Court Opinion

ID: 4924269
Source: CourtListenerOpinion
Date Created: 2021-09-22 15:06:33.365245+00
Date Added: 2024-06-11T08:14:13.258292
License: Public Domain

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                             FOURTH DISTRICT

                               CANO, INC.,
                                Appellant,

                                     v.

                            MICHEL JUDET,
                               Appellee.

                              No. 4D20-1509

                          [September 22, 2021]

  Appeal from the Circuit Court for the Nineteenth Judicial Circuit, St.
Lucie County; Barbara W. Bronis, Judge; L.T. Case No.
562017CA001434AXXXHC.

   Christopher B. Hopkins of McDonald Hopkins LLC, West Palm Beach,
Ryan V. Kadyszewski of Ryan V. Kadyszewski, P.A., Palm Beach Gardens,
and Mike Piscitelli and Jodi Cohen of Vezina, Lawrence & Piscitelli, P.A.,
Fort Lauderdale, for appellant.

   Michael G. St. Jacques, II of MGS Law, P.A., Jupiter, for appellee.

WARNER, J.

   Cano, Inc. appeals a final judgment in favor of Michel Judet for the
amount that Judet overpaid Cano for work done pursuant to a
construction contract which Cano breached. Cano claims that the trial
court used the wrong measure of damages for breach of a construction
contract. The trial court awarded damages to return Judet to his pre-
contract position less the quantum meruit value of Cano’s services. Under
the circumstances of this case, the measure of damages was proper. We
also find no reversible error as to the other issues raised. We thus affirm.

   In 2016, Judet’s home was damaged by lightning, and he entered into
a written contract with Cano to repair the damage for a fixed price of
$300,000 payable in $30,000 increments. Pursuant to the contract, Cano
started work. Judet made $90,000 in payments. When Judet discovered
that Cano had not obtained some of the building permits for the
construction, he terminated Cano.
    As a result, Cano filed a construction lien on the property for $40,000
which it claimed was due. Cano sued Judet seeking to foreclose on the
lien and sued Judet for breach of contract and unjust enrichment. Judet
answered and counterclaimed for breach of contract. Judet sought
discharge of the lien, restitution for the amount he paid Cano in excess of
the value of the work, costs of storage of his household goods during
construction, and disgorgement of monies paid for unpermitted work.
Cano answered, denying it had breached the contract.

    In the pre-trial stipulation, the parties stipulated that permits had not
been obtained for the electrical or plumbing work. At the non-jury trial,
both parties presented experts as to the reasonable value of the work
performed. Judet’s expert placed the value of the work performed by Cano
at $49,150. The expert also testified that Judet contracted with him to
finish the repairs on the house at a cost of approximately $160,000 with
extras. At the close of the evidence, the court expressed the opinion that
Judet’s expert was more knowledgeable about the values in the community
than Cano’s expert.

    The court requested each party to submit a proposed final judgment.
After receiving the proposed final judgments and waiting approximately
thirty days, the court entered the final judgment proposed by Judet. 1 The
trial found that Cano committed the first material breach of the contract
by failing to obtain the required permits and by failing to substantially
perform its obligations under the contract. Thus Cano was only entitled
to the value of the work performed which the court found to be $49,150,
consistent with Judet’s expert. The court found Cano’s expert not to be
credible.

   As Judet had already paid Cano $90,000, the court entered a judgment
of $40,850 in favor of Judet on his counterclaims, the difference between
the quantum meruit value of the work and what Judet paid. It found in
favor of Judet on all of Cano’s claims and found Cano’s claim of lien
invalid. Cano appeals the final judgment.

1 Cano claims that the court violated Perlow v. Berg-Perlow, 875 So. 2d 383 (Fla.
2004), in entering Judet’s proposed final judgment. Perlow is inapposite. What
occurred in this case is more in line with Strand v. Escambia County, 992 So. 2d
150 (Fla. 2008). Here, the trial court did indicate some findings on the record,
including that Judet’s expert was more believable than Cano’s expert. It also
accepted proposed final judgments from both parties and then did not sign
Judet’s proposed final judgment for another thirty days after they both were
submitted, giving each party ample time to object.

