Summary of Opinion: Manuel J. Soares v. David Weitzman

Factual and Procedural Background

The plaintiff (a building contractor) brought an action against the defendant (the owner) in the Third District Court of Bristol, writ dated November 17, 1931, arising from construction of a house. The plaintiff sued in three counts: (1) breach of the building contract for failure to pay the balance of the contract price; (2) quantum meruit and quantum valebant for work, labor, and materials furnished; and (3) for extras supplied in the course of construction. The defendant answered and filed a declaration in set-off seeking damages for imperfect work. The case was tried in the District Court by Judge Milliken.

The District Court judge refused a defendant-requested ruling that certain contractual stipulations "are all substantial," found that the plaintiff had not fully performed the contract so as to recover on the first count, but awarded recovery on the second count (the unpaid balance less a reasonable deduction to make good defaults) and on the third count for extras actually done. The judge computed that if the contract had been perfectly performed $1,383.33 would have been due as the balance; $325.66 was due for extras; $361 was a reasonable sum to bring the completed work to contract standard; and, after deductions and interest, entered judgment for the plaintiff in the sum of $1,361.02 dated January 15, 1932. The judge reported the action to the Appellate Division for the Southern District; the Appellate Division found no reversible error and dismissed the report. The defendant appealed to the Supreme Judicial Court of Massachusetts.

Legal Issues Presented

Whether a defendant may recover damages for imperfect work by way of a declaration in set-off when the claim in set-off is not a liquidated demand (in light of G.L. (Ter. Ed.) c. 232, § 1).
Whether a contractor who has deliberately failed in any respect to perform a building contract is barred from recovering either on the express contract or on quantum meruit for work done.
Whether the trial judge erred as a matter of law in refusing the defendant's requested ruling that certain contractual stipulations were all substantial and in finding for the plaintiff on the second and third counts.

Arguments of the Parties

Defendant's Arguments

The defendant contended that the judge and the Appellate Division failed to apply the principle that a party who deliberately fails in any respect to perform a building contract cannot recover on the express contract or on quantum meruit.
The defendant also sought a ruling that the stipulations in the contract (door widths, joist placement, rafter size, plastering, painting, boiler, manner of doing the work) were all substantial, which the trial judge refused.

Plaintiff's Position (as reflected in the opinion)

The plaintiff proceeded on three counts and, as found by the trial judge, did not fully perform the contract (defeating count one) but performed substantially enough to recover on quantum meruit/quantum valebant for the balance due less a reasonable deduction to remedy defaults, and for extras that were found to have been actually done and properly charged.
There was evidence that certain extra work was done with an understanding between owner and builder that it would be paid for.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Taylor-Stites Glass Co. v. Manufacturers' Bottle Co. 201 Mass. 123, 125	That only liquidated demands may be the subject of set-off under G.L. (Ter. Ed.) c. 232, § 1.	The court relied on this authority to hold that the defendant had no right to recover on his declaration in set-off because the set-off claim was not a liquidated demand.
Glazer v. Schwartz, 276 Mass. 54	Summary of the principle that deliberate failure to perform a building contract bars recovery on the contract or on quantum meruit.	The court cited this case as a recent summary of the controlling principles and noted that those principles were not disputed; it used the principle as the legal backdrop for reviewing the judge's factual findings.
Smedley v. Walden, 246 Mass. 393	Authority relevant to cases of failure to perform; cited for comparison.	The court stated the present situation differs materially from Smedley and therefore the trial judge's factual conclusion that departures were not intentional was not unwarranted despite some evidence suggesting otherwise.

Court's Reasoning and Analysis

The court first addressed the set-off issue, applying G.L. (Ter. Ed.) c. 232, § 1 and the cited precedent (Taylor-Stites Glass Co.) to conclude that only liquidated demands can be set off; because the defendant's claim in set-off for imperfect work was not liquidated, the defendant had no right to recover by set-off. The court observed that the practical effect of the judge's deduction from the plaintiff's recovery approximated the relief the defendant sought, so the defendant did not suffer from the inability to set off unliquidated claims.

Turning to the principal dispute over recovery by the contractor, the court recognized the established rule (summarized in Glazer v. Schwartz) that a deliberate failure to perform a building contract in any respect bars recovery on the contract and on quantum meruit. The court reviewed the evidence, which was conflicting: there was evidence of numerous departures from contract requirements, including that certain floor supports and roof rafters were inches further apart on centers and rafters were smaller in dimension than called for, leaving timber unused — facts the court acknowledged are "difficult to reconcile" with an unintentional breach.

Nevertheless, the court held that the trial judge's factual findings — that the plaintiff's departures from the contract were not deliberately intended, that the plaintiff substantially performed, that certain extras were done with an understanding of payment, and specific monetary findings ($1,383.33 balance if perfect performance, $325.66 for extras, $361 reasonable to bring the work to contract standard) — were supported by conflicting evidence and therefore not unwarranted as a matter of law. The court treated the defendant's requested ruling that particular stipulations were all substantial as a request for a finding of fact rather than a legal rule, and appropriately refused it as a ruling of law. Because the other requested rulings were given and the judge applied the principles, the appellate courts found no reversible error.

