Fortney & Weygandt, Inc. v. Lewiston DMEP IX, LLC , 2019 ME 175 ( 2019 )

MAINE SUPREME JUDICIAL COURT Reporter of Decisions
Decision: 2019 ME 175Docket: BCD-18-358
Argued: October 7, 2019
Decided: December 30, 2019
Panel: SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and HUMPHREY, JJ.
FORTNEY & WEYGANDT, INC.
v.
LEWISTON DMEP IX, LLC, et al.
HJELM, J.
[¶1] In three cases arising from a set of commercial construction
projects, Lewiston DMEP IX, LLC, et al. (collectively, GBT),1 a group of real estate
developers, appeal from a combined judgment entered in the Business and
Consumer Docket (Murphy, J.) after a consolidated jury-waived trial. In the
judgment, the trial court determined that, in addition to damages for breach of
contract, the general contractor, Fortney & Weygandt, Inc. (F&W), was entitled
to remedies, including attorney fees, pursuant to Maine’s prompt payment
statutes, 10 M.R.S. §§ 1111-1120 (2018); that F&W was also entitled to attorney
1 Adopting the practice of the trial court and the parties, we refer to the nine appellants in this
matter collectively as GBT. The appellants are Lewiston DMEP IX, LLC; Auburn DMEP IX, LLC; Turner
DMEP X, LLC; West Paris DMEP X, LLC; Oakland DMEP IX, LLC; Dollar Texas Properties IX, LLC; Dollar
Texas Properties X, LLC; Dollar Properties East, LLC; and GBT Realty Corporation.
2
fees pursuant to the terms of the parties’ contract; and, addressing GBT’s
counterclaims, that GBT was estopped from seeking to enforce a contractual
right to liquidated damages against F&W. We affirm the judgment with respect
to GBT’s counterclaims for liquidated damages. As to the prompt payment
remedies allowed to F&W, we affirm in part but vacate in part and remand for
reconsideration of damages. Finally, although F&W is entitled to an award of
attorney fees and costs pursuant to the prompt payment statutes, we vacate the
portion of the judgment allowing F&W any separate recovery of attorney fees
pursuant to the parties’ contract.
I. BACKGROUND
[¶2] We draw the following account of this case from the procedural
record and from the facts as found by the trial court, which are supported by
competent evidence in the record. See Vt. Mut. Ins. Co. v. Ben-Ami, 2018 ME 125,
¶ 2, 193 A.3d 178.
[¶3] In 2014, GBT, a commercial real estate developer based in
Tennessee, entered into a contract with F&W, a general contractor based in
Ohio, for F&W to construct five retail-store buildings in Maine. The terms of the
parties’ agreement included a date by which each building project would reach
“substantial completion,” a term defined in the agreement as “sufficiently
3
complete in accordance with the Contract Documents so that the Owner may
occupy or utilize the Project . . . for the use for which it is intended, without
unscheduled disruption.” According to the contract documents, if a project had
not reached substantial completion by the contracted date, F&W would owe
GBT liquidated damages calculated at a specific rate.
[¶4] For a number of reasons, including unusually harsh winter weather
conditions and delays caused by GBT’s own conduct, none of the five projects
reached substantial completion by the contracted dates. As delays arose, F&W
employees notified GBT and requested extensions of the substantial
completion dates. At the same time, throughout the construction process, F&W
employees also submitted a succession of revised schedules to GBT for each
project, often indicating substantial completion dates that were later than the
contracted dates. Frequently, GBT did not respond to these notifications and
updated schedules.2 In some of its communications with F&W, however, GBT
signaled its acknowledgement that the substantial completion dates had been
2 Even beyond the absence of any complaints by GBT about schedule changes, the timeline for one
of the projects—Lewiston—was extended pursuant to GBT’s express request. When F&W sent an
updated schedule in response to that request, a GBT representative indicated agreement with the
extended completion date and cautioned F&W not to “finish early.” When F&W asked GBT to issue a
change order to update the substantial completion date that GBT itself requested, GBT agreed to do
so but never actually issued the change order.
