STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
BURNS, KIRKLEY, and WILLIAMS ) CONSTRUCTION COMPANY, )
)
Petitioner, )
)
vs. ) CASE NO. 75-1987BID
) DEPARTMENT OF GENERAL SERVICES, )
)
Respondent. )
)
RECOMMENDED ORDER
This cause came on for final hearing pursuant to proper notice on December 14, 15, and 16, 1977, before the undersigned Hearing Officer.
APPEARANCES
For Petitioner: John N. Boggs, Esquire
Post Office Box 1638 Panama City, Florida 32401
For Respondent: Donna Stinson, Esquire
Post Office Box 1118 Tallahassee, Florida 32302
Pursuant to stipulation of counsel, all depositions and documents previously filed in this cause were admitted into evidence.
The dispute in this cause centers around three areas of work pertinent to a construction contract between Petitioner and Respondent in which additional compensation and time extensions are sought by Petitioner. First, Petitioner claims additional compensation for cleaning of mildew and scraping, patching and sanding the interior surfaces of the four subject dormitories. Petitioner contends that the necessity for such work was not apparent at the time of bid and was caused by unforeseeable forces outside its control, thereby causing extra work. Respondent contends that due to the age and condition of the dormitories some increase in mildew and peeling paint was foreseeable, and that the excessive amount was due to Petitioner's negligence and failure to comply with contract requirements of keeping the building closed and protected from inclement weather.
Second, Petitioner contends that no interior caulking of existing woodwork was required by the plans and specifications, but that the architect nevertheless required such caulking. Respondent contends that Petitioner was required to only caulk new woodwork or woodwork which was somehow altered during construction. Petitioner claims additional compensation as warranted for labor and materials expended to comply with the architect's demands beyond the requirements of the plans and specifications.
Third, the parties are in dispute concerning painting of interior doors.
Petitioner contends that as many as eight coats of paint were required to achieve am acceptable finish on the interior dormitory doors, thus warranting additional compensation for the labor and materials expended.
In addition to the extra compensation in dispute above, Petitioner seeks an offset of liquidated damages assessed for the job overrun, interest, costs, and attorneys' fees.
All motions not previously disposed of are hereby denied.
Having considered all testimony and evidence admitted to the record, as well as the argument and memoranda of counsel, and being otherwise fully advised in these proceedings, the Hearing Officer enters the following:
FINDINGS OF FACT
Burns, Kirkley and Williams Construction Company (hereinafter referred to as "Petitioner") operates a general contracting business. Petitioner entered into a construction contract with the Department of General Services (hereinafter referred to as "Respondent") for the renovation of four dormitories, Diamond, McGuinn, Young, and Sampson, and the construction of a new "Core Building" on the campus of Florida A & M University in Tallahassee, Florida. This contract is referred to as Project BR-9201, Phase I. The dispute in this cause does not involve the construction of the Core Building. P & W Decorators (hereinafter referred to as "P & W") is a commercial painting contractor. The architectural firm of Robert G. Graf and Associates (hereinafter referred to as "Architect") compiled the contract documents, including the plans and specifications.
The dormitory buildings being renovated under the subject contract were vacated by students in June of 1974 and not thereafter occupied. The buildings were all more than twenty years old. The heat in these buildings was shut off in November, 1974 and no effort was made by Respondent to maintain climate control in the dormitory buildings from November, 1974 up to the Notice to Proceed issued Petitioner on February 20, 1975.
The bid-letting on this construction contract was held on December 19, 1974. In early December, 1974, prior to the bid-letting, a project manager for Petitioner spent one week on the job site and went through every room of every building subject to the contract for the purpose of evaluating the project for bid. The project manager at that time found no significant problem with mildew or peeling paint. At least three paint subcontractors, including P & W, visited the site prior to bid and found no significant problem with mildew or peeling paint. The evidence establishes that up to and including the time of the bid- letting there was no apparent problem with mildew or peeling paint on the project. The evidence further establishes that as far as painting was concerned the ceilings and walls of the building appeared to be in good shape, presenting no special problem relative to a renovation project.
At the bid-letting on December 19, 1974, Petitioner was the apparent low bidder. Respondent delayed award of the job asking and receiving from the Petitioner an extension of time to consider award. Petitioner received its formal Notice to Proceed from Respondent on February 20, 1975. Prior to the bid-letting Petitioner received prices from at least three painting subcontractors, including P & W. These three firms were responsible, experienced paint subcontractors. All had looked at the job site prior to
preparing a price, and none included in their price any amount for a serious mildew and peeling paint problem. None foresaw any difficulty in preparing the ceilings and walls for painting. On February 12, 1975, Petitioner entered into a subcontract with P & W in the amount of $83,325.00 for the painting part of the subject project.
Although the Notice to Proceed was dated February 20, 1975, Petitioner's mechanical subcontractor went on the job site on February 6, 1975. At that time he found excessive moisture in the buildings. According to his testimony the walls and floors were dripping with moisture. On March 3, 1975, Petitioner's project manager wrote the Architect to inform him that on walking through two of the four dormitories he,
. . .noticed that practically all bedrooms in these buildings are accumulating a great deal of mildew on the walls. This problem has just begun and seems to be continuing. Next week I will be going to Young and Sanford [two other dormitories] and see if this problem is occurring in these buildings. At this time we do not know the extent of problems the mildew might cause. Therefore, we are writing to inform you and all concerned of this problem. (See Petitioner's Exhibit 6).
Soon after Notice to Proceed issued to Petitioner, mildew began growing rapidly in the subject buildings. This led to problems with peeling paint. As warm weather came with Spring and Summer, the growth of the mildew and the resulting peeling paint was very rapid. On March 27, 1975, a construction conference was held between representatives of Petitioner, Respondent, Florida A & M University, the mechanical subcontractor, and the Architect. The matters discussed at that construction conference were memorialized by formal notes made by Robert G. Graf, Architect, dated March 31, 1975. (See Petitioner's Exhibit 8). In those notes Mr. Graf stated that,
The Architect reported that the general contractor has placed in writing his concern about the rapid growth of mildew in the buildings and affect [sic] which the mildew may have on the paint in the future. The Architect is in the process of investigating the cause of the mildew growth to determine if
the growth and/or responsibility of the painted surfaces is the responsibility of the contractor or others. A report will be made
in the near future concerning this matter.
