Semac Electric Co. v. Skanska USA Building, Inc.

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SEMAC ELECTRIC COMPANY, INC. v. SKANSKA
USA BUILDING, INC.
(AC 41054)
Alvord, Devlin and Norcott, Js.
Syllabus
The plaintiff subcontractor, E Co., sought to recover damages from the
defendant, S Co., for, inter alia, breach of contract in connection with
a dispute arising from a project relating to the expansion and renovation
of a hospital. Pursuant to its contract with S Co., E Co. agreed to perform
all electrical work for the project. The contract provided that E Co. had
a duty to coordinate with S Co., that E Co. had made allowances for
all hindrances and delays to its work, and that E Co. would work within
S Co.’s schedule, which S Co. may revise from time to time. S Co. had
the right to direct a change in E Co.’s work on written notice and, during
the course of the project, thirty-eight change orders were issued. After
several months, E Co. sent S Co. a notice, alleging a cardinal change
to the contract due to issues that arose during the preceding months
and asserting that it could only continue to perform under the contract
if S Co. agreed to additional financial terms. S Co. responded that E
Co.’s refusal to proceed under the contract constituted default and, the
next day, S Co. terminated E Co. E Co. alleged that S Co. had breached
the contract by its wrongful termination of E Co., and S Co. filed a
counterclaim, alleging, inter alia, breach of contract. S Co. also filed a
third-party complaint against K and T, the chief financial officer and
president of E Co., respectively, alleging, inter alia, fraudulent conduct.
The case was tried to the court, which rendered judgment in part for
S Co. on its counterclaim, and in favor of K and T on the third-party
complaint. On S Co.’s appeal and E Co.’s cross appeal to this court, held:
1. The trial court properly rejected E Co.’s claim that there had been a
cardinal change in the contract terms and properly concluded that E
Co. breached the contract by abandoning the project: the court properly
focused on the nature and impact of the delays on the work expected
of and performed by E Co., which were not extraordinary in a project
of this magnitude, and neither the character nor the nature of the work
expected of or performed by E Co. was altered in any way, and E Co.
was compensated for the changes in its work up until the time that it
issued its notice of cardinal change to S Co., E Co. was required to
anticipate unforeseen modifications to E Co.’s sequence of construction
and the schedule parameters of the contract when it signed the contract,
as the contract language demonstrated that the parties contemplated
the possibility of scheduling delays and changes; moreover, there was
no evidence that the change orders altered the nature of E Co.’s work,
and, in executing each change order, E Co. attested that it was compen-
sated for associated costs and delays, and it was clear that the changes
were not so profound that they were not redressable under the contract,
as they were, in fact, redressed via the change orders.
2. The trial court properly concluded that S Co. materially breached its
contract with E Co. by failing to provide E Co. with a forty-eight hour
cure period before terminating its contract with E Co.: even though S
Co. claimed that the court erred in assuming that it had terminated E
Co. pursuant to the contract provision requiring it to give E Co. forty-
eight hours to cure its breach, because S Co. pleaded in its counterclaim
that it had declared E Co. in default pursuant to the contract, the court
properly held the parties to their contractual obligations; moreover, S
Co.’s reliance on certain common-law principles overlooked the clear
contractual language requiring a cure period, which did not include any
exceptions, and which outlined the procedure if E Co. abandoned the
project or defaulted on its obligations and the court correctly determined
that S Co. should be held to the contract provisions because to hold
otherwise would excuse S Co.’s noncompliance with the contract and
would create a new and different agreement, which courts cannot do;
furthermore, the court’s enforcement of the cure period did not render
meaningless another provision of the contract stating that S Co.’s con-
tractual remedies were not exclusive, because S Co. could not turn to
the common law to avoid an express contractual obligation.
3. The trial court’s award of damages was not erroneous: this court disagreed
with S Co.’s claim that, due to E Co.’s material breach, S Co. was excused
from further performance of its contractual obligations and was entitled
to expectation damages, because S Co. also breached the contract by
failing to afford E Co. a forty-eight hour cure period, transforming its
termination for cause of E Co. into a termination for convenience and,
accordingly, S Co. could not claim entitlement to a common-law remedy
after forfeiting its right to a contractual remedy as a result of its own
breach; moreover, E Co. could not prevail on its claim that the court
erred in not awarding a termination payment pursuant to the contract,
because, although the court concluded that E Co. was entitled to a
termination payment, the court found that E Co.’s billing practices were
too irregular to award damages on the basis of its invoices, which
the contract had provided for, and, instead, calculated the payment by
determining the percentage of the project E Co. had completed and
multiplying that percentage by the contract price; although potentially
imprecise, it could not reasonably be argued that this method ran afoul
of the contract or was unfair to E Co.
4. The trial court did not err in finding that K and T did not commit fraud
when they swore under oath to the accuracy of invoices submitted to
S Co. for goods and services they represented to S Co. that they had
paid to other subcontractors, but actually never did pay; K’s and T’s
conduct strained the bounds of fraud, revealing, at best, gross incompe-
tence, but the court nevertheless found that, on the basis of its observa-
tion of K’s and T’s demeanor and attitude, neither K nor T acted with
fraudulent intent, and this court does not second-guess the court’s credi-
bility assessments.
Argued October 16, 2019—officially released February 11, 2020
Procedural History
Action to recover damages for, inter alia, breach of
contract, and for other relief, brought to the Superior
Court in the judicial district of Hartford, Complex Litiga-
tion Docket, where the defendant filed a counterclaim;
thereafter, the court, Young, J., granted the defendant’s
motion to implead Kevin Pope et al. as third-party defen-
dants, and the defendant filed a third-party complaint
against the third-party defendants; subsequently, the
court, Moukawsher, J., dismissed the defendant’s
claims of defamation and tortious interference, and the
matter was tried to the court, Moukawsher, J.; judgment
in part for the defendant on the counterclaim and judg-
ment for the third-party defendants on the third-party
complaint; thereafter, the court granted the defendant’s
motion for prejudgment interest, and the defendant
appealed and the plaintiff cross appealed to this
court. Affirmed.
Bruce Meller, pro hac vice, with whom were Michael
J. Donnelly, Kevin W. Munn and, on the brief, Eric B.
Miller, for the appellant-cross appellee (named
defendant).
Louis R. Pepe, with whom was Laura W. Ray, for
the appellee-cross appellant (plaintiff).
Richard P. Weinstein, with whom, on the brief, was
Sarah Black Lingenheld, for the appellees (defendant
Kevin Pope et al.).
Opinion
DEVLIN, J. In this action arising from the expansion
and renovation of Stamford Hospital (hospital), both
parties, the plaintiff, Semac Electric Company, Inc.
(Semac), and the defendant, Skanska USA Building, Inc.
