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Paramount General Const. Co. v. Dept of Transportation (8/20/93), 857 P 2d 1191
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NOTICE: This opinion is subject to
formal correction before publication in the
Pacific Reporter. Readers are requested to
bring typographical or other formal errors to
the attention of the Clerk of the Appellate
Courts, 303 K Street, Anchorage, Alaska
99501, in order that corrections may be made
prior to permanent publication.
THE SUPREME COURT OF THE STATE OF ALASKA
DALE CALHOUN and JOYCE )
CALHOUN d/b/a/ PARAMOUNT ) Supreme Court No. S-5203
GENERAL CONSTRUCTION COMPANY, )
) Superior Court No.
Appellants, ) 4FA-91-1861 CIVIL
)
v. )
) O P I N I O N
STATE OF ALASKA, DEPARTMENT )
OF TRANSPORTATION AND PUBLIC ) [No. 3997, August 20, 1993]
FACILITIES, )
Appellee. )
______________________________)
Appeal from the Superior Court of the
State of Alaska, Fourth Judicial District,
Fairbanks,
Mary E. Greene, Judge.
Appearances: Dale Calhoun, Pro Se,
Fairbanks, for Appellants. Paul R. Lyle,
Assistant Attorney General, Fairbanks, and
Charles E. Cole, Attorney General, Juneau,
for Appellee.
Before: Moore, Chief Justice,
Rabinowitz, Burke, Matthews, and Compton,
Justices.
RABINOWITZ, Justice.
I. INTRODUCTION
Calhoun, a construction contractor, appeals from a
grant of summary judgment in favor of the State. The superior
court held that Calhoun's claims against the state were barred
under the doctrine of res judicata. We affirm.
II. FACTS AND PROCEEDINGS
In 1985, the Calhouns, d/b/a Paramount Construction,
("Calhoun") and the State of Alaska, Department of Transportation
and Public Facilities ("DOT&PF") entered into a contract for the
construction of a hangar and a generator in Coldfoot. The
contract contained a claims and dispute resolution provision.1
Throughout construction there were numerous disputes between
Calhoun, DOT&PF, the subcontractors and the designers. In April
1987, Calhoun submitted a claim for additional costs and other
charges, in the sum of $309,556.55, to DOT&PF's contracting
officer.
On July 30, 1987, Calhoun received a letter from his
surety, USF&G. The letter stated that the surety believed that
Calhoun's account was no longer viable and that it would limit
bonding of Calhoun to single jobs up to $100,000. After
receiving this letter, Calhoun initiated a series of
correspondence with DOT&PF. Calhoun claimed that the DOT&PF's
failure to pay Calhoun's additional costs resulted in his loss of
bonding and impaired his ability to conduct business.
In the course of the correspondence, Calhoun inquired
whether the contracting officer had authority to adjudicate the
bonding claim. After receiving clarification from Calhoun
concerning the claim, the contracting officer informed Calhoun
that "the claim regarding bonding problems [was] one which must
be ruled upon by the Contracting Officer." Calhoun indicated he
did not believe this claim could be handled by the claims
process, and thus never submitted the bonding claim to the
contracting officer for adjudication. In February 1988, the
contracting officer denied all of the claims Calhoun had
submitted in April 1987 except one $380 item.
In November 1988, Calhoun filed a complaint in the
superior court alleging, among other things: breach of contract;
new and different contract; unjust enrichment/quantum meruit; and
the surety bond loss claim.2 In September 1989, the superior
court dismissed Calhoun's 1988 complaint, holding that Calhoun
should have taken an administrative appeal from the contracting
officer's February 1988 decision rather than instituting an
independent superior court action.
In November 1989, Calhoun filed an administrative
appeal to the contracting officer's February 1988 decision. He
stated the following points on appeal: the administrative
officer's findings as to the absence of coercion were not
supported by the evidence; he was not afforded due process; the
administrative officer's decision was made without affording him
an opportunity to be heard or to cross-examine or to question
witnesses; and the administrative officer's decision was
erroneous because he was coerced by DOT&PF as to the manner in
which he performed the contract. Calhoun failed to raise as a
point on appeal, or to address, the loss of bonding claim. The
superior court, Judge Pengilly, affirmed the February 1988
findings and conclusions of the contracting officer. Calhoun
then appealed to this court. This first appeal was subsequently
dismissed due to Calhoun's failure to prosecute.
