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Horton Ind., Inc. v. Village of Moweaqua





Appeal from the Circuit Court of Shelby County; the Hon. Paul M. Hickman, Judge, presiding.


Defendants, village of Moweaqua and the Illinois Environmental Protection Agency (IEPA), an intervening defendant, have perfected this appeal from a judgment entered in the circuit court of Shelby County in a jury trial in which defendant village was found to have committed a breach of its sewer construction contract with plaintiff, Horton Industrial, Inc. The facts are as follows:

During the spring of 1977, the defendant village requested bids upon a proposed sewage collection system which was being partially funded by defendant IEPA. Of the four contractors bidding upon this project, the low bid of $1,288,132.30 was submitted by plaintiff, which at the time was doing business as Lord & Rowe, Inc. After the village accepted plaintiff's bid, the village and plaintiff entered into a contract consisting of the following relevant provisions:

"SCOPE. Division B (Sewage Collection System) herein described as specified is the first proposed complete sanitary sewer system for Moweaqua, Illinois. It will replace the many septic tanks, cesspools, underground leaching areas, field tiles, drains and storm sewers serving as outlets for the partially treated domestic sewage, etc.

The entire risk as to the nature of any and all subsurface material characteristics encountered at the various levels is that of the Bidder. No additional compensation is available. The Bidder's claims for additional compensation due to encountering subsurface conditions different than that expected will be denied. The only exception to the above is material which could be classified as `Rock Excavation.' None is expected at Moweaqua.

The plans show the general alignment of the various underground utility lines, existing drains and storm conduits based on the information available, approximate location picked up during field surveys and data from the private utility companies and Village records. They cover a very large percentage of underground utility lines and conduits. Bidders will be required to locate other underground utilities by any other available means during construction.

The location of any field tile, underground conduit, buried cables, if any not shown on the Plans [Exhibit E1] shall be called to the attention of the Engineer. All such facilities, if damaged, shall be restored, and approved by the Engineer before backfilling the location. No extra compensation will be allowed for this work or for delays occasioned by it.

Any discrepancies found between the DRAWINGS and SPECIFICATIONS and site conditions or any inconsistencies or ambiguities in the DRAWINGS or SPECIFICATIONS shall be immediately reported to the ENGINEER, in writing, who shall promptly correct such inconsistencies or ambiguities in writing. WORK done by the CONTRACTOR after his discovery of such discrepancies, inconsistencies or ambiguities shall be done at the CONTRACTOR'S risk.

The OWNER shall furnish all land surveys and establish all base lines for locating the principal component parts of the WORK together with a suitable number of bench marks adjacent to the WORK as shown in the CONTRACT DOCUMENTS.

The ENGINEER shall act as the OWNER'S representative during the construction period. He shall decide questions which may arise as to quality and acceptability of materials furnished and WORK performed. He shall interpret the intent of the CONTRACT DOCUMENTS in a fair and unbiased manner. The ENGINEER will make visits to the site and determine if the WORK is proceeding in accordance with the CONTRACT DOCUMENTS.

The CONTRACTOR will be held strictly to the intent of the CONTRACT DOCUMENTS in regard to the quality of materials, workmanship and execution of the WORK.

Wherever obstructions are encountered during the progress of the work and interfere to such an extent that an alteration in the plan is required, the Engineer shall have the authority to change the plans and order a deviation from the line and grade or arrange with the owners of the structures for the removal, relocation or reconstruction of the obstructions. Where gas, water, telephone, electrical, hot water, steam or other existing utilities are an impediment to the vertical or horizontal alignment of the proposed pipe line, the Engineer shall order a change in grade or alignment or shall direct the Contractor to arrange with the owners of the utilities for their removal. If a change in line or grade of a sanitary sewer is necessary, the Engineer will order the addition of any manholes needed to comply with the Environmental Protection Agency regulations.

If, through no act or fault of the CONTRACTOR, * * * the ENGINEER fails to act on any request for payment within thirty (30) days after it is submitted, * * * then the CONTRACTOR may, after ten (10) days from delivery of a WRITTEN NOTICE to the OWNER and the ENGINEER, terminate the CONTRACT and recover from the OWNER payment for all WORK executed and all expenses sustained. * * *

At least ten days before each progress payment falls due (but not more often than once a month), the CONTRACTOR will submit to the ENGINEER a partial payment estimate filled out and signed by the CONTRACTOR covering the WORK performed during the period covered by the partial payment estimate and supported by such data as the ENGINEER may reasonably require. If payment is requested on the basis of materials and equipment not incorporated in the WORK but delivered and suitably stored at or near the site, the partial payment estimate shall also be accompanied by such supporting data, satisfactory to the OWNER, as will establish the OWNER'S title to the material and equipment and protect his interest therein, including applicable insurance. The ENGINEER will, within ten days after receipt of each partial payment estimate, either indicate in ...

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