Opinion ID: 2099317
Heading Depth: 3
Heading Rank: 4

Heading: Fixed Price Contracts

Text: Finally, Della Ratta appeals the trial court's finding that DRI entered into a verbal agreement with Bay View to construct Maresol on a fixed price basis. He argues that the evidence indicates that the contract was actually a cost-plus contract. The absence of a written agreement required the trial court to construct the terms using letters between Dyas and Della Ratta, the testimony of both men, and various other company documents. The trial court found that the parties originally agreed upon a fixed price of $4,585,825, but increased that amount to $5,613,438 through authorized change orders. The trial court also found that the defendants received $3,163,517.13 in excess of the contract and ordered them to return that amount to Bay View. Della Ratta first challenges the trial court's conclusions by zeroing in on a misstatement made by the judge as he rendered his opinion from the bench. When examining an August 6, 2002 letter authored by Della Ratta, the trial court read part of one sentence as: We started with a fixed-price contract .... (emphasis added). The language Della Ratta actually used was: We started with a fixed contract price .... (emphasis added). We do not view the judge's inversion of contract and price as indicative of an inappropriate reading of the substance of the letter. Either version could reasonably lead a trier of fact to read Della Ratta's letter as acknowledging the existence of a contract that fixed a price at which DRI was to construct Bay View. Della Ratta's own testimony supports this interpretation. When asked about the letter, he did not attempt to deny that the statement referred to a fixed price contract, but rather simply characterized it as a clerical error. This supposed error extended to the next sentence in the letter, which explained that the increase in costs from $4,585,825 to 5,613,438 are the responsibility of Della Ratta, Inc.[,] instead of Bay View, as Della Ratta contends. [20] The 2002 letter did not contain the sole clerical error in this case, as conceded by Della Ratta. During the construction of Maresol, Bay View obtained a loan from Severn Bank. Thereafter, DRI and Bay View executed twelve change orders, all of which were signed by Della Ratta and an agent of DRI. Each of these change orders listed $4,585,825.56 as the guaranteed maximum price, for example: The original (Contract Sum)(Guaranteed Maximum Price) was $4,585,825.56. The net change by previously authorized Change Orders $966,180.34 The (Contract Sum)(Guaranteed Maximum Price) prior to this Change Order was $5,552,005.90 The (Contract Sum)(Guaranteed Maximum Price) will be (increased) (decreased) (unchanged) by this Change Order in the amount of $23,668.20 The new (Contract Sum) (Guaranteed Maximum Price) including this Change Order will be $5,575,674.10 The Contract Time will be (increased) (decreased) (unchanged) by ZERO (0) days. The alleged error in the language was authorized by Della Ratta a dozen times, yet it never came to his attention until trial. Ultimately, the trial court did not accept Della Ratta's argument and concluded that references to fixed price contracts were not clerical errors, but they were actual expressions of the parties' understanding. The CSA supplemented the trial court's finding by observing that it was consistent with the parties's contemporaneous course of conduct where, after constructing Maresol, DRI also agreed to construct the New Hotel under a fixed price contract. See Della Ratta, 183 Md. App. at 369, 961 A.2d at 644. Della Ratta extensively quotes from his attorney's cross-examination of Dyas, arguing that Dyas's testimony conflicts with his argument for a fixed price contract. The trial court also considered this, but [did not] find that the trial testimony or any other evidence overcame [the admission in the 2002 letter]. Weighing the credibility of witnesses and resolving any conflicts in the evidence are tasks proper for the fact finder. State v. Smith, 374 Md. 527, 533-34, 823 A.2d 664, 668 (2003) (quotation marks and citations omitted). As an appellate court, we do not re-weigh the evidence, but rather determine whether sufficient evidence exists to support the trial court's judgment. Id. at 534, 823 A.2d at 668. We believe that there was sufficient evidence to indicate that the parties entered into a fixed price contract and thus the trial court's findings were not clearly erroneous.