Plaintiff Shepherd Components (Shepherd) commenced this action after a wall of its cinder block building collapsed during excavation work performed on adjacent property for a city sewer project. Defendant Brice Petrides — Donohue & Associates, Inc. (Brice), an engineering firm, prepared the plans and specifications for the project. Codefendant Peterson Contractors, Inc. (Peterson), was the contractor that performed the excavation work for the sewer project. A jury returned special verdicts allocating fault and determining Shepherd’s damages. In accordance with the verdicts, the trial court entered a judgment against Brice for thirty percent of the actual damages and a judgment against Peterson for the remaining seventy percent of Shepherd’s actual damages and for punitive damages. The court allocated seventy-five percent of the award for punitive damages, less attorney fees, to the civil reparation fund pursuant to Iowa Code section 668A.l(2)(b) (1989). Both defendants appeal, and plaintiff cross-appeals.
The original plans and specifications did not detail any protective methods for Peterson to use in excavating the adjoining property. Peterson engaged an engineer, not named in the suit, to prepare shop drawings of a system to retain the earth along the excavation route adjacent to Shepherd’s building. These drawings were approved by Brice and required that sheet piling (sheeting) be driven along the excavation route with the use of accompanying back-filling as the sewer pipe was being laid. The drawings did not provide for the excavation of earth between Shepherd’s building and the sheeting.
During the excavation work, Peterson departed from the drawings by removing earth immediately adjacent to Shepherd’s building and below the footings before actually installing the sheeting. Peterson maintained that the earth immediately adjacent to Shepherd’s building was removed to lessen the vibration caused by the hammer used to drive the sheeting into the frozen earth. This preliminary excavation was performed on a Friday afternoon. The following Monday, a Peterson employee noticed that a corner of Shepherd’s building was cracked and deteriorating. Work was then halted. Brice and Shepherd were notified. After a series of meetings between the parties, Peterson elected to finish its work and repair Shepherd’s building when the project was completed. Peterson instructed Shepherd not to use the damaged corner while the sewer project was being completed and to place scaffolding inside the building. Shepherd maintained that this temporary corrective measure compounded the problem because its employees could not operate equipment. When the sheeting was removed three months later, the entire damaged wall collapsed.
Peterson conceded its negligence when the damage occurred, but denied the amount of monetary damages claimed by Shepherd. Brice denied any responsibility for damages to the building. The jury separately determined Shepherd’s monetary damages for repairing the building, fixed overhead expenses, and loss of good will. The jury found that Shepherd was not at fault for failing to mitigate damages and did not sustain any loss of profits. The jury also found that Peterson’s wrongful conduct was not directed specifically at Shepherd.
On appeal, Brice claims that the trial court erred in submitting the issue of its negligence to the jury because it neither controlled nor supervised the excavation work performed adjacent to plaintiff’s building. Brice also raises issues concerning the admission of expert testimony and the award of damages to Shepherd.
Peterson challenges the amount of damages awarded. It also attacks the jury instructions on punitive damages and overhead expenses. Finally, Peterson claims the trial court should not have submitted the issue of damages for loss of good will.
On cross-appeal, Shepherd maintains that the award of punitive damages is the property of Shepherd and that any distribution to the civil reparation fund pursuant to Iowa Code chapter 668A is unconstitutional.
*615 I. Negligence of construction engineer. Plaintiff’s action against Brice alleged negligence in the design of the sewer project and in providing consultation services to Peterson. At the close of the evidence, Brice moved for a directed verdict, claiming that plaintiff did not present sufficient evidence of faulty design of the project. Even though the trial court overruled the motion, its jury instructions addressed only issues concerning the construction phase of the project and did not address the issue of faulty project design. Brice also asserted that it did not owe plaintiff a duty under its contractual obligations with the City. The court concluded that Brice owed a duty to plaintiff as a matter of law in providing construction review and related services. Consequently, the court instructed the jury to determine whether Brice was negligent in the performance of these services by failing to stop the construction work, allowing Peterson to continue working after discovery of the damage without acting to prevent further damages, and failing to exercise the ordinary skill of an engineer. On appeal, Brice maintains that the trial court erred in concluding that it owed plaintiff a duty.
We are guided by certain principles in considering Brice’s contentions. When a contract imposes a duty upon a party, the neglect of that duty is a tort founded on contract.
Chrischilles v. Griswold,
The issue in this case is whether the trial court correctly determined that Brice, in its role as a construction reviewer, owed a duty to protect plaintiff from harm. An examination of the contracts that the City entered with defendants Brice and Peterson is helpful.
