Date:
July 26,2005
Re:
Report and Recommendation
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I am
leased to submit for your consideration and approval the attach+.
and recommendation.
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A.F. Amorello & Sons, Inc. (Amorello), general contractor
under MHD contract #32067 (Contract) for roadway
reconstruction and related work on Grove Street in Paxton,
appeals from the refusal of the Engineer to grant extra work of
$14,018.40 for the removal of Class B Rock during earth
excavation. Amorello claims removal of Class B Rock was
extra work because the Contract purportedly containpd no
specific pay item for such work. The Department conltends
that excavation of Class B Rock is paid for under a splecial
provision of the Contract.
Amorello's appeal is without merit. The special provision for
"earth excavation" stated that it was for "work [that]
include[s] the excavation of material of every description,
regardless of the type encountered, from within the limits of
the Contract
The Contract provides that special
provisions govern over conflicting standard specifications.
Accordingly, the special provision prevails over Sections 120
and 140 that might otherwise be relevant.
...."
The special provision of the Contract should be enforced in
accordance with its plain meaning.
Amorello's appeal should be denied.
Massad,usetis&J~V?YDepartment. Ten Park Pkm, Boston, U4 021 16-3973 (617)973-7800
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INTRODUCTION
A.F. Amorello & Sons, Inc. (Amorello), the general contractor on Department
contract #32067 (Contract) for roadway reconstruction and related work on Grove Street
in Paxton, appeals from the refusal of the Engineer to grant extra work worth $14,018.40
for the removal of Class B Rock during earth excavation. Amorello claims removal of
Class B Rock to be an extra because the Contract purportedly contained no specific pay
item for that work. The Department contends that the excavation and removal of Class B
rock is to be paid under a special provision of the Contract, Item 120 (“Earth
Excavation”). The Department argues that special provision controls the outcome here
since it includes excavation of “materials of every description.”
Amorello’s appeal is without merit. The special provision, Item 120, is for “work
[that] include[s] the excavation of material of every description, regardless of the type
encountered, from within the limits of the Contract….” When Amorello bid a $14/CM
unit price for Item 120, it knew or should have known that, with certain exceptions not
applicable here, Item 120 excavation work included Class B Rock.
I recommend that the Secretary deny Amorello’s appeal.
BACKGROUND
Amorello bid $1,953,009.90 for the road reconstruction work, a federal aid
project. The Contract work was to correct and improve drainage, reconstruct travel
surfaces, drainage structures, add paved shoulders and a concrete sidewalk on the east
side of Grove Street in Paxton for a distance of 1.6 miles. On September 19, 2001 the
Department awarded the Contract to Amorello. The Contract was executed on
September 28, 2001. The Contract is governed by the Standard Specifications for
Highways and Bridges (1995 Metric Edition).
While removing and reinstalling drainage equipment within the Contract limits in
June, 2002 Amorello encountered CL B Rock, which may be generally described as rock
that must be blasted or jack-hammered to pieces before removal.1 The resident engineer
and the District 3 Highway Director agreed with Amorello that the removal and disposal
of CL B Rock was extra work. District 3 asked Amorello to quote a price for its removal.
On June 18, 2002 Amorello quoted a price of $99/CM to the Department and thereupon
crushed and disposed of 141.6 CM of CL B Rock.
On August 30, 2002 the Deputy Chief Engineer for Construction, Mr. McGrath,
reviewed and denied the District 3 Highway Director’s request for extra work. Mr.
McGrath found that special provision Item 120 (“Earth Excavation”) included the
removal of CL B Rock. He therefore refused to submit District 3’s extra work request to
the Board of Highway Commissioners (Board). Amorello thereafter perfected its rights
to file a claim and this appeal. See infra p. 4.
At the time Amorello filed this appeal, Mr. Milano was the Department’s
Administrative Law Judge. On March 1, 2004 the undersigned was appointed
Administrative Law Judge. On July 21, 2004, through St. 2004, c. 196, s. 5 (Act), the
Legislature abolished the Board and, so far as is pertinent here, conferred its prior
functions on the Secretary of Transportation and the Commissioner of the Department
(Commissioner). See G.L. c.16, s. 1(b), as appearing in the Act. This report and
recommendation is made to the Secretary through the Commissioner.
1
See infra p. 6, n. 5.
