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STATE OF MAINE SUPERlOR COURT CUMBERLAND, SS. CIVIL ACTION DOCKET NO. CV-PORSC-13-326
RlLEY WOODWORKS LLC ) ) Plaintiff and Counterclaim ) Defendant, ) ) v. ) JUDGMENT ) CHRlSTOPHER BOND, SEBEGO LAKE, ) ROWING AND SAILING CLUB, LLC, ) ) Defendants and Counterclaim ) Plaintiffs ) )
This matter came before the court during the course of a jury-waived trial. The parties
filed post-trial briefs on January 26, 2016 . The court has carefully considered the evidence
presented by the parties and adjudges as follows .
I. FACTS
The parties ' dispute involves competing allegations of a breach of contract. The parties
consummated two contracts. 1 One contract involved the promise by Plaintiff to perform certain
renovations, improvements and alterations to a structure owned by Defendants Bond and Sebago
Rowing, located in Standish, Maine . During the trial, this property was commonly referred to by
the parties as the "Sebago Project." The second contract involved renovation work to be
performed on a condominium owned by Christopher Bond, located in South Portland, Maine and
to which the parties have referred as the "Harborplace Project." For purposes of analytical
clarity, the court examines the two contracts in chronological succession.
1 Mr. Bond contends that these contracts should be considered a single contract. There was nothing in the record to support such a conclusion. The two projects involved distinctly different properties and involved equally different contractual agreements . ( (
Riley submitted several iterations of estimates, outlining time and material to complete
certain renovations on the Sebago property . Riley estimated the Sebago cost at $26,781.19; the
sum of labor ($16,327) and materials ($10,454.19) . Riley and Bond signed the Sebago contract
on November 28, 2012. Bond inserted the total estimate figure in handwriting on the contract
and scribbled through the provision that reduced the figure into separate estimated time and
materials. Bond also attempted to delete the merger clause and attached the revised estimate as
part of the contract, which itself reflected the estimated time and materials.
The Sebago project involved an older building that was in exceptionally poor repair.
Riley testified that this is precisely the type of project that requires a baseline estimate but that
often involve unforeseen difficulties, such that require the scope of work to change. Such was in
fact the case with the Sebago property. Riley disclosed to Bond the issues presented by the old
structure, such as rotted floor joists and subfloor and outdated electrical systems. Bond agreed to
have Riley address those issues with the attendant increased cost to do so. Riley continued the
work on the Sebago proj ect.
In January 2012, Bond asked Riley to renovate Harborplace. Riley and Bond signed the
contract, which consisted of a host of handwritten estimates. Bond placed some urgency on the
Harborplace project and as such, asked Riley to make it a priority. As with the Sebago project,
Bond requested a number of changes and extras to the Harborplace project that delayed its
completion.
Riley had substantially completed the work to Harborplace by March 27, 2013. Riley
requested final payment of $6,674, plus payment for the extra work he performed. Bond
conceded at trial that he owed Riley this sum, but refused payment because the remaining extra
work required an additional day to complete. This refusal was the catalyst, along with a general
2 (
pastiche of conflicting personality types, to Bond's letter of March 28, 2013 to Riley, instructing
Riley to stop work on both projects. Riley complied, leaving both job sites. A final demand
from Riley to Bond for payment related to the Sebago project was memorialized in a letter dated
May 23 2013 . Bond refused payment of any kind, nature and amount for both projects. Riley
recorded liens on both properties and this action ensued.
The material facts were not generally in dispute and are not particularly complex, despite
the parties' consuming efforts to characterize these facts . This is not entirely unique in such
small construction contract disputes, but perhaps more overwrought here than typically is the
case.