4
extended.3 In addition, several times, GBT’s vice president of construction told
F&W representatives that time extensions would be addressed after the
projects were complete, with GBT to issue a final, no-cost change order that
would extend the contracted substantial completion dates for all five projects.4
[¶5] Even after the contracted substantial completion dates had passed
and continuing as late as August of 2015, GBT issued dozens of change orders
for the projects, expanding the scope of F&W’s work for a number of reasons,
including unforeseen site issues, weather conditions, and changes to
landscaping plans.
[¶6] Previously, GBT had entered into contracts for F&W to construct
nine stores in Pennsylvania and Ohio, which would be used by the same
third-party retailer that was to occupy the Maine stores. The contract
documents for those out-of-state projects were the same as the ones used for
the Maine projects. Although most of the Pennsylvania and Ohio projects
For example, on January 30, 2015, the third of the five contracted dates, a GBT employee sent
3
an email to a F&W employee purportedly setting “new dates” for four of the five projects. F&W
employees understood these “new dates” to be updated substantial completion dates.
4A contracted date of substantial completion could be amended only through a change order. The
change order form, which only GBT could create, edit, or issue, included a space to indicate the
number of days by which the project time would need to be extended. Several times, after GBT issued
a change order indicating that the project time would be changed by zero days, F&W employees
manually crossed out the zero and wrote numbers in an attempt to document time extensions that it
believed GBT had agreed to. GBT gave no response to these manual entries.
5
reached substantial completion after the contracted dates had passed, GBT did
not seek liquidated damages in any of those instances.
[¶7] As the result of GBT’s apparent acquiescence to time extensions as
manifested by a combination of its statements, conduct, and silence, F&W
employees believed that GBT had agreed to the updated timelines and that GBT
would not seek liquidated damages if the projects reached substantial
completion after the originally-contracted dates. Because F&W relied on its
belief that GBT was agreeing to these extensions, F&W continued to work until
August of 2015 even though GBT had stopped making progress payments in
June. For the same reason, F&W did not insist that GBT issue change orders
extending the contracted substantial completion dates as delays arose. The
court concluded that, given the totality of the circumstances, F&W’s belief that
GBT had agreed to the extended dates was reasonable and justified, as was
F&W’s reliance on those changes.
[¶8] Although GBT stopped paying F&W in June, it actually had decided
to discontinue payments two months earlier. GBT did not, however, notify F&W
of its decision at that time. When F&W’s president contacted GBT and asked
why the payments had stopped and whether they would resume, he received
no response. Because of GBT’s nonpayment, F&W stopped working on the
6
projects on August 7, 2015, after notifying GBT, but it remained ready and able
to resume work if GBT were to pay the overdue invoices and issue change
orders. Instead of doing that, GBT sent letters to F&W attempting to impose
liquidated damages calculated on a per diem basis from the original contracted
substantial completion dates.
[¶9] In September and October of 2015, F&W commenced three separate
actions against GBT in the Superior Court (Kennebec, Androscoggin, and Oxford
Counties), alleging breach of contract and violation of the prompt payment
statutes, and seeking enforcement of mechanic’s liens. GBT filed counterclaims
seeking liquidated damages and damages for breach of contract based on
allegations that some of F&W’s work was incomplete or defective.5 The three
matters were transferred in the interim to the Business and Consumer Docket.
[¶10] GBT and F&W each filed multiple motions for summary judgment.
After a hearing, the court (Murphy, J.) entered summary judgments in favor of
F&W on its claims for breach of contract, concluding as a matter of law that
5 Additionally, in eighteen separate but related matters, a number of subcontractors filed
contract- and lien-related claims against F&W and GBT, and a flurry of counterclaims and crossclaims
ensued among all of the parties. Ultimately, all claims except for those solely between F&W and GBT
were resolved and are not part of this appeal.
7
F&W was entitled to payment on all of its unpaid invoices.6 The court also
entered summary judgments in favor of F&W on portions of GBT’s
counterclaims that alleged defective or incomplete work by F&W. The court
denied the portion of F&W’s motions seeking judgments on GBT’s
counterclaims for liquidated damages, which F&W asserted were barred by
waiver and equitable estoppel, because the court concluded that there were
issues of material fact concerning those affirmative defenses. The summary
judgment proceedings also did not resolve F&W’s claims for an award of
prompt payment remedies or its claims for enforcement of mechanic’s liens. On
this appeal, neither party challenges any aspect of the court’s summary
judgment order.
