Court Opinion

ID: 9696058
Source: CourtListenerOpinion
Date Created: 2023-08-25 18:34:46.871392+00
Date Added: 2024-06-11T18:20:18.130683
License: Public Domain

OPINION OF AUGUST 10, 1973.
TEIGEN, Justice
(on rehearing).
Following the issuance of an opinion with one dissent, we granted a rehearing in this case. After the reargument a majority of this court have agreed that the opinion previously issued should be modified in two important respects.
We do not agree that the City is limited to recover damages by the number of feet of deficiencies in curb and gutter and eight other listed items discovered within one year of the completion of the project. In other respects, we agree with the opinion as originally issued. Judge Erickstad, who authored the first opinion, has decided to file his opinion as his dissent. We therefore adopt his dissent as to the facts and affirm the issues decided therein, with the following exceptions:
1. We do not agree that the trial court erred in awarding the cost of repairing “deficiencies” discovered after the expiration of the one-year warranty period. We believe and conclude that all injuries sustained by the City in this case are attributable to one defect in workmanship: the failure to compact backfilled trenches to 95% of Proctor. The City gave timely notice of this defect to Drake-Henne. Thus the City passed to the contractor [Drake-Henne] the duty to discover how much of its work was affected by this single defect and to correct that defect or, upon its failure to do so, to respond in damages to the City.
2. Upon Drake-Henne’s failure to correct the defective compaction, we hold that it must answer in damages for the cost of repairing all resulting defects which were fairly, reasonably and directly attributable to the failure to compact, proved at the trial.
The workmanship was defective in that Drake-Henne had failed to compact the soil in the trenches in accordance with the requirements of the contract. This resulted in a settling of the soil and the resulting damage to the curb and gutter, pavement and other improvements. The failure to compact was discovered within the one-year period following completion of the project and Drake-Henne was advised thereof in writing. Further, Drake-Henne acknowledged its obligation under the warranty clause when, in July 1964, it attempted to correct the defective workmanship by employing a short-cut method, known as “mudjacking”, to raise the displaced curb and gutter in place, but the attempt failed and, on the following day, it discontinued this work and no further attempts *900were made to remedy the defective workmanship. It is our opinion that the city of Wahpeton satisfied its .requirements of the warranty clause when it discovered and notified Drake-Henne, in writing, of the defective workmanship within one year after completion of the project. It then became the duty of Drake-Henne, under the warranty clause, to carry out its terms.
We find that the failure to compact to 95% of Proctor, as required by the specifications, is the causal defect and the proximate cause of the resulting defects, also referred to as “deficiencies”, to wit, the settling of the curb and gutter, pavement and other improvements placed over and resting upon the insufficiently compacted soil within the trenches. The settling of the curb and gutter, pavement and other improvements located over the insufficiently compacted trenches are consequential damages, or resulting defects, which are referred to as “deficiencies” in a portion of the dissent. These deficiencies may be fairly and reasonably attributed to the single “causal defect”, to wit, the failure to compact the trenches to 95% of Proctor. We believe that Drake-Henne is responsible for all consequential damages proved at the trial which may be fairly and reasonably attributed to the single causal defect, where, as here, notice of that causal defect was given within the one-year warranty period. The deficiency of compaction (the causal defect) is a latent defect which continued to manifest itself as time passed, even after the one-year period specified in the warranty clause, by the continuing settlement of curb and gutter, pavement, alley returns, storm sewers, catch basins, driveways and berm overlying the improperly compacted trenches and, it appears, was still manifesting itself at the time of trial. Drake-Henne was notified of the defect within one year after completion of the project, thus activating the warranty clause for all consequential damages (resulting defects) proved at the trial. There is no claim that these overlying improvements were defectively constructed and it is evident that had the trenches been compacted to within 95% of Proctor, as required by the specifications, the overlying improvements would not have settled or become disturbed. Thus, admittedly, there is but a single “causal defect”, i. e., failure to compact to 95% of Proctor. Drake-Henne must be held responsible for the improper workmanship and the resulting defects or deficiencies directly resulting from its failure to perform.
The warranty clause of the contract provides that the contractor shall remedy defective workmanship within thirty days after notice in writing of the existence thereof shall have been given by the owner and “in the event of failure by the Contractor to do so, the Owner may remedy such defective workmanship * * * and in such event the Contractor shall pay the Owner the cost and expense thereof.” This is in harmony with the measure of damages for breach of contract as provided by Section 324)3-09, N.D.C.C.:
“For the breach of an obligation arising from contract, the measure of damages, except when otherwise expressly provided by the laws of this state, is the amount which will compensate the party aggrieved for all the detriment proximately caused thereby or which in the ordinary course of things would be likely to result therefrom. No damages can be recovered for a breach of contract if they are not clearly ascertainable in both their nature and origin.”
Thus we affirm the trial court’s judgment which, in respect to this issue, provides :
“The preponderance of the evidence establishes that the defendant contractor’s compaction was deficient and did not meet specification requirements with resulting damage to pavement, curb and gutter, and other incidental items.
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“The defendant Drake-Henne’s breach of contract for failure to meet contract specification requirements was a proximate cause of the failure of pavement, *901curb and gutter and resultant damage under consideration in this case.
* * * * * *
“Compaction here was a latent defect, acceptance of which by the City does not preclude or estop the City from pressing its claim against the defendants.
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“It is held that damages to be awarded the plaintiff is the amount which will compensate the plaintiff City for all detriment proximately caused by defendant Drake-Henne’s default or which in the ordinary course of things will be likely to result therefrom.”
We come now to the question of amount of damages. The trial court allowed the sum of $58,367.30. The City specifies that these damages are inadequate.
Several experts testified at the trial concerning the extent of the defect, and also concerning the cost of repair and restoration. The evidence establishes that 34,048 feet of trench is required to be disturbed and recompacted which runs parallel to and has caused curb and gutter to settle and become disturbed. One expert testified it would cost $12.20 per lineal foot to correct these defects, whereas another expert testified the cost would be $9.85 per lineal foot. It was also established that 16,082 feet of trench in the street over which pavement had been placed had become disturbed. One expert testified it would cost $15.-13 per lineal foot and the other testified it would cost $10.80 per lineal foot to correct this defect. The evidence also reveals that there are 2,026 feet of insufficiently compacted trenches in the boulevard which do not affect curb and gutter. According to one expert it would cost $4.10 per lineal foot to correct this defect; the other expert testified that the cost would be $3.20 per lineal foot. Based on these computations and accepting the lower estimates of cost to correct the defects, which cost figures were produced by one of the witnesses for the plaintiff, the damages to the City, proximately caused by failure of compaction, total $515,541.60.
We also allow as additional damages the amount of $2,250, allowed in the original opinion filed herein as a dissent, for items numbered 1, 2, 4 and 6 described in plaintiff’s Exhibit HHH, but disallow damages for items numbered 3, 5, 7 and 8 for the reason that the plaintiff has failed to produce proof of damages as to these items. The items for which damages are allowed do not appear to have been caused by failure of compaction of the trenches containing the sewer or water mains.
For the reasons set forth herein we affirm the judgment of the trial court on the issue of liability and modify it as to the amount of damages awarded to the City, and direct that judgment be entered in favor of the City in the amount of $517,791.60, plus interest at the legal rate of four per cent per annum from and after the entry of judgment on mandate.
VOGEL and KNUDSON, JJ., concur.