Plaintiffs Exhibits 15-17 support actual costs of the Sebago and Harborplace projects,
including the amount paid by Bond. Riley testified and the court finds that the labor costs were
reasonable, necessary and customary. Mr. Bond did not at trial dispute the labor costs related to
Harborplace. As for Sebago, Mr. Bond challenges those labor costs that exceeded the estimated
cost pointing out for what evidentiary value it has, that Mr. Bond did not memorialize the labor
increases. The labor costs in dispute are for demolition, foundation, roofing, electrical, plumbing
and painting. The tally of these above-estimate costs is $8,908.00. Mr. Bond disputes these
costs as being presented through a final invoice after the unhappy dissolution of the business
relationship between the parties. As such, Mr. Bond urges the court to discredit the accuracy of
these costs as reflecting nothing more than inflated charges that were motivated by Mr. Riley's
anger toward Mr. Bond. The court declines to adopt that characterization and finds the above-
estimated costs for work actually performed by Mr. Riley to be supported by the balance of the
record, to include Plaintiffs Exhibit 15 and testimony by Mr. Riley and supporting time cards.
3 (
Defendants assert counterclaims for breach of contract in the form of faulty workmanship
and untimely completion, violations of the Home Construction Contract Act, and Unfair Trade
Practices Act.
II. Conclusions
In order to prevail on the contract claims, the parties must prove (1) breach of a material
contract term; (2) causation; and (3) damages. See Me. Energy Recovery Co. v. United Steel
Structures, Inc., 1999 ME 31, p 7, 724 A.2d 1248.
A material breach of contract "is a non-performance of a duty that is so material and important as
to justify the injured party in regarding the whole transaction as at an end." Jenkins, Inc. v. Walsh
Bros., Inc., 2001 ME 98, P 13, 776 A.2d 1229, 1234 (quotation marks omitted); see also Forrest
Assocs. v. Passamaquoddy Tribe, 2000 ME 195 , P 9, 760 A.2d 1041, 1044 (stating that "whether
a breach has occurred ... [is a] question[] of fact").
The ineluctable conclusion is that Mr. Bond's failure to pay any amount toward the
Harborplace invoice constituted a material breach of contract. Mr. Bond 's argument that he did
not yet owe the balance because work remained at Harborplace, estimated to have constituted
one day, is of no moment to the legal analysis . Riley 's testimony that all contractual work was
completed is credible and that whatever "extra" work remained should not have formed the basis
for Mr. Bond to fail to pay any amount whatever.
Mr. Bond' s demand that Riley stop work on both jobs on March 28 , 20 13 (Plaintiff's
Exh. 12) constituted a material breach of the Sebago contract, insofar as that did not absolve Mr.
Bond fro m the outstanding amounts owed on the contract and was merely a reaction to Riley's
March 27 demand for payment on the projects.
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( (
STATE OF MAINE SUPERlOR COURT CUMBERLAND, SS. CIVIL ACTION DOCKET NO. CV-PORSC-13-326
RlLEY WOODWORKS LLC ) ) Plaintiff and Counterclaim ) Defendant, ) ) v. ) JUDGMENT ) CHRlSTOPHER BOND, SEBEGO LAKE, ) ROWING AND SAILING CLUB, LLC, ) ) Defendants and Counterclaim ) Plaintiffs ) )
This matter came before the court during the course of a jury-waived trial. The parties
filed post-trial briefs on January 26, 2016 . The court has carefully considered the evidence
presented by the parties and adjudges as follows .
I. FACTS
The parties ' dispute involves competing allegations of a breach of contract. The parties
consummated two contracts. 1 One contract involved the promise by Plaintiff to perform certain
renovations, improvements and alterations to a structure owned by Defendants Bond and Sebago
Rowing, located in Standish, Maine . During the trial, this property was commonly referred to by
the parties as the "Sebago Project." The second contract involved renovation work to be
performed on a condominium owned by Christopher Bond, located in South Portland, Maine and
to which the parties have referred as the "Harborplace Project." For purposes of analytical
clarity, the court examines the two contracts in chronological succession.