[¶11] In November of 2017 and January of 2018, the court held a
nine-day consolidated jury-waived trial on the remaining issues. After being
presented with the testimony of many witnesses and a mountain of
documentary exhibits, the court issued a fifty-eight-page combined judgment
containing detailed findings. The court determined that F&W was entitled to a
judgment on GBT’s counterclaims for liquidated damages because, through its
6 This included an invoice for amounts that GBT withheld as “retainage,” which was a contractual
ten-percent withholding from the amount due on each progress payment made before substantial
completion.
8
statements, conduct, and silence, GBT had waived and was equitably estopped
from asserting such claims; and that F&W was entitled to penalties, interest,
and attorney fees, all pursuant to the prompt payment statutes.7
[¶12] GBT did not file a motion for amended or additional findings, see
M.R. Civ. P. 52(b), or any other post-judgment motion. For its part, F&W moved
for the court to amend the judgment, see M.R. Civ. P. 59(e), by adding a
determination that it was entitled to attorney fees and costs based not only on
the prompt payment statutes but also pursuant to the terms of the parties’
contract. Over GBT’s objection, the court granted F&W’s motion and amended
the combined judgment accordingly.
[¶13] GBT appeals to us from the combined judgment.
II. DISCUSSION
[¶14] GBT asserts that the trial court erred in three of its determinations:
that the doctrines of equitable estoppel and waiver barred its claims against
F&W for liquidated damages; that F&W was entitled to prompt payment
7 The court also entered a judgment in F&W’s favor on GBT’s remaining counterclaims alleging
incomplete or defective work. GBT does not challenge that portion of the court’s judgment on appeal,
and we do not discuss it further. Additionally, although the judgment left F&W’s claims for
enforcement of mechanic’s liens unresolved, those counts were dismissed during the pendency of
this appeal after we raised the issue during oral argument, resulting in a final judgment on the claims
that are before us. See Kittery Point Partners, LLC v. Bayview Loan Servicing, LLC, 2018 ME 35, ¶ 6,
180 A.3d 1091 (“Absent an exception to the final judgment rule, a trial court’s decision is not
appealable unless it resolves all claims against all parties.”).
9
remedies; and that the terms of the parties’ contract allowed F&W to recover
attorney fees and costs. We address each of those arguments in turn.
A. Equitable Estoppel8
[¶15] GBT challenges the sufficiency of the evidence supporting the
court’s findings on the elements of equitable estoppel. We review a judgment
entered on equitable estoppel grounds “for clear error as to factual findings and
for abuse of discretion as to the application of principles of equity to those
facts.” Dep’t of Health & Human Servs. v. Pelletier, 2009 ME 11, ¶ 15, 964 A.2d
630. “An abuse of discretion may be found where an appellant demonstrates
that the decisionmaker exceeded the bounds of the reasonable choices
available to it, considering the facts and circumstances of the particular case
and the governing law.” Sager v. Town of Bowdoinham, 2004 ME 40, ¶ 11,
845 A.2d 567.
[¶16] Equitable estoppel is an affirmative defense predicated on the
principle that “[o]ne who has induced another to believe what is untrue may
not later assert the truth.” City of Auburn v. Desgrosseilliers, 578 A.2d 712, 714
8Because we affirm the judgment in F&W’s favor on GBT’s counterclaims for liquidated damages
based on the doctrine of equitable estoppel, we need not and therefore do not reach GBT’s contention
that the court erred by concluding that F&W also established its affirmative defense of waiver, which
is the voluntary or intentional relinquishment of a known right—here, the right to seek liquidated
damages. See Blue Star Corp. v. CKF Props., LLC, 2009 ME 101, ¶ 26, 980 A.2d 1270.
10
(Me. 1990) (quotation marks omitted); see M.R. Civ. P. 8(c); Pelletier, 2009 ME
11, ¶ 17, 964 A.2d 630. The doctrine “precludes a party from asserting rights
which might perhaps have otherwise existed, against another person who has
in good faith relied upon [the party’s] conduct, and has been led thereby to
change his position for the worse, and who on his part acquires some
corresponding right.” Pelletier, 2009 ME 11, ¶ 17, 964 A.2d 630 (alteration
omitted) (quotation marks omitted). “Equitable estoppel requires a
misrepresentation that may arise through a combination of misleading
statements, conduct, or silence.” Blue Star Corp. v. CKF Props., LLC, 2009 ME
101, ¶ 27, 980 A.2d 1270 (quotation marks omitted); see Pelletier, 2009 ME 11,
¶ 18, 964 A.2d 630 (“A misrepresentation need not consist solely of an
affirmative statement . . . .”).
