Court Opinion

ID: 4184
Source: CourtListenerOpinion
Date Created: 2010-04-24 19:37:38+00
Date Added: 2024-06-11T16:43:37.422652
License: Public Domain

09-1369-cv
MAFCO Elec. Contractors, Inc. v. Turner Constr. Co.

                                  UNITED STATES COURT OF APPEALS
                                      FOR THE SECOND CIRCUIT

                                                      SUMMARY ORDER
RULINGS BY SUM M ARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO SUM M ARY
ORDERS FILED AFTER JANUARY 1, 2007, IS PERM ITTED A ND IS GOVERNED BY THIS COURT’S
LOCAL RULE 32.1 AND FEDERAL RULE OF APPELLATE PROCEDURE 32.1. IN A BRIEF OR OTHER
PAPER IN W HICH A LITIGANT CITES A SUM M ARY ORDER, IN EACH PARAGRAPH IN WHICH A
CITATION APPEARS, AT LEAST ONE CITATION M UST EITHER BE TO THE FEDERAL APPENDIX OR
BE ACCOM PANIED BY THE NOTATION: “(SUM M ARY ORDER).” A PARTY CITING A SUM M ARY
ORDER M UST SERVE A COPY O F TH AT SUM M ARY ORDER TOGETHER W ITH THE PAPER IN
W HICH THE SUM M ARY ORDER IS CITED ON ANY PARTY NO T REPRESENTED BY COUNSEL
UNLESS TH E SUM M ARY ORDER IS AVAILABLE IN AN ELECTRONIC DATABASE W HICH IS
PUBLICLY ACCESSIBLE W ITHOUT PAYM ENT OF FEE (SUCH AS THE DATABASE AVAILABLE AT
HTTP://W W W .CA2.USCOURTS.GOV/). IF NO COPY IS SERVED BY REASON OF THE AVAILABILITY
OF THE ORDER ON SUCH A DATABASE, THE CITATION M UST INCLUDE R EFERENC E TO THAT
DATABASE AND THE DOCKET NUM BER OF THE CASE IN W HICH THE ORDER W AS ENTERED.

       At a stated term of the United States Court of Appeals for the Second Circuit, held
at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of
New York, on the 21 st day of December, two thousand nine.

PRESENT:             JOHN M. WALKER, JR.,
                     REENA RAGGI,
                                Circuit Judges,
                     JED S. RAKOFF,*
                                District Judge.

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MAFCO ELECTRICAL CONTRACTORS, INC.,
                                 Plaintiff-Appellant,

                               v.                                     No. 09-1369-cv

TURNER CONSTRUCTION COMPANY,
                                 Defendant-Appellee.
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          *
         District Judge Jed S. Rakoff of the United States District Court for the Southern
District of New York, sitting by designation.
APPEARING FOR APPELLANT:                          STEVEN B. KAPLAN, Michelson, Kane,
                                                  Royster & Barger, P.C., Hartford,
                                                  Connecticut.

APPEARING FOR APPELLEE:                           HOWARD M. ROSEN (David Fultz, on
                                                  the brief), Peckar & Abramson, P.C., New
                                                  York, New York.

       Appeal from the United States District Court for the District of Connecticut (Vanessa

L. Bryant, Judge).

       UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND

DECREED that the judgment of the district court, entered on March 30, 2009, is

AFFIRMED.

       Plaintiff MAFCO Electrical Contractors, Inc. (“MAFCO”), appeals from an award of

summary judgment in favor of defendant Turner Construction Co. (“Turner”) on MAFCO’s

breach of contract claim arising from Turner’s alleged mismanagement of the “Town Square

Project” in Hartford, Connecticut. MAFCO, an electrical subcontractor, asserts error in the

district court’s holding that a “no damages for delay” clause in the parties’ contract barred

MAFCO’s claim. We assume the parties’ familiarity with the facts and the record of prior

proceedings, which we reference only as necessary to explain our decision to affirm.

       1.     Standard of Review

       We review an award of summary judgment de novo, viewing the evidence in the light

most favorable to the nonmoving party and drawing all reasonable inferences in its favor.

See Sledge v. Kooi, 564 F.3d 105, 108 (2d Cir. 2009). We will affirm only where the record

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reveals “no genuine issue as to any material fact” and demonstrates the movant’s entitlement

to judgment “as a matter of law.” Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby, Inc., 477

U.S. 242, 247-48 (1986).

       2.     The Contract Claim

       MAFCO does not dispute that, under Connecticut Law, “no damages for delay clauses

are generally valid and enforceable and are not contrary to public policy.” White Oak Corp.

v. Dep’t of Transp., 217 Conn. 281, 288, 585 A.2d 1199, 1203 (1991) (internal quotation

marks omitted). Rather, MAFCO argues that its claims fall within one of several exceptions

to enforceability which allow recovery for delays that are, inter alia, (1) uncontemplated, (2)

so unreasonable as to constitute abandonment of contract, or (3) caused by breach of

fundamental contract obligations. Id. at 289 (adopting exceptions articulated by New York

Court of Appeals in Corinno Civetta Constr. Corp. v. New York, 67 N.Y.2d 297, 309, 502

N.Y.S.2d 681, 686 (1986)).1 We doubt that any reasonable jury could find that the alleged

delays fall within the cited exceptions, given MAFCO’s explicit waiver of claims based on

“delays, charges, acceleration, loss of efficiency or productivity disruptions and interferences

with the performance of the work,” Subcontract Agreement at 4 art. V, in a contract that

repeatedly references the very logistical challenges at the heart of MAFCO’s claim, including

       1
         MAFCO does not seek recovery pursuant to a fourth exception for delays caused by
bad faith or “willful, malicious, or grossly negligent conduct.” White Oak Corp. v. Dep’t of
Transp., 217 Conn. at 289, 585 A.2d at 1203.

