Question

Mardy, a general manager contractor is building a house. He contracts with Plumbco to do all the plumbing for $10,000. Before Plumbco begins the work, they contact Mardy and say that another company is going to show up and do the work instead. Mardy does not respond. When the other company fails to perform, Mardy sues.

Is this novation or delegation?

Answer 1

The circumstance presented is a case of attempted delegation, not novation, as there was no consent from Mardy, and the original contract with Plumbco was not replaced by a new agreement.

Step-by-step explanation:

The scenario described involves a general manager contractor, Mardy, who has a contract with Plumbco for plumbing services in a house build.

When Plumbco informs Mardy that another company will perform the work instead, without Mardy's response or approval, this suggests an attempted delegation of duties.

Novation is a process where a new contract is created, replacing the old one and requiring the consent of all parties involved. Since Mardy did not agree to the new arrangement and the original contract was not formally dissolved, this is not a case of novation.

However, if the other company had performed the work satisfactorily, it could have implied that Mardy accepted the delegation. Since the other company failed to perform, and there was no novation, Mardy can hold Plumbco liable for breach of contract.