290 A.3d 1108
Md. Ct. Spec. App.2023Background
- Patriot Construction subcontracted VK Electrical Services (VKES) for electrical work on an NSA Fort Meade project; subcontract contained written-change-order and pay-when-paid (owner payment as condition precedent) clauses.
- VKES performed additional "ticket" work (including fire-alarm work) in July 2016 without Patriot-signed change orders after being directed on-site by Patriot's project manager, Dwayne Spriggs, during an emergency.
- Patriot submitted two formal change orders for other work to the MPO; it did not submit the ticket invoices to the MPO and later received full payment from the MPO in October 2019.
- VKES repeatedly communicated with Patriot (emails 2016–2019) and was assured the work would be honored and submitted; VKES was first told Patriot would not pay the ticket work in April 2020.
- VKES sued in June 2020 for ~$64,577 (breach of contract, quantum meruit, unjust enrichment, and federal/State prompt-payment/trust-fund claims); bench trial resulted in judgment for VKES for $64,575.09.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether written-authorization condition precedent bars recovery | VKES: condition was waived by Patriot’s conduct and Spriggs had apparent authority | Patriot: VKES never obtained required written change orders, so condition precedent not satisfied | Court: Condition precedent waived; Spriggs had apparent authority and course of conduct excused requirement |
| When statute of limitations accrued given pay-when-paid clause | VKES: accrual deferred until Patriot was paid by MPO (Oct 2019), so suit timely | Patriot: accrual on completion of work (July 2016); suit filed in 2020 is time-barred | Court: Pay-when-paid delayed accrual; prevention doctrine applied—limitations began when Patriot received owner payment and refused to pay |
| Admission of parol evidence about subcontract scope | VKES: testimony not offered to vary written contract but to show work was outside base subcontract; Patriot later failed to preserve objections | Patriot: contract unambiguous; parol evidence was inadmissible | Court: Issue waived by Patriot’s failures to object consistently; need not reach parol-rule merits |
| Compliance with Md. Rule 2-522(a) (bench trial explanation) | Patriot: trial court gave insufficient factual/legal reasons; remand for new trial needed | VKES: trial court adequately stated reasons on record | Court: Rationale, though concise, met Rule 2-522(a); no reversible error |
| Denial of pretrial motion to dismiss for failure to state claim | VKES: pleadings adequately alleged satisfaction or waiver of conditions; statute-of-limitations defense depends on disputed facts | Patriot: complaint conclusory; should have been dismissed pretrial | Court: Denial proper—questions of fact (waiver, accrual) made dismissal premature; trial resolved merits |
Key Cases Cited
- Richard F. Kline, Inc. v. Shook Excavating & Hauling, Inc., 165 Md. App. 262 (waiver/modification of contract may be shown by subsequent conduct)
- Dickerson v. Longoria, 414 Md. 419 (apparent authority can bind principal to agent’s acts)
- WSC/2005 LLC v. Trio Ventures Assocs., 460 Md. 244 (prevention doctrine: one party’s conduct that hinders condition precedent may excuse nonoccurrence)
- Kumar v. Dhanda, 426 Md. 185 (test for accrual: when plaintiff could first successfully maintain action)
- Mayor & Council of Federalsburg v. Allied Contractors, Inc., 275 Md. 151 (when contractual condition precedents delay accrual of recovery)
- Clickner v. Magothy River Ass’n Inc., 424 Md. 253 (appellate standard of review for bench trials)