Court Opinion

ID: 9654644
Source: CourtListenerOpinion
Date Created: 2023-08-23 18:45:59.352226+00
Date Added: 2024-06-11T18:13:12.163707
License: Public Domain

SOMERVILLE, Judge,
dissenting.
I respectfully dissent from that portion of the majority opinion reversing the judg*849ment rendered by the trial court in favor of defendant and against plaintiff on count two notwithstanding the verdict.
The sanitary sewer and pump station project, for which plaintiff was the successful bidder, was located east of Independence along U.S. Highway 58 in the flood plain of the Little Blue River. Insofar as pertinent to this dissent, plaintiff, although paid the full bid price ($1,193,288.96) by defendant, brought suit against defendant claiming compensation for additional work and materials in conjunction with the project in excess of the bid price.
According to plaintiff, instability of the bottom and sides of excavations occasioned by ground water encountered after the project got underway entailed additional costs exceeding the bid price in the amount of $583,935.00. Count two was submitted to the jury on the theory that defendant made positive representations of a material fact which were false or incorrect, i.e., regarding the presence and extent of ground water, which plaintiff relied on to its detriment. See Ideker, Inc. v. Missouri State Highway Commission, 654 S.W.2d 617 (Mo.App.1983), and cases cited therein, for a fuller explanation of the theory of recovery purportedly relied on by plaintiff.
The jury returned a verdict in favor of plaintiff and against defendant on count two and awarded plaintiff damages in the sum and amount of $225,000.00. The trial court, pursuant to a motion for judgment notwithstanding the verdict, set aside the verdict on count two and entered judgment thereon in favor of defendant and against plaintiff.
The matters purportedly relied on by plaintiff, and acquiesced in by the majority opinion, which supposedly constituted “positive representations” of the absence of ground water when the bid was let, are threefold: (1) “auger borings” obtained and logged in April-June of 1974; (2) a drawing identified as “Figure 1-2A” showing the depth of excavations and the amount and type of bedding upon which pipe was to be superimposed, in conjunction with a contractual provision that “[ejxcept where otherwise required, proper trenches shall be excavated below the underside of the pipe, as shown on Figure 1-2A, to provide for the installation of granular imbedment pipe foundation material” (emphasis added); and (3) absence of a provision in the contract for the successful bidder to furnish additional bedding material.
At the risk of engaging in oversimplification, this dissent will endeavor to reduce the facts and issues to ultimate basics and dispose of them accordingly. The majority opinion holds that the trial court erred in entering judgment in favor of defendant and against plaintiff on count two, notwithstanding the verdict, because under the evidence, according to the appropriate standard of appellate review, plaintiff was entitled to an award of damages under the theory of recovery explicated in Ideker, Inc. v. Missouri State Highway Commission, supra. The majority opinion misreads Ideker. The requisite elements of such a cause of action are: “(1) A positive representation by a governmental entity, (2) Of a material fact, (3) Which is false or incorrect, (4) Lack of knowledge by a contractor that the positive representation of the material fact is false or incorrect, (5) Reliance by a contractor on the positive representation of a material fact made by the governmental entity, and (6) Damages sustained by a contractor as a direct result of the positive representation of a material fact by the governmental entity.” (emphasis added) Ideker, Inc. v. Missouri State Highway Commission, supra, 654 S.W.2d at 621. The logic and rationale giving rise to the doctrine relied upon in Ideker reflects a reconciliation of conflicting principles by the courts during the embryonic stage of the doctrine. Id. 621.
The majority opinion necessarily holds that the “auger boring” logs appended to the principal contract constituted a positive representation of a material fact by defendant, which was false or incorrect, and *850relied on by plaintiff. Namely, that ground water, at variance with the “auger boring” logs ostensibly relied on by plaintiff in calculating its bid, was encountered after the project got underway, thereby escalating the cost of completing the project beyond the bid price. The “auger borings” in question were obtained and logged in April-June of 1974, and the “auger boring” logs ostensibly relied on by plaintiff were, in clear and explicit terms, correspondingly dated April-June, 1974. The project was not advertised for bids until October 15, 1976, at which time plaintiff first became aware of the “auger boring” logs dated April-June, 1974• There is not one iota of evidence that the “auger boring” logs did not truly and correctly disclose subsurface soil conditions and ground water as of April-June, 1974. As a matter of fact, plaintiff does not contend that the “auger boring” logs did not correctly portray subsurface soil conditions and ground water levels as of April-June, 1974- Moreover, the uncontradicted evidence was that ground water levels sporadically change.
It is important to note that the principal contract, with reference to the “auger boring” logs, provided, inter alia, that “[tjhere is no expressed or implied guarantee as to the accuracy of the data nor of the interpretation thereof” and each “bidder must form his own opinion of the character of the material which will be encountered from an inspection of the ground, from his own interpretation of the test hole information, and from such other investigation as he may desire.” Assuming, arguendo, that the “auger boring” logs constituted a positive representation of subsurface soil conditions and ground water as of April-June, 1974, they were suggestive, at best, as opposed to positive representations, of subsurface soil conditions and ground water as of October 15, 1976. Although it has been held that disclaimer provisions similar to the one heretofore mentioned do not negate reliance on positive representations, they may preclude reliance on “implied” or “suggestive” representations. Ideker, Inc. v. Missouri State Highway Commission, supra, 654 S.W.2d at 623. In the temporal context governing this case, the “auger boring” logs dated April-June, 1974, did not constitute a positive representation as to the level and extent of ground water at the project site when plaintiff submitted its bid and undertook to perform the contract. The “auger boring” logs, by reason of the dates on them, carried their own caveat.
With reference to “Figure 1-2A” regarding the amount of granular bedding material upon which the pipe was to be laid, the language in the accompanying contractual provision, “[ejxcept where otherwise required ” (emphasis added), clearly discloses that the amount of granular bedding material was not an unyielding constant but was subject to variance where required.
With reference to the absence of a contractual provision requiring the successful bidder to furnish additional bedding material, it is patent that silence cannot be elevated to the status of a positive representation.
Whether plaintiff relied upon the “auger boring” logs dated April-June, 1974, “Figure 1-2A”, and the absence of a contractual provision as to furnishing additional bedding material is not the real issue. The real issue is whether they constituted positive representations of a material fact which plaintiff had a right to rely upon without any attendant obligation to check existent conditions.
The theory of recovery identified with Ideker, Inc. v. v. Missouri State Highway Commission, supra, was never intended to be a panacea for every successful bidder whose costs overrun the bid price. Hence, the emphasis upon a positive representation of a material fact by a governmental entity which is false or incorrect and relied upon by a contractor. Otherwise, this innovative theory of recovery could never be reconciled with the well-established principle of contract law, finding clarity of expression in United States v. Spearin, 248 U.S. 132, 136, 39 S.Ct. 59, 61, 63 L.Ed. 166 *851(1918), that when one agrees to do a thing possible of performance “he will not be excused or become entitled to additional compensation, because unforeseen difficulties are encountered.” Extension of the theory of recovery identified with Ideker to the facts of this case dilutes the bidding process on public projects and makes it impossible for governmental entities to intelligently utilize and appropriate available funds. Furthermore, doing so rewards careless and indifferent bidders at the expense of both the public sector and responsible bidders.
The judgment rendered by the trial court, in favor of defendant and against plaintiff under count two of plaintiffs petition, notwithstanding the verdict, should be affirmed.