Gladwynne Const. v. Mayor and City Council of Baltimore

HOLLANDER, Judge. This case arises from a construction contract (the “Contract”) between Gladwynne Construction Company (“Gladwynne”), appellant and cross-appellee, and the Mayor ¹⁵⁵ and City Council of Baltimore (the “City”), appellee and cross-appellant. The Contract had a “base bid price” of $497,000, and involved the renovation of several classrooms and science laboratories (the “Project”) at Polytechnic High School No. 403 (the “School” or “Poly”). For reasons that are in dispute, the completion of the work was delayed by almost a year.

On October 3, 1999, after the City failed to make full payment under the Contract, appellant filed suit in the Circuit Court for Baltimore City, seeking to recover damages of $244,638.14 for breach of contract, unjust enrichment, and quantum meruit. Appellant’s claim for damages included extended field costs and home office overhead costs occasioned by the delay in completion of the Contract. The City counterclaimed, seeking $97,500 in liquidated damages because of the delay. Pursuant to a partial settlement between the parties concerning the direct costs for the City’s change orders, the City paid appellant $104,422 on December 15, 2000.

Thereafter, over the course of several days in December, the remaining issues were tried to the court. When the trial concluded, the court indicated that it intended to award appellant the Contract retainage, in the amount of $25,753, as well as $66,083.55 for extended field costs due to the delay, conditioned on appellant’s successful completion by January 16, 2001, of a punch list prepared by Poly’s principal. At a subsequent hearing, the court concluded that appellant had failed to complete the punch list, and therefore it declined to award the Contract retainage. Instead, the court awarded appellant $66,083.55, for extended field costs for a period of 195 days, rather than the 309 days that appellant claimed.

Moreover, the court declined to award any home office overhead expenses occasioned by the delay. On appeal, Gladwynne presents several issues for our review, which we have reordered and rephrased: I. Did the court err in failing to award any damages to Gladwynne for extended home office overhead? ¹⁵⁶ II. Did the court err in failing to award damages to appellants for extended field costs through completion of the Project in January 1999?

III

Did the court err in deducting the Contract retainage from Gladwynne’s award of damages? In its cross-appeal, appellee presents two questions, which we have also reworded: I. Did the trial judge err in awarding any damages to appellant?

II

Did appellant fail to comply with various provisions of the Contract? For the reasons that follow, we shall affirm in part and vacate in part and remand for further proceedings. FACTUAL SUMMARY 1 Gladwynne, a general contractor, submitted a bid to the City in March 1997, to do the renovation of several science laboratories and classrooms at Poly. The City awarded the contract to Gladwynne, and the parties entered into the Contract on or about August 1,1997.

The work was to commence on September 2, 1997, with completion to occur within 180 calendar days, i.e., February 28, 1998. As it turned out, construction was not completed until about 489 days after it began, and some 300 days after the original completion date. The parties stipulated that the Contract was substantially completed on September 11, 1998. Nevertheless, change orders continued until December 1998, and the work was not fully completed until on or about January 31, 1999.

Neither the classrooms nor the laboratories that were subject to renovation were useable or used in the fall of 1998. ¹⁵⁷ Pursuant to the Contract and the Project drawings, Gladwynne was to replace the utility lines located in a hollow crawlspace under a concrete slab in Room 29 of the School. The lines were to service Room 29 and science laboratories two floors above. Appellant was also obligated to install new vinyl floors, lab casework, 2 plumbing, fixtures, lights, and heating and cooling equipment. Based on the Project drawings, appellant planned to replace the utility lines by drilling two four-inch holes into the concrete crawlspace and then working inside the crawlspace to insert new utility lines.

Once the new utilities were in place, the four inch holes were to be patched. Appellant was advised to begin performance of the Contract on September 2, 1997. However, neither appellant nor the City was ever able to locate the crawlspace. While Gladwynne searched for the crawlspace, it was unable to perform any of the work with regard to replacement of the utilities.

Eventually, appellant had to alter its method for replacement of the utility lines. On October 27, 1998, Scott Sider, Construction Contract Administrator, wrote to Frederick Petrella, Jr., an employee in the Construction Division of the Department of Public Works, stating, in part: We have reviewed the Contractor’s Change Order Proposal for changing the plumbing in Rooms 29, 29A, and 29B from being in a crawl space [sic] (as indicated on the Drawings) to being buried in excavated trenches. This change order is required since the crawl space does not exist under those classrooms. Appellant planned, instead, to break up the concrete slab in Room 29, dig a trench to hold new utilities, and then install them in poured concrete.

