 220- is entered 1473 (3d 1970) ; grant ed. 5A Corbin on Con- final shall the relief (1964) ; party tracts Restatement § to which at whose favor 357(3) (1932) ; entitled, party § rendered is even if Contracts McCor- Damages (1935). mick on at not demanded relief in his such pleadings. provide for re- 14.There are eases 11. See v. Matarese Moore-McCormack covery less Lines, Inc., rate 681, contractual 158 F.2d 170 A.L.R. performance. A close (2nd than 1946) ; substantial City, Cir. Kansas St. however, cases, shows examination of such Co., L. & C. R. Co. v. R. Alton reality performance (7th 1941) ; substantial F.2d 780 Cir. rel. State. ex attempt Gary an to soften harshness Electric v. Fund Fireman’s Indem. requiring early Co., re- the covery rule 67 N.M. 355 P.2d 84 A.L.R. complete per- (N.M.1960) ; Annot., there was unless 2d 1072 84 A.L.R. posi- sympathize (1962). We formance. 2d 1075 cases, feel tion taken in such but Sexton, 12. Gilbert v. 401 P.2d purposes doctrine to be served such (Alaska 1965) ; Deveau, 385 Harris by requiring established are better cf., 1963) (Alaska prove he has benefit contractor what Faltin, Merrill substantially he conferred where fails (Alaska 1967). changes unilaterally perform. his If he Although manner, appears performance he be some con- in a substantial there authority, expect given benefit of we think that the bet- to be flict cannot *11 466 by unhappy by the
Any
testified to
own-
could be more than
value
use
offset
understandably
points
may
injury.15
less than the
Professor Corbin
out that
er
making
the other
of a bad
does
actual benefit he receives. On
the best
situation
hand,
necessarily signify
has
not
the contractor
cost records and
benefit:
present expert
testimony
value
can
mere fact that the
is
defendant
provide
arriving
a
at
which will
basis
by
possession of the structure erected
which,
a fair
of the benefit or
at the
value
plaintiff
is
the defendant’s land
least,
very
provide
starting point
a
can
not in itself
to show that
sufficient
present
from which the owner can
rebuttal
any sense,
accepted it in
defendant has
testimony.
it,
or
has used
it. Fur-
benefited
However,
that,
thermore,
actually making
clear
test
his
of it
whatever
use
used,
prove
some evidence of value of the
does not
bene-
the benefit derived
presented.
fit must be
injury
Actual use does
therefrom is in excess
caus-
necessarily prove
a
plaintiff’s
net benefit has
ed
breach. Use of
structure, however,
been conferred
the owner. The value
is some
provisions
598,
(1887)
(contract
contractual
as to value which
Md.
A.
8
752
to
profit
figures.
parsonage
stone, per
also include
and overhead
cover
with certain
totally defeating
purpose
formance
15. See
Henning,
Turner
(D.C.
v.
262 F.
intended
637
because
the use of streaked
1920),
unsightly stone) ;
Cobe,
Cir.
where a builder constructed
v.
Gillis
177
flooring
porch.
584,
(1901)
Feeney
a
;
defective concrete
Mass.
N.E.
59
455
these,
tearing
Bardsley,
239,
The owner used
without
v.
