In a non-precedential ruling, Massachusetts Appeals Court shot down the claim of a subcontractor who, refused to perform disputed work and walked off the job. Acme Abatement Contractor, Inc. V. S&R Corporation, Mass: Appeals Court (2015)
FACTS S&R hired Acme Abatement for part of the scope of a job at a plant and its grounds. Abatement subcontract required that the sub perform first and dispute charges after. A dispute arose over whether the subcontract scope included removal of paint from stadium bleachers. S&R said that work was included in the Acme scope but ACME said there was nothing to abate in the bleacher paint.
The subcontract said that in the event of a dispute over work, the sub would first perform the disputed work and then seek resolution afterwards. Any failure was called a material breach of the subcontract. ACME did not dispute that it violated this provision.
ISSUE ACME argued however that it was entitled to payment since it substantially performed.
S&R had to scramble to hire a replacement to finish the scope Acme refused to perform.
RULING Sub’s claim was dismissed since it breached the ‘perform immediately and sue later’ provision.
TAKE AWAYS Subcontractors need to clarify scope at the start; make sure that all the work called for is included in the price. Owners’ and General Contract’s should include the ‘work now sue later’ clause.