The trenching work occurred in Rooms 29A, B, and C at Poly, and commenced on November 13, 1997. ¹⁵⁸ According to appellant, when it undertook to perform the trenching work, further delays ensued. For example, while appellant was digging the trenches in the floor to run the utilities in Room 29, it severed existing cable lines submerged in the concrete, which had to be repaired. The tile flooring was also damaged from the trenching and had to be removed. When the existing tiles were removed, Gladwynne found asbestos, which also had to be removed.

That process was not completed until March 1, 1998. By that date, Gladwynne had progressed to the point where it should have been on November 1, 1997. According to Gladwynne, it “was already 170 days into a 180 day contract.” As a consequence of the change in design, Gladwynne was unable to install the plastic utility pipes that it had already ordered and paid for, which were stored on site. Instead, appellant ordered a more durable utility pipe, known as Duri-ron, but had to wait until January 1998 for its arrival.

In February 1998, after the trenching work was completed, and the new Duriron lines were installed, the trenches were filled with concrete. Rather than patching the four inch holes, as originally anticipated, Gladwynne had to smooth the surface of the entire floor of Room 29 to prepare it for the new vinyl floor. In addition, the casework could not be installed until after the new floors were installed. In order to install fixtures, the casework had to be finished.

Then, when Gladwynne discovered leaks in the laboratory windows, the City hired another contractor to do the repair work; that contractor was unsuccessful in stopping the leaks, and Gladwynne had to cease installation of the casework in July 1998, until the leaks were remedied. In addition, appellant claimed that delays were occasioned by the architect, who continued to make changes in the work through December 1998, which adversely affected appellant’s productivity. Appellant identified more than fifty changes to the construction plans made by the architect. For example, Gladwynne maintains that the architect failed to include gas ¹⁵⁹ pipes to service the Bunsen burners in the laboratories, delaying the work that depended upon gas service.

Design defects or changes also resulted in moving drain lines to avoid lights, constructing enclosures for pipes, adding electrical lines and lights, and adding electronic controls for the heating and cooling systems. According to appellant, unforeseen problems and changes extended the job and caused Gladwynne to incur additional field and home office expenses. Gladwynne conceded that the Project was almost finished in November 1998, when Thomas Behrle, its president, began work on a project for the Corps of Engineers. Nevertheless, Gladwynne continued to work on the Project through January 1999.

Gladwynne disputed the alleged percentage of completion specified in the progress meeting notes on which the City relied. Gerald Weeks, Chief of the Construction Management Division in the Bureau of General Services, Department of Public Works, acknowledged that the 91.6% completion figure in the Contractor’s Current Estimate for May 1998, pertained only to the original Contract, exclusive of change orders, and included the purchase of $135,000 in casework material, which was on site but not yet installed. Similarly, the 93% completion figure in the progress meeting notes of May 5, 1998, pertained only to the original Contract work, exclusive of change orders. Nevertheless, relying on the progress meeting notes of May 5, 1998, Weeks maintained the Project was 93% complete at that time.

He was of the view that appellant should have been able to complete the remaining 7% of the Project in the ensuing three weeks. Accordingly, the City compensated appellant through May 1998 for its direct costs. As it turned out, appellant did not achieve substantial completion until September 11, 1998. Moreover, the last change order was not issued until December 1998.

The progress meeting notes of May 5, 1998 stated, in part: ¹⁶⁰ Notice to Proceed: September 15, 1997 Completion Date: March 15, 1998 Contract Days: 180 Days Remaining: -51 Percentage of Completion: 93%, Outstanding Change Orders Still Outstanding A. Floor penetration and repairs in lieu of coredrilling submitted B. Add plumbing and electrical service to 9B, 29C, 163, 232, 138,183B C. Sawcut and re-pour plumbing trenches in 29. submitted D. New plumbing layout in 29, 29A, 29B. submitted E. New floor penetrations for ductwork to miss cables. submitted F. Add gas service to 29B, 29C, 139, 232, 163B. submitted G. Demo slab under platform in 163. Level floor. submitted H. Remove cabinet and revise plumbing due to CMU wad in 124 I. Move drain line in 124 J. 29A leaking faucets K. Refrigerator and DW-hook up only Old Business Cabinets being installed DW and Refrigerators on site The change order proposal of September 2, 1998 said in ■ part: demo fancoil unit in 29 connect new fancoil unit supplied by city (patterson) The notes also stated: “Additional contract time will be required total 3 days.” In response, Kann and Associates, ¹⁶¹ Inc., the architectural firm for the Project, stated that the “work was required to replace an existing malfunctioning unit ....”, but that “the Contractor’s Change Order Proposal is not reasonable and should be revised and resubmitted.... ” Appellant submitted in evidence proposed change orders dated August 18, 1998, September 2, 1998, and December 7, 1998. The change order of December 7, 1998 said, “new compressed air main due to poor condition of the existing lines.” Further, it indicated: “Additional contract time will be required total 10 days.” In response, Sider, the Project architect, agreed with the request, stating: “This change order is required.. .. ” He added that the “proposed cost values are reasonable and should be accepted.... ” The following testimony of Behrle is also relevant: [APPELLANT’S COUNSEL]: Mr. Weeks testified with regards to Defendant’s Exhibit 2, which is an April of '98, Contractor’s Current Estimate, that Gladwynne was 91.6 percent complete. Do you recall that testimony? [BEHRLE]: Yes. [APPELLANT’S COUNSEL]: Okay.