[¶17] The court’s decision in this case was based on a combination of all
three forms of misrepresentations—statements, conduct, and silence—and
each element of the court’s analysis, described below, was supported by the
record and consistent with the law.
[¶18] First, GBT made misleading statements. For example, the court
found that a GBT employee expressly told F&W employees that, once the
projects were complete, GBT would issue a final change order updating the
11
substantial completion dates. Further, the court found that on the third of the
five contracted substantial completion dates, another GBT employee
communicated a set of “new dates” to F&W, listing dates that were well beyond
the contracted dates.
[¶19] Second, GBT’s conduct was misleading. As the court found, in
almost all of the parties’ nine similar out-of-state projects that were governed
by identical contracts, F&W did not meet the substantial completion dates, and
GBT did not seek to assess liquidated damages. Additionally, on the Maine
projects, GBT issued many change orders calling for different or additional
work that F&W was to perform after the contracted dates had passed.
[¶20] Finally, GBT’s silence in response to F&W’s multiple requests for
time extensions was misleading, especially in the context of GBT’s direction that
F&W should not be concerned with the timeline.9
[¶21] These findings are supported by competent evidence in the record
and, contrary to GBT’s argument, are not insufficient as a matter of law to
support the court’s determination that, in various ways, GBT misrepresented
9 As the court acknowledged, GBT had no contractual duty to object to F&W’s requests for time
extensions. Although “[e]quitable estoppel based on a party’s silence will only be applied when it is
shown by clear and satisfactory proof that the party was silent when he had a duty to speak,” Dep’t
of Human Servs. v. Bell, 1998 ME 123, ¶ 8, 711 A.2d 1292 (alterations omitted) (quotation marks
omitted), the court did not err by considering GBT’s silence in combination with other relevant
evidence in determining that GBT had misrepresented its intentions to F&W.
12
its intentions with regard to liquidated damages. Competent record evidence,
which we describe above, see supra ¶ 7, also supports the court’s findings that
F&W relied on GBT’s misrepresentational acts and omissions and that F&W’s
reliance was both “justified”—i.e., reasonable—and detrimental.10 See, e.g., Cty.
Forest Prods., Inc. v. Green Mountain Agency, Inc., 2000 ME 161, ¶¶ 8-15, 25-28,
758 A.2d 59.
[¶22] GBT also contends that the court could not properly apply the
doctrine of equitable estoppel absent evidence that GBT explicitly told F&W
that liquidated damages would not be assessed. We are unpersuaded. As the
trial court found, liquidated damages were inextricably linked to the
substantial completion dates, so the combination of GBT’s misleading
statements and its silence regarding those dates amounted to
misrepresentations about its intent to assess liquidated damages. See Pelletier,
10Given the court’s findings described in the text, we are also unpersuaded by GBT’s argument
that the court failed to make sufficiently detailed findings that F&W relied to its detriment on GBT’s
misrepresentations. Even if the court’s express findings were insufficient, however, because GBT
failed to request amended or additional findings pursuant to Maine Rule of Civil Procedure 52(b), we
would infer that the findings were made because they are supported by the record evidence. See Doe
v. Tierney, 2018 ME 101, ¶ 15, 189 A.3d 756 (“[I]n the absence of a motion for additional findings of
fact and conclusions of law pursuant to M.R. Civ. P. 52(b), we will infer that the trial court made any
necessary findings that would be supported by evidence in the record to support its ultimate
conclusion.”). The same is true for GBT’s argument that the court should have engaged in a more
detailed analysis to equitably adjust the substantial completion dates.
13
2009 ME 11, ¶ 18, 964 A.2d 630 (“A misrepresentation need not consist solely
of an affirmative statement . . . .”).
[¶23] The court’s findings do not contain clear error, and its ultimate
determination that equitable estoppel barred GBT’s claim for liquidated
damages was well within its discretion.
B. Prompt Payment Remedies
[¶24] GBT next argues that the trial court erred by awarding F&W any
remedies pursuant to Maine’s prompt payment statutes, 10 M.R.S.
