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Consumers Const. Co. v. County of Cook

OCTOBER 4, 1971.




APPEAL from the Circuit Court of Cook County; the Hon. DAVID A. CANEL, Judge, presiding.


Consumers Construction Company (plaintiff) brought this action for damages based upon a written building contract with the County of Cook, a municipal corporation (defendant). The case was heard without a jury. At the close of all the evidence, the trial judge entered a finding and judgment for defendant. Plaintiff appeals.

The basic question raised by plaintiff is whether a cause of action exists in favor of a contractor in a public building contract for delays allegedly caused by defendant as owner. As a subsidiary contention, plaintiff claims that the trial judge erred in excluding competent evidence. Defendant contends that the provisions in the contract governing time of performance are exclusively for the benefit of defendant as owner and that the rulings of the court on evidentiary questions were proper. A factual statement is required. We will attempt to distinguish between agreed and controverted facts.

Defendant solicited bids for a written contract for additions and alterations to Cook County Children's Hospital in the City of Chicago. Thereafter, and on January 15, 1962, the parties entered into a brief written contract. This agreement incorporated therein by reference the advertisement of defendant for bids, the proposal made by plaintiff, the detailed specifications prepared by defendant prior to the taking of bids, all drawings and all other documents on file in the office of the purchasing agent of defendant. The total contract price was fixed at $531,900. The work was to be completed within 210 calendar days from execution of the contract. It was specified that time was of the essence of the contract. The specifications in question are a massive document containing hundreds of pages. It is unnecessary to attempt to summarize all of the detailed provisions. We shall later point out certain essential particulars contained in this document.

Prior to the signing of the contract, defendant issued certain addenda which revised the specifications. The first addendum, dated December 7, 1961, set up a schedule of the various phases in completion of the job. Plaintiff examined all of these matters and the site itself prior to execution of the contract. Plaintiff was familiar with the first addendum when it entered its bid on the job. On January 29, 1962, a meeting at the job site was held between representatives of plaintiff and the architect for defendant. At that time, the architect was furnished with time schedules reflecting completion within the specified time limit and with an outline of the order in which the work was to be accomplished. No exception was ever taken by the architects to these matters.

It is agreed that, as the work progressed, various extras were requested by defendant or its representatives. It is also agreed that this extra work took up approximately 473 days; more than double the originally agreed time for the total work. Defendant paid for these extras in full in addition to the original contract price. In each case, these extras were approved by the purchasing agent of defendant as provided in the specifications. These extras have no bearing upon plaintiff's claim for damages. It is also agreed that the contract price was paid in full. It is undisputed that plaintiff did not complete the construction work until 972 days after signing of the contract. After deducting days expended on the extra work, calculation shows additional delays of 289 days.

The basic factual disagreement between these parties is whether these delays were caused by defendant. Defendant takes the position that, "* * * the record is barren of any direct evidence which would substantiate * * *" the contention that delays were caused by defendant or its architect. Plaintiff takes the position that it produced ample evidence to justify its contention of culpability of defendant but was prevented from doing so by erroneous rulings of the trial court. We will first attempt to resolve this conflict.

Plaintiff offered in evidence a large number of daily progress reports in an attempt to prove that the delays were caused by defendant. The contract between the parties provided that plaintiff was to prepare written progress reports every day, copies of which were to be delivered to the architect. (Specifications, Division 2, page 119, par. 130B.) The evidence is uncontradicted that plaintiff's superintendent prepared and gave copies of these reports to the architect every day in compliance with the contract. The reports were personally delivered to the architect's office. Notice to produce these reports was served upon defendant and the retained copies in the possession of plaintiff were offered in evidence. The trial court sustained objection by defendant to these exhibits and rejected them. The theory of the court apparently was that the architect was not a general agent of defendant and had no right to modify the written agreement between the parties.

• 1-3 In our opinion, this ruling was erroneous. The issues of modification of the contract or general authority of the architect have no materiality here. The written contract between the parties specifically made provision for the preparation of these exhibits by plaintiff and for delivery of them to the architect. This made the architect the agent of defendant for the purpose of receiving the progress reports which were essential to discharge of the architect's duties and proper supervision of the project. Moreover, the basic modern approach to competency of evidence starts from the premise that all evidence is competent until the reverse be shown. The proof shows that these documents were kept in the ordinary course of business in performance of the contract. They were made pursuant to a specific requirement of the contract. This qualified them for admission as business records within the scope of Rule 236 of the Supreme Court of Illinois. (43 Ill.2d Rule 236(a).) The progress of the law of evidence from the early portion of the 17th century to this enlightened rule is set forth in the Committee comments pertaining to the rule.

This exclusionary ruling by the trial court deprived plaintiff of a fair opportunity of proving the factual essence of its claim; namely, that the delays were caused by defendant. For this reason, we are obliged to reverse the judgment and to remand the cause for a new trial so that the trial court can examine properly the reasons for the admitted delays. It is unnecessary for us to consider additional arguments advanced by plaintiff concerning other rulings by the trial court on evidence offered. As a guide to counsel and the court in future proceedings, we will state our opinion with reference to the legal issues raised in this appeal.

A question first arises regarding the written agreement. As above pointed out, the contract document signed by the parties stated, "work to be completed within 210 calendar days from date of signing of contract." The agreement also provided, "* * * that time shall be of the essence of this contract * * *." At the trial and in its brief here, defendant contends that provisions in a building contract requiring completion of the subject matter of the contract within a specified time are for the sole benefit of the owner and consequently may not be depended upon or used by plaintiff for any purpose whatsoever. The trial court agreed with this contention and therefore concluded that the lengthy delays in completion of the contract gave plaintiff no right to recover damages even if these delays were caused solely by the agents of the defendant or by third parties.

The only authority which lends credence to the major premise upon which this conclusion is based is Adam Groth & Co. v. Goss & Guise, 232 Ill. App. 450, decided by this court in 1924. That case involved a suit by a general contractor against a subcontractor in connection with school district construction. The contract provided for substantial completion "within 140 working days * * * Sundays and holidays excepted." There were various delays and defendant refused to perform the subcontract on the ground that 140 working days had then elapsed. Concerning the time limitation, this court stated (232 Ill. App. 450 at 454):

"Furthermore, this provision was for the benefit of the owner and architect and could be waived by them as it is claimed was done in this case."

• 4, 5 The court held that it was erroneous to direct a verdict in favor of the subcontractor and the case was remanded for another trial. We cannot regard Adam Groth & Co. as authority which supports the sweeping generalization advanced by defendant. The statement of the court must be considered in its application to the specific facts in the case. There, the reason for the delay was a work stoppage necessitated by freezing weather. The facts in the case at bar are completely different. Plaintiff here claims that inordinate delays which were costly and unfair to plaintiff were caused by conduct of defendant as owner. A generalization such as that advanced by plaintiff cannot be applied inflexibly to every case. All of the language in every contract represents the intention of both parties as solemnly reduced to writing. Each word of every written contract must be deemed applicable to both parties and must be carefully considered to arrive at a just and equitable result. The issue here is not the narrow one as to which party is to benefit by any particular language ...

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