Were there any change-orders included in that amount? [BEHRLE]: No. [APPELLANT’S COUNSEL]: All right. Now, Defendant’s 3. Before you turn to Defendant’s 3, let me ask you about drilling for the case work [sic]. That’s $135,000.00 that you billed for in April and you hadn’t put a thing in yet.

Is that correct? [BEHRLE]: That’s [$]127,500. [APPELLANT’S COUNSEL]: Okay. [BEHRLE]: And we had not installed any. [APPELLANT’S COUNSEL]: Had not installed any. Now, you’re actually billing for it before it’s installed. [BEHRLE]: Yes. [APPELLANT’S COUNSEL]: Why is that?.... [BEHRLE]: Well, it’s normal procedure. ¹⁶² [APPELLANT’S COUNSEL]: All right. Now, turn, please, to Defendant’s Exhibit 3, the progress meeting. Do you see that? ■ [BEHRLE]: Yes. [APPELLANT’S COUNSEL]: Now, Mr. Weeks testified that the 95 percent completion that’s listed there includes all change-orders.

Do you agree with that? [BEHRLE]: No. [APPELLANT’S COUNSEL]: Why not? [BEHRLE]: It says 95. If you look at Item One, the outstanding change orders, they’re still outstanding. They’ve been submitted. We have received none of them.

So, we’ve received no change orders and no time, so it can’t possibly account for the change orders. [APPELLANT’S COUNSEL]: So, 11 of the change orders are in— [BEHRLE]: Yes. [APPELLANT’S COUNSEL]: But none have been issued? [BEHRLE]: That’s correct. None have been issued. [APPELLANT’S COUNSEL]: Now can you explain to the court why your office generated a document stating that you were 93 percent complete? [BEHRLE]: Again, it does not take into account the change orders, and it’s counting for the fact that there are stored materials, 29 percent of that April invoice, Exhibit 2, 28 percent is the cabinets. If you take 91 from 28, we can all do the math. Well, it’s 63 percent complete besides the cabinets.

On October 14,1998, the Construction Management Division filed a Report of Unsatisfactory Contractor Performance (the “Report”), citing problems in the areas of workmanship; manpower and equipment; supervision; management of subcon ¹⁶³ tractors; prompt and adequate clean-up of work areas; and cooperation with other contractors, architects, and City personnel. Moreover, Poly’s principal, Ian Cohen, blamed Gladwynne for the delays and for various construction problems. He testified, in part: [COURT]: ... Can you give me some idea of how the work was flowing on a day to day basis from the time that the work was started until the time that it stopped? [COHEN]: As I mentioned and from naive perspective and certainly that is not my expertise in construction management. ...

And so my sense of it is it was like fits and starts. That’s why I said before it was all hurry up and wait. [COURT]: Tell me what that means? [COHEN]: Days when there were be [sic] a number of workmen in the building. And days when there would be nobody. And as I would hear things like well, we might not be coming back ‘cause we’re not getting paid.[’] [COURT] Do you know the difference between Mr. Burrow and his people, and those that would be considered by others to be subcontractors.

Did ... you ever know who his people were? [COHEN]: I can’t say that I knew whether any individual would have been a subcontractor or a representative of Gladwynne. [COURT]: Okay. Okay. Did ever somebody be [sic] there when there was not this hurry up going on in between? Were there people there working with Mr. Burrow the days that he was there, working directly with him? [COHEN]: I can’t say that — I can’t answer that.

According to the City, the number of superintendents on the job contributed to the delay in completion of the Project. Behrle acknowledged that there were at least four different superintendents, which he admitted was unusual, given that the Project was only supposed to last 180 days. He also acknowledged that he only had a superintendent on the site ninety-five percent of the time. As of November 1998, when ¹⁶⁴ Behrle began to work at another project, no superintendent was at' the School.

