I N TH E CO UR T OF A PP EALS S T AT E OF AR I Z ONA D I V I S I O N T WO
R IC H A R D E . L A M B E R T , L T D ., Pl ai nt i ff/A ppel l ee,
v. CI T Y OF T UC S ON DE P AR T M E NT OF PROCU REM ENT, D e f e n d a n t/A p p e llan t. )

) ) ) ) ) ) ) ) ) ) 2 C A
- C V 2009- 0022

DEPA RTM ENT A O P I N I O N

APPEAL FROM THE SUPERI OR CO UR T OF PI M A C OU NTY

C aus e N o. C 20073264 H onor abl e J ohn F. K el l y , J udge REV ERSED A ND REM AN DED
Du r a z z o & Ec k e l , P
. C. B yPat r i c E. D ur azz o and Eri c H aw ki ns
M e s c h , Cl a r k & Ro t h s c h i l d , P
. C. B yM el vi n C
. C ohen, Scot tH
. G an and Paul A
. L oucks T ucs on A t t or ney s forPl ai nt i ff/A ppel l ee
T ucs on A t t or ney s forD efe ndant/ A ppel l ant
H O W A R D , C hi ef J udge. D EC -4 2 009 

### F I L E D BY CLE RK

C OU RTOF A PP E A LS DI VIS ION TWO2

¶1 A p p e llan t C ityo f T u c so n a p p e a ls fro m th e su p e rio r c o u rt’s ju d g m e n t p a rtially
over tur ni ng t he C it y Pr ocur ement D i r ect or ’ s det er m i nat i on uphol di ng l i qui dat ed damages
a ss e ss e d a g a in st a p p e llee , R ich a rd E . L a m b e rt, L td . (h e re in a f ter R E L ). T h e C itya lso a p p e a ls t he s uper i orcour t ’ s or derg ran ti n g R E L ’ s r eques tforat t or neyfee s . B eca us e s ubs t ant i al
e v id e n c e su p p o rts th e D ire c to r’s d e c isio n , w e re v e rse th e su p e rio r c o u rt. F a cts and P roce dural H i s t ory ¶2 W e vi ew t he fa ct s i n t he l i ghtm os tfavor abl e t o uphol di ng t he admi ni s t r at i ve d e c is io n o f

th e C ity P ro c u re m e n t D ir e c to r. See W hi t eco O utdoorA dver
. v. C i t y of Tucs on , 193 A r i z. 314, ¶ 7, 972 P. 2d 647, 650 ( A pp. 1998) ( appel l at e courtbound byboar d’ s fac tual f in d in g s); cf

. P i ng i t ore v. Tow n of

C ave Cree k , 194 A r i z. 261, ¶ 18, 981 P. 2d 129, 132 ( A pp. 1 9 9 8 ) (w e a f

f irm a d m in istra tiv e d e c isio n if su p p o rte d b y c re d ib le e v id e n c e ); s ee al s o Speci al Fu n d D iv. v. Ind u s. C o m m ’n , 1 8 2 Ar i z . 3 4 1 , 3 4 6 , 8 9 7 P. 2 d 6 4 3 , 6 48 ( A p p . 1 9 9 4 )
. REL
co n tr ac ted w ith the C ityo f T u cso n to im p rov e the cit y -o w n ed N o rt h w est M an sfield P ark N ei ghbor hood C ent er . U ndert he t er m s of t he contr act , R E L w as t o i m pr ove a gym nas i um bui l di ng and add i r r i gat i on and l ands capi ng t o t he s por t s fi el ds s ur r oundi ng t he cent er . T he
c o n t r a c tr e q u i r e d R E L t o b e g i n w o r k b y J a n u a r y 5 , 2 0 0 4 , a n d t o w o r k “ p r o m p t l y, r e g u l a r l y, di l i gent l yand uni nt errupt edl y at s uch r at e of pr ogr es s as w i l l i ns ur e ful l compl et i on t her eof
w i t hi n t he t i m e s peci fi ed. ” T he cont r act fur t her pr ovi ded: “I f t he C ont r act ori s del ay ed on any por t i on of t he W or k for any r eas on w hat s oever , he s hal l expedi t i ous l ypr ocee d on ot herN e ith e r p a rt yc h a lle n g e d th is p ro c e d u re a n d w e d o n o t d e c id e its p ro p ri e ty. 1 3 P ort i ons of

t he W or k whi c h a r e no ta ff e c t e d b ys uc h d e l a y . ” A ft e rnu mer ou s e xt e ns i ons, R E L w as r equi r ed t o s ubs t ant i al l ycompl et e the pr oj ectbyFebruary3, 2005. ¶3 R E L compl et ed t he pr oj ecton D ece m ber 19, 2005, 319 day s aft ert he agr eed upon compl et i on dat e. Pur s uant t o t he t er m s of t he contr act , t he C i t yt hen as s es s ed R E L $500 p e rd a yi n l i q u i d a t e d d a ma g e s a n d r e t a i n e d t h e f i n a l $ 1 0 8 , 3 0 5
. 9 5 d u e o n t h e p r o j e c t . REL appea l ed thatdeci s i on t o t he C i t yC ont r actO ffi cer . T he C ont r act O ff i cerdet er m i ned t hat R E L w as r es pons i bl e for t he del ay i n compl et i on of t he pr oj ectand, ther efor e, found t hatt he C ityw a s e n tit led to a ss e ss liq u id a ted d a m a g e s u n d e r th e ter m s o f th e c o n tra c t. ¶4 Pur s uantt o t he t er m s of t he Tucson Ci t y Pr ocur ement C ode, R E L appea l ed the C o n tr a c t O f

f ic e r’ s d e c is io n to th e C ity D ir e c to r o f P ro c u re m e n t. See T ucs on C i t yPr oc. C ode § 2 8 -76 (“A p p ea ls fro m the de cisi o n s o f t h e C o n tr ac t O ff icer m ay b e m ad e t o the D ir ec tor” of Pr ocur ement . )
. T he D i r ect orappoi nt ed a hear i ng offi cer , w ho hel d an evi dent i aryhear i ng and ul t i m at el yagr eed w i t h t he C ont r actO ffi cert hatthe C i t yw as ent i tl ed to l i qui dat ed d a m a g e s . See T u c so n C ityP ro c . C o d e § 2 8 -1 1 3 (1 ) (d ire c to r sh a ll ap p o in t h e a rin g o f f ice r to deci de mat t er )
. T he hea r i ng offi cert hen s ubm i t t ed thi s r ecomm endat i on t o t he Pr ocur ement D ir e c to r, w h o a f

