230 N.Y. 239
-Plaintiff was under contract with defendant to build a home using a specific type of pipe for all of the plumbing.
-Plaintiff did not use the pipe that was specified, but defendant did not complain about defective performance until the pipe was almost completely encased in the walls of the home.
-To replace the pipe, plaintiff would have had to tear down substantial parts of the completed structure.
-The plaintiff did not replace the pipe, and sought final payment.
-The trial court found in favor of defendant, and the appellate court reversed.
-The supreme court affirmed and directed verdict in favor of plaintiff because the plaintiff’s omission of the specified pipe was neither fraudulent nor willful, and the plaintiff was ready to present evidence proving that the pipe used was essentially identical to the specified pipe.
-In the end, plaintiff was due payment for substantial performance with compensation for the trivial defect.
-Defendant appealed the decision of the Appellate Division of the Supreme Court in the First Judicial Department (New York) reversing a directed verdict in favor of defendant and granting a new trial regarding plaintiff’s claim for payment due pursuant to a contract to build a home for defendant.
-An omission, both trivial and innocent, will sometimes be atoned for by allowance of the resulting damage and will not always be the breach of a condition to be followed by forfeiture. for damages in construction contracts, the owner is entitled merely to the difference between the value of the structure if built to specifications and the value it has as constructed.(aka market value)
-Courts don't say that one who makes a contract fills the measure of his duty by less than full performance. They do say, however, that an omission, both trivial and innocent, will sometimes be atoned for by allowance of the resulting damage, and will not always be the breach of a condition to be followed by a forfeiture The distinction is akin to that between dependent and independent promises, or between promises and conditions.
-Substitution of equivalents may not have the same significance in fields of art on the one side and in those of mere utility on the other. Nowhere will change be tolerated, however, if it is so dominant or pervasive as in any real or substantial measure to frustrate the purpose of the contract.
-Some promises are so plainly independent that they can never by fair construction be conditions of one another. Others are so plainly dependent that they must always be conditions. Others, though dependent, and, thus, conditions, when there is departure in point of substance, will be viewed as independent and collateral when the departure is insignificant. Considerations partly of justice and partly of presumable intention are to tell us whether this or that promise shall be placed in one class or in another.
-There is no general license to install whatever, in the builder’s judgment, may be regarded as “just as good.”
-The court must weigh the purpose to be served, the desire to be gratified, the excuse for deviation from the letter, the cruelty of enforced adherence. Then only can the court tell whether literal fulfillment is to be implied by law as a condition. -The transgressor whose default is unintentional and trivial may hope for mercy if he will offer atonement for his wrong.
-In most cases the cost of replacement is the measure. The owner is entitled to the money which will permit him to complete, unless the cost of completion is grossly and unfairly out of proportion to the good to be attained. When that is true, the measure is the difference in value.
-Reversal affirmed, and directed verdict entered in favor of plaintiff because plaintiff’s omission of specified pipe was neither fraudulent nor willful and the pipe used was essentially identical to the specified pipe.
-Plaintiff is due payment for substantial performance with compensation for the trivial defect.