Victory for client: Court affirms contractor's right to cure workmanship issues
In a September 2019 decision favorable to contractors, the Arizona Court of Appeals upheld a contractor's right to have notice of, and a reasonable opportunity to cure, its alleged workmanship issues before it can be found in breach of contract.
In May 2015, Handyman Connection entered into a contract with two homeowners to remodel the home's master bathroom. The total contract price was $7,125, and the homeowners made a $2,850 down payment.
When work commenced on the bathroom in July 2015, the homeowners verbally expanded the scope of the project. The project progressed smoothly at first, but in September the homeowners began complaining about Handyman's work and service. Handyman worked to resolve the homeowners' complaints - repairing and replacing items at its own cost, including items that were not Handyman's responsibility - but was constantly met with new grievances.
For example, the homeowners were unhappy with the appearance and functionality of the vanities that they ordered for the bathroom. Although the materials were the homeowners' responsibility, Handyman trimmed the vanity drawers to improve their functionality. When that result did not please the homeowners, Handyman ordered new drawer fronts from the manufacturer, only to receive complaints from the homeowners about manufacturing blemishes.
In October, Handyman offered the homeowners a credit in lieu of additional repairs but made clear that, if the homeowners preferred, Handyman would fix the remaining grievances.
In response to Handyman's offer, the homeowners:
- refused to let Handyman complete the project,
- refused to pay Handyman the balance of the contract price and for verbal change orders that expanded the scope of the project, and
- sued Handyman for $200,000.
The homeowners moved for a new trial. Their motion was denied, and they appealed.
At the Court of Appeals, Handyman was represented by our firm in its cross-appeal. In unanimously affirming the trial court's refusal to grant a new trial, the Court of Appeals noted that the jury was correctly instructed on a contractor's right to cure, as follows:
- "A contractor has the right to cure its allegedly deficient work, and the contractor must be afforded a reasonable opportunity to cure those alleged defects. No curable breach can be deemed sufficiently material to warrant termination of the contract without the breaching party first having been given notice of and an opportunity to cure the breach."
- the homeowners did not act reasonably in preventing Handyman from completing its obligations under the contract, and
- alleged "technical violations" of the contract by Handyman did not amount to a material breach.
With respect to the partial award of attorneys' fees, the Court emphasized the importance of including attorneys' fee language in a construction contract. In particular, the Court found that the trial court erred by limiting the attorneys' fee award to Handyman on the basis of hardship because the parties' contract included an attorneys' fee provision.
"Attorney's fees requests according to contract are presumed reasonable absent evidence of its unreasonableness," the Court stated, going on to note that reasonable fees should be awarded in full unless the party that is ordered to pay can show that the