Anchorage Asphalt Paving Co. v. Lewis

J. R. Lewis (defendant) owned a mobile-home park. In 1969 Lewis hired Anchorage Asphalt Paving Co. (Anchorage Asphalt) (plaintiff) to pave the roads within the mobile-home park. Anchorage Asphalt completed the work in April 1970, but the roads deteriorated soon after. Lewis had paid Anchorage Asphalt $30,000 of the $57,052.50 contract price, but Lewis refused to pay any additional amount when the roads began to deteriorate. Anchorage Asphalt filed suit against Lewis, claiming Lewis breached the contract by failing to pay the remainder of the contract price. Lewis counterclaimed for breach of contract, alleging that Anchorage Asphalt failed to properly pave the roads. After several appeals, Anchorage Asphalt was found liable for failing to warn Lewis that the pavement subsurface was inadequate, and Lewis was liable for payment of the remainder of the contract price. A third trial on damages was held in 1979. Between 1970 and 1979, significant inflation occurred, with an inflation rate of 81 percent between 1972 and 1979. Lewis’s expert testified that in 1979 it would cost $114,987 to reconstruct the roads. The trial court awarded Lewis $114,987 in damages with prejudgment interest. The trial court also awarded Anchorage Asphalt the unpaid remainder of the contract price, $27,052.50, with prejudgment interest. Anchorage Asphalt appealed, arguing in part that Lewis’s damages should have been calculated using a 1970 valuation of damages and prejudgment interest was inappropriate.