f ir m e d it. See Tu c s o n Ci t yP r oc . Cod e § 2 8
- 1 1 4 ( 2 ) ( d i r e c t o rma ya f f i r m,
m o d ifyo r reject reco m m en d ati o n o f h ea ri n g o ff icer). ¶5 R E L fi l ed a s peci al act i on i n s uper i orcou rt , chal l engi ng the D i r ect orof 1 Pr ocur ement ’ s deci s i on, r el y i ng upon a t er m of t he contr actgr ant i ng R E L a t i m e ext ens i on4

i n t he event of “unfor es eea bl e caus es bey ond t he contr ol and w i t houtt he fa ul tornegl i gence of t he C ont r act or ” such as “ac t s of G od” and “ac t s of t he C i t y . ” See als o T ucs on C i t yPr oc. C ode § 28- 117. B ot h t he C i t yand R E L fi l ed cr os s - m o ti o ns fors um m aryj udgm ent . T he
su p erior cou rt g ran ted R E L ’s m o ti o n in part, co n clud ing that the P roc u re m e n t D ir ec tor’s fac tu al fi ndi ngs w er e arbi t r ar y , capr i ci ous , and uns uppor t ed byt he fa ct s , r educe d t he l i qui dat ed damages t o $13, 500 and aw ar ded R E L i t s at t or neyfee s . T he C i t yappea l s fr om th is d e c is io n . See A
. R
. S
. § 1 2 -21 0 1 (B ). Evi de nt i ar y H e ar i ng ¶6 R e l y i ng up on R ule 4( f), A ri z. R
. P
. S pec. A ct i on s, t he C i t yprel i m in a rily
c o n t e n d s t h a tt h e s u p e r i o rc o u r te r r e d i n g r a n t i n g p a r t i a l s u mma r yj u d g me n t i n f a v o ro f REL
w i t houthol di ng an evi dent i aryhear i ng. R ul e 4( f) stat es t hati f “a tria b le is su e o f fa c t is
r ai s ed i n an ac t i on undert hi s R ul e, i ts hal l be tr i ed s ubj ectt o s peci al or der s conce r ni ng d is c o v e ry.” (E m p h a s is a d d e d .) ¶7 In g ra n tin g p a rtial s u m m a ryju d g m e n t in f a v o r o f R E L , the su p e rio r c o u rt d id
n o t r e s o l v e i s s u e s o f f a c t . Ra t h e r , t h e c o u r t r e s o l v e d l e g a l i s s u e s i n v o l v i ng w het her
s u b s ta n tia l e v id e n c e s u p p o rt e d th e C ity P ro c u re m e n t D ir e c to r’ s f in d in g s . See Hava su Hei ght s R anch and D ev. C or

p. v. D es er tV

al l ey W ood P r ods
. , I

nc. , 167 A r i z. 383, 387, 807 P
. 2 d 1 1 1 9 , 1 1 2 3 (A p p . 1 9 9 0 ) (w h ethe r su b stan ti al ev iden ce su p p o rt s ad m inistrati v e o ff icer’s f i n d i n g s i s q u e s t i o n o f

l a w)
. Ac c o r d i n g l y , n o e v i d e n t i a r yh e a r i n g wa s r e q u i r e d , a n d we
a d d re ss th e m e rits o f

th e C ity ’s a p p e a l.5 Sum m ar y Judgment ¶8 T he C it y arg ues t hatt he Pr ocur ement D i r ect or ’ s fi ndi ngs w er e s uppor t ed by
s ubs t ant i al evi dence and t her efor e cont ends t he super i or cour t err ed i n s et t i ng t hem asi de by gr ant i ng par t i al s um m ary j udgm ent i n R E L ’ s favor
. Sum m ary j udgm enti s appr opr i at e i f “no genui ne i s s ues of m at er i al di s put ed fac t s r emai n and the movi ng par t yi s ent i t l ed t o j udgm ent
as a m at t er of l aw . ” W

o e rth v . C ity o

f F la gsta ff , 167 A r i z. 412, 416, 808 P. 2d 297, 301 ( A pp. 1 9 9 0 ). W e re v ie w th e s u p e ri o r c o u rt ’s d e c is io n to g ra n t su m m a ry ju d g m e n t d e n o v o . L ib e rty Mu t. F ire In s. C o . v. Ma n d ile , 1 9 2 A ri z . 2 1 6 , 2 2 2 , 9 6 3 P .2 d 2 9 5 , 3 0 1 (A p p . 1 9 9 7 ). ¶9 W hen r evi ew i ng an adm i ni s t r at i ve deci s i on, t he super i orcour tm us tdet er m i ne
w hether t he adm i nis t rat i ve off i cer’ s “d et erm i nati on w as arbitraryand capri ci ou s or an abu se of di s cr et i on. ” R ob ert

son v. Superi or C ou rt , 136 A r i z. 440, 442, 666 P. 2d 540, 542 ( A pp. 1 9 8 3 ), ci t i ngA riz . R . P . S p e c . A c tio n s 3 (c ); c f. C ar et t o v. A r iz . D ep’ tof Trans p. , 192 A r i z. 297, ¶ 7, 965 P. 2d 31, 34 ( A pp. 1998)
. I n det er m i ni ng w hetheran admi ni s t r at i ve dec i s i on i s arbi t r aryorcapr i ci ous, the super i orcour t“maynotw ei gh t he evi dence on w hi ch the dec i s i o n was b a s e d ” a n d mus ta f f i r m i f t h e d e c i s i o n i s s u p p o r t e d b ys u b s t a n t i a l e v i d e n ce. Ar iz . De p ’ to f Pu b
. Sa f e t y v . Do wd , 117 A r i z. 423, 426, 429, 573 P. 2d 497, 500, 503 ( A pp. 1977)
. A nd t he s uper i orcour terr s w hen i ts ubs t i tut es i t s ow n j udgm entfort hatof t he
a d m in is tr a tiv e o f

f ic e r. S e e B la c k

v . C ity o f P h o e n ix , 157 A r i z. 93, 96, 754 P. 2d 1268, 1371 (A p p . 1 9 8 8 ); s ee al

s o Sm i th v. A r iz . D ep’ t of Trans p. , 146 A r i z. 430, 432, 706 P. 2d 756, 758 (A p p . 1 9 8 5 ).6

