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Clement Brothers Co. v. North Carolina Department of Administration and Appalachian State University

Filed: June 1, 1982.

CLEMENT BROTHERS COMPANY, INC.
v.
NORTH CAROLINA DEPARTMENT OF ADMINISTRATION AND APPALACHIAN STATE UNIVERSITY



Appeal by plaintiff and defendants from Godwin, Judge. Summary judgment entered 9 June 1981 in Superior Court, Wake County. Heard in the Court of Appeals 5 April 1982.

Clark, Judge.

Clark

Defendants' Appeal

Defendants contend that the court erred in granting plaintiff's motion for partial summary judgment which required that defendants remit part of the liquidated damages assessed against plaintiff. This issue involves an interpretation of the provisions of Addendum No. 3 to the Contract between the parties, which reads as follows:

"Sections III, IV, V, VI, VII, VIII, IX, and X:

The time of 540 days for completion of the above listed sections of the project has brought objections from various contractors who are concerned over the bad winter weather.

In lieu of extending the time of completion for those Sections of the Project the following will govern this phase of the work:

'With the mutual consent of the Contractors and the Engineers, in event of winter weather conditions which are not in the best interest of the Owner and Contractor a stop-order will be issued until such time as working conditions improve

to a point that the work can be resumed to the mutual benefit of all parties. This stop-order shall be issued only on severe winter weather conditions. The time the stop-order is in effect will not be included in the Contractors [ sic ] calender days time for completion of the project.'"

Plaintiff requested and received a stop order to suspend its operations temporarily during adverse weather conditions in the winter of 1971-72. A series of letters was transmitted between the parties concerning a shutdown for bad weather during the winter of 1972-73. In August 1972, defendants advised plaintiff that it was to proceed with construction of the dam to meet the 30 May 1973 completion date and that no further shutdowns would be allowed. Although the record is not clear on this point, it appears that the August letter was not in response to a request for a shutdown by plaintiff, but the result of defendants' concern that the project was behind schedule. In November 1972, plaintiff was denied a stop order for the winter of 1972-73. From the defendants' course of conduct, plaintiff did not request a shutdown for the winter of 1973-74, believing any such request would be futile. The parties stipulated that the weather conditions were substantially the same in all three of the winters in question. Plaintiff was assessed liquidated damages of $89,400 for 447 days of downtime.

Defendants contend that their refusal to grant shutdowns during the winter seasons was not arbitrary but was in compliance with the contract provisions requiring "mutual consent" before a stop order was issued. The trial court, however, disagreed, concluding as a matter of law that:

"4. Defendants' action in advising plaintiff in August and November, 1972, that no further arrangement would be made for work stoppage was arbitrary and not in accordance with contract requirements that reasonable consideration be given by both parties to a work stop order in the event of ...


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