During March, April, and May Petitioner's paint subcontractor, P & W, repeatedly raised the problem of the mildew and peeling paint, both from the point of view of how to best deal with the problem and from the point of view of additional compensation for extra work caused by the problem. No response was forthcoming from the Architect until June 6, 1975, by which time the problem was almost at its height. By letter dated June 6, 1975, (See Respondent's Exhibit
3) the Architect noted that the growth of mildew and the peeling of paint had increased "profoundly" since the bid-letting. He further stated that in his opinion the excessive mildew growth was,
. . .directly attributable to the excess moisture in the building resulting from the termination of the heating system, and open windows emitting excessive moisture since January, 1975. The conditions for mildew growth under these conditions were ideal.
Referring to the contract documents, wherein there is required of the contractor surface preparation and cleaning prior to painting, the Architect then concluded that Respondent was not required to incur additional expense to clean, patch, kill mildew or remove peeling paint. In that letter the Architect was under the mistaken impression that the termination of heat in the buildings was in January, 1975. In fact heat to the buildings had been terminated in November, 1974.
Between the termination of heat in November, 1974, and the Notice to Proceed dated February 20, 1975, Petitioner had no legal responsibility and assumed no actual responsibility for the maintenance or climate control of the subject buildings. During that period of time the buildings had no heat and excessive amounts of moisture accumulated in them. Within two weeks of the Notice to Proceed, Petitioner observed a burgeoning mildew and peeling paint problem and promptly notified the Architect.
After assuming control of the job site, subject to the Notice to Proceed, Petitioner maintained the appropriate climate control in the subject buildings for the trades working therein. The evidence establishes that the basic cause of the mildew and peeling paint problem existed at the time Petitioner received the Notice to Proceed, and was not exacerbated by any negligent action on his part once on the job site.
It is clear from the evidence presented that, although the basic cause of the serious mildew and peeling paint problem existed prior to Petitioner receiving the Notice to Proceed, the problem could not have been reasonably foreseen by Petitioner at the time of bid-letting. At that time the problem lay dormant awaiting the warming of Spring to trigger the growth of mildew. The basic cause of the problem appears to have been the termination of heat in the buildings by their owners in November, 1974, the accumulation of excessive moisture in the ensuing months, and the onset of warm weather with Spring. Apparently a unique set of circumstances, including the age of the building, combined to cause an extraordinary and explosive growth of mildew. Such could not have reasonably been foreseen by Petitioner and was not apparent at the time the contract was entered into by the parties.
In the face of the serious mildew and peeling paint problem, Petitioner, through his paint subcontractor, P & W, had to kill the mildew and scrape the peeling paint in order to properly prepare the surfaces for painting.
The evidence presented establishes that Petitioner, through his paint subcontractor, P & W, expended $33,098.00 in labor, materials, taxes, and insurance in eliminating the mildew and peeling paint problem in the four dormitory buildings. (See Petitioner's Exhibit 14 for breakdown of cost.) The work required to solve the mildew and peeling paint problem was work over and beyond that required by the Contract Documents.
During the course of the job a dispute arose between Petitioner, through his paint subcontractor, P & W, and Respondent, over how much caulking was required by the Contract Documents. It was not disputed that new woodwork should be caulked if it did not fit properly. The dispute centered around the caulking of existing woodwork not disturbed by the renovation.
Section 7TO of the Contract Documents, entitled "Joint Sealers", states the following concerning caulking:
Description of work: . . .
The required applications include, but are not necessarily limited to the following:
Sidewalk joints subjected to foot traffic. Exterior building wall joints.
Flashing joints.
Miscellaneous concrete construction joints. Floor (interior) joints.
Partition and ceiling joints. Equipment and isolation joints.
Further, the blueprints, which are part of the plans and specifications, require caulking around "window frame and sill". This letter is properly interpreted to refer to the exterior portion of the window for which no claim is made.
Throughout this project a dispute existed between Petitioner and Respondent over the requirements of the contract with respect to caulking. Finally, by letter dated May 21, 1976, Petitioner, through the project manager, wrote the Architect stating that to avoid any dispute or misunderstanding concerning caulking of existing wood base, interior windows, shelving, and picture mold, Petitioner did ". . .hereby request written instructions whether to caulk or not to caulk." (See Petitioner's Exhibit 19). The letter further stated Petitioner's position that the plans and specifications did not require the above to be caulked. On June 4, 1976, (See Petitioner's Exhibit 20) the Architect replied to Petitioner's letter stating that
. . .the plans are very clear as to what repair and caulking is required. . . We do not expect any work to be done that is not called for in the specifications. If there is misfitting woodwork that can be solved by
caulking, we will allow it. If you do no [sic] want to caulk, then we are forced to have the items removed and rebuilt."
No more definitive response to Petitioner's request for instructions was received.
Because of the position taken by the Architect, Petitioner caulked interior windows and existing woodwork while asserting that he was entitled to additional compensation for such work. The major item involved in this dispute over caulking concerns existing trim which ran around the walls of each room at the floor, at picture height, and at the ceiling. The evidence presented, including testimony by the employee of Respondent who represented the Respondent on the job site, establishes that Petitioner was required by the Architect to caulk all existing woodwork where there was a gap, including the trim referred above. Further, the evidence presented by engineers and other members of the general contracting and painting industry established that the requirements of the plans and specifications referred to in Paragraph 13 above are normally interpreted to apply to new woodwork, not existing woodwork. Testimony establishes that if it was expected that existing woodwork be caulked the plans and specifications would normally have contained a specific statement so that the contractors bidding the job would be on notice of that requirement. The three paint subcontractors who submitted prices to Petitioner for that portion of the contract which includes the caulking, uniformly excluded from their price an amount which would represent the cost of caulking existing woodwork. They did not believe the plans and specifications of the contract called for such caulking.