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coordination of subcontractors, assignment of “out of sequence” work, adjustment of project

schedules, and compression and acceleration of work, see Corinno Civetta Constr. Corp. v.

New York, 67 N.Y.2d at 310, 502 N.Y.S.2d at 686 (observing that exculpatory clauses “are

generally held to encompass only those delays which are reasonably foreseeable, arise from

the contractor’s work during performance, or which are mentioned in the contract”).

       We need not decide the issue definitively, however, because we conclude that

MAFCO’s claim is foreclosed by a series of clear, unconditional release and waiver forms

signed by MAFCO during the course of the project.2 See Holcomb v. Lykens, 337 F.3d 217,

223 (2d Cir. 2003) (“It is well-settled that we may affirm on any grounds for which there is

a record sufficient to permit conclusions of law, including grounds not relied upon by the

district court.” (internal quotation marks and alteration omitted)). MAFCO signed more than

two dozen change order forms that contained the following language:

           Through acceptance of this Change Order, this Subcontractor
           acknowledges that it has reviewed the progress of the work related to
           this Project and the potential impact of the additional work on the
           progress of the project in the future. As a result, this Change Order
           includes compensation to the Subcontractor for any and all effects,
           delays, inefficiencies or similar demands associated with this Project
           and the Subcontractor recognizes that there is no basis for any such
           claim in the future.

Affidavit of Daniel P. Wilson in Support of Defendant’s Motion for Summary Judgment, Ex.

       2
        We also need not decide whether the record reveals a question of fact as to whether
MAFCO provided Turner with notice sufficient to preserve its claims under the terms of the
contract.

                                             4
O. MAFCO also signed several “Lien Waiver and Release” forms in connection with

payment applications, waiving all rights to seek payment adjustments “for any reason or

matter arising out of or related to matters occurring or existing on or before the date hereof.”

Id. Ex. M. The language of these provisions unambiguously relieves Turner of liability for

the alleged delays. See Ramirez v. Health Net of Ne., Inc., 285 Conn. 1, 13, 938 A.2d 576,

586 (2008) (“Where the language is unambiguous, we must give the contract effect according

to its terms.” (internal quotation marks omitted)).

       MAFCO argues that Turner waived reliance on these provisions in 2004 when it

agreed to settle a series of delay-related claims through a change order payment. MAFCO

contends that the payment constituted a course of conduct establishing Turner’s consent not

to rely on MAFCO’s waiver of rights to sue. We are not persuaded. Turner’s willingness

to settle one batch of claims cannot be construed as a course of conduct barring contractual

defenses to subsequent claims. See Dunnigan v. First Bank, 217 Conn. 205, 209, 585 A.2d

659, 661 (1991) (observing that two separate transactions do not constitute “continual course

of business dealings”); Restatement (Second) of Contracts § 223 (1981) (defining course of

dealing as “sequence of previous conduct between the parties” fairly understood to establish

“common basis of understanding for interpreting” their actions). Even assuming arguendo

that Turner’s settlement of one set of claims could establish a course of dealing, the

subcontract plainly states that “no term or provision . . . may be waived by Turner except in

                                               5
writing,” Subcontract Agreement at 13, Art. XXVI, and the change order forms expressly

state that they are governed by the terms and conditions of the subcontract. The Connecticut

Supreme Court has made clear that failing to construe a non-waiver provision strictly would

“eviscerate any inclination or incentive a [party] might have to extend any kind of generosity

or flexibility . . . on the even of commencing litigation.” Webster Bank v. Oakley, 265 Conn.

539, 551, 830 A.2d 139, 147-48 (2003); see also id. at 550-51 (in case involving non-waiver

provision, rejecting argument that whether contractual right was waived created genuine

issue of material fact precluding summary judgment); Christensen v. Cutaia, 211 Conn. 613,

619-20, 560 A.2d 456, 459 (1989). Because of the subcontract’s non-waiver provision and

its incorporation by reference in the change order form, MAFCO must offer written evidence

that Turner expressly waived its contractual rights and not simply that it engaged in some

alleged course of dealing.

       In any event, MAFCO executed several change order and release forms after

accepting the first settlement and after Turner explicitly stated its intention to rely on the

waiver and release provisions to reject further claims. See Conn. Nat’l Bank v. Douglas, 221

Conn. 530, 545, 606 A.2d 684, 691 (1992) (“While a determination about a party’s intent to

waive his rights ordinarily poses a question of fact, clear and definitive contract language can

establish waiver as a matter of law.”); see also Kay-R Elec. Corp. v. Stone & Webster Constr.

Co., 23 F.3d 55, 58 (2d Cir. 1994) (concluding that plain language in payment requisition

                                               6
form constituted “clear and unambiguous” intent to release defendant from claims for

additional expenses). Finally, MAFCO implicitly acknowledged the binding nature of the

lien waiver and release forms when, in 2007 and 2008, it inserted language seeking to

exclude from the release claims raised in its then-pending lawsuit against Turner – claims

already released in previous change order and release forms. In sum, MAFCO cannot escape

its repeated, express agreement not to file suit seeking compensation for project delays.

       We have considered plaintiffs’ remaining arguments on appeal and conclude that they

are without merit. Accordingly, the judgment of the district court is AFFIRMED.

                            FOR THE COURT:
                            CATHERINE O’HAGAN WOLFE, Clerk of Court

                            By:

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