¶10 L i ke t he super i or cour t , t hi s cour t al s o det er m i nes w hethert he r ecor d cont ai ns
a n ye v id e n c e to s u p p o rt th e a d m in is tr a tiv e d e c is io n . Do wd , 117 A r i z. at426, 573 P. 2d at 5 0 0 ; s ee al

s o P ot t er v. A r iz . D ep’ t of T ra n s p. , 204 A r i z. 73, ¶ 8, 59 P. 3d 837, 840 ( A pp. 2 0 0 2 ). W e d o n o t re -w e ig h th e e v id e n c e ; w e m e re ly d e ter m in e if su b sta n tial e v id e n c e e x ists to s u p p o rt th e a d m in is tr a tiv e o f f ic e r’ s c o n c lu s io n s . Do wd , 117 A r i z. at 426, 429, 573 P. 2d at500, 503. I n det er m i ni ng w hethers ubs t ant i al evi dence exi s t s , “i ti s nece s s aryt o det er m i ne
w h e th e r th e [ a d m in istra tiv e ] d e c isio n so u g h t to b e re v iew e d is w ith o u t an ye v id e n c e to
s uppor t i t , ori s abs ol ut el ycont r aryt o uncontr adi ct ed and unc onfl i ct i ng evi dence upon w hi ch i tpurpor t s t o r es t . ” I

d. a t 4 2 6 , 5 7 3 P .2 d a t 5 0 0
. C ons t ruct i on D el ayL aw ¶11 P u rsua n t to the term s o f the co n tr ac t, R E L w as re q u ir ed to co m p let e the en ti re pr oj ectbya ce r t ai n dat e. B ut the co n t r actal s o pr ovi ded R E L w as ent i t l ed t o an ext ens i on of t i m e t o compl et e i t s w or k i f t he pr oj ectw as del ay ed bec aus e of “ unfo res eea bl e ca us es bey ond [R E L ’ s ] contr ol
. ” A l t hough t her e i s l i t t l e s ubs t ant i ve A ri zo na l aw on governm ent pr oj ectcons t ruct i o n del ay , “s t at e court s natur al l yl ook forgui dance i n publ i c contr actl aw t o t he fe der al court o f cl ai m s and the fe der al boar ds of contr actappea l s . ” N e w P u e b lo C o n str u c to rs , In c . v. S ta te , 1 4 4 A ri z . 9 5 , 1 0 1 , 6 9 6 P .2 d 1 8 5 , 1 9 1 (1 9 8 5 ). ¶12 Un d e rf

e d e r a l l a w, “ [ t ] h e t e r m ‘ d e l a y ’ i mp l i e s a s t o p p i n g o rh i n d r a n c e f o rs o me per i od. ” P aulH

ar dem an, I

nc. v. U ni t ed Stat es , 4 0 6 F. 2 d 1 3 5 7 , 1 3 6 1 ( Ct
. Cl
. 1 9 6 9 )
. REL,
as t he contr act orj us t i fy i ng unt i m el y p erf or m ance , had the bur den of pr ovi ng del ayand ofI n i t s ans w er i ng br i ef, R E L b ri ef lycont ends t hatcr i t i cal path anal y s i s i s “one of 2 s ever al m et hods ” i tcoul d have us ed t o s us t ai n i t s bur den of pr ovi ng excus abl e del ayas t o t he over al l compl et i on of t he cont r act . R E L t her efor e ar gues t hat i t w as notr equi r ed t o pr es ent a cr i t i cal path anal y s i s . T he onl yauthor i t yR E L ci t es fo r th is pr opos i t i on, how ever , i s t he s uper i or cour t ’ s s t at ement t hatt he courti n Y oungdal e & Sons rel i ed u po n “v ari ou s m et ho ds, in c lu d in g th e ‘c ritica l p a th a n a ly sis ’” to d e ter m in e w h e th e r a c o n tra c to r w a s e n tit led to d am ag es. B ec au se, as w e e x p lai n b elow , the rec o rd p rov ides su b stan ti al ev iden ce to su p p o rt t he D i r ect orof Pr ocur ement ’ s det er m i nat i on t hat R E L fai l ed t o s us t ai n i t s bur den of pr ovi ng excus abl e del ayas t o t he over al l compl et i on of t he pr oj ectbycr i t i cal path anal y s i s orany ot herm ethod, w e l eave foranotherdayt he dec i s i on of w hethercr i t i cal path anal y s i s i s t he o n ly m e t h o d o f

p r o v i n g e x c u s a b l e d e l a y. 7 p r o v i n g t h a t a n yd e la y s in p e rf o rm a n c e w e re e x c u s a b le
. CJ P Con t r a c t o rs , I

n c . v . Uni t ed St at es , 4 5 F e d . C l. 34 3 , 3 7 2 (1 9 9 9 ); c f
. Cl a r k v . Comp a n i a Gan a d e r a d e Can a n e a , S
. A. , 95 A r i z. 90, 94, 387 P. 2d 235, 238 ( 1963) ( br eac hi ng par t yi n act i on forbr eac h of contr acthas bur den of pr ovi ng “condi t i ons w hi ch w oul d excus e t hei r nonper for m ance ”)
. Pur s uantt o t he t er m s of t he contr act , a del ayi s excus abl e w hen i ti s due t o “unfor es eea bl e ca us es bey ond t he
c o n t r o l a n d wi t h o u t t h e f a u l t o r n e g l i g e n c e o f t h e Con t r a c t o r . ” See a l so C JP C on t ract ors , 4 5 F e d . C l. a t 3 7 2
. ¶13 A ccor di ng t o t he gene r al l aw of governm ent al contr act s , R E L al s o had t he bur den of pr ovi ng t hat “the excus abl e event caus ed a del ayt o t he o v e ra llcompl et i on of t he contr act . ” Id
. (em p h asis ad d ed ). T h is re q u ir e m e n t is co n sist en t w ith the c o n tr ac t’ s pr ovi s i ons r equi r i ng R E L t o compl et e the ent i r e pr oj ectata s peci fi ed t i m e and, i f one por t i on
o f th e p rojec t w a s d e layed , to c o n tin u e to w o rk o n o th e r p o rtio n s. A n e x c u sa b le d e lay af f e c ts t he over al l compl et i on of a pr oj ectw hen i taff ect s t he pr oj ect ’ s cr i t i cal path. Y oungdal e & 2 Sons C ons tr . C o. v. U ni t ed Stat es , 2 7 F ed
. C l. 5 1 6 , 5 5 0 (19 9 3 ). N ev erthe less, “‘[ a]nR E L al s o cl ai m ed, and t he P r ocur ement D i r ect or agr eed, t hat t he del ayw as caus ed 3 byt w o ot herfac t or s . B utbeca us e R E L does notar gue on appe al t hatthes e fa ct or s caus ed th e d e la yo r w e re e x c u s a b le , a n ya rg u m e n t c o n c e rn in g th e m is w a iv e d
. See A r i z. R
. C i v. A p p . P
. 1 3 (a), (b). 8 i nt e r r up t i o n i n o n e p h a s e o f t h e wo r k
. . . d o e s n o ta l wa y s r e s u l ti n a n i n c r e a s e i n t h e t i me
n e c e s s a ry f

