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How To Measure Damages In Breach Of Construction Contract Cases

Your contractor walks off the job leaving your property unfinished and uninhabitable. You are forced to hire a new contractor to finish the job. You file a lawsuit against the initial contractor for breach of the construction contract. What damages are you entitled to under Florida law?

The Fourth District Court of Appeal in Cano, Inc. v. Judet, 2021 WL 4301625 (Fla. 4th DCA 2021) recently held that Florida law provides owners with two alternative measures of damages in construction contract cases where the contractors have committed a total breach of the construction contract.

First, the owner may treat the contract as void and seek damages that will restore the owner to the position he was in immediately before entering the contract. Or, in the alternative, the owner may instead affirm the contract and insist upon the benefit of the bargain, and seek damages that would place the owner in the position he would have been in had the contract been completely performed. The benefit of the bargain remedy is either the reasonable cost or 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.

In Cano, the Fourth District Court of Appeal affirmed the trial court’s award of damages to the owner where the owner had selected the first type of available damages. The appellate court held that the trial court properly required the contractor to return the payments the owner paid to the contractor less the quantum meruit value of the contractor’s work.

Rosenthal Law Group handles construction litigation for both owners and contractors. Rosenthal Law Group is here to assist you with all your construction disputes.