Some evidence was presented by the Architect that no general requirement for caulking of all existing woodwork was imposed by him. Although that may not have been the intent, the evidence presented establishes that the state project manager for Respondent present on the job site believed that the Architect imposed such a requirement. It is also interesting to note that a punch list for final inspection on one of the dormitories included a General Note to "caulk top of baseboard and all holes around wood trim". (See Petitioner's Exhibit 21). Such a requirement was interpreted by all concerned on site to mean to caulk all existing woodwork.
The evidence presented establishes that Petitioner, through his subcontractor, P & W, expended $9,118.00 in labor and materials, taxes and insurance in performing caulking of existing woodwork not otherwise disturbed by renovation.
Petitioner expended 5,201 man hours of labor in killing mildew, scraping, patching and sanding because of the mildew and peeling paint problem. Petitioner further expended 1,043 man hours of labor in performing the caulking of existing woodwork not otherwise disturbed by renovation.
A color specification chart was submitted by the Architect to Petitioner on July 14, 1975. (See Petitioner's Exhibit 4). This color schedule did not contain a color chart for the interior dormitory rooms. This was an oversight on the part of the Architect. Subsequent to the receipt of that chart P & W contacted the Architect who told them that the interior dormitory doors were to be painted the same color as the ceiling and wall, and that P & W could go ahead and order all of the paint. In reliance on that statement P & W did order a significant amount of paint in a color called Sugar Mint. After receiving that paint P & W applied one coat to all of the dormitory doors in one of the dormitories. As a result of that the Architect became aware that the doors were being painted Sugar Mint and, on November 10, 1975, notified Petitioner that the doors should be painted Federal Blue or Cordoba Brown. This misunderstanding was the result of the Architect's failure to include a color schedule for the dormitory doors on the color specifications submitted on July 14, 1975. The change in the color specifications on November 10, 1975, caused
some delay on the project while P & W attempted to quickly acquire the right color paint. In an attempt to prevent further delay on the project P & W hastily acquired paint from several paint stores and hand mixed the paints for color on the job. Normally paints would have been ordered premixed as to color from the supplier.
Petitioner does not seek any compensation for the Sugar Mint color paint or its application to the doors in one of the dormitories. Petitioner does seek compensation, however, because P & W in order to achieve an acceptable finish on the hundreds of interior doors in four dormitories, applied at least two extra coats of paint to those doors in addition to the two coats of paint called for in the Contract Documents, and in some instances, applied as many as eight additional coats.
In November, 1975, when the Architect countermanded his previous color specification with regard to the dormitory doors, the Architect was also demanding that Petitioner hurry with completion of the project and would brook no delay because of the confusion caused with regard to paint color. This problem with the paint color was the direct result of the Architect's failure to include the proper color on his original specification, and the erroneous notification to P & W to use Sugar Mint. In no way was Petitioner or P & W responsible for this problem. When the color schedule was corrected in November, 1975, P & W was told by the Architect that they had to continue in a timely fashion with the project even though the change in color created problems for P & W. In an attempt to comply with this directive from the Architect P & W tried to mix the proper color paint on the job site rather than suffering the delay involved in ordering premixed paint of the proper color from a supplier. These attempts were at first unsuccessful and P & W encountered serious problems attaining the proper color and the proper coverage. The colors required by the Architect were very dark and were required to be placed over a white primer. Testimony establishes that covering a white primer with a dark color is difficult. While suffering problems from the confusion of the color change and its attempt to quickly provide the proper color paint, P & W also endured some problems with its workmanship for which it was responsible. In finally achieving an acceptable paint job on the doors, P & W put several coats of paint on the doors above the two required by the plans and specifications, and in some instances, after having painted the doors, took them down, stripped them to the bare wood and repainted them.
A significant part of this extra work on the painting of the doors was the result of the Architect's error in notifying Petitioner's paint subcontractor of the correct color for the doors, and then, upon correcting that error, insisting that there be no time delay because of the error. Petitioner has claimed an additional amount of money equal to the cost of material and labor of putting two coats of paint on the doors in addition to the two coats of paint required by the contract. In fact, the evidence establishes that the paint subcontractor did significantly more work than two additional coats of paint. The cost to P & W including materials, labor, taxes and insurance for two additional coats of paint on the subject doors was $6,082.00
Petitioner has sought additional compensation for extra painting within the dormitories in addition to that involving the doors. However, no evidence was presented which would establish that this extra painting was beyond the requirements of the contract or that any extra expense involved therein was the fault of Respondent or its agent.
In confronting the disputes which are the subject of this proceeding neither Petitioner nor Respondent adhered specifically to the requirements set forth in the Contract Documents or the contracts wherein there are specific requirements that disputes or claims for changes be reduced to writing and be perfected within a certain time frame. The actions, including oral and written statements, of Respondent were reasonably calculated to lead Petitioner to believe that the specific requirements of the contract did not have to be religiously adhered to in order for Petitioner to perfect its claims. It appears from the evidence presented that Petitioner fairly notified Respondent of those matters in dispute and for which claims are made and that Respondent had timely knowledge of the disputed matters and proceeded to debate them with Petitioner culminating in this proceeding.
Petitioner seeks relief from liquidated damages assessed Petitioner by Respondent for delay in completion the subject project. Petitioner asserts that a portion of this delay was the result of the unforeseen mildew and peeling paint problem, and the confusion surrounding the color to be used in painting the doors. While it appears from the evidence that these matters may have caused delay for which Petitioner should not be charged liquidated damages, the evidence is insufficient to establish that claim. The evidence does not show that the delay caused by the mildew and peeling paint and confusion over the color of paint ultimately caused delay in the completion of the entire project for which delay Petitioner has been assessed liquidated damages.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over this proceeding.
The claims and disputes which are the subject of this proceeding are properly cognizable by this forum through Section 8.5 of the Contract Documents and Section 120.57(1) Florida Statutes. The claims of Petitioner were adequately perfected in the course of the project through the actions of Respondent and Petitioner as set forth in the Findings of Fact above, even though those claims were not strictly perfected in accordance with the requirements of the Contract Documents. By its actions both parties have waived their right to claim strict adherence to the requirements of the Contract Documents with regard to the perfecting of claims.