o r t o ta l p e rf

o rm a n c e ’” o r o v e ra ll c o m p le tio n . B l i nder m an C ons t r . C o. v. U ni t ed St at es , 3 9 F e d . C l. 5 2 9 , 5 8 4 (1 9 9 7 ), quot i ng P aulH ar dem an , 4 0 6 F .2 d a t 1 3 6 1
. ¶14 T he Pr ocur ement D i r ect orcon cl uded thatR E L ’ s per for m ance had bee n del ay ed, i n par t , by( 1) pr obl ems i nvol vi ng t he r el ocat i on of a va l l eygut t erus ed i n t he pr oj ect , ( 2) a del ayi n es t abl i s hi ng per m anentpow eratt he pr oj ect w or k s i t e, and ( 3) an ar s on fi r e thatoccurr ed appr oxi m at el y t w o m ont hs aft er t he pr oj ectw as due t o be compl et ed. B ut 3 t he D i r ect orfur t herconcl uded t hatt he o v e ra llcompl et i on of t he w or k had notbeen de l ay ed byt hes e eve nt s , butr atherbyi nadequa t e s t aff i n g an d su p er vi s i on byR E L ’ s l ands capi ng
s u b c o n tr a c to r a n d o th e r c a u s e s th a t w e re w it h i n R E L ’s c o n tr o l. See C JP C on t ract ors , 45 Fed. C l
. at372. ¶15 T he C i t ycl ai m s t hatt he r ecor d cont ai ns s ubs t ant i al evi dence t o s uppor tt he Pr ocur ement D i r ect or ’ s concl us i on t hatR E L fai l ed t o s us t ai n i t s bur den of pr ovi ng t hatt he
ar s on fi r e, g u tt err el ocat i on, and perm anentpow erdel aycaus ed an e xcus abl e del ayi n t he
o v e r a l l c o m p l e t i o n o f

t h e p r o j e c t . W e a d d r e s s t h e e v i d e n c e r e l a t i n g t o e a c h d e l a y s e p a r a t e l y.9

A rson F ir e ¶16 T he C i t yfi r s tar gues t hats ubs t ant i al evide n ce w as pr es ent ed t o s uppor tt he P ro c u re m e n t D ire c to r’s d e ter m in a tio n th a t th e a rso n f ir e d id n o t d e lay R E L ’s o v e ra ll
c o m p le tio n o f

th e p roje c t. See C

JP C on t ract ors , 45 Fed. C l
. at372 ( cl ai m anthas bur den of pr ovi ng notonl yt hatdel ayw as excus abl e butal s o t hatdel aydel ay ed over al l compl et i on of p rojec t); cf

. C l ark , 9 5 A riz . at 9 4 , 3 8 7 P .2 d a t 2 3 8 (in a c a se in v o lv in g b r e a c h o f c o n tra c t, b re a c h in g p a rtyh a s b u rd e n o f p ro v in g “ c o n d iti o n s w h ich w o u ld e x c u se th e ir nonperf o rm an ce” )
. T he C i t yt her efor e cl ai m s t hatthe s uper i orcour terr ed i n s et t i ng as i de th e P ro c u re m e n t D ir e c to r’ s c o n c lu s io n a s “ u n ju s tif ie d .” ¶17 U nder t he t er m s of t he contr act and i t s var i ous amendm ent s , R E L w as r equi r ed t o compl et e the pr oj ect

— i ncl udi ng al l bui l di ng and i r r i gat i on w or k— by February3, 2005. I n M ar ch 2005, how ever , m or e t han one mont h aft erR E L w as s u p p o s ed t o have f i ni s hed
w or k, an ar s on fi r e and s ubs equentw at erdamage des t r oy ed the gym nasiu m fl oor . T he p arti es n eg o ti ated w h ethe r t h e d am ag e n ec essitat e d co m p let e re p lace m en t of the f loo r,
ev en tuallyag ree ing that itd id. D u e to diff iculti es o b tai n ing m aterial s to rep lace the f loo r,
as w el l as ot herdel ay s , R E L di d not r epl ace t he fl oor unt i l N ovember 22, 2005, m or e than ei ghtm ont hs aft ert he dat e of the fi r e. ¶18 B utt he fi nal por t i on of t he w or k t hatR E L compl et ed befor e t he C i t yacc ept ed t he pr oj ect w as t he l ands capi ng and i r r i gat i on s y s t em, nott he gym nas i um . A ccor di ng t o t he C i t y ’ s ar chi t ect , on t he dat e of t he fi r e, R E L s t i l l had notcompl et ed much of t he l ands capi ng10

