Wednesday, December 18, 2013

United States v. Algernon Blair, Inc. case brief

United States v. Algernon Blair, Inc. case brief summary
479 F.2d 638 (4th Cir. 1973)

Appellant sought review of a judgment of the United States Court for the District of South Carolina at Charleston, which determined that, while appellant had justifiably terminated its performance under contract, it was not entitled to recover damages.

After appellee refused to make payments for crane rental, appellant terminated its subcontractor agreement to perform steel erection in the construction of a naval hospital. The trial court determined that appellee had breached and that appellant was justified in ceasing performance; however, the trial court awarded no damages, concluding that while $37,000 was owed to appellant, appellant would have lost more than that figure if it had completed performance.


  • In reversing the matter, the court determined that because appellant provided, at its own expense, labor and equipment to appellee, who breached the subcontract and retained those benefits without paying for them, appellant was entitled to recover damages in quantum meruit, the value of the services provided. 
  • The judgment was reversed and the matter remanded for a determination of the reasonable value of labor and equipment use furnished by appellant to appellee.
The trial court's judgment was reversed, as appellant, a subcontractor ceasing work after contractor's breach, could recover in quantum meruit the value of labor and equipment furnished under the contract even though it would not have been entitled to recovery in a suit on the contract, and the matter was remanded for further proceedings.

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