Question

Powder Room Mess. For $300,000, Willis agrees to build a new home for Robert, who is very picky. Willis builds the home to Robert's specifications with one exception. The faucets and linoleum flooring in an upstairs powder room are not exactly what Robert specified. That was a mistake on Willis's part, but he had not intentionally failed to follow specifications. When Robert sees the powder room, he goes ballistic and tells Willis that he will not pay Willis anything for the house. It will take $300 to put in correct faucets and linoleum. Willis says that he is willing to pay $300 to put Robert in the position he would have been in had the correct faucets and linoleum been used, but that is all he is willing to pay. Which of the following is true regarding whether Willis breached the contract?

1) Willis did not breach the contract.
2) Willis materially breached the contract.
3) Willis substantially breached the contract.
4) Willis breached the contract, but the breach was not material.
5) Willis committed an anticipatory breach of the contract.

Answer 1

4) Willis breached the contract, but the breach was not material.

Step-by-step explanation:

Willis made a mistake when he was installing the floor and faucets in the powder room. But the mistake was not substantial, if you consider that the contract for building the house was worth $300,000 and it costs only $3000 to fix the mistake (that is only a 0.1%).

Under the substantial performance doctrine, we can consider that Willis performed his part of the contract and Robert must pay him for building the house. Substantial performance refers to a situation where a contact is not 100% complete, but almost 100% complete. In this case the contract is 99.9% complete, so Robert cannot use the powder room as an excuse to not pay Willis for his work.