2
I held a pre-hearing conference in this appeal on February 15, 2005 and heard
Amorello’s appeal on March 31, 2005. Present at the hearing were
Robert Spence
Stephen H. Clark
Isaac Machado
Christian Gonsalves
Andrew Nunes
Engineer, A.F. Amorello & Sons
Administrative Law Judge
Deputy Chief Counsel, MHD
Assistant Counsel, MHD
Area Engineer, MHD, District 3
The following documents were entered as exhibits at the hearing:
Exhibit #1
Exhibit #2
Exhibit #3
Exhibit #4
Exhibit #5
Contract #32067
Statement of Claim
Special Provision Item 120
Submission of March 31, 20052
Post Hearing Submission3
At the conclusion of the hearing I took the matter under advisement.
FINDINGS
The testimony and exhibits, and the record as a whole, contain substantial
evidence to support the findings of fact set forth above and following.
At the time the CL B Rock was encountered, Amorello was performing trenching
work for the installation of drainage and water pipe. The District 3 engineer ordered
141.6 CM of CL B Rock removed. The record does not state at which stations the CL B
Rock was encountered but it is undisputed that the work was done within the limits of the
Contract.
2
Amorello’s submission of March 31, 2005, which I had requested at the pre-hearing conference,
consisted of a statement detailing the administrative procedure Amorello followed to perfect its claim,
copies of special provision Item 120, Sections 120 and 140 of the Standard Specifications (1995 ed.) and a
written statement of Amorello’s contentions.
3
After the hearing the parties stipulated that I could enter the following documents as Exhibit #5 on my
own initiative: June 18, 2002 price quote of Amorello for CL B Rock; August 2, 2002 proposed extra work
order of District 3; Extra Work Order (unexecuted) dated August 5, 2002; July 9, 2002 EWO cover sheet;
August 30, 2002 memorandum of Michael A. McGrath; May 9, 2003 letter of Amorello to District
Highway Director; May 29, 2003 letter of District Highway Director to Amorello; June 4, 2003 claim of
Amorello for extra work.
3
On August 5, 2002 the District 3 Highway Director formally recommended that
the Board approve extra work at the $99/CM price Amorello quoted because it was
“necessary to establish a pay item for Class B Rock Excavation.” Ex. #5.
On August 30, 2002, Michael A. McGrath, Deputy Chief Engineer, Construction,
refused in writing to approve the District 3 Highway Director’s recommendation to the
Board. Mr. McGrath stated that the CL B Rock excavation should be paid under special
provision Item 120 (“Earth Excavation”). Mr. McGrath’s memorandum stated in
relevant part:
This request cannot be forwarded to the Board of Commissioners because
of the second paragraph of the Earth Excavation Special Provision of the
Contract. This provision incorporates “excavation of material of every
description, regardless of the type encountered…” as part of the Earth
Excavation Item. This extra work order is being returned [unapproved] to
the District ….
Amorello was notified of Mr. McGrath’s August 30, 2002 decision by letter dated
May 27, 2003. As soon as Amorello learned that the Department denied its 2002 claim
for extra work, it forthwith filed a formal claim under Subsection 7.16 (“Claims of
Contractor for Compensation”).4 Upon the District’s formal denial of that claim in June
2003, Amorello appealed to the Claims Committee. When the Claims Committee denied
its claim, Amorello filed a notice appeal in this office. In these circumstances Amorello
timely perfected its rights under the Contract to claim extra work.
DISCUSSION
The question for decision is whether the special provision, Item 120 (“Earth
Excavation”) (“Item 120” or “Special Provision”), includes within its ambit the work of
4
The record does not disclose when Amorello first learned of Mr. McGrath’s August 30, 2002 rejection.
However, on May 9, 2003 Amorello requested a response to its June 18, 2002 claim for approved extra
work. It was in response to that inquiry that Amorello was first notified in writing that its 2002 claim for
extra work had been denied. See Ex. #5.
4
excavating and removing 141.6 CM of Class B Rock, or whether such excavation should
be paid as extra work.
Applicable Legal Principles
A contract is to be construed according to its plain and ordinary meaning. See
Thomas v. Hartford Accident & Indemnity Co., 398 Mass. 782, 784 (1986). It must be
interpreted as a transaction entered into by practical people to accomplish an honest and
straightforward end in accordance with common sense and the likely intent of the parties.
See Fleet Nat. Bank v. H&D Entertainment, 96 F.3d 532, 537-38 (1st Cir. 1996).