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   Cano contends that the court used the wrong measure of damages in
entering judgment for Judet. “Whether the trial court applied the correct
measure of damages is a question of law reviewed de novo.” DFG Grp., LLC
v. Heritage Manor of Mem’l Park, Inc., 237 So. 3d 419, 421 (Fla. 4th DCA
2018) (citing Del Monte Fresh Produce Co. v. Net Results, Inc., 77 So. 3d
667, 673 (Fla. 3d DCA 2011)).

    Where a contractor breaches a construction contract, and the owner
sues for breach of contract and the cost to complete, the measure of
damages is the difference between the contract price and the reasonable
cost to perform the contract. See Grossman Holdings Ltd. v. Hourihan, 414
So. 2d 1037, 1039–40 (Fla. 1982). In Grossman, the supreme court
adopted subsection 346(1)(a) of the Restatement (First) of Contracts
(1932), which it concluded was “designed to restore the injured party to
the condition he would have been in if the contract had been performed.”
Id. at 1039. In other words, the owner will obtain the benefit of his bargain.
But where there is a total breach of the contract as opposed to a partial
breach, an injured party may elect to treat the contract as void and seek
damages that will restore him to the position that he was in prior to
entering into the contract or the party may seek the benefit of his bargain.
See McCray v. Murray, 423 So. 2d 559, 561 (Fla. 1st DCA 1982).

   Forbes v. Prime General Contractors, Inc., 255 So. 3d 448 (Fla. 2d DCA
2018), explains the alternative measures of damages in a construction
contract case. In that case, the homeowners, the Forbeses, hired a
contractor, Prime, to remodel their home and entered into a contract with
periodic draws. Before the job was very far along, Prime determined that
the cost of materials had increased and demanded almost twice the
contract price. The Forbeses refused to sign a change order to that effect,
and Prime walked off the job, leaving the home “unfinished and
uninhabitable.” Eventually, the Forbeses sued Prime for breach of
contract. After trial, the court found that Prime had materially breached,
but awarded only a small amount of damages. The trial court concluded
that “[t]he purpose of contract damages is to put the injured party in as
good a position as that in which full performance would have put him” and
the Forbeses had not presented evidence of the difference between the
market value of the home had it been completed and the value of the
construction which the contractor had furnished.

   Reversing the trial court, the Second District noted that an owner had
two alternative remedies:

        When a party seeks damages for a total breach, “[the party]
      may treat the contract as void and seek the damages that will

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      restore [the party] to the position he was in immediately prior
      to entering the contract.” Rector [v. Larson’s Marince, Inc.],
      479 So. 2d [783,] 785 [Fla. 2d DCA 1985]; see also McCray v.
      Murray, 423 So. 2d 559, 561 (Fla. 1st DCA 1982). Or, in the
      alternative, [the party] may instead “affirm the contract, ‘insist
      upon the benefit of [the] bargain, and seek the damages that
      would place [the party] in the position [which the party] would
      have been in had the contract been completely performed.’ ”
      Tubby’s Customs, [Inc. v. Euler,] 225 So. 3d [405,] 407 [Fla. 2d
      DCA 2017] (quoting Citizen’s Prop. Ins. Corp. v. Amat, 198 So.
      3d 730, 734 (Fla. 2d DCA 2016)). In the case of a breached
      construction contract like Prime’s contract with the Forbeses,
      the benefit-of-the-bargain remedy is “either the reasonable
      cost of completion, or the difference between the value the
      construction would have had if completed and the value of the
      construction that has been thus far performed.” Rector, 479
      So. 2d at 785 (citing Grossman Holdings Ltd. v. Hourihan, 414
      So. 2d 1037 (Fla. 1982) (adopting section 346(1)(a) of the
      Restatement (First) of Contracts (Am. Law Inst. 1932), to cases
      involving breach of a construction contract)).

         ....

