SCAFAR CONTRACTING, INC v. CITY OF NEWARK
Annotate this CaseNOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-1726-19
SCAFAR CONTRACTING, INC.,
Plaintiff-Appellant,
v.
CITY OF NEWARK,
Defendant/Third-Party
Plaintiff-Respondent,
v.
MALCOM PIRNIE, INC.,
a/k/a ARCADIS U.S., INC.,
Third-Party Defendant.
______________________________
Argued October 4, 2021 – Decided March 29, 2022
Before Judges Messano, Rose, and Enright.
On appeal from the Superior Court of New Jersey, Law
Division, Essex County, Docket No. L-6951-14.
Shawn R. Farrell argued the cause for appellant (Cohen
Seglias Pallas Greenhall & Furman, PC, attorneys;
Shawn R. Farrell, Jennifer R. Budd, and Gary J. Repke,
Jr., on the briefs).
Morrison Kent Fairbairn argued the cause for
respondent (Michael A. Armstrong & Associates, LLC,
attorneys; Michael A. Armstrong and Morrison Kent
Fairbairn, on the brief).
PER CURIAM
Plaintiff Scafar Contracting, Inc., submitted the lowest bid in response to
the City of Newark's request for bids (RFB) to construct a "Combined Sewer
Overflow" facility on .46 acres of open space at Clay Street, adjacent to the
Passaic River. The RFB's scope of work included the removal of an estimated
7,000 tons of non-hazardous soil and 10,000 tons of hazardous soil, and bidders
were required to submit per unit prices for each category of soil to be removed.
Plaintiff's bid was $9,987,834, based on quoted prices of $22/ton of non-
hazardous soil, and $123/ton for hazardous soil. The City accepted the bid, and
the parties executed a contract for that amount, which incorporated, with
exceptions we note below, the terms, conditions, specifications and other
information provided in the RFB.
Plaintiff completed the work, but disputes arose during its performance of
the contract, with plaintiff claiming that the City had superior knowledge of the
actual conditions of the soils which plaintiff was required to excavate and
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dispose of and failed to disclose these conditions. Plaintiff asserted the technical
reports made available at the time of the bid failed to disclose the actual
conditions at the site. As a result, plaintiff claimed its costs for installing a
cofferdam at the site and testing and disposing of the excavated material greatly
increased and generated delays that increased plaintiff's expenses in performing
the contract. Plaintiff filed a complaint against the City alleging breach of
contract, unjust enrichment, or alternatively, quantum meruit, and violation of
the Prompt Payment Act (PPA), N.J.S.A. 2A:30A-1 to -2. The City filed its
answer.1
Discovery ensued, and the City subsequently moved for summary
judgment. It contended under the terms of the incorporated RFB documents
plaintiff was not entitled to additional payments, and, furthermore, plaintiff's
failure to comply with the claim-notice provisions of the contract barred its
request for additional payment. Plaintiff cross-moved for partial summary
judgment, arguing the contract documents included a "Differing Subsurface or
1
The City later impleaded third-party defendants Malcom Pirnie, Inc., and
Arcadis U.S., Inc., which later consolidated into a single company, Arcadis,
served as the City's engineering consultant for the project. Shortly thereafter,
the City dismissed its third-party complaint without prejudice. The case
proceeded without Arcadis as a party, and the company has not participated in
this appeal.
A-1726-19
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Physical Conditions" clause (the DSC clause), which entitled it to additional
payment for its expenses incurred because of unforeseen subsurface conditions.
Plaintiff also contended it substantially complied with the contract's claim-
notice provisions. The judge denied both motions, determining material
disputed facts existed requiring a trial.
Shortly before trial, which took place before a different judge, plaintiff
moved in limine to bar the City from introducing evidence of exculpatory
provisions in the contract, some of which we discuss below. The judge denied
the motion, concluding plaintiff essentially was seeking to relitigate the
arguments it made when it sought partial summary judgment. The case
proceeded to trial before a jury.
At the close of plaintiff's case, the City moved for a directed verdict.
Plaintiff voluntarily dismissed its claims for unjust enrichment and quantum
meruit, but otherwise opposed the motion. Although originally denying the
motion, after additional briefing, the judge dismissed plaintiff's PPA claim,
finding the statute did not apply to situations where the parties essentially
disagreed about the claimant's entitlement to payment. After testimony on the
defense case, the jury returned a no cause verdict in the City's favor on plaintiff's
breach of contract claim.
