Opinion ID: 2498928
Heading Depth: 3
Heading Rank: 2

Heading: As-Built Survey Breach

Text: [¶ 28] The district court granted Berthel's motion for summary judgment on the question of whether Rockies Express violated Paragraph 8(q), again with no findings of fact, contract interpretation, or rationale for its ruling. Following the trial on damages, the district court, again with a different presiding judge, awarded damages to Berthel. The court calculated the damages necessary to compensate Berthel for the cost of obtaining an as-built survey showing the contours of the land disturbed by the pipeline construction and showing the depth of the pipeline. The court placed a particular emphasis on obtaining the pipeline depth information. [¶ 29] On appeal, Rockies Express challenges the summary judgment ruling on liability, contending that it did not breach the as-built survey requirement. Berthel challenges the district court's damages award, contending it improperly reduced Berthel's damages from $75,284.65 to $42,820.00. Our initial task is to interpret the requirements of Paragraph 8(q), a question of law, and we then turn to whether issues of fact precluded the district court from granting Berthel summary judgment on Rockies Express' alleged breach of the provision. We will then consider the question of damages.
[¶ 30] Paragraph 8(q) of the Agreement required Rockies Express to provide Berthel with an as-built survey of the pipeline, as follows: Grantee shall provide Grantor with an as-built survey of the pipeline as it pertains to the lands described on Exhibit A. In the event said as-built survey determines that the total distance of the pipeline as measured along the ground surface is greater than the distance depicted in Exhibit A, Grantee shall compensate Grantor for each additional foot at the same price per foot paid as calculated in this Easement. If the distance is less, no adjustment shall be made. Berthel contends that the purpose of Paragraph 8(q) was two-fold: 1) to calculate the precise linear feet of ground disturbed by the pipeline, so Berthel was compensated for the full length of the pipeline; and 2) to address safety concerns. Rockies Express contends that the requirement served one purpose only and that was to establish the total distance of the pipeline, as built, to ensure Berthel was compensated for the full length of the pipeline. [¶ 31] Neither party provided, in support of their cross motions for summary judgment, expert evidence on the definition of an as-built survey, that is, evidence of the term's usage in the construction industry or more particularly in these types of easement agreements. Nonetheless, we find the Agreement to be unambiguous. Paragraph 8(q) requires that Rockies Express provide Berthel an as-built survey, and it specifies that the survey must show the total distance of the pipeline as measured along the ground surface. The provision then requires that Berthel be paid additional compensation per foot if the distance covered by the pipeline, as measured along the ground, is greater than calculated distance for which Berthel was originally compensated. [¶ 32] Paragraph 8(q) does not mention the depth of the pipeline, impose any requirement that depth data be provided, or cite safety purposes to be served by the as-built survey. This omission is consistent with the Agreement as a whole. There was no need for Rockies Express to provide depth information in the as-built survey because the Agreement, in Paragraph 8(a), separately requires that the pipeline be installed to a depth sufficient to provide for a minimum of thirty-six inches (36) of cover. Additionally, the Agreement bars any activity by Berthel on the easement that could present a safety concern, without first providing notice to Rockies Express. Specifically, Paragraph 3 of the Agreement provides in part: Grantor shall not build, construct, or permit to be built or constructed, any structure or obstruction, or impound water or any substance, or change the grade on or over the [E]asement, except that with prior notice to Grantee, Grantor shall be permitted to construct fences, roads, above-ground water lines and distribution systems, power transmission lines, communication lines and wind generation facilities across the Easement. [¶ 33] The Agreement's unambiguous language required Rockies Express to provide an as-built survey showing the distance of the pipeline as measured along the ground surface. It did not require that Rockies Express provide depth data, and any safety concerns related to such data are addressed by other provisions in the Agreement. [¶ 34] The question we must next answer then is whether the record supports the district court's summary judgment ruling on the as-built violation; that is, whether the undisputed evidence showed that Rockies Express failed to provide Berthel with an as-built survey showing the required measurement along the ground surface.
[¶ 35] Based on this Court's interpretation of Paragraph 8(q), the question before the district court on summary judgment was whether the as-built survey that Rockies Express gave Berthel provided Berthel with the required measurement along the ground surface, that is, contour measurements. On this question, Berthel submitted to the district court the affidavit of its engineering expert, James Murphy, and the deposition testimony of Mark Miller, the professional land surveyor who performed all surveying work for Rockies Express on the Berthel ranch. The evidence from both of these witnesses indicated agreement that the as-built survey did not provide sufficient data to make the measurements and calculations required by Paragraph 8(q). [¶ 36] In his affidavit, James Murphy stated: I have personally reviewed the EXHIBIT A BERTHEL LAND AND LIVESTOCK, LTD 42 PIPELINE AS-BUILT PROFILE dated 06/22/07 (EXHIBIT 4). That profile cannot serve as or be utilized as, an accurate contour as-built survey of the pipeline, because of the lack of detail and/or small scale presented. The actual contour footage of the pipeline cannot be calculated based upon the reviewed document. The reviewed document does not specifically or accurately identify the depth of ground cover existing along the pipeline on the Plaintiff's ranch property. In order to accurately calculate the contour footage of the pipeline as constructed on the Plaintiff's ranch property, a much larger scale, greater detail, of the pipeline, as it has been located in the ditch, would be required, such as would be provided upon as-built alignment sheets. [¶ 37] Mark Miller testified: Q.    You can't calculate exactly that 114.2 linear contour rods of the pipeline from Exhibit A, can you? A. No. Q. Could you calculate that from the as-built onlyor as-built alignment sheet? A. I believe so. I believe they record 3D distances. Q. Could you calculate it better from the elevation spreadsheet? A. Yes. Q. What would be the best document in existence that you could calculate that A. The spreadsheet would be. Q. That contour elevation rod linear footage? A. Well, I say the spreadsheet would be, but you also have to combine that. The property line information is not in the spreadsheet. The spreadsheet only cares about the pipeline and so it has to beit's either going to have to be the alignment sheets or from a product that's specifically designed to do that. I would have to have a specific request for a profile with a specific level of detail so thatbasically so I knew what was being asked for. I'd have to have a specific request through the customer that this is what we want, please produce it. [¶ 38] In response, Rockies Express submitted to the district court a copy of the survey provided to Berthel, also known as Exhibit A, and a copy of a letter from Rockies Express advising Berthel that based on as-built calculations, Berthel was entitled to an additional payment of $403.41. [¶ 39] The evidence Rockies Express submitted on the question of the as-built liability was insufficient to raise an issue of fact. It simply did not confront, and left unopposed, the evidence of both James Murphy and Mark Miller that the required calculations could not be made from Exhibit A. We thus conclude that the record supports the district court's ruling that the undisputed evidence showed that Rockies Express failed to provide Berthel with an as-built survey showing the required measurement along the ground surface.
