Court Opinion

ID: 9565623
Source: CourtListenerOpinion
Date Created: 2023-08-21 19:24:43.695346+00
Date Added: 2024-06-11T09:19:47.918237
License: Public Domain

STEWART, Justice:
(dissenting in part and concurring in part).
I dissent from the majority opinion in this case on the ground that there is no rule of law which supports plaintiff’s recovery of damages for additional expenses incurred in obtaining suitable borrow material to meet the specifications of the road construction contract.
*371The majority treats this case as if it were simply an application of the principle of law relied upon in E. H. Morrill Co. v. State, 65 Cal.2d 787, 56 Cal.Rptr. 479, 423 P.2d 551 (1967), but it is not. That case is an application of the general proposition stated in Souza & McCue Construction Co. v. Superior Court of San Benito, 57 Cal.2d 508, 20 Cal.Rptr. 634, 635-36, 370 P.2d 338, 339-340 (1962):
A contractor of public works who, acting reasonably, is misled by incorrect plans and specifications issued by the public authorities as the basis for bids and who, as a result, submits a bid which is lower than he would have otherwise made may recover in a contract action for extra work or expenses necessitated by the conditions being other than as represented. [Citations.] This rule is mainly based on the theory that the furnishing of misleading plans and specifications by the public body constitutes a breach of an implied warranty of their correctness. The fact that a breach is fraudulent does not make the rule inapplicable. [Emphasis added.] 1
It is perfectly reasonable to hold that plans and specifications which make representations of fact as to conditions upon which a contractor bases a bid should be held to warrant the correctness of those representations. But it is altogether another proposition to hold that low level state employees, without authorization from any superior, without any particular training, and without specialized knowledge, can make a statement which the state must warrant.
Every case cited in the majority opinion to support the recovery in this case for the increased expenses resulting from having to obtain other borrow material is based upon factual representations contained in written plans and specifications. See Hollerbach v. United States, 233 U.S. 165, 34 S.Ct. 553, 58 L.Ed. 898 (1914); E. H. Morrill Co. v. State, supra; [65 Cal.2d 787, 56 Cal.Rptr. 479, 423 P.2d 551 (1967)]; Wunderlich v. State of California, 65 Cal.2d 777, 56 Cal.Rptr. 473, 423 P.2d 545 (1967).
The only Utah case cited by the majority to support recovery in this case is L. A. Young Sons Construction Co. v. County of Tooele, Utah, 575 P.2d 1034 (1978). However, L. A. Young does not support the result in this case at all. That case expressly relied upon the general proposition above referred to, i. e., that plans and specifications supplied by a public authority may be deemed to warrant the correctness of a factual representation contained therein. In fact, L. A. Young supports the exact contrary conclusions, in my view. The issue in that case was whether the construction company could avoid a liability on a counterclaim by the County of Tooele for work done in connection with the construction of an airport because of its reliance upon a water table chart supplied by the county, which, although not false, was misleading to the extent that it did not indicate that the water table in fact fluctuated. In L. A. Young, the Court relying on Wunderlich stated (575 P.2d at 1038):
The Wunderlich case is applicable to the instant action. The information containing the water table was not included in the plans and specifications but was provided at plaintiff’s request. The information concerning the tests was accurate. There was no representation that the water table would be the same at the time plaintiff commenced construction. It was pure assumption on the part of the plaintiff the water table would remain constant. Furthermore, the contract contained a specific disclaimer as to any information regarding soil or material bor-ings or tests. “The information is not guaranteed and no claims for extra work or damages will be considered if it is found during construction that the actual soil or material conditions vary from those indicated by the borings.”
Defendant had no knowledge of any impediments to performance and had made no misrepresentations as to conditions. To hold defendant liable under such circumstances would cast upon it responsibility for all conditions a contractor might encounter and make the cost of the project an unknown quantity.
*372Another aspect of significance is that plaintiff, neither in his complaint nor amended complaint, alleged it relied on the information as a basis in making its bid, that it acted reasonably in relying on the information, and as a result it submitted a bid which was lower than it would have otherwise made. Plaintiff’s entire claim reduced to its basic elements is that defendant should bear responsibility for any condition which plaintiff did not subjectively anticipate and that defendant had a duty to assure that the conditions at the project site reached all of plaintiff’s optimistic expectations. This theory is contrary to all the aforecit-ed law. [Emphasis added.]
In the instant case the record shows that the state employee who suggested Utelite as a potential source of borrow material had no training with the State Department of Transportation or its predecessor agency in the area of materials or the testing of materials. He did not claim to know whether any material from the Utelite pit had ever been used in highway construction. Nor did he claim to know whether that material had been tested for such use. He made no positive representations to the plaintiff beyond his unsupported statement that material from the Utelite pit was available and could be used for borrow. The plaintiff then relied on this statement without further substantiation and calculated the bid item of borrow on the basis of taking the necessary material from the Utelite pit.
A reasonably prudent contractor would not have relied upon the statement of the state employee. In the first place, § 102.05 of the State’s Standard Specifications provides that:
The submission of a bid shall be considered prima facie evidence that the bidder has made such examination and is satisfied as to the conditions to be encountered in performing the work and as to the requirements of the plans, specifications, supplemental specifications, special provisions, and contract.
The plaintiff in this case was thus made responsible for assuring himself of the quality of the material which he was required to supply to fulfill the job.
In the second place, the state employee, Mr. Mitchell, merely stated that the Utelite pit was available and could be used for borrow; he did not state that it met the State’s specifications. Thus, even if the law were that the erroneous verbal representations of a low level state employee were deemed to be warranted by the state, no such positive representation can be found in this case. The findings of fact by the trial court in this regard clearly support that conclusion. They are set out in the margin.1
Finally, if this Court intends to extend the rule of warranty as to representations in written plans and specifications to include verbal representations by low level state employees, it ought to do so explicitly and not sub silentio.
For the foregoing reasons, I dissent as to that portion of the majority opinion which permits recovery for the increased expenses associated with acquiring a new source for borrow material.
I concur with respect to the remainder of the majority opinion.
*373CROCKETT, C. J., concurs with the views expressed in the opinion of STEWART, J.

. 4. Mr. Mitchell, accompanied by Thom’s representatives, drove to a potential source of borrow material known as the “Utelite” property. Mr. Mitchell stated to representatives of Thorn that material from the Utelite pit was available for use as borrow in connection with the highway construction project. Virgil Mitchell had no training or experience with the Utah Department of Transportation or its predecessor, Utah State Department of Highways, in the area of materials or testing of materials. Mr. Mitchell further did not know of any material from the Utelite pit ever having been used in highway construction. He likewise did not know of any tests of said material as to suitability for borrow, and further had never discussed the Utelite property with the State’s Engineer, Ed Watson, as a possible borrow source prior to showing this source to Thom Construction Company personnel.
5. Relying on the representations of Mr. Mitchell, Thorn entered its bid in connection with the Wanship highway construction project and calculated the bid item of borrow on the basis of Mr. Mitchell’s representations that the material from the Utelite pit could be used as borrow on the construction project.