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Plaintiff moved for judgment notwithstanding the verdict (JNOV), or,
alternatively, for a new trial. In a brief oral opinion, the judge denied the motion
finding no miscarriage of justice.
Before us, plaintiff argues it was entitled to partial summary judgment as
a matter of law, because: 1) the DSC clause reflects the parties' anticipation that
the successful bidder could incur additional costs for undisclosed soil
conditions; 2) pursuant to federal case law and P.T. & L. Construction Co. v.
State of New Jersey Department of Transportation, 108 N.J. 539 (1987),
contractual exculpatory clauses cannot trump a DSC clause; and, 3) plaintiff
substantially complied with the contract's claim-notice provisions. Plaintiff also
argues the judge erred in denying the in limine motion to exclude evidence at
trial of the exculpatory clauses in the contract.
Plaintiff additionally contends the trial evidence did not support the
verdict, or, alternatively, it is entitled to a new trial because evidence presented
at trial regarding the exculpatory clauses "tainted the verdict by confusing the
jury as to the law." Lastly, plaintiff argues the judge erred in dismissing its PPA
claim.
We have considered the arguments in light of the record and applicable
legal standards. We affirm.
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I.
"Whether a summary judgment motion is granted, denied, or granted in
part and denied in part, an appellate court is limited to an examination of 'the
original summary judgment record.'" Noren v. Heartland Payment Sys., Inc.,
449 N.J. Super. 193, 196 (App. Div. 2017) (quoting Lombardi v. Masso, 207 N.J. 517, 542 (2011)). Our review of the motion judge's decision is de novo,
applying the same standard as he did, which
mandates that summary judgment be granted "if the
pleadings, depositions, answers to interrogatories and
admissions on file, together with the affidavits, if any,
show that there is no genuine issue as to any material
fact challenged and that the moving party is entitled to
a judgment or order as a matter of law."
[Templo Fuente De Vida Corp. v. Nat'l Union Fire Ins.
Co. of Pittsburgh, 224 N.J. 189, 199 (2016) (quoting R.
4:46-2(c)).]
A dispute of material fact is "genuine only if, considering the burden of
persuasion at trial, the evidence submitted by the parties on the motion, together
with all legitimate inferences therefrom favoring the non-moving party, would
require submission of the issue to the trier of fact." Grande v. Saint Clare's
Health Sys., 230 N.J. 1, 24 (2017) (quoting Bhagat v. Bhagat, 217 N.J. 22, 38
(2014)). "Accordingly, when the movant is the plaintiff, the motion court must
view the record with all legitimate inferences drawn in the defendant's favor and
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decide whether a reasonable factfinder could determine that the plaintiff has not
met its burden of proof." Globe Motor Co. v. Igdalev, 225 N.J. 469, 481 (2016).
In this case, plaintiff's partial summary judgment motion presented a legal
issue, i.e., interpretation of the DSC clause and its purported primacy over other
terms in the agreement. We consider such questions de novo, owing no
deference to the motion judge's legal analysis or interpretation of a statute.
Palisades At Fort Lee Condo. Ass'n v. 100 Old Palisade, LLC, 230 N.J. 427, 442
(2017) (citing Zabilowicz v. Kelsey, 200 N.J. 507, 512 (2009)).
Regarding the denial of plaintiff's in limine motion, we generally apply a
deferential standard and "reverse an evidentiary ruling only if it 'was so wide off
the mark that a manifest denial of justice resulted.'" Griffin v. City of E. Orange,
225 N.J. 400, 413 (2016) (quoting Green v. N.J. Mfrs. Ins. Co., 160 N.J. 480,
492 (1999)). "However, no deference is accorded when the court fails to
properly analyze the admissibility of the proffered evidence." E&H Steel Corp.
v. PSEG Fossil, LLC, 455 N.J. Super. 12, 25 (App. Div. 2018) (citing Konop v.
Rosen, 425 N.J. Super. 391, 401 (App. Div. 2012)). In those situations, our
review is de novo. Konop, 425 N.J. Super. at 401.
We agree with the trial judge that plaintiff's in limine motion merely
recycled the same legal arguments plaintiff made when it moved for partial
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summary judgment. In short, the same legal issue arose in both procedural
contexts.
