Wednesday, December 18, 2013

Motel Services, Inc. v. Central Maine Power Co. case brief

Motel Services, Inc. v. Central Maine Power Co. case brief summary
394 A.2d 786 (1978)

Appellant developer sought review of a judgment entered by a trial court (Maine) in favor of appellee electric company in the contractor's action recover a promotional allowance from the electric company. The trial court also dismissed a third party action brought by the electric company against third-party defendant housing authority for return of the allowance in the event of a judgment in the contractor's favor.

The developer entered into an agreement with the housing authority whereby the developer agreed to build housing projects on a "turnkey" basis. After the agreement became effective, the developer asked to change the construction specifications to provide for an electrical rather than an oil heating system in order to qualify for a promotional allowance given by the electric company to the owner of a home built for the use of electricity as the primary method of heating. The authority agreed to the modification, although it was never informed of the promotional allowance. After 90 percent of the work was complete, the property was conveyed to the authority and the electric company sent the allowance to the authority.


  • On appeal, the court concluded that the housing authority was not entitled to the allowance. 
  • Not having known of the allowance prior to completion of construction, the authority did not bargain for the allowance and provided no consideration. 
  • In addition, the electric company received what it had bargained for.
The court sustained the appeal and remanded to the trial court with instructions to enter judgment for the developer on its claim against the electric company.

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