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Jardine Estates Inc. v. Donna Brook Corp.

Decided: November 2, 1956.


Goldmann, Freund and Conford. The opinion of the court was delivered by Freund, J.A.D.


[42 NJSuper Page 335] This is an appeal by the plaintiff, hereinafter referred to as "Jardine," from a judgment in favor of the defendant, referred to as "Donna Brook," entered on a jury verdict after the third trial of the cause. Two actions were consolidated. The first was brought by Jardine, an owner of land, against Donna Brook as builder, and James R. Prisco, its president, individually, to recover damages for failure to complete work under a building contract and for defective work performed. The second suit was instituted by Donna Brook against Jardine to recover

the unpaid balance alleged to be due under the contract, for extra work, and for work and materials on adjoining property. By counterclaim, Jardine incorporated the allegations of its complaint in the first action.

A written contract was entered into on January 5, 1953 for the erection on or before May 1, 1953 of a one-family dwelling house, in accordance with plans and specifications, for the amount of $19,500 to be paid in scheduled payments. Three payments were made, but about the time the fourth payment was to become due, a dispute arose. Jardine contended that the required work had not been performed, and paid only such portion of the payment as it thought Donna Brook had earned. Donna Brook claimed that it was entitled to the full amount of the fourth payment, and filed a notice of intention. Mr. Samurine, president of Jardine, testified that he told Prisco to discharge the notice of intention because it was obstructing his mortgage transactions, or not to proceed under the contract. There was also testimony that after May 1st when Donna Brook's men came to clean up, they were chased from the job. Jardine had paid $11,900, leaving a contract price balance of $7,600. The countersuits were then instituted. Expert, but conflicting, testimony was offered by the parties as to the respective items of damages. The court directed the jury to return special verdicts. Two were rendered in favor of Jardine -- one for $1,516.55 for unfinished work and the other for $4,558 for defective work, totalling $6,074.55. The jury awarded Donna Brook $10,726.38 without breakdown; but it obviously comprised the balance of the contract price, extras and work on adjoining premises. Thus, the verdicts resulted in a net award of $4,651.83 in favor of Donna Brook. Jardine's motion for a new trial was denied and, upon application, the trial court added interest of $480 to the judgment for Donna Brook, making a total net judgment of $5,131.83, from which Jardine appeals.

Jardine had sought a personal judgment against James R. Prisco, Donna Brook's president, on the theory that he, and not the corporation, was the contracting party. The question

of his liability was charged by the court and submitted to the jury. However, according to the record, no express finding was made on the issue. He was impliedly exonerated, for the verdict was rendered and judgment entered only against Donna Brook. Moreover, the judgment which was entered in favor of Donna Brook for the net balance due it, was consented to as to form by Jardine without any apparent objection on this ground. In any event, the point is academic in view of our determination of this appeal on the merits.

Several other points were argued by the appellant, only one of which the respondent answered in its brief, namely, that Donna Brook failed to substantially complete the building. The appellant also argues that the court erred in the following respects: in the admission of parol evidence, in failing to declare a mistrial, and in adding interest to the verdict.

A building contractor is not entitled to recover unless he has substantially complied with the contract, but if he has, he is entitled to recover the contract price, less a fair allowance to the owner for minor defects or omissions. Bozarth v. Dudley , 44 N.J.L. 304, 310 (Sup. Ct. 1882); Feeney v. Bardsley , 66 N.J.L. 239 (E. & A. 1901); Van Dusen Aircraft Supplies, Inc., v. Terminal Const. Corp. , 3 N.J. 321 (1949); R. Krevolin & Co., Inc., v. Brown , 20 N.J. Super. 85, 90 (App. Div. 1952); Winfield Mutual Housing Corp. v. Middlesex, etc., Corp. , 39 N.J. Super. 92, 97 (App. Div. 1956).

Substantial performance is compliance in good faith with all important particulars of the contract. 17 C.J.S., Contracts , § 509, p. 1087. "* * * there is substantial performance of such a contract where all the essentials necessary to the full accomplishment of the purposes for which the thing contracted for has been constructed are performed with such an approximation to complete performance that the owner obtains substantially what is called for by the contract." 9 Am. Jur., Building and Construction Contracts , § 42, p. 31. A builder's default should not be willful, nor the defects so serious as to deprive the property of its value

for the intended use, nor so pervade the whole work that a deduction in damages will not be fair compensation. 3 Williston on Contracts (rev. ed.) , § 805, p. 2256 et seq.

Where there is conflicting testimony as to whether or not the contractor has substantially performed the contract, the issue is to be determined by the trier of the facts. Here, the questions pertaining to the extent of performance, abandonment, the uncompleted work and the defective work were disputed issues of fact, and, therefore, were properly submitted to the jury. Brannworth v. Borough of Verona , 94 N.J.L. 194 (E. & A. 1920). The verdict of the jury under the charge of the court determined that Donna Brook did not abandon the contract, but substantially performed, within time; and by its verdict ...

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