and r oofi ng on t he pr oj ect . M or eover , even be for e the fi r e, R E L ’ s w or k on t he pr oj ectw as “al r eadys i x m ont hs behi nd s chedul e. ” R E L neede d t o compl et e a play g rou n d neart he g y mn a s i u m, a s we l l a s t o c o n s t ru c ts t a i r s , a wa l k wa y , a n d v a r i o u s wa l l s , a n d t o i n s t a l l a s u mp pum p. R E L al s o had not compl et ed ext ens i ve conc r et e, s tucco a nd as phal tw or k, as w el l as demol i t i on and var i ous bui l di ng pr oj ect s , al l of w hi ch w er e r equi r ed undert he t er m s of t he
c o n tr a c t. N o n e o f th is w o rk , a c c o rd in g to th e a rc h ite c t, w a s “ d e p e n d e n t o n re p la c in g th e . . . [ g y m n asiu m ] floo r or a n yo f th e f ir e d am ag e tha t occ u rred inside the b u il d in g .” N e v e rth e les s, R E L w a ited u n til a f ter it co m p lete d th e g y m n a siu m f lo o rin g to c o m p lete th is
s i gni fi cantamount of w or k, even though t es t i m onyw as pr es ent ed thati t co u ld ha ve “pr ogr es s e d o n war d ” wi t h t h e r e ma i n d e ro f th e p r o j e c td u r i n g t h e t i me i twas wai t i n g f or
m aterial s to rep lace the f loo r. ¶19 U ndert he t er m s of t he contr act , R E L w as obl i gat ed t o “pr ogr es s [] onw ar d”
w i t h t he r em ainder of t he pr oj ecti n t he eve ntthatone por t i on of t he pr oj ectw as del ay ed. T hatR E L fai l ed t o do t hi s cons t i tut es s ubs t ant i al evi dence f o r a rea s onabl e Pr ocur ement D ire c to r t o c o n c lu d e th a t th e a rso n f ire “ h a d n o im p a c t o n [ R E L ’s] a b ili tyto c o m p lete bui l di ng and s i t e w or k t hat w as i ncompl et e on t he dat e of t he fi r e. ” A ccor di ngl y , al t hough t he fi r e ca us ed a de l ayi n a por t i on of t he pr oj ect , s ubs t ant i al evi denc e su ppor t s t he Pr ocu rem en t D i r ect or ’ s deci s i on t hati tw as m er el ya “di s t r act i on” and ha d no eff ecton R E L ’s o v e ra llcompl et i on of t he pr oj ect ’ s obj ect i ves , w hi ch i ncl uded bui l di ng cons t ruct i on apartfr om t he gym nas i um as w el l as ext ens i ve i r r i gat i on and l ands capi ng. T he Pr ocur ement11

D i r ect orr eas onabl ycoul d have c oncl uded R E L s houl d have a ccompl i s hed s uch w or k dur i ng t he t i m e i t w as n eg ot i at i ng t he ext entof fl oorr epl ace m entand aw ai t i ng t he arr i val of t he f lo o r r e p la c e m e n t m a te ri a ls
. See D o wd , 117 A r i z. at426, 573 P. 2d at500 ( admi ni s t r at i ve
o ff icer, n o t sup erior co u rt , w eigh s ev iden ce ). ¶20 R E L claim s, h o w ev er, th at t h e P roc u rem en t D ir ec tor’s co n clus ion s w ere
u n s u p p o r t e d b e c a u s e t h e C i t y a d m i t t e d t h a tth e a r s o n f i r e c o n s t i tu t e d e x c u s a b l e d e l a y. In d e e d , the C ityC o n tra c t O f f ice r te st if

ie d th a t th e C ityh a d c o n sid e re d sto p p in g its
asse ssm en t of

li q u idated d am ag es a fter the arso n fire. B u t, alt h o u g h R E L is co rrect t h at fire can b e an ex cusable del ayun der t he t erm s of i t s contr act , t he C i t yw as st i l l enti t l ed to ass ess l i qui dat ed damages unl es s R E L s us t ai ned i t s bur den of pr ovi ng t hat t he fi r e had caus ed del ay t o t he o v e ra llc o m p le tio n o f th e p roje c t. See C

JP C on t ract ors , 45 Fed. C l
. at372. A nd, t he cit yev en tuallyrec o n side red w h ethe r t h e f ir e w as e x cu sab le de layb ec au se th e n o n -fire related p o rt ion s o f th e p rojec t w ere so fa r fro m co m p let ion
. T h e s u p erior co u rtthere fo re
err ed i n det er m i ni ng t hatt he Pr ocur ement D i rec t or ’ s concl us i ons w er e unj us t i fi ed and
uns uppor t ed byt he evi dence
. V al l eyG ut t erR el ocat i on ¶21 T he C i t yal s o cont ends t hat s ubs t ant i al evi dence w as pr es ent ed t o s uppor tt he P ro c u re m e n t D ire c to r’s c o n c lu si o n th a t th e v a lleyg u tter r e d e sig n d id n o t en tit le R E L to
e x c u s a b le d e la yin p e rf o rm a n c e . S e e Do wd , 117 A r i z. at426, 429, 573 P. 2d at500, 503 (sup erior co u rt m u st a ff irm ad m inistrati v e d ec isi o n if su p p o rt ed b ysu b stan ti al ev iden ce ). In12

i t s c h a l l e n g e of t h e Ci t y ’ s a s s e s s me n to f l i q u i d a t e d d a ma g e s f

o rl a t e p e r f

o r ma n c e , REL cl ai m ed thatt he i ncor r ectpl an fort he pl ace m ent of a gut t er at t he pr oj ectw or k s i t e r es ul t ed i n excus abl e del ayi n compl et i on of t he pr oj ect . T he P r ocur ement D i r ect ordi s agr eed a nd
co n clud ed that “[ w ]ha teve r de lay s o cc u rred b ec au se o f th e v all eyg u tt er reloc ati o n . . . w ere
m ino r i n sco p e, sho rtin d u ra tio n an d d id n o t aff ec t othe r co n stru cti o n ac ti v it ies t h at w ere h o ld in g u p su b sta n tial [ o r o v e ra ll] co m p letio n ” o f th e p rojec t. ¶22 T h e o rig in a l p rojec t d e sig n c a lled f o r b o o ste r p u m p s to b e p lac e d to o c lo se to t he gym nas i um bui l di ng. I tw as notunt i l M ar ch 2005, h ow ever , t hatR E L r eal i zed i tw as unabl e t o m ove t he boost er pum ps , beca us e t he proj ect ’ s or i gi nal des i gn cal l ed fora gut t er t o be pl ace d i n t he onl yot herar ea f eas i bl e t o i ns t al l t hem. R E L n ot i fi ed the C i t yof t he pr obl ems s ur r oundi ng t he gut t erl ocat i on , and the C i t y ’ s pr oj ectar chi t ectr edes i gned the gut t ert o be cons t ruct ed i n a new l ocat i on fur t herfr om t he boos t erpum p s i t e. D ue t o var i ous des i gn di ffi cul t i es , how ever , t he fi nal des i gn fort he new gut t er l ocat i on w as notcompl et ed
u n til Ju n e 2 0 0 5 , se v e ra l m o n th s a f ter th e p ro b lem a ro se . R E L c laim s th is d e lay re su lted in d e lay t o th e o v e ra ll p rojec t. ¶23 A C i t yi ns pect ort es t i fi ed, how ever , t hatt he gut ter re l ocat i on del ay ed the pr oj ect“[o] nl ydur i ng t he per i od of t i m e i n w hi ch the dec i s i on [about t he new des i gn and l ocat i o n ] was b e i n g ma d e . ” Th e i n s p e c t o r f u r t h e r s t a t e d t h a t a n y d e l a y h a d o n l y a “s l i ght i m pact ” on t he proj ect ’ s compl et i on. A nd w e have al r eadynot ed thati n M ar ch 2005, w hen R E L fi r s tbeca m e aw ar e of a pot ent i al d elay due t o t he gut t er ’ s i ni t i al l ocat i on, s i gni fi cant13

