The opinion
STATE OF MAINE SUPERIOR COURT
PENOBSCOT, SS. CIVIL ACTION
DOCKET NO CV-07-391
. p r;;,J - -, -.
MARY ADDISON,
Plaintiff,
v. DECISION and JUDGMENT
EUGENE DAIGLE,
Defendant.
Hearing was concluded and briefs filed by October 5, 2009. The plaintiff was
present and represented by counsel, Joseph Ferris, Esq., while the defendant was
present and represented by counsel, James Munch, Esq. The Court will address all
issues raised in the analysis that follows.
A. COUNT I
1. Existence of a Written Contract
This lawsuit arises from defendant's construction of a home for plaintiff in 2006.
Her prior residence had been destroyed by fire in March of 2006 and she explored
options to replace it. She found a set of plans for a new home that seemed suitable and
located a builder, Andy Samaras, owner of Hammer-All Home Improvement who
agreed to build the home according to the plans. He provided her with a proposal, Pl.'s
Ex. #3, that quoted a price of $173,430, and it contained certain terms and conditions
that had to be completed before specified payments were due. The homeowner was
required to provide site work, foundation, septic system, water-line to existing well,
cellar floor, and painting. The second floor was to be unfinished except for heat,
plumbing, and drywall. Included in the proposal was a list of allowances, as well as a
list of building materials and related costs. Unfortunately, Mr. Samaras chose to build
another house instead of plaintiff's and Ms. Addison was faced with the prospect of
finding another builder, one who could complete the project by winter.
Ms. Addison worked at the University of Maine with the defendant, and spoke
with him frequently about the difficulties she had encountered in getting her house
built. She knew he worked as a computer systems administrator, but also was aware
that he bought and fixed properties and had construction knowledge. Mr. Daigle and
the plaintiff were friendly and he was concerned about her plight. Ms. Addison became
even more distressed after another potential builder backed out of the project and
eventually she and Mr. Daigle discussed whether he could provide assistance.
Although he was not a contractor, he was familiar with building procedures and
practices and knew an engineer, Mr. Manion, who could provide assistance. Defendant
indicated that he would consult with Mr. Manion and then decide whether he would
take on the project to assist the plaintiff. He eventually agreed to help.
Central to the Court's decision in this case is whether the terms of a construction
contract, Pl.'s Ex. #1, are binding on the parties. After agreeing to help, Mr. Daigle went
on-line to find a construction contract form and then proceeded to include the Samaras
contract terms in the new contract. Both agreements contained an agreement to build
the home according to the plans for $173,400 and included a similar schedule of
payments, and provided for an exclusion of foundation and site work from the contract.
The Samaras contract contained a list of allowances for certain expensive materials and
segments of construction such as drywall, plumbing, electrical, chimney, and the
homeowner was free to select materials within these allowances. The Daigle contract
had no list of allowances but specified that materials were to be specified by the
contractor and invoiced to the owner. Additionally, the Samaras contract provided that
the flooring would be the responsibility of the owner while flooring was included in the
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Daigle contract. Both parties agree that the Daigle contract was based on the Samaras
contract.
As construction progressed, Ms. Addison needed to borrow funds from a bank to
complete the project. The bank required that she have a contract in order to obtain the
funds. She indicated this need to Mr. Daigle, which prompted him to draft the contract
described above. He obviously gave no independent thought to the cost of the project,
did not price materials, and performed no labor cost estimates, but just adopted Mr.
Samaris' conclusions in this regard. As the summer progressed without a loan
authorization, the plaintiff told the defendant that the bank needed a list of costs and
the parties jointly prepared construction cost worksheets. Def.'s Ex. #1,2,3, and 4 were
prepared for this purpose and Def. Ex. #2 was submitted to the bank. The costs on the
worksheet included costs such as foundation and site work that were not included in
the parties' contract, and the parties obviously manipulated the entries in various
categories in order for the entire project to come in at the target price of $189,500.
Plaintiff asserts that the parties' obligations with regard to the construction of her
home are defined in the written contract dated June 20, 2010. Plaintiff also argues that
the parole evidence rule excludes consideration of extrinsic evidence offered to change
the terms of the written contract. In reply, the defendant argues that extrinsic evidence
is admissible to prove that the parties did not intend to be bound by the written
contract, which was only prepared because the bank that originated the construction
loan required that the parties have a contract. The Court agrees that parol evidence is
not admissible to vary, add to, or contradict the terms of an integrated written contract.
