Falls Sales Co. v. Board of Transportation

233 S.E.2d 569 (1977) 292 N.C. 437

FALLS SALES COMPANY, INC., Plaintiff,
v.
BOARD OF TRANSPORTATION, Defendant,
v.
ASHEVILLE CONTRACTING COMPANY, Third-Party Defendant.

No. 47.

Supreme Court of North Carolina.

April 14, 1977.

Atty. Gen. Rufus L. Edmisten by Sr. Deputy Atty. Gen. R. Bruce White, Jr., and Asst. Atty. Gen. Guy A. Hamlin, Raleigh, for Bd. of Transp.

Adams, Hendon & Carson, P. A., by George Ward Hendon, Asheville, for third-party defendant.

COPELAND, Justice.

Asheville first contends the Court of Appeals erred in affirming the trial court's denial of its motions to dismiss, for summary judgment, and for a directed verdict. Asheville claims its various motions should have been allowed because neither the plaintiff nor the defendant Board of Transportation have ever alleged or proven that Asheville performed its work in a negligent manner or in any manner inconsistent with prevailing good practices in the construction industry.

It is a well settled rule in this jurisdiction that a contractor who is employed by the Board of Transportation to do work incidental to the construction or maintenance of a public highway and who performs the work with proper care and skill cannot be held liable to a property owner for damages resulting to property from the performance of the work. In such a case, the injury to the property constitutes a taking of the property for public use for highway purposes. Highway Commission v. Reynolds Co., 272 N.C. 618, 159 S.E.2d 198 (1968); Insurance Co. v. Blythe Brothers Co., 260 N.C. 69, 131 S.E.2d 900 (1963); Moore v. Clark, 235 N.C. 364, 70 S.E.2d 182 (1952). The only remedies available to the owner are a special condemnation proceeding against the Board of Transportation under G.S. 136-19 or an action for "inverse condemnation" against the Board to recover compensation for the property taken or damaged. Reynolds, supra; Insurance Co., supra. But if the contractor employed by the Board of Transportation performs his work in a negligent manner and thereby proximately injures the property of another, he is personally liable to the owner therefor. Reynolds, supra; Insurance Co., supra; Moore, supra.

We do not believe these established rules bar the third-party action involved in the instant case. While nothing else appearing, the contractor employed by the Board of Transportation is not absolutely liable for damages to a property owner, we have never held that a contractor may not contract to assume this liability. In Reynolds, supra, an action brought by the Highway Commission against a contractor to recover compensation paid to the owner of a building damaged by the contractor in the construction of a highway for the plaintiff, this Court had occasion to construe § 7.14 of the standard specifications, the general damage responsibility clause of the contract. In that case, we held that the parties did not contemplate or intend that the contractor should reimburse the Highway Commission for any amount paid by the Commission in discharge of its own primary liability and that reimbursement was contemplated and intended only in instances in which the Commission was called upon to discharge a liability to which it was subject on account of some wrongful act of the contractor and for which the contractor was primarily liable. Reynolds, supra.

Reynolds is distinguishable in several respects from the case at bar. First, the trial court found as fact in Reynolds that the damages to the building did not result from blasting operations but were the result of the use of standard and accepted machinery and road-building equipment according to standard and accepted methods and techniques in the road construction industry. The contractor in Reynolds, supra, thus did not appear to be engaged in an ultrahazardous activity. We have held that blasting is an inherently dangerous or extrahazardous activity and that persons using explosives are strictly liable for damages proximately caused by an explosion. Insurance Co., supra. Thus, when a contractor employed by the Board of Transportation uses explosives in the performance of his work we believe that he is primarily and strictly liable for any damages proximately resulting therefrom. See Insurance Co., supra.

Fifty years ago, the Fourth Circuit Court of Appeals found Asheville Construction Co. (possibly a predecessor of the third-party defendant in this case?), an independent contractor, strictly liable on the theory of trespass for damages caused by rock and debris thrown on the property of another as a result of blasting operations. Asheville Construction Co. v. Southern Ry. Co., 4 Cir., 19 F.2d 32 (1927) (Parker, J.). That court held the fact that the contractor was employed by an agency of the State to construct the highway did not entitle it to any immunity from liability. Asheville Construction Co., supra.