Holding and Implications

Holding: The Supreme Judicial Court affirmed the Order of the Appellate Division dismissing the report. The court therefore affirmed the judgment for the plaintiff as computed by the trial judge.

Core Ruling: Order of Appellate Division dismissing report affirmed.

Implications: The direct effect is that the plaintiff's recovery, as found by the trial judge and summarized in the opinion, stands (judgment for $1,361.02 with interest as computed). The court clarified that unliquidated claims for damages to imperfect work cannot be recovered by set-off under G.L. c. 232, § 1. The opinion did not announce a new legal principle; it affirmed application of established doctrines to the facts and upheld the trial judge's factual determinations against the defendant's challenge.

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MANUEL J. SOARES vs. DAVID WEITZMAN.

Contract, Building contract, Implied. Practice, Civil, Findings by judge. Set-off.

It was stated that a landowner, the defendant in an action by a contractor for a balance due under a building contract, cannot recover damages for imperfect work under a declaration in set-off, because, under G.L. (Ter. Ed.) c. 232, § 1, only liquidated demands may be the subject of set-off. In an action in a district court for a balance due under a building contract, there was evidence that certain supports were substantially further apart, and certain rafters substantially smaller in dimension, than was required by the contract; that the completed work did not comply with the contract in numerous other respects, some of them of a serious nature; that the plaintiff performed the contract substantially; and that his departures therefrom were not intentional. The judge found for the plaintiff on a count in quantum meruit for the balance claimed by him, plus certain extras due, less a reasonable sum to bring the completed work to the standard required by the contract. Held, that (1) Although it was difficult to reconcile with the evidence a finding that the plaintiff's departures from the terms of the contract were unintentional, such a finding was not unwarranted; (2) There was no error of law in the finding for the plaintiff.

WAIT, J.

The plaintiff sued in three counts: the first for breach of a building contract by failure to pay the balance of the contract price; the second upon quantum meruit and quantum valebant for work and labor and materials furnished in building a house under a contract; the third for extras supplied in the course of such building. The defendant answered. He also filed a declaration in set-off for damages for imperfect work. The plaintiff did not demur. At a trial in a district court, the plaintiff failed on his first count because he had not himself performed fully the contract he had undertaken; he recovered on his second count the unpaid balance of the contract price less the reasonable expense of making good his defaults in his contract work, or, what here was, substantially, the same thing, the difference between the contract price of the building if constructed in strict compliance with the contract and the value of the building as actually constructed; he recovered on his third count the amount found due for such extra work as the judge found was actually done and properly charged for.

The defendant had no right to a recovery on his declaration in set-off, because one can properly set off only liquidated demands, G.L. (Ter. Ed.) c. 232, § 1, Taylor-Stites Glass Co. v. Manufacturers' Bottle Co. 201 Mass. 123, 125, and the claim in set-off was not on liquidated demands. He does not suffer, however, for the deduction made from the plaintiff's claim is practically what the set-off sought. The judge found for the plaintiff. On report the Appellate Division found no reversible error. The case is before us on appeal.

The defendant contends that there is error because both judge and Appellate Division failed to give effect to the principle of our law that one who has deliberately failed in any respect to perform a building contract cannot recover either on the express contract or on a quantum meruit for what he has done properly pursuant to the contract or in substantial compliance with it. There is no dispute in regard to the principles. They have been reiterated. See, for a recent summary, Glazer v. Schwartz, 276 Mass. 54. They need not be again stated here. In the case before us there was conflicting evidence which would justify findings that the completed work did not correspond with the contract in numerous respects, some of a serious nature; that, nevertheless, the departures were not deliberately intended failures to perform the work as undertaken; that substantially he performed the contract; that certain extra work was done with an understanding by owner and builder that it was to be paid for; that, if the contract had been perfectly performed, $1,383.33 would have been due as the balance of the purchase price; that $325.66 was due for extras; that $361 is a reasonable sum to bring the completed work to the contract standard; that deducting $361 from the total of the other items the plaintiff is entitled to $1,347.99 with interest from the date of the writ $13.03, and, therefore, to judgment in $1,361.02 on January 15, 1932.

There was evidence that supports for floors and rafters for roof were inches further apart on centers, and the rafters were smaller in dimension, than the contract called for, so that timber provided for the structure remained unused. This is difficult to reconcile with unintentional failure to live up to the contract; but we do not think we can say that the judge's conclusion was unwarranted in law as a consequence of the presence of this evidence. The situation differs materially from Smedley v. Walden, 246 Mass. 393. The ruling asked and not given involved a finding of fact which was not required as matter of law. There was no error in refusing it as a ruling of law. The other requests were given; and we cannot properly say that the judge did not in fact give full weight to the principles involved in them in his findings.

Our order must be

Order of Appellate Division dismissing report affirmed.

SOARES v. WEITZMAN