Construction Claims Based on Contract or Quasi-Contract

posted by Michael Fortney  |  Dec 31, 2009 2:57 PM in Construction Law

Claims against contracting party

A subcontractor or materialman or prime contractor may bring a claim against the party it contracted with for breach of contract, including claims based on refusal to pay the contract price, refusal to pay for extra or changed work or materials, delay, or violation of the prompt payment laws.

To prevail, the subcontractor or materialman or prime contractor must establish the existence of a contract, performance of the contract, and breach of the contract by the contracting party. Damages for breach of contract are normally limited to the amount of money withheld. For extra or changed work, the damages are the reasonable value of the work performed. Damages under the prompt payment law would also include interest and attorneys fees.

Claims against owner

Claims against the owner by a lower tier contractor may be for foreclosure of mechanic's lien and for unjust enrichment.

Ohio courts have held that a claim for unjust enrichment will be upheld where a benefit has been conferred by a plaintiff on a defendant, the defendant has knowledge of the benefit and the circumstances are such that it would be unjust for the defendant to retain the benefit without compensation. Hambleton v. R.G. Barry Corp. (1984), 12 Ohio St. 3d 179, 183, 465 N.E.2d 1298. Liability under unjust enrichment "arises out of the obligation cast by law upon a person in receipt of benefits which he is not justly entitled to retain *** ." Hummel v. Hummel (1938), 133 Ohio St. 520, 525.

Unjust enrichment claims against an owner usually will not be upheld if the owner can demonstrate that it paid for the work done or materials supplied, even if the payment was not eventually made to the subcontractor or materialman.

Damages available

  • Value of changed or additional work
  • Money withheld
  • Delay damages

We hope you enjoy the photos on this page and find them interesting. The photos were taken by Peter Gostelow during a bicycle tour while in Tibet. You can see more of Peter's photos at www.petergostelow.com.

Contact Us

Michael Fortney Neil Klingshirn Joseph Spoonster
Michael Fortney
Construction Law, Employment and Labor Law, Business Law, Litigation, Arbitration

Articles

Statutory Independent Contractor Test Only Applies to Construction Workers Whether a worker is an "independent contractor" or an "employee" is an important and costly issue f ...
To Lien or Not to Lien - Do I Qualify for a Mechanic's Lien? We are often asked "Can I file a lien?" for some new and different issues - such as "Can I file a lien f ...
Could the United States Supreme Court Find that Title VII Prohibits Gender Identity and Sexual Orientation Discrimination? In Price Waterhouse , the Supreme Court held that Title VII reaches claims of “sex stereotyping.” As a resu ...
Right to Arbitrate Can Be Waived Two recent Ohio cases further clarify the right to arbitration in Ohio. A lien claimant wishing to preserve his rights ...
Ohio's Minimum Wage to Increase in 2015 Ohio's minimum wage will increase again in 2015. Ohio's minimum wage is tied to inflation and has risen every y ...