David M. Duree and Associates, P.C.
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Subcontractor recovers under Quantum Meruit and Unjust Enrichment Notwithstanding its breach of the Subcontract

On Behalf of | Nov 10, 2018 | Uncategorized

A Subcontractor for a metal canopy at O’Hare Airport installed 1,000 feet of defective welds out of 39 miles of total welds.  The defective welds were a material breach of the subcontract permitting the General Contractor to withhold payment, under the rule a party which materially breaches a contract cannot take advantage of the terms of the contract which benefit it, and cannot recover damages from the other party.  The General Contractor recovered a judgment for $27,500,000 against the Subcontractor.  But the Subcontractor was allowed to recover unpaid subcontract balances totaling $4,771,000 under the theory of Quantum Meruit which provides for reasonable compensation for value provided over and above the injury suffered by reason of the Subcontractor’s breach.  That judgment was also upheld under the theory of Unjust Enrichment.  No Set-offs were allowed.  LB Steel v. Carlo Steel Corp. (Illinois Appellate Court, 1st dist., Sept. 2018).