Resolution of plaintiff's arguments initially causes us to cite extensively
the provisions of the contract documents, which were at the core of the City's
motion for summary judgment. The RFB contained the Project Manual, which
included the General Conditions (GC), Supplemental General Conditions
(SGC), Supplemental General Conditions of the Engineer (SGC-E), a 2002
Geotechnical Report by Arcadis (Appendix A), and a 2006 Sample Data Report
by Arcadis (Appendix B) (collectively, the reports). These documents,
excluding the two Arcadis reports, were incorporated specifically into the
contract, and only Appendix B was considered part of the bid documents.
The two appendices were central to plaintiff's claims. The 2002 Report in
Appendix A included technical data derived from test borings at the site, and, in
a synopsis, described the "[s]ubsurface conditions" as "consist[ing] of 9 to 17.5
feet of fill comprised of silty sand with gravel, brick, building debris, wood, and
metal fragments." Below that was "a layer of silty clay and organic silt/clay 4.5
to 11.5 feet in thickness, followed by silty sand with gravel and silt."
Appendix B was a 2006 report of "soil sampling" performed by Arcadis's
predecessor "to characterize the historic fill for transport and disposal." It
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contained pages of technical data, as well as the consultant's "[c]onclusions and
[r]ecommendations," including that "the historic fill material [at the site ] [was]
categorized as hazardous soil."
SGC-E §4.02(B) advised plaintiff it could "rely upon the general
accuracy" of the technical data in the reports, but the reports were not "[c]ontract
[d]ocuments." Plaintiff was further advised it "may not rely upon" the reports
or "make any [c]laim against" Arcadis or the City based on "the completeness"
of the reports, "other data, interpretations, opinions . . . in such reports," or any
"conclusion drawn from any 'technical data' or any such . . . interpretations,
opinions[,] or information." Similarly, §4.06, regarding "Hazardous
Environmental Conditions at the Site," provided plaintiff could only rely on the
general accuracy of the technical data in the reports and not on any opinions,
interpretations or conclusions drawn from them.
However, §4.03 of the SGC-E, entitled, "Differing Subsurface or Physical
Conditions" (the DSC clause), provided in relevant part that if plaintiff believed
"any subsurface . . . condition at or contiguous to the [s]ite [was] uncovered or
revealed," and the "'technical data' on which" it was "entitled to rely . . . [was]
materially inaccurate," was of such nature "to require a change in the [c]ontract
[d]ocuments," differed "materially from that shown . . . in the [c]ontract
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[d]ocuments," or was "of an unusual nature and differ[ed] materially from
conditions ordinarily encountered," it was not to disturb the subsurface
conditions further and had to advise Arcadis and the City. Additional provisions
called for the contract price or time for performance or both to be "equitably
adjusted," subject to additional conditions and limitations.
Plaintiff's partial summary judgment motion relied on that provision and
§11.2 of the GC (the concealed conditions clause), which Arcadis's project
manager, Luigi Zecchin, acknowledged allowed for price adjustment based on
concealed or unknown materially different conditions. That section of the GC
provided:
Should concealed conditions encountered in the
performance of the Work below the surface of the
ground . . . be at variance with the conditions indicated
by the Contract Documents, or should unknown
physical conditions below the surface of the ground
. . . differing materially from those ordinarily
encountered and generally recognized as inherent in
work of the character provided for in this Contract, be
encountered, the Contract Sum shall be equitably
adjusted by Change Order upon claim by either party
made within twenty days after the first observance of
the conditions.
The contract documents repeatedly limited any reliance on the reports.
Article 6.01 of the Project Manual said both reports were provided "for reference
only," and while plaintiff could rely on the technical data contained within the
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reports, it was "responsible for any interpretation or conclusion drawn from any
'technical data' or any other data, interpretations, opinions or information
contained in such reports." Similarly, Article 6.03, regarding "Hazardous
Environmental Conditions," stated Appendix B was provided "for reference
only," and while plaintiff could rely on the technical data in the reports, it was
"responsible for any interpretation or conclusion drawn from any 'technical data'
or any other data, interpretations, opinions or information contained in such
reports."