Clark v. DiPietro, 525 A.2d 623, 625 (Me. 1987). If the agreement is partially integrated,
extrinsic evidence will be admissible if the additional terms are consistent with the
written terms. Rogers v. Jackson, 2002 ME 140, <IT10, 804 A.2d 379, 381. Although the issue
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does not appear to be decided in Maine, the Court is also willing to rule that extrinsic
evidence is admissible on the issue of whether the parties intended to be bound by the
terms of a written contract. See, Am. Jur. 2nd Evidence § 1120; Corbin on Contracts §
85.19; Zamore v. Whitten, 395 A.2d 435, 440 (Me. 1998). After reviewing the evidence
admitted at hearing, the Court concludes that the parties intended to be bound by the
June 20,2010 agreement.
At the time of the agreement, the parties had been discussing the difficulties
plaintiff had encountered in having her home built. The defendant agreed to be
responsible for the construction of the home in order to help a friend. Since he wasn't a
contractor, he went to the internet to download a form contract and then incorporated
the Samaris terms into the form contract. Once he was assured of Manion's assistance,
he expressed confidence that he could build a better home than Samaris and felt
Samaris' price may have been high. Defendant knew plaintiff needed a contract in order
to obtain a loan from the bank and assisted in this regard, but there is no indication that
this was the sole reason for the contract to be drafted. There was absolutely no clear,
unequivocal agreement between the parties that the written contract was for financing
purposes only and not to be enforced. In the absence of an overt agreement that the
written contract would not be enforceable, it is difficult to believe that the defendant, an
educated, competent person, would have cavalierly signed a document entitled
"Construction Contract," thinking it was not enforceable. This is especially true since
there is no evidence of the existence of an alternative agreement between the parties. If
the agreement were simply cost of materials plus labor, one would expect that there
would at least be an agreement about the labor rate for any of the individuals who
worked on the house and an agreement governing when payment was due.
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Subsequently, when the parties were completing Def.'s Ex. #1,2,3, and 4, they
mutually discussed why it was necessary to create those documents, and were both
aware that it was for financing purposes only. Together, they manipulated the entries in
the documents to satisfy the bank, not to reflect the reality of their agreement. Thus, the
Court does not construe those documents as constituting any changes or additions to
the contractual agreement.
Since the defendant stopped working on the home, he has acted in a manner
consistent with having a belief that the June 20,2006 contract defined the relationship
between the parties in the construction project. He wrote to plaintiff's counsel on
March 5,2007, Pl.'s Ex. #9. In this correspondence, he summarized various aspects of
the written contract and then stated, "so I am ready to finish the house under my
contract with Mary." In the same correspondence, he also stated, "we used Mary's
contract with Hammer-All as the basis for the project and added in finishing the
exterior trim, siding it in pre-stained cedar shingles, and installing a hardwood floor.
Mary said she needed these items in the contract to make it work for the bank. The price
stayed the same at $173,400 with some $20,000 in additional labor and material added
to the base." By making these comments, the defendant implicitly acknowledged that
the parties' obligations were contained in the written contract. Additionally, as plaintiff
has pointed out, Defendant has admitted in the course of discovery that the June 20,
2006 agreement constitutes the contract in plaintiff's complaint, Pl.'s Ex. #356 at p.l;
Pl.'s Ex. #357 at 1.
The defendant argues that he could not have intended for the contract to be
enforceable because he made no independent assessment of price, because the contract
provided that plaintiff had control over the selection of materials, yet the contract was
for a fixed price; and because plaintiff tracked spending, making it difficult for
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defendant to monitor contract expenditures. Although these observations are accurate,
the Court believes that the defendant reached the agreement without exploring
potential consequences. He probably was not thinking about the actual mechanics of
complying with the agreement, or what would happen if a dispute arose, but was only
trying to provide assistance to the plaintiff. Although it was improvident of him to sign
the agreement, he did so intending to be bound by its terms.
There is one curious aspect of the contract that deserves further discussion.