The mildew and peeling paint problem which developed during the course of this project constituted, at the time the subject contract was entered into, a concealed condition unknown to both parties and at variance with conditions indicated by the Contract Documents. Under Article 12 of the Contract Documents Petitioner is therefore entitled to an equitable adjustment by change order.
The amount of this adjustment is Petitioner's actual cost, $33,098.00, plus ten percent for combined overhead and profit, five percent for the subcontractor's overhead and profit, and the bond cost of one percent. Section G, Supplementary General Conditions, Contract Documents.
The extra caulking of existing woodwork not disturbed by renovation referred to in the Findings of Fact above was not required by the Contract Documents, but is within the general scope of the contract. Therefore, in accordance with the Contract Documents, Petitioner is entitled to a change order in the amount of his actual cost, $9,118.00, plus ten percent for combined overhead and profit, five percent for subcontractor's overhead and profit and the bond cost of one percent. Section G, Supplementary General Conditions, Contract Documents.
The extra work done by Petitioner through his paint subcontractor, P & W, with regard to painting the doors, constituted, in part, work not required by the Contract Documents because of actions by the Architect, but is work within the general scope of the contract. Therefore, Petitioner is entitled to an equitable adjustment under Article 12 equal to the cost of two additional coats of paint on the subject doors. This cost is $6,082.00 plus ten percent of those costs for combined overhead and profit, five percent for the subcontractor's overhead and profit, and the bond cost of one percent. Section G, Supplementary General Conditions, Contract Documents.
Section 85. of the Contract Documents, entitled "Claims and Disputes", provides that there may be assessed
[T]he costs and charges of the proceeding upon either or both parties, as it may [be] deemed equitable under the circumstances, which costs and charges may include, but shall not be limited to, any professional, legal, or technical advice and counsel it may require. . .
Petitioner has made formal request for a hearing to receive evidence on the applicability of taxing interest, legal costs, and attorney fees against Respondent. Such a hearing will be scheduled by the Hearing Officer subsequent to the entry of this Recommended Order and a Supplemental Recommended Order will be entered by the Hearing Officer on that subject.
It is concluded that as a matter of Law Petitioner is entitled to no other compensation or adjustment under the subject contract than that referred to above.
RECOMMENDED ORDER
Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby
That Petitioner be awarded additional compensation for the subject project in the amount of $56,025.68, which includes the actual cost involved plus ten percent for the general contractor's overhead and profit, five percent for the subcontractor's overhead and profit, and one percent for bond cost.
Respectfully entered this 2nd day of February, 1979, in Tallahassee, Florida.
CHRIS H. BENTLEY
Hearing Officer
Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 2nd day of February, 1979.
COPIES FURNISHED:
John N. Boggs, Esquire Post Office Box 1638 Panama City, Florida 32401
Donna Stinson, Esquire Post Office Box 1118 Tallahassee, Florida 32302
STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
BURNS, KIRKLEY, and WILLIAMS ) CONSTRUCTION COMPANY, )
)
Petitioner, )
)
vs. ) CASE NO. 75-1987BID
) DEPARTMENT OF GENERAL SERVICES, )
)
Respondent. )
)
SUPPLEMENTAL RECOMMENDED ORDER
Petitioner herein seeks an assessment of costs and expenses against Respondent in this cause. In furtherance of that request a hearing was held on April 11, 1979. Having considered the matters presented at the hearing and the memoranda of the parties and being otherwise fully advised of these proceedings the Hearing Officer enters the following:
FINDINGS OF FACT
The Petitioner has been represented throughout this cause by John N. Boggs, Esquire, who is a member of the Florida Bar. Up to but not including April 11, 1979, Mr. Boggs had expended 273 hours in the prosecution of this matter on behalf of Petitioner, which hours in the prosecution of this matter on behalf of Petitioner, which hours are properly chargeable to Petitioner. (It should be noted that the Petitioner in this cause is the general contractor, Burns, Kirkley, and Williams Construction Company. The real party in interest however, is P & W Decorators, Inc., the subcontractor around whose work this dispute revolves. Mr. Boggs was actually retained by P & W Decorators, Inc. to appear on behalf of the general contractor in this proceeding.)
Mr. Boggs' time is properly and fairly charged at $60.00 an hour.
Thus, up to April 11, 1979, Petitioner had incurred attorney fees of $16,380.00.
Up to April 11, 1979, Petitioner had incurred costs of $2,984.39. These costs included long distance callos, photocopies, mileage for travel, witness fees, sheriff's fees for the serving of subpoenas, reporters fees and travel costs.
Evidence was presented establishing that P & W Decorators, Ins., the real party of interest herein, was fatally damaged in its business life as a result of the construction job which is the subject of this proceeding. P & W lost money in excess of the amount recommended to be awarded in the Recommended Order in this proceeding as a result of the subject construction contract.
The state paid $14,082.50 in legal fees and $1,637.99 in costs through March 7, 1979, to private attorneys representing the state in this cause.
CONCLUSIONS OF LAW
The Division of Adminsitrative Hearings has jurisdiction over this cause.
It is fundamental that costs, interest, and attorneys fees are not recoverable absent statutory authority, contract provisions, or stipulation by the parties. Mander v. Concreform, 206 So. 2d 662 (2 DCA, 1968), Rev'd 212 So.2d 631 (1968).
Paragraph 8.5 entitled "Claims and Disputes" of the contract, which is the subject of this proceeding, provides that
In the determination and settlement of any such dispute, the said Review Panel May
assess the costs and charges of the proceeding upon either or both parties, as it may deem equitable under the circumstances, which costs and charges may include, but shall not be limited to, any professional, legal or technical advice and counsel it may require; and if it deems it equitable, it may award
to the successful party, in any dispute, damages for delays, or for necessary costs and expenses, caused by the proceeding, if it finds that the appeal or refusal to
accept the Architect's determination was without reasonable cause.
The attorneys fees and costs outlined in paragraphs 2 and 3 above fall within the definition of "costs and charges" and "necessary costs and expenses, caused by the proceeding as those phrases are used in paragraph 8.5 of the contract.
