CORBIN GLASS COMPANY v. DENHAM-BLYTHE, INC.

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RENDERED: January 15, 1999; 10:00 a.m. NOT TO BE PUBLISHED C ommonwealth O f K entucky C ourt O f A ppeals NO. NO. 1997-CA-001140-MR 1997-CA-001198-MR CORBIN GLASS COMPANY v. APPELLANT/ CROSS-APPELLEE APPEAL AND CROSS-APPEAL FROM LAUREL CIRCUIT COURT HONORABLE RODERICK MESSER, JUDGE ACTION NO. 96-CI-286 DENHAM-BLYTHE, INC. APPELLEE/ CROSS-APPELLANT OPINION AFFIRMING ** ** ** ** ** BEFORE: BUCKINGHAM, DYCHE AND GARDNER, JUDGES. GARDNER, JUDGE: Corbin Glass Company (Corbin) has appealed from a judgment of the Laurel Circuit Court in this contractor/ subcontractor dispute stemming from a construction project. Denham-Blythe, Incorporated (Denham) has cross-appealed. After reviewing the issues raised by both parties, this Court affirms the circuit court’s judgment. This action arises from a project to build a psychiatric addition to the Appalachian Regional Hospital (Appalachian) in Hazard, Kentucky. Denham was the general contractor for the project, and it entered into a contract with Corbin by which Corbin agreed to furnish and install certain glass and glazing for the project. work at a cost of $375,080. Corbin agreed to perform the Corbin subcontracted with Atlas Metals (Atlas) to provide screens for the project. Appalachian, a non-profit entity, reserved the right to pay any material suppliers directly, thus enabling it to save the applicable Kentucky sales tax. During the course of the project, a problem arose regarding the screens that Atlas furnished for the project. The screens had the wrong finish and also were sized incorrectly and thus, would not fit.1 Appalachian and Denham discussed the matter with Atlas and determined that the best course was for Atlas to correct the size of the screens at an additional cost of $14,126. Corbin has maintained that it was not consulted regarding this matter and that it should not be forced to bear the additional cost. The screens were corrected and eventually installed on the new addition. Over the course of the project, Corbin invoiced Denham $156,605 which Denham paid. Following completion of the project, Denham requested Corbin to sign a release whereby Corbin acknowledged receipt of all sums due to it and released any claim it might have had to a lien on the project. release. Corbin signed this Sometime after this release was signed, Denham 1 A dispute apparently exists regarding who provided the incorrect measurements for the screens. Denham maintains that Corbin provided incorrect specifications while Corbin contends it was not given a timely opportunity to provide Atlas with the correct dimensions prior to the delivery of the screens. -2- contended that it overpaid Corbin $22,995.56, and demanded Corbin refund that amount. Corbin declined to refund any money to Denham. In April 1996, Denham filed a complaint in circuit court seeking to recover $22,995.56 plus interest from Corbin. The court conducted a bench trial, and in March 1997 issued its findings of fact, conclusions of law and judgment. The court found that Denham overpaid $14,126 for the cost of resizing the screens and that payments to Corbin included an overpayment of $492.36 in sales tax. It found that another $2,080.00 paid to Corbin by Denham regarding materials provided by Kawneer, another subcontractor under Corbin, did not constitute an overpayment. The court concluded as a matter of law that the release signed by Corbin barred its counterclaim. The court awarded Denham $14,618.36 which constituted overpayments it made to Corbin. Corbin subsequently moved the court to alter, amend or vacate its previous judgment. Corbin specifically asked the court to reconsider its award of $492.36 in overpayment of taxes. It also moved the court to make additional findings of fact regarding whether the additional $14,126 paid to Atlas by Denham was with or without the consent of Corbin and if made without Corbin’s consent, Corbin asked the court to make a finding regarding whether Denham knew Corbin did not consent to the overpayment. It also asked that if the court found that the overpayment was made without Corbin’s consent, that the court state what provision of the contract between Denham and Corbin or what legal authority permitted Denham to recover the overpayment -3- from Corbin. The court in an April 1997 order, granted the motion to alter, amend or vacate and reduced the judgment by $492.36. fact. It denied the motion to make additional findings of Corbin subsequently brought this appeal, and Denham cross- appealed. Corbin argues that the trial court erred by allowing Denham to recover for an overpayment to Atlas. Corbin maintains that it was left out of the negotiating between Appalachian, Denham and Atlas regarding how to correct the problem of the nonconforming screens. It thus contends that it was not allowed to correct or minimize damages with Atlas, a company with which it had subcontracted. It also argues that the trial court erred by holding that the release signed by it barred its counterclaim and that Denham should have told Corbin at the time Corbin signed the release that Denham planned to recover additional amounts. After reviewing the agreement signed between Denham and Corbin and the trial court’s findings in this case, this Court affirms the trial court on this issue. Two provisions of the agreement signed by Denham and Corbin are particularly relevant to the dispute in the instant case. The agreement on page one states, THE INSTALLATION OF THE MATERIALS OR THE WORK TO BE PERFORMED SHALL BE