Most construction disputes begin with
a surprise. And no job can astonish better than rehab work. So how do you stay out
of disputes on repair jobs? Maybe you can’t. But a case decided earlier this month
in Maine may be a good model for contractors on residential and light commercial
repair jobs.
Chris Bond agreed to have Riley Woodwork
remodel the Sebego Lake Rowing and Sailing Club in Standish, Maine. Before taking
the job, Riley warned that the clubhouse was an old building – rotted floor joists
and subfloor and outdated electrical system. Riley wrote what he called a “baseline”
bid and added a caution about unforeseen problems. The job scope might change once
work started. Riley estimated the baseline cost at $26,781. Bond signed a written
agreement to pay more for approved extras.
That was a good beginning but not the
end. Bond had another project for Riley, renovation of a condominium in South Portland.
While work on the Sebego Club was still in progress, Bond had Riley start on the
condo job – and even asked Riley to make that a top priority.
Two months later, Riley was about done
with the condo. He requested final payment of $6,674. Bond admitted he owed the
money but refused to pay until some additional work was done, about a day’s work,
according to the trial transcript. Riley wanted to be paid first. Bond wouldn’t
do it. The result was a general falling out between Bond and Riley.
Bond ordered Riley to stop work on both
jobs. In Judge Walker’s words, “This refusal was the catalyst, along with a general
pastiche of conflicting personality types.
. .” Riley pulled off both jobs and sent final bills. Bond refused to pay
another dime. Riley recorded liens on both properties and filed suit to collect.
Bond counter-sued, claiming faulty workmanship, late completion and violation of
Maine’s Home Construction Contract Act.
At trial, the question was, “Who breached
the contract, Riley or Bond?” The first to commit a material breach of contract
is liable for damages. A material breach of contract is any "non-performance
of a duty that is so material and important as to justify the injured party in regarding
the whole transaction as at an end." Judge Walker concluded that Bond's failure
to pay any amount on the final condo invoice was a material breach of contract.
The only other issue was the amount to be awarded Riley in damages.
Riley was ready. He had the contracts,
estimates, material receipts and time cards. Bond claimed Riley’s bills were inflated.
The court found otherwise. Riley’s charges were “reasonable, necessary and customary”
and supported by testimony at trial. The court awarded Riley $10,690.98 for Sebago,
$8,062 for the condo plus interest and attorney fees, but less $300 for the last
day of work on the condo.
Take-Aways from Riley v. Bond
Disputes are inevitable, especially on
work in older buildings. So make a few precautions part of your business practice.
It paid off for Riley and could for you too:- Caution
that there could be extras.
- Include
payment for extras in your contract.
- Keep
good job records.
- Be
ready to sue when nothing else works.
