Court Opinion

ID: 9718422
Source: CourtListenerOpinion
Date Created: 2023-08-26 07:23:27.620982+00
Date Added: 2024-06-11T18:23:59.165254
License: Public Domain

JUSTICE COOK, dissenting: I respectfully dissent. In traditional contract terms a subcontractor’s quote to a general contractor is only an offer, which the subcontractor is free to withdraw at any time before the general contractor accepts it. The subcontractor may accordingly withdraw the offer after the general contractor has used it to compute the bid on the prime contract, and even after the prime contract has been awarded. Likewise, the general contractor has no obligation to accept the subcontractor’s offer, even if the general contractor is awarded the prime contract. Subcontractors may renege on their quotes; general contractors, with the leverage of the award of the prime contract and the subcontractor’s quote in their pocket, may shop around for lower subcontract bids, or apply pressure to the bidding subcontractor to reduce his bid (all with no benefit but possible detriment to the owner). This situation is an undesirable one for the parties involved, and for the public at large, who ultimately bear the cost of unfair contract bidding. (See Glosen & Weiland, Competitive Bidding and Contract Formation in the Construction Industry, in Contracts and Sales of Goods ch. 17, §17.9 (Ill. Inst, for Cont. Legal Educ. 1990) (hereinafter Glosen & Weiland).) The Illinois cases have given the general contractor protection by the doctrine of promissory estoppel: a promise unsupported by consideration may be binding if the promisee reasonably relied upon it to his substantial detriment. (S.M. Wilson & Co. v. Prepaid Concrete Co. (1974), 23 Ill. App. 3d 137, 318 N.E.2d 722; Vincent DiVito, Inc. v. Vollmar Clay Products Co. (1989), 179 Ill. App. 3d 325, 534 N.E.2d 575; Bank of Marion v. Robert “Chick” Fritz, Inc. (1974), 57 Ill. 2d 120, 124, 311 N.E.2d 138, 140.) As applied in these cases promissory estoppel protects the general contractor but not the subcontractor. It is possible to protect both parties by the execution of a bilateral contract following the subcontractor’s quote. The contract would be conditional because there would be no binding obligation on either party unless the general contractor were awarded the prime contract. “This condition is so obvious and basic in the construction industry setting that it should be implied from the circumstances even if the parties did not expressly so state in the course of their [negotiation].” (Glosen & Weiland, §17.13, at 17 — 17.) A written agreement absolute on its face may be shown to be subject to an unwritten condition precedent. See Heavy Grady & Crouch Realtors v. Hall (1982), 110 Ill. App. 3d 325, 329, 442 N.E.2d 307, 310; Althoff Industries, Inc. v. Elgin Medical Center, Inc. (1981), 95 Ill. App. 3d 517, 521, 420 N.E.2d 800, 803; Restatement (Second) of Contracts §217 (1981). The parties to a subcontract can agree that it will be binding even if the general contractor is not awarded the prime contract. Such an agreement would be so unusual, however, that a court should not find one to exist without clear evidence. Such a contract would, in essence, involve a penalty as the general contractor would be required to pay for work which was not done, from funds which he did not receive. If a contract requires payment to a subcontractor who does not do the work, the contract would logically be expected to set out a formula specifying how the payment would be calculated. There is no language in the simple single-page invoice-form contract here which would indicate that defendant’s obligation is unconditional. Nor is there any testimony shown in the bystander’s report which would support an unconditional contract. The only expression of plaintiff’s intent is that “[p]laintiff testified that he would not agree to leave Paris or to perform any work until he had received a signed agreement from [defendant].” The majority opinion states that, despite the past dealings between the parties, no evidence was introduced of a document like the one here being signed by defendant. That is true enough, but what does the existence of the document (as opposed to its language) suggest? Was plaintiff afraid he would do the work and not get paid? Was he afraid he would arrive at the jobsite and there would be a delay? Was he afraid defendant would choose another subcontractor after the prime contract was let? The record suggests all those concerns, but none of them are inconsistent with a conditional subcontract. It may be plaintiff’s argument that a representation had been made to him, before defendant executed the subcontract, that the prime contract had been awarded; therefore, the subcontract had to be unconditional. Again, the bystander’s report contains little support for such an argument. It is clear defendant was never awarded the prime contract. Plaintiff testified that defendant “never told him” that the contract was contingent on acceptance by Bredeman Ford of the prime contract. Plaintiff, however, knew that his contract was a subcontract. Plaintiff could not justifiably equate (1) never being told the prime contract had to be accepted, with (2) the fact the prime contract had been accepted. The statements made after the subcontract was executed are consistent with waiting for an award of the prime contract: “the job start was put off and delayed for a week,” “the job contract was being delayed further.” Even the testimony “that a question on cable was the cause of the delay” is not inconsistent with waiting for the award of the prime contract. Defendant’s witness, Ross Bogue, clearly testified plaintiff was told the prime contract had not been awarded. Plaintiff’s vague testimony cannot be read to contradict Ross’ testimony, especially in light of the strong presumption favoring a conditional contract. I would reverse the appealed judgment.