Article 6.05 allowed plaintiff to "conduct such examinations,
investigations, explorations, tests, and studies . . . necessary for submission of a
[b]id." The City set a time and date for a site visit by all bidders. 2 Article 6.09
provided that submission of a bid would serve as a representation that the bid
documents contained sufficient information for plaintiff to form its bid, and that
it complied with all requirements of Article 6:
The submission of a Bid will constitute an
incontrovertible representation by Bidder that Bidder
has complied with every requirement of this Article 6,
that without exception the Bid is premised upon
performing the Work required by the Bidding
Documents and applying any specific means, methods,
techniques, sequences or procedures of construction
2
It was later revealed at trial that plaintiff never sent a representative to the site
visit.
A-1726-19
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that may be shown or indicated or expressly required
by the Bidding Documents, that Bidder has given
[Arcadis] written notice of all conflicts, errors,
ambiguities and discrepancies that Bidder has
discovered in the Bidding Documents . . . and that the
Bidding Documents are generally sufficient to indicate
and convey understanding of all terms and conditions
for performing the Work.
D-19 of the SGC, entitled "Subsurface and Physical Conditions," was a
waiver of any claim against the City or Arcadis based on the bid documents:
It shall be understood and agreed that the Contractor
will not use any of the information made available to
him, or obtained in any examination made by him, in
any manner as a basis or ground of claim or demand of
any nature . . . arising from or by reason of any variance
which may exist between the information offered and
the actual materials . . . encountered during the
construction.
It is understood and agreed that [the City and
Arcadis] do not warrant or guarantee that the materials,
[and] conditions . . . encountered during the
construction will be the same as those indicated . . . in
the Contract Documents. Each bidder must inform
himself fully of the conditions relating to the
construction and labor under which the work will be
performed; and in particular as to subsurface and
groundwater conditions; failure to do so will not relieve
a successful bidder of his obligation to furnish material
and labor necessary to carry out the provisions of the
Contract documents and to complete the contemplated
work for the considerations and he makes his bid with
full knowledge of conditions, and the kind, quality, and
quantity of the work required.
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It is also understood and agreed that the Bidder
or the Contractor will not use any of the information
made available to him or obtained in any examination
made by him, in any manner as a basis or ground of
claim or demand of any nature against the [City or
Arcadis], arising from or by reason of any variance
which may exist between the information offered and
the actual materials or structures encountered during
construction.
Before plaintiff could begin excavation, Article 1.7 of the Project Manual
required it to draft a Pre-Characterization Program Work Plan and Soil
Management Plan (the Plan), setting forth its intended manner of excavation and
disposal of hazardous and non-hazardous soil, and to submit them for approval
to Zecchin. If the soil disposal facility plaintiff chose to use required additional
testing to "sufficiently categorize all soil," Article 1.7B provided the testing, and
any fee for equipment needed to conduct the testing, would be done "at no
additional cost to [the City]."
Zecchin approved the Plan, which anticipated plaintiff would conduct
twenty additional samplings from the project site and dispose of the excavated
soils at three sites, only one of which accepted hazardous materials. In support
of its motion for partial summary judgment, plaintiff claimed it encountered
unanticipated subsurface materials as it tried to install a cofferdam and alleged
these subsurface conditions were contrary to those represented in the reports. It
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claimed that the Appendix A report indicated the absence of any obstructive
material after a depth of ten feet, yet it encountered timber pilings and other
debris that impeded its ability to install the cofferdam. It notified Zecchin of its
intention to seek additional compensation for these allegedly unforeseen
conditions.
Plaintiff also contended that early testing showed the non-hazardous soil
was nonetheless close to limits the Department of Environmental Protection set
for hazardous materials. Given the proximity between hazardous and non-
hazardous soils at the site, plaintiff claimed the disposal facility it chose would
not accept any soils as non-hazardous soils, and it became necessary for plaintiff
to dispose of all excavated soils as if they were hazardous. Plaintiff argued that
Appendix B recognized all historic fill was hazardous and needed to be disposed
of as such. Ultimately, a facility in Pennsylvania agreed to accept the non-
hazardous material, but plaintiff alleged at greatly increased costs. Plaintiff
again cited these unforeseen circumstances to Zecchin and requested additional
compensation.
In a June 15, 2012 letter, Zecchin denied plaintiff's request for additional
payment, explaining the RFB documents notified bidders of the hazardous
material at the site, estimated the amount of that material, and required the
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successful bidder to identify and dispose of all hazardous material. Zecchin
noted that plaintiff had the opportunity to make any inquiries or raise any issues
prior to submitting its bid and failed to do so. Zecchin said the contract placed
the risk of that failure on plaintiff, and it was necessary for it to continue to
separate hazardous and non-hazardous materials for disposal.
