Title: Simek v. Rocky Mountain, Inc.

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Simek v. Rocky Mountain, Inc.1999 WY 65977 P.2d 687Case Number: 98-34Decided: 05/24/1999Supreme Court of Wyoming
 
RONALD L. SIMEK, Appellant 
(Plaintiff/Counter-Defendant),

v.

ROCKY MOUNTAIN, INC., 
d/b/a CHINOOK LOG HOMES, Appellee 
(Defendant/Counter-Claimant).

 

Appeal from the District 
Court of Park County The Honorable Hunter Patrick, 
Judge.

Steven Cranfill 
of Law Office of Steven Cranfill, P. C., Cody, Wyoming. Representing 
Appellant.

Stephen L. 
Simonton of Simonton & Simonton, Cody, Wyoming. Representing 
Appellee.

Before 
LEHMAN, C.J., and THOMAS, MACY, GOLDEN, and TAYLOR, * 
JJ.

* Retired November 2, 
1998.

TAYLOR, Justice, 
Retired.

[¶1]      At issue in this 
case is whether the terms of a building contract between appellant, Ronald L. 
Simek (Simek), and appellee, Rocky Mountain, Inc., d/b/a Chinook Log Homes 
(Chinook), required Simek to allow Chinook to perform remedial construction 
prior to bringing suit for breach of the warranty of good workmanship. The 
district court granted summary judgment in favor of Chinook, finding that 
Simek's refusal to allow Chinook to correct alleged construction deficiencies, 
when it was ready and willing to do so, precluded further action against Chinook 
pursuant to the terms of the contract. We affirm.

I. 
ISSUES

[¶2]      Simek, as 
appellant, presents a single issue for review:

1. The District 
Court erred in granting summary judgment on Appellant's first cause of action B 
breach of written contract.

Chinook, as 
appellee, raises three issues:

I. On appeal 
from summary judgment, may Appellant raise issues and theories not presented to 
the District Court?

II. Did Mr. 
Simek's affidavit present any genuine issues of material 
fact?

III. May Mr. 
Simek pursue a claim for contract damages after deliberately refusing to carry 
out the contract remedies spelled out by & 17 of the Construction 
Contract?

II. 
FACTS

[¶3]      In the winter of 
1993, Simek contacted Chinook to construct a large home on property Simek owned 
southwest of Cody. Building commenced in the spring of 1994, and approximately 
one month later, Chinook and Simek executed a written contract for the 
construction. Simek paid as the construction proceeded. By the end of 1994, 
$733,580.19 had been paid, and in January 1995, Chinook billed Simek $75,301.13 
for the work done in December.

[¶4]      Sometime in 
December 1994 or January 1995, Simek claims he became aware of alleged 
structural and non-structural defects in the construction of the home. As a 
result, Chinook was told to leave the project during the first part of January. 
In the latter part of January, Simek informed Chinook that he had turned the 
matter over to his attorneys and would arrange for an inspection of the 
property. On February 1, 1995, Chinook met with Simek and their respective 
attorneys to discuss the outstanding bills. After some negotiation, Simek paid 
the January invoice for work done in December.

[¶5]      The parties and 
their attorneys met again on February 15, at which time Chinook gave Simek a 
Notice of Completion and a final statement of $31,546.14 submitted for the work 
done during the first part of January. The parties agreed that terms of the 
contract requiring an inspection within fifteen days of completion would be 
waived. Subsequently, Simek had the property inspected by Beaudette Consulting 
Engineers, Inc., who submitted a preliminary report on March 19, 1995. Chinook 
responded in April, contesting some of the representations in the report, but 
agreeing to remedy several of the problems noted. Simek conducted another 
inspection on April 25, and on May 5, 1995, Simek's attorney notified Chinook 
that its limited response to the alleged defects placed them in breach of the 
warranty provision of the contract as well as breaching the obligation to build 
the house in a good and workmanlike manner. Simek stated he intended to arrange 
for a comprehensive structural analysis, preparation of a plan of remediation, 
and the employment of a competent builder of log homes to complete the 
project.

[¶6]      By May 30, 1995, 
Simek's engineer had agreed to a remedial program, and Chinook agreed to 
promptly do the work under the supervision of an engineer chosen by Simek at 
Chinook's cost. In June, however, Simek's attorneys notified Chinook that Simek 
refused to allow Chinook to do the repairs and that he had contracted with 
another builder to complete the home. Simek then filed a complaint in the 
district court in September 1995, alleging breach of written contract, breach of 
oral contract, and negligence.