Assuming arguendo that the contractor is not primarily and strictly liable to the property owner for damages resulting from blasting, Reynolds is nevertheless distinguishable because of § 7.11 of the standard specifications. That specific liability clause of the contract states explicitly and without qualification that "[t]he contractor shall be responsible for any and all damage resulting from the use of explosives." The Board of Transportation, which is liable for any "taking" of property through the use of explosives by its contractors, Insurance Co., supra, has the right to enter into an indemnity contract with the contractor. Clearly the Board of Transportation by the insertion of § 7.11 into the contract specifications intended to insure itself against the highly unpredictable and dangerous consequences of blasting. "Ordinarily, when parties are on equal footing, competent to contract, enter into an agreement on a lawful subject, and do so fairly and honorably, the law does not permit inquiry as to whether the contract was good or bad, whether it was wise or foolish." Roberson v. Williams, 240 N.C. 696, 700-1, 83 S.E.2d 811, 814 (1954). "It is the simple law of contracts that ``as a man consents to bind himself, so shall he be bound.'" (Cases omitted.) Troitino v. Goodman, 225 N.C. 406, 414, 35 S.E.2d 277, 283 (1945).

We conclude that allegation and proof of negligence by the Board of Transportation in its action against Asheville is unnecessary and Asheville's motions to dismiss, for summary judgment, and for a directed verdict were properly denied.

Asheville next assigns as error the trial court's allowance of the Board's motion for a directed verdict. This issue is not properly before us. Asheville did not present and discuss the assignment in its brief before the Court of Appeals as required by Rule 28(a) of the North Carolina Rules of Appellate Procedure. Accordingly, under Rule 28(a) the assignment was "deemed abandoned" and that court did not consider the question. After there has been a determination by the Court of Appeals, review by this Court, whether by appeal of right or by discretionary review, is to determine whether there is any error of law in the decision of the Court of Appeals and only the decision of that court is before us for review. State v. Colson, 274 N.C. 295, 163 S.E.2d 376 (1968); State v. Williams, 274 N.C. 328, 163 S.E.2d 353 (1968); Rule 16(a), N.C. Rules of Appellate Procedure. We inquire into the proceedings in the trial court solely to determine the correctness of the decision of the Court of Appeals except in those instances in which we elect to exercise our general supervisory power over inferior courts. State v. Williams, supra. A party who was an appellant in the Court of Appeals is only entitled to present in his brief before this Court assignments of error which he properly presented for review to the Court of Appeals. Rule 16(a), N.C. Rules of Appellate Procedure; accord, State v. Colson, supra. The potential scope of our review is limited by the questions properly presented for first review in the Court of Appeals. State v. Colson, supra ; Drafting Committee Note to Rule 16(a). "The attempt to smuggle in new questions is not approved." State v. Colson, supra, 274 N.C. at 309, 163 S.E.2d at 386.

Nevertheless, we note that the directed verdict was proper because the only issue to be determined was a question of law based on admitted facts. Cutts v. Casey, 278 N.C. 390, 180 S.E.2d 297 (1971). Both parties admit their written contract. We find § 7.11 of the standard specifications is free from ambiguity and when a written contract is free from ambiguity, interpretation of the contract is for the court. Briggs v. Mills, Inc., 251 N.C. 642, 111 S.E.2d 841 (1960). Asheville's contention that there were other issues of fact related to its affirmative defenses which should have been submitted to the jury is without merit.

On this appeal neither the Board nor Asheville challenges Judge Walker's order severing the third-party action from the principal action and requiring the third-party action to be tried first. However, in view of the posture in which this action will return to the superior court, we are constrained to make the following observations:

A severance order is an interlocutory order, that is, one incidental to the progress of the cause which does not affect a substantial right of the parties. As such, it may be subsequently modified by the presiding judge upon a determination that present circumstances warrant such action. "Interlocutory orders are subject to change ``at any time to meet the justice and equity of the case upon sufficient grounds shown for the same.'" Calloway v. Ford Motor Co., 281 N.C. 496, 502, 189 S.E.2d 484, 488 (1972).

The decision in this opinion, that Asheville is absolutely liable to the Board for all sums recovered by the plaintiff from the Board for blasting damages, settles one of the major issues in the case. Thus from now on Asheville's interests will be inextricably bound with those of the Board.

The provision for consolidated trials contained in G.S. 1A-1, Rule 14(a) was designed to deal with this type of situation. "When the rights of all three parties center upon a common factual setting, economies of time and expense can be achieved by combining the suits into one action. Doing so eliminates duplication in the presentation of evidence and increases the likelihood that consistent results will be reached when multiple claims turn upon identical or similar proof." Wright & Miller, Federal Practice and Procedure § 1442 (1971). Even where circumstances require separate trials after a Rule 14 impleader, we believe the better practice is to try the principal action first.

The decision of the Court of Appeals is

AFFIRMED.