Zecchin also reiterated, as he had in prior correspondence and discussions
with plaintiff, that "the conditions at the site have not materially changed from
those identified in the Contract Documents." He requested plaintiff comply with
the agreement, proceed to separate hazardous from non-hazardous soils, and
dispose of them accordingly. Additionally, Zecchin requested plaintiff comply
with the formal claim-notice process set forth in the contract, which required
submission of a claim within twenty days if it intended to continue to assert
claims for additional compensation.
Although plaintiff served written notice of its intention to seek additional
compensation through the fall of 2012 and into 2013, it did not request a change
order to the contract until March 2013. Citing increased costs and resulting
delays in completing the project, plaintiff sought more than $1.6 million in
additional compensation.
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Plaintiff completed the work by February 2014. The City paid the full
contract price, minus retainage of $197,860, because plaintiff failed to complete
all close-out documents, including a final release and waiver of claims, required
by the contract.
In denying plaintiff's motion for partial summary judgment, the judge
reasoned there were material disputes whether the unanticipated subsurface
conditions existed, whether plaintiff failed to reasonably anticipate these
conditions, and whether it had complied with the claims-notice provisions of the
contract.
Before us, plaintiff reiterates its claim that based on the undisputed facts
in the summary judgment record, it was entitled to these additional sums as a
matter of law under the DSC, without regard to the other exculpatory provisions
of the contract. Plaintiff contends any other interpretation of the agreement
would "undermine the stability within the construction industry [which] . . .
rel[ies] on the use of the DSC clause in exchange for lower construction costs."
In this regard, plaintiff primarily relies on the Court's decision in P.T. & L.
Construction Co. and federal case law.
In P.T. & L. Construction Co., a contractor sued the State to recover
payment for additional and allegedly unexpected expenses associated with the
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construction of a bridge on Interstate 78 in Springfield. 108 N.J. at 542.
"According to [the] plaintiff's witnesses, the job was plagued from the start by
poor working conditions" and resulted in a completion date nearly two years
later than expected. Id. at 543. Drainage was a major problem, and the plaintiff
claimed that the State not only failed to disclose certain information relating to
drainage at the site, but also misled and withheld material information from the
plaintiff. Id. at 544–45. Relying on exculpatory provisions in the contract, the
State claimed it was not liable for any additional expenses, and instead, the
contractor was liable for liquidated damages because of the delay in completion.
Id. at 544.
The Court began by discussing the "tension" that exists in public contracts
because the lowest bidder is awarded the contract. Id. at 546–47. This promotes
price competition, but the practice produces "an anomalous effect" by "forc[ing]
both the contractor and the state to search intensively for means to protect, if not
improve, their positions once the contract price is fixed and performance is
begun." Id. at 547 (quoting Scott A. Livingston, Fair Treatment for Contractors
Doing Business With the State of Maryland, 15 Univ. Balt. L. Rev. 215, 226–
27 (1986) (footnotes omitted)).
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While the contract did not contain a DSC clause, typical of State contracts
at the time, the Court noted that federal government contracts usually included
such clauses, id. at 548, and our State law on public contracts had "evolved on
parallel lines" with federal jurisprudence, id. at 551. Referring to federal
practice, the Court explained that a DSC clause "take[s] at least some of the
gamble on subsurface conditions out of bidding" by giving the contractor
"information on which they may rely in making their bids," while also
"promis[ing] an equitable adjustment . . . if subsurface conditions turn out to be
materially different than . . . indicated . . . ." Id. at 548 (quoting Foster Constr.
C.A. & Williams Bros. v. United States, 435 F.2d 873, 887 (1970)).
The Court explained: "When the government makes a positive statement
of fact about the character of work to be performed, upon which the contractor
may reasonably rely, it is binding on the government notwithstanding the
inclusion of exculpatory clauses in the contract." Id. at 548–49 (citing United
States v. Spearin, 248 U.S. 132, 136–37 (1918)). "Nevertheless, the contractor
must absorb expenses that would have been avoided if the contractor had been
conscientious in its investigation." Id. at 549 (citing D. Federico Co., v. New
Bedford Redevelopment Auth., 723 F.2d 122, 125 (1st Cir. 1983)).