[¶ 40] As stated above, damages are designed to put the plaintiff in the same position as if the contract had been performed. See Capshaw, ¶ 10, 44 P.3d at 52. With respect to the as-built survey violation, this means that the damages must be such as will compensate Berthel for Rockies Express' failure to provide an as-built survey showing the contour measurements required by Paragraph 8(q). [¶ 41] In support of its damages claim, Berthel submitted a quote from its engineering expert, James Murphy, detailing the tasks required to complete an as-built survey, and the costs associated with each of those tasks. The total cost calculated by Murphy was $75,284.65, and this was the amount of damages demanded by Berthel. [¶ 42] The district court accepted the Murphy quote, but modified it in some respects. The district court found Murphy's proposal to survey the depth of the pipeline by digging 245 holes down to the pipeline using heavy equipment to be a dangerous and unreasonable means to determine the pipeline depth. It thus subtracted from the Murphy quote all costs associated with that task and added in the costs of an alternative, safer method of determining the pipeline depth. Based on these adjustments, the district court awarded damages for the as-built survey breach in the amount of $42,820.00. [¶ 43] We find the district court's award clearly erroneous. Our concern with the award, and with the quote on which it was based, is the emphasis of each on providing an as-built survey that details the precise depth of the pipeline along the easement. Based on our interpretation above, Paragraph 8(q) did not require Rockies Express to provide Berthel with an as-built survey detailing the depth of the pipeline, and costs to provide that level of detail are therefore not a proper element of damages. [¶ 44] Unlike the damages for rock removal, the damages for the as-built survey violation are itemized, allowing us to make a damages calculation that accurately fits our interpretation of Paragraph 8(q). The Murphy quote is broken down into tasks relating to data gathering and preparation of the final drawings. The data gathering tasks are in turn broken down further into those relating to the contour measurements (required under our interpretation) and the depth measurements (not required under our interpretation). We are thus able to extract the costs of the required tasks and recalculate the damages to which Berthel is entitled. [¶ 45] Task I of the Murphy quote gathers the data necessary to determine the ground distance, that is, the required contours for calculating the full distance covered by the pipeline. The total cost of this task is $7,200.00. The final task of the Murphy quote is the preparation of a final as-built plan and profile map. The cost associated with this task is $4,535.00. The remaining tasks under the quote relate to excavations to determine depth, which we have deemed unnecessary. Totaling the task costs of $7,200.00 and $4,535.00 would thus conclude our calculation, but for the trial testimony of James Murphy. [¶ 46] During the trial on damages, Mr. Murphy, on cross-examination, testified that when he provided his affidavit on the adequacy of the as-built survey given to Berthel, and when he calculated his quote to prepare an as-built survey, Berthel had only provided him with one page of the eight-page survey submitted by Rockies Express. He did not have the first seven pages of the survey data. He further testified that the data provided in the first seven pages of the survey was sufficient to allow the preparation of an as-built survey detailing the contour footage, without the costs associated with Task I in his quote: Q.    In your affidavit you said in order to calculate the contour footage of the pipeline as constructed you would need as-built alignment sheets, and those are the measurements that are provided in the first seven pages of Exhibit R? A. I would agree with that. Q. So that $7,200 on the second two pages on the as-built drawings, that $7,200 is exactlywhat that is for is to establish the distance along the ground? A. Partially. Q. The contour footage? A. Partially as it is discussed in Task 1, that is correct. What you need to realize is Task 1 carries over to Task 2 because we locate the test pit locations under Task 1. If we didn't have to determine the horizontal or the ground distance we would still have to go out and stake the test pits every hundred feet and at the ground breaks. It may not take quite the level of accuracy that Task 1 required, so I could certainly say that some of that costs would stillunder Task 1 would still be required. How much of it may or may not be, I'd have to put a pencil to it. Q. Sobut had you had thatall of Exhibit R at the time you prepared this you would have been able to see exactly what the contour footage was? A. Correct. That certainly would have affected the costs of Task 1. I'm not going to deny that. [¶ 47] Mr. Murphy's only apparent reservation with regard to subtracting the Task I costs from the quote was his need for the Task I ground data to facilitate Task II, the gathering of depth data. Because, again, the gathering of depth data is not a proper element of damages, and the original as-built survey contained all the data Mr. Murphy required to complete the as-built survey showing the contour measurements, we must subtract the costs of Task I, $7,200.00, from the damages calculation. [¶ 48] We conclude that an award of $4,535.00, Mr. Murphy's cost to prepare the final as-built plan and profile map, will place Berthel in the position it would have been had Rockies Express complied with the requirements of Paragraph 8(q).