Kirkland v. Archbold
68 Ohio Law. Abs. 481 (1953)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A contractor who materially breaches a construction contract may recover in quantum meruit for the reasonable value of the benefits conferred upon the other party, diminished by the damages the other party sustained as a result of the breach.
Facts:
- A plaintiff contractor and a defendant homeowner entered into a written contract for alterations and repairs to the defendant's dwelling for a total price of $6,000.
- The contract specified that all outside walls were to be lined with rock wool and rock lathe before plastering.
- The agreement included a progressive payment schedule, with the first $1,000 due after ten days of satisfactory work.
- The defendant paid the plaintiff $800 of the first installment.
- A dispute arose when the plaintiff attempted to plaster the house before installing the contractually required rock wool and rock lathe.
- Citing the plaintiff's failure to follow the contract's specifications, the defendant's agent forceably ejected the plaintiff from the property, preventing further work.
Procedural Posture:
- The plaintiff contractor sued the defendant homeowner in the trial court for damages.
- The case was tried by a judge without a jury, primarily at the location of the house being repaired.
- The trial court found that the plaintiff breached the contract but, deeming the payment provisions severable, awarded the plaintiff $200.
- The plaintiff appealed the judgment to this intermediate appellate court, claiming the amount of damages awarded was inadequate.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does a contractor who is found to be in material breach of an entire, non-severable construction contract have a right to recover for the value of the work and materials provided before the breach?
Opinions:
Majority - Skeel, PJ.
Yes, a contractor who breaches a contract may still recover for the value of the benefits conferred. The court rejected the trial court’s finding that the contract was severable, holding that a contract for a total scope of work for a total price is an entire contract, and a payment schedule does not alter this. While older Ohio case law would bar recovery for a party in default, the court adopted the modern rule based on the theory of unjust enrichment, as established in cases like Britton v. Turner. This rule prevents the harsh forfeiture that occurs when a property owner retains the value of significant labor and materials without payment. Therefore, a defaulting contractor is entitled to recover the reasonable value of the work performed on a quantum meruit basis, less any damages the owner incurred due to the contractor's breach. The court also held that the trial court committed a procedural error and abused its discretion by conducting the trial almost entirely at the construction site instead of in a proper courthouse, making a complete record for review impossible.
Analysis:
This decision marks a significant shift in Ohio contract law, moving away from the traditional, rigid rule that a party who materially breaches a contract can recover nothing. By adopting the doctrine of quantum meruit in the context of construction contracts, the court embraces a more equitable approach focused on preventing unjust enrichment. This precedent allows for more flexible and fair outcomes, ensuring a breaching party is not excessively penalized by forfeiting all compensation for work that has benefited the non-breaching party. However, it also introduces more complexity in litigation, requiring courts to precisely value the benefit conferred and calculate the owner's offsetting damages.
Unlock the full brief for Kirkland v. Archbold