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After considering three decisions from our court, the Court summarized
the applicable standard:
[W]hen the State makes false representations it will be
liable for damages resulting from them despite a
general disclaimer of liability for inaccurate
representations. However, if the disclaimer is
sufficiently specific or if the statements only purport to
be the results of tests rather than being actual conditions
or descriptions of actual conditions, then the contractor
cannot recover.
[Id. at 553 (quoting Ell-Dorer Contracting Co. v. State,
197 N.J. Super. 175, 183 (App. Div. 1984) (emphasis
added)).]
If the contract contains a DSC clause, "it is not necessary to find that the bidder
was 'misled' or that the government 'concealed' information." Id. at 558 (quoting
United Contractors v. United States, 368 F.2d 585, 597 n. 6 (Ct. Cl. 1966)). "It
will suffice under that form of contract that the bidder did not expect or have
reasonable cause to anticipate the underground conditions encountered." Ibid.
But, if the contract "shifts to the bidder the burden of evaluating subsurface
conditions," a higher standard is imposed. Ibid. Recovery may be barred "if no
information to the contrary has been withheld" by the government, or the "bidder
. . . [in]adequately investigated the site." Ibid. (quoting Golomore Assocs. v.
N.J. State Highway Auth., 173 N.J. Super. 55, 58 (App. Div. 1980)).
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Justice O'Hern summarized the interplay of these principles at the very
beginning of the Court's opinion by holding:
[T]here is a sufficient factual basis to sustain the trial
court's finding that the State's nondisclosure of material
facts constituted a misrepresentation of site conditions
for which recovery may be allowed. The general
exculpatory clauses of the contract disclaiming
responsibility for differing site conditions do not apply
in the face of such a finding. We note, however, that
had the plaintiff's claim been premised only on its
conclusion that dry working conditions were implicit in
the contract specifications, recovery would have been
precluded by the specific disclaimers of State
responsibility for site conditions. There is a critical
distinction between a claim based on the State's
implying that conditions would be dry and a claim
founded on the State's withholding information that
conditions would be wet.
[Id. at 541–42.]
The Court fully recognized consideration of these issues involves resolution of
factual disputes. Id. at 558–61.
It is obvious from the decision in P.T. & L. Construction Co. that a DSC
clause and exculpatory clauses may validly co-exist in the same contract, and,
contrary to plaintiff's continued assertions before us, whether a contractor is
entitled to rely on the terms of the DSC clause for additional payment despite
the existence of exculpatory clauses presents distinctly mixed questions of fact
and law. Id. at 560. The motion judge correctly denied plaintiff's motion
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because the undisputed facts did not establish that plaintiff was entitled to
judgment as a matter of law. Globe Motor Co., 225 N.J. at 481.
In the context of plaintiff's partial summary judgment motion, the DSC
clause allowed for an adjustment to the price if plaintiff demonstrated as
undisputed fact that a "subsurface . . . condition" at the site was "uncovered or
revealed," and the "'technical data' on which" it was "entitled to rely . . . [was]
materially inaccurate," was of such nature "as to require a change in the
[c]ontract [d]ocuments," differed "materially from that shown or indicated in the
[c]ontract [d]ocuments," or was "of an unusual nature[] and differ[ed] materially
from conditions ordinarily encountered." Section 11.2 of the GC, the concealed
conditions clause, required plaintiff to demonstrate as undisputed fact that
subsurface conditions were "at variance with the conditions indicated by the
[c]ontract [d]ocuments," or "differ[ed] materially from those ordinarily
encountered and generally recognized as inherent in work of the character
provided for in this [c]ontract."
A question of fact existed as to whether the subsurface obstructions that
delayed installation of the cofferdam, and the City's requirement that plaintiff
separate all hazardous and non-hazardous material, including that which was
historic fill, differed from the bid documents incorporated into the parties'
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agreement. Plaintiff claimed that they did, but various provisions in the bid
documents did not support its position.
The Project Manual disclosed that the site had been the location of
warehouses, factories and other structures and that the contractor would be
expected to remove "old uncharted foundations, rubble from former structures,
timber piling[,] and concrete pipe, concrete pipe supports, [and] timber cribbing
. . . that may contain debris such as tires, cinders, glass, ash, wood, metal and
steel." Appendix A also told plaintiff that the soil comprised "9 to 17.5 feet of
fill," which included "silty sand with gravel, brick, building debris, wood, and
metal fragments." Whether this information adequately informed plaintiff of the
nature of the subsurface conditions, so as to defeat its claim that the obstructions
encountered in installing the cofferdam were unforeseen and materially
different, presented disputed facts.