[¶7]      Chinook denied 
any substantial construction defects and counterclaimed for the remaining 
invoice, alleging Simek failed to meet his duties under the contract. Chinook 
also maintained that Simek's exclusive remedy, pursuant to the contract, was to 
allow Chinook to repair any identified defects. Chinook claims it was prepared 
to do so, and such repairs would not exceed $11,000.00 B a minuscule portion of 
the one million dollars estimated for the cost of the 
home.

[¶8]      Chinook then 
filed a motion for judgment on the pleadings as to Simek's claim for breach of 
written contract, or in the alternative, for partial summary judgment. After a 
hearing on the motion, the district court granted partial summary judgment to 
Chinook, finding that the one-year warranty in the contract clearly required 
Simek to allow Chinook to perform the repairs prior to bringing suit. After the 
district court granted Simek's motion for an order allowing the partial summary 
judgment to become a final order under W.R.C.P. 54, this timely appeal 
followed.

III. STANDARD OF 
REVIEW

[¶9]      Summary judgment 
is appropriate when there are no material issues of fact and the moving party is 
entitled to judgment as a matter of law. We review the record in the light most 
favorable to the non-moving party, using the same factual materials and the same 
standards as the district court. State ex rel. Bayou Liquors, Inc. v. City of 
Casper, 906 P.2d 1046, 1048 (Wyo. 1995). Conclusory statements or mere opinions 
are insufficient, however, to satisfy an opposing party's burden to present 
evidence of a material issue of fact. Sanchez v. Life Care Centers of America, 
Inc., 855 P.2d 1256, 1257 (Wyo. 1993) (quoting Boehm v. Cody Country Chamber of 
Commerce, 748 P.2d 704, 710 (Wyo. 1987)). Moreover, we do not consider on appeal 
theories and points not raised in the district court, except for those issues 
which are jurisdictional or fundamental in nature. Bredthauer v. TSP, 864 P.2d 442, 446 (Wyo. 1993) (quoting Oatts v. Jorgenson, 821 P.2d 108, 111 (Wyo. 
1991)).

IV. 
DISCUSSION

[¶10]   Chinook's motion for partial 
summary judgment was based on paragraph 17 of the construction contract, which 
states:

17. WARRANTY. 
Contractor agrees to perform all work required of Contractor under this Contract 
in a good and workmanlike manner in accordance with the plans and specifications 
attached hereto. Said Warranty is in lieu of all other warranties, express or 
implied, including but not limited to warranties of fitness for particular 
purpose, merchantability and habitability. Contractor agrees for a period of one 
(1) year from the date of completion of the work to promptly correct, repair or 
replace, at Contractor's expense, any defect in the construction resulting from 
Contractor's defective workmanship. * * *

THIS WARRANTY IS 
IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED 
TO WARRANTIES OF FITNESS FOR PARTICULAR PURPOSE, MERCHANTABILITY AND 
HABITABILITY.

(Emphasis in 
original.) Chinook argued that the plain and unambiguous language of the 
contract required Simek to allow Chinook to repair all claimed defects occurring 
within one year of the completion of the project. Since Simek failed to do so, 
Chinook contended Simek was barred from bringing a claim on the 
contract.

[¶11]   In response, Simek alleged that the 
remedy of paragraph 17 was not exclusive, but was an additional remedy pursuant 
to paragraph 12 of the contract. The full text of paragraph 12 is as follows, 
with the portion relied upon by Simek emphasized:

12. CONTRACTOR'S 
RIGHT TO STOP WORK OR TERMINATE CONTRACT.

If the project 
should be stopped under Order of any Court or other public authority for a 
period of more than three (3) months through no act or fault of Contractor or of 
anyone employed by him or if the Owner should fail to issue any payment within 
the time provided herein or if Owner shall otherwise default under the terms and 
provisions hereof, then the Contractor may, upon three (3) days written notice 
to Owner, stop work or terminate this Contract and recover from the Owner 
payment for all work completed to date of termination and for any loss sustained 
upon any materials, labor, equipment, tools, construction equipment and 
machinery, including reasonable overhead expense, profit and damages arising out 
of Owner's default. In the event of any such default by Owner, Contractor shall 
be entitled to all costs and expenses incident to the enforcement of 
Contractor's rights hereunder including reasonable attorney's 
fees.

The duties and 
obligations imposed by the Contract Documents and the right and remedies 
available thereunder shall be in addition to and not a limitation of any duties, 
obligations, rights and remedies otherwise imposed or available by 
law.