Behrle testified that there were no valid punch list items outstanding, and claimed the City was seeking performance of work by appellant that was beyond the scope of the Contract. Nevertheless, after the City rested, the court ordered Cohen to create a written list of problems that he had with Gladwynne’s work, so that any incomplete items could be addressed. In response to the court’s directive, Cohen prepared a memorandum dated December 22, 2000, listing the following problems as unresolved: Room 163 — Faulty electrical outlet on new hood — Faulty electrical outlet along the side of the hood (near door) Room 29 — 4 faulty electrical outlets Room 230 — 2 faulty electrical outlets — leaking faucet — severed electric lines running to the spotlights With respect to field costs, appellant claimed delay damages for 309 days, totaling $149,247. Appellant calculated the extended home office overhead costs allocable to the Project using the so called Eichleay formula. 3 Exclusive of officers’ salaries, appellant relied on a rate of $227 per day for 309 days, for a total of $70,143.

Appellant has adjusted its claim to recover overhead for 245 days, at a rate inclusive of officers’ salaries. As the City concedes in its brief, “there were delays in the early stages of the project,” for which appellant was not responsible. Nevertheless, Weeks testified that appellant should have completed the Project by May 30, 1998. There ¹⁶⁵ fore, the City granted appellant an extension of performance of only ninety-one days.

In court on January 3, 2001, the court set forth its “temporary understanding” of its “decision.” It indicated that it intended to enter judgment in favor of appellant in the amount of $91,836, conditioned on Gladwynne’s prompt and satisfactory completion of a punch list prepared by the School’s principal. If appellant failed to complete the punch list, however, the court said appellant would forfeit the Contract retainage of $25,754. The following colloquy is relevant: THE COURT: [I]t is the intent of the court ... to recognize the $25,753.00 is outstanding to plaintiff from the contract itself... . [Bjoth parties acknowledge that there’s a punch list of items that need to be done, and that it is the court’s intention that if the punch list items are not done within 10 days of today’s date, each and every item to the satisfaction of defendant’s representative, i.e., Director, Mr. Cohen, as Director of the School, a third party beneficiary of the contract, is that the court will deem that it takes $25,753.00 of offset to complete those items. I would assume ... that [appellant] would rather complete the punch list themselves.

Otherwise, I can give my decision today. [APPELLANT’S COUNSEL]: ... Your Honor, we would need to discuss [this] with our subcontractors.... In effect, the court presented appellant with the proverbial Hobson’s choice. It said: [THE COURT]: The bottom line is, is that you could object now and say, I don’t want to do it, and I’ll make my ruling, and my ruling will be, is that I’m offsetting [$]25,753 as the amount that’s needed to do the punch list.

Gladwynne’s attorney responded: [APPELLANT’S ATTORNEY]: We’ll address the punch list. Regarding timeliness of completion, the court stated: ¹⁶⁶ [THE COURT]: The base contract ... has a completion date of February 28th, which would be the 180th day. It is uncontradicted that certain things did, in fact, affect that [completion] date, most notably would be the crawl space in question, the trenching that needed to be done, and the asbestos tiles that needed to be dealt with. There is no question that it impacted the dates and times.

And for any suggestion otherwise is an absurdity. While, in fact, there was a negotiation, if you will, of the change orders, between plaintiffs and a representative of the defendant, i.e., Mr. Weeks as I understand it, there is a dispute as to the amount of days that would have taken for the change-orders to have been done. The court determined that it was reasonable for appellant to seek an extension of time under the Contract through September 11,1998. It reasoned: What has happened is, is that both parties began to, in testimony, refer to September 11th, 1998 as the substantial completion date.

Although there was discussion by the defendants as to adjustments, et cetera, and the court finds that, in fact, while there were discussions of activity after the September 11th date, the question of whether or not a party was, in fact, present or workers present on all of the days, what is clear here is, is a substantial portion of the actual contract was to be done by subcontractors, and the coordination of such. It is clear from the evidence is that the superintendent was not on the job daily nor expected to be on the job daily. What is clear here is there’s a question of who the Project Manager was, and whether or not the Project Managers were, in fact, on the job daily even if there are payments being made to persons. The court, for the purposes of adjusting all the facts, circumstances and evidence before the court, feels compelled to give an extension of the time to plaintiff, and does do so up to and including September 11th, 1998 as the adjustment date, if you will.

The court takes that as an ¹⁶⁷ extension of 195 days to the base contract, if you will, of the time.[ 4 ] The court awarded extended field costs, calculated by using the daily general conditions rate of $338.89 per day that the City had proposed, and then multiplying that rate by the extended performance period of 195 days. The court did not award damages, however, for extended home office overhead costs, because the court determined that, as to the Eichleay formula, “all of the elements [were] not present and shown.” It reasoned: The court agrees with defendant that the only figure that makes sense to the court is the base, the original contract, that it’s untainted, if you will, as to the method of getting to dollars and cents or figures. By that I mean, is that the court is again disturbed by the suggestion of plaintiff in its testimony that, in fact, this $120,000.00 for the superintendent is just thrown in there.[ 5 ] And how we get up the 500 and some odd dollars per day, et cetera, just boggles my mind to even think that it should be even suggested to a court, and doesn’t think that it would shock the court in a negative manner, I can’t explain. But that isn’t the purpose here.