(Skanska), appeal from the judgment of the trial court,
challenging the court’s determinations that they both
breached the contract between them, and awarding
Skanska damages in the amount of $3,857,130.77,1 as
reimbursement for funds that Skanska had overpaid to
Semac for work that Semac had not performed. Skanska
also claims that the trial court erred in finding that
the individual third-party defendants, Kevin Pope and
Thomas Scanlon, the chief financial officer of Semac
and the president of Semac, respectively, did not engage
in fraudulent conduct when they signed, under oath,
invoices misrepresenting that Semac had paid other
subcontractors for certain goods and services. We
affirm the judgment of the trial court.
The trial court set forth the following relevant facts.
As the general contractor retained by the hospital to
serve as the construction manager for the construction
of a new building on its existing campus (project), Skan-
ska entered into a subcontract with Semac, dated March
5, 2014, pursuant to which Semac agreed to perform
all necessary electrical work on the project for the sum
of $14,785,462. On October 19, 2015, after working for
several months on the project, Scanlon delivered to
Skanska a ‘‘Notice of Cardinal Change and Material
Breach of Subcontract’’ (Notice of Cardinal Change),
wherein Semac stated: ‘‘[T]here has been a cardinal
change to our subcontract due to the drastic and unfore-
seen modifications and changes that have been made
to Semac’s sequence of construction and the schedule
parameters set forth in the subcontract, which has
unreasonably altered the character of the work and
unduly increased its cost.’’ In the multipage letter,
Semac identified several specific issues that arose dur-
ing the preceding months of construction, and asserted:
‘‘As a result of the cumulative effect and the severe
magnitude and quality of the scheduling and sequencing
delays and disruptions and other assumptions contem-
plated by the subcontract, the entire nature of the elec-
trical work for this [p]roject is something totally differ-
ent than anyone reasonably anticipated or
contemplated at the time of entering into a subcon-
tract.’’ Semac asserted that it could continue to perform
under the subcontract only if Skanska agreed to an
increase in the contract price, and to certain additional
financial terms. Semac concluded: ‘‘We trust that . . .
Skanska will work with us to reach this equitable solu-
tion. Otherwise, Semac will be excused from further
performance and cease work as of October 23, 2015,
in which case we would seek compensation for all work
performed through that date.’’
In response, on October 21, 2015, Skanska advised
Semac that its refusal to proceed under the terms of
the subcontract constituted a default under that con-
tract, and that, if Semac failed to cure the default, Skan-
ska would pursue its contractual rights.
The next day, on October 22, 2015, Skanska termi-
nated Semac, and notified Semac that it was taking
possession of Semac’s ‘‘materials, tools, appliances,
equipment and other items.’’ (Internal quotation marks
omitted.) In turn, Semac accused Skanska of material
breach of the subcontract on the ground of wrongful ter-
mination.
On October 23, 2015, Semac commenced this action.
In its second amended complaint, Semac alleged that
Skanska had materially breached the contract by virtue
of the cardinal changes of which it had given Skanska
notice on October 19, 2015, failing to make monthly
progress payments for work completed by Semac, fail-
ing to compensate Semac for additional work that was
performed by Semac and was not required by the origi-
nal contract, and failing to pay the overtime premium
required by Semac to complete that work. Semac
claimed that Skanska had wrongfully terminated it and
confiscated its tools and equipment. In addition to the
breach of contract and wrongful termination counts,
Semac alleged causes of action sounding in quantum
meruit, breach of the implied covenant of good faith
and fair dealing, violation of the Connecticut Unfair
Trade Practices Act, General Statutes § 42-110a et. seq.,
conversion, and civil theft. Semac sought monetary
damages, including statutory interest and attorney’s
fees pursuant to General Statutes § 42-158j, and declara-
tory relief.
Skanska essentially denied all of Semac’s allegations,
and asserted multiple special defenses, asserting that
Semac waived many of its claims by, inter alia, failing
to submit claims for overtime premiums and accepting
payment for the work completed and failing to comply
with the dispute resolution provisions of the contract.
Skanska also filed a counterclaim alleging that Semac
breached the contract by failing to perform and com-
plete the work and effectively abandoning performance,
and committed fraud and civil theft by submitting billing
to Skanska for work that it had not performed and goods
that it had not procured.2 Finally, Skanska claimed a
‘‘setoff,’’ alleging: ‘‘To the extent that Semac is entitled
to damages from Skanska, Skanska is entitled to set
off for the amount of loss or damages sustained as a
result of Semac’s actions.’’
Semac denied all of Skanska’s special defenses and
the essential allegations of Skanska’s counterclaim.
Semac asserted multiple special defenses to Skanska’s
counterclaim, the most pertinent of which was its alle-
gation that Skanska’s claims were barred by its own
material breach of the contract. Like Skanska, Semac
alleged: ‘‘To the extent that Skanska is entitled to dam-
ages from Semac, Semac is entitled to a setoff for the
amount of loss or damage sustained as a result of Skan-
ska’s actions, as alleged in Semac’s [second]
amended complaint.’’
Skanska denied all of Semac’s special defenses. Skan-
ska also filed a third-party complaint against Pope and
Scanlon, alleging fraudulent misrepresentation regard-
ing Semac’s billing for services and goods that it never
performed or purchased. Pope and Scanlon denied the
allegations of the third-party complaint and asserted
seven special defenses to the claims against them. Skan-
ska denied all of Pope and Scanlon’s special defenses
to its third-party complaint.
The parties tried this case to the court over a period
of several days. Semac sought damages for Skanska’s
wrongful termination, in the amount of the unpaid por-
tion of the contract price. Skanska sought damages
from Semac for the $28,754,711.81 that Skanska had to
pay for other subcontractors and suppliers to complete
the electrical work that Semac failed to complete under
the contract3 and for the reimbursement of funds that
Semac had overbilled Skanska and which Skanska
had paid.
On August 23, 2017, the court issued a memoran-
dum of decision wherein it concluded that both Semac
and Skanska breached the contract. The court rejected
Semac’s claim of cardinal change and concluded that
Semac breached the contract when it refused to con-
tinue to perform its contractual obligations. The court
further found, however, that Skanska breached the con-
tract by terminating Semac without affording it forty-
eight hours to cure its breach in accordance with the
contract. The court concluded that, because Skanska
failed to afford Semac the contractual forty-eight hours
to cure its breach, it was required to pay Semac for the
work it had performed, and it was not entitled to recover
damages to complete the project. The court determined
that Semac had completed 65 percent of the work that it
had contracted to complete, and multiplied the revised
contract price of $19,114,535, which was determined
by multiple change orders agreed to and executed by
the parties, by that percentage to determine the amount
to which Semac was entitled for the work it had per-
formed, $12,424,447. Because, however, Semac had
already billed Skanska $14,785,764.36 for the work it
had performed, and Skanska had paid that amount,
the court concluded that Skanska was entitled to be
reimbursed $2,361,317.36. The court further found that
Skanska paid Semac for materials and labor allegedly
provided by two separate additional subcontractors,
but were never actually paid for by Semac. The court
concluded that Skanska was entitled to reimbursement
for those amounts—$769,790.93 and $252,273.51,
respectively. Finally, the court determined that Semac
had improperly marked up its labor cost and ordered
that it reimburse Skanska in the amount of $473,748.97
for this misrepresentation. The court thus awarded
Skanska a total of $3,857,130.77. The court found that
Skanska failed to prove that Pope and Scanlon engaged
in fraudulent conduct, and rejected the parties’
remaining claims.
