No. 82CA0985Colorado Court of Appeals.
Decided February 20, 1986. Opinion Modified, and As Modified Rehearing Denied March 20, 1986.
Appeal from the District Court of the City and County of Denver Honorable Robert T. Kingsley, Judge
Page 1010
DeMoulin, Anderson, Campbell Laugesen, P.C., Laird Campbell, for Plaintiff-Appellee E. B. Jones Construction Company.
Douglas John Traeger, for Plaintiff-Appellee Stewart-Decatur Security Systems, Inc.
Stephen H. Kaplan, City Attorney, Sidney Biderman, Assistant City Attorney, John Eckhardt, Assistant City Attorney, Joel Kohn, Assistant City Attorney, Stan M. Sharoff, Assistant City Attorney, for Defendant-Appellant.
Division II.
Opinion by JUDGE STERNBERG.
[1] Defendant City and County of Denver appeals from a judgment entered in favor of plaintiffs, E.B. Jones Construction Company (Jones) and Stewart-Decatur Security Systems, Inc. (Stewart). We affirm in part, reverse in part, and remand. [2] This action arose out of disputes regarding substantial delays in the construction, between 1974 and 1978, of the Denver Police Administration and Pre-Arraignment Detention Facility. The trial court made extensive, detailed findings of fact, overwhelmingly substantiated by the record, which may be summarized as follows. [3] Construction of the facility, a complex and difficult project, was among Denver’s first efforts to plan, manage, and supervise major construction without the services of a general contractor. Under prior well-established procedures and as provided in the Denver Charter, Denver would select a general contractor after taking competitive bids. The general contractor would be responsible for management of subcontractors bidding on and performing various components of the actual construction, including coordination and scheduling of both preparatory and on-site phases of their work. In order to assure timely, efficient, and proper performance, thus protecting Denver’s interests under the general contract, experienced City and County engineering and public works personnel would be responsible for direct supervision of the general contractor. [4] This project, however, was to be managed as a co-venture pursuant to the terms of a Project Management Agreement made with N.G. Petry Construction Co. and C.M. Associates, Inc., (Petry-CM). By the terms of this agreement Petry-CM was to “establish and implement a comprehensive management program, including all direction, procedures, coordination, administration, review, expediting and counseling required to assist the City and its designated consultants and contractors in completing the Project in a timely, economical and acceptable manner.” This contract was secured without competitive bidding, and compensation for Petry-CM was fixed by negotiation rather than by bid. The trial court found that the Agreement established Petry-CM as professional agent of Denver in all phases of design and construction of the facility. [5] It was contemplated that the project was to be managed under a method known as “phased” or “fast-track” construction. This is a technique whereby plans and specifications are prepared after construction has begun and only as they become necessary in order to proceed with each of the various stages of the construction process, including contract bidding and both the preparatory and on-site work of contractors. As compared with management by a general contractor, its purpose is to shorten the construction process by obviating the need to complete plans for an entire project before opening it for bid. The use of this method demands exacting coordination and scheduling of the various contract components of a project and precise management of on-site conditions if work is to be performed efficiently and without delay.Page 1011
[6] Through Petry-CM, Denver was to control progress pursuant to express conditions inserted at the suggestion of Petry-CM in each of the twenty-two contracts entered into for the project. General Condition C-49 provided for termination by Denver. Special Condition 12 stated that “[a]ll Contractors understand and agree that all work must be performed in an orderly and closely coordinated sequence so that the date for substantial completion may be met . . .” and gave Denver options to enforce timely performance. Each contract further specified a time frame within which performance was to occur. [7] The trial court found that these factors — the agreement with Petry-CM, the management method chosen, and the language of individual contracts as relied upon by contractors in fixing their bids — combined to impose upon Denver the responsibility “to organize, schedule, coordinate, expedite and generally supervise and manage the work of all twenty-two contracts in order that each . . . could perform its work under its contract” in a timely, economical, and acceptable manner and “to select a manager which had the expertise, capability and qualifications to do so.” The court found that this responsibility arose both as a material and mutually contemplated contractual duty and as a duty of reasonable care in the circumstances. [8] Petry-CM, however, had no experience in managing projects such as the construction of the facility. This fact was known to Denver prior to its agreement with Petry-CM. Petry-CM represented to Denver that it would select a construction manager who had the requisite experience but it did not do so. In fact, the construction manager selected by Petry-CM did not have experience with the phased construction management methods used on the project. Denver became aware of these facts also but did nothing to cause Petry-CM to substitute a more qualified manager. [9] Further, the procedures through which City and County offices had supervised and administered construction contracts were bypassed by Denver’s creation of a new office to supervise construction of the facility. This