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Ippolito v. Jeffrey Angelo Construction Co., Inc.

A-4149-07T2 (N.J. Super. App. Div. 2009) (Unpublished)

CONTRACTORS — Where a contractor has performed services in good faith with the reasonable expectation to receive compensation and where the value of the services is reasonable and were accepted, then, under a quantum meruit theory, the contractor should be compensated for the value of those services.

A property owner entered into a written contract with a home builder to construct a single-family residence on her property. The contract included a clause stating that if there were any change to the specifications involving extra costs, these changes must be in writing and would result in an extra charge. Since the architect’s plans did not identify the specific brand of items to be placed in the home, the contract provided for allowances for such items. If the actual cost of the items actually chosen by the owner was less than the allowance, she would receive a credit. If the cost exceeded the allowance, she would be charged for the overage. When the house was almost fully built, the contractor presented the owner with a change order itemizing all the credits and overages. The property owner refused to pay, claiming that the original contract price was her only obligation. The property owner sued the contractor, seeking to compel the contractor to complete construction and obtain a Certificate of Occupancy. The builder counterclaimed for the money it claimed it was due under the contract.

The Law Division ruled in favor of the home builder. It found the property owner’s testimony to be incredible and the contractor’s testimony to be credible. At trial, the owner did not challenge the accuracy or reasonableness of the charges. She claimed that she was entitled to rely on the literal terms of the contract. She alleged that if there were no signed change orders, the only obligation she had was to pay the contract price. The Court disagreed, finding that the contract clearly provided that these charges were to be paid by the property owner. The property owner appealed.

The Appellate Division affirmed. It believed that the lower court’s findings as to credibility were well supported by evidence on the record. The Court also agreed with the lower court that where, as here, a party has performed services in good faith, the services were accepted by the person for whom they were rendered, the party performing the services reasonably expected compensation, and the value of the services was reasonable, then, under a quantum meruit theory, the party performing the services should be compensated for the value of those services.

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