2004 Ohio 6275 | Ohio Ct. App. | 2004
{¶ 3} Under the terms of the contract, appellant would pay appellee one-half ($7,403.00) of the total contract price of $14,806.00 upon completion of the "rough" work and one-half ($7,403.00) upon completion of the project. There is no dispute that the "rough" work was completed and that appellant made the first payment. The dispute involves whether the project was substantially completed before appellee stopped work such that it was entitled to the second payment.
{¶ 4} Appellee ceased work when the parties' relationship deteriorated after appellant changed the project from one containing an unfinished basement to one for a finished basement and included a large room addition. Appellee informed appellant that the existing H.V.A.C. plans contained in the contract were not sufficient for the added square footage in the house. There is a dispute regarding whether appellee timely performed the work and whether appellant requested appellee to cease performing any work or appellee stopped work on its own.
{¶ 5} Appellant has not paid any part of the final $7,403.00. Appellee claims that it substantially performed its obligations under the contract and billed appellant $5,958.00 on January 17, 2002. Appellee filed suit against appellant alleging breach of contract. Later, appellee filed an amended complaint and appellant counterclaimed.
{¶ 6} The trial court held a hearing and found that appellee had substantially performed the work it had contracted to perform. The court found that ninety percent of the work was completed by the time appellee stopped working. Consequently, the trial court awarded appellee ninety percent of the second billing in the amount of $5,276.70. The court also found that appellee may not have been reasonable in stopping work due to a letter from appellant's counsel inquiring as to its intentions regarding completing the work. Appellee timely appealed from the trial court's judgment, setting forth three assignments of error for review.
{¶ 7} This Court's determination on Assignments of Error II and III render this Assignment of Error moot.
{¶ 8} This Court will consider these Assignments of Error together.
{¶ 9} Whether a party has substantially performed under the terms of a contract is a question of fact. Marinich v. Bush
(Dec. 30, 1999), 12th Dist. Nos. CA99-01-011 and CA99-01-018, citing Volak v. Henderson (July 19, 1995), 9th Dist. No. 94CA005815, citing Jacob Youngs v. Kent (1921),
{¶ 10} In this case, the trial court found that appellee performed ninety percent of the work required and therefore had substantially performed the contract
{¶ 11} Appellant argued that this finding is incorrect. It argued that appellee did not substantially perform its obligations under the contract. Appellant cited the case ofCleveland Neighborhood Health Serv., Inc. v. St. Clair Builders,Inc. (1989),
{¶ 12} At the hearing, appellant produced evidence from Echols Heating and Air Conditioning ("Echols"), another H.V.A.C. subcontractor hired to complete the unfinished work. Echols testified that it would cost approximately $5,000.00 to finish the work. Echols also testified that completing the work of another contractor was often more expensive than under the original contract.
{¶ 13} Appellant's calculations established that appellee had completed only two thirds of the job as measured by the method used in St. Clair Builders. Appellant reached this two thirds figure by taking the amount needed to complete the work ($5,000.00) and dividing it by the total amount of the contract ($14,806.00) [$14,806 (contract amount) divided by $5,000.00 (amount to complete job by Echols) = one third unfinished.] Appellant claimed that two thirds completion of a contract cannot be considered substantial performance. As a result, appellant argued that appellee should not have been awarded anything.
{¶ 14} Appellee argued that the trial court properly applied the St. Clair Builders' standard in determining that it had substantially performed the contract. Appellee based its computations on the amounts provided in the contract, and not what it would actually cost appellant to complete the project, to determine what percentage of the contract remained unperformed. Appellee claimed that only approximately $1,500.00 was needed to complete the contract. Under appellee's computation, it had substantially performed by contact by performing ninety percent of its obligations. ($14,806.00 [total contract price] divided by $1,500.00 [cost under contract to complete work] = ninety percent.)
{¶ 15} The issue in this case is whether the contract amount or the actual amount to complete the contract should to be used to determine whether a party has substantially performed its obligations under a contract. The trial court applied the contract price.
{¶ 16} This Court finds, however, that the proper method to determine damages is the reasonable cost to complete the project; that is, to place the building in the condition contemplated by the parties at the time the parties entered into the contract.Sites v. Moore (1992),
{¶ 17} In this case, appellant provided unrefuted evidence that the reasonable cost of placing the residence in the condition contracted for by both parties was $5,000.00. Using this computation, appellee had not substantially performed. "Substantial performance" is defined as to mean that "mere nominal, trifling, or technical departures are not sufficient to breach a contract, and that slight departures, omissions and inadvertencies should be disregarded." St. Clair Builders
{¶ 18} We find that the trial court did not have sufficient evidence to conclude that appellee substantially performed its obligations under the contract. When a party fails to substantially perform, it is not entitled to damages. Miller v.Bealer (1992),
{¶ 19} In its third assignment of error, appellant argued that the trial court erred in using the contract price, and not the actual cost, in computing damages. This Court addressed the proper measure of damages.
Judgment reversed and cause remanded.
The Court finds that there were reasonable grounds for this appeal.
We order that a special mandate issue out of this Court, directing the Akron Municipal Court, County of Summit, State of Ohio, to carry this judgment into execution. A certified copy of this journal entry shall constitute the mandate, pursuant to App.R. 27.
Immediately upon the filing hereof, this document shall constitute the journal entry of judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the period for review shall begin to run. App.R. 22(E). The Clerk of the Court of Appeals is instructed to mail a notice of entry of this judgment to the parties and to make a notation of the mailing in the docket, pursuant to App.R. 30.
Costs taxed to Appellee.
Exceptions.
Slaby, P.J., Batchelder, J., Concur.
(Baird, J., retired, of the Ninth District Court of Appeals, sitting by assignment pursuant to, § 6(C), Article IV, Constitution.)