AI Generated Opinion Summaries

This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.

Facts

• The case involves a dispute between Villalobos Construction Company, Inc. (Plaintiff) and the New Mexico Department of Transportation (Defendant) over compensation for additional costs incurred by Plaintiff due to delays in a project. The delays, attributed to Defendant's errors and omissions, nearly doubled the project's completion time, leading to unforeseen expenses for traffic control devices borne by Plaintiff.

Procedural History

• [Not applicable or not found]

Parties' Submissions

• Plaintiff: Argued that the district court correctly awarded compensation for traffic control devices due to Defendant's errors and omissions, which significantly extended the project's duration and resulted in additional costs. Plaintiff contended that these damages were a natural consequence of Defendant's breach of contract and were objectively foreseeable at the time the contract was made. Plaintiff also invoked the doctrine of waiver by estoppel, claiming Defendant's actions led Plaintiff to believe it would be compensated for its work without strict adherence to contractual proof provisions (paras 2, 4).
• Defendant: Supported the appellate court's proposed reversal of the district court's judgment and order awarding costs to Plaintiff. Defendant argued in favor of enforcing the contract's terms, which required Plaintiff to document its costs using actual cost records and measure expenses according to generally accepted accounting principles (para 1).

Legal Issues

• Whether the district court erred in awarding Plaintiff compensation for traffic control devices without Plaintiff documenting its costs as required by the contract.
• Whether the doctrine of waiver by estoppel applies, allowing Plaintiff to bypass the contractual requirement for documenting costs.
• Whether the district court erred in finding Section 109.11 of the contract unconscionable and awarding costs to Plaintiff on that basis.

Disposition

• The appellate court reversed the district court's award of $78,763.02 for traffic control devices and $87,033.39 in costs in favor of Plaintiff.

Reasons

• KRISTINA BOGARDUS, Judge (JENNIFER L. ATTREP, Chief Judge, and GERALD E. BACA, Judge, concurring):
  The court found that the district court erred in awarding Plaintiff compensation for traffic control devices without adherence to the contract's documentation requirements. The contract explicitly required Plaintiff to document its costs using actual cost records and measure expenses according to generally accepted accounting principles. Plaintiff's failure to do so was not excused by general principles of contract law regarding damages flowing naturally from a breach (para 3).
  On the issue of waiver by estoppel, the court determined that Plaintiff did not establish the necessary elements for this doctrine to apply. Specifically, Plaintiff did not demonstrate that Defendant's conduct led Plaintiff to reasonably believe that the documentation requirements would be waived, nor did Plaintiff act in detrimental reliance on such a belief. The court also noted that estoppel is rarely applied against the state or governmental entities and found no exceptional circumstances justifying its application here (paras 4-6).
  Regarding the award of costs, the court concluded that Plaintiff did not respond to the proposed disposition that Section 109.11 of the contract was not unconscionable. The court emphasized that the parties had agreed to waive attorney fees and costs, limiting the recovery of costs despite a prevailing party's ability to recover costs under state law and rules. The lack of response from Plaintiff to these points was deemed a failure to demonstrate error in the proposed reversal (para 7).