Billy Williams Builders & Developers Inc. v. Hillerich
446 S.W.2d 280 (1969)
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Rule of Law:
A buyer of real estate is not required to elect between remedies and may simultaneously be awarded specific performance to compel the conveyance of property and monetary damages to compensate for deficiencies in quality (defective construction) and delays in performance.
Facts:
- Billy Williams Builders & Developers, Inc. (Williams) entered into a contract with the Hillerichs to sell a lot and construct a house on it according to 'submitted plans and specifications.'
- The Hillerichs sought this specific property in this particular neighborhood to be near their aged relatives.
- The contract stipulated a down payment of $6,300 but did not specify when it was to be made.
- Williams never demanded the down payment during negotiations or at the time the contract was signed.
- After construction, the Hillerichs alleged that the house was built defectively and that its completion was delayed.
Procedural Posture:
- The Hillerichs (plaintiffs) sued Williams (defendant) in a trial court with equity jurisdiction.
- The suit sought specific performance of the real estate contract, damages for defective construction, and damages for delay.
- The equity division of the trial court granted the Hillerichs' request for specific performance.
- The case was then transferred to the common law division of the trial court for a jury trial on the issue of damages.
- A jury returned a verdict for the Hillerichs, awarding $3,318 for defective construction and $910.38 for delay.
- The trial court directed a verdict for the Hillerichs on Williams' counterclaim.
- Williams (appellant) appealed the judgment to the Court of Appeals of Kentucky.
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Issue:
Does a buyer's election to seek the remedy of specific performance of a real estate contract preclude them from also recovering monetary damages for defective construction and delay in performance in the same action?
Opinions:
Majority - Judge Edward P. Hill
No. A buyer of real estate may be awarded both specific performance and damages for breach. The remedies are not inconsistent so as to require an election. The court reasoned that a vendee is entitled to receive the specific property for which they bargained, and if that property is deficient in quality or its delivery is delayed, they are also entitled to compensation for that partial breach. The court found no logical distinction between allowing an abatement in price for a deficiency in quantity (e.g., less acreage), which is well-established, and allowing damages for a deficiency in quality (e.g., defective construction). Citing Pomeroy's and the Restatement of Contracts, the court held that a vendor cannot use their own partial failure to perform as a defense against a purchaser willing to take the deficient property with compensation. Therefore, granting specific performance to convey the house and lot while also awarding damages for construction defects and delays was proper.
Analysis:
This decision clarifies Kentucky law by explicitly rejecting a strict application of the election of remedies doctrine in real estate contract disputes involving partial breach. The court establishes that specific performance (an equitable remedy) and damages for breach (a legal remedy) are not mutually exclusive and can be awarded together to give the non-breaching party the full benefit of their bargain. This holding is particularly significant for buyers of new construction, as it affirms their right to obtain the specific property they contracted for while also receiving compensation to correct defects or offset delays. The ruling aligns Kentucky with the modern trend of merging legal and equitable remedies to provide a more complete form of relief in a single action.
