Opinion
No. COA10-869
Filed 21 June 2011 This case not for publication
Appeal by plaintiff from order entered 18 May 2010 by Judge L. Todd Burke in Guilford County Superior Court. Heard in the Court of Appeals 26 January 2011.
Higgins Benjamin Eagles Adams, PLLC, by Robert G. McIver, for plaintiff. Conner Gwyn Schenck, PLLC, by Jay M. Wilkerson and A. Holt Gwyn, for defendant.
Guilford County No. 09 CVS 10498.
Lomax Construction, Inc. (plaintiff), appeals from an order of summary judgment in favor of Triad Sheet Metal Mechanical, Inc. (defendant). After careful consideration, we affirm the order of the trial court.
On 14 May 2009, plaintiff submitted a bid to be the prime contractor for a fire station project owned by Piedmont Triad International Airport Authority (Airport Authority). Plaintiff solicited and received bids from several subcontractors, including defendant, who submitted a "proposal for Labor and Materials" to complete the mechanical work on the project. Plaintiff incorporated defendant's bid into its proposal to the Airport Authority, identifying defendant on its proposal as required. Plaintiff was the lowest responsible bidder for the project, and it won the prime contract.
On 4 May 2009, after plaintiff solicited the mechanical work bid from defendant but before defendant submitted its bid, the Airport Authority revised the project specifications to add Section 15870 to the contract documents. Section 15870 added plans for a vehicle exhaust system. Defendant did not include the cost of installing the vehicle exhaust system when it put together its proposal to complete the mechanical work for $195,518.00. The proposal defined the scope of work as "Install heating and cooling, exhaust fans, heaters per plans and specs. Alternates received. Price includes gas piping, controls by Trane." Defendant apparently realized its omission shortly after submitting its proposal on 14 May 2009, and George Hendrix, one of defendant's employees, left a voicemail for Maria Harvell, plaintiff's estimating coordinator, telling her that the vehicle exhaust system was not a part of defendant's bid. If Harvell heard the voicemail, she did not tell the president of Lomax Construction, John Lomax, about it until weeks later, after he had already learned from Hendrix that defendant's bid had not included the vehicle exhaust system.
On 15 May 2009, after plaintiff learned that it had won the prime contract, the Airport Authority contacted John Lomax, to discuss "minority participation" goals on the project. The Airport Authority wanted a certain amount of the project to go to Minority Business Enterprises (MBEs), so plaintiff turned to defendant to see if it could purchase supplies from an MBE supplier. On 15 May 2009, defendant submitted a subcontract bid from such a subcontractor.
Approximately two weeks later, Hendrix and Lomax were "discussing some things about the project," and Lomax learned that defendant's bid had not included the vehicle exhaust system. Plaintiff was in the process of drafting the subcontract when this occurred. Plaintiff insisted that defendant purchase and install the vehicle exhaust system without an increase in the bid amount. Defendant's president, Dwayne Bingman, informed defendant by email on 3 June 2009 that defendant would "stand by" its quote. Bingman explained that the scope of work as written on the bid did not include the vehicle exhaust system. According to Bingman, the company that produced the vehicle exhaust system "only works directly with the [general contractor,]" and the quote for a system was $74,845.00. Bingman noted, "We put a VERY competitive number on this quote and can't afford any additional costs[;] therefore please feel free to move forward as you feel you need to." He concluded, "Hopefully this is something that can be worked out. I think maybe it was an oversight by [plaintiff]."
At 5:36 p.m. on 8 June 2009, John Lomax replied that the two parties "already ha[d] a contract," and plaintiff expected defendant to "do this project" for its "originally quoted price." Lomax explained:
You made a[n] offer to us on bid day and we accepted your offer we relied on your price in our price to the Owner . . . Your quotation excluded 2 things: 1. low Voltage power wiring. . . . (a fairly standard exception) and 2. Air Compressor (which the Mechanical plan states is "by the Owner").
The ellipses and multiple periods are original to the text and do not indicate editorial omissions by the Court.
You did not exclude the Mechanical Ventilation system . . . which is clearly shown on your plans and in your section of the specs. . . . You claim the other mechanical contractors do not include or exclude this is false also. . . . our next bidder has the exhaust system . . . and we will submit proof of this.
You claim to have left a voice mail revising your quotation . . but you do not remember who you left the voice mail with? [R]egardless, by law, the only way to revise a written quotation is with a written revision . . . You did not do that . . .
The next morning, at 11:06 a.m., Lomax emailed Bingman to inform him that plaintiff would "proceed to contract with another subcontractor" and that plaintiff would "file suit" against defendant "for the funds we expend due to [defendant's] breach of contract."
That same day, Bingman sent a letter to Lomax withdrawing defendant's bid. Bingman reiterated his belief that defendant had not entered into a contract with plaintiff, elaborating as follows:
The plans reference Spec # 15870 which does not even exist. As I have stated to you, we did not include this in our scope of work as the other Mechanical Contractors didn't. I realize that you say we were $20000.00 less than the next bid but I have a copy of that Mechanical Contractors quote that was sent out on May 14, 2009 and he as well does not show these items included NOR excluded. The quotes that have it included specifically list it out and are $99000 to $123000 higher when included.
Plaintiff indeed sued defendant for breach of contract on 10 August 2009. Defendant answered and moved for summary judgment. Following a hearing, the trial court granted defendant's motion for summary judgment, dismissing plaintiff's claims. Plaintiff now appeals.