Petitioner argues that in addition to the attorneys fees and costs heretofore noted, he is also entitled to interest on the amount of additional compensation which the Recommended Order finds should be awarded. It is the general rule, grounded on public policy considerations, that, in the absence of a statute or an express contract to the contrary, a public body is not liable for interest on its obligations. Paragraph 8.5 of the contract finds that the Review Panel, may assess the cost and charges of the proceeding as it may deem equitable, and, also as it deems equitable, may award the successful party damages for delays, and necessary costs and expenses of the proceeding. Petitioner argues that interest is included in the foregoing language. However, it is concluded as a matter of law that the contract does not expressly allow the assessment of interest in favor of the successful party and that therefore, in light of the general rule on the assessment of interest against public bodies, the Respondent is not liable for interest in this proceeding.
The Petitioner is the "successful party" in this proceeding as that phrase is used in paragraph 8.5 of the contract.
Therefore, based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby
RECOMMENDED:
That Petitioner be awarded $16,380.00 for attorneys fees and $2,984.39 for costs incurred as a result of this proceeding.
ENTERED this 2nd day of August, 1979, in Tallahassee, Florida
CHRIS H. BENTLEY, Director
Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301
(904) 488-9675
COPIES FURNISHED:
John N. Boggs, Esquire Post Office Box 1638
Panama City, Florida 32401
Spiro T. Kypreos, Esquire Office of General Counsel Department of General Services Room 457 Larson Building Tallahassee, Florida 32301
=================================================================
AGENCY FINAL ORDER
=================================================================
STATE OF FLORIDA DEPARTMENT OF GENERAL SERVICES
BURNS, KIRKLEY AND WILLIAMS CONSTRUCTION COMPANY,
Petitioner,
vs. CASE NO. 75-1987BID
STATE OF FLORIDA DEPARTMENT OF GENERAL SERVICES,
Respondent.
/
PARTIES PROPOSED FINDINGS OF FACT, CONCLUSIONS OF LAW, AND ORDER
This cause came on for final hearing on December 14, 15 and 16, 1977, and a supplemental hearing on April 11, 1979, before a hearing officer appointed by the Division of Administrative Hearings.
Pursuant to stipulation of counsel, all depositions and documents previously filed in this cause were admitted into evidence. The dispute in this cause centered around three areas of work pertinent to a construction contract between Petitioner and Respondent in which additional compensation and time extensions are sought by Petitioner. First, Petitioner claims additional compensation for cleaning of mildew and scraping, patching and sanding the interior surfaces of the four subject dormitories. Petitioner contends that the necessity for such work was not apparent at the time of bid and was caused by unforeseeable forces outside-its control, thereby causing extra work.
Respondent contends that due to the age and condition of the dormitories some increase in mildew and peeling paint , was forseeable, and that the excessive amount was due to Petitioner's negligence and failure to comply with contract requirements of keeping the building closed and protected from inclement weather.
Second, Petitioner contends that no interior caulking of existing woodwork was required by the plans and specifications, but that the architect nevertheless required such caulking. Respondent contends that Petitioner was required to only caulk new woodwork or woodwork which was somehow altered during construction. Petitioner claims additional compensation as warranted for labor and materials expended to comply with the architect's demands beyond the requirements of the plans and specifications.
Third, the parties are in dispute concerning painting of interior doors.
Petitioner contends that as many as eight coats of paint were required to
achieve an acceptable finish on the interior dormitory doors, thus warranting additional compensation for the labor and materials expended.
In addition to the extra compensation in dispute above, Petitioner seeks an offset of liquidated damages assessed for the job overrun, interest, costs, and attorneys' fees. All motions not previously disposed of are hereby
Having considered all testimony and evidence admitted to the record, as well as the argument and memoranda of counsel, and being otherwise fully advised in these proceedings, the agency head enters the following:
FINDINGS OF FACT
Burns, Kirkley and Williams Construction Company (hereinafter referred to as "Petitioner") operates a general contracting business. Petitioner entered into a construction contract with the Department of General Services (hereinafter referred to as "Respondent") for the renovation of four dormitories, Diamond, McGuinn, Young and Sampson, and the construction of a new "Core Building" on the campus of Florida Agricultural and Mechanical University in Tallahassee, Florida. This contract is referred to as Project BR-920l, Phase
I. The dispute in this cause does not involve the construction of the Core Building. P & W Decorators (hereinafter referred to as "P & W") is a commercial painting contractor. The architectural firm of Robert G. Graf and Associates (hereinafter referred to as "Architect") compiled the contract documents, including the plans and specifications.
The dormitory buildings being renovated under the subject contract were vacated by students in June of 1974 and not thereafter occupied. The buildings were all more than twenty years old. The heat in these buildings was shut off in November, 1974 and no effort was made by Respondent to maintain climate control in the dormitory buildings from November, 1974 up to the Notice to Proceed issued Petitioner on February 20, 1975.
The bid-letting on this construction contract was held on December 19, 1974. In early December, 1974, prior to the bid-letting, a project manager for Petitioner spent one week on the job site and went through every room of every building subject to the contract for the purpose of evaluating the project for bid. The project manager at that time found no significant problem with mildew or peeling paint. At least three paint subcontractors, including P & W, visited the site prior to bid and found no significant problem with mildew or peeling paint. The evidence establishes that up to and including the time of the bid- letting there was no apparent problem with mildew or peeling paint on the project. The evidence further establishes that as far as painting was concerned the ceilings and walls of the building appeared to be in good shape, presenting no special problem relative to a renovation project.
At the bid-letting on December 19, 1974, Petitioner was the apparent low bidder. Respondent delayed award of the job asking and receiving from the Petitioner an extension of time to consider award. Petitioner received its formal Notice to Proceed from Respondent on February 20, 1975. Prior to the bid-letting Petitioner received prices from at least three painting
subcontractors, including P & W. These three firms were responsible, experienced paint subcontractors. All had looked at the job site prior to preparing a price, and none included in their price any amount for a serious mildew and peeling paint problem. None foresaw any difficulty in preparing the ceilings and walls for painting. On February 12, 1975, Petitioner entered into a
subcontract with P & W in the amount of $83,325.00 for the painting part of the subject project.