§§ 1111-1120. GBT also asserts more narrowly that the court erred by
including the unpaid retainage invoice in the amount subject to prompt
payment remedies and that, pursuant to section 1118(3), the court should have
excluded from the calculation of those remedies at least the amount that the
court found GBT had withheld in good faith. On an appeal addressing a
judgment on a statutory prompt payment claim, we review issues of law de
novo and the trial court’s factual findings for clear error. Bernier v. Merrill Air
Eng’rs, 2001 ME 17, ¶ 7, 770 A.2d 97; see Cellar Dwellers, Inc. v. D’Alessio, 2010
ME 32, ¶ 17, 993 A.2d 1 (reviewing factual findings bearing on the issue of
prompt payment remedies for clear error).
14
[¶25] It was undisputed that GBT withheld payment on several invoices
for progress payments and retainage beyond the twenty-day limit prescribed
by the prompt payment statutes. In total, those unpaid amounts approached
$1.5 million. Through the combination of the summary judgment and
determinations reached after the trial, the court concluded that F&W was
entitled to be paid for all of those invoiced amounts and that GBT did not have
a good faith basis to withhold payments based on any contention that F&W’s
work was incomplete or defective. Although, for that reason, the court
committed no error in determining that F&W was entitled generally to
remedies created by the prompt payment statutes, including on the retainage
payment withheld, we conclude that the court did err in a different aspect of its
analysis. The error arises because the court failed to consider the mitigating
effect of its finding that GBT had, in good faith, withheld $498,000 as liquidated
damages that it claimed were contractually owed by F&W.
[¶26] The prompt payment statutes are a collection of rules governing
payment between or among parties to construction contracts in a way that
“augment[s] damages that are traditionally available for contract or quantum
meruit claims.” Jenkins, Inc. v. Walsh Bros., Inc., 2001 ME 98, ¶ 24, 776 A.2d
151229. The statutory remedies can comprise interest, penalties, and attorney
fees. See 10 M.R.S. §§ 1113, 1118.
[¶27] Section 1113 governs payments by “owner[s]” to “contractor[s].”11
Here, GBT was the owner of the properties, and F&W was a contractor. See
10 M.R.S. § 1113(3), (6). Absent some other agreement between the parties,
section 1113(3) requires an owner to pay an invoice within twenty days after
either the billing period ends or the invoice is delivered, whichever is later. If a
payment is not made before the applicable deadline, “the owner shall pay the
contractor interest on any unpaid balance due beginning on the 21st day,” 10
M.R.S. § 1113(4), and penalties are to be awarded in “an amount equal to 1%
per month of all sums for which payment has wrongfully been withheld,”
10 M.R.S. § 1118(2). In addition, the “substantially prevailing party” is entitled
to an award of attorney fees and expenses. 10 M.R.S. § 1118(4); see Jenkins,
2001 ME 98, ¶ 31, 776 A.2d 1229 (explaining that the attorney fees remedy is
available only to a party who succeeds in demonstrating its entitlement to the
other prompt payment remedies).
[¶28] In some circumstances, however, an owner-obligor is statutorily
entitled to withhold payments without incurring liability pursuant to the
11Title 10 M.R.S. § 1114 (2018) governs payments by a “contractor” to a “subcontractor” or by a
subcontractor to a “material supplier.” See 10 M.R.S. § 1111 (2018) (defining those terms).
16
prompt payment statutes. “A payment is not deemed to be wrongfully withheld
if it bears a reasonable relation to the value of any claim held in good faith by
the owner, contractor or subcontractor against which an invoicing contractor,
subcontractor or material supplier is seeking to recover payment.” 10 M.R.S.
§ 1118(3) (emphasis added); see Cellar Dwellers, 2010 ME 32, ¶ 18, 993 A.2d 1(“[T]he availability of prompt payment remedies depends upon whether
payment has been wrongfully withheld.” (emphasis added) (quotation marks
omitted)); Jenkins, 2001 ME 98, ¶ 24, 776 A.2d 1229. The statute also provides
that an owner may withhold payment “in whole or in part under a construction
contract in an amount equalling the value of any good faith claims against an
invoicing contractor, subcontractor or material supplier.” 10 M.R.S. § 1118(1).