office was under the initial direction of an ex-sportscaster and, later, a man professionally trained as a traffic engineer, neither of whom had the required construction experience. These persons were given control of all scheduling while more highly qualified City and County personnel were relegated to ministerial roles. [10] The trial court specifically found that, prior to awarding the project contracts, Denver and Petry-CM knew or should have known that compliance with the schedules specified therein was impossible. The trial court also found that Petry-CM knew, through prior experience with General Condition 49 and Special Condition 12, that these methods of control actually slowed and hindered construction rather than expediting it. [11] Jones was the successful bidder on the contract for placing building concrete. Time of performance was to be 365 days beginning October 1, 1975. Jones received a notice to proceed beginning January 5, 1976. Because of various delays on the project, it could not begin until February 25. Jones was also to perform “site work,” including such tasks as paving sidewalks and ramps, but when this work was to be begun the areas to be paved were in use for storage of materials used by other contractors. [12] In spite of the fact that installation of the concrete was to be completed before installation of the facility’s security system began, the system was initially planned to be installed between October 10, 1975, and July 1976. Stewart was the successful bidder on this contract. As it turned out, Stewart received a notice to proceed dated April 8, 1975, at which time the project was still clearly not at the stage required for Stewart’s work. Later notice ordered Stewart to begin work September 1, 1976, a full month after its work was to have been completed under its contract. [13] The trial court found that both plaintiffs did everything reasonably possible to expedite efficient performance of their contract obligations and that both would havePage 1012
finished performance as specified in their contracts but for breach of the duties assumed by Denver through gross mismanagement of the project by Denver and Petry-CM. The court found that there was no other cause for the expensive delays suffered by plaintiffs.
[14] Further, in early 1976, when plaintiffs first notified Denver and Petry-CM of increased expenses because of delays, Petry-CM advised them to submit claims with substantiating data after completion and acceptance of their individual work and clearly represented that their claims would be paid. However, in February 1977, Denver determined not to pay such claims. Petry-CM was made aware of this decision soon thereafter. Jones was not notified of this change of position until November 1977, and Stewart was not notified until February 1978, after each had completed work. [15] The trial court found that Denver, by failing to advise plaintiffs of its change of policy, knowingly made false representations to plaintiffs that their claims would be paid with the intention of inducing plaintiffs to continue and finish work. It further found that Denver accepted the facility as a quality structure unjustly and inequitably obtained at plaintiffs’ expense. [16] The trial court concluded that Denver was liable to each plaintiff under theories of breach of contract, estoppel by representation, unjust enrichment, and negligence. Both Jones and Stewart were awarded damages including delay costs and moratory interest, court costs, and, pursuant to post-trial motion and order, attorney fees.[17] I. Basis of Recovery
[18] Denver’s principal argument is that the Denver City Charter Provision A6.15 bars any recovery based in contract. This provision states that:
(Colo.App. 1983) and F.J. Kent Corp. v. Town of Dillon, 648 P.2d 669 (Colo.App. 1982). [21] Because it is undisputed that Denver appropriated no funds to pay the amounts claimed as damages in this case, Denver contends that plaintiffs may not recover. While resisting this argument, the plaintiffs contend that Denver, proceeding through a former city attorney, failed properly to preserve it as a ground of reversal. We agree with plaintiffs.
[22] A. New Trial Motion
[23] The parties do not dispute that, here, this question is controlled by C.R.C.P. 59(f) as it existed before its repeal and reenactment in 1984 Compare C.R.C.P. 59, in C.R.S. Vol. 7A with C.R.C.P. 59 in C.R.S. Vol. 7A 1985 Cum. Supp. This version of the rule states that “only questions presented in [the new trial motion] will be considered by the appellate court on review. . . .” General allegations of error do not comply with the rule; errors relied on as grounds for reversal should be stated with some degree of specificity. See Martin v. Opdyke Agency, Inc., 156 Colo. 316, 398 P.2d 971 (1965); Jones v. Dunlap, 78 Colo. 221, 239 P. 989 (1925).
Page 1013
174 Colo. 171, 483 P.2d 212 (1971); Jones v. Dunlap, supra.
[25] B. C.R.C.P. 60(b) Motion
[26] Denver contends in its briefs, however, that the Provision A6.15 defense was properly preserved for review because the trial court heard arguments concerning and denied a pleading entitled “Defendant’s Supplement to Motion for New Trial and Memorandum Brief and Motion to Set Aside Judgments Under Rule 60(b), C.R.C.P.” The trial court’s findings of fact and conclusions of law were filed on December 18, 1981, and, pursuant to motion for an extension, Denver’s new trial motion was to be filed on or before January 18, 1982. The pleading here at issue was filed on April 8, 1982. We conclude that, insofar as Denver’s argument rests on the “Supplement to Motion for New Trial” portion of this pleading, the issue was not timely raised and the trial court did not err in disallowing the supplement. We need only determine, therefore, the effect of the portions styled “Motion to Set Aside Judgments Under Rule 60(b) C.R.C.P.”