Although the Notice to Proceed was dated February 20, 1975, Petitioner's mechanical subcontractor went on the job site of February 6, 1975. At that time he found excessive moisture in the buildings. According to his testimony the walls and floors were dripping with moisture. On March 3, 1975, Petitioner's project manager wrote the Architect to inform him that on walking through two of the four dormitories he,
. . . noticed that practically all bedrooms in these buildings are accumulating a great deal of mildew on the walls. This problem has just begun and seems to be continuing. Next week I will be going to Young and Sanford [two other dormitories] and see if this problem is occurring in these buildings. At this time we do not know the extent of problems the mildew might cause. Therefore, we are writing to inform you and all concerned of this problem. (See Petitioner's Exhibit 6.)
Soon after Notice to Proceed issued to Petitioner, mildew began growing rapidly in the subject buildings. This led to problems with peeling paint. As warm weather came with Spring and Summer, the growth of the mildew and the resulting peeling paint was very rapid. On March 27, 1975, a construction conference was held between representatives of Petitioner, Respondent, Florida Agricultural and Mechanical University, the mechanical subcontractor and the Architect. The matters discussed at that construction conference were memorialized by formal notes made by Robert F. Graf, Architect, dated March 31, 1975. (See Petitioner's Exhibit 8.) In those notes Mr. Graf stated that,
The Architect reported that the general contractor has placed in writing his concern about the rapid growth of mildew in the buildings and affect [sic] which the mildew may have on the paint in the future. The Architect is in the process of investigating the cause of the mildew growth to determine if the growth and/or responsibility of the painted surfaces is the responsibility of the contractor or others. A report will be made in the near future concerning this matter.
During March, April, and May Petitioner's paint subcontractor, P & W, repeatedly raised the problem of the mildew and peeling paint, both from the point of view of additional compensation for extra work caused by the problem. No response was forthcoming from the Architect until June 6, 1975, by which time the problem was almost at its height. By letter dated June 6, 1975, (see Respondent's Exhibit 3) the Architect noted that the growth of mildew and the peeling paint had increased "profoundly" since the bid-letting. He further stated that in his opinion' the excessive mildew growth was,
. . . directly attributable to the excess moisture in the building resulting from the termination of the heating system, and open
windows emitting excessive moisture since January, 1975. The conditions for mildew growth under these conditions were ideal.
Referring to the contract documents, wherein there is required of the contractor surface preparation and cleaning prior to painting, the Architect then concluded that Respondent was not required to incur additional expense to clean, patch, kill mildew or remove peeling paint. In that letter the Architect was under the mistaken impression that the termination of heat in the buildings was in January, 1975. In fact heat to the buildings had been terminated in November, 1974.
Between the termination of heat in November, 1974, and the Notice to Proceed dated February 20, 1975, Petitioner had no legal responsibility and assumed no actual responsibility for the maintenance or climate control of the subject buildings. During that period of time the buildings had no heat and excessive amounts of moisture accumulated in them. Within two weeks of the Notice to Proceed, Petitioner observed a burgeoning mildew and peeling paint problem and promptly notified the Architect.
After assuming control of the job site, subject to the Notice to Proceed, Petitioner maintained the appropriate climate control in the subject buildings for the trades working therein. The evidence establishes that the basic cause of the mildew and peeling paint problem existed at the time Petitioner received the Notice to Proceed, and was not exacerbated by any negligent action on his part once on the job site.
It is clear from the evidence presented that, although the basic cause of the serious mildew and peeling paint problem existed prior to Petitioner receiving the Notice to Proceed, the problem could not have been reasonably foreseen by Petitioner at the time of bid-letting. At that time the problem lay dormant awaiting the warming of Spring to trigger the growth of mildew. The basic cause of the problem appears to have been the termination of heat in the buildings by their owners in November, 1974, the accumulation of excessive moisture in the ensuing months, and the onset of warm weather with Spring. Apparently a unique set of circumstances, including the age of the building, combined to cause an extraordinary and explosive growth of mildew. Such could not have reasonably been foreseen by Petitioner and was not apparent at the time the contract was entered into by the parties.
In the face of the serious mildew and peeling paint problem, Petitioner, through its paint subcontractor, P & W, had to kill the mildew and scrape the peeling paint in order to properly prepare the surfaces for painting. The evidence presented establishes that Petitioner, through his paint subcontractor, P & W, expended $33,098.00 in labor, materials, taxes, and insurance in eliminating the mildew and peeling paint problem in the four dormitory buildings. (See Petitioner's Exhibit 14 for breakdown of cost.) The work required to solve the mildew and peeling paint problem was work over and beyond that required by the Contract Documents.
During the course of the job a dispute arose between Petitioner, through his paint subcontractor, P & W, and Respondent, over how much caulking was required by the Contract Documents. It was not disputed that new woodwork should be caulked if it did not fit properly. The dispute centered around the caulking of existing woodwork not disturbed by the renovation.
Section 7TO of the Contract Documents, entitled "Joint Sealers," states the following concerning caulking:
Description of work:
The required applications include, but are not necessarily limited to the following:
Sidewalk joints subjected to foot traffic. Exterior building wall joints.
Flashing joints.
Miscellaneous concrete construction joints. Floor (interior) joints.
Partition and ceiling joints. Equipment and isolation joints.
Further, the blueprints, which are part of the plans and specifications, require caulking around "window frame and sill." This letter is properly interpreted to refer to the exterior portion of the window for which no claim is made.
Throughout this project a dispute existed between Petitioner and Respondent over the requirements of the contract with respect to caulking. Finally, by letter dated May 21, 1976, Petitioner, through the project manager, wrote the Architect stating that to avoid any dispute or misunderstanding concerning caulking of existing wood base, interior windows, shelving, and picture mold, Petitioner did "hereby request written instructions whether to caulk or not to caulk." (See Petitioner's Exhibit 19.) The letter further stated Petitioner's position that the plans and specifications did not require the above to be caulked. On June 4, 1976, (see Petitioner's Exhibit 20) the Architect replied to Petitioner's letter stating that
. . . the plans are very clear as to what repair and caulking is required . . . We do not expect any work to be done that is not called for in the specifications. If there is misfitting woodwork that can be solved by caulking, we will allow it. If you do no [sic] want to caulk, then we are forced to have the items removed and rebuilt."
