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Date: 03-30-2020
Case Style:
SUMMERS DRILLING & BLASTING, INC. v. GOODWIN & GOODWIN, INC.
Case Number: 2020 Ark. App. 194
Judge: PHILLIP T. WHITEAKER
Court: ARKANSAS COURT OF APPEALS
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Goodwin is a general contractor employed by the Arkansas Highway and
Transportation Department (AHTD) and the City of Fayetteville to assist in the Porter
Road–Highway 112/71B Widening and Interchange Project (“the Project”) in Fayetteville,
Arkansas. In December 2016, Goodwin obtained and accepted a bid from SD&B in
which SD&B agreed to drill and blast rock along a designated route of the Project for the
relocation of an existing sewer line, and Goodwin agreed to pay SD&B $181 per blasted
foot with a 1,350-foot minimum.
SD&B began work on the project. After having completed 1,204 linear feet of work,
it sent Goodwin an invoice requesting $217,924 for services rendered. Goodwin paid
$185,235.40, or 85 percent of the invoice less a 15 percent retainage. Approximately
halfway through the project, Goodwin discovered that certain areas blasted by SD&B were
not as deep as required. As a result, Goodwin rented equipment and employed crews to
hammer to the required depth, resulting in a delay of the project. SD&B subsequently
removed its equipment from the job site.1 At the time of withdrawal, SD&B had submitted
two other invoices in the amounts of $28,598 for 158 linear feet, and $32,761 for 181
linear feet. Goodwin did not pay these two invoices. In total, SD&B invoiced Goodwin
1When SD&B withdrew from the project, it had blasted 1,540 feet, but the project
plans specified relocation of approximately 1,650 linear feet of sewer line.
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$279,283 for the work completed, but Goodwin paid only $185,235.40, or 85 percent of
the original invoice.
In July 2017, Goodwin filed suit against SD&B for breach of contract. Goodwin
alleged that SD&B had breached its contract by failing to blast to the depths specified by
the Project plans and in failing to complete the work. SD&B denied any breach,
contending that the written contract specified only a minimum distance to be blasted—
1,350 feet—and made no mention of a required depth. Because it had blasted the
minimum distance specified in the bid and because drilling to a required depth was not an
express term of the contract, SD&B claimed that there could be no breach.
The parties presented their dispute to the court at a bench trial. The circuit court
was presented conflicting positions and evidence concerning the terms of the agreement
between the parties and the performance of the parties pursuant to the terms of the
agreement. Goodwin took the position and presented evidence that its contract with
SD&B required performance under the terms and specifications of the Project plans that
Goodwin had with AHTD and the City of Fayetteville; that those Project plans detailed the
depth at which the sewer pipes were to be positioned; and that SD&B failed to meet the
depth specifications of the Project plans. SD&B took the position and presented evidence
that its bid constituted the written contract between the parties and that this written
contract was silent as to required depths. SD&B also contended that Goodwin never
provided the depth specifications of the Project plans and had not provided a suitable
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blasting site in that there was an unacceptable amount of overburden2
hindering its ability
to effectively blast. Goodwin disagreed and presented evidence that it had provided the
Project plans to SD&B and contended that SD&B had specified in the agreement that the
naturally occurring overburden should remain in place in order to prevent flooding of the
ditches.
After hearing all the evidence and reviewing the documents provided, the court
made specific findings concerning the parties’ agreement: (1) the parties had entered into a
contract; (2) the contract obligated SD&B to blast rock to grade; and (3) SD&B breached
the contract by not blasting to the required depths under the contract and had left the job
prior to completion. Concerning overburden, the court found that while there was some
dispute as to the removal of overburden, Goodwin had performed as required under the
contract. Concerning damages, the court found Goodwin was damaged as a result of
SD&B’s breach. The court calculated damages equal to the amount Goodwin incurred to
complete the project less the amount it would have paid SD&B if the contract had been
performed without breach, awarding Goodwin $132,792.26 in damages. SD&B appeals.
II. Standard of Review
SD&B appeals the judgment of damages from a breach-of-contract cause of action
entered after a bench trial. In appeals from civil bench trials, our standard of review on
appeal is not whether there is substantial evidence to support the findings of the court but
2The term “overburden” is used to describe soil and ancillary material above the
bedrock in a given area.