wor k r e ma i n e d t o b e c o mpl e t e d o n t h e p r o j e c t . Apa r tf

r o m t h e i r r i g a t i o n , whi c h REL cont ends w as del ay ed by the gut t er pl ace m ent , R E L al s o neede d t o compl et e s tuccoi ng and d e m o lit io n , as w e ll as c o n stru c t a p laygr o u n d a n d b u ild v a rio u s w a lls a n d o th e r a d d iti o n s to t he gym nas i um thathad not been del ay ed by di ffi cul t i es i n obt ai ni ng new fl oor i ng. U nder t he t er m s of t he cont r act r equi r i ng R E L t o “expe di t i ous l y pr ocee d” on por t i ons of t he pr oj ect unaff ect ed byanydel ay , R E L s houl d have c om pl et ed thi s w or k dur i ng t he per i od i n w hi ch i tw as aw ai t i ng t h e arc h it ect ’ s new des i gn fort he gut t erpl ace m ent , t her ebyoffs et t i ng any del aycaus ed byt he gut t err el ocat i on. ¶24 E vi dence w as al s o pr es ent ed fr om w hi ch the Pr ocur ement D i r ect orcoul d have concl u d e d t h a tREL p e r f o r me d i r r i g a t i o n a n d l a n d s c a p i n g wor k whi l e wai t i n g f o rt h e n ew g u tter d e sig n p lan s. R E L re q u e ste d p a ym e n t f o r $ 1 9 ,1 2 8 .0 0 w o rth o f

lan d sc a p in g w o rk it
c laim e d h a d b e e n c o m p lete d in A p ril 2 0 0 5 a n d $ 1 1 ,8 8 4 .0 0 w o rth o f lan d sc a p in g w o rk it cl ai m ed t o have com pl et ed i n M ar ch 2005. R E L ’ s M ay 2005 w or k s chedul e es t i m at ed that the irri g ati o n an d land sca p ing w o u ld b e c o m p let ed b ythe e n d o f Ju n e. U lt im ately , h o w ev er, i tt ook appr oxi m at el ys i x m ont hs for R E L t o fi ni s h t he proj ect . T he Pr ocur ement D i r ect or coul d have de term ined fr om t he r ecor d t hat , al t hough R E L w as w or ki ng on i r r i gat i on, t he i rr i gati on w as com plet ed m ore sl ow ly th a n u sual du e t o “ex cessi ve am ou nt[s ] of fai l ures”
e a c h tim e it w a s tes ted
. A c c o rd in g ly , a lth o u g h th e g u tter r e lo c a tio n d e layed c e rta in a sp e c ts
o f th e p rojec t, the h ea ri n g o ff icer co u ld r ea so n ab ly h av e fo u n d it d id no t d elay the p rojec t’ s
over al l compl et i on, i ncl udi ng por t i ons of R E L ’ s l ands capi ng w or k.14

¶25 R E L cont ends , how ever , t hatt he C i t yadmi t t ed t hatt he gut t err el ocat i on and
r edes i gn caus ed del ay . R E L t her efor e ar gues t hatt he del ayw as excu sab le b ecaus e i tw as
c a u s e d b yt h e Ci t y . But e v e n a s s u mi n g t h e Ci t y d i d c a u s e t h e g u t t e rr e l o c a t i o n d e l a y , REL d o e s n o t ex p lain h o w th e d e lay re su lted in a d e lay to th e o v e ra ll co m p letio n o f th e p rojec t. See C JP C on tract ors , 45 Fed. C l
. at372 ( cl ai m ant ’ s bur den t o pr ove no t onl yt hatdel ay
excus abl e butal s o t hatdel aycaus ed del ayi n over al l compl et i on of pr oj ect )
. A nd as w e have al r eadyexpl ai ned, t her e w as s ubs t ant i al evi dence i n t he r ecor d s uppor t i ng t he Pr ocur ement D ire c to r’s f

in d in g th a t an yd e lay ca u se d b yth e g u tter r e lo c a tio n d id n o t d e lay th e o v e ra ll pr oj ectcompl et i on beca us e i t “di d not aff ectot hercons t ruct i on act i vi t i es t hatw er e hol di ng
u p s u b s ta n tia l c o m p le tio n ” o f th e p roje c t. S e e Do wd , 117 A r i z. at 426, 429, 573 P. 2d at500, 5 0 3 (a d m in istra tiv e o f

f ice r, n o t s u p e rio r c o u rt, w e ig h s e v id e n c e ; su b sta n tial e v id e n c e e x ists
w hen anyevi dence s uppor t s adm i ni s t r at i ve dec i s i on)
. T he s uper i orcour terr ed i n s et t i ng
a sid e th e P ro c u re m e n t D ire c to r’s f in d in g s th a t th e g u tter r e lo c a tio n d id n o t d e lay th e o v e ra ll
c o m p letio n o f

th e p rojec t. Pow erD el ay ¶26 T he C i t y fi nal l yas s er t s t hats ubs t ant i al evi dence w as pr es ent ed t o s uppor tt he Pr ocur ement D ir ec tor’s concl us i on t hatt he l ack of per m anentpow erdi d notr es ul ti n an
excus abl e del ay . T he C i t yt her efor e ar gues t hat t he s uper i orcour terr ed i n s et t i ng as i de the P r o c u r e me n tDi r e c t o r ’ s c o n c l u s i o n a n d i n f i n d i n g t h a t “ REL wa s e n t i t l e d t o e x c u s a b l e t i me fort he del ayi n ext endi ng per m anen t p o w er to t he s i t e. ” S e e Do wd , 117 A r i z. at429, 57315