1 Mr. Bond contends that these contracts should be considered a single contract. There was nothing in the record to support such a conclusion. The two projects involved distinctly different properties and involved equally different contractual agreements . ( (
Riley submitted several iterations of estimates, outlining time and material to complete
certain renovations on the Sebago property . Riley estimated the Sebago cost at $26,781.19; the
sum of labor ($16,327) and materials ($10,454.19) . Riley and Bond signed the Sebago contract
on November 28, 2012. Bond inserted the total estimate figure in handwriting on the contract
and scribbled through the provision that reduced the figure into separate estimated time and
materials. Bond also attempted to delete the merger clause and attached the revised estimate as
part of the contract, which itself reflected the estimated time and materials.
The Sebago project involved an older building that was in exceptionally poor repair.
Riley testified that this is precisely the type of project that requires a baseline estimate but that
often involve unforeseen difficulties, such that require the scope of work to change. Such was in
fact the case with the Sebago property. Riley disclosed to Bond the issues presented by the old
structure, such as rotted floor joists and subfloor and outdated electrical systems. Bond agreed to
have Riley address those issues with the attendant increased cost to do so. Riley continued the
work on the Sebago proj ect.
In January 2012, Bond asked Riley to renovate Harborplace. Riley and Bond signed the
contract, which consisted of a host of handwritten estimates. Bond placed some urgency on the
Harborplace project and as such, asked Riley to make it a priority. As with the Sebago project,
Bond requested a number of changes and extras to the Harborplace project that delayed its
completion.
Riley had substantially completed the work to Harborplace by March 27, 2013. Riley
requested final payment of $6,674, plus payment for the extra work he performed. Bond
conceded at trial that he owed Riley this sum, but refused payment because the remaining extra
work required an additional day to complete. This refusal was the catalyst, along with a general
2 (
pastiche of conflicting personality types, to Bond's letter of March 28, 2013 to Riley, instructing
Riley to stop work on both projects. Riley complied, leaving both job sites. A final demand
from Riley to Bond for payment related to the Sebago project was memorialized in a letter dated
May 23 2013 . Bond refused payment of any kind, nature and amount for both projects. Riley
recorded liens on both properties and this action ensued.
The material facts were not generally in dispute and are not particularly complex, despite
the parties' consuming efforts to characterize these facts . This is not entirely unique in such
small construction contract disputes, but perhaps more overwrought here than typically is the
case.
Plaintiffs Exhibits 15-17 support actual costs of the Sebago and Harborplace projects,
including the amount paid by Bond. Riley testified and the court finds that the labor costs were
reasonable, necessary and customary. Mr. Bond did not at trial dispute the labor costs related to
Harborplace. As for Sebago, Mr. Bond challenges those labor costs that exceeded the estimated
cost pointing out for what evidentiary value it has, that Mr. Bond did not memorialize the labor
increases. The labor costs in dispute are for demolition, foundation, roofing, electrical, plumbing
and painting. The tally of these above-estimate costs is $8,908.00. Mr. Bond disputes these
costs as being presented through a final invoice after the unhappy dissolution of the business
relationship between the parties. As such, Mr. Bond urges the court to discredit the accuracy of
these costs as reflecting nothing more than inflated charges that were motivated by Mr. Riley's
anger toward Mr. Bond. The court declines to adopt that characterization and finds the above-
estimated costs for work actually performed by Mr. Riley to be supported by the balance of the
record, to include Plaintiffs Exhibit 15 and testimony by Mr. Riley and supporting time cards.
3 (
Defendants assert counterclaims for breach of contract in the form of faulty workmanship
and untimely completion, violations of the Home Construction Contract Act, and Unfair Trade
Practices Act.
II. Conclusions
In order to prevail on the contract claims, the parties must prove (1) breach of a material
contract term; (2) causation; and (3) damages. See Me. Energy Recovery Co. v. United Steel
Structures, Inc., 1999 ME 31, p 7, 724 A.2d 1248.
