Opinion
January 31, 1967. —
February 28, 1967.
APPEAL from a judgment of the circuit court for Dane county: EDWIN M. WILKIE, Circuit Judge. Affirmed.
For the appellants there was a brief by Jasper, Winner, Perina Rouse of Madison, attorneys, and Carlsen, Greiner Law of Minneapolis, Minnesota, of counsel, and oral argument by John D. Winner and Wellington H. Law.
For the respondent the cause was argued by Richard E. Barrett, assistant attorney general, with whom on the brief were Bronson C. La Follette, attorney general, and E. Gordon Young, assistant attorney general.
This action was brought by the Walter D. Giertsen Company and the S. J. Groves Company against the state of Wisconsin to recover flood damages allegedly caused by a breach of an implied warranty of the contract between the appellants and the state.
The Walter D. Giertsen Company specializes in building bridges, and the S. J. Groves Company specializes in road and bridge paving and topping. They are together here in a joint venture. The action arises out of a plan proposed by the state of Wisconsin to construct twin bridges as a part of Interstate Highways 90 and 94 over the Wisconsin river at the town of Dekorra in Columbia county.
In preparation for bidding as the principal contractor, Mr. Raymond Kirkman, vice-president of Giertsen, carried out an investigation of the project. As a result of his investigation, Mr. Kirkman concluded that the bridges should be constructed by a dike and well-point system, which contemplates the establishment of dikes in the river, the insertion of well points into the bed of the river, and pumping the work area dry. The dike and well-point system is to be distinguished from a steel cofferdam and seal method. The latter method operates by building a steel cofferdam into the river, pouring a concrete seal into the bottom of the cofferdam, and pumping out the water. The well-point and dike system is more vulnerable to flooding.
The contract entered into between the appellants and the state contained the following provision:
"The bidder declares that he has carefully examined the site of, and the proposal, plans, specifications and contract forms for, the work contemplated, and it is assumed that the bidder has investigated and is satisfied as to the conditions to be encountered, as to the character, quality, and quantities of work to be performed and materials to be furnished, and as to the requirements of the specifications, special provisions and contract. It is mutually agreed that submission of a proposal shall be considered conclusive evidence that the bidder has made such examination."
About two years before the matter was let out for bid, the state requested the United States geological survey to make a study of the river and river sites. The final study, introduced as Exhibit 119, included flood frequency magnitudes of the Wisconsin river. This study was not disclosed to the plaintiffs prior to the bidding or during construction.
In July, 1959, the contractors commenced work on the job. They had completed one dike and had started working on a second dike when a flooding occurred on September 30, 1959. After cleaning up the area, they continued construction under the dike and well-point system. Shortly thereafter, in October, the construction was again flooded out.
The high-water elevation recorded during the floods was 778 feet, and the height of the island upon which the contractors based their dikes was 779 feet. However, the floods overtopped the dikes because of the velocity of the stream.
This claim arises from damages caused by these two floods. The parties agreed to reserve the computation of the damages for a later determination. The sole issue tried below was the issue of liability.
The trial court entered a judgment dismissing the complaint.
The plaintiffs are contractors who had agreed with the state to build certain bridges which, during construction, were flooded by high water. The damages resulting from that flooding are the subject of this lawsuit. The trial court found that the state withheld material information from the appellants; we must determine whether this fact entitles the plaintiffs to recover in this action.
At the time that bids were being prepared, the contractors conducted their own investigation as to the circumstances involved at the site where the bridges were to be built. Notwithstanding their investigation, the plaintiffs contend that they would have used different techniques if they had had the information which the state of Wisconsin possessed.
There was an express contractual obligation on the part of the bidding contractors to make an investigation. They did not learn of the report of the United States geological survey until after the flooding had taken place. The federal agency's. report contained predictions as to the frequency of floods on the river and indicated that there was a 50 percent chance in any given year that the river would reach an elevation of 778 feet. As a matter of fact, there was testimony indicating that such high-water mark was reached in 1950 and not again until September, 1959, when the unfinished construction work performed by the plaintiffs was flooded.
We believe that the contract entered into between the parties was an arm's length one; it required the contractors to make their own study as to the "conditions to be encountered." We believe that the risk of high water was one of the precise hazards that the parties had in mind when they formally imposed an investigative duty upon the builders. The written agreement expressly provided that "it is mutually agreed that submission of a proposal shall be considered conclusive evidence that the bidder has made such examination." In light of this clause, it is difficult to accept the appellants' present claim that the damages suffered by the flooding should be borne by the state of Wisconsin.
We distinguish those cases wherein the builder claimed to have been misled by affirmative false statements on the part of the agency. Thomsen-Abbott Construction Co. v. Wausau (1960), 9 Wis.2d 225, 100 N.W.2d 921; Wussow v. State (1936), 222 Wis. 118, 267 N.W. 56; McDonald v. State (1931), 203 Wis. 649, 235 N.W. 1; Furton v. City of Menasha (D.C. Wis. 1947), 71 F. Supp. 568.
We also distinguish those cases in which concrete facts known to the governmental agency are not disclosed by it to the contractor. An example of this is the situation in which the governmental agency has information relating to subsoil conditions at the situs. Walla Walla Port Dist. v. Palmberg (9th Cir. 1960), 280 F.2d 237; Eastover Stores, Inc., v. Minnix (1959), 219 Md. 658, 150 A.2d 884; Valentini v. City of Adrian (1956), 347 Mich. 530, 79 N.W.2d 885.
In the case at bar, there were no affirmative misrepresentations by the state, and in addition the nondisclosure related only to estimates and predictions, as opposed to firm facts. The chief bridge engineer for the state testified that the information contained in the United States geological survey report was not transmitted because, in his opinion, it was not reliable. The trial court did not ascribe malice or any improper motive to the state's nondisclosure which related to a prognostication as to flooding rather than an assertion as to an incontestable fact.
Upon the facts of this case, there is no valid reason to surcharge the defendant with the responsibility for the very risk which the appellants had undertaken by an express contractual commitment. If there had been affirmative misrepresentations by the state or if the nondisclosures were the result of malice or if they related to factual matters as opposed to mere predictions, we might be persuaded to view this matter differently. Dealing, however, only with the facts as presented in the case at bar, we conclude that the plaintiffs' complaint was properly dismissed.
In the findings of fact, the learned trial court stated, at finding No. 2, that the report "contained reference to flood frequencies and elevations of the Wisconsin River at the construction site which was not reasonably obtainable through an investigation at the site nor from an investigation through normal channels." However, in its conclusions of law the court entered the following, which tends to contradict the finding quoted immediately above:
"2. That since a proper examination of the bridge site by the plaintiffs would have led to a disclosure of of the essential facts, including the superior knowledge of the state, and since such failure on the part of the plaintiffs is a breach of its duty."
We believe that any inconsistency between the quoted finding of fact and the quoted conclusion of law must be resolved by heeding the judgment which the trial court directed to be entered. In Morgan v. Richter (1919), 170 Wis. 111, 174 N.W. 712, the amount to be paid to the plaintiff was stated differently in the findings of fact and in the judgment. This court noted the divergence and stated, at page 114, ". . . we must presume that the judgment is right." In the case at bar, the trial court ordered that judgment be entered dismissing the complaint, and we resolve any inconsistency by determining that the plaintiffs would have learned all the essential facts if they had made a thorough scrutiny of the circumstances at the bridge site.
By the Court. — Judgment affirmed.
WILKIE, J., took no part.