Semac thereafter filed a motion for reconsideration
and correction of the court’s award of damages on the
grounds that the court allegedly omitted an undisputed
credit due to Semac for certain work it had performed
on the project and that certain portions of the court’s
damages award that compensated Skanska for overpay-
ments resulted in double recovery. The court granted
reargument, but rejected Semac’s arguments and
affirmed its earlier decision.
By way of an additional memorandum of decision
dated November 6, 2017, the trial court granted, over
Semac’s objection, Skanska’s motion for prejudgment
interest, increasing the total amount of damages to
$4,262,390.56. This appeal, filed by Skanska, and, cross
appeal, filed by Semac, followed.
The following general principles are pertinent to the
parties’ claims on appeal. ‘‘It is axiomatic that [t]he
scope of our appellate review depends upon the proper
characterization of the rulings made by the trial court.
To the extent that the trial court has made findings of
fact, our review is limited to deciding whether such
findings were clearly erroneous. [If], however, the trial
court draws conclusions of law, our review is plenary
and we must decide whether its conclusions are legally
and logically correct and find support in the facts that
appear in the record. . . .
‘‘In a case tried before a court, the trial judge is the
sole arbiter of the credibility of the witnesses and the
weight to be given specific testimony. . . . It is within
the province of the trial court, as the fact finder, to
weigh the evidence presented and determine the credi-
bility and effect to be given the evidence. . . .
‘‘[I]n private disputes, a court must enforce the con-
tract as drafted by the parties and may not relieve a
contracting party from anticipated or actual difficulties
undertaken pursuant to the contract, unless the con-
tract is voidable on grounds such as mistake, fraud or
unconscionability. . . . [C]ourts do not unmake bar-
gains unwisely made. . . . Although parties might pre-
fer to have the court decide the plain effect of their
contract contrary to the agreement, it is not within its
power to make a new and different agreement; con-
tracts voluntarily and fairly made should be held valid
and enforced in the courts. . . . In construing an unam-
biguous contract, the controlling factor is the intent
expressed in the contract, not the intent which the
parties may have had or which the court believes they
ought to have had. . . . [If] . . . there is clear and
definitive contract language, the scope and meaning of
that language is not a question of fact but a question
of law. . . .
‘‘The required elements necessary to sustain an action
for breach of contract are the formation of an agree-
ment, performance by one party, breach of the agree-
ment by the other party and damages. . . . The exis-
tence of a contract is a question of fact to be determined
by the trier on the basis of all of the evidence.’’ (Citations
omitted; internal quotation marks omitted.) Coppola
Construction Co. v. Hoffman Enterprises Ltd. Partner-
ship, 157 Conn. App. 139, 158–60, 117 A.3d 876, cert.
denied, 318 Conn. 902, 122 A.3d 631 (2015), and cert.
denied, 318 Conn. 902, 123 A.3d 882 (2015).
‘‘We often have stated that whether a contract has
been breached is a question of fact . . . and that this
court lacks the authority to make findings of facts or
draw conclusions from primary facts found. . . . Fac-
tual conclusions may be drawn on appeal, however, if
the subordinate facts found [by the trial court] make
such a conclusion inevitable as a matter of law . . .
or [if] the undisputed facts [as they appear] in the record
make the factual conclusion so obvious as to be inher-
ent in the trial court’s decision.’’ (Citations omitted;
internal quotation marks omitted.) Id., 171–72. With
these principles in mind, we turn to the parties’ claims
on appeal.
I
We begin with Semac’s assertion that the trial court
erred in rejecting its claim of cardinal change. Although
this claim is raised by way of Semac’s cross appeal,
and is thus not chronologically first in the procedural
posture of this appeal, it is the first of a chain of events
that gave rise to this litigation. We agree with the trial
court that there was not a cardinal change in the terms
of the contract and, therefore, that Semac breached the
contract by abandoning the project.
In addressing Semac’s claim of cardinal change, the
trial court set forth the following relevant facts. The
court first addressed the issue of ‘‘whether radical
changes were made to the character and timing of the
work.’’ The court found: ‘‘The job was building a twelve
floor hospital loaded with specialty wiring needs and
equipment. Three unanticipated events threw off the
detailed schedule adopted at the beginning of the job.
First, the steel frame of the building took longer than
expected. Second, the building’s glass siding—its cur-
tain wall—took far longer than expected, leaving large
parts of the building open to the weather. Third, Skan-
ska had to scrap its planned approach to coordinating
trades—the BIM (building information management)
coordination—and start over, imposing that duty on the
trades themselves.’’ (Internal quotation marks omitted.)
The court determined that ‘‘[t]he cumulative effect of
these delays meant that by the summer of 2015, Skanska
had lost months to these delays and was fighting to
recover its schedule.’’
Through its project manager, Mark Miller, Skanska
aggressively sought to make up for the time lost as a
result of the aforementioned delays to complete the
project by April, 2016, so that the hospital could open
in September, 2016. The court noted: ‘‘Miller pushed
his subcontractors pretty hard. From Semac he
demanded—and paid for—overtime work and pressed
the company to reach quickly, and then exceed, the
peak of its promised manpower—without any addi-
tional money. Miller’s plans also required Semac to
increase its flexibility in working around other trades
and working between various sections of the building.
Doubtless all this put a strain on Semac. It was a big
job; it was behind schedule, and everyone was required
to hustle to make the whole thing work.’’
The court considered the expert testimony offered
by the parties and found that Skanska’s witnesses were
more convincing in their testimony that ‘‘in large proj-
ects, changes and strains are routine’’ over the testi-
mony of Semac’s expert, who ‘‘dismissed even the
court’s suggestion that some delays on big projects are
routine.’’ The court reasoned: ‘‘This was no routine proj-
ect. . . . And as for time delays—assuming they mat-
ter—as much as Skanska can’t pretend the job was
routine, Semac can’t ignore that the job was completed
close to on time, in addition to never changing its basic
character. There was no year of delay; no surprise sec-
ond tower to erect. Indeed, Skanska credibly claims
that—for matters under its control—it would have met
the preopening substantial completion date described
in the schedule but for Semac bailing out at a critical
moment. It also rightly emphasizes that, out of sixty-
seven subcontractors, nobody bailed out but Semac.’’
The court found that Semac had made a profit every
month of the job, right up until October, 2015, when it
issued the Notice of Cardinal Change. The court found:
‘‘In fact, Skanska demanded—and got sworn declara-
tions with every change order saying that Semac had
been fully paid for any ‘delays, acceleration, or loss of
efficiency encountered by [Semac] in the performance
of the [w]ork through the date of this [c]hange order
. . . .’ ’’
The court noted the ‘‘many irregularities’’ in Semac’s
billing to Skanska, and found that ‘‘[s]ome of Semac’s
bid calculations are indecipherable and even misleading
to a degree. Its internal paper seems to equivocate about
profit. It shows a profit in one place and then takes it
away in another. Semac got paid by Skanska for some
goods and services without telling Skanska that it was
pocketing the money and not paying for the labor and
materials because of a claimed dispute. It hid payments
to its owner in its billing records by sending them to a
shell company for nonexistent materials for the job.
