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Jackman Construction, Inc. v. Rock Springs Winnelson Co. Inc.

Supreme Court of Wyoming

December 13, 2016

JACKMAN CONSTRUCTION, INC., a Wyoming Corporation, Appellant (Defendant),
v.
ROCK SPRINGS WINNELSON CO., INC., Appellee (Plaintiff).

         Appeal from the District Court of Sweetwater County The Honorable Nena James, Judge

          Representing Appellant: Clark Stith, Rock Springs, Wyoming.

          Representing Appellee: Danielle M. Mathey of Mathey Law Office, P.C., Green River, Wyoming.

          Before BURKE, C.J., and HILL, DAVIS, FOX, and KAUTZ, JJ.

          KAUTZ, Justice.

         [¶1] Appellee Rock Springs Winnelson Co. (Winnelson) sued Appellant Jackman Construction, Inc. (Jackman) for nonpayment of materials supplied for the Southside Improvements Project in Green River, Wyoming (project). Jackman counterclaimed on various legal theories, including promissory estoppel, to recover the amount it paid in excess of Winnelson's subcontractor bid. After a bench trial, the district court generally found in favor of Winnelson and denied Jackman's counterclaims.

         [¶2] Jackman asserts the district court erred by rejecting its promissory estoppel claim. The record contains ample evidence to support the district court's factual determinations and it did not commit any prejudicial errors of law. We, therefore, affirm.

         ISSUES

         [¶3] Jackman presents the following issues for our review:

1. Did the district court err by not conducting any analysis of promissory estoppel?
2. Did the district court err by refusing to accept the stipulation of the parties that [Jackman] paid Winnelson $679, 941.52 toward the [project]?
3. Was the district court's finding that Jackman later agreed to pay higher prices than those that appeared on Winnelson's bid clearly erroneous?

         Winnelson counters with these issues, which we have restated:

         1. Is Jackman barred from arguing that Winnelson's freight charges were fraudulent because the argument was not made below and/or the fraud claim was not pled with particularity?

         2. Is Jackman barred from arguing the bid expiration date was unreasonable because the argument was not made below?

         3. Did the district court err by deciding that Jackman had failed to prove the elements of promissory estoppel?

         4. Was any error in refusing to recognize the parties' stipulation harmless?

          5. Are W.R.A.P. 10.05 sanctions appropriate?

         FACTS

         [¶4] On May 4, 2010, Jackman was the successful bidder on a project to install new water lines and a pump station for the City of Green River. Prior to the general contract bid letting, Winnelson submitted a bid to supply plumbing materials for the job (Bid #1) to several general contractors, including Jackman. There were several bid schedules covering materials for different aspects of the project. Winnelson's bid of $550, 247.81 was for most of the materials, but it did not include materials for three of the bid schedules. Winnelson's fax cover sheet which accompanied Bid #1 notified the general contractors that "All FBE fittings special order contractor to verify [quantities] & items as most fittings are 4-6 weeks delivery. Nonreturnable after order, any questions please call." Winnelson's bid also had a thirty day expiration date which, depending on the particular bid schedule, was either May 16 or May 19, 2010.

         [¶5] A couple of days before the bid letting, Jackman's project manager, Heather Glenn, requested that Winnelson prepare a separate quote just for the pipe to be used on the project. That same pipe had been included in Winnelson's Bid #1. Winnelson provided the pipe bid which was $254, 821.70 (Bid #2). That bid was conditioned for "immediate acceptance" and the prices were applicable "only if all items listed [were] ordered."

         [¶6] Jackman never executed a written contract with Winnelson to supply the materials or specifically notified Winnelson that it was accepting Bid #1 or Bid #2. Jackman owner, Lynn Jackman, testified that he accepted the bid for all of the project materials on the day after the bid letting by telling Pete Frullo, the president of Winnelson, to "get [his] submittals in order." A submittal is a document in which the supplier provides information about the specific materials it intends to provide to meet the project specifications. For this project, submittals had to be approved by the project engineer prior to the general contractor ordering the materials. Mr. Jackman did not indicate whether Winnelson should get "submittals in order" for Bid #1 or Bid #2.

         [¶7] Despite Mr. Jackman's statement, the submittal process was not followed in an orderly fashion. Mr. Jackman ordered the pipe (corresponding to Bid #2) on May 14, 2010, without first having a submittal approved by the project engineer. Mr. Jackman did not comply with the condition in Bid #1 requiring it to verify the items and quantities of fittings and parts. Without that information, Winnelson could not prepare submittals or order the other materials. Instead, Ms. Glenn, on behalf of Jackman, ordered materials piecemeal during the course of the project, long after Bid #1 had already expired, without ever providing Winnelson a complete set of approved submittals.

         [¶8] Winnelson honored its bid prices for the pipe, but on the other items it charged Jackman the price in effect at the time of the order. Winnelson also added freight charges to its invoices, often including charges for expedited delivery when Jackman needed the items quickly. The freight charges were not always listed separately on the invoices, and Mr. Frullo explained that Ms. Glenn agreed to pay additional freight but asked that it be incorporated into the price of the materials.

         [¶9] Toward the end of the job, Jackman had trouble paying Winnelson's invoices. Some large checks were returned for insufficient funds, and Winnelson began to require payment before it would provide materials to Jackman. Eventually, Jackman stopped paying altogether, and Winnelson refused to provide any more materials. Jackman obtained the rest of the materials it needed for the job from another supplier.

         [¶10] Winnelson filed suit in circuit court against Jackman[1] for its failure to pay invoices totaling $21, 705.31, which included principal and service charges. Jackman counterclaimed for breach of contract, promissory estoppel and negligent misrepresentation[2] and, in its amended counterclaim, requested damages of more than $50, 000. Jackman asserted that Bid #1 was enforceable based on promissory estoppel, and that Winnelson breached the terms of Bid #1 by charging more for parts than the bid prices. Because the amount claimed by Jackman exceeded the circuit court's jurisdiction, the matter was transferred to district court.

         [¶11] The district court conducted a one-day bench trial and issued findings of fact and conclusions of law under W.R.C.P. 52, granting judgment in favor of Winnelson on the outstanding principal. The district court denied Winnelson's claim for unpaid service charges because the language on Winnelson's invoice form indicated the charge was discretionary and did not specify the amount to be charged or the method of calculating it.

         [¶12] The district court denied Jackman's counterclaims. It ruled that, to be enforceable under the statute of frauds, a contract for the project materials had to be in writing because it involved a sale of goods for a price of $500 or more. See Wyo. Stat. Ann. § 34.1-2-201 (LexisNexis 2015). Given Jackman did not accept Bid #1 in writing prior to the expiration dates, the court concluded no valid contract based upon the bid was formed. Instead, the district court found that the parties contracted under Bid #2 when Jackman ordered the pipe and entered into a series of smaller contracts when other materials were ordered by Ms. Glenn. The district court also rejected Jackman's alternative claims based upon promissory estoppel, unjust enrichment and negligent or intentional misrepresentation. Jackman filed a timely notice of appeal.

         STANDARD OF REVIEW

         [¶13] When the district court conducts a bench trial and issues findings of fact and conclusion of law pursuant to Rule 52, we review its factual findings for clear error and its conclusions of law de novo. Wime ...


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