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whether the court’s findings were clearly erroneous or clearly against the preponderance of
the evidence. Barnes v. Wagoner, 2019 Ark. App. 174, at 3, 573 S.W.3d 594, 595–96. A
finding is clearly erroneous when, although there is evidence to support it, the
reviewing court on the entire evidence is left with a firm conviction that a mistake has been
made. Id. Where the issue is one of law, our review is de novo. Id.
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III. Analysis
A. Negligence v. Breach of Contract
In its first point on appeal, SD&B argues that Goodwin’s cause of action actually
sounds in negligence rather than in contract and that Goodwin failed to plead or prove a
negligence claim. Essentially, SD&B argues that Goodwin’s challenge is to the sufficiency
of its performance under the contract and not to the breach of any specific provision of the
contract. SD&B then concludes that because it did not breach a specific provision of the
contract, the judgment against SD&B should be reversed, along with the court’s award of
attorney’s fees, which are available only in breach-of-contract actions.
We begin analyzing SD&B’s argument by noting that the question of whether a
cause of action sounds in tort or in contract usually arises in the context of either
determining the appropriate application of the statute of limitations or in the award of
attorney’s fees. In reviewing the circuit court’s analysis as it relates to its characterization of
the nature of the claim, we look to the facts alleged in the complaint to ascertain the area
of the law in which it sounds. See Sturgis v. Skokos, 335 Ark. 41, 48, 977 S.W.2d 217, 220
(1998); McQuay v. Guntharp, 331 Ark. 466, 470, 963 S.W.2d 583, 584 (1998).
In order to prove a breach-of-contract claim, one must prove “the existence of an
agreement, breach of the agreement, and resulting damages.” Barnes, 2019 Ark. App. 174,
at 3, 573 S.W.3d at 595. As a result, Goodwin needed to file a complaint that asserted the
existence of a valid and enforceable contract between the parties, the obligation of SD&B
thereunder, a violation by SD&B, and damages resulting to Goodwin from the
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breach. Rabalaias v. Barnett, 284 Ark. 527, 528–29, 683 S.W.2d 919, 921 (1985). When the
complaint contains a claim for breach of contract, the question is whether there is a
specific promise that transforms the gist of the action from one for negligence into one for
breach of the written agreement. Sturgis, 335 Ark. at 49, 977 S.W.2d at 221.
In its complaint, Goodwin alleged that it contracted with SD&B to “remove rock
along a course prescribed by AHTD and City of Fayetteville plans relative to a project
identified as AHTD Job # BB0414, being more completely discharged as ‘Porter Road –
Highway 112/71B Widening and Interchange Water and Service Relocation, in accordance
with specifications therefor, and to do so at a price of $181.00 per foot.” (Emphasis added.)
Goodwin further alleged that without legal justification, SD&B pulled its equipment from
the job and abandoned the contract without completing it and that SD&B had not blasted
the rock to depths specified by AHTD and the City of Fayetteville. Finally, Goodwin
alleged that these breaches caused a delay in the project and additional expenditures. These
allegations do not merely allege deficient performance under the contract; instead, they
allege the failure to perform as required under the provisions of the parties’ agreement
regarding the relocation of sewer lines as set forth in the Project documents. These
allegations clearly sound in contract and not in tort.
B. Breach
SD&B next asserts that even if Goodwin’s claim sounds in contract, the evidence
did not support the circuit court’s finding of a breach. First, SD&B posits that the court
erred in finding that it was obligated to blast to certain depths. Second, SD&B posits that
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the court erred in finding that it was obligated to blast for designated distances. We will
address these two arguments separately.
Regarding depth requirements, SD&B asserts that its contract with Goodwin was
unambiguous and did not contain any requirement for it to blast to any particular depth.
Therefore, Goodwin failed to prove a breach of contract.
As noted above, our standard of review on appeal is not whether there is substantial
evidence to support the findings of the court but whether the court’s findings were clearly
erroneous or clearly against the preponderance of the evidence. The circuit court’s
findings in this case were not clearly erroneous.
SD&B submitted a written bid for the blasting work, which specifically referenced
the Project number at issue. The Project had certain specifications regarding the relocation
of the sewer lines, including the depth at which those lines must be placed. Goodwin
accepted the bid. While the bid itself was silent as to the depth to be drilled/blasted, this
silence is of no moment because parol evidence is admissible if it tends to prove a part of
the contract about which the written contract is silent. Gawenis v. Alta Res., LLC, 2013
Ark. App. 379, at 3.