Although the Daigle contract was dearly based on the Samaras contract, Mr. Daigle
included flooring in the agreement but did not increase the contract price to reflect the
increased cost to purchase and install the flooring. He testified that he included it in the
contract because plaintiff told him the bank required that the floor be installed and
finished now, rather than later. Although his comments about the flooring in PI's. Ex. 9
are somewhat ambiguous because it is not clear what "add it to the base" means, The
Court does not conclude that he intended to install the flooring as an expensive gift to
Ms. Addison. With regard to the flooring alone, the Court considers extrinsic evidence
concerning whether the parties intended to be bound by the written contract in this
regard, and finds that the parties intended that plaintiff pay for the flooring, over and
above the full contract price.
2. Breach and Damages
Although the parties disagree on the extent of the breach, they agree the project
is not complete. Implicit in the contract is the requirement that the construction be
finished according to its terms and since it is not finished, the defendant has breached.
The Court will use the plaintiff's format in discussing the elements of the breach and
damages, addressing each issue in the order listed in plaintiff's memorandum.
Although the plaintiff alleges that the defendant breached the contract by failing to
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complete the project by December 20,2006, the Court does not find a breach in this
regard. The relevant phrase in the contract, "[w]ork is expected to start July 20th and
complete on December 20th , 2006 A.D." falls short of requiring that the project be
completed by that date. The Court finds that the word "expected", although awkwardly
used, applies to "start" and "complete", and implies that contingencies could
reasonably delay completion. Even if this phrase were construed to require completion
by December 20,2010, the defendant has appropriately described several delays
attributable to the plaintiff, such as her insistence on certain changes and the delay in
her mason's completion of the chimney, that would excuse the delay and result in no
award of damages. See generally RESTATEMENT (SECOND) OF CONTRACTS, § 269
(1981); Rockland Poultry Co. v. Anderson, 148 Me. 211, 216, 91 A.2d 478 (1952). The Court
presumes, in the absence of a firm completion date, that performance was to be
complete within a reasonable period of time. See Cellar Dwellers, Inc. v. Dominic
D'Alessio, Jr., 2010 ME 32, <JI 16, 993 A2d 1, 10-11.
The other damage claims will now be addressed in order. Some of the costs
determined by the Court are lower than the estimates of Mr. Schiele, primarily because
his estimates were based on an hourly rate of $45, excessive for the area. Qualified
carpenter's assistants are paid between $20 and $25 per hour and Mr. Manion, an
engineer and carpenter, only earned $40 per hour while working on the project. In
determining damages, the Court will discount the Schiele estimates that include
materials and labor by 10%, and the estimates that include labor only by 20% because
the work could be performed by a combination of qualified carpenters and assistants. In
the ensuing analysis, the discounted amount, reflecting actual damages that the Court is
awarding, will not appear in parenthesis, while the full amount designated by Schiele
will appear in parentheses.
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l.Kitchen Cabinets - The Court finds that providing and installing kitchen
cabinets was required by the contract and not accomplished. The cost of cabinets to
complete the kitchen is $6,000, while the reasonable cost of installation is $2,536 ($3,170).
The plaintiff has already purchased the floor cabinets for $3,465, subsumed within the
$6,000 estimate.
2. Daylight Basement - The daylight basement opening was not in the plans, and
therefore, the Court finds there is no contractual requirement that defendant bare the
cost of completion.
3. Bathroom Completion - In order to complete the bathroom according to the
plans, including toilets, shower, vanity, soaking tub, roman shower completion, faucets,
hookups, and connections, a reasonable expense of $15,210 ($16,900) will be incurred.
4. Reframing Common Bath Area - The Court does not award damages in this
category because the parties agreed to the alterations to the plans concerning the
common bath area. The $696 spent to hook up one toilet and sink is recoverable.
5. Electrical- Having a licensed electrician make necessary corrections was a
necessary expense. Plaintiff is awarded her reasonable expense in this regard, $2,905.
6 Interior Finish - The estimated cost to provide doors, finish, and install them is
$5,490 ($6,100). The Court does not find that sheetrock was improperly installed, but
finds that the cost of finishing wood floors is included in the contract, since the use of
pre-finished flooring was not specified. The reasonable cost for installation and
finishing is $4,560 ($5,700). The reasonable cost to trim windows and doors is $3,830
($4,800). The Court is not including the cost of floor finishing because of the Court's
ruling that this expenses was not included in the contract price.
7. Heating - The contract included a euro-type boiler heating system. The
allowance in the Samaris contract for the system is $11,500 and, coincidently, the
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plaintiff has spent that amount on the installation of a system. The damages related to
this element of the breach are $11,500.
