Tupelo Redevelopment Agency v. Gray Corp, et al.
| Docket Number: | 2006-CA-00218-SCT Linked Case(s): 2006-CA-00218-SCT |
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| Supreme Court: | Opinion Link Opinion Date: 10-18-2007 Opinion Author: CARLSON, J. Holding: ON DIRECT APPEAL: AFFIRMED; ON CROSS-APPEALS: AFFIRMED |
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| Additional Case Information: |
Topic: Contract - Extra work - Delay damages - Indemnification - Additur - Quantum meruit claim - Section 11-55-5 - Section 31-5-57 - Money paid into registry - M.R.A.P. 8 Judge(s) Concurring: SMITH, C.J., WALLER AND DIAZ, P.JJ., DICKINSON, RANDOLPH AND LAMAR, JJ. Non Participating Judge(s): EASLEY, J. Concurs in Result Only: GRAVES, J. Procedural History: Jury Trial Nature of the Case: CIVIL - CONTRACT |
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| Trial Court: |
Date of Trial Judgment: 01-12-2006 Appealed from: LEE COUNTY CIRCUIT COURT Judge: Thomas J. Gardner Disposition: After a jury trial, the court entered a judgment in favor of Gray Corporation against Tupelo Redevelopment Agency & a judgment in favor of Ragland and against Gray Corporation Case Number: CV02-133(G)L |
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| Party Name: | Attorney Name: | Brief(s) Available: | ||
| Appellant: | THE TUPELO REDEVELOPMENT AGENCY;
THE GRAY CORPORATION, INC.;
RONALD J. RAGLAND, SR. d/b/a RAGLAND
ENGINEERING AND RAGLAND CONSTRUCTION |
KEVIN B. SMITH
GUY W. MITCHELL
WILLIAM DANIEL PRESTAGE
WILLIAM G. ARMISTEAD, SR. |
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| Appellee: | THE GRAY CORPORATION, INC.; RONALD J. RAGLAND, SR. d/b/a RAGLAND ENGINEERING AND RAGLAND CONSTRUCTION; THE TUPELO REDEVELOPMENT AGENCY | B. SEAN AKINS THOMAS W. PREWITT KENNETH MARTIN HEARD, III | ||
| Appellee #2: | ||||
Synopsis provided by:  If you are interested in subscribing to the weekly synopses of all Mississippi Supreme Court and Court of Appeals hand downs please contact Tammy Upton in the MLI Press office. |
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| Topic: | Contract - Extra work - Delay damages - Indemnification - Additur - Quantum meruit claim - Section 11-55-5 - Section 31-5-57 - Money paid into registry - M.R.A.P. 8 |
| Summary of the Facts: | The Tupelo Redevelopment Agency entered into a contract with the Gray Corporation, Inc. for the construction of the Tupelo Fairgrounds Redevelopment Project. Gray was bonded by the Hartford Fire and Insurance Company. The original price contemplated by the contract was $1,725,347.08 and consisted of three components: Component A, water and sewer improvements; Component B, site work; and Component C, electrical, CATV, telephone and duct system. Allen & Hoshall provided the electrical plan and specifications to TRA for Component C of the Project. Jesco, Inc. was hired to serve as Construction Manager, and Tupelo Water & Light was hired to inspect and approve the Component C work. For the Component C work, Gray entered into an oral subcontract with Ronald Ragland, Sr., d/b/a Ragland Engineering and Ragland Construction, whereby Ragland agreed to perform some of the layout work contemplated by Gray’s contract with TRA, and to construct portions of the Project. After some problems with the plan were noticed, TRA, Jesco and Allen & Hoshall enlisted Ragland’s help to properly identify quantities of work and the scope of the Project requirements. Because these revisions required extra work on the part of Gray and Ragland, TRA, through its representative Jesco, promised Gray and Ragland a future change order. Gray obtained change order number 1, as required by the contract terms with TRA, for modifications to the electrical plan and specifications to Component C. Additionally, Gray requested and received two more change orders, number 2 and number 3. The three change orders brought about net additions of $283,209.20 to the original contract terms. Gray and Ragland proceeded with the contemplated work on the Project without receiving any additional change orders for any extra work or time delays associated with Component C. After Ragland completed the work and requested payment from Gray, which was never received, Ragland made a ore tenus motion to intervene in a suit which already had been filed. The court granted the motion to intervene, and Ragland filed an intervention complaint against Gray and Hartford. Gray filed a Motion for Leave to File Third-Party Complaint and to File Additional Claims Against the Third Party Defendant, TRA, which the court granted. Gray then filed its third-party complaint. Gray filed a Motion for Leave to File Amended Third-Party Complaint and To File Additional Claims Against the Third-Party Defendant, Allen & Hoshall Ltd. Architects Engineers, which the court denied. Ragland filed a Motion to Amend Intervention Complaint, alleging that discovery had been conducted, and, based on that