Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-88-01747/USCOURTS-ca10-88-01747-0/pdf.json

Nature of Suit Code: 820
Nature of Suit: Copyright
Cause of Action: 

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FI LED 

UNITED STATES COURT OF APPEALS United States Court of Appeals 

Tench Circuit 

TENTH CIRCUIT 

C. BENASSI ARCHITECTURE, INC., ) 

a Utah professional corporation,) 

vs. 

) 

Plaintiff-Appellant/) 

Cross-Appel lee, ) 

) 

No. 88-1729 

88-1747 

UG .. J 19 0 

:ROBERT L. HOECKER 

Clerk 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

) 

D.C. No. 86-C-233J (D. Utah) 

BECK STREET CONSTRUCTION CO., 

a Utah corporation, and 

PRECISION BILT SYSTEMS, 

DefendantsAppellees. 

and 

BEEHIVE STATE EMPLOYEES CREDIT ) 

UNION, a Utah corporation, ) 

) 

Defendant-Appellee/) 

Cross-Appellant. ) 

ORDER AND JUDGMENT* 

Before McKAY and EBEL, Circuit Judges, and WEST, District Judge. 

WEST, District Judge. 

** 

* . . . This order and Judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth circuit, except 

for purposes of establishing the doctrines of the law of the case, 

res judicata, or collateral estoppel. 10th Cir. R. 36.3. 

** The Honorable Lee R. West, United States District Judge for 

the Western District of Oklahoma, sitting by designation. 

Appellate Case: 88-1747 Document: 010110039615 Date Filed: 08/03/1990 Page: 1 
.. 

' This is an appeal and cross-appeal from the district court's 

judgment awarding plaintiff, C. Benassi Architecture, Inc., damages 

for breach of contract, dismissing plaintiff's copyright claim, and 

dismissing the counterclaims of defendant Beehive State Employees 

Credit Union (hereinafter "Beehive") for breach of contract. 

The parties have submitted their briefs and reply briefs, oral 

arguments were heard on March 5, 1990, and the issues are now ripe 

for review. 

The parties concede, and the Court agrees, that the copyright 

law issue in this case was resolved by the United States Supreme 

Court while this appeal was pending. Community for Creative Nonviolence v. Reid, 846 F.2d 1485 (C.A.D.C. 1988), aff'd, 109 s.ct. 

2166 (1989). Reid also effectively affirmed the judgment of the 

district court on plaintiff's copyright claims. The copyright 

issue is therefore no longer before this Court, and the Court will 

address only the contract issues raised by this appeal. 

The extensive factual history giving rise to this case is set 

out in detail in the district court's order, and will not be 

repeated here. c. Benassi Architecture, Inc. v. Beehive State 

Employees Credit Union, No. 86-C-0233J, slip op. (D. Utah Mar. 18, 

1988). Beehive urges that the district court erred in making the 

following findings: (1) that Benassi substantially complied with 

her obligations under her contract with Beehive, and was entitled 

to 90% of her architect's fee provided by the contract, (2) that 

Beehive rather than Benassi breached the contract, (3) that Beehive 

was not entitled to a credit of $3749 allegedly paid to Precision 

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Appellate Case: 88-1747 Document: 010110039615 Date Filed: 08/03/1990 Page: 2 
Bilt Systems (hereinafter "Precision") for drafting services, and 

(4) that Benassi was entitled to $3834 for "additional services" 

performed for Beehive. Because the disputed findings of the 

district court were findings of fact rather than of law, these 

findings must be upheld unless shown to be clearly erroneous. 

Guzman v. Pichirilo, 82 s.ct. 1095 (1962). 

discussed in the above listed order. 