The contract between the City and Brice reveals that Brice’s duties were limited during the construction phase of the project. One provision generally describes the engineer’s duties during the construction phase as follows:
The ENGINEER shall:
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Make periodic visits to the site of the construction to observe the progress and quality of the construction work and to determine, in general, if the results of the construction work are in accordance with the Drawings and the Specifications. On the basis of his on-site observations as an ENGINEER, he shall endeavor to guard the OWNER against apparent defects and deficiencies in the permanent work constructed by the Contractor but does not guarantee the performance of the Contractor ... The ENGINEER is not responsible for construction means, methods, techniques, sequences or procedures, time of performance, programs, or for any safety precautions in connection with the construction work. The ENGINEER is not responsible for the Contractor’s failure to execute the work in accordance with the Construction Contract.
Under this paragraph, Brice was responsible for preventing any apparent defects or deficiencies in Peterson’s completed work. However, the purpose of this responsibility was to protect the City rather than an adjoining landowner such as plaintiff.
Another provision of the contract limited the engineer’s responsibility for construction review services as follows:
The ENGINEER has not been retained or compensated to provide design and construction review services relating to the Contractor’s safety precautions or to means, methods, techniques, sequences, or procedures required for the Contractor to perform his work but not relating *616 to the final or completed structure; omitted services include but are not limited to shoring, scaffolding, underpinning, temporary retainment of excavations and any erection methods and temporary bracing.
Another provision of the contract provided that the purpose of on-site review services was not to protect the public from unreasonable work methods and means, but to protect the City by assuring the quality of work performed. This provision provides as follows:
By means of the more extensive on-site observations of the work in progress, the ENGINEER will endeavor to provide further protection for the OWNER against defects and deficiencies in the Contractor’s work, but the furnishing of such services shall not include construction review of the Contractor’s construction means, methods, techniques, sequences or procedures, or of any safety precautions and programs in connection with the work, and the ENGINEER shall not be responsible for the Contractor’s failure to carry out the work in accordance with the Construction Contract.
The respective duties of the participants in the sewer project can also be gleaned from the contract and bid specifications between Peterson and the City. Under the contract between Peterson and the City, Peterson was required to shore up, secure, and protect all foundations adjacent to the areas of excavation. As noted previously, Peterson engaged an independent engineering firm to determine methods of construction that would provide for safe excavation adjacent to plaintiff’s building. This contract placed the entire responsibility for avoiding damage to adjoining property owners on Peterson. If such damages occurred, Peterson agreed to indemnify the City.
The contracts between the City and Brice and Peterson were prepared using forms supplied by Brice. We have previously held that a similar professional, an architect, cannot avoid a duty by making his own rules establishing when he can be held responsible in a contract with a third party.
McCarthy v. J.P. Cullen & Son Corp.,
A general rule applicable to this case is that an engineer does not, by reason of its duty to inspect the construction site, assume responsibility for either the day-today construction methods utilized by the contractor or the contractor’s negligence.
Walker v. Wittenberg, Delony & Davidson, Inc.,
Plaintiff claims that Brice was at the construction site and should have stopped the work. The fact that Brice visited the site periodically does not change the fact that Brice had no legal duty to interfere with Peterson’s judgment on which construction procedures to utilize.
Vonasek v.
*617
Hirsch & Stevens, Inc.,
Plaintiff also urges that Brice assumed a duty by instructing Peterson’s employees on how to perform their job. In support of this contention, plaintiff offers an incident in which Peterson was told to “cease and desist” work that did not comply with the contract. This incident was a matter of quality control rather than supervision of construction work methods that affected adjoining property. Furthermore, this case was not presented to the jury on the theory that Brice assumed a duty to protect plaintiff. For these reasons we reject plaintiff’s contention.
Plaintiff also argues that its expert witness opined that under general standards of the engineering profession, Brice had authority to take action to stop the work. As previously noted, the function of the court is to determine the duties of the parties. General standards of the engineering profession may aid interpretation of ambiguous contractual terms. However, we believe that the duties of the parties were unambiguously stated in the contracts and that the expert’s testimony provides no aid in our interpretation of the contract.
In summary, our review of the responsibilities placed upon Brice in the contracts leads to our conclusion that Brice had neither responsibility for, nor control over, the construction procedures that were employed adjacent to plaintiff’s building and caused the damages. We conclude that Brice owed plaintiff no duty of care. Consequently, we hold that the trial court erred by not sustaining Brice’s motion for a directed verdict.
In view of our holding, we need not address Brice’s contention that the court erred by admitting certain testimony of a previously unidentified witness.
II. Damages. Peterson claims that errors were committed in both the award of punitive damages and in the inclusion of overhead expenses and good will as a part of plaintiff’s actual damages. We address these contentions in turn.
A. Punitive damages. The trial court submitted the issue of damages for jury consideration. The jury determined that Peterson’s conduct constituted willful and wanton disregard for the rights or safety of another and assessed punitive damages in the amount of $26,000 against Peterson.