It changed managers on the job three times, suffered
significant employee turnover rates, and employed far
more than an ordinary number of cheaper and less
productive apprentices on the job. It told Skanska that it
was billing Skanska its actual costs for labor on contract
change jobs when it was instead pocketing a profit on
every hour worked. It swore in payment documents
that it had been paid for delays on the job and then
pulled the rug out from under Skanska by claiming the
opposite. It never adequately tied its alleged losses from
delays to particular parts of the job. And the written
records of communications before the [issuance to
Skanska of the Notice of Cardinal Change] do not nearly
reflect the kind of urgency that would suggest that
things happening on the site were at a critical juncture
requiring Skanska’s urgent financial intervention.
Instead, one day in October, 2015, there was a blunt
letter from Semac to Skanska demanding money and—
within several days—there was this lawsuit.’’
The court concluded: ‘‘This case doesn’t meet con-
temporary views in commercial cases of what is a radi-
cal or cardinal change. . . . In October, 2015, [Semac]
wrote to Skanska saying that it would leave if it did
[not] get the extra money that it asked for. When Skan-
ska refused to pay or even parley, Semac affirmed in
telephone calls that it would pick up its tools and go
home. The day after Semac affirmed this, Skanska found
that Semac had dismissed its own subcontracted labor
for the day and was busying its own men with removing
their equipment and tools from the site. Semac insists
that some men were somewhere still working on the
actual job, but the evidence supporting this claim is
vague and the evidence against it is better. Skanska
officials searched the site and found nobody from
Semac working anywhere. Semac never said who was
doing what, [or] where, that supposedly meant they
were still on the job. It has not proved it was carrying
on with the work while merely trying to negotiate.
‘‘Semac temporarily or permanently abandoned
working, and under Section 12.1 of the contract aban-
doning the work—even temporarily—is a material
breach of the contract. Thus, Semac materially
breached its contract with Skanska.’’
On appeal, Semac claims4 that ‘‘[s]ignificant delays
in the coordination work, the steel construction and
installation of the curtain wall—all Skanska’s responsi-
bilities—contributed to the cardinal change.’’ We are
unpersuaded.
Although our case law has not addressed an issue of
cardinal change per se, it has addressed an analogous
situation in which the final plans for a certain project
differed so substantially from the original plans for
which the parties had contracted that the initial contract
was rendered a nullity. Randolph Construction Co. v.
Kings East Corp., 165 Conn. 269, 334 A.2d 464 (1973).
In Randolph Construction Co., our Supreme Court held:
‘‘In dealing with contract provisions allowing alter-
ations or modifications, an appropriate standard for
substantiality is whether such changes unreasonably
alter the character of the work or unduly increase its
cost, or effect such a material change as to constitute
a radical departure from the original contract.’’ Id., 274.
‘‘The issue of substantiality, a determination of whether
the enumerated differences in the final plans were sub-
stantial, is a question of fact which depends on a consid-
eration of the circumstances. . . . The factual issue
includes . . . the total undertaking covered by the
writing, the amount of work affected by the alterations
and the net change in the cost of performance.’’ (Cita-
tions omitted.) Id.
Consistent with the court’s ruling in Randolph Con-
struction Co., other jurisdictions have explained that
‘‘[a] cardinal change is a drastic modification beyond
the scope of the contract that altered the nature of
the thing to be constructed.’’ (Internal quotation marks
omitted.) Pellerin Construction, Inc. v. Witco Corp.,
169 F. Supp. 2d 568, 587 (E.D.La. 2001). ‘‘By definition, a
cardinal change is so profound that it is not redressable
under the contract.’’ (Internal quotation marks omit-
ted.) Id. A cardinal change thus constitutes a breach
of contract. Id.
The standard courts look to in deciding whether a
cardinal change is present is ‘‘whether the modified job
was essentially the same work as the parties bargained
for when the contract was awarded.’’ (Internal quota-
tion marks omitted.) Air-A-Plane Corp. v. United
States, 408 F.2d 1030, 1033 (Ct. Cl. 1969). ‘‘[T]here is a
cardinal change if the ordered deviations altered the
nature of the thing to be constructed.’’ (Internal quota-
tion marks omitted.) Id. ‘‘[T]he problem is a matter of
degree varying from one contract to another and can
be resolved only by considering the totality of the
change and this requires recourse to its magnitude as
well as its quality.’’ (Internal quotation marks omitted.)
Id. ‘‘There is no exact formula . . . . Each case must
be analyzed on its own facts and in light of its own
circumstances, giving just consideration to the magni-
tude and quality of the changes ordered and their cumu-
lative effect upon the project as a whole.’’ (Internal
quotation marks omitted.) Id.
Here, Skanska and Semac entered into a 241 page
contract, pursuant to which Semac agreed to perform
all of the electrical work for the project. Section 2.4 of
exhibit E to the contract addressed the duty of Semac
to coordinate its work with Skanska, the hospital and
other subcontractors, and provided that Semac ‘‘shall
not be entitled to an adjustment of the [s]ubcontract
[a]mount or an extension of time for its field coordina-
tion activities as [Semac] shall anticipate and provide
for such activities in the [s]ubcontract [a]mount and
agreed time for performance.’’ Section 3.1 provided that
Semac represented that it had ‘‘taken into consideration
and made allowances for all hindrances and delays inci-
dent to its [w]ork as provided in Sections 2.2 and 2.4’’
Section 3.2 provided that Semac would perform its work
in accordance with the schedule set by Skanska ‘‘as it
may be revised and amended from time to time by
[Skanska], including in Section 9.2.’’ Section 9.2 pro-
vided that Skanska ‘‘shall be entitled to decide the time,
order and priority for performance of the various por-
tions of [Semac’s] [w]ork’’ and that Semac would ‘‘not
be entitled to an adjustment of the [s]ubcontract
[a]mount or an extension of time in connection with
any such direction by [Skanska] as [Semac] shall antici-
pate and provide for such activities in the [s]ubcontract
[a]mount and agreed time for performance.’’ Section
9.3 provided that Skanska could require Semac to
‘‘increase its labor force, number of shifts and/or over-
time operations, days of work, or to provide additional
equipment or materials.’’