discovery, Ragland desired to seek punitive damages against Gray and Hartford. The court denied the motion. Ragland filed another Motion to Amend Intervention Complaint based on Ragland’s assertion that the amount of damages sought should be increased from $534,454.11 to $1,339,658.63. TRA filed a Motion to Enforce Partial Release and Settlement Agreement detailing an agreement between TRA and Gray, in which Gray released TRA from any further liability except the exact claim for equitable adjustment amounting to $771,912.91, which fixed the claimed amount for equitable adjustment relating to Ragland at $458,178.00. TRA thus claimed that if Gray was found liable to Ragland for an amount exceeding $458,178.00, TRA was not liable for the increased amount. TRA also moved for summary judgment on the ground that Gray had failed to come forward with elemental proof to sustain claims for equitable adjustment to the contract. The judge granted Ragland’s Motion to Amend Intervention Complaint, and Ragland filed its Amended Intervention Complaint against Gray and Hartford. Following the trial, the jury returned verdicts based on special interrogatories submitted by the trial judge. Specifically, the jury rendered a verdict in favor of Ragland and against Gray in the amount of $850,551.32, of which amount Gray and Hartford were found jointly and severally liable for $619,173.32. The jury also rendered a verdict for Gray against TRA in the amount of $258,118.00. The court later entered an order reflecting that TRA had paid its judgment in favor of Gray in the amount of $258,118 plus all incurred interest. This payment thus satisfied and cancelled the judgment entered against TRA and in favor of Gray. In addition, satisfaction of the judgment by TRA removed the lien upon all of TRA’s property, real, personal or mixed. Ragland and Hartford entered into a Full, Final, Absolute Release and Assignment whereby Hartford paid Ragland $475,000 and assigned all of its rights in and to the funds deposited with the Court by TRA. That same day, Ragland filed a Motion to Require the Circuit Clerk To Pay Ragland the Funds TRA Paid into Court. TRA filed a Motion to Stay Execution of Money Judgment. The court dismissed Hartford with prejudice as it had fully paid its judgment. Additionally, the circuit court entered an Amended Final Judgment which reflected the circuit court’s decision concerning the amount of attorneys’ fees to be assessed against Gray and Hartford, as well as fixing the date from which post judgment interest would begin to run. As a result, Ragland’s judgment against Gray was increased to $1,216,605.20, of which $892,676.00 was the joint and several obligation of Gray and Hartford. The court denied Ragland’s Motion to Require the Circuit Clerk to Pay Ragland the Funds TRA Paid into Court and granted TRA’s Motion to Stay Execution, allowing TRA to satisfy the requirement of posting a bond equal to 125% of the judgment amount by the posting of an appeal bond equal to 25% of said amount. TRA appeals, and Gray and Ragland cross-appeal. |
| Summary of Opinion Analysis: | Issue 1: Directed verdict TRA argues that its motion for directed verdict should have been granted, because Gray has not carried its legal burden of showing that TRA waived its contractual rights to require change orders for alleged extra work; TRA has statutory and common-law safeguards which limit its liability; the circuit court erred in allowing the jury to determine whether Gray was entitled to delay damages; and TRA should not be obligated to indemnify Gray. While TRA’s contract with Gray requires a written change order for compensation of extra work, TRA may have waived this contractual provision by a persistent pattern of conduct. Such a determination depended upon the facts and the parties’ pattern of conduct, and was a proper jury question. Although it is apparent that the contract between TRA and Gray required a written change order before Gray could obtain compensation for extra work, TRA waived that particular contract provision. TRA’s persistent pattern of conduct of issuing change orders after extra work had begun, Gray’s reasonable belief that a final change order would be issued covering all extra work, and Brister’s representations (as TRA’s agent), taken as a whole, clearly waived the contract provisions requiring a written change order. TRA argues that the circuit court erred in denying TRA’s motion for directed verdict by allowing the jury to consider Gray’s claim for delay damages. Mississippi law recognizes four exceptions to enforcing a no-damage-for-delay clause. Since determining whether an exception applies is clearly a fact question for the jury, the circuit court was correct in denying TRA’s motion for directed verdict. TRA argues that the trial court erred in denying its directed verdict as to Gray’s claim for indemnification. The circuit court did not err by denying TRA’s motion for