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04/27/94 QUALITY GRANITE CONSTRUCTION CO. v.

April 27, 1994

QUALITY GRANITE CONSTRUCTION CO., INC., AND VINCENT MARSALA, PLAINTIFFS-APPELLEES,
v.
HURST-ROSCHE ENGINEERS, INC., AND K. DEAN MCILRAVY, DEFENDANTS-APPELLANTS.



Appeal from the Circuit Court of Madison County. No. 90-L-67. Honorable George J. Moran, Jr., Presiding Judge.

Petition for Leave to Appeal Denied October 6, 1994.

Maag, Welch, Chapman

The opinion of the court was delivered by: Maag

JUSTICE MAAG delivered the opinion of the court:

This is a defamation case which arose from a construction project performed for the St. Clair County Housing Authority (Housing Authority). In order to fully understand the background in which this case is presented, we must first identify the entities involved. Defendant Hurst-Rosche Engineers, Inc. (HRE), is an engineering firm hired to design and supervise construction; K. Dean McIlravy is general manager for HRE in the metro-east area; plaintiff, Quality Granite Construction Company, Inc. (Quality), is the general contractor hired to perform the work specified by HRE's design; Vincent Marsala is the president of Quality Granite; and Transamerica Premier Insurance Company (Transamerica) is a bonding company which issued a "performance bond" guaranteeing Quality's work.

HRE contracted with the Housing Authority to prepare plans for a 22-building apartment complex. As a part of the contract, HRE was required to conduct weekly inspections of the work and report any findings to the Housing Authority. In particular, the contract specified that HRE on a weekly basis was to "advise as to whether or not the work is compliant with job plans and specifications," report any "deficiencies observed," and advise as to "the approximate completion status" at the time the inspection was made.

Given the fact that Quality was the general contractor, it was their work which was being inspected and evaluated regularly by HRE. There is apparently no dispute between the parties with respect to these facts. Rather, the crux of this case involves a comparison between the weekly reports and a letter dated September 12, 1989, that was sent by HRE to Transamerica. This letter stated that Quality "may be considered in default " (emphasis in original), due to "the contractors' failure to complete the project in a timely manner, substandard workmanship, reluctance to complete punch list items and inability to interpret the contract documents, plans and specifications as bid."

Quality and Marsala presented evidence that indicated that HRE had certified the project to the owner as 100% complete and satisfactorily done several months before the September 12, 1989, letter. According to the plaintiffs, the letter at issue was sent to "pressure" Quality into agreeing to compromise claims for additional compensation under their contract. They claim that after the offending letter was sent, Transamerica suspended their bonding temporarily. Later, when Quality was again able to get bonding, itwas only on a limited basis and then only on projects of $500,000 or less. According to Quality and Marsala the letter was the cause of these difficulties. As a consequence, Quality and Marsala filed this suit.

The parties argue at length about the Conclusions that should be drawn from the evidence presented. It is not our function as a reviewing court to reweigh the evidence. The rule we must apply in considering the evidence is as follows:

"An initial step in analyzing the issue before us is to determine the authority of the jury, trial court, and appellate court, and their relationship to one another. Unquestionably, it is the province of the jury to resolve conflicts in the evidence, to pass upon the credibility of the witnesses, and to decide what weight should be given to the witnesses' testimony. [Citation.] A trial court cannot reweigh the evidence and set aside a verdict merely because the jury could have drawn different inferences or Conclusions, or because the court feels that other results are more reasonable. [Citations.] Likewise, the appellate court should not usurp the function of the jury and substitute its judgment on questions of fact fairly submitted, tried, and determined from the evidence which did not greatly preponderate either way." Maple v. Gustafson (1992), 151 Ill. 2d 445, 452-53, 603 N.E.2d 508, 511-12.

We are compelled to view all the evidence and inferences therefrom in the light most favorable to the verdict winner. Heimberger v. Village of Chebanse (1984), 124 Ill. App. 3d 310, 314, 463 N.E.2d 1368, 1371.

HRE and McIlravy claim the "evidence presented at trial regarding the scope and performance of Quality's work was directly contradictory." We agree it was conflicting. However, we decline this invitation to reevaluate and resolve these conflicts. The jury has already done so. We, therefore, will consider the evidence only in the light most favorable to Quality and Marsala, the verdict winners.

With these standards in mind, we can summarize the evidence by stating that Quality and Marsala submitted reports and testimony for the jury to consider that indicated that they had complied with the plans and specifications prepared by HRE and that the workmanship met acceptable standards. HRE and McIlravy disputed this evidence; however, the jury resolved the issue against them, and we must therefore conclude that Quality complied with its contract.

HRE and McIlravy claim that an evaluative report of a supervising professional on a construction project can never be the basis of a libel claim. They base this contention on the argument that as a matter of custom, contract, and sound public policy such professionals are required to evaluate and report on a contractor'swork. In their words, "If the law allowed a contractor to recover damages for libel as a result of an engineer's notification to the owner and bonding company of potential problems with the contractor's work, then engineers would be precluded from performing an essential aspect of their professional duties." According to HRE and McIlravy, the case of Vee See Construction Co. v. Jensen & Halstead, Ltd. (1979), 79 Ill. App. 3d 1084, 399 N.E.2d 278, recognized this blanket immunity from liability. We disagree.

Vee See granted no such immunity. That case simply applied the innocent construction rule as it then existed to a supervising architect's letter mailed to the contractor and several other persons. This letter alleged that only two coats of paint, rather than three as required by the contract, were being applied. The court in Vee See held that rather than imputing dishonesty, the letter could be innocently construed as an attempt to resolve a misunderstanding. Therefore, the trial court's dismissal of the libel action was affirmed. We have no disagreement with the holding in Vee See under the state of the law in existence at the time of the decision. But that decision certainly did not grant a blanket immunity from liability in a libel suit either under the facts of that case or the case at bar.

HRE & McIlravy next claim that statements in the September 12, 1989, letter were capable of being construed innocently and are nonactionable as a matter of law. Citing John v. Tribune Co. (1962), 24 Ill. 2d 437, 181 N.E.2d 105, and Chapski v. Copley Press (1982), 92 Ill. 2d 344, 442 N.E.2d 195, they also argue that the statements at issue should be read as an expression of opinion ...


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