Additionally, article 10 of exhibit E specifically
addressed, ‘‘Changes and Impacts.’’ Section 10.1 pro-
vided that Skanska had the right, in its discretion, to
direct a change upon written notice to Semac. The con-
tract set forth a detailed procedure for the implementa-
tion of change orders. Section 10.3 provided Skanska
with the sole discretion to determine whether different
pricing was required as a result of a change order, and,
if so, Skanska had the sole discretion to determine
the amount of additional compensation. Sections 10.3
through 10.9 specifically set forth the procedure that
Semac was required to follow to claim additional com-
pensation for the change orders, and provided that a
failure to follow those procedures would result in a
waiver of any such claim. Section 11.3 provided that,
in agreeing to the contract amount, Semac had assessed
its ability to recover additional compensation in connec-
tion with a work delay or interference.
Despite the comprehensive and unequivocal contract
language cited in the preceding paragraphs, Semac
claimed that there had been a cardinal change ‘‘to the
planned method and sequence of construction for the
electrical work’’ that it had contracted to perform.
Semac claimed that there had been a cardinal change
‘‘due to the drastic and unforeseen modifications and
changes that have been made to Semac’s sequence of
construction and the schedule parameters set forth in
the subcontract, which has unreasonably altered the
character of the work and unduly increased its cost.’’
Specifically, Semac stated that due to the failure to
provide a weathertight building on schedule, the
sequence of its work was different than originally con-
templated, and Semac was required to work faster and
under conditions that were not covered in the contract,
thus resulting in increased costs that were not antici-
pated by Semac.
Semac’s claim fails because, as aptly found by the
trial court, Semac was required to anticipate issues of
this nature when it submitted its bid for and signed the
contract. The explicit language of the contract demon-
strated clearly that the parties contemplated the possi-
bility, and even the likelihood, of delays and changes
in the originally planned schedule, and required Semac
to anticipate those possibilities. Although the project
experienced multiple delays, some of which were signif-
icant and some that resulted in the resequencing of
Semac’s work and a change of the time of the year
during which its workers were required to work, Semac
was still performing the same work that it had con-
tracted to perform. Although Skanska and Semac exe-
cuted thirty-eight change orders, there was no evidence
presented that the change orders altered the character
or nature of the work that Semac had originally con-
tracted to perform. In executing each change order,
Semac attested that it had been fully compensated ‘‘for
all costs, claims, markups, and expenses, direct or indi-
rect, attributable to this or any other prior [c]hange
[o]rders’’ and ‘‘for any delays, acceleration, or loss of
efficiency encountered by [Semac] in the performance
of the [w]ork through the date of this [c]hange [o]rder,
and the performance of this and any prior [c]hange
[o]rders by or before the date of [s]ubstantial [c]omple-
tion.’’ It is clear that the changes in the project were
not so profound that they were not redressable under
the contract, as they were, in fact, redressed via the
change orders executed by the parties. The final change
order, to which Semac agreed and for which it was
compensated, was dated October 12, 2015, less than
two weeks prior to Semac’s issuance to Skanska of the
Notice of Cardinal Change.
Moreover, despite representing to Skanska that it was
billing for actual costs of labor, Semac was actually
inflating its bills to make a profit ‘‘on every hour
worked.’’5 This fact alone belies Semac’s claim that the
changes to the project so materially affected its costs
that it had no choice but to abandon it and supports
the trial court’s determination that the situation leading
up to the claim of cardinal change could not have been
so urgent as to justify Semac’s demand for further funds.
Although the trial court employed colorful hyperbole
to demonstrate that the character of the final product,
the hospital, had not changed, Semac is correct in its
assertion that the end result does not dictate the exis-
tence of a cardinal change. That was not, however, the
focal point of the trial court’s reasoning. The trial court
focused, and properly so, on the nature and impact of
the delays on the work expected of and performed by
Semac. Those delays were not extraordinary in a project
of this magnitude and complexity. Neither the character
nor the nature of the work expected of or performed
by Semac was ever altered in any way, never mind in
a way that could be construed as substantial or radical.
Moreover, the delays were contemplated in the contract
between Semac and Skanska, and Semac was compen-
sated for them right up until it issued its Notice of
Cardinal Change to Skanska. On the basis of the forego-
ing, we agree with the trial court’s determination that
Semac failed to prove that there was a cardinal change
in the terms of its contract with Skanska and with its
conclusion that Semac materially breached the
contract.
II
We next address Skanska’s challenge to the trial
court’s conclusion that it also materially breached its
contract with Semac by failing to provide Semac with
a full forty-eight hour cure period before terminating
its contract. Skanska does not dispute that it waited
only twenty-four hours from the time that it rejected
Semac’s Notice of Cardinal Change to terminate Semac.
Skanska argues, however, that, for various reasons,
Semac was not entitled to a forty-eight hour cure period.
We disagree.
‘‘Although it is generally accepted that contracting
parties may reserve the right to terminate a contract
for convenience or cause upon a specified period of
notice . . . [i]f a party who has a power of termination
by notice fails to give the notice in the form and at the
time required by the agreement, it is ineffective as a
termination. . . . One who deviates from the terms and
the circumstances specified in the agreement for giving
notice . . . may be regarded as having repudiated the
contract, with all the effects of repudiation including
giving the injured party a right to damages . . . .’’ (Cita-
tions omitted; internal quotation marks omitted.) Cop-
pola Construction Co. v. Hoffman Enterprises Ltd.
Partnership, supra, 157 Conn. App. 169. ‘‘[A] party’s
failure to comply with the notice provision in a termina-
tion clause . . . amounts to a material breach of the
contract.’’ Id., 172.
Here, the trial court concluded that Skanska ‘‘violated
the contract terms when it responded to Semac’s moves
by declaring that it was terminating Semac for cause’’
without affording Semac forty-eight hours to cure its
default under the contract. The court noted that Skan-
ska’s rush to terminate Semac was likely ‘‘motivated
by the contract clause that allowed Skanska to seize
Semac’s equipment following a for-cause termination.’’
The court reasoned: ‘‘Under the contract, Skanska had
the right to terminate Semac anytime it wanted with
cause or without. But for Skanska to terminate Semac
for cause as it said it was and grab Semac’s equipment,
the contract provides that it had to give Semac forty-
eight hours to cure its breach and get back on the job.
The contract doesn’t name any exception or qualify this
rule in any way. It doesn’t say that the provision doesn’t
apply when the other party breaches first. It doesn’t
say it doesn’t apply when the other party isn’t likely
to make use of the forty-eight hour period to cure.
Elsewhere in the contract it does say that Skanska may
seek any other remedies available at law outside the
contract, but it doesn’t say anything about rewriting
explicit provisions already contained in the contract to
make them easier on Skanska. So the forty-eight hour
notice that was not given had to be given for Skanska
to terminate Semac for cause.
‘‘In pressing a strict application of the contract, Skan-
ska must suffer the consequences of its own handiwork.
We will never know what might have happened during
that forty-eight hour period. Semac was facing ruin by
continuing on the same terms, so absent some change
it almost certainly would have left. But maybe Miller’s
call for negotiations would have prevailed after every-
one cooled down, and some sort of compromise might
have been reached. It would have been tough, but the
notice period might have achieved something. What is
clear is that by giving no warning of its intention to
terminate Semac, Skanska didn’t give the required forty-
eight hours’ notice required by its contract.’’
