The liability of the owner in a case where construction is destroyed is measured by the amount of the contract work done which, at the time of the destruction of the structure, had become so far identified with it as that but for the destruction it would have enured to him as contemplated by the contract.
Plaintiff was hired by defendant to build a concrete floor in defendant's building. Before full completion of the floor, the building burned. Plaintiff could not complete the contract as defendant did not rebuild the building and plaintiff sought reimbursement for materials and labor expended. The trial court held in favor of plaintiff permitting substantial recovery for the work plaintiff performed. Defendant sought review of an order of the Douglas District Court (Kansas) which entered judgment in favor of plaintiff for breach of contract..
If nonperformance was not the result of either party, can either party be liable to the other for damages due to nonperformance?
The reviewing court reversed and remanded, holding burning of the building created an impossibility of performance. Since impossibility of performance was not contemplated or caused by either party, neither party could be held responsible for nonperformance. However, plaintiff was entitled to damages in an amount equal to the benefit defendant received prior to destruction of the building, that benefit being measured by the amount of contract work done that had become identified with the building. Where construction is destroyed, it takes something more to make the owner liable for what the contractor has done toward performance. The owner must be benefited. He should not be enriched at the expense of the contractor. To the extent that the owner has been benefited the law may properly consider him as resting under a duty to pay. The benefit which the owner has received may or may not be equivalent to the detriment which the contractor has suffered. The only basis on which the law can raise an obligation on the part of the owner is the consideration he has received by way of benefit, advantage, or value to him. Reimbursement to plaintiff was necessary to avoid defendant's unjust enrichment from plaintiff's labors.