Here, Goodwin presented evidence that the plans for the Project were made
available to SD&B prior to bidding. Floyd Summers, the proprietor of SD&B, denied
having seen the Project plans prior to submitting his bid. He did, however, admit visiting
the work site prior to submitting the bid and was aware that the Project required the area
to be blasted to “pre-established depths” or “grade,” plus approximately six inches deeper
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for the pipe. Thus, the court did not erroneously consider the Project depth specifications
in analyzing Goodwin’s breach-of-contract claim.
Next, SD&B argues that, even assuming it was required by the contract to attain the
depths alleged by Goodwin, it presented to the court a drilling summary indicating that it
had attained the correct depths. Admittedly, SD&B did present the court with this
evidence. The court, however, heard other evidence, including testimony from Gary Jones,
Goodwin’s construction foreman on the project. He testified that certain areas were not
“shot to grade” and that Goodwin was forced to hammer to reach the requisite depth.
Even Floyd Summers testified that by early February, he knew Goodwin was hammering
where his crew had been blasting because SD&B had not reached grade.
We acknowledge that SD&B attempts to place the blame for its failure to reach
grade on Goodwin’s failure to remove the overburden. SD&B presented testimony that
under the contract, Goodwin had an obligation to maintain the site for blasting by
removing the appropriate amount of overburden retained in the trench and that Goodwin
failed to meet this obligation. The court acknowledged that the facts regarding the removal
of the overburden were disputed and found that Goodwin had performed as required.
This was a question of fact for the court to decide. Roach v. Whitehead, 2019 Ark. App. 525,
at 4, 588 S.W.3d 841, 844 (It is within the sole province of the factfinder to weigh credibility and resolve disputed facts.). Thus, we find no error in the court’s
conclusion that SD&B breached the depth requirements of the contract.
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Regarding distance requirements, SD&B’s argument is difficult to follow. In its
brief, SD&B states: “At trial, Goodwin argued that Summers Drilling breached the
Contract by not blasting deep enough or for a long enough distance (stating the linear course
was a total of 1,636 feet). The circuit court agreed, and in doing so, disregarded both the law
and the evidence.” (Emphasis added.) SD&B then proceeds to argue that the contract
provided that the price for ditch-line blasting would be $181 per linear foot and noted that
the quoted price was based on a 1,350-foot minimum. Because it blasted more than the
1,350 feet, SD&B contends that it did not breach the contract by failing to blast “1,636
feet.” It appears that SD&B is arguing that the court found it in breach of contract for
failing to blast a total of 1,636 feet. This is incorrect. The court never made this finding.
The court did find that SD&B “left the job prior to completion.” SD&B does not
challenge this specific finding of the court; rather, it conflates the court’s finding with a
distance requirement. Because SD&B does not challenge the court’s specific finding that it
left the job prior to completion, we cannot conclude that the circuit court clearly erred in
this finding.
C. Damages
SD&B’s final argument is that the circuit court erred in the calculation of damages.
While we agree with the circuit court’s method of measuring damages, we conclude that it
erred in its actual calculations.
The circuit court found that the proper measure of damages for breach of the
construction contract was the amount Goodwin incurred to complete the work less the
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amount it would have paid to SD&B if no breach had occurred. We agree. See Keith Capps
Landscaping & Excavation, Inc. v. Van Horn Constr., Inc., 2014 Ark. App. 638, 448 S.W.3d
207; MDH Builders, Inc. v. Nabholz Constr. Corp., 70 Ark. App. 284, 292, 17 S.W.3d 97, 102
(2000). Utilizing this measure of damages, the circuit court found that Goodwin spent
$432,008.26 to complete the job and that under the contract, it owed SD&B $299,216.01.
The court then awarded Goodwin the difference between the two amounts as damages.
After having reviewed the record before us, we cannot determine how the circuit
court calculated the $432,008.26 amount it specified that Goodwin incurred to complete
the project. We acknowledge that this figure was cited by Goodwin’s counsel in its posttrial
brief—a fact referenced by the circuit court in its award of damages—but neither the
posttrial brief nor the court’s order refers to any specific evidence introduced at trial to
explain how such a figure was calculated. The record before us contains conflicting
evidence as to amounts incurred in completion of the project, and we have been unable to
recreate the court’s finding under any scenario supported by the evidence in the record.
Because it is not entirely clear that the amount the circuit court used in calculating
damages was based on the evidence presented and not simply on the arguments of counsel,
we reverse and remand for a recalculation of the damages award.
Affirmed in part; reversed and remanded in part.
MURPHY, J., agrees.
HIXSON, J., concurs.
Outcome: Affirmed in part; reversed and remanded in part.
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