On the basis of the foregoing, and relying on this
court’s decision in Coppola Construction Co. v. Hoff-
man Enterprises Ltd. Partnership, supra, 157 Conn.
App. 169, in which we held that failing to give a required
termination notice at the required time is a material
contract breach, the court concluded that both Semac
and Skanska materially breached the contract.
In challenging the trial court’s determination that it
breached its contract with Semac, Skanska does not
dispute that it did not afford Semac forty-eight hours
to cure its default. Skanska argues, however, that, for
several reasons, Semac was not entitled to that cure
period. Skanska first claims that the court erred in
assuming that it terminated Semac pursuant to § 12.1
of the contract, the provision that required it to give
Semac forty-eight hours to cure its breach. Because
Skanska actually pleaded in its counterclaim that it had
‘‘declared Semac in default . . . pursuant to exhibit E,
article 12 of the subcontract,’’ the court properly held
the parties to their obligations under that section of the
contract. Moreover, Skanska’s reliance on § 12.1 can
be inferred from its communications to Semac follow-
ing its receipt of the Notice of Cardinal Change wherein
it threatened to exercise its rights under the contract
if Semac did not rescind its repudiation of the contract,
specifically its right to seize all of Semac’s tools and
equipment, a right afforded under § 12.1.
Skanska also argues that Semac’s material breach
and repudiation of the contract and its abandonment
of the project absolved Skanska of its obligation to
afford Semac a forty-eight hour cure period. In support
of this claim, Skanska argues for the application of
multiple common-law principles that are often applica-
ble to contract disputes, namely, the principles of first
breach, repudiation, anticipatory breach, and waiver.
Skanska’s argument for the application of these princi-
ples overlooks the clear language of § 12.1 of the con-
tract that outlined the procedure to be followed if
Semac abandoned the project or otherwise defaulted
on its contractual obligations. Section 12.1 explicitly
and comprehensively sets forth the parties’ rights and
responsibilities in the event Semac was terminated for
its abandonment of the project, the very basis for Skan-
ska’s termination. We agree with the trial court’s deter-
mination that Skanska should be held to the words of
the contract, just as Semac had been, and was thus not
excused from affording Semac a forty-eight hour cure
period. To hold otherwise would excuse Skanska’s non-
compliance with a contractual requirement, and ‘‘would
create a new and different agreement, which courts
cannot do.’’ Coppola Construction Co. v. Hoffman
Enterprises Ltd. Partnership, supra, 157 Conn. App.
171, citing Collins v. Sears, Roebuck & Co., 164 Conn.
369, 374, 321 A.2d 444 (1973) (in construing contract,
court cannot disregard words used by parties or revise,
add to, or create new agreement).
Skanska also claims that, ‘‘[i]n light of Semac’s con-
duct, verbal, and written statements from October 19,
2015 through October 22, 2015, it is uncontroverted that
Semac would not perform under the subcontract and
that waiting an additional [twenty-four] hours for a rec-
onciliation that was not coming would have been futile.’’
Skanska argues that Semac told it ‘‘in at least six differ-
ent ways that it would be leaving’’ the project, and thus
affording Semac an additional twenty-four hours to cure
its breach would have been futile. As noted, the contract
expressly provided that Semac was afforded a forty-
eight hour cure period, and did not provide for any
exceptions or qualifications to that requirement. Addi-
tionally, we agree with the trial court that it cannot
be known for certain, despite Semac’s repeated and
unwavering representations that it would not continue
to work on the project unless Skanska met its monetary
demands, what the parties may have worked out. The
trial court found that ‘‘[w]e will never know what might
have happened during that forty-eight hour period.’’ We
decline to speculate that waiting the additional hours
required under the contract would have been futile.
Skanska finally contends that the trial court’s
enforcement of § 12.1 of the contract, and its rejection
of Skanska’s assertion of various common-law doc-
trines to defend its failure to abide by the express con-
tract language of § 12.1 requiring the forty-eight hour
cure period rendered meaningless § 19.5 of the contract,
which provided that the remedies outlined in the con-
tract were not the exclusive remedies available to Skan-
ska. Although § 19.5 provides that the remedies set forth
under the contract are not the exclusive remedies of
the parties, we do not agree with Skanska’s contention
that it can turn to the common law to avoid an obligation
contained expressly in the contract.
In sum, we agree with the trial court’s conclusion
that, just as Semac was bound by the express language
of the contract that contemplated the potential of delays
and changes of sequencing, Skanska is bound by the
language of the contract that expressly set forth the
procedure that Skanska was required to follow if Skan-
ska wanted to terminate Semac for abandonment of
the project. Skanska cannot use the common law to
excuse it from abiding by the language of the contract
that it drafted. As the trial court noted, the contract
very heavily favored Skanska, and Skanska failed to
afford Semac one of the few protections afforded to
Semac under the contract. In so doing, the trial court
properly found that Skanska breached the contract.6
III
Both parties also challenge the court’s award of dam-
ages to Skanska in the amount of $3,857,130.77.7 ‘‘It is
axiomatic that the sum of damages awarded as compen-
sation in a breach of contract action should place the
injured party in the same position as he would have
been in had the contract been performed. . . . The
injured party, however, is entitled to retain nothing in
excess of that sum which compensates him for the
loss of his bargain. . . . Guarding against excessive
compensation, the law of contract damages limits the
injured party to damages based on his actual loss caused
by the breach. . . . The concept of actual loss accounts
for the possibility that the breach itself may result in
a saving of some cost that the injured party would
have incurred if he had had to perform. . . . In such
circumstances, the amount of the cost saved will be
credited in favor of the wrongdoer . . . that is, sub-
tracted from the loss . . . caused by the breach in cal-
culating [the injured party’s] damages. . . . The plain-
tiff has the burden of proving the extent of the damages
suffered.’’ (Citation omitted; internal quotation marks
omitted.) Coppola Construction Co. v. Hoffman Enter-
prises Ltd. Partnership, supra, 157 Conn. App. 162.
‘‘[W]e review [a] trial court’s damages award under
the clearly erroneous standard, under which we over-
turn a finding of fact when there is no evidence in the
record to support it . . . or when although there is
evidence to support it, the reviewing court on the entire
evidence is left with the definite and firm conviction
that a mistake has been committed.’’ (Internal quotation
marks omitted.) Id., 176.
With the previously cited principles in mind, we begin
by reviewing the factual and legal bases underlying the
trial court’s award of damages. The court noted that
‘‘Semac said it was due around $3.6 million for work
completed to date when it left the job and wants an
order for this money among other things. Skanska’s
counterclaim seeks some $26 million, almost all of it
for the cost of completing the work using replacement
subcontractors. Because they both assume a breach of
contract only by their adversary, both parties’ claims
for damages are wrong.’’
The court reasoned: ‘‘[B]oth parties here breached.