In October 1991, Calhoun filed the complaint which led
to this appeal. The complaint raised the following issues:
DOT&PF caused Calhoun to lose all of his bonding capabilities;
DOT&PF breached the Coldfoot contract; DOT&PF took unjust
advantage of Calhoun by means of coercion and intimidation; and
DOT&PF committed fraud/defamation. DOT&PF moved to dismiss the
1991 complaint pursuant to Civil Rules 12(b)(1) and 12(b)(6),
asserting that the claims alleged were barred by res judicata.
The superior court, Judge Greene, treated DOT&PF's motion as a
motion for summary judgment, which it granted. Calhoun now
appeals the superior court's grant of summary judgment and
consequent dismissal of his 1991 complaint.
III. DISCUSSION
A. Standard of Review
In reviewing a grant of summary judgment, we must deter
mine whether a genuine issue of material fact exists and, if not,
whether the moving party is entitled to judgment as a matter of
law. Zeman v. Lufthansa German Airlines, 699 P.2d 1274, 1280
(Alaska 1985).
B. Should Calhoun's 1991 Claims Have Been Barred by
Res Judicata?
We have set forth our position on res judicata in
DeNardo:
Under the doctrine of res judicata,
a judgment on the merits of the controversy
bars subsequent actions between the same
parties upon the same claim. The doctrine
implements "the generally recognized public
policy that there must be some end to
litigation and that when one appears in court
to present his case, is fully heard, and the
contested issue is decided against him, he
may not later renew the litigation in another
court." It is settled that res judicata
precludes relitigation by the same parties,
not only of claims raised in the first
proceeding, but also of those relevant claims
that could have been raised. The claims
extinguished by the first judgment include
"all rights of the plaintiff to remedies
against the defendant with respect to all or
any part of the transaction . . . out of
which the action arose,"a mere change in the
legal theory asserted as a ground for
recovery will not avoid the preclusive effect
of the judgment.
DeNardo v. State, 740 P.2d 453, 455-56 (Alaska 1987), appeal
dismissed, cert. denied, 484 U.S. 919 (1987) (citations omitted).3
DOT&PF contends that each of the four separate claims
at issue in this appeal are barred. More particularly, DOT&PF
argues that the requirements of res judicata are met in this
instance. First, the superior court rendered a final judgment in
1989 on the merits of Calhoun's administrative appeal. Secondly,
the parties to the 1988 superior court complaint, the 1989
administrative appeal to the superior court, the 1991 appeal to
this court, the 1991 superior court complaint, and the instant
appeal are all the same. Thirdly, the claims alleged in the 1991
superior court complaint arise out of the same transaction,
namely the Coldfoot Hangar construction contract, as did the 1988
superior court complaint claims. Finally, the claims alleged in
the 1991 complaint were raised or could have been raised in the
1989 administrative appeal.
Our review of the record persuades us that DOT&PF's
contentions are correct, that the elements of res judicata are
satisfied, and that the superior court appropriately applied res
judicata to bar each of the claims now in question.4
1. Breach of Contract Claim
Calhoun's 1988 superior court complaint contained a
breach of contract claim, which he did not pursue in his 1989
administrative appeal to the superior court from the contracting
officer's 1988 decision. Given the foregoing, the superior court
ruled that the contract claim alleged in Calhoun's 1991 superior
court complaint was barred by operation of the principles of res
judicata because Calhoun did not preserve it in his 1989
administrative appeal.5
We find no error in the superior court's ruling that
res judicata bars this 1991 breach of contract claim.
2. The Coercion Claim
The first point in Calhoun's 1989 administrative appeal
was that there was no support in the evidence for the
administrative officer's findings as to the absence of coercion.
The fourth point in that appeal argued that the administrative
officer's decision that Calhoun had failed to comply with certain
of the contract provisions was in error. Calhoun claimed that he
was coerced by the DOT&PF as to the manner in which he both
performed the contract and brought disputes before the agency
under the contract.
In deciding the 1989 administrative appeal Judge
Pengilly rejected these arguments, stating:
[Calhoun] also argues that [the
contracting officer] erred in rejecting its
claim of "coercion," but declines to
specifically identify any coercive behavior
on the part of DOT[&PF's] representatives.
The court's independent review of the record
bears out [the contracting officer's]
conclusion that the only factual basis for
this complaint lies in DOT[&PF]'s
"enforcement of standard operating procedures
and provisions of the contract documents."
That conclusion "has a reasonable basis in
law and fact," and is therefore affirmed.
See Tarbox v. Alaska Transportation
Commission, 687 P.2d 916, 919 (Alaska 1984).