On appeal, plaintiff argues that the trial court erred by granting defendant's motion for summary judgment because a genuine issue of material fact exists as to whether the parties formed an enforceable contract.
The party moving for summary judgment is entitled to judgment as a matter of law only when there is no genuine issue of material fact. The party moving for summary judgment bears the burden of bringing forth a forecast of evidence which tends to establish that there is no triable issue of material fact. To overcome a motion for summary judgment, the nonmoving party must then produce a forecast of evidence demonstrating that the [nonmoving party] will be able to make out at least a prima facie case at trial.
Before summary judgment may be entered, it must be clearly established by the record before the trial court that there is a lack of any triable issue of fact. In making this determination, the evidence forecast by the party against whom summary judgment is contemplated is to be indulgently regarded, while that of the party to benefit from summary judgment must be carefully scrutinized. Further, any doubt as to the existence of an issue of triable fact must be resolved in favor of the party against whom summary judgment is contemplated.
Creech v. Melnik, 347 N.C. 520, 526, 495 S.E.2d 907, 911 (1998) (quotations and citations omitted). We review an order of summary judgment de novo. Forbis v. Neal, 361 N.C. 519, 524, 649 S.E.2d 382, 385 (2007).
"The elements of a claim for breach of contract are (1) existence of a valid contract and (2) breach of the terms of [the] contract." Poor v. Hill, 138 N.C. App. 19, 26, 530 S.E.2d 838, 843 (2000). Here, the parties dispute the existence of a valid contract. The parties agree that they never entered into an express, written subcontract for the mechanical work, but "[t]he parties' failure to reach agreement on the written subcontract does not preclude the conclusion that an express contract existed." Industrial Textile Piping, Inc. v. Industrial Rigging Services, Inc., 69 N.C. App. 511, 514, 317 S.E.2d 47, 49 (1984) (citation omitted). Plaintiff argues that the parties formed an implied contract "based upon the totality of their actions surrounding the [project] and the bidding of the vehicle exhaust system."
An implied-in-fact contract exists by virtue of the parties' conduct, rather than in any explicit set of words. However, although its terms may not be expressed in words, or at least not fully in words, the legal effect of an implied in fact contract is the same as that of an express contract in that it too is considered a "real" contract or genuine agreement between the parties.
Kiousis v. Kiousis, 130 N.C. App. 569, 573, 503 S.E.2d 437, 440 (1998) (citations omitted).
In Industrial Textile Piping, on which plaintiff's argument relies, this Court affirmed a trial court's conclusion that a general contractor and a subcontractor had entered into a verbal contract "based on findings to the effect that communications and conduct between the parties manifested a mutual assent." 69 N.C. App. at 513, 317 S.E.2d at 48-49. The general contractor accepted the subcontractor's bid and "ordered" the subcontractor to "`man' the job." Id. at 513, 317 S.E.2d at 49. The parties also "agreed to the specific tasks [the subcontractor] was to complete, to a time schedule for performance, and to payment terms." Id. The general contractor "sent a letter of intent to [the subcontractor] to `solidify [their] mutual understanding' and agree on an adjusted price to be paid to" the subcontractor. Id. The subcontractor began work, and the general contractor made the first payments to the subcontractor. Id. However, when the general contractor presented the subcontractor with the subcontract, the subcontractor refused to sign it, averring that the subcontract "contained new terms to which defendant had not agreed and would not agree." Id. We held, despite the lack of a written subcontract, that the trial court had sufficient evidence from which to "conclude that an informal contract existed[.]" Id. In support of this conclusion, we recited the following language from Corbin on Contracts:
Often a subcontractor submits a bid, in accordance with prepared plans and specifications, for the prime contractor's use in obtaining the principal contract; the latter's acceptance of the bid may consummate the subcontract even though it is not reduced to a formal instrument as was contemplated; the terms may be sufficiently definite and complete.
Id. at 513-14, 317 S.E.2d at 49 (quoting 1 A. Corbin, Contracts § 30, at 100-03 (1963)) (emphases added). The operative word in that passage is "may" — a general contractor's acceptance of a subcontractor's bid may consummate the subcontract if the terms are sufficiently definite and complete. In this State, acceptance of a subcontractor's bid alone is "not viewed as sufficient consideration to support an implied contract between the contractor and the subcontractor." Clark Trucking of Hope Mills, Inc. v. Lee Paving Co., 109 N.C. App. 71, 74, 426 S.E.2d 288, 289 (1993).
The question, then, is whether plaintiff forecast enough evidence of communications and conduct between the parties to show that they formed an implied contract. We hold that it did not. Here, defendant never performed. Plaintiff never ordered defendant to perform. Plaintiff never paid defendant. The parties never agreed to a time schedule or payment terms. Even if we consider defendant's bid proposal to be an offer, plaintiff's acceptance must be "unequivocal and unqualified." Henderson Corbin, Inc. v. West Carteret Water Corp., 107 N.C. App. 740, 744 421 S.E.2d 792, 794 (1992) (citation omitted). Plaintiff never actually contacted defendant to accept the bid proposal, which precludes an unequivocal acceptance. In addition, plaintiff's post-bid request that defendant use an MBE supplier precludes an unqualified acceptance.
Accordingly, we affirm the trial court's order of summary judgment.
Affirmed.
Judges STEELMAN and ERVIN concur.
Report per Rule 30(e).