Peterson contends that a punitive damage award is not appropriate in this case. Peterson conceded liability in this case, but urges that it had no responsibility for property damage to buildings caused by excavation work performed on adjoining land. Peterson also urges that its conduct did not amount to willful or reckless disregard of the rights of another. Furthermore, Peterson does not challenge the punitive damage award against it on the basis of its corporate status.
The allowance of an award of punitive damages is not a matter of right and rests with the factfinder.
Feeney v. Scott County,
Based on our review of the record, we conclude that the trial court did not err in submitting the issue of punitive damages to the jury. Peterson excavated immediately adjacent to plaintiff’s building and to a depth , below the footings without using the required sheeting. When Peterson discovered that the building had cracked, it continued the work in the same manner. We recognize that whether or not the *618 cracked corner of the building could have been repaired was in dispute. However, Peterson continued working despite three letters that Brice sent to Peterson expressing concerns over further deterioration of the wall. Plaintiff asked Peterson’s representative to repair the wall and was told that the wall could not be repaired. Peterson continued to use the same work methods and ignored plaintiff’s complaints. Peterson knew that the construction work was destroying the wall and depriving plaintiff of use of the building. Despite this knowledge, Peterson continued the construction work which increased plaintiff’s problems and culminated in the entire collapse of the wall. Based on these findings, we conclude that the trial court’s decision to submit the matter' of punitive damages to the jury was proper.
B.
Overhead expenses.
On appeal, Peterson claims that the trial court erred in instructing the jury that it could award damages for certain overhead expenses. However, Peterson does not provide a citation to the record showing where error was preserved on this claim. Claims unsubstantiated in the record are not allowed on appeal.
Tratchel v. Essex Group, Inc.,
C. Good will. In a posttrial motion, Peterson claimed that no evidence substantiated an award of damages for loss of good will on the ground that plaintiff’s business was not profitable. Peterson contends that the trial court erred by denying this motion. Our examination of the motion for a directed verdict, and the objections to the instructions indicates that plaintiff’s claim was first raised in the post-trial motion. We do not decide the issue of error preservation because we reject Peterson’s claim on the merits. The trial court defined “good will” as “the value a business has acquired as a consequence of public patronage and encouragement because of its local position or reputation.” Even though profitability may be related to “good will,” the two do not necessarily depend upon each other. Thus, this contention has no merit.
III. Distribution of punitive damages. Plaintiff moved for a new trial pursuant to Iowa Rule of Civil Procedure 244. It alleged that the jury’s special verdict finding that the conduct of Peterson was not directed specifically at plaintiff was not supported by overwhelming evidence presented at trial. Iowa Code section 668A.l(l)(b) requires the jury to answer a special interrogatory indicating whether the defendant’s conduct was directed specifically at the claimant. The jury answered this question in the negative. Consequently, the trial court ordered that twenty-five percent of the punitive damage award be paid to plaintiff and the remaining seventy-five percent be paid into the civil reparation trust fund. Iowa Code § 668A.1(2)(6 ). Plaintiff asks that the trial court’s distribution of its punitive damage award be set aside and that it be awarded the entire amount of the punitive damage award.
An adverse verdict may be set aside and a new trial granted if the verdict is not sustained by sufficient evidence. Iowa R.Civ.P. 244(f). Additionally, the trial court has wide discretion in deciding whether a new trial should be granted.
Thomas Truck & Caster Co. v. Buffalo Caster & Wheel Corp.,
The trial court concluded that it could not rule as a matter of law that no evidence supported the jury’s finding that Peterson’s disregard for the rights of others was limited to plaintiff. We agree with the trial court’s ruling and further hold that the court did not abuse its discretion. The jury could have determined that defendant’s wrongful conduct was not specifically directed at plaintiff.
*619 Plaintiff also contends that the punitive damage award constitutes property entitled to constitutional protection under both the federal and Iowa constitutions. When enacted, Iowa Code section 668A.1 applied to all cases filed on or after July 1, 1986. 1986 Iowa Acts ch. 1211, § 47. Plaintiff argues that section 668A.1 constitutes a taking of property that violates the due process and equal protection clauses of the fourteenth amendment of the United States Constitution and article I, sections 6 and 9 of the Iowa constitution.
It has been held that a plaintiff has no vested right in a particular measure of damages.
American Bank & Trust Co. v. Community Hosp.,
We have stated that punitive damages are not allowed as a matter of right and are discretionary.
Berryhill v. Hatt,
IV. Summary. We hold that Brice did not owe a duty to protect plaintiff from damages caused by the construction procedures used by Peterson. Consequently, we reverse the judgment entered against Brice. We further hold that the trial court did not err in the award of actual damages. Peterson has admitted liability, therefore on remand the trial court shall enter judgment against Peterson for the full amount of actual damages.
We affirm the award and distribution of punitive damages. We assess two-thirds of the cost of this appeal against Peterson and one-third against Shepherd.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED ON THE APPEAL; AFFIRMED ON THE CROSS-APPEAL.