P. 2d at503 ( s uper i orcour tm us taff i r m admi ni s t r at i ve dec i s i on i f s uppor t ed bys ubs t ant i al
ev iden ce ). ¶27 U ndert he t erm s of t he contr act , R E L w as req u ir ed t o “make appl i cat i on for per m anent ut i l i t y s er vi ce fr om t he
. . . el ectr i c compan[y ]
. ” I n or der to o b tai n p er m anent pow er , R E L fi r s tneede d t o s ecur e and doc um entan ea s ement for T ucs on E l ectr i c Pow er C o m p a n y(T E P ). D u e to v a rio u s p ro b lem s in v o lv in g th a t ea se m e n t, R E L w a s n o t a b le to
s e c u r e p e r ma n e n tp o weru n t i l Fe b ru a r y1 1 , 2 0 0 5
. REL c o n t e n d s t h a tt h e Ci t ywas
r es pons i bl e fort he del ay i n obt ai ni ng per m anentpow erand al s o as s er t s t hi s del aydel ay ed t he ent i r e pr oj ect . T he Pr ocur ement di r ect or di s agr eed, how ever , and s t at ed the fol l ow i ng:

U nques t i onabl y , t her e w as a delayi n t he es t abl i s hm entof p erm an en t po w er to the s ite
. . . . T h e c ri ti ca l po int of [R E L ]’s cl ai m anal y s i s i s w hether , befor e the el ectr i cal s er vi ce w as ener gi zed, [R E L ] had any need for t hat pow er . W i t houta ca us al c o n n e c tio n , the f

a c t o f d e lay is irre lev a n t. A s th e e v id e n c e in th is hear i ng s how s , [R E L ] had no nee d forper m anentpow eri ns i de t h e b u i l d i n g u n t i l M a r c h 2 0 0 5 a n d t h e e v i d e n c e f u r t h e rs h o ws t hatt he i rri g at i on s ubcontr act orhad no nee d forper m anent po w erunt i l l at e 2005. A s s uch, t her e i s no caus al connec t i on b etw een t he del ayi n t he es t abl i s hm entof perm anentpow erby T E P at the s i t e as t o j us t i fyaddi t i onal day s for[R E L ] ’s compl et i on of t he cons t ruct i on ( t o avoi d l i qui dat ed dam ages ) or t o ext en d t he gene r al condi t i ons forw hi ch i tw oul d be compensa t ed. ¶28 Th e r e c o r d c o n t a i n s e v i d e n c e t h a tt h r o u g h o u tt h e p e r i o d d u r i ng w hi ch REL l acke d per m anent pow er by vi r tue of t he T E P de l ay , R E L s t i l l had acc es s t o t empora r ypow er
s our ces . A nd t es t i m ony w as pr es ent ed t hatR E L di d notneed pe r m anentpow ert o fi ni s h t he
m aj or i t yof t he pr oj ect . A ccor di ngl y , even i f, as R E L cont ends , t he C i t y w as r es pons i bl e for16

t he del ay i n per m anent pow er , t he Pr ocur ement D i r ect orr eas onabl ycoul d have c oncl uded t hatR E L s houl d have r el i ed upon t empora r ypow ers our ces t o compl et e any gy m nas i um and i r r i gat i on w or k r equi r i ng el ectr i ci t yr athert han w ai t i ng forper m anent p ow ert o be
e s ta b lis h e d
. C

f
. P aulH ar dem an , 4 0 6 F .2 d a t 1 3 6 1 (a lth o u g h c o n stru c tio n c o m p a n yu n a b le t o us e cr anes dur i ng per i od of construct i on and t her efor e i ncurr ed ext r a cos t s , “coi nci dence of [l ack of

cr anes ] and t he addi t i onal expens e does notnece s s ar i l yi m pl ya ca us al l i nk betw een them”)
. R E L admi t s t hati tw as abl e t o per for m i ni t i al t es t i ng of t he i r r i gat i on
s y s t em us i ng t empora r y pow er . A nd al t hough R E L cont ends t hat i tcoul d notcompl et e the ent i r e i r r i gat i on pr oj ectw i t houtper m anentpow er , per m anentpow erw as es t abl i s hed mont hs b e f o re R E L c o m p le te d th e la n d s c a p in g a n d ir ri g a tio n in D e c e m b e r 2 0 0 5
. ¶29 R E L cl ai m s , how ever , t hatt he l ac k o f per m anentpow erpr event ed i tfr om clos ing irri g ati o n tr en ch es be fo re th e i rri g ati o n sy stem h ad b ee n test ed
. R E L there fo re
as s er t s t hat “ [s]it e w or k, l ands capi ng and otherw or k coul d notcont i nue unt i l t he tr enche s
w er e cl os ed. ” B uteven a s s um i ng t hata l ack o f perm anentpow erdel ay ed s i t e w or k, lan d sc a p in g , an d o th e r p o rtio n s o f th e p rojec t, R E L h a s n o t ex p lain e d w h yth e re m a in in g six
w eeks of w or k t ook s even m ont hs t o compl et e. A s w e expl ai ned above , s ubs t ant i al evi dence
w as pr es ent ed t o s uppor tt he conc l us i on t hatany del ay i n obt ai ni ng per m anent pow erdi d not d e la yth e o v e ra ll c o m p le tio n o f th e p roje c t. S e e Do wd , 117 A r i z. at426, 429, 5 73 P. 2d at 500, 503 ( admi ni s t r at i ve off i cer , not s uper i or cour t , w ei ghs evi dence ; s ubs t ant i al evi dence
ex ist s w h en there is an yev iden ce to su p p o rtad m inistrati v e d ec isi o n ). T h e su p erior co u rt17

err ed i n s et t i ng as i de t he Pr ocur ement D i r ec tor’s d et er m i nat i on t hat , “[r ] egar dl es s of any el ectr i cal s er vi ce e s t abl i s hm entdel ay , [t he over al l compl et i on o f] this pr oj ectw as not de l a y e d b e c a us e of