A material breach of contract "is a non-performance of a duty that is so material and important as
to justify the injured party in regarding the whole transaction as at an end." Jenkins, Inc. v. Walsh
Bros., Inc., 2001 ME 98, P 13, 776 A.2d 1229, 1234 (quotation marks omitted); see also Forrest
Assocs. v. Passamaquoddy Tribe, 2000 ME 195 , P 9, 760 A.2d 1041, 1044 (stating that "whether
a breach has occurred ... [is a] question[] of fact").
The ineluctable conclusion is that Mr. Bond's failure to pay any amount toward the
Harborplace invoice constituted a material breach of contract. Mr. Bond 's argument that he did
not yet owe the balance because work remained at Harborplace, estimated to have constituted
one day, is of no moment to the legal analysis . Riley 's testimony that all contractual work was
completed is credible and that whatever "extra" work remained should not have formed the basis
for Mr. Bond to fail to pay any amount whatever.
Mr. Bond' s demand that Riley stop work on both jobs on March 28 , 20 13 (Plaintiff's
Exh. 12) constituted a material breach of the Sebago contract, insofar as that did not absolve Mr.
Bond fro m the outstanding amounts owed on the contract and was merely a reaction to Riley's
March 27 demand for payment on the projects. There was no evidence that Riley abandoned the
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job. To the contrary, the evidence supports the conclusion that Mr. Bond's stop-work demand
was honored by Riley.
Mr. Bond's claims for breach of contract come in two forms; to wit, that Riley failed to
complete the work on Sebago by the date in the contract, and that Riley's workmanship was
faulty. As for the second claim for shoddy workmanship fails simply bec~use there was no
admissible evidence supported by expert testimony, or otherwise, that Riley's work failed to
meet a particular building practice standard. Moreover, "[w]hether time is of the essence in a
contract is a matter of fact[ .]" Raisin Mem'l Trust v. Casey, 2008 ME 63, P 21, 945 A.2d 1211.
The absence or presence of "time is of the essence" language is not dispositive and courts
consider the "nature, circumstances, and purpose of the contract to determine whether time is of
the essence." Id.; see W.G. Ambrose Enters, v. Keefe, 2009 Me. Super. LEXIS 136, at *7 (Sept.
23, 2009); see Frost v. Barrett, 246 A.2d 198, 201 (Me. 1968).
Moreover, "a rule of reasonableness is appropriate." 14 Powell on Real Property § 81.03(5)
(2005); see Me. Mut. Fire Ins. Co. v. Watson, 532 A.2d 686, 689 (Me. 1987) ("When no time for
performance is specified in the contract, a 'reasonable time' is implied.").
The Sebago contract did not contain "time is of the essence" language, and nothing in the
record supports a different conclusion by the court based on the nature, circumstances and
purpose of the contract. Given the unforeseen circumstances that attend these types of
renovations, and that did in fact attend the Sebago project, the time taken to perform the work at
the Sebago project by Riley was reasonable under the circumstances and did not constitute a
breach, much less a material breach of contract.
Mr. Bond presents counterclaims for violations of the Home Construction Contract Act
and Unfair Trade Practices Act. Both claims fail. The subject properties were commercial
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properties and therefore do not fall within the scope of the HCCA. Because violation of the
HCCA is the predicate upon which the claim for UTPA rests, the latter claim fails by extension.
Riley 's damages proximately caused by Defendants' failure to pay are consistent with
Plaintiffs Exhibits 15-17. As such the court awards Plaintiff damages in the amount of
$18,753 .69. The remaining question is whether the court should impose penalties and costs in
keeping with the Prompt Payment Act.
The prompt payment statute, 10 M.R.S. §§ 1111-1120, imposes penalties against
owners, as well as contractors, who do not make payments in a timely fashion. These statutory
penalties act as "disincentives to withholding amounts due," and are "intended to augment
damages that are traditionally available for contract or quantum meruit claims."
