Procedural Posture

Appellant general contractor sought review of a judgment of the Superior Court of Yuba County (California), which rendered a judgment in favor of respondent subcontractor in the subcontractor’s action on a common count to recover for services rendered.

California Business Lawyer & Corporate Lawyer, Inc. understands CACI 204

Overview

The parties entered into a subcontract for certain work on an Air Force base. The subcontractor’s work was completed satisfactorily and was accepted by the contractor. Another subcontractor damaged a pipeline. The subcontractor agreed to do the repairs for payment, which was authorized by the contractor’s president. After the work was done, the contractor refused to pay the bills. The contractor claimed that the subcontract between the parties obligated the subcontractor to perform the work of repair and, therefore, the subsequent agreement to pay for the repairs was without consideration and unenforceable. On appeal, the court held that the settlement of the dispute by the contractor’s new promise to pay was supported by sufficient consideration. The subcontract was not clear in that its language was uncertain as to whether the parties meant “final acceptance” of the work or the entire project. The court further found that the subcontractor was not estopped to recover the amount sued for on the basis of alleged billing irregularities. The court found that when the contractor received the billing, there was no right to set-off under the original subcontract.

Outcome

The court affirmed the judgment of the trial court.

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