66 N.J.Law
ment, by use and a matter of law. occurred as ance had duty had the contract Nordin Under incorrectly instruct- court trial City, as well While the by the proving acceptance acceptance, that there had Engineering. ed the by Philleo acceptance theory urged on a accep it did so is that such view the better While complain. The now Nordin cannot by determining what which inferred may be tance in the case at bar becomes question actual position person in the a reasonable by the with, theory as used under the it be whether been satisfied *14 misrepre- evidence of there was trial court a rea of fact whether question comes a any acceptance which invalidated City’s sentation place would sonable man performance with the been dissatisfied
this case.20 before, say cannot find we As we person has a not differ on this question of whether minds could reasonable reasonably jury per a issue.21 as to generally Conflicting question. acted case, acceptance was competing of inferences question presented this formance 227 instructions had been jury to the under of whether there questions submitted on the except 9,23 objected acceptance not acceptance which were and whether n There they by misrepresentation. the issue presented insofar as invalidated here, as it fore, asserts it was not error to sub Nordin hold that determination. we of sub question for determinat regard to the mit the issue to did with simply performance, that there stantial ion.24 677, Vogel, 683 : N.W.2d 23. No. reads as follows 20. v. 105 Instruction 9 Shimek accept- ; (NJD.1960) Generally, v. matter Eckert-Fair Co. on the of Constr. 629, (Tex. Flabiano, ance, provision in contract such as 632 a a 342 S.W.2d Haymore Levinson, us, ; Civ.App.1960) 8 makes the before which the one ; 307, (1958) judge 66, architect/engineer P.2d 309 the sole Utah 2d 328 acceptability Roofing quality Enterprise Co. of the & Sheet Metal 502, par- App. binding Corp., work, on the Ohio is valid and v. Howard Inv. 105 engineer (1957) ; Annot., 807, action and that 152 N.E.2d ties (1955). contract, approving the work A.L.R.2d 1119-1121 under such performance con- and manner Finch, 159, 161 21. Mallonee v. Cf. par- conclusive on the is final and tract 1966) Rogers, (Alaska ; Crawford v. fraud, collusion, the absence ties McCoy 1965) (Alaska prevents dis- concealment Co., P.2d 1009-1010 Alaska Brick covery part of the on the failure 1964). (Alaska comply with the contract contractor follows : terms, gross reads as
22.
Instruction No. 7
mistake as
or such
plaintiff
part
Nome has
imply
en-
of the
faith on the
bad
preponderance
proving
part
gineer
burden of
his
exercise
on
or failure
following
issues:
judgment.
of evidence
honest
instruction,
purposes
Nordin Construc-
That defendant
1.
this
For the
substantially
Company
you
did
tion
means a
fraud
are advised
comply
of the contract
misrepresentation
with the terms
or concealment
substantially perform the
and did
non-
a material
contractor
required
the terms
compliance
work
such
architect/engineer
contract.
misled in
acceptance
work
accepting
2. That
the work.
by plaintiff
question
pass
Nome or
auth-
of whether
do not
We
acceptance,
you
agents, if
find an
orized
correct state-
and 9 were
Instructions 7
collusion,
fraud,
was induced
ments of
law.
mistake,
concealment,
gross
all as
Annot.,
defined,
Nordin
A.L.R.
24. See
of defendant
hereafter
; Annot.,
architect/engineer
their
A.L.R.
or of
or of
(1937) ;
agents.
Dist. v.
Elliott Consol. School
authorized
IV
pre-trial
raised at the
conference or in the
pre-trial order concerning design failure.
speci
raises several other
There is no
reference
the examination
fications of error
its brief
which will
of the witnesses from
Engi
Philleo
briefly at
point.
discussed
neering at the trial concerning design failu
argues
that this case should be
only
re.25 The
witness to testify on this
for a new trial
the court
remanded
because
point
expert,
as an
Smith, testified
James
possible
suggesting
excluded evidence
de-
if
the construction had
properly
sign
system.
failure
the sewer and water
design
done the
would have had
strong
did
The court
exclude defendant’s exhibit
chance to succeed. There is no dispute as
rep-
“L” which was a letter from Nordin’s
to this testimony
presented
which was
resentative, Payne,
Engineering
to Philleo
City.26
This letter
called to
June
Since the
place
entire trial
took
engineers
attention
some possible
of.
theory,
another
attempt
with no
made in
problems concerning
design
sys-
of this
the examination of witnesses
get
tem.
question of design, and because
there
however,
pleadings,
do not contain
*15
party complaint
third
against
En-
Philleo
any
to design
reference
failure. There is
gineering, it
appear
that this issue
no defense asserted in the answer related
properly
was not
raised
failure;
below
design
any
has
nor was
issue
1967) ;
Morton,
Busboom,
F.Supp. 858,
(D.C.