With respect to the City's requirement that plaintiff separate all hazardous
material from non-hazardous material, plaintiff relied on Appendix B, which
opined that all historic fill would have to be disposed of as hazardous material.
However, various provisions in the Project Manual limited a bidder's reliance to
only technical data contained in Appendix B. Moreover, the Project Manual
required plaintiff to separate the soil into naturally deposited material and
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historic fill, each of which would be further divided into hazardous and
nonhazardous material, and to dispose of each in accordance with DEP
regulations. The Plan submitted by plaintiff included separation of soil into
these categories. Whether the City's insistence on separation of the excavated
soil over plaintiff's objection was a material change in the terms of the agreement
was a disputed fact.
In short, the motion judge correctly found there were material factual
disputes foreclosing partial summary judgment in plaintiff's favor. See, e.g.,
SMC Corp. v. N.J. Water Supply Auth., 334 N.J. Super. 429, 435 (App. Div.
2000) (explaining whether a subsurface condition was "reasonably obtainable"
or "ascertainable" so as to entitle the contractor to additional payment was an
issue of fact).
In light of our discussion, plaintiff's contention that the trial judge erred
by denying its motion in limine to exclude evidence of the exculpatory
provisions of the contract lacks sufficient merit to warrant discussion in a written
opinion. R. 2:11-3(e)(1)(E). Simply put, contrary to plaintiff's argument, the
DSC clause did not render the exculpatory provisions of the agreement
irrelevant at trial.
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II.
Plaintiff contends the court erred in denying its motion for JNOV, see R.
4:40-2, on its breach of contract claim. It argues that it proved the City breached
the agreement by failing to: adequately convey the nature of the historic fill and
its intention to have plaintiff separate the hazardous material; disclose the nature
of the subsurface materials, which complicated installation of the cofferdam;
and pay plaintiff the outstanding contract balance of $197,860 held as a
retainage. Plaintiff contends the trial evidence supporting its claims was
essentially undisputed.
When considering a motion for JNOV or a new
trial, "[t]he trial judge shall grant the motion if, having
given due regard to the opportunity of the jury to pass
upon the credibility of the witnesses, it clearly and
convincingly appears that there was a miscarriage of
justice under the law."
[Barber v. ShopRite of Englewood & Assocs., Inc., 406
N.J. Super. 32, 51 (App. Div. 2009) (alteration in
original) (quoting R. 4:49-1(a)); see also Pressler &
Verniero, Current N.J. Court Rules, cmt. 3 on R. 4:40-
2 (2022) ("The standard for granting [JNOV] is
essentially the same as that applicable to the grant of a
new trial motion." (citing Barber, 406 N.J. Super. at 51–
52)).]
"[A] 'miscarriage of justice' can arise when there is a 'manifest lack of
inherently credible evidence to support the finding,' when there has been an
'obvious overlooking or under-valuation of crucial evidence,' or when the case
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24
culminates in 'a clearly unjust result.'" Hayes v. Delamotte, 231 N.J. 373, 386
(2018) (quoting Risko v. Thompson Muller Auto. Grp., Inc., 206 N.J. 506, 521–
22 (2011)). As a prerequisite to filing a motion for JNOV, the party must have
filed a motion for judgment prior to or during trial; failure to do so will preclude
the motion. Velazquez v. Jiminez, 336 N.J. Super. 10, 33 (App. Div. 2000).3
Because we write solely for the parties involved, we need not detail the
substantial evidence at trial that supported the City's arguments, premised on the
exculpatory language of the contract, which raised significant doubt about
plaintiff's claims of material reliance on the information contained in the reports
or deviations from representations made regarding subsurface conditions.
The evidence supported the jury's finding of no cause even as to the
retainage. The City established that plaintiff never submitted the necessary
documents for final payment, and plaintiff presented no evidence to the contrary.