I’ve made my point. Is that in the original contract itself it gave $61,000.00 as the general conditions as such, and it is reasonable to assume is that the general conditions, as such, if extended in terms of time, is that the general conditions is a way of measuring that which the overhead and expenses of plaintiff, dividing that original amount of [$]61,000 by 180 days, which was that of the original contract, one then finds $338.89 per day. The court therefore looked at August 11th, '98, which was said to be 98 percent completion, but I will tell you that that was the intent of the court to use the August 11th date but ¹⁶⁸ for the discussion of both parties of the September 11th date as substantial completion date, as such. Therefore, from February 28th to September, February 28th to September 11th, 1998, is 195 days. 195 times 338.89 is $66,083.55.

Assuming that the punch list items are completed within 10 days, the court will grant $25,753.00 as the balance of the contract. The Court concluded: It is the intention of this court therefore based on all that’s before the court, is to grant judgment in favor of plaintiff in the amount of $91,836.55. If plaintiff fails to comply with the agreement on today’s date of rendering the existing punch list items, as an amount at issue, then the amount is to be $66,083.55. Accordingly, the court continued the matter until January 16, 2001, while Gladwynne undertook to perform the punch list work specified by Cohen.

When the parties returned to court on January 16, the City claimed that the punch list was not satisfactorily completed. Gladwynne’s counsel disagreed, and suggested that all the items on the list were not within the scope of the Contract. Appellee’s attorney responded that the “appropriate time to object to items on the punch list” was at trial. The court allowed the City to establish appellant’s unsatisfactory performance by proffer.

The following colloquy is relevant: [APPELLEE’S COUNSEL]: Your Honor, if called to testify we have three individuals from, two from SIDHU Associates [an engineering consulting firm] and one from the architect. The mechanical engineer would testify that of the mechanical engineering items, the mechanical items on the punch list as contained in Defendant’s Exhibit 8; ten percent of the mechanical items have been completed. As far as the electrical work is concerned thirty to forty percent of the punch list items have been completed. And as far as the architectural matters; forty percent have been completed. ¹⁶⁹ Mr. Cohen, if called to testify would state that he is totally unsatisfied with the completion of the punch list items.

Additionally, the court allowed the City to read into the record a memorandum from Cohen, dated January 12, 2001, expressing his dissatisfaction with Gladwynne’s performance. He said: Based on Mr. Burrow’s statements during the walk through on January 4; we’ll decide which items that we are going to do. The fact that he didn’t even stay for the entire walk through. The fact that in meeting at the school on January 10th he asked me if there was some punch list items that the school would accept a small fee for in leu [sic] of the work being done.

And his consistency in making excuses for the undone items saying that they couldn’t be completed. I am certain that he never had the intention of completing the punch-list to our satisfaction. Indeed, as today’s walk through revealed, much of the work remains undone or has been done in extremely shoddy and slip shod fashion with potential hazards to students in some cases. This is an unacceptable and inexcusable situation.

In addition, I believe that it is important to add to the record that the items that [the court] wished me to list as incomplete. Which 1 faxed to you just before our winter break; were not all completed contrary to what Mr. Burrow stated on January 3. Therefore, I am asking you to report to [the judge] per his request that for the above reasons the school remains deeply troubled and unsatisfied with the unresolved situation. I believe strongly that the judge’s decision on January 3 to hold back the stipulated sum [if] the punch list items remain incomplete should be implemented in its entirety....

In response, the following dialogue is pertinent: [APPELLANT’S ATTORNEY]: Your Honor, this is the first that we have heard that Mr. Cohen’s list, the items that ¹⁷⁰ were on that list were never completed, that was never conveyed. [THE COURT]: If you were communicating with Mr. Cohen on January 15th— [APPELLANT’S ATTORNEY]: We were— [THE COURT]: — I am assuming that he would have said the same thing to you and your client. [APPELLANT’S ATTORNEY]: He did not. [THE COURT]: I do not understand. [APPELLANT’S ATTORNEY]: I have a proffer. [THE COURT]: Did you speak with Mr. Cohen on January 15th? [APPELLANT’S ATTORNEY]: I did not, Mr. Burrow spoke with him. [THE COURT]: Then my concern is that if he spoke with Mr. Cohen on January 15th there is nothing before this court that would question the credibility of Mr. Cohen, sir. Now, if you have something to bring to this court’s attention as to why Mr. Cohen’s word should be doubted and would not have been the same on the 15th. And that this court left its chambers after five o’clock on January 15th and heard not from you or your client then I am confused. [APPELLANT’S ATTORNEY]: I cannot cross examine a proffer, but I do have Mr. Burrow who— [THE COURT]: You can proffer whatever you want. (Emphasis added).