In granting summary judgment to DOT&PF as to Calhoun's 1991
coercion claim Judge Greene noted that Calhoun failed to
distinguish the 1991 coercion claim from the coercion claim
litigated in the 1989 administrative appeal.6
On the basis of the foregoing we conclude that the
superior court correctly held that Calhoun's 1991 coercion claim
was barred by res judicata.
3. The Fraud/Defamation Claims
Calhoun's 1988 superior court complaint contained three
separate fraud/misrepresentation claims. The superior court
directly addressed these claims in its 1989 order requiring
Calhoun to file an administrative appeal as to these claims. In
correctly barring these claims on the basis of res judicata the
superior court in part held:
The evidence in the record does not
indicate whether the fraud/misrepresentation
issues were brought before the contracting
officer. Yet, even if distinct fraud/mis
representation claims were raised, they were
not appealed to the superior court.
Plaintiff's apparent failure to pursue this
claim does not prevent the operation of res
judicata. See Dennis v. Fiscal Court of
Bullitt County, 784 S.W.2d 608, 611 (Ky. App.
1990).
Thus the superior court correctly held that res judicata barred
Calhoun's fraud/misrepresentation claims.
4. The Loss of Bonding Claim
On the issue of the bonding claim, the superior court
held that Calhoun's 1991 claim was barred by res judicata.7 We
affirm the superior court's holding, but rest our decision on a
different basis.8 We hold that Calhoun's bonding claim is barred
by application of administrative res judicata.
We have previously held that "[a]lthough the principles
of issue preclusion have been developed in a judicial setting, we
agree with the modern and now generally accepted view that the
doctrine of res judicata may be applied to adjudicative
determinations made by administrative agencies." Jeffries v.
Glacier State Tel. Co., 604 P.2d 4, 8 (Alaska 1979) (citations
omitted). Thus if a claim could have been raised before an
agency in a prior administrative hearing, res judicata precludes
subsequent litigation of the same claim. Colville Envtl. Servs.
v. North Slope Borough, 831 P.2d 341, 345 (Alaska 1992). Because
Calhoun had the opportunity to litigate the loss of bonding claim
before the contracting officer in 1987, he is precluded from
litigating the same claim under his 1991 superior court
complaint.
We noted in Colville, however, three instances when a
final administrative judgment does not have preclusive effect:
(1) The subject matter of the action was
so plainly beyond the [adjudicative agency's]
jurisdiction that its entertaining the action
was a manifest abuse of authority; or
(2) Allowing the judgment to stand would
substantially infringe the authority of
another tribunal or agency of government; or
(3) The judgment was rendered by [an
adjudicative agency] lacking capability to
make an adequately informed determination of
a question concerning its own jurisdiction
and as a matter of procedural fairness the
party seeking to avoid the judgment should
have opportunity belatedly to attack the
[adjudicative agency's] subject matter
jurisdiction.
Id. at 345-46 (quoting Restatement (Second) of Judgments 12
(1982)). We analyze these exceptions in turn to determine if any
are applicable to Calhoun's bonding claim.
First, we inquire whether determination of Calhoun's
loss of bonding claim is "plainly beyond"DOT&PF's jurisdiction
to adjudicate. We conclude that it is not. DOT&PF's
jurisdiction to adjudicate the claim arises from the language of
the Coldfoot Hangar contract. Specification 00706, the claims
and disputes specification, states that "all claims by the
Contractor for additional compensation . . . or any dispute
regarding a question of fact . . . shall be presented in writing
by the Contractor." Calhoun's bonding claim was based on his
allegations that DOT&PF's actions in administering the contract
affected his bonding and ability to conduct business. As such,
the allegations constituted a claim for "additional compensation"
and "a dispute regarding a question of fact," and thus fell
within the jurisdiction provided by the contract.
Second, we inquire whether allowing an adjudication by
the contracting officer to stand would infringe on the authority
of another tribunal or agency. We are persuaded that it would
not. DOT&PF is the only agency given authority to adjudicate
claims under government construction contracts. Thus its
authority could not conflict with that of another agency.
Finally, we inquire whether DOT&PF lacked the
capability to adequately determine its own jurisdiction. We note
initially that DOT&PF has a professional staff, including a
contracting officer familiar with the claims process and a claims
engineer. Additionally, the Attorney General serves as legal
counsel to DOT&PF. The Restatement (Second) of Judgments states
that the proper question to ask is "whether the [agency] involved
is one in which a challenge to subject matter jurisdiction could
be given substantially the same quality of consideration that is
available in a trial court of general jurisdiction." Restatement
(Second) of Judgments 12 cmt. e (1982), quoted in Colville, 831
P.2d at 350. Given the legal expertise available, we conclude
that DOT&PF clearly was capable of determining its own
jurisdiction.