DONE WHEN AND AS REQUIRED TO MEET JOB PROGRESS REQUIREMENTS, OR AS DIRECTED BY THE CONTRACTOR. IF THE MATERIALS HEREIN CALLED FOR ARE NOT DELIVERED PROMPTLY, THEREBY CAUSING OR THREATENING TO CAUSE DELAY IN THE GENERAL PROGRESS OF THE WORK, THE CONTRACTOR SHALL HAVE THE RIGHT TO INVESTIGATE THE CAUSE OF SAID DELAY AND EXPEDITE DELIVERIES, AND ALL EXPENSES THUS INCURRED BY THE CONTRACTOR SHALL BE CHARGED TO AND PAID BY THE SAID SUBCONTRACTOR. -4- On page two it states, SUBCONTRACTOR SHALL INDEMNIFY AND HOLD HARMLESS THE CONTRACTOR FROM AND AGAINST ANY AND ALL PAYMENTS AND LIABILITIES FOR PAYMENT OF COMPENSATION OR DAMAGES WHICH THE CONTRACTOR MAY BE REQUIRED OR OBLIGATED TO MAKE TO OR ON ACCOUNT OF SUBCONTRACTOR’S OWN EMPLOYEES, AND ALSO INDEMNIFY AND HOLD HARMLESS THE CONTRACTOR FROM AND AGAINST ANY AND ALL LOSSES, LIABILITIES, SUITS OR OBLIGATIONS OF ANY KIND, PAID OR INCURRED BY THE CONTRACTOR ON ACCOUNT OF THE ACT, NEGLECT OR DEFAULT OF THE SUBCONTRACTOR, ITS AGENTS, SERVANTS, EMPLOYEES OR SUBCONTRACTORS NOTWITHSTANDING THAT ANY ACT, NEGLECT OR DEFAULT OF CONTRACTOR MAY HAVE CONTRIBUTED THERETO. The language of this agreement is clear and unambiguous. Under these provisions, Corbin bears the burden of absorbing the extra cost of damage done by its subcontractor, even if Denham, the general contractor, may have contributed to the problem through its own fault. The key problem that arose in this case is that once Atlas delivered the nonconforming screens, Corbin was basically left out of the negotiations with Atlas to correct the problem. Appalachian and Denham apparently decided that the quickest and least expensive way to remedy the problem was for Atlas to correct the screens at an extra cost of $14,126. This fact does render the matter of who supplied the wrong specifications to Atlas more relevant, and the evidence was apparently disputed on this issue. The trial court made no definite finding on this issue but in deciding for Denham, it apparently concluded that Corbin was at fault and must bear the burden. Corbin requested no specific findings of fact on this issue so it has essentially waived any contention on this matter. -5- See Eaton Axle Corp. v. Nally, Ky., 688 S.W.2d 334, 338 (1985); Cherry v. Cherry, Ky., 634 S.W.2d 423, 426 (1982); Kentucky Rules of Civil Procedure (CR) 52.02, 52.04. Further, Corbin has cited nothing in the record which renders the trial court’s findings of fact clearly erroneous, and we decline to disturb the trial court’s findings of fact in this matter. See Reichle v. Reichle, Ky., 719 S.W.2d 442 (1986); Cherry v. Cherry, 634 S.W.2d at 425; Wells v. Wells, Ky., 412 S.W.2d 568 (1967); Byerly Motors, Inc. v. Phillips Petroleum Co., Ky., 346 S.W.2d 762 (1961); CR 52.01. Based upon the original agreement between Denham and Corbin and the trial court’s findings of fact, this Court declines to disturb the trial court’s conclusion that Corbin must repay Denham the $14,126 for resizing the screens.2 The cases cited by Corbin regarding mistake are fundamentally distinguishable and do not apply to this case. Corbin also seems to dispute the trial court’s findings regarding $2,080 to which it claimed it was entitled based upon its subcontract with Kawneer and $492.36 in sales tax which it claims was erroneously awarded to Denham. The record shows that the trial court ruled in favor of Corbin in both instances. The court concluded that the $2,080 was the result of Corbin’s agreement to do certain work at its shop so it did not appear 2 We do not believe that the release signed by Corbin at Denham’s insistence has any bearing on this particular issue since Corbin had already been paid this amount at the time that it signed the release. We also note that Corbin may have some remedy against Atlas, but for some reason neither party brought any claim against Atlas in the proceedings below. -6- Corbin was overpaid.3 Further, while the trial court initially ruled that the payments to Corbin included an overpayment in sales tax of $492.36, in its subsequent order of April 21, 1997, it granted Corbin’s motion to alter, amend or vacate to the extent that the judgment was reduced by $492.36. In its cross-appeal, Denham argues that the trial court erred in not awarding the total overpayment to Corbin of $22,995. Thus, it argues it should have been awarded an additional $8,869. We have uncovered no error by the trial court on this issue. The record reveals that a dispute existed regarding whether certain glazing, glass installation, and other work to be done to a connector building at the project was included in the original bid packages three or four, or included later in change order A. Corbin’s witnesses testified that extra work had to be done for additional material and labor costs which were apparently part of change order A. Denham’s witness however stated that bid package four was included in change order A and that no extra costs were incurred. The record contains ample evidence to support the trial court’s conclusion that Denham was not entitled to any extra amount and we decline to disturb its findings. See Reichle v. Reichle, 719 S.W.2d at 444. For the foregoing reasons, this Court affirms the judgment of the Laurel Circuit Court. ALL CONCUR. 3 It also appears that any claims for Corbin for additional amounts from Denham after it was initially paid would be barred by the release it signed. -7- BRIEF FOR APPELLANT/CROSSAPPELLEE: BRIEF FOR APPELLEE/CROSSAPPELLANT: Larry E. Conley Corbin, Kentucky Richard E. Vimont Lexington, Kentucky -8-

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