Appellant’s attorney “thoroughly disagree[d]” with the percentages of completed work. He also reviewed various disputed items for each room at Poly subject to the Contract. Appellant’s attorney said: Mr. Cohen’s lack of satisfaction is simply based on the fact that he is getting information from SIDHU. SIDHU was never [sic], never participated with any walk through with us to generate the punch list.

SIDHU never partid- ¹⁷¹ pated in any of the change orders that created for deducted work. Your Honor, I have a list right here of the work that was accomplished. Of the [$]25,000.00 that is being withheld we estimate that less than [$]2,000.00 of work remains. Nevertheless, claiming that the “items have not been completed as ordered by this court,” the City urged the court to deduct $25,758 from Gladwynne’s award.

The court agreed with the City and declined to award appellant the retainage of $25,753. Instead, it entered judgment for appellant only for field-related delay damages, in the amount of $66,083.55, rather than the sum of $91,836.55 that the court had contemplated on January 2, 2001. The court reasoned: ... Plaintiffs has [sic] attempted to make arguments as to calculations and figures and Plaintiffs [sic] credibility in so doing is at the point of that the court cannot rely upon the information received from Plaintiffs [sic].

And, so, therefore the court has disregarded in total that which is suggested as a method of calculation or the actual calculations made by Plaintiff or his counsel. Most specifically the suggestion that a punch list should be valued at two thousand dollars is only an example of the manner in which Plaintiff has approached the discussion in this court and the introduction [of] evidence. The method of its argument suggest [sic] not as to a reasonable interpretation of the facts, but that which is a misinterpretation of the facts. Further, what the court could have done reasonably in this case.

Could have stated that it agreed with Plaintiff and based on the evidence introduced by Plaintiff could have stated specifically that Plaintiffs exhibit was is [sic] that the amount of additional time should be at 141 days. And that Mr. Weeks had given credit in his mind of 76 of those days at the time [sic] discussion. A list of those items that were considered as additional items and for payment were submitted to Mr. Weeks. Mr. Weeks stated 76 days [sic] allowed. ¹⁷² Plaintiff specifically only asked for 141 days.

While, in fact, the 76 days were not added onto in terms of calculation. But if the court took Plaintiffs calculation of 141 days; the court has already stated as to why the amount is [$]338.89 per day rather the [sic] five hundred and some odd dollars suggested by Plaintiff itself. However, that calculation alone would have suggested that the judgment should be in the amount of [$]47,783.49. * * * I will repeat that the intended beneficiaries of the contract were the children, the students of Baltimore Polytechnic Institute. To disrupt that school in the main areas of its education and its students.

And to go more than a year beyond the intended date of completion is indefensible professionally, it is indefensible professionally. Now, if you are listening to lawyers and not writing letters, that’s Plaintiffs [sic] problem. And I am holding Defendants to the same standard that someone should have done something. And that is the only reason that the indication is not zero.

Because the court cannot rely on the calculations and the evaluations of Plaintiff. And the clear indication that it meant to and intended to mislead the court. The court cannot do anything but conclude that that which was the retainage for the amount for the remaining work should be retained and the work should be done by someone else. Based on the evidence as such is that the court will not retract from its basis in granting judgment in the amount of [$]47,783.49.

But the court does go, back to the calculations and saying that in fact, the court have [sic], if argued by defendant used 164 days. But because defendants also used the same date of substantial completion as Plaintiffs [sic] the court made the calculation to be 195 days. Because of the amount of general conditions in the actual contract is that the court came to the conclusion of the daily amount of [$]338.89. ¹⁷³ Let me restate is that Defendant’s evaluation of the situation based on contract could have warranted a total decision on behalf of defendant but for that which was his client. And the testimony would suggest that they capitulated in part to Plaintiffs inactivity.

There is no suggestion here that he had enough people to do the job. [Tjherefore, the Court finds in favor of Plaintiff, judgment in favor of plaintiff in the amount of [$]66,083.55. So ordered. We shall include additional facts in our discussion. STANDARD OF REVIEW When, as here, an action is tried without a jury, we review the case on both the law and the facts.