A contract must be “interpreted as a whole, and effect must be given to all of its
provisions in order to effectuate its overall purpose.” BayBank Middlesex v. 1200
Beacon Properties, Inc., 760 F. Supp. 957, 963 (D. Mass. 1991). Where the wording of a
Contract is found to be unambiguous, the contract must be enforced according to its
terms. Id.; Den Norske Bank AS v. First National Bank of Boston, 75 F.3d 49, 52 (1st
Cir. 1996).
Here, neither party contends that the words of the Contract are ambiguous.
Rather, each party contends that the words of the Contract have a different meaning. In
such circumstances it is appropriate that a judge construe the meaning of the Contract by
applying established legal principles. See Freelander v. G&K Realty Corp., 357 Mass.
512, 516 (1970).
Positions Of The Parties
(a)
Amorello
Amorello claims payment for excavation and disposal of 141.6 CM of Class B
Rock at its proposed price of $99/CM because the Contract contained no express pay
5
item for the removal of CL B Rock.5 It contends that CL B Rock excavation must be
paid for under the Section 140 of Standard Specifications, specifically under Subsection
140.25 (“Class B Rock Excavation”).
Amorello argues that Section 140 work, including removal of CL B Rock, “has no
relationship with Section 120 [work]” and thus no relationship to Special Provision Item
120. Amorello recognizes that the language of the Special Provision (“Earth
Excavation”) is broadly worded, but argues that all work to be done under Item 120 must
nonetheless fall within work generally defined under Section 120 of the Standard
Specifications. The excavation of CL B Rock is not Section 120 work but is work
described in Section 140 of the Standard Specifications, specifically Subsection 140.25,
pay Item 144 (“Class B Rock Excavation”). Thus, according to Amorello, CL B Rock
excavation work cannot be included within Item 120. Moreover, the absence of any pay
item under Section 140 for removal of CL B Rock in the Contract means that such work
was beyond the work specified there and is thus an extra.6 Ex. 4. p. 2.
Amorello supports it contentions by pointing to the Contract’s “Preliminary
Estimate Of Quantities”7 with respect to Item 120, none of which included CL B Rock.
The “Preliminary Estimate” gave quantities for four components, A through D, namely:
“for full depth pavement construction areas” [A], “for bituminous and cement concrete
driveways” [B], “for bituminous concrete sidewalk areas” [C], and “for cement concrete
5
CL B Rock is defined, in part, in Subsection 140.25 of the Standard Specifications (1995 ed.) as
“”[b]oulders measuring 1 cubic yard or more and all solid rock that requires blasting or breaking by hand
power tools [ ] prior to removal.”
6
Amorello asserts that Item 144 (“Class B Rock Excavation”) was simply “inadvertently omitted” from
the Contract.
7
See Contract at p. A00803-3.
6
wheelchair ramps” [D]. Because CL B rock is nowhere referenced, Amorello argues it
must be outside the scope of Item 120 work.
Amorello lastly contends that the quantity estimates for Item 141 (“Class A
Trench Excavation”), which reference “the removal of existing drainage lines and
associated headwalls, etc.” at named stations, do not include CL B Rock excavation,
which means that such work was omitted from Section 140. Amorello thus concludes
that the work of CL B Rock excavation must be deemed extra work. See Section 1.20
(“Extra Work”).8
(b)
Department
The Department contends that the work of excavating CL B Rock is contained
within the express language of the Special Provision.
Accordingly to the Department, the language of the Special Provision means what
it says when it states that Item 120 covers excavation of “material of every description,
regardless of the type encountered.” Thus, it says, the Deputy Chief Engineer McGrath
correctly interpreted the language of the Special Provision to “incorporate” the work of
CL B Rock excavation.
Analysis
The Contract expressly provides at Subsection 5.04 (“Coordination of Special
Provisions, Plans, Supplemental Specifications and Standard Specifications”) that
8
Subsection 1.10 of the Contract defines “extra work” as work that
1. was not originally anticipated and/or contained in the contract: and therefore
2. is determined by the Engineer to be necessary for the proper completion of
the project: and
3. bears a reasonable subsidiary relation to the full execution of the work
originally described in the contract.
7
“Special Provisions shall govern over Supplemental Specifications, plans and Standard
Specifications.” The Special Provision at issue here is Item 120.
Item 120 (“Earth Excavation”) provides
The work under this item shall conform to the relevant provisions of
section 120 of the Standard Specifications and the following:
The work shall include the excavation of material of every description,
regardless of the type encountered, from within the limits of the Contract
in accordance with the plans and specifications or established by the
Engineer, except those materials for which payment is made under some
other item of this contract and except those materials for which excavation
is included with the work specified to be performed under other items of
this Contract.
