Opinion ID: 2551501
Heading Depth: 2
Heading Rank: 4

Heading: Interpretation of the Contract: Delay Damages

Text: The Court of Special Appeals held that the trial court's final judgment must be reversed because of a failure to comply with Md. Rule 2-522(a) [24] and because it was impossible to know whether delay damages had been awarded in the judgment, when as a legal matter, delay damages were expressly precluded by the terms of the Contract. BEKA contends that the Court of Special Appeals erred in determining that the contract contained a broad no-damages-for-delay clause. There is no evidence in the record that the trial judge engaged in any legal analysis of the issue of delay damages under the contract, ostensibly because BEKA did not present its claim for damages under Counts 23, 40, 42, 44 and 45 as delay damages even though in closing argument the County Board asserted that characterization. [25] Having been asked by the County Board on appeal, however, to determine if BEKA was entitled to delay damages under the contract, the intermediate appellate court reviewed the contract. The interpretation of written contracts presents a question of law for the trial court, which an appellate court reviews de novo. United Services v. Riley, 393 Md. 55, 79, 899 A.2d 819, 833 (2006) (quoting Towson University v. Conte, 384 Md. 68, 78, 862 A.2d 941, 946 (2004)). Courts in Maryland follow the law of objective interpretation of contracts, `giving effect to the clear terms of the contract regardless of what the parties to the contract may have believed those terms to mean.' Riley, 393 Md. at 79, 899 A.2d at 833 (quoting Towson University, 384 Md. at 78, 862 A.2d at 946-47). The Court of Special Appeals held that § 8.3.1 of the Contract precluded BEKA from recovering delay damages from the County Board because the express language provided that [e]xtension of time shall be Contractor's sole remedy for delay. BEKA, 190 Md.App. at 734, 989 A.2d at 1219 (quoting § 8.3.1. of the disputed contract). BEKA asserted that even if § 8.3.1 barred delay damages, other provisions in the Contract modified the plain language of § 8.3.1 thereby expressing the parties mutual assent to accommodate delay damages. On that point, the intermediate appellate court held that the parties nullified other provisions in the contract that may have allowed damages for costs incurred due to delay. Thus, the contract here clearly precluded BEKA from recovering damages for delay. BEKA, 190 Md.App. at 734, 989 A.2d at 1219-20. The Court of Special Appeals did not identify which other provisions had been nullified by the parties or how. In response to BEKA's alternative assertions that its claims on Counts 23, 40, 42, 44 and 45, totaling $448,349, were not delay damages but direct costs recoverable under the contract, or that they were delay damages but the clause was unenforceable because of nefarious actions by the County Board, the intermediate appellate court determined that both were determinations appropriately made by the trier of fact, but that the trial court made no factual findings on the issues. BEKA, 190 Md.App. at 735, 989 A.2d at 1220. Specifically, the Court of Special Appeals held that: we cannot ascertain if the court found: (1) as a matter of law, that the contract did not preclude delay damages; (2) as a matter of fact that the damages sought were not delay damages; (3) as a matter of the fact that the damages sought were for delay, but the Board's actions prevented enforcement of the no-damages-for-delay provisions; or (4) that some of the claims were not timely submitted pursuant to the terms of the contract. BEKA, 190 Md.App. at 736, 989 A.2d at 1220. Therefore, lacking factual and legal conclusions upon which to assess whether it would be appropriate to affirm the trial court's judgment, the intermediate appellate court reversed the judgment and ordered a new trial. See e.g., Della Ratta v. Dyas, 414 Md. 556, 565, 996 A.2d 382, 387 (2010) (Pursuant to Maryland Rule 8-131(c), where, as here, an action has been tried without a jury, the appellate court will review the case on both the law and the evidence. We will not set aside the judgment of the trial court on the evidence unless clearly erroneous.) (citing Md. Rule 8-131(c)). We concur.