Page 1014
the trial court and, absent abuse of that discretion, will not be disturbed on appeal. See Columbine Valley Construction Co. v. Board of Directors, 626 P.2d 686 (Colo. 1981).
[31] Denver presents no arguments that would support or justify the conclusion that the appearance of a case merely reiterative of a point of law litigated at trial and finally ruled upon by the trial court is an extraordinary circumstance properly within the ambit of any ground for relief provided by C.R.C.P. 60(b). Here, there is a valid and effective judgment for damages which has not been satisfied, released, or discharged. Neither was it based on a prior judgment subsequently reversed or otherwise vacated. Based upon the authorities cited, we conclude that defendant does not present even a colorable claim for relief under C.R.C.P. 60(b)(3), (4), or (5). Hence, the trial court did not err in denying this “motion.” [32] Further, we agree with plaintiffs that the C.R.C.P. 60(b) portion of the April 8 pleading is an attempt to use the rule as a substitute for timely appeal of the trial court’s rulings concerning the application to the facts of this case of Denver City Charter Provision A6.15. Denver’s proper remedy on this issue was to preserve the question by motion for new trial. Having failed so to do, Denver may not now place the issue before this court. [33] We hold, in accordance with well-established authority, that “an appeal from denial of Rule 60(b) relief does not bring up the underlying judgment for review.” Brauder v. Director, 434 U.S. 257, 98 S.Ct. 556, 54 L.Ed.2d 52 (1968), quoted in Morris v. Adams-Millis Corp., 758 F.2d 1352(10th Cir. 1985) (where no notice of appeal was filed, possibly erroneous ruling was not reviewable on review of subsequent order denying Fed.R.Civ.P. 60(b) motion filed after expiration of time for appeal). [34] Based on the foregoing, we hold that Denver has failed to preserve for review any challenges to plaintiffs’ recovery as based in breach of contract.
[35] II. Damages
[36] Stewart was awarded damages including the following elements: Delay costs in the amount of $57,315.08; $14,417.24 as moratory interest on its costs and retainages held by Denver, calculated at 8% from the date of completion specified in its contract until the date of its formal claim to Denver; and moratory interest on the sum of these amounts from the date of claim until the judgment was entered. Denver argues that the trial court erred by awarding the $14,417.24. We disagree.
(Colo.App. 1983) (interest on unliquidated amount owed under performance bond not available as damages where defendant did not benefit from plaintiff’s loss of funds held by third party). Neither position, however, addresses the concept of moratory interest relied upon by the trial court in assessing damages. [38] Conventional interest as a matter of contract and statutory prejudgment interest on particular kinds of damage awards are to be distinguished from moratory interest. Moratory interest is an element of damage in itself which is allowed as compensation for the detention and use of money. See 22 Am. Jur. 2d Damages § 179 (1965). [39] In Davis Cattle Co. v. Great Western Sugar Co., 393 F. Supp. 1165 (D. Colo. 1975), aff’d 544 F.2d 436 (10th Cir. 1976), cert.
Page 1015
denied, 429 U.S. 1094, 97 S.Ct. 1109, 51 L.Ed.2d 541 (1977), the court conducted an exhaustive survey of Colorado law concerning the availability of such damages. It concluded that moratory interest is available as damages under circumstances in which statutory interest would not be awardable on “all monies after they become due, on any bill, bond, promissory note, or other instrument of writing . . . on money due on mutual settlement of accounts . . . [or] due on account . . . and on money received to the use of another and retained without the owners consent . . . and on money taken or retained and fraudulently converted to the taker’s use . . . .” See
§ 5-12-102, C.R.S.
§ 5-12-101, C.R.S. (1985 Cum. Supp.); Banker’s Trust Co. v. International Trust Co., 108 Colo. 15, 113 P.2d 656 (Colo. 1941). We find no abuse of discretion here, and we conclude that the trial court did not err in awarding $14,417.24 as moratory interest damages.
III.
[43] We do, however, agree with Denver’s final contention, that the trial court erred in awarding attorney fees to plaintiffs.
Page 1016
deduct the attorney fee award from the judgment.
[50] JUDGE SMITH and JUDGE BERMAN concur.