Semac can’t fairly claim expectation damages as its
reward for temporarily or permanently abandoning the
contract. . . . Skanska, by contrast, had the right to
terminate Semac for convenience without any grace
period at all. . . . Indeed, the Skanska contract says
that an erroneous termination for cause converts auto-
matically to a termination for convenience. That con-
tract also says termination for convenience means
Skanska must pay—not expectation damages—but the
money due for the work performed to date. That money
is the right measure here, but as we will see, it doesn’t
matter. The damages would be the same as expecta-
tion damages.
‘‘In calculating what was due [to] Semac for work up
to the date of its departure, Semac points out that it
had several bills to Skanska outstanding when it left
the job. It claims [that] Skanska’s breach means it had
the right to stop work and, more important, Skanska
had commanded it to cease performing. The latter fact
certainly means Semac didn’t have to complete the job
under the contract terms. After all, Skanska can’t have
it both ways. Given that the contract terms mean that
Skanska terminated Semac for its own convenience,
Skanska can’t contradictorily claim that Semac should
have kept working or pay for the cost of replacement
subcontractors. It might have been different with a
proper termination for cause based on Semac temporar-
ily or permanently abandoning the job, but that’s not
what the contract says happened here.
‘‘So Semac didn’t need to complete the job, isn’t liable
for the costs of replacement subcontractors, and is due
the money that was owed to it at the time it left.’’ In so
finding, the court determined that Semac was entitled
to a termination payment under § 12.4 of its contract
with Skanska. The court nevertheless concluded that
Semac ‘‘wasn’t due any money at the time it left and
actually had money the contract required it to return
to Skanska.’’
To determine the amount of the termination payment
to which Semac was entitled, the trial court found that
it could not simply rely upon the amounts billed by
Semac due to its billing ‘‘irregularities and its incentive
to inflate its bills . . . .’’ The court thus determined
that the best way to determine the amount to which
Semac was entitled was to ascertain the percentage of
the entire contract that Semac had fulfilled and multiply
that percentage by the total amount of the contract.
Both parties presented testimony as to their respective
views as to the percentage of the job that had been
completed when Semac was terminated, but the court
found that the most persuasive testimony in this regard
was offered by Miller, Skanska’s project manager, who
opined that Semac had completed 65 percent of the
job. The court adopted Miller’s position and calculated
that Semac was entitled to $12,424,447, which was 65
percent of the revised contract price of $19,114,535.
Because Semac had already billed and been paid
$14,785,764.36 from Skanska, Semac had received
$2,361,317.36 more than it should have for the work
that it had completed. To that amount, the trial court
added funds that Semac had collected from Skanska
for overpayments to two of Semac’s subcontractors and
overpayment for labor rates on which Semac improp-
erly had added a profit, for a total additional amount
of $1,495,813.41. The court thus concluded that Semac
owed Skanska a total of $3,857,130.77.8
On appeal, Skanska argues that, ‘‘[d]ue to Semac’s
material breach, Skanska was excused from further
performance of its obligations under the contract, and
was entitled to expectation damages.’’ Skanska claims,
‘‘as a result of the trial court’s incorrect determination
that Skanska also breached the subcontract, it improp-
erly failed to award its expectation damages.’’ Because
we disagree with Skanska’s argument that it did not
breach the contract, as discussed herein, we also reject
its claim that it was entitled to expectation damages.
Skanska also claims that it is entitled to expectation
damages under the common law because § 19.5 pro-
vided that its contractual remedies were not its exclu-
sive remedies. We disagree. As stated previously, § 12.1
of the contract explicitly provided for the procedure to
be followed by Skanska in the event of a breach by
Semac. Skanska failed to abide by the express require-
ment that it afford Semac a forty-eight hour cure period
and, thus, also breached the contract, and its termina-
tion for cause of Semac was transformed into a termina-
tion for convenience. Skanska cannot now claim entitle-
ment to a common-law remedy after it forfeited its right
to a contractual remedy as a result of its own breach.
Semac argues that the court erred in not awarding
it a termination payment under § 12.4 of the contract,
which was triggered when Skanska failed to afford
Semac a forty-eight hour cure period, transforming the
termination for cause into a termination for conve-
nience. Semac’s challenge in this regard is misplaced
in that the trial court expressly did conclude that Semac
was entitled to the termination payment when it con-
cluded that Semac ‘‘didn’t need to complete the job,
isn’t liable for the costs of replacement subcontractors,
and is due the money that was owed to it at the time
it left.’’ The court further found, however, that Semac’s
billing practices were too irregular to confidently award
damages based upon Semac’s invoices, as contemplated
by § 12.4 of the contract, which provided that the termi-
nation payment ‘‘shall be comprised of: (i) amounts
invoiced and due for [w]ork performed but not yet paid;
(ii) payment for [w]ork satisfactorily completed but not
yet invoiced by [Semac] prior to the termination; (iii)
retainage held by [Skanska] at the date of termination;
and (iv) all reasonable, actual termination costs
incurred by [Semac] in terminating the [w]ork . . . .’’
The court therefore employed an alternative method
of calculating the termination payment by determining
the percentage of the project that Semac had completed
and multiplying that percentage by the total contract
price. Although potentially somewhat imprecise, it can-
not reasonably be argued that this method of calculating
the termination payment ran afoul of § 12.4 of the con-
tract, or that it was unfair to Semac. Indeed, it is consis-
tent with Semac’s claim that it be paid for the work
that it completed and its theory of quantum meruit.9 If
Semac had not front-loaded its invoices, ensuring that
it made a profit for every month that it billed Skanska,
it would not have been in the position of having its
termination payment credited by monies that it should
not have prematurely collected from Skanska. In light
of the foregoing, we conclude that the trial court’s
award of damages was not erroneous.
IV
Finally, Skanska claims that the trial court erred in
failing to find that Pope and Scanlon committed fraud
when they swore under oath to the accuracy of invoices
submitted to Skanska for a total of $1,022,064.44 for
goods and services that it represented it had paid, but
actually never did pay, to other subcontractors, Gexpro
and TPC Associates, Inc. We are not persuaded.
‘‘[I]t is well settled that the essential elements of fraud
are: (1) a false representation was made as a statement
of fact; (2) it was untrue and known to be untrue by
the party making it; (3) it was made to induce the other
party to act upon it; and (4) the other party did so act
upon that false representation to his injury. . . . All of
these ingredients must be found to exist. . . . Addi-
tionally, [t]he party asserting such a cause of action
must prove the existence of the first three of [the]
elements by a standard higher than the usual fair pre-
ponderance of the evidence, which . . . we have
described as clear and satisfactory or clear, precise and
unequivocal. . . . Finally, [t]he party claiming fraud
. . . has the burden of proof. . . . Whether that bur-
den has been met is a question of fact that will not
be overturned unless it is clearly erroneous.’’ (Internal
quotation marks omitted.) Trumbull v. Palmer, 123
Conn. App. 244, 257, 1 A.3d 1121, cert. denied, 299 Conn.
907, 10 A.3d 526 (2010).
‘‘A finding of fact is clearly erroneous when there is
no evidence in the record to support it . . . or when
although there is evidence to support it, the reviewing
court on the entire evidence is left with the definite
and firm conviction that a mistake has been committed.