Humber v.
426 S.W.2d
227
(Tex.1968) ; Rothberg
1964) City
Olenik,
Gjelle
554
v.
Iowa
v.
Osceola
(Vt.1970) ;
Co.,
262 A.2d
215,
461
v.
fald Constr.
225 Iowa
House
279 N.W.
Thornton,
428,
199,
(1938) ;
Rodgers,
76 Wash.2d
P.2d
457
590
Patten
430
(1966).]
Dunham,
(Tex.1968).
209
[See also
It
Vend
S.W.2d 479
is clear that
Obligation
or’s
toas
Fitness of Land for
the instructions
far
7
9 were
more
Purpose,
necessary,
a Particular
37 Minn.L.Rev.
than
108
restrictive
were
ad
(1952) ; Bearman,
Emptor
vantageous
in
Caveat
to Nordin. We find the more
Realty
Epon
legal authority
Sales of
persuasive
supports
Assaults
—Recent
Rule,
(1961) ;
acceptance
14 Vand.L.Rev. 541
view
ceptance
does not include ac
Haskell,
Implied
system.
The Case for an
War
of latent
in
defects
Quality
Property,
rant of
Appellant,
brief,
Sales of Real
in its
cites several
(1965) ; Robert,
early
53 Geo.L.J.
California, Washington,
633
Wisconsin
Unwary
Buyer:
Michigan
Case of the
Home
cases
hold that
which
Housing
It,
engineer
Merchant Did
52 Cornell
certificate of the architect or
(1967) ; Schwartz,
L.Q. 835
Defective
to all
in
conclusive as
defects
work-
Housing:
Emptor,
manship, patent
The Fall
otherwise,
of Caveat
or
in the ab-
(1970).]
33 ATLA L.J. 122-39
sence of fraud.
questionable
These cases are of
value
explanation
25. One
for the lack of assertion
today,
they
originally
based on
design
failure is the tactical
reason
emptor,
has,
the doctrine of caveat
which
attempting
to insure the favorable tes-
part, disappeared
for the most
timony
engineers
of Philleo En-
warranty
impact of modern
A
law.
some
gineering.
analogous
appears
what
in
situation
present
apply
would,
course,
hearsay
trend of tort
26. The
cases to
letter
be
warranty
implied
prove
if
doctrine of
of fitness
offered to
the facts asserted
argues
admissibility
to new
therein.
house construction on behalf of
its
buyer against
(and
Engineer
as
ing
the builder
notice to
even
Philleo
financing
California).
design
in
institution
believed
generally required
defects. Such no
Builders, Inc.,
given
Weeks v.
tice
Slavik
384 Mich.
to be
257,
(1970).
181 N.W.2d
owner or the architect
[See:
271
the contractor
Stewart,
1093,
Wawak v.
449
where the latter has
247
reason to believe the
Ark.
; Carpenter
plans
defective,
protect
S.W.2d 922
v. Don
are
in order to
ohoe,
liability
78,
399,
154 Colo.
the contractor
from
402
for deficien
(1964) ; Bethlahmy
Bechtel,
cies caused
91 Idaho
such defects. 17A C.J.S.
(1966) ; Schipper
515(b)
856;
Contracts
Allied
Con
v. Levitt &
Sons, Inc.,
States,
tractors v.
N.J.
United
381 F.2d
(1965) ; Waggoner
(1967).
A.2d
v. Midwest
Ct.Cl. 1057
Dev., Inc.,
(S.D.
ern
The
acceptance in-
question
whether
judgment had
After
the law
properly stated
struction
court,
entered in
Nordin and
the lower
concerning the
raised;
question
bonding company filed a motion for relief
fraud situations was
proof in
burden of
Alaska
Rule
judgment under
Civil
raised.
