Court Opinion

ID: 9513702
Source: CourtListenerOpinion
Date Created: 2023-08-06 22:39:21.946546+00
Date Added: 2024-06-11T09:05:58.810818
License: Public Domain

MARING, Justice,
concurring in part and dissenting in part.
[¶ 28] I concur in most of the majority opinion, but dissent from that part which concludes all of Gratech’s claims must be arbitrated. I am of the opinion that Gra-tech, by entering into a contract with the North Dakota Department of Transportation (“NDDOT”) for the construction of a federal aid project on U.S. Highway 281, did not agree to arbitrate intentional tort claims.
[¶ 29] Gratech brought an action against Wold, the project engineer, alleging it bid the project in reliance upon the information furnished by the NDDOT; that nothing in the proposal or contract documents disclosed unstable soil conditions on the project; that when the unstable soil conditions were encountered, Wold, as the engineer, directed certain work done, classifying it as incidental, and denied payment for any additional working days or price adjustments; and that Wold misconstrued and misapplied the specifications and wrongfully denied payment to Gratech. Gratech alleges six causes of action:
1) Breach of the duty to provide professional engineering services,
2) Wold acted arbitrarily and capriciously and/or in bad faith and/or abused its discretion and professional judgment in determining the nature of unsuitable soil,
3) Wold -wrongfully and improperly construed the contract to deny payment to Gratech,
4) Wold negligently misrepresented the contract plans and specifications,
5) Wold intentionally and willfully deceived Gratech with intent to get him to alter his position on its right to compensation for extra work, and
6) For punitive damages.
Whether the claims and causes of action arise out of the contract under N.D.C.C. § 24-02-26 requires an examination of the nature of the claims and causes of action and their relationship to the contract.
[¶ 30] In this case, Gratech must plead and prove its contract with the NDDOT, which it relied on to bid the project. The interpretation of the contract is the subject of the alleged misrepresentations by Wold to Gratech. At first glance, I agree it appears the alleged torts of negligence and misrepresentation are closely interwoven with the contract. However, Gratech did not enter into a contract with Wold agreeing to arbitrate intentional torts, nor did its contract with the NDDOT or N.D.C.C. *680§ 24-02-26 mandate such. The majority relies heavily on Valero Energy Corp. v. Wagner and Brown, II, 777 S.W.2d 564 (Tex.Ct.App.1989). In Valero, the Texas Court of Appeals stated:
On the other hand, if there were allegations of some intentional tort visited directly by Valero on Wagner, e.g., defamation or assault, or some cause of action antithetical to the contract, e.g., fraudulent inducement to enter into the contract or quantum meruit, the phraseology of the arbitration clause would have to be broad, indeed, to require arbitration.
Id. at 567.
[¶ 31] Because Gratech alleges in his complaint Wold “intentionally and willfully deceived the Contractor, with the intent to induce him to alter his position to his injury or risk ...,” I respectfully dissent from the majority’s conclusion that all of Gratech’s claims are arbitrable.