. . . [A]s a reviewing court [w]e must defer to the trier
of fact’s assessment of the credibility of the witnesses
that is made on the basis of its firsthand observation
of their conduct, demeanor and attitude. . . . The
weight to be given to the evidence and to the credibility
of witnesses is solely within the determination of the
trier of fact. . . . In reviewing factual findings, [w]e do
not examine the record to determine whether the
[court] could have reached a conclusion other than the
one reached. . . . Instead, we make every reasonable
presumption . . . in favor of the trial court’s ruling.’’
(Internal quotation marks omitted.) McLeod v. A Better
Way Wholesale Autos, Inc., 177 Conn. App. 423, 450,
172 A.3d 802 (2017).
Here, in rejecting Skanska’s claim that Pope and
Scanlon engaged in fraudulent conduct, the trial court
reasoned: ‘‘The court had ample time to judge what
Scanlon and Pope said and how they said it. The court
can’t find they clearly and convincingly committed
fraud when they overcharged Skanska. Pope’s approach
to being [chief financial officer], as he explained it,
made some sense. His job was to sign for Semac after
other people at the company were presumed to have
vetted what he was to sign. He didn’t do their jobs for
them; he signed on behalf of his company in reliance
on what his company told him. Skanska may find it
unconvincing, but Pope’s rationale about the Gexpro
advanced billing of material isn’t clearly and convinc-
ingly fraudulent either. It was supported by documents
directly noting that material being charged for had not
yet been received. At a minimum, he seemed to have
sincerely and not heedlessly believed the advance bill-
ing was a reasonable practice and that is enough to
avoid culpability given the applicable standard.
‘‘Like Pope, Scanlon never bothered to read the entire
contract or the waivers being signed. But as we have
seen, it almost didn’t matter what they said anyway.
Semac had to agree or lose the contract to the next
bidder or, after signing the main contract, get no pay
for the work it did. Given the relative positions of the
parties, Semac had no choice, and the court does not
believe Skanska’s suggestions that it should assume it
would have agreed to material changes to the bargain if
asked. As commercial and consumer contracts become
increasingly intricate and the bargains increasingly
unbalanced, it is a sad truth that hardly anyone reads
them anymore while the courts and the lawyers keep
on reading them and the courts almost always enforce
them. This predictable form of neglect can’t form the
basis for fraud since in this context Scanlon’s neglect
was more pragmatic than reckless. This and some of
his arguably inconsistent and inadequate efforts may
have put his company on the hook for breach of con-
tract, but they don’t support a finding that Scanlon
committed fraud.
‘‘Fraud is something beyond Semac stretching things
concerning the materials and the money it withheld for
instance from subcontractor TPC. About TPC, Semac
interpreted things in the light most favorable to itself,
including its view that because the payments weren’t
due to TPC, in its view it is protected by the language
in the waivers about having paid all money ‘due’ to
subcontractors. But this doesn’t amount to a lie or reck-
less misstatement or, at least in light of the court’s
credibility judgments there isn’t clear and convincing
evidence of intent or recklessness: merely strained and
self-interested interpretations. None of them amount to
good reasons to impose massive financial liabilities on
Scanlon or Pope.’’
On appeal, Skanska argues that the record clearly
showed that Pope and Scanlon acted fraudulently by
not reading or verifying the accuracy of the content of
the invoices to which they swore under oath. To be
sure, that conduct, even as described by the trial court,
strains the bounds of fraud, and reveals, at best, gross
incompetence displayed by Pope and Scanlon. The trial
court nevertheless found that, based upon its observa-
tion of the demeanor and attitude of Pope and Scanlon,
neither of them acted with fraudulent intent. Because
we cannot second-guess the trial court’s credibility
assessments, its rejection of Skanska’s fraud claim
must stand.
The judgment is affirmed.
In this opinion the other judges concurred.
1
The court also awarded prejudgment interest in the amount of
$405,259.79, for a total due to Skanska of $4,262,390.56. Neither party has
challenged the court’s award of prejudgment interest.
2
Skanska also alleged defamation and tortious interference, but those
claims were dismissed for lack of subject matter jurisdiction.
3
Prior to trial, the parties stipulated to the fact that Skanska spent
$28,754,711.81 for other subcontractors and suppliers to complete Semac’s
subcontract scope of work.
4
In its brief to this court, Semac claims: ‘‘The gravamen of this lawsuit
. . . centers on whether the original $19.1 million construction contract,
which the trial court found to be 65 percent complete when Skanska wrong-
fully terminated Semac, but which cost an additional $28.7 million to finish
after Semac left, is a fundamentally different contract than the one Semac
agreed to perform. In the original contract Semac bargained for about 119,000
hours of work, but by the time the contract was complete, the nature of
the work and conditions of performance had changed so dramatically that
the total labor hours required for completion of the electrical work exceeded
430,000.’’ (Emphasis in original.) Semac argues that the trial court erred in
rejecting its claim of cardinal change because it had ‘‘agreed to perform
electrical work for Skanska for $19.1 million, [but c]hanges to Semac’s
working conditions . . . increased the total cost of the electrical work to
$45.6 million, [and] thus constituted a cardinal change as a matter of law.’’
Semac contends: ‘‘The $45.6 million contract Skanska demanded was simply
not the $19.1 million electrical contract for which Semac bargained.’’
As explained herein, and conceded by counsel, this argument is not factu-
ally accurate. The cardinal change upon which Semac relied on October 22,
2015, did not, and, obviously, could not have contemplated the amount of
money and hours that Skanska would be required to expend to complete
the electrical work on the project several months after Semac refused to
continue to its work on the project. Indeed, much of the additional cost is
attributable to the fact that the substitute electrical contractors presented
exorbitant bills that Skanska had to pay in order to finish the project on time.
5
Although not necessarily relevant to our review of the trial court’s rejec-
tion of Semac’s claim of cardinal change, we note the likely validity of
the court’s speculation of Semac’s true reason for abandoning the project:
because it had front-loaded its billing, it realized that it was running out of
funds in the fixed price contract against which it could bill Skanska.
6
Semac asserts that Skanska’s failure to allow it the full forty-eight hours
to cure had the legal effect of maintaining Semac’s conduct in the status
of a default and not a breach. We do not agree. While Skanska’s failure to
afford the required cure period breached the contract, it in no way exoner-
ated Semac for its own material breach.
7
This amount does not include the court’s award of prejudgment interest.
8
Semac subsequently moved for reconsideration of the amount of dam-
ages based on an alleged miscalculation of certain of the credits applied to
the termination payment. The court granted reargument, but affirmed its
decision. This is not relevant to the claims on appeal.
9
Semac claims in its brief to this court that it was entitled to a termination
payment under § 12.4 of the contract in the amount of $2,108,290.87. As
Semac explains, this is the same amount that it would be entitled to under
a theory of quantum meruit for the value of the work that it had completed.
This is the very basis upon which the court calculated its award of damages.