[¶29] We are unpersuaded by GBT’s arguments that the trial court
should not have imposed any prompt payment statute remedies, or that the
court should have excluded the unpaid retainage invoice from the amount
subject to prompt payment remedies. Even if we were persuaded by GBT’s
argument that F&W was required to have performed in accordance with the
contract in order to be entitled to prompt payment remedies pursuant to
section 1113, the court found that F&W did so perform—a finding that was not
17
clearly erroneous.12 Additionally, in its summary judgment order, the trial
court determined as matter of law that F&W was entitled to damages based on
the full amount of all of the unpaid invoices, including the retainage. GBT has
not challenged that conclusion, thereby vitiating its contention that F&W failed
to prove that it completed the steps necessary to be entitled to the retainage
withheld and that the court therefore erred by considering that withholding to
be “wrongful.” We also decline to disturb the trial court’s determination that
GBT’s claims alleging defective or incomplete work were not held in good faith.
[¶30] This leaves GBT’s assertion that the court erred by imposing
prompt payment remedies on the entire amount that GBT withheld when the
court found that some of that amount was withheld based on GBT’s good-faith
belief that it was entitled to recover liquidated damages from F&W. More
specifically, the court found that, even though GBT was ultimately unsuccessful
on the merits, GBT withheld $498,000 as liquidated damages in good faith.13
12 Section 1114(3) requires a contractor to pay a subcontractor, or a subcontractor to pay a
material supplier, within a specific time “when a subcontractor or material supplier has performed
in accordance with the provisions of a contract.” Section 1113 does not contain similar language.
Given the court’s finding that F&W did perform pursuant to the contract, we need not address the
question of whether, despite that difference in the statutes, the same requirement should be imposed
in disputes governed by section 1113.
13 Those determinations were not incompatible because GBT could have believed in good faith
that its claims for liquidated damages were legitimate even though, on the merits, it ultimately did
not prevail on those claims.
18
Despite that finding, the court ultimately concluded that F&W was entitled to
prompt payment remedies calculated on the basis of all payments that GBT
withheld—including the amount withheld in good faith as liquidated
damages—because the total “amount withheld far exceed[ed] the [value] of
[GBT’s] potential liquidated damages [claims].”
[¶31] This conclusion is affected by an erroneous application of sections
1118(1) and 1118(3). Those statutory provisions do not provide for the court
to simply weigh the value of a claim held in good faith against the total amount
withheld and then, where the two are not in some measure of balance, impose
prompt pay remedies based on the total amount withheld. Further, there need
not be a direct connection between the contractor’s charges for goods and
services set out in the invoices and the reason why the obligor withheld
payment. See 10 M.R.S. § 1118(1). Here, for example, the amount that GBT
withheld was not based on a good faith dispute about the charges in the
invoices themselves, but rather was grounded in an extrinsic claim against
F&W arising from the projects at issue.
[¶32] Instead, pursuant to the statutes, “[p]enalties may not be imposed
. . . on any amount withheld that bears a reasonable relation to the value of any
claim held in good faith.” Jenkins, 2001 ME 98, ¶ 24, 776 A.2d 1229 (emphases
19
added) (quotation marks omitted); see 10 M.R.S. § 1118(3); Cellar Dwellers,
2010 ME 32, ¶ 20, 993 A.2d 1. Consequently, the trial court should have, in
some way, accounted for the value of GBT’s liquidated damages claims held in
good faith when considering the amount that is subject to prompt payment
statute remedies available to F&W.
[¶33] For these reasons, we vacate the portion of the judgment denying
GBT any statutory accommodation based on the amount it withheld in good
faith in the court’s determination of damages to which F&W is entitled pursuant
to the prompt payment statutes, and we remand for the court to reconsider and
recalculate that portion of the award.
C. Attorney Fees Pursuant to the Contract
[¶34] Finally, GBT argues that the court erred when it concluded that,
apart from an award of attorney fees that is available pursuant to the prompt
pay statutes, F&W was also entitled to attorney fees pursuant to the terms of
the parties’ contract.14 “We review the meaning of a contract de novo and
interpret an unambiguous provision according to the plain meaning of its
terms.” Kondaur Capital Corp. v. Hankins, 2011 ME 82, ¶ 19, 25 A.3d 960.