No action or 
failure to act by the Owner or Contractor shall constitute a waiver of any right 
or duty afforded any of them under the Contract, nor shall any such action or 
failure to act constitute an approval of or acquiescence in any breach 
thereunder, except as may be specifically agreed in 
writing.

[¶12]   As a preliminary matter, we note 
that Simek did not argue to the district court that paragraph 17 was not 
triggered as of the time he tendered the list of alleged defects to Chinook. 
Neither did Simek argue the terms of the contract were ambiguous. Instead, the 
only issue presented to the district court was whether paragraph 12 allowed 
Simek to deny Chinook the opportunity to remedy any alleged defects, even though 
Chinook agreed to perform the work under the supervision of a professional 
engineer designated by Simek. We find that the unambiguous language of the 
contract did not afford Simek that luxury.

[¶13]   We have held that the parties' 
subsequent disagreement about the meaning of a contract does not establish an 
ambiguity. Examination Management Services, Inc. v. Kirschbaum, 927 P.2d 686, 
689 (Wyo. 1996) (quoting Moncrief v. Louisiana Land and Exploration Co., 861 P.2d 516, 524 (Wyo. 1993)). In reading a contract, our primary purpose is to 
determine the true intent and understanding of the parties at the time and place 
the contract was made. Examination Management Services, Inc., 927 P.2d  at 690 
(quoting Treemont, Inc. v. Hawley, 886 P.2d 589, 592 (Wyo. 1994)). We construe 
the contract as a whole, and strive to avoid a construction which renders a 
provision meaningless. Examination Management Services, Inc., 927 P.2d  at 690 
(quoting Moncrief, 861 P.2d at 523-24). "`Similarly, we strive to reconcile by 
reasonable interpretation any provisions which apparently conflict before 
adopting a construction which would nullify any provision[.]'" Examination 
Management Services, Inc., 927 P.2d  at 690 (quoting Moncrief, 861 P.2d at 
524).

[¶14]   The current dispute appears to stem 
from the contention that the district court held that paragraph 17 provided the 
exclusive remedy for Chinook's breach of the warranty of good workmanship. We do 
not read the district court's order to so hold. Instead, we find the district 
court correctly determined that the procedure by which Simek may claim breach of 
the warranty of good workmanship under paragraph 12 required any suit initiated 
after a notice of completion to be preceded by notice to Chinook of claimed 
defects, and an opportunity to promptly correct them pursuant to paragraph 
17.

[¶15]   In State Surety Co. v. Lamp Const. 
Co., 625 P.2d 184, 194 (Wyo. 1981), we reiterated the principle that it is 
necessary "for parties to follow the terms and conditions of contracts entered 
into by them." The language of paragraph 17 specifically addresses Chinook's 
obligation to correct any alleged defect identified within one year of the 
completion of the project. Thus, the contractual terms contained in the warranty 
of good workmanship provide that Chinook will breach the warranty only when 
Chinook refuses or fails to correct the listed defects. The importance of such a 
provision is easily discerned when viewed in light of Chinook's affidavit that 
the repairs could be accomplished for approximately $11,000.00, while Simek 
claims damages of over $100,000.00.

[¶16]   Were we to construe the plain 
language of the contract in the fashion urged by Simek, the provisions of 
paragraph 17 specifically identifying Chinook's control over its warranty of 
good workmanship would have no meaning. In this case, it is undisputed that 
Chinook gave Simek a notice of completion and Simek provided the list of alleged 
defects pursuant to paragraph 17 of the contract. It is also undisputed that 
Simek's expert prepared a list of remedial actions which Chinook agreed to 
perform in a timely manner. Simek's affidavit, the only evidence presented in 
opposition to Chinook's motion for partial summary judgment, provides no 
objective basis for Simek's refusal to allow Chinook to perform the repairs, 
especially in light of Chinook's voluntary agreement to proceed under the 
supervision of a professional engineer. Thus, the district court correctly found 
that, at the time Simek refused to allow Chinook to perform the remedial work, 
Chinook was not in default. Therefore, the order granting partial summary 
judgment in favor of Chinook on Simek's breach of contract claim is 
affirmed.

V. 
CONCLUSION

[¶17]   The contract between Simek and 
Chinook unambiguously provided that Chinook would have the opportunity to 
correct any alleged defects in the project prior to Simek bringing suit for a 
breach of the warranty of good workmanship after receiving notice of completion 
of the project. Simek refused to allow Chinook to follow the procedures set 
forth in the contract. Therefore, the district court's order awarding partial 
summary judgment on Simek's claim for breach of contract is affirmed.