Souza & McCue Construction Co. v. Superior Court

GIBSON, C. J. The City of Salinas brought an action against Souza & McCue Construction Co., Inc., seeking damages for the alleged breach of a contract made in June 1958, as modified in September 1958, for the construction of a storm sewer. Souza filed an answer denying the breach and a pleading denominated a ‘ ‘ cross-complaint ’ ’ setting forth two causes of action; the first cause of action is for the recovery of the balance allegedly due under the June 1958 contract as modified, and the second is a common count for goods and services assertedly furnished by Souza at Salinas’ request. After Salinas filed an answer to the cross-complaint, Souza moved for leave to file an amended answer and cross-complaint. The motion was denied, and Souza seeks a writ of mandate to direct the trial court to permit the filing of the amended pleading.

The proposed amended pleading incorporates by reference the allegations of the original answer and cross-complaint and adds a third and a fourth cause of action.

The allegations of the third cause of action may be summarized as follows: Salinas knew prior to entering into the June 1958 contract that the soil at the construction site was unstable and failed to inform Souza of the adverse soil conditions and represented in its plans and specifications that the soil at the site was stable with the intent of inducing Souza to make a lower bid than it would make on the basis of the actual soil conditions. Souza relied on the misrepresentation in making a low bid, and as a result of the unstable soil conditions the cost to Souza of doing the work was much greater than it otherwise would have been. Souza first discovered on July 7, 1961, that Salinas knew of the unstable soil conditions prior to entering into the contract.

The fourth cause of action incorporates the allegations of the third and avers that Salinas, with knowledge of the adverse soil conditions but without intending to mislead Souza in the preparation of its bid, actually did so by failing to inform it of those conditions.

[510]It is alleged, as to all causes of action, that on September 27, 1961, Souza presented a claim for damages which Salinas declined to pay.

Souza’s motion for leave to file the amended pleading was denied by the trial court on the ground, urged by Salinas, that this ruling was compelled by legislation enacted in 1961 (Stats. 1961, ch. 1404) which dealt with the subject of our decision in Muskopf v. Corning Hospital Dist, 55 Cal.2d 211 [11 Cal.Rptr. 89, 359 P.2d 457].1 For the reasons hereafter given we are of the view that Souza’s right of action is in no way dependent upon Muskopf v. Corning Hospital Dist., nor is it in any way affected by the 1961 legislation relating to governmental immunity.