Although the court concluded that F&W is entitled to its attorney fees and expenses, at oral
14
argument the parties indicated that they had not yet filed submissions addressing the amount of
awardable fees and expenses.
20
[¶35] The contract documents provided for a tiered approach to “dispute
mitigation or resolution.” The first of the dispute resolution mechanisms was
for the parties to engage in “good faith direct discussions.” If a dispute
remained unresolved after those discussions, the parties were to engage in
mediation. The contract went on to provide that, if the issue was still
unresolved, the parties then were to submit the matter to a “binding dispute
resolution procedure,” prescribed specifically as arbitration.15 The arbitration
provisions of the parties’ contract stated:
12.4 BINDING DISPUTE RESOLUTION If the matter is unresolved
after submission of the matter to a mitigation procedure or to
mediation, the Parties shall submit the matter to the binding dispute
resolution procedure selected below.
Arbitration using the current Construction Industry
Arbitration Rules of the AAA or the Parties may mutually
agree to select another set of arbitration rules. The
administration of the arbitration shall be as mutually agreed
by the Parties. If the Parties cannot agree, then it shall be
administered by AAA.
12.4.1 The costs of any binding dispute resolution procedures
and reasonable attorneys’ fees shall be borne by the
non-prevailing Party, as determined by the adjudicator of the
dispute.
12.4.2. VENUE The venue of any binding dispute resolution
procedure shall be the location of the Project, unless the
Parties agree on a mutually convenient location.
The parties’ submissions on appeal suggest that, notwithstanding this contractual provision,
15
they did not avail themselves of the binding dispute resolution process.
21
(Emphases added.)
[¶36] The contract therefore unambiguously states that the
nonprevailing party will bear attorney fees and costs related to “binding
dispute resolution procedures,” with “the binding dispute resolution
procedure” contractually specified to be arbitration. The attorney fees
provision contained in this “binding dispute resolution” section of the contract
plainly does not contemplate an award of attorney fees outside the context of
arbitration, and the trial court therefore erred when it concluded otherwise.16
This, however, does not affect the court’s determination that F&W’s is entitled
to its attorney fees and costs pursuant to separate authority, namely, the
prompt payment statutes.
III. CONCLUSION
[¶37] In its thorough analysis, the court did not err or abuse its discretion
by concluding that GBT was equitably estopped from recovering liquidated
damages against F&W. We therefore affirm, in full, the judgment in F&W’s favor
16 The court noted in its order amending the judgment that GBT itself had sought to recover its
attorney fees and expenses pursuant to the provisions of the contract. Nonetheless, the issue has
been preserved for our consideration because GBT objected to F&W’s post-trial motion to amend
seeking such an award, the court granted F&W’s motion on the merits, and GBT has argued the point
on appeal. See Verizon New Eng., Inc. v. Pub. Utils. Comm’n, 2005 ME 16, ¶ 15, 866 A.2d 844 (“An issue
is raised and preserved if there was a sufficient basis in the record to alert the court and any opposing
party to the existence of that issue.” (quotation marks omitted)).
22
on GBT’s counterclaims for liquidated damages. We affirm the judgment
awarding F&W prompt payment remedies except to the extent that the remedy
ordered by the court failed to account for the value of GBT’s liquidated damages
claims that the court found GBT withheld in good faith. We remand for
reconsideration of that aspect of the judgment. Finally, we vacate the portion
of the judgment awarding attorney fees and costs to F&W pursuant to the terms
of the parties’ contract, leaving the court to assess attorney fees and costs only
as allowed by the prompt payment statutes.
The entry is:
Judgment affirmed in part and vacated in part.
Remanded for further proceedings as described
herein.
Michael R. Bosse, Esq., and Conor M. Shankman, Esq. (orally), Bernstein Shur,
Portland, for appellant Lewiston DMEP IX, LLC, et al.
David P. Very, Esq., Norman, Hanson & Detroy, LLC, Portland, Gavin G.
McCarthy, Esq., Pierce Atwood LLP, Portland, and Michael L. Fortney, Esq.
(orally), Stark & Knoll, Akron, Ohio, for appellee Fortney & Weygandt, Inc.
Business and Consumer Docket docket numbers RE-2015-06, RE-2015-11, and CV-2015-74
FOR CLERK REFERENCE ONLY