      [T]he reason the Forbeses did not produce that evidence [of
      market value of the house] was because they did not seek
      benefit-of-the-bargain damages. They sought to be put in the
      position they would have occupied had they never contracted
      with Prime. It was clear at trial that the Forbeses regarded
      the breach as total; indeed, they were explicit that they were
      entitled to suspend their own performance under the contract.
      And the damages they asked the court to award—return of
      payments made under the contract and the equity in their
      home at the time of contracting—were of a type that regarded
      the contract as void and attempted to restore the Forbeses to
      their precontractual situation.       Those damages were
      inconsistent with an affirmance of the contract and request
      for damages approximating full performance.

Id. at 451–52.

   Similarly, Judet terminated the contract because of Cano’s breach and
treated the breach as total. The damages Judet sought in his counterclaim
were the type of damages which are inconsistent with the affirmance of the
contract and demand for full performance. The trial court entered

                                      4
judgment for Judet to place him in the position immediately prior to the
contract by returning the payments he made to Cano less the quantum
meruit value of Cano’s work. The trial court did not err in its measure of
damages under the facts of this case.

   Cano also claims that trial court decided an issue not within the pretrial
stipulation when it entered judgment for the amount Judet overpaid Cano.
In the stipulation, one issue for determination was:

      If Contractor did materially breach the contract, then what is
      the reasonable value of the labor, services and materials in
      place performed by Contractor and whether and to what
      extent Owner is legally obligated for payment to Contractor.

It did not expressly address the issue of recovery by Judet. However,
Judet’s complaint specifically pled for the relief the trial court awarded,
and the issue was raised and argued by Judet’s attorney at the close of
the trial without objection. Cano also did not object when Judet submitted
his proposed final judgment which included a judgment for Judet for the
overpayment.

    Generally “[p]retrial stipulations prescribing the issues on which a case
is to be tried are binding upon the parties and the court, and should be
strictly enforced.” Broche v. Cohn, 987 So. 2d 124, 127 (Fla. 4th DCA
2008) (quoting Lotspeich Co. v. Neogard Corp., 416 So. 2d 1163, 1165 (Fla.
3d DCA 1982)). A court may decide an issue outside of the pretrial
stipulation, however, where it is necessary to resolve the issues properly
before the court. Id.

    Broche serves as an example. There, Broche was an investor in a
corporation in which Cohn was the principal officer. The corporation
owned a parcel of property. The relationship between Broche and Cohn
deteriorated. Broche executed a quit claim deed for the property to himself
and his wife. Cohn also conveyed the property to himself. Cohn then sued
Broche. During the proceedings, Cohn, on behalf of the corporation, sold
the property to Mosler and then dismissed his suit. He retained the
proceeds of the sale. Broche then filed suit against both Cohn and Mosler.
Id. at 126.

    In the final judgment, the court found that Mosler was entitled to the
property. Id. It also found that the corporation, not Cohn, had legal title
to the property and thus the proceeds of sale. Cohn had breached his
fiduciary duty to the corporation by self-dealing. The court ordered Cohn
to reimburse the corporation for the proceeds of sale. Id.

                                     5
    While the parties had filed a pretrial stipulation, reimbursement to the
corporation of monies from the property sale was not listed. Nevertheless,
our court held that such relief was proper because it was a necessary
consequence of the court’s determination that the corporation was the
owner of the property prior to the sale. “[T]he issue of who was entitled to
the proceeds from the sale was properly before the court despite not being
listed in the pre-trial stipulation.” Id. at 128. “[S]tipulations are not to be
construed technically, but rather in accordance with their spirit and in
furtherance of justice.” Id. (quoting Fed. Land Bank of Columbia v. Brooks,
190 So. 737, 741 (1939)).

    Similarly, in this case the court’s judgment for Judet for the
overpayment was necessary once the court determined that Cano was
owed only $49,150 as the quantum meruit value of his services. From
that issue, it necessarily followed that the monies Cano had already
received should be returned to Judet. To hold otherwise would negate the
trial court’s determination that Cano was entitled only to the value of his
services. Thus, its resolution was implicit in the issues presented, the
pretrial stipulation notwithstanding.

    In sum, the trial court correctly determined the measure of damages
and properly and necessarily required Cano to pay Judet $49,150. We
affirm the final judgment.

   Affirmed.

CONNER, C.J., and GROSS, J., concur.

                             *        *         *

   Not final until disposition of timely filed motion for rehearing.

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