directed verdict on the issue of indemnification. Gray and TRA have different theories as to who is responsible for Ragland’s damages; thus, the evidence the jury heard was of such quality and weight that reasonable and fair-minded jurors could have reached different conclusions. Issue 2: Additur Gray argues the circuit court erred in not granting an additur as to Gray’s judgment against TRA. However, Gray fails to cite any authority which demonstrates that it is entitled to an additur, thus precluding the Court from considering the specific claim on appeal. Issue 3: Quantum meruit claim Gray argues that the court erred in denying Gray’s motion for a JNOV on Ragland’s quantum meruit claim, because the claims under which Ragland sought recover, an express contract theory and a quantum meruit theory, are mutually exclusive. The doctrine of quantum meruit is applicable if the jury reasonably believed that Ragland performed additional work not contemplated by its oral contract with Gray, and that Gray accepted Ragland’s services and understood that Ragland desired to be compensated for said services. Ragland’s only form of recovery is based on quantum meruit for services which were performed outside the original, oral contract. Since it was reasonable for the jury to determine that Gray should be liable to Ragland under a legal theory of quantum meruit, the circuit court did not err in denying Gray’s motion for JNOV on the issue of whether Ragland was entitled to bring such a claim. Gray also argues that Ragland failed to prove its damages under the theory of quantum meruit with reasonable certainty. It is probable that a hypothetical reasonable juror, hearing all the testimony at trial, could conclude that Ragland proved its damage claim. Gray argues that the award of attorneys’ fees to Ragland should be reversed. Based on sections 11-55-5 and 31-5-57, the circuit court did not abuse its discretion in awarding attorneys’ fees to Ragland and against Gray and Hartford. Gray argues that the amount of attorneys’ fees awarded by the trial court was set without any meaningful analysis. A trial court’s award of attorneys’ fees will be on course for probable affirmance on appeal if the trial judge used as a starting point the number of hours reasonably expended on the litigation, multiplied by a reasonable hourly rate, after which the issue of attorneys’ fees must then be appropriately considered in light of Miss. R. Prof. Conduct 1.5(a) and the McKee factors. The record shows that the trial judge presided over a two-week trial in which numerous witnesses testified, and more than one hundred exhibits were received into evidence; that the trial judge had his recall of the evidence including that evidence revealing to the judge and jury the conduct of the participants in the Project. Furthermore, the trial judge had before him Ragland’s motion for assessment of attorneys’ fees, with the attached sworn affidavit of Ragland’s attorney, which motion and/or affidavit referred to sections 11-55-5 and 31-5-57 and the McKee factors. From the totality of the evidence the amount of attorneys’ fees assessed against Gray and Hartford and in favor of Ragland is justified. Gray argues that the court should have granted its motion for a new trial on damages or issued a remittitur. This issue basically is encompassed in Gray’s argument that the damages were not proved with reasonable certainty and lacks merit. Issue 4: Money paid into registry Ragland argues that, once TRA paid its judgment and then made an ore tenus motion to have the payment serve to have the judgment satisfied and canceled and the lien from its property removed, TRA had no further claim to the money. According to Ragland, since TRA had no further claim to the money, the money could not serve as security for an appeal. He argues that he suffered disproportionate and irreparable harm because he no longer had the procedural safeguards of a judgment lien against TRA’s property. M.R.A.P. 8 permits the trial court to grant a stay provided that the interests of the prevailing party are secure. In this case, Ragland’s interests are secure, although Ragland contends otherwise. TRA paid into the court’s registry one hundred percent of the judgment against it, plus all interest. In addition to one hundred percent of TRA’s judgment, TRA paid an additional twenty-five percent of the judgment to serve as a supersedeas bond. Therefore, Ragland is more protected than he would have been if TRA had simply posted a bond of one hundred twenty-five percent, because there is an actual money judgment in the court’s registry. Once Ragland obtained an interest in the judgment paid by TRA, Ragland did not have a immediate right to collect that judgment. Ragland, as the prevailing party, merely had a right to have its interest in that judgment protected until the appeal process was complete. |
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