” a nyde l a yi n o bt a i ni ng pe r mane ntpo w e rfr om TE P. ¶30 R E L al s o appea r s t o cont end, how ever , t hat t he pow erdel aycons t i tut ed
e x c u sa b le d e lay to it s o v e ra ll p e rf o rm a n c e b e c a u se th e C ityw a s n o t f o rth c o m in g a b o u t it s pr i ordi ffi cul t i es i n obt ai ni ng per m anentpow erfort he pr oj ectfr om T E P. B utt he contr act
s peci fi cal l yr equi r ed R E L t o obt ai n pow erand compens at ed i tfordoi ng s o. A nd even i f t he C ityh a d b e e n f

o rth c o m in g a b o u t it s d if f icu lti e s o b tai n in g p o w e r, p e rm a n e n t p o w e r still
w oul d have b e e n d e l a y e d
. Aga i n , s u b s t a n t i a l e v i d e n c e s u p p o r t s t h e c o n c l u s i o n t h a tREL coul d have c om pl et ed the maj or i t yof i t s buil d ing an d i r r i gat i on w or k w i t houtper m anent p o w e r; it ap p e a rs f

ro m th e re c o rd th a t R E L sim p ly lac k e d th e w o rk f o rc e a n d o rg a n iza tio n to d o s o in a tim e ly f

a s h io n . See E ast ern V

an gu ard Fo rex , L td. v. A riz. C o rp . C o m m ’n , 206 A r i z . 3 9 9 , ¶ 3 5 , 7 9 P. 3 d 8 6 , 9 6 ( App
. 2 0 0 3 ) ( s u b s t a n t i a l e v i d e n c e e x i s t s i f c o ncl us i on
su p p o rt e d b yre c o rd ). A n ylac k o f h o n e styo n th e p a rt o f

th e C ityd id n o t ca u se d e lay t o R E L ’ s over al l compl et i on of t he pr oj ect . T he s uper i orcour tt her efor e err ed i n s et t i ng as i de t he P rocurem ent D i rect or’ s fi nd i ng s. ¶31 O n appea l , R E L onl ydi s put es t he Pr ocur ement D i r ect or ’ s concl us i ons
con cerni ng t he arson fir e, gu t t er r el ocati on and perm anen tpo w er del ay . B e cause t hese
co n c lu s ion s w ere su p p o rt ed b ysu b stan ti al ev iden ce , w e c o n clud e tha t th e su p erior co u rt erred in se tt ing asid e the P roc u rem en t D ir ec tor’s find ing s an d in g ran ti n g p arti al su m m aryA ddi t i onal l y , beca us e w e conc l ude thats ubs t ant i al evi den ce s uppor t ed t he 4 Pr ocur ement D i rec tor’s det er m i nat i on t hatal l t hr ee de l ay s w er e i nexcus abl e, w e nee d not add res s the C i t y ’s con t enti on t hat R E L fai l ed to properly n o t i fyt he C i t yof an ydelay s, t her ebyw ai vi ng i t s cl ai m s t hatt he del ay s w er e exc us abl e. W e have not found any contr act pr ovi s i on i n t he re cor d pr ovi di ng for t he aw ar d of 5 a tto rn e yf

e e s a n d , the re f

o re , d o n o t co n sid e r th e C ity ’s r e q u e st u n d e r th e c o n tra c t.

18 j udgm entt o R E L
. W e t her efor e vacat e t he deci s i on of t he super i or cour tand r ei ns t at e that 4
o f th e C ityP roc u rem en t D ir ec tor. A t t orney F ees ¶32 T he C i t yal s o r eques t s t hatt hi s cour tvaca t e the su p er i orcour t ’ s aw ar d of att o rne yfe es to R E L
. In li g h t of o u r re v ersa l o f the su p erior co u rt ’s p arti al g ran t o f su m m ary j udgm ent , R E L i s no l ongert he pr evai l i ng par t yi n t hi s cas e, and i s , t herefo re, n otent i t l ed t o fee s pur s uantt o A
. R
. S. § 12- 341. 01( A ) ( pr evai l i ng par t y i n contr act cas e m aybe aw ar ded at t or neyfee s )
. C ons equent l y , w e vacat e the s uper i orcour t ’ s or deraw ar di ng at t or neyfee s t o REL. ¶33 R el y i ng on t he cont r act w i t h R E L and § 12- 341. 01, t he C i t yal s o r eques t s t hat t hi s cour taw ar d i t s at t orneyfee s i n s uper i orcour tand on appea l
. T he C i t yi s t he pr evai l i ng 5 p a rty , an d w e g ra n t it s re q u e st f o r a tto rn e y f

e e s o n a p p e a l an d in su p e rio r c o u rt, i n
c o m p lia n c e w ith R u le 2 1 , A ri z . R
. C iv . A p p . P
. See al s o W i nt erv. C oor , 144 A r i z. 56, 65, 695 P. 2d 1094, 1103 ( 1985) ( aw ar di ng at t or ney fee s t o pr evai l i ng par t yi n contr actdi s put e,
u p o n rev ersa l of

su p erior co u rto rde r).19 C oncl usi on ¶34 I n l i ghtof t he for egoi ng, w e vac at e the s uper i orcour t ’ s gr antof par t i al
s um m aryj udgm entand att or neyfee s in fa vorof R E L
. W e r ei ns t at e the dec i s i on of t he D ir ec tor o f P roc u rem en t an d aw ard the C ityit s att o rne yfe es in cu rred in the su p erior co u rt and on a p p ea l upon i t s compl i ance w i t h R ul e 21. Fi nal l y , w e r emand t hi s m at t ert o t he
s uper i orcour tforentr yof j udgm entand anyfur t her act i on i n acc or dance w i t h t hi s deci s i on.

____________________________________ J O SE PH W
. H O W A R D , C hi ef J udge

CO NC UR RI NG:

____________________________________ PH I L I P G
. E SPIN O SA , Pr es i di ng J udge

____________________________________ J A M E S A
. SO T O , J udge*

*A j udge of the Super i orC our t of A r i zona a ut hor i zed a nd as s i gned t o s i tas a j udge on the C o u rt o f A p p e a ls, D iv isio n T w o , p u rsu a n t to th e A riz o n a S u p re m e C o u rt O rd e r f iled S e p t. 17, 2009.