A Contractor That Intentionally and Materially Breaches Its Contract Is Not Precluded From Recovery Under Quantum Meruit; Massachusetts Supreme Court Overrules Century-Old Precedent Strictly Barring Such Relief

G4S Tech. LLC v. Mass. Tech. Park Corp., 2018 Mass. Lexis 357 (June 13, 2018)

A state development agency (the “Agency”), received state and federal funding to build a 1,200-mile fiber optic network.  It contracted with G4S Technology LLC (“G4S”) for the project under a $45.5 million design-build agreement.  As a result of project delays – the cause of which the parties disputed – G4S achieved final completion of the work more than one year after the contractual deadline.  Shortly after completion, the Agency issued a notice of withholding, claiming a right to withhold $4 million from G4S to compensate the Agency for delays and expenses incurred as a result of G4S’s alleged failures to perform.

G4S sued the Agency in Massachusetts Superior Court, asserting claims for breach of contract and quantum meruit.  It sought release of the contract balance plus an equitable adjustment of the contract price and deadlines.  In discovery, the Agency learned that G4S had repeatedly submitted inaccurate progress payment applications during the project, which falsely represented that G4S had timely paid its subcontractors.  The Agency cited this evidence in support of a motion for summary judgment, arguing that G4S’s conduct barred its right to recover money owed to it under the contract and under a theory of quantum meruit.  The Superior Court granted the motion, and G4S appealed. Continue reading “A Contractor That Intentionally and Materially Breaches Its Contract Is Not Precluded From Recovery Under Quantum Meruit; Massachusetts Supreme Court Overrules Century-Old Precedent Strictly Barring Such Relief”

Illinois Appellate Court Attempts to Draw the Line Between Contract and Quasi-Contract; Holds That Quantum Meruit Is Only Available Where Disputed Work is Outside the “General Subject Matter” of the Contract

Archon Construction Co. v. U.S. Shelter, LLC, 2017 Ill. App. LEXIS 197 (March 31, 2017)

U.S. Shelter, LLC, a developer, undertook to develop a new residential subdivision in Elgin, Illinois. As part of that project, U.S. Shelter retained Archon Construction Company, Inc. (“Archon”) to install the sanitary sewer system for $890,955.29.

Archon’s contract provided that after the system was completed, Archon would videotape the interior of the piping, to allow the City of Elgin (“City”) to inspect and determine the acceptability of the system as installed.

Archon completed its work in August of 2005. In early 2007, the City requested that Archon perform the required videotaping.  Archon complied.

After viewing the videotapes, the City announced that the system, as installed, was not acceptable and that certain repairs were necessary. In particular, the City specified that one of the lines running through the system needed to be replaced because of cracking, the existence of gravel in the lines, and other issues.  While the entire sewer system had been constructed with PVC pipe, the City directed that this line be replaced with ductile iron pipe. Continue reading “Illinois Appellate Court Attempts to Draw the Line Between Contract and Quasi-Contract; Holds That Quantum Meruit Is Only Available Where Disputed Work is Outside the “General Subject Matter” of the Contract”

Pennsylvania Supreme Court Holds Contractor May Recover in Quantum Meruit Where Home Improvement Contract Does Not Satisfy Statutory Requirements for Enforcement

Shafer Elec. & Constr. v. Mantia, 2014 Pa. LEXIS 1766 (Pa. July 21, 2014)

Homeowners Raymond and Donna Mantia contracted Shafer Electric & Construction (“Shafer”) to build a two-car garage addition onto their house. Shafer’s proposal was extremely detailed as to the work to be completed. Despite the detail in Shafer’s specifications, however, Shafer’s proposals did not comply with several requirements of the Home Improvement Consumer Protection Act, 73 P.S. §§ 517.1-517.18 (the “Act”). Specifically, pursuant to the Act, any home improvement contract must be legible, in writing, and satisfy thirteen other requirements. § 517.7(a). The contract satisfied only three of those requirements.

Notwithstanding the deficiencies, work began on the addition. During the subsequent months, a dispute arose concerning changes the Mantias made to the design of the addition. Other alterations became necessary as a result of excavation problems that arose during the work. The parties could not agree on a new contract, which Shafer believed was required due to the design changes. The parties agreed that Shafer would stop work and invoice the Mantias for the work it completed. When Shafer issued the final invoice, the Mantias refused to pay.

Continue reading “Pennsylvania Supreme Court Holds Contractor May Recover in Quantum Meruit Where Home Improvement Contract Does Not Satisfy Statutory Requirements for Enforcement”