60(b).30
alleged for such re
grounds
permissible
catalog
these matters should
lief
a
rea
suggestion that
They
error under the doc-
sons stated under the rule.
included
plain
be considered as
Faltin,
mistake,
request
a
(1)
for relief because of
trine set forth Merrill
discovered,evidence,
fraud,
newly
has been consider-
(Alaska 1967),
(2)
(3)
ed,
equity,
any
other reason not
(5)
conclude
instructions
we
plainly
as to call for
four.
are not
erroneous
included
the other
court.
interference
this
request
alleged
The basis for
was the
discovery
after the
that the
only
found for the
had entered into a
with
the United
action,
City on its cause of
but also award
Department
Health
States
and Welfare
$190,000
ed
per
for extra work
system
to construct a
and sanitation
water
argues
formed. Nordin now
that this ver
200 low-cost
homes
require
so inconsistent
dict
attached to the
over which the case
granting of a new trial. We find no error
evidence, together
per-
arose. This
refusing
grant
new trial.28
Department
High-
mission to the
State
Marine,
v. Land’s
of Homer
End
ways to
and the
pave one street
main
(Alaska 1969),
court held
thereto,
were considered
tersections
that there would
waiver of
error
positive
proof
construction
inconsistency
as to
verdicts unless a
adequacy
project.
original
party
issue at the
raised such an
time
denial
The standard
of review
rule
adopted
returned. This
*17
60(b)
motion under Rule
is whether
expeditious
order to enable
correction of
denying
in
trial court
its discretion
abused
by
jury.29
error
to the
resubmission
the motion.31
permitted
Nordin cannot
be
now
to take
advantage of
probably
what was
a tactical
In considering the effect of
evidence,
part.
move on
By
silence it chose to ac-
the trial court noted that
the contractor
cept
verdict;
had
benefit
it
of the
continuously sought a change in venue,
may
28.
It
inconsistency
(3)
exists
(whether
fraud
heretofore denom-
between the theories of the claim and
extrinsic), misrepre-
inated intrinsic or
City
argues.
counterclaim.
sentation, or other misconduct of an ad-
party;
verse
29.
Washburn,
Cundiff v.
over expand system financing ditional for a view City argued and that the years some two before trial. Nordin in reach- as aid to premises an apparently grounds abandoned other Moreover, 60(b) the Rule its verdict.32 ing urged original in the pre- motion for relief from judge who heard motion solely and focused on fraud. trial court trial. The at the sided Nordin claims proves this evidence which were acutely problems of the aware system knew the had some positions by the pleadings and posed This, claimed, fraud, value. by his establishes shown This is parties. taken urged since this suit that the motion.33 hearing comments system has no value. the “new” evidence felt that The court to this is found answer contention suggested weighty quality was not legal throughout stance assumed presented at and that evidence by Nordin these proceedings forty the addition concerning trial perform- alleged a failure of substantial system the modification houses thing alleg- as ance. This is not the same import. of similar source was water ing if con- no value. Even does decision of that the are of the view We system, cede some limited benefit from the judge denying motion was the trial proof on Nordin show burden discretion, particularly in view his within City’s position such benefit. The Sedwick, 413 of our decision in Patrick v. throughout pleadings consistent (Alaska holding 1966), position permits argument. it to Such evidence, un- properly considered admit some limited benefit from must relate to facts which 60(b), der Rule per- urging substantially failure to while trial. If in existence at the time of inherent No fraud is form the contract. grounds for a new trial that facts it were City’s actions. to the trial have occurring subsequent prophecy, litigation an shown inaccurate facts, do find that the We thus never to an come end.34 asserted, addition fraud. establish We these ally obliged to comment feel In supplemental materials filed reports were dis engineering financial with a motion for reconsideration of the trial. No ex prior coverable trial court’s denial of for relief the motion planation is advanced for the failure to judgment, presented copies dis pre prior cover such evidence to the time engineering reports certain financial and We, therefore, deem system. sented herein. These re- the sewer and water 32.Stuart 8, view of The court denied this granted request but venue motion for the sewer and water filed and took issue with the October for third motion for decision rendered answer 1969, venue, did change on on the basis of the earlier parties be beneficial August 26, for this motion and 7, 1966, in Oles, change support a view of the of premises reach was City requested in second venue, his by Judge change unchanged. 