The clearly erroneous standard governs our review of the court’s factual findings. Gwynn v. Oursler, 122 Md.App. 493, 502 , 712 A.2d 1072 , cert. denied, 351 Md. 662 , 719 A.2d 1262 (1998); Barnes v. Children’s Hosp., 109 Md.App. 543, 552-53 , 675 A.2d 558 (1996); Md. Rule 8-131 (c); see Porter v. Schaffer, 126 Md.App. 237, 259 , 728 A.2d 755 , cert. denied, 355 Md. 613 , 735 A.2d 1107 (1999). Our role is not to determine whether we would have reached different factual conclusions than the trial court, or to substitute our judgment for that of the fact finder. Barnes, 109 Md.App. at 553 , 675 A.2d 558 ; Mercedes-Benz v. Garten, 94 Md.App. 547, 556 , 618 A.2d 233 (1993).

Rather, “[i]f there is any competent, material evidence to support the trial court’s factual findings, then we cannot set them aside as ‘clearly erroneous,’ even if we might have found otherwise.” Barnes, 109 Md.App. at 553 , 675 A.2d 558 . Moreover, we review the evidence produced at trial in the light most favorable to the prevailing party. Murphy v. 24th Street Cadillac Corp., 353 Md. 480, 497 , 727 A.2d 915 (1999). We also assume the truth of the evidence presented, and all favorable inferences that can be inferred therefrom.

Id. In reviewing a trial court’s conclusions of law, however, we do not apply the clearly erroneous standard. Heat & Power ¹⁷⁴ Corp. v. Air Products & Chemicals, Inc., 320 Md. 584, 591 , 578 A.2d 1202 (1990). Instead, our review is more expansive.

Narayen v. Bailey, 130 Md.App. 458, 461-62 , 747 A.2d 195 (2000). We review de novo the trial court’s legal interpretations and conclusions' of law, without any deference. Porter, 126 Md.App. at 259 , 728 A.2d 755 . Our purpose is to determine whether the trial court was legally correct.

Gregg Neck Yacht Club, Inc. v. County Comm’rs. of Kent County, 137 Md.App. 732, 752 , 769 A.2d 982 (2001). DISCUSSION I. Appellant contends that it was entitled to recover damages for extended home office overhead costs for 245 days, representing the period from March 1, 1998 (the day after the original Contract completion date) through November 1, 1998. Gladwynne complains, however, because the court failed to award any delay damages for home office overhead expenses. According to appellant, exclusive of officers’ salaries, the Project generated daily overhead costs of $227.

On that basis, the overhead delay damages would total $55,615. Inclusive of officers’ salaries, the home office expenses generated a daily rate of $435. 6 For 245 days, the claim amounts to $106,575. Although the City concedes that at least some delay was chargeable to the City, it contends that appellant failed to establish its claim for overhead damages under the Eichleay formula. The court clearly believed that some delay was attributable to the City, because it awarded delay damages for ¹⁷⁵ extended field costs, based on a finding of delay of 195 days. 7 Nevertheless, the court did not allow any delay damages for overhead, ruling “that Ikely [sic] as a formula does not apply in this case based on the contract, circumstances and factors of evidence that were submitted in this case.” The court did not specify, however, which particular element of the Eichleay formula was not satisfied.

In Dewey Jordan, Inc. v. The Maryland-National Capital Park and Planning Comm’n., 258 Md. 490, 498 , 265 A.2d 892 (1970), the Court of Appeals recognized that a “contractor is entitled to be compensated for delays in work occasioned by faulty plans and specifications.” There, the contractor filed a breach of contract action arising from the suspension of construction on a project because of defective plans and specifications. The contractor sought damages for its costs during a one month “shutdown” that was “due to no fault of its own.” Id. at 493 , 265 A.2d 892 . The Court ruled that the contractor was entitled to recover damages for the delay in execution of the contract, stating, at 258 Md. at 498 , 265 A.2d 892 : [T]he contracting authority impliedly warrants that the plans and specifications are adequate and sufficient for the purpose intended and that the contractor is entitled to be compensated for delays in work occasioned by faulty plans and specifications. The Eichleay formula was not at issue in Dewey, however.

Moreover, although this Court upheld the trial court’s use of the formula in General Federal Constr., Inc. v. D.R. Thomas, Inc., 52 Md.App. 700 , 451 A.2d 1250 (1982), the formula itself was not at issue, because the defense did not object to the evidence presented at trial as to overhead. Consequently, the Court observed that the appellants could not complain about it. Id. at 707-08 , 451 A.2d 1250 . ¹⁷⁶ We have not uncovered a reported Maryland case that has expressly adopted the Eichleay formula. Regardless of the particular overhead rate or the actual length of delay, our resolution of the claim for damages for extended overhead requires us to consider the Eichleay formula.