[Paragraphs three and four omitted.]
The first phrase in the sentence comprising the first paragraph of Item 120 makes
plain that the work “shall conform” with the “relevant” work specified in Subsection 120
of the Standard Specifications. The second phrase of that sentence adds additional work
to be included in Item 120 through the words “and the following:…” (Emphasis added).
As a whole the sentence intends that both “relevant” Subsection 120 work and
work described in the “following” paragraphs are included within Item 120. The
common sense meaning of paragraph one is that certain specified work, not conforming
to Section 120 work, is described in the “following” three paragraphs of Item 120 and
expressly included within its scope.
The second paragraph of Item 120 specifies particular work beyond the scope of
Section 120 work that is nonetheless included in Item 120. Specifically, the “following”
emphasized language in the second paragraph states that earth excavation shall
encompass “the excavation of material of every description, regardless of the type
8
encountered, from within the limits of the Contract in accordance with the plans and
specifications,” with two exceptions.9
I think the Contract language imparts the meaning that “earth excavation” under
Item 120 is intended to cover any “material” that might be encountered within the
Contract “limits.” The plain text of the Special Provision certainly leads to that
conclusion. As well, the broadly worded text in the third and fourth paragraphs provides
support. The third paragraph makes plain that Item 120 applies to the removal of “any”
temporary pavements placed for protection of traffic; while the fourth paragraph specifies
that “disposal of existing materials” deemed “not suitable for reuse” in the work, and
“all” associated costs, are included in Item 120. The comprehensively broad language
throughout Item 120 demonstrates it is a “catch-all” provision, intended to supplant all
Contract provisions to the contrary. See Subsection 5.04. Language of such broad
character is enforceable in accordance with its terms.
The principal flaw in Amorello’s argument is that Item 120 does not only include
work within its terms that would otherwise be described in Section 120 of the Standard
Specifications. The Department was free to specify whatever excavation work it pleased
in Item 120. The Contract provided no prohibition against expanding the scope of work
to include “materials” not usually found in Section 120 excavation work.
It is the text of Item 120, not the fact that it was labeled “120,” that controls.
Amorello points to no authority to substantiate its theory a special provision can only
9
No party claims that the named exceptions control the result here. The work excepted from the
operation of the text of the second paragraph of the Special Provision is (a) excavation of “materials for
which payment is made under some other item of this Contract” and (b) excavation of “those materials for
which excavation is included with the work specified to be performed under other items of this Contract.”
(Emphasis added.) CL B Rock excavation is not included under any other pay item in the Contract. Nor is
that work included “with” work under “other items.” To the contrary, CL B Rock Excavation is expressly
excluded from Item 142 (“Class B Trench Excavation”), for which Amorello bid $4.00/CM. See
subsection 140.23 (“Class B Trench Excavation”) (CL B Rock excavation expressly excluded).
9
“cover” work otherwise called out in a cognate section of the Standard Specifications. It
points to nothing that requires that special provisions be so circumscribed. The Contract
on its face specifies without qualification that special provisions control standard
specifications. See Subsection 5.04 (“Coordination of Special Provisions, Plans,
Supplemental Specifications and Standard Specifications”).
Amorello was put on notice by the broad language of the Item 120 that the unit
price it bid was to excavate, remove and dispose of any “material” needing excavation
“within the limits of the Contract.” Amorello was bound to “examine carefully the site of
the proposed work … [and] special provisions … before submitting a Proposal.”
Contract at Section 2.03 at p. 00200-2; See Standard Specifications, Subsection 2.03
(“Examination of Plans, Specifications, Special Provisions, and Site of Work”).
Amorello knew when it bid that the Contract “omitted” a pay item for CL B Rock; and it
knew that the text of Special Provision, Item 120, must be understood with that
“omission” in mind.
Amorello is not correct that Item 120 work is limited to only the four types of
materials identified in quantity estimates (A through D). The plain text of the special
Provision makes clear that “materials of every description” are included.
CONCLUSION
Amorello’s appeal is without merit. The Special Provision plainly required it to
excavate, remove and dispose of “material of every description” “within the limits of the
Contract.”
RECOMMENDATION
The decision of the Claims Committee should be upheld.
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Respectfully submitted,
Stephen H. Clark
Administrative Law Judge
Dated: July 26, 2005
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