Existence of a Contract Does Not Always Preclude a Quantum Meruit Claim
Construction law practitioners and construction professionals often cite the age-old axiom that existence of an express contract bars
a claim for quantum meruit in denying quasi-contractual causes of action in breach of contract cases. The Georgia Court of Appeals has found that in
some instances parties may recover for breach of contract and for quantum meruit where the owner requested and received additional work but
did not pay for it.
In One Bluff Drive, LLC v. K.A.P., Inc. 330 Ga. App. 45 (2014), the property owner and contractor had agreed to a “base bid”
number for the contractor to supervise construction of a residential project. Because the property owner had replaced the original architect, the contractor
provided a base bid number that would be subject to adjustment if the owner made any changes to the scope of work. Over the course of the project,
the owner made a number of significant changes to the scope of work, including replacing work that had already been performed. The end result was that
the contractor claimed the owner owed roughly an additional $400,000 above the amount of the base bid.
The contractor filed suit without listing a specific cause of action for either breach of contract or quantum meruit. Instead, the
contractor alleged that it entered into a contract with the owner, but that the owner had made significant changes in scope and that the contractor
was not compensated for the reasonable value of its work. The owner argued that the base bid was the agreed-upon contract amount, and that it was not
liable for any amounts above that base bid. The owner also argued that since the contractor had not specifically pled quantum meruit, the contractor
should not be able to recover under that theory.
The Court of Appeals held that under the Civil Practice Act, there is no requirement for pleading both breach of contract and quantum
meruit, where a “fair inference” can be made of a claim for quantum meruit. The court court affirmed the lower court’s ruling that quantum meruit could
be inferred from the complaint. Further, the Court of Appeals stated that notwithstanding an express agreement, work performed outside of the scope
of that agreement may be recoverable under quantum meruit.
Two major takeaways from this case: First, a court may read in a claim for quantum meruit into a breach of contract claim, even if
one was not explicitly alleged. Second, even where parties have express contracts for construction, work outside of the scope of that contract may
be recoverable in quantum meruit. The first point is difficult to protect against because different courts may choose to exercise their discretion
in varying degrees. The second point may be mitigated by ensuring that any work not included in the original scope of work is only performed in accordance
with a written change order.