Connolly v. Asheville Contracting Co.

Bobbitt, J. Plaintiffs’ action is against Contracting Company for alleged breach of its contract with plaintiffs. They assert no claim against Power Company. They are not parties to and do not participate in this appeal. Power Company, pursuant to Judge Copeland’s unchallenged order, is now a party to this action. Hence, whether Power Company is a necessary or proper party is not presented; and Simon v. Board of Education, 258 N.C. 381, 128 S.E. 2d 785, cited and stressed by Contracting Company, is not pertinent. The sole question for decision is whether the court erred in sustaining Power Company’s demurrer to Contracting Company’s cross action. The gist of plaintiffs’ alleged cause of action (for loss of profits) against Contracting Company, based on their contractual relations inter se, is that, notwithstanding their contract called for 50,000 square feet of paving, Contracting Company breached the contract by its refusal to permit plaintiffs to provide paving in excess of 12,150 square feet. Although the documents constituting the prime contract are made a part of the subcontract, whether any provisions of such documents bear significantly upon plaintiffs’ right to recover from Contracting Company is not presented by this appeal. The rights and obligations of Contracting Company and of Power Company inter se are to be determined by the provisions of the prime contract. Paragraph 10 thereof is quoted in our preliminary statement. Contracting Company asserts the validity of Paragraph 10 in both its answer and cross action and relies thereon as a defense to plaintiffs’ action. Whether it has significance in connection with Contracting Company’s defense to plaintiffs’ action is not presented by this appeal. Unquestionably it has significance in the determination of the rights and obligations of Contracting Company and of Power Company inter se. Reference is made to the excerpt from Paragraph K of the cross action quoted in our preliminary statement. This is the only portion of the cross action in which Contracting Company purports to allege a (conditional) cause of action against Power Company. The subcontract relates solely to the installation of (approxi [427] mately) 50,000 square feet of paving, this being only one of many items covered by the prime contract. Paragraph 10 of the prime contract relates to all items covered thereby. Plaintiffs base their cause of action on the provisions of the subcontract. Their allegations imply a contention that Paragraph 10 of the prime contract is inapplicable to them or in any event is not a bar to their action against Contracting Company. Whether, as between Contracting Company and Power Company, the reduction in the quantity of paving was such an alteration as to constitute a material change in the original plans within the meaning of said Paragraph 10 must be determined with reference to the prime contract in its entirety, not with reference to the one item relating to paving. The documents comprising the prime contract call for numerous items at unit prices, the original estimated total amounting to $958,528.23. Item 6 called for “Installation of paved slope drains & intercept ditches (Quantity) 10,000 Lin ft (Unit Price) 4.00 (Amount) 40,000.00,” which, prior to the execution of the subcontract, was modified by substituting as Item 6 the following: “50,000 S. F. Paved Slope Drains @ 0.75 per square foot.” What would constitute an alteration materially changing the original plans when considered in relation to all work called for by the prime contract and what would constitute such material alteration if considered only in relation to “Item 6” are different questions. Contracting Company does not allege in its cross action, conditionally or otherwise, that the reduction in the quantity of paving was such an alteration as to constitute a material change in the original plans of the prime contract within the meaning of Paragraph 10 thereof. Indeed, Contracting Company’s reliance upon Paragraph 10 of the prime contract as a defense to plaintiffs’ action indicates strongly that Contracting Company agreed or acquiesced in the decision of Power Company’s engineer with reference to the quantity of concrete to be poured. Moreover, nothing in Contracting Company’s allegations dispels the possibility that a full and complete settlement has been made between Power Company and Contracting Company. Whether Power Company is obligated to Contracting Company does not depend solely upon the provisions of the prime contract but in material part upon their course of dealings during the progress of the work and in relation to settlement therefor. Contracting Company’s purported cross action alleges no facts pertinent to these material matters. Obviously, a recovery by plaintiff from Contracting Company, standing alone, would not entitle Contracting Company to recover a like amount or any amount from Power Company. In short, Contracting Company’s cross action does not allege facts sufficient to state a cause [428] of action, conditionally or otherwise, against Power Company. Hence, Power Company’s demurrer to said cross action was properly sustained. Having reached the conclusion that Contracting Company’s purported cross action fails to state a cause of action against Power Company, whether there would be a misjoinder of parties and causes of action if a cause of action had been alleged need not be considered. Batts v. Faggart, 260 N.C. 641, 644, 133 S.E. 2d 504, 506, and cases cited. Affirmed.