A finding that an owner breached a construction contract does not necessarily entitle a
contractor to the remedies provided by the prompt payment statute. See Jenkins , 2001 ME 98, P
31, 776 A.2d at 1239. Instead, the availability of prompt payment remedies depends upon
whether payment has been "wrongfully withheld." See 10 M.R.S. § 1118(3). Guiding this
determination is 10 M.R.S. § 1113, which sets forth several principles governing the payment
obligations between owners and contractors. First, payment must be made "strictly in
accordance with the terms of the construction contract." 10 M.R.S. § 1113(1) . Second, "the
contractor may invoice the owner for progress payments at the end of the billing period, "
provided that the parties' contract does not include a provision governing the terms of payment.
10 M.R.S. § 1113(2). Finally, except as otherwise agreed, payment is "due from the owner 20
days after the end of the billing period or 20 days after delivery of the invoice, whichever is
later." 10 M.R.S. § 1113(3). Unless an owner has a valid excuse for nonpayment, see 10 M.R.S .
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§ 1118(1 ), (3), payments not rendered within this time frame are considered wrongfully
withheld.
If payment has been wrongfully withheld, available remedies include prejudgment interest,
a one percent monthly penalty on amounts wrongfully withheld, and attorney fees. See 10
M.R.S. §§ 1113(4), 1118(2), 1118(4). Regarding interest, if an owner fails to pay within the time
period specified by section 1113(3), "the owner shall pay the contractor interest on any unpaid
balance due beginning on the 21st day, at an interest rate equal to that specified in Title 14,
section 1602-C." 10 M.R.S. § 1113(4) . With regard to penalties, the amount to be awarded is
"equal to 1% per month of all sums for which payment has wrongfully been withheld." 10
M.R.S. § 1118(2). In order to properly calculate interest and penalties, reference must be made
"to the specific amounts owed and the dates by which they should have been paid." Jenkins,
2001 ME 98, P 27, 776 A.2d at 1238.
The court concludes that Defendants wrongfully withheld a portion of the sums reflected
on the final invoice for Harborplace ($8,062.71) and Sebago ($10,690.98). Defendants' failure
to pay for the remaining day of labor on Harborplace reflected the amount of work · not yet
performed. The court finds that amount to be $300. Likewise, Defendants' failure to pay $3,340
in labor increases on the Sebago property did not violate the Prompt Pay Act because Plaintiff
did not provide any supports for that amount until some point during the discovery period.
The court awards to Plaintiff the following:
1. The final payment for work performed at Harborplace, less the one day of labor left to
complete the project when Defendants terminated the contract, which is $8,062.71 -
$300 = $7,732.71, plus interest to accrue beginning on April 20, 2013 at an interest rate
7 equal to that specified in Title 14, section 1602-C, plus a penalty of interest of 1% per
month, plus reasonable attorneys fees and court costs.
2. The final payment for work performed at Sebago, which is $10,690.98. However, for
purposes of calculating interest, penalties and fees under the Prompt Pay Act, Plaintiff is
awarded interest, penalties and attorneys fees based on the forego ing sum less the
$3,340 in labor increases which formed a reasonable claim or defense by Defendants2,
which is 7,3 50.98. As to this net sum, statutory interest to accrue beginning on June 12,
2013 at an interest rate equal to that specified in Title 14, section 1602-C, plus a penalty
of interest of 1% per month, plus reasonable attorneys fees and court costs.
3. Plaintiffs counsel shall file with the court a detailed attorneys fees affidavit within 14
days from the date of this Order. Defendants may file an opposition to Plaintiffs
request for attorneys fees within 7 days from the filing of Plaintiffs affidavit.
The Clerk is directed to enter this Order on the civil docket by reference pursuant to
Maine Rule of Civil Procedure 79(a).
Date: March 3, 2016
2 The court u ltimately has found that the evidence at trial supported this labor cost invoiced by Plaintiff. Such a finding does not preclude the court's finding that the labo r cost, at the time, fo rmed a basis for Defendants to withhold that sum .