No more definitive response to Petitioner's request for instructions was received.
Because of the position taken by the Architect, Petitioner caulked interior windows and existing woodwork while asserting that he was entitled to additional compensation for such work. The major item involved in this dispute over caulking concerns existing trim which ran around the walls of each room at the floor, at picture height, and at the ceiling. The evidence presented, including testimony by the employee of Respondent who represented the Respondent on the job site, establishes that Petitioner was required by the Architect to caulk all existing woodwork where there was a gap, including the trim referred above. Further, the evidence presented by engineers and other members of the general contracting and painting industry established that the requirements of the plans and specifications referred to in Paragraph 13 above are normally interpreted to apply to new woodwork, not existing woodwork. Testimony establishes that if it was expected that existing woodwork be caulked the plans and specifications would normally have contained a specific statement so that the contractors bidding the job would be on notice of that requirement. The
three paint subcontractors who submitted prices to Petitioner for that portion of the contract which includes the caulking, uniformly excluded from their price an amount which would represent the cost of caulking existing woodwork. They did not believe the plans and specifications of the contract called for such caulking.
Some evidence was presented by the Architect that no general requirement for caulking of all existing woodwork was imposed by him. Although that may not have been the intent, the evidence presented establishes that the state project manager for Respondent present on the job site believed that the Architect imposed such a requirement. It is also interesting to note that a punch list for final inspection on one of the dormitories included a General Note to "caulk top of baseboard and all holes around wood trim." (See Petitioner's Exhibit 21.) Such a requirement was interpreted by all concerned on site to mean to caulk all existing woodwork.
The evidence presented establishes that Petitioner, through his subcontractor, P & W, expended $9,118.00 in labor and materials, taxes and insurance in performing caulking of existing woodwork not otherwise disturbed by renovation.
Petitioner expended 5,201 man hours of labor in killing mildew, scraping, painting and sanding because of the mildew and peeling paint problem. Petitioner further expended 1,043 man hours of labor in performing the caulking of existing woodwork not otherwise disturbed by renovation.
A color specification chart was submitted by the Architect to Petitioner on July 14, 1975. (See Petitioner's Exhibit 4.) This color schedule did not contain a color chart for the interior dormitory rooms. This was an oversight on the part of the Architect. Subsequent to the receipt of that chart P & W contacted the Architect who told them that the interior dormitory doors were to be painted the same color as the ceiling and wall, and that P & W could go ahead and order all of the paint. In reliance on that statement P & W did order a significant amount of paint in a color called Sugar Mint. After receiving that paint P & W applied one coat to all of the dormitory doors in one of the dormitories. As a result of that the Architect became aware that the doors were being painted Sugar Mint and, on November 10, 1975, notified Petitioner that the doors should be painted Federal Blue or Cordoba Brown. This misunderstanding was the result of the Architect's failure to include a color schedule for the dormitory doors on the color specifications submitted on July 14, 1975. The change in the color specifications on November 10, 1975, caused some delay on the project while P & W attempted to quickly acquire the right color paint. In an attempt to prevent further delay on the project P & W hastily acquired paint from several paint stores and hand mixed the paints for color on the job. Normally paints would have been ordered premixed as to color from the supplier.
Petitioner does not seek any compensation for the Sugar Mint color paint or its application to the doors in one of the dormitories. Petitioner does seek compensation, however, because P & W in order to achieve an acceptable finish on the hundreds of interior doors in four dormitories, applied at least two extra coats of paint to those doors in addition to the two coats of paint called for in the Contract Documents, and in some instances, applied as many as eight additional coats.
In November, 1975, when the Architect countermanded his previous color specification with regard to the dormitory doors, the Architect was also
demanding that Petitioner hurry with completion of the project and would brook no delay because of the confusion caused with regard to paint color. This problem with the paint color was the direct result of the Architect's failure to include the proper color on his original specification, and the erroneous notification to P & W to use Sugar Mint. In no way was Petitioner or P & W responsible for this problem. When the color schedule was corrected in November, 1975, P & W was told by the Architect that they had to continue in a timely fashion with the project even though the change in color created problems for P & W. In an attempt to comply with this directive from the Architect P & W tried to mix the proper color paint on the job site rather than suffering the delay involved in ordering premixed paint of the proper color from a supplier. These attempts were at first unsuccessful and P & W encountered serious problems attaining the proper color and the proper coverage. The colors required by the Architect were very dark and were required to be placed over a white primer. Testimony establishes that covering a white primer with a dark color is difficult. While suffering problems from the confusion of the color change and its attempt to quickly provide the proper color paint, P & W also endured some problems with its workmanship for which it was responsible. In finally achieving an acceptable paint job on the doors, P & W put several coats of paint on the doors above the two required by the plans and specifications, and in some instances, after having painted the doors, took them down, stripped them to the bare wood and repainted them.
A significant part of this extra work on the painting of the doors was the result of the Architect's error in notifying Petitioner's paint subcontractor of the correct color for the doors, and then, upon correcting that error, insisting that there be no time delay, because of the error. Petitioner has claimed an additional amount of money equal to the cost of material and labor of putting two coats of paint on the doors in addition to the two coats of paint required by the contract. In fact, the evidence establishes that the paint subcontractor did significantly more work than two additional coats of paint. The cost to P & W including materials, labor, taxes and insurance for two additional coats of paint on the subject doors was $6,082.00.
Petitioner has sought additional compensation for extra painting within the dormitories in addition to that involving the doors. However, no evidence was presented which would establish that this extra painting was beyond the requirements of the contract or that any extra expense involved therein was the fault of Respondent or its agent.
It appears from the evidence presented that Petitioner timely notified Respondent of those matters in dispute and for which claims are made.
Petitioner seeks relief from liquidated damages assessed Petitioner by Respondent for delay in completion of the subject project. Petitioner asserts that a portion of this delay was the result of the unforeseen mildew and peeling paint problem, and the confusion surrounding the color to be used in the painting of the doors. While it appears from the evidence that these matters may have caused delay for which Petitioner should not be charged liquidated damages, the evidence is insufficient to establish that claim. The evidence does not show that the delay caused by the mildew and peeling paint and confusion over the color of paint ultimately caused delay in the completion of the entire project for which delay Petitioner has been assessed liquidated damages.
