Pennsylvania Supreme Court Holds Contractor May Recover in Quantum Meruit Where Home Improvement Contract Does Not Satisfy Statutory Requirements for Enforcement

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Shafer Elec. & Constr. v. Mantia, 2014 Pa. LEXIS 1766 (Pa. July 21, 2014)

Homeowners Raymond and Donna Mantia contracted Shafer Electric & Construction (“Shafer”) to build a two-car garage addition onto their house. Shafer’s proposal was extremely detailed as to the work to be completed. Despite the detail in Shafer’s specifications, however, Shafer’s proposals did not comply with several requirements of the Home Improvement Consumer Protection Act, 73 P.S. §§ 517.1-517.18 (the “Act”). Specifically, pursuant to the Act, any home improvement contract must be legible, in writing, and satisfy thirteen other requirements. § 517.7(a). The contract satisfied only three of those requirements.

Notwithstanding the deficiencies, work began on the addition. During the subsequent months, a dispute arose concerning changes the Mantias made to the design of the addition. Other alterations became necessary as a result of excavation problems that arose during the work. The parties could not agree on a new contract, which Shafer believed was required due to the design changes. The parties agreed that Shafer would stop work and invoice the Mantias for the work it completed. When Shafer issued the final invoice, the Mantias refused to pay.

Shafer brought claims for breach of contract and quantum meruit. The Mantias filed a demurrer on the bases that (1) that the contract was unenforceable because it did not comply with the Act; and (2) the quantum meruit claim was barred by § 517.7(g) of the Act, which provides, “Nothing in this section shall preclude a contractor who has complied with subsection (a) from the recovery of payment for work performed based on the reasonable value of services which were requested by the owner if a court determines that it would be inequitable to deny such recovery.” The Mantias argued that Shafer was precluded from bringing any claim – in quantum meruit or otherwise – because Shafer did not comply with § 517.7(a).

The trial court agreed with the Mantias, but the Superior Court reversed, holding that the quantum meruit claim was viable even though the contract claim failed. The Mantias appealed, and the Supreme Court affirmed, albeit on slightly different grounds.

The issue before the Court was simply whether the Act barred a contractor from recovery in quantum meruit in the absence of an enforceable home improvement contract under the Act. The Court held that the Act did not bar a quantum meruit claim in these circumstances because § 517.7(g) speaks only to the availability of remedies to a contractor who complies with § 517.7(a). Here, Shafer did not comply with § 517.7(a); thus, § 517.7(g) was not implicated. The Court further held that nothing in the Act abrogated the common law right of contractors to recover in quasi-contract when a claim for breach of an express contract is not available.

The Court found support in the Superior Court’s decision in Durst v. Milroy Gen. Contracting, Inc., 52 A.3d 357 (Pa. Super. Ct. 2012). In Durst, the Superior Court held that the Act did not bar a home improvement contractor from recovering in quantum meruit from two homeowners who had failed to pay him pursuant to an oral contract for home improvements, despite that the existence of the oral contract (as opposed to the written contract required by the Act) precluded the contractor from recovering on a breach of contract theory.

To view the full text of this decision, courtesy of Lexis ®, click here.

Topics:  Construction Contracts, Construction Industry, Contract Disputes, Contractors, General Contractors, Quantum Meirut

Published In: Civil Procedure Updates, Civil Remedies Updates, General Business Updates, Construction Updates, Residential Real Estate Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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