The Eichleay formula derives from a case heard by the Armed Services Board of Contract Appeals, captioned Appeal of Eichleay Corp. (1960), ASBCA No. 5183 , 1960 WL 538 . It concerns “home office overhead” costs, which are “ ‘those costs which are expended for the benefit of the business as a whole and which usually accrue over time.’ ” Wickham Contracting Co., Inc. v. Fischer, 12 F.3d 1574, 1578 (Fed.Cir.1994) (citation omitted). Home office costs are indirect expenses that “cannot be traced to any particular contract.” Id. Generally, overhead costs “benefit and are caused by the business as a whole, not any one project.” Id. at 1578 .

Moreover, “[ujnlike direct costs' which are incurred only because of a particular contract, overhead costs are incurred even if the contractor had not undertaken a particular project.” Id. at 1579 . The Eichleay formula “ ‘is the most well known formula for calculating unabsorbed overhead’ costs arising out of government-caused delay.” Complete General Constr. Co. v. Ohio Dep’t of Transp., 94 Ohio St.3d 54 , 760 N.E.2d 364 , 367 (2002) (citation omitted). Ordinarily, overhead costs subject to the Eichleay formula include items such as administrative and officers’ salaries, rent, páyroll, taxes, insurance, depreciation, dues, office expenses, utilities, cleaning, travel, and telephone expenses.

Wickham, 12 F.3d at 1576 ; C.B.C. Enterprises, Inc. v. United States, 978 F.2d 669, 672 (Fed.Cir.1992). The formula, which computes a “constructive daily rate ...,” id., is as follows: 1. Contract billings/Total billings for contract period x Total overhead for contract period = Overhead alloca-ble to the contract 2. Allocable contract overhead/Days of performance = Daily contract overhead ¹⁷⁷ 3.

Daily contract overhead x No. of Days of Delay = Amount recoverable Capital Elec. Co. v. United States, 729 F.2d 743, 747 (Fed.Cir. 1984); see C.B.C., 978 F.2d at 673 . 8 In general, the Eichleay formula applies when a contractor “incurs extended overhead expenses as a result of government-caused delay....” C.B.C., 978 F.2d at 671 . It “is used to determine a government contractor’s damages” with respect to “unabsorbed home office overhead when the government delays work on the contract indefinitely but requires the contractor to remain available to resume work immediately on the government’s instruction.” Satellite Elec. Co. v. Dalton, 105 F.3d 1418, 1419 (Fed.Cir.1997); see Wickham, 12 F.3d at 1577 (stating that the Eichleay formula is used “when disruption, delay or suspension caused by the government has made uncertain the length of the performance period of the contract”).

Conversely, a claim for overhead is not compensable when the delay does not preclude the contractor “from taking on additional work or reallocating its resources.” Satellite, 105 F.3d at 1420 . The underlying rationale of the Eichleay formula was elucidated in Wickham, 12 F.3d at 1577-78 . There, the court said: Suspension or delay of contract performance results in interruption or reduction of the contractor’s stream of income from payments for direct costs incurred. This in turn causes an interruption or reduction in payments for overhead, derived as a percentage of direct costs, which is set by the contract.

Home office overhead costs continue to ae- ¹⁷⁸ crue during such periods, however, regardless of direct contract activity. Consequently, this decrease in payments for direct costs creates unabsorbed overhead, unless home office workers are laid off or given additional work during such suspension or delay periods. When the period of delay is uncertain and the contractor is required by the government to remain ready to resume performance on short notice (referred to as “standby”), the contractor is effectively prohibited from making reductions in home office staff or facilities or by taking of additional work. Other reasons such as exhaustion of bonding capacity may also preclude additional contracts.

(Internal citations omitted). In order for a contractor to recover under the Eichleay formula, three elements must be satisfied: (1) the plaintiff must prove that the contract was suspended, delayed, or disrupted by the government; (2) the plaintiff must prove that he/it was forced to “stand by” during the delay; (3) the plaintiff must prove that, while “standing by” during the suspension, delay, or disruption, he/it was unable to take on other work. Satellite, 105 F.3d at 1421 ; Altmayer v. Johnson, 79 F.3d 1129, 1133 (Fed.Cir.1996); Interstate Gen. Gov’t.

Contractors v. West, 12 F.3d 1053, 1056 (Fed.Cir.1993). When the contractor establishes a prima facie case of entitlement to use the formula, the burden of production as to the third element shifts to the government. Satellite, 105 F.3d at 1421 ; Mech-Con Corp. v. West, 61 F.3d 883, 886 (Fed. Cir.1995). At that point, the government must present