The issues will be 

(1) Percentage Completion of Contract by Benassi 

The architectural contract between Benassi and Beehive divided 

Benassi's services into five phases, with the following percentages 

of the architect's compensation attributed to each: 

Phase 

(1) schematic design 

(2) design development 

(3) construction documents 

(4) bidding or negotiation 

(5) construction 

Percentage Compensation 

Total 

15% 

25% 

45% 

5% 

10% 

100% 

The contract required Benassi to provide Beehive statements of 

probable construction costs during each phase of the project. The 

evidence at trial was undisputed that in January, 1985, during the 

schematic design phase, Benassi submitted to Beehive her initial 

cost estimate of $195,280. On February 8, 1985, during the design 

development phase, Benassi provided an updated cost estimate of 

$239,597. The construction documents phase was unexpectedly 

interrupted in May, 1985, when the Salt Lake County Planning 

Division refused to approve Beehive's permit application for a flat 

roofed building. In mid-June, 1985, Beehive asked Benassi to 

redesign the building with a pitched rather than a flat roof. 

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Appellate Case: 88-1747 Document: 010110039615 Date Filed: 08/03/1990 Page: 3 
Because it was clear that the flat roofed building would not be 

constructed, no further cost estimate was given or requested for 

the flat roof building. Benassi prepared a scale model of the 

building with a sloped shed roof, and proceeded with the redesign 

of the building. By August 1, 1985, the construction drawings were 

completed to the point that construction could begin. In midAugust, 1985, at the conclusion of the construction documents 

phase, Benassi provided Beehive an updated cost estimate of the 

redesigned building of $380,741. 

Based on this evidence, the district court found that Benassi 

had substantially completed her contract through the bidding or 

negotiation phase, and was thus entitled to 90% of her fee. 

Although Beehive's expert witness testified that Benassi had 

omitted some portions of the design development and construction 

documents phases of the contract, he admitted that Benassi had 

produced construction drawings from which the building could be 

constructed, which is the final goal of an architect's work. Two 

other architects testified at trial that Benassi had indeed 

fulfilled her obligations under the contract. We find that there 

was substantial evidence at trial to support the district court's 

finding that Benassi had performed 90% of her contract, and was 

entitled to that percentage of her fee. The court's finding was 

not clearly erroneous, and is hereby affirmed. 

(2) Which Party Breached the Contract? 

Beehive disputes the district court's finding that it breached 

its architectural contract by bypassing Benassi and working 

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Appellate Case: 88-1747 Document: 010110039615 Date Filed: 08/03/1990 Page: 4 
directly with Precision and Beck Street Construction Co. to 

complete the building. Beehive argues that its direct 

communication with Precision was not a breach of its contract with 

Benassi because such direct communication was not expressly 

prohibited by the contract. 

We find, however, that there was adequate evidence at trial 

to support the Court's finding that Beehive constructively 

terminated the contract by preventing Benassi from performing her 

obligations as architect. Walter J. Wickens, Beehive's president, 

testified that he did not want Benassi to have anything to do with 

the building after August 23, 1985, and saw to it that she did not. 

(Tr. 430). Wickens further testified that after August 26, 1985, 

he had no further intention to use Benassi except to rubber-stamp 

the final plans for the county's construction permit. 1 (Tr. 421) . 

On August 26, 1985, Wickens directed Precision's draftsmen to 

redesign the building without consulting Benassi. (Tr.303). 

Wickens did not inform Benassi that he had directed Precision to 

change her design. (Tr. 420). When Precision expressed 

reservations about changing Benassi's plans without her consent, 

Beehive gave Precision a written hold-harmless agreement for its 

doing so. (Plaintiff's Exhibit 35). Thus, Beehive knew it and 

Precision were treading on thin legal ice by bypassing Benassi. 

Further evidence of Beehive's breach can be found from 

Beehive's failure to respond to Benassi's requests for information 

1

utah law, however, prohibits an architect from approving 

architectural plans whose preparation she did not supervise. 

U.C.A. § 58-3-2. (Tr. 356). 