The Petitioner has been represented throughout this cause by John N. Boggs, Esquire, who is a member of the Florida Bar. Up to but not including
April 11, 1979, Mr. Boggs had expended 273 hours in the prosecution of this matter on behalf of Petitioner, which hours are properly chargeable to Petitioner. (It should be noted that the Petitioner in this cause is the general contractor, Burns, Kirkley and Williams Construction Company. The real party in interest however, is P & W Decorators, Inc., the subcontractor around whose work this dispute revolves. Mr. Boggs was actually retained by P & W Decorators, Inc. to ,appear on behalf of the general contractor in this proceeding.)
Mr. Boggs' time is properly and fairly charged at $60.00 an hour. Thus, up to April 11, 1979, Petitioner had incurred attorney fees of $16,380.00.
Up to April 11, 1979, Petitioner had incurred costs of $2,984.39. These costs included long distance calls, photocopies, mileage for travel, witness fees, sheriff's fees for the serving of subpoenas, reporters fees and travel costs.
The parties have stipulated that Petitioner should be awarded attorneys' fees in the form of $16,380.00, and costs of $2,984.39.
The Contract Documents incorporated by reference the AIA General Conditions (April, 1970 ed.). Article 7.9 therein provides:
INTEREST
Any moneys not paid when due to either party under this Contract shall bear interest at the legal rate in force at the place of the Project.
Section F-9 of the specifications deletes Article 7.9 in its entirety.
CONCLUSIONS OF LAW
The Department of General Services has jurisdiction over this proceeding.
The claims and disputes which are the subject of this proceeding are properly cognizable by this forum through Section 8.5 of the Contract Documents and Section 120.57(1) Florida Statutes. The claims of Petitioner were timely presented.
The mildew and peeling paint problem which developed during the course of this project constituted, at the time the subject contract Was entered into, a concealed condition unknown to both parties and at variance with conditions indicated by the Contract Documents. Under Article 12 of the Contract Documents Petitioner is therefore entitled to an equitable adjustment by change order.
The amount of this adjustment is Petitioner's actual cost, $33,098.00, plus ten percent for subcontractor's overhead and profit, five percent for the general contractor's over and profit, and the bond cost of one percent. Section G, Supplementary General Conditions.
The extra caulking of existing woodwork not disturbed by renovation referred to in the Findings of Fact above was not required by the Contract Documents, but is within the general scope of the contract. Therefore, in accordance with the Contract Documents, Petitioner is entitled to a change order in the amount of his actual cost, $9,118.00, plus ten percent for subcontractor's overhead and profit, five percent for general contractor's
overhead and profit and the bond cost of one percent. Section G, Supplementary General Conditions, Contract Documents.
The extra work done by Petitioner through his paint subcontractor, P & W, with regard to painting the doors, constituted, in part, work not required by the Contract Documents because of actions by the Architect, but is work within the general scope of the contract. Therefore, Petitioner is entitled to an equitable adjustment under Article 12 equal to the cost of two additional coats of paint on the subject doors. This cost is $6,082.00 plus ten percent of those costs for subcontractor's overhead and profit, five percent for the general contractor's overhead and profit, and the bond cost of one percent. Section G, Supplementary General Conditions, Contract Documents.
It is fundamental that costs, interest, and attorneys' fees are not recoverable absent statutory authority, contract provisions, or stipulation by the parties. Mander v. Concreform, 206 So.2d 662 (2 DCA, 1968), Rev'd 212 So.2d 631 (1968). The parties hereto have stipulated to an award of attorneys' fees and costs.
Petitioner argues that in addition to the attorneys' fees and costs heretofore noted, he is also entitled to interest on the amount of additional compensation which the Recommended Order finds should be awarded. It is the general rule, grounded on public policy considerations, that, in the absence of a statute or an express contract to the contrary, a public body is not liable for interest on its obligations. Paragraph 8.5 of the contract finds that the Review Panel, may assess the cost and charges of the proceeding as it may deem equitable, and, also as it deems equitable, may award the successful party damages for delays, and necessary costs and expenses of the proceeding. Petitioner argues that interest is included in the foregoing language. However, it is concluded as a matter of law that the contract does not expressly allow the assessment of interest in favor of the successful party and that therefore, in light of the general rule on the assessment of interest against public bodies, the Respondent is not liable for interest in this proceeding. Moreover, Section F-9 of the specifications disallows assessment of interest.
It is concluded that as a matter of law Petitioner is entitled to no other compensation or adjustment under the subject contract than that referred to above.
FINAL ORDER
Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby
ORDERED:
Subject to Rule 13-4 , Florida Administrative Code, the Petitioner is awarded additional compensation for the subject project in the amount of
$56,025.68, which includes the actual cost involved plus ten percent for the subcontractor's actual costs for combined overhead and profit, five percent for Burns, Kirkley & Williams Construction Company, Inc. `s overhead and profit and one percent for bond cost.
Subject to Rule 13-4 , Florida Administrative Code, Petitioner is awarded $16,380.00 for attorneys' fees and $2,984.39 for costs.
Subject to Rule 13-4 , Florida Administrative Code, and pursuant to the stipulation filed herein, any state warrant for satisfaction in whole or in part of the order shall be made payable to the order of John N. Boggs, Esquire, P & W Decorators, Inc., and Burns, Kirkley & Williams Construction Company, Inc.
GOVERNOR AND CABINET
THOMAS R. BROWN
Executive Director
COPIES FURNISHED:
Chris H. Bentley, Esquire John N. Boggs, Esquire General Counsel
| Issue Date | Proceedings |
|---|---|
| Jun. 01, 1990 | Final Order filed. |
| Feb. 02, 1979 | Recommended Order sent out. CASE CLOSED. |
| Issue Date | Document | Summary |
|---|---|---|
| Jun. 01, 1990 | Agency Final Order | |
| Feb. 02, 1979 | Recommended Order | Petitioner is entitled to cost of work done on dormitory refurbishment project. |