1969, of his second venue because denying motion for affidavit of March motion for should be allowed subsequently stated and the decision portion of venue was premises. jurors. Sanders on The change of view of position original on motion change a view ruling, of court jury. A 34. 3 Barron & 33. See note was 59.08 the trial previous & Procedure position lief 1958) court concealment 1966). Sedwick, parties Anchorage, The from the “new evidence” not ; [3] could argument *18 stipulated 6A position of new additions judgment. discoverable 17, supra. 413 P.2d at 3784 considering Alaska. clearly § Moore properly Holtzoff, in this case. now inconsistent Federal Practice City (1966) made consider showed deliberate Federal Practice trial be and that motion to the (Wright Patrick The trial such (Alaska held Nordin for system before such rev. re- its in clearly newly-discovered evidence filing a reply claim brief oral presenting argument inapplicable.35 number case 1520. It also argues that the issue unjust enrichment VI was not appeal raised on in case number City appeal has as in its cross The 1290; for this reason it is claimed that we refusing erred in the trial court serted erred in discussing this opinion issue and costs. interest pre-judgment to award it filed in this case. agree. We Decem requested interest City The The record discloses case progress 4, 1965, the last date of ber was consolidated with cases 1290 and 1299 represented that time Nordin payment. At opinion by an order for which we entered under the contract been all work on order, This 1971. dated some June City’s of ac cause performed. Since three and one-half months after oral ar accrued, pre-judgment inter tion had then gument, was request entered at the of Nor- unless been awarded est should have din. order specifically provided that find, reason, such do not an some which we no further oral argument would be heard injustice. do Fairbanks award would an by us. arguments Nordin’s in case 1520 DeLima, Inc., 483 Inc. v. Morton Builders fully considered in reaching our de 1971); v. Phil (Alaska State cision, for we had a separate pre record (Alaska 1970). lips, 470 P.2d pared in case 1520 which consisted of a grant refused to costs to The trial court transcript of all oral arguments and all par- both City ground that since on papers written presented to the trial court. City their prevailed ties as to claims Additionally, we considered Nordin’s and that a costs. find not entitled to We was the City of Nome’s briefs. These did reading Rule too of Civil far restrictive depart from position taken in the trial simple balancing the re- 54(d).37 A court by party. each party makes it covery in favor of each In case number 1290 the record and City prevailing party that the clear briefs disclose that the issue unjust in this and should lawsuit38 enrichment was raised in the statement awarded costs. points appeal on in favor briefs of Nor- din and affirmed with Nome. The that it be modi- issue directions unjust enrichment as a fied to reflect the basis additional reversal award of page raised at 55 of terest and Nordin’s conformity costs in brief. with this This argument opinion. answered of Nome on pages 25-30 brief, of its RABINOWITZ, participating. J., not was treated further in reply brief of ON PETITION FOR REHEARING pages 8-11. In its petition for rehearing, Nordin as- It hereby ordered that the Petition for serts that it was denied the opportunity of Rehearing is denied. Montgomery Thomas, Ward v. $173,000.00 recovered counterclaim (Alaska 1964). for extra work. *19 attempted to introduce evidence at 54(d) provides part: 37. Civil Rule concerning trial revenue bonds express Except provision when there- system, but all such ex for is made either a statute objection posi cluded on of Nordin. The rules, these shall be state costs tion now taken Nordin is inconsistent prevailing allowed as of course to the previous position with its and our re party unless the court otherwise directs. view could be limited basis. Sons, Moore, See State, Merl F. Thomas Federal Practice 54.70 [4] Inc. (Alaska 1964) ; cf., (1966) ; P.2d Buza Columbia Knight, (Alaska Co., Mitchell v. Lumber (Alaska 1964). 1964). money paid 36. The recovered all ($1,351,335.60) to Nordin and Nordin