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Appellate Case: 88-1747 Document: 010110039615 Date Filed: 08/03/1990 Page: 5 
she needed to perform her services. Benassi's September 17, 1985 

letter to Beehive requested a statement of funds available for the 

project, and her October 1, 1985 letter requested that Beehive 

clarify the purpose of its requested design changes, whether to 

reduce costs, or merely to alter the roof line. Beehive complied 

with neither of these requests. (Tr. 150, 156-157, 429). 

Beehive argues that, even if it breached the contract by 

bypassing Benassi, the trial court should have found that Benassi 

waived such breach by continuing her performance. The evidence, 

however, was that Benassi did not waive Beehive's breach. 

Benassi's September 20, 1985 offer to review the drawings revised 

by Precision was expressly made "as a courtesy only and with full 

reservation of our position that [you are] in present breach of the 

Agreement .... " (Plaintiff's Exhibit 46). Thus, Benassi did 

choose to terminate the contract due to Beehive's breach. 

The district court's finding that Beehive materially breached 

its contract with Benassi and thereby excused her from further 

performance was not clearly erroneous, and is hereby affirmed. 

(3) Drafting Services 

The district court found that the cost of Precision's drafting 

services was incorporated into the cost of the prefabricated 

building modules which it sold to Beehive. Beehive disputes this 

finding, contending that it paid Precision $3749 specifically for 

drafting services, and that Benassi was responsible under her 

contract for providing all drafting services. Beehive seeks a 

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Appellate Case: 88-1747 Document: 010110039615 Date Filed: 08/03/1990 Page: 6 
credit of $3749 against any amount otherwise due Benassi for breach 

of contract. 

The district court's finding is supported by the evidence at 

trial. Precision's witness at trial, Dave Howells, testified that 

Precision did not separately bill Beehive for drafting services, 

nor was the price charged Beehive for Precision's work increased 

because of the drafting. (Tr. 463, 464, 466). The record clearly 

supports the trial court's conclusion that the drafting services 

performed by Precision for Beehive were merely incidental to its 

primary service of furnishing the prefabricated building modules. 

Furthermore, if Beehive did incur any unanticipated expense for 

drafting services from Precision, such expense was incurred after 

Beehive breached its contract with Benassi by dealing directly with 

Precision. Clearly, Benassi would not be responsible for costs 

incurred by Beehive after the breach and as a result thereof. 

The district court's finding that Beehive is not entitled to 

a setoff against the judgment for drafting services is not 

erroneous, and is affirmed. 

(4) Additional Services 

The written contract between Beehive and Benassi did not 

expressly provide for payment for additional services provided by 

Benassi. However, between March and August, 1985, Benassi billed 

Beehive for various additional services, such as preparation for 

an appeal before the Salt Lake County Planning and Zoning 

Department, which Beehive paid. Based on this course of conduct, 

the district court found that Beehive impliedly agreed to reimburse 

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Appellate Case: 88-1747 Document: 010110039615 Date Filed: 08/03/1990 Page: 7 
Benassi for her additional services, notwithstanding the absence 

of specific contract authorization. Of the amounts Benassi billed 

for additional services, $3834 was not paid, and was awarded 

Benassi by the district court as damages. 

Under Utah law, it is well established that the parties to a 

written contract can modify the express terms of the contract by 

their course of dealing. Eie v. st. Benedict Hospital, 638 P.2d 

1190, 1195 (Utah 1981). Though arguably clear on its face, where 

the parties demonstrate by their actions that to them the contract 

meant something quite different, the intent of the parties will be 

enforced. Id., Bullfrog Marina, Inc. v. Lentz, 501 P.2d 266 (Utah 

1972). It is undisputed that the parties established a course of 

conduct whereby Beehive paid for additional services performed and 

billed by Benassi, without protest. The court's finding that the 

parties so modified their contract is well supported by both the 

facts and the law, and is hereby affirmed. 

(5) Conclusion 

Having carefully considered the record, the briefs, and the 

arguments of counsel, we find no error in the determinations of the 

district court. 

AFFIRMED. 

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