Indeed, plaintiff's vice-president, John Scannella, Jr., testified that he never
3
The City contends plaintiff's claim for JNOV as to the retainage is procedurally
barred because plaintiff's partial summary judgment motion was limited to
liability, and plaintiff specifically asserted that the issue of damages required a
trial. See Velazquez, 336 N.J. Super. at 33 ("Under Rule 4:40-2, a [JNOV]
cannot be entered unless a motion for judgment or its equivalent has been made
during trial." (citing Surkis v. Strelecki, 114 N.J. Super. 596, 599–600 (App.
Div.1971))). We agree the claim in this respect was procedurally barred, but we
address it anyway being convinced, as we explain, that it lacks any merit.
A-1726-19
25
signed a final release and waiver of claims, both of which the contract required
plaintiff submit to receive full and final payment.
Plaintiff also contends it was error to deny its motion for a new trial, see
R. 4:49-1(a), citing once again the judge's denial of its in limine motion, thereby
permitting the City to introduce evidence and testimony regarding the
exculpatory provisions, and also that the judge's final instructions confused the
jury. These contentions lack sufficient merit to warrant discussion in a written
opinion. R. 2:11-3(e)(1)(E).
III.
Lastly, plaintiff argues the trial judge erred in granting a directed verdict
on its PPA claim. As we discern the limited argument made in plaintiff's brief,
it contends that Scannella testified plaintiff submitted its final invoice in January
2016 but it remained unpaid at the time of trial.
Rule 4:40-1 permits a party to move for a directed verdict at the close the
opponent's evidence. Like the standard for summary judgment, the court must
determine "whether the evidence presents a sufficient disagreement to require
submission to a jury or whether it is so one-sided that one party," in this case,
the City, "must prevail as a matter of law." Frugis v. Bracigliano, 177 N.J. 250,
269 (2003) (quoting Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 536
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26
(1995)). On appellate review, "we apply the same standard that governs the trial
courts." Smith v. Millville Rescue Squad, 225 N.J. 373, 397 (2016) (citing ADS
Assocs. Grp., Inc. v. Ortiani Sav. Bank, 219 N.J. 496, 511 (2014)).
The PPA provides in relevant part:
If a prime contractor has performed in accordance with
the provisions of a contract with the owner and the
billing for the work has been approved and certified by
the owner or the owner's authorized approving agent,
the owner shall pay the amount due to the prime
contractor for . . . retainage monies not more than
[thirty] calendar days after the billing date . . . specified
in the contract.
[ N.J.S.A. 2A:30A-2(a) (emphasis added).]
"If a payment due pursuant to the provisions of this section is not made in a
timely manner, the delinquent party shall be liable for the amount of money
owed under the contract, plus interest at a rate equal to the prime rate plus 1%."
N.J.S.A. 2A:30A-2(c).
In this case, the trial judge entered judgment in the City's favor reasoning
the PPA did not apply because the parties disputed plaintiff's entitlement to
payment of the retainage based on its failure to execute and return all necessary
documents, as required by the contract. While we generally agree with this
reasoning, the issue was raised in the procedural context that required the judge
to accord all favorable inferences to plaintiff. However, as noted, plaintiff's own
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27
vice-president acknowledged during his testimony on plaintiff's case-in-chief
that the company failed to execute closing documents as required by the contract
because it did not want to waive its right to bring this litigation. In other words,
it was undisputed that plaintiff had not "performed in accordance with the
provisions of a contract," N.J.S.A. 2A:30A-2(a), a predicate for recovery under
the PPA.
We agree, therefore, that the judge properly granted a directed verdict in
the City's favor on the PPA claim for the retainage, albeit for slightly different
reasons than expressed by the trial judge. See Hayes, 231 N.J. at 387 (noting "it
is well-settled that appeals are taken from orders and judgments and not from
opinions, oral decisions, informal written decisions, or reasons given for the
ultimate conclusion." (quoting Do-Wop Corp. v. City of Rahway, 168 N.J. 191,
199 (2001))).
Affirmed.4
4
In its reply brief, plaintiff for the first time asserts the judge erred in denying
its motion for a "directed verdict." There is no record citation to the transcript
in plaintiff's reply brief demonstrating that it ever made such a motion, and we
saw none in our review. Regardless, it is inappropriate to raise an issue for the
first time in a reply brief. See, e.g., L.J. Zucca, Inc. v. Allen Bros. Wholesale
Distribs. Inc., 434 N.J. Super. 60, 87(App. Div. 2014) (determining that an
argument raised for the first time in a reply brief is "deem[ed] . . . to have been
waived").
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