Since none of the exceptions to administrative res
judicata apply to Calhoun's bonding claim, we hold that his 1991
claim was barred by administrative res judicata.
IV. CONCLUSION
We AFFIRM the superior court's grant of summary
judgment and determination that Calhoun's claims were barred
under the doctrine of res judicata.
_______________________________
1. The claims and disputes specification read, in part:
A. If the Contractor becomes aware of
any act or occurrence which may form the
basis of a claim by the Contractor for
additional compensation or an extension of
time for performance, the Contractor shall
immediately inform the Project Manager. If
the matter cannot be resolved by agreement or
change document within 7 days, the Contractor
shall, within the next 14 days, submit
written notice of the facts which may form
the basis of the claim. In addition, all
claims by the Contractor for additional
compensation or an extension of time of
performance or any dispute regarding a
question of fact or interpretation of the
contract shall be presented in writing by the
Contractor to the Project Manager within the
next 60 days unless the Project Manager
agrees in writing to an extension of time for
good cause shown. . . .
B. In presenting the claim, the
Contractor shall specifically include, to the
extent then possible, the following:
1. The contract
provisions which apply to the claim
and under which it is made;
2. the bid items and
quantities, if any, upon which the
claim is based;
3. the specific relief
requested, including additional
compensation claimed and the basis
upon which it was calculated and/or
the additional time requested and
the basis upon which it was
calculated.
2. The surety loss claim sounded in contract, reading:
Defendant's contractural [sic]
and/or quasi-contractural [sic] breaches has
[sic] resulted in the loss of plaintiff's
surety bond and resulted in a loss of
plaintiff's ability to contract in the State
of Alaska.
3. DOT&PF has summarized the above quoted passage from
DeNardo to state a four element test. Res judicata precludes
litigation of an issue in the following situations:
(1) a judgment on the merits has been rendered;
(2) the new claims arose out of the same
transaction as the previous claims;
(3) the second case is between the same parties;
(4) the new claim was, or could have been,
decided in the first case.
4. We further note that no exceptions to the bar of res
judicata have been shown to be applicable.
5. In regard to this issue the superior court stated:
The 1991 complaint describes the
contract in question as the contract between
Paramount and DOT/PF for the construction of
"DOT Project #R-20066, Coldfoot
Hangar/Generator Addition located at
Coldfoot, AK."
However, the 1988 complaint
contained a breach of contract claim based on
the theory that DOT/PF prevented Paramount
from fully performing the contract by
creating unreasonable delays and effecting
numerous change orders. Even though the
superior court directed Paramount to file
this claim as an appeal of the contracting
officer's decision on its claims for
equitable adjustment, Paramount declined to
appeal this claim. Rather, its appeal
focussed on due process and coercion issues.
Plaintiff has submitted no evidence
to show that this breach of contract claim
differs from the one previously litigated.
The complaint and all the available evidence
demonstrates that Paramount's "new"breach of
contract is nothing but the same one
litigated to final judgment. Consequently,
the court finds that the breach of contract
claim is barred by the doctrine of res
judicata.
6. In its Memorandum Decision and Order, the superior court
stated:
However, plaintiff has neither
delineated nor supplied evidence of the
specific facts supporting this coercion
claim. [Calhoun], as a matter of law, has
failed to meet its burden of demonstrating
that this is not the same claim. As a
result, the court finds the coercion claim is
likewise barred under the doctrine of res
judicata.
7. As to this last claim, Judge Greene noted that under the
terms of the 1989 dismissal of Calhoun's 1988 complaint, Calhoun
was provided the opportunity to raise his loss of bonding claim
in the subsequent administrative appeal. Applying the principles
of res judicata, the superior court thus held that Calhoun's
failure to raise the bonding issue in the administrative appeal
barred his 1991 attempt to revive the same loss of bonding claim.
Tolstrup v. Miller, 726 P.2d 1304, 1306 (Alaska 1986) (res
judicata bars a second suit when the claims were transactionally
connected and the matter could have been decided in the first
suit).
8. We have held that "[t]his court is not bound by the
reasoning articulated by the trial court and can affirm a grant
of summary judgment on alternative grounds." Wright v. State,
824 P.2d 718, 720 (Alaska 1992).
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