8. Siding - The purchase and installation of the siding was required by the
contract. It will cost $6,080 ($7,600) to install the siding that is already at the site.
9., 10., & 11. Baseboard - It will cost $2,000 ($2,500) to vent the dryer and finish
the interior baseboard, the garage, and wheelchair ramp.
12. & 13. Rear Porch and Deck - The Court is not awarding damages for failing to
finish the enclosed porch properly or for failing to finish or improperly installing the
rear deck. The plans include neither an enclosed rear porch, nor a rear deck. The Court
does not find that the defendant improperly installed the rear porch or deck and finds
that his work on the porch/ deck was made more difficult by the foundation
contractor's failure to install cheek walls in the area. The defendant was not responsible
for foundation work.
14. & 15. Front Porch and Entryway - The contract included a front porch, which
is incomplete. The reasonable cost of completion is $4,752 ($5,280).
16. Second Floor Completion - The reasonable cost of completing the second
floor pursuant to the plans is $4,230 ($4,700).
17. Dormers, Bay Windows - The Court is not awarding costs associated with
these claims. The parties orally modified their contract to replace two single dormers in
the front with two skylights and to replace a single dormer in the back with a double.
Because the defendant installed the skylights and dormer pursuant to the modification,
there are no damages. Likewise, the parties agreed mutually to dispense with the bay
windows. This was done in recognition of the many "extras" provided by the
defendant, including the superior clapboards, many interior accommodations for
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wheelchair accessibility and other reasons, as well as the framing changes to decrease
the number of posts, and to strengthen the building to accommodate snow loads.
The total of these amounts represents the damages total. Although plaintiff
incurred out of pocket expense to pay for goods and services that should have been
supplied by defendant, $16,628.40 to Davis Builders, $2,950 to Gray Electric, $11,500 to
David Brown for heating, and $3,465 to Home Depot for kitchen cabinets; these sums
are not being added to the damages amount because the amounts are subsumed in the
Schiele estimates. Mr. Schiele performed his inspection in January of 2007, before
Davis, Gray, and Brown worked at the home to address some of the shortcomings
found by Schiele. Additionally, the kitchen completion estimate contemplated that no
cabinets had been purchased, so it included the value of the Sebco cabinets that plaintiff
purchased.
B. COUNTS II AND III
To the extent that the defendant was negligent in his execution of the contract or
breached the implied warranty, any damages in relation thereto have already been
awarded. In reality, any negligence or warranty breach was minor.
C. COUNTIV
The Court finds that the defendant misrepresented nothing. In discussing the
dormers and bay windows, the defendant agreed to alter or delete them to save money
overall on the project and in recognition of the he defendant's willingness to provide
more than the contract specified in other areas.
D. COUNTY
The Court does not award consequential damages. It does not construe the
contract as specifying a December 20, 2010 completion date. It was reasonable, because
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of the changes in he contract agreed upon by the parties and the delays not caused by
the defendant, to be working toward completion well beyond that date. Additionally,
There is no evidence of the value of the experience of living in the new home versus
remaining in the quilt shop, nor for living in an unfinished house. Awarding
consequential damages would be based on speculation.
E. COUNT VI
Plaintiff asserts a claim under the Unfair Trade Practices Act (UTPA), via a
violation of the Home Construction Contract Act (HCCA). If the plaintiff prevails on the
HCCA claim, she is entitled to a receipt of a civil penalty, 10 M.R.S.A. § 1490(2) and the
violation constitutes prima facie evidence of violation of UTPA, 10 M.R.S.A. § 1490(1),
that could lead to award of attorney fees. 5 M.R.S.A. § 213(2).
All would agree that the contract signed in this case does not conform to the
requirements of 10 M.R.S.A. § 1487. The Court finds that, although there is a violation,
the defendant was not aware of the requirements of the law in this regard nor could he
be expected to know of the contract requirements because he was not a contractor who
was in the occupation of building for others. Instead, he was a person helping a friend
and who was expecting a reasonable amount of compensation. He was not seeking an
advantage by drafting an inadequate contract and was not misrepresenting anything.
He, in fact, was not engaging in any specific unfair trade practice that can be identified.
contract price.
According to 10 M.R.S.A. § 1490(2), no home contractor may be held liable for a
civil violation under the HCCA "if the contractor shows by a preponderance of the
evidence that the violation was an unintentional and a bona fide error, notwithstanding
the maintenance of procedures reasonably adopted to avoid any such error." Because
this violation was unintentional and a bona fide error, the Court applies this exception
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in this case and does not order the defendant to pay a civil penalty. The Court
recognizes that the exception is only to be applied when the contractor has "procedures
reasonably adopted to avoid any such error," and the defendant had no such
procedures; but discerns an intent that such procedures not be required of a non
professional contractor who would have no reason to adopt such procedures.
Finally, the plaintiff requests that the Court order the defendant to pay her
attorney fees since a violation of the HCCA is prima facie evidence of an unfair trade
practice. Because the Court finds that the defendant in fact committed no unfair trade
practice, the prima facie effect of the HCCA violation is overcome and the Court does
not order payment of attorney fees.
F. COUNTERCLAIMS
Because the Court has found for the plaintiff on the breach of contract count of
plaintiff's complaint, it finds for Ms. Addison on the breach of contract counterclaim.
The unjust enrichment and quantum meruit counterclaims are rejected because the
Court has already found that a contract governed the obligations of the parties in the
construction of this home. All goods and services provided that represent the amount
due in the counterclaim were provided under the terms of the contract, and were not
provided under circumstances required by unjust enrichment or quantum meruit.
The entry is:
The Court Orders that Judgment be entered for the plaintiff on Count I of her
complaint and awards damages in the amount of $65,229, pre judgment interest at the
rate of 5.99%, and costs; and that Judgment be entered for the defendant on Counts II
through VI.
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The Court Orders that Judgment be entered for the counterclaim defendant on all
counterclaims.
The clerk is directed to incorporate this Judgment into the docket by reference.
Dated: July 30,2010 W~~. v~
WILLIAM ANDERSON
JUSTICE, SUPERIOR COURT
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.-
MARY ADDISON - PLAINTIFF DISTRICT COURT
••
Attorney for: MARY ADDISON
BANGOR
Docket No BANDC-CV-2007-00391
JOSEPH FERRIS - RETAINED 07/13/2007
LAW OFFICE OF JOSEPH L FERRIS PA DOCKET RECORD
120 N MAIN ST
BREWER ME 04412
vs
EUGENE DAIGLE - DEFENDANT
•
• L L2
Attorney for: EUGENE DAIGLE
JAMES C MUNCH III - RETAINED
VAFIADES BROUNTAS & KOMINSKY
23 WATER STREET
PO BOX 919
BANGOR ME 04402-0919
Filing Document: COMPLAINT Minor Case Type: CONTRACT
Filing Date: 07/13/2007
Docket Events:
07/16/2007 FILING DOCUMENT - COMPLAINT FILED ON 07/13/2007
5-9-08 COPY OF COMPLAINT SENT TO THE OFFICE OF THE ATTORNEY GENERAL, CONSUMER AND
ANTITRUST DIVISION, STATE HOUSE STATION 6, AUGUSTA, MAINE (UNFAIR TRADE PRACTICE)
07/16/2007 Party(s): MARY ADDISON
ATTORNEY - RETAINED ENTERED ON 07/13/2007
Plaintiff's Attorney: JOSEPH FERRIS
07/16/2007 Party(s): MARY ADDISON
MOTION - APPROVAL ATTACH/TRUSTEE PROC FILED WITH AFFIDAVIT ON 07/13/2007
Plaintiff's Attorney: JOSEPH FERRIS
ALONG WITH MEMORANDUM OF LAW
07/30/2007 Party(s): EUGENE DAIGLE
SUMMONS/SERVICE - ACCEPTANCE OF SERVICE SERVED ON 07/23/2007
SIGNED BY ATTY JAMES MUNCH III.
07/30/2007 Party(s): EUGENE DAIGLE
SUMMONS/SERVICE - ACCEPTANCE OF SERVICE FILED ON 07/25/2007
Plaintiff's Attorney: JOSEPH FERRIS
08/15/2007 Party(s): EUGENE DAIGLE
RESPONSIVE PLEADING - ANSWER & AFFIRMATIVE DEFENSE FILED ON 08/10/2007
Defendant's Attorney: JAMES C MUNCH III
08/15/2007 Party(s): EUGENE DAIGLE
RESPONSIVE PLEADING - COUNTERCLAIM FILED ON 08/10/2007
Defendant's Attorney: JAMES C MUNCH III
08/15/2007 Party(s): EUGENE DAIGLE
Page 1 of 5 Printed on: 05/09/2008