Where’s the Contract?

Paul and Andrea Bradford met with Michael Matott of Matott, Inc. to discuss an addition to the Bradford’s Penn Valley, Pennsylvania home. That was April 2019. Matott offered an estimate of between $102,000 and $136,000 for construction of a 750 square foot garage with storage above and a vestibule connecting the garage to the house. The Bradfords hired an architect to draw plans. The Bradfords and Matott signed a preliminary agreement and Matott applied for the permit. So far, so good.

Next Came the Surprises

The Township advised that a stormwater management plan would be required for the site. Plus, the Bradfords asked Matott. to replace old windows in the existing house with modern windows. Matott said stormwater management and new windows would add $26,000 to the job, bringing the total cost to $126,000. None of these changes were in writing.

Matott collected $88,000 to cover the cost of materials and started work on the foundation. A week into the job, Bradford and Matott met on site to discuss costs. After the meeting, Bradford added up what Matott expected to be paid for his work. It came to $296,112, more than double their original oral agreement. That was too much. Bradford told Matott to stop work and restore his property to original condition.

Matott came back with three options:

1. Build a smaller garage on the same foundation. Total cost $165,500.00.
2. Remove and bury the foundation. Total cost $108,000.00 plus additional labor and material costs.
3. Complete the job for an additional $140,500, bringing the Bradford’s total cost to $218,500.

In any case, Matott claimed an additional $33,345 for work completed so far. Bradford didn’t agree to anything Matott offered. So Matott abandoned the site.

While negotiations went on and on, water seeped into the Bradford’s basement, causing a mold problem. Eventually the Bradfords filed suit against both Micheal Matott and his corporation, claiming violation of Pennsylvania’s Home Improvement Consumer Protection Act (HICPA). Matott filed a counterclaim against the Bradfords for breach of contract.

Meanwhile, Bradford had another contractor complete a scaled-back version of the project – at a cost of $265,000.

At trial, the court concluded there was no valid and enforceable contract. Still, the Bradfords were awarded $128,982 in damages, costs, interest and attorney fees, The award was against Matott, Inc., not Micheal Matott as an individual. The trial court declined to award treble damages under HICPA.

The Bradfords appealed the trial court decision, insisting there was a valid contract. If so, they would be entitled to the benefit of their bargain – their cost of finishing the project.

The appellate court didn’t agree. In the opinion of the court, the job never had a firm contract price and had no clear scope of work. Matott’s estimate offered a range of prices for a smaller, simpler garage. The architectural plans showed a larger, more complete project. Under HICPA, an enforceable contract must include a description of the work, the materials to be used and a set of specifications that can’t be changed without a signed change order.

In a 43-page opinion, the appellate court sent the case back to the trial court with instructions to restore $30,000 in damages that should have been awarded to the Bradfords.

Takeaway from Bradford v. Matott

Elapse time from initial discussion of this project to appellate decision was 7 years, April 2019 to April 2026. Don’t let the same happen with your next project. Nearly everything that went wrong on the Bradford job could be traced to a single mistake: No valid contract. To be sure you have iron-clad agreements, get Construction Contract Writer. The trial version is free.