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Condrin Construction Co. v. Hartford Accident and Indemnity Co.

Decided: February 9, 1981.


On appeal from Superior Court of New Jersey, Law Division, Passaic County.

Allcorn, Kole and Pressler. The opinion of the court was delivered by Allcorn, P.J.A.D.


[177 NJSuper Page 252] In 1973 Montclair State College determined upon the reclamation of an old quarry site then extant on its property in Little Falls, for ultimate usage as an athletic field. The means proposed

was by way of utilization of the quarry site as a solid waste sanitary landfill to a final elevation conforming to the topography of the surrounding area, after suitable topping and landscaping.

Following advertisement for bids, Montclair State entered into a contract with Carrino Contracting & Trucking Company, dated April 12, 1973, by the terms of which Carrino undertook to perform the work necessary for preparation of the quarry site for use as a sanitary landfill operation, for which the College was to pay no cash consideration whatever,*fn1 the arrangement contemplating that, after preparation of the site, the successful bidder would operate and use the sanitary landfill at its own cost and expense in connection with its own solid waste collection business and charge and collect fees from other users for the privilege of depositing solid waste therein. The contract stipulated that the entire operation, including the site preparation work and the filling and landscaping of the site, would be completed by a date "no longer than eighteen (18) months after award of contract."

The contract required the contractor to supply "a Performance Bond" as security for the performance of the contract, and a "Payment Bond" to secure "the payment of all persons performing labor on the project." Notwithstanding the contract provision that the construction of the improvement was to be at no cost to the College, Carrino supplied to the College a single combined performance and payment bond, issued by defendant Hartford in the required amount ($20,000), in the form prescribed by N.J.S.A. 2A:44-143 et seq. In keeping with the statutory provisions, the bond ran to the State (College) and was conditioned upon the proper performance of the work in accordance with the terms of the contract of April 12, 1973, and was further conditioned upon the payment by the contractor (Carrino)

of "all lawful claims" of subcontractors and for labor, material, equipment, etc., "used or consumed" in the performance of the contract. N.J.S.A. 2A:44-147.

On May 9, 1973, subsequent to the execution of the contract between Carrino and the College, Carrino entered into an agreement with plaintiff (Condrin) by which Carrino subcontracted to Condrin a portion of the site preparation work. The work so subcontracted dealt with the furnishing of materials for and the construction and installation of an underground water supply line from the College's existing water main to the vicinity of the landfill site, terminating at a new fire hydrant, also to be furnished and installed by Condrin.

It appears to be uncontroverted that Condrin thereafter commenced the work covered by the subcontract and, by June 25, 1973, had completed almost the entire job -- approximately 95% thereof. The final aspects were impossible to complete due to the presence of obstructions created by an existing underground gas main and electrical duct. Condrin thereupon notified Carrino and the College of the existence of the obstructions, advised that Condrin could not proceed further with his work until the obstructions had been relocated, and requested that they be relocated. Both Carrino and the College seemingly failed to relocate the obstructing facilities and, after two months following the initial notice to Carrino and the College, Condrin advised Carrino that Carrino's failure to act in this regard "rendered our performance to complete [the work] impossible," and demanded payment of the contract price. Subsequently, Condrin sued Carrino for the work performed and the materials supplied. Condrin recovered judgment against Carrino for the balance, in the principal sum of $8,500, plus interest and costs, which judgment remains unsatisfied.

In the meantime, and on or about February 26, 1975, Carrino and the College entered into an entirely new contract for the reclamation work which superseded the contract of April, 1973. The reason stated in the new contract was because the term of

the 1973 contract "expired" by reason of unforeseeable delays. In substance, the superseding (1975) contract contained the same provisions -- with, however, at least one significant exception. That exception extended the time for completion of performance of the contract from 18 months after April 12, 1973 until 24 months from February 26, 1975, with a permitted additional 12-month extension if agreed upon by the parties. In addition, the superseding contract required Carrino to post a performance bond in the sum of $100,000 and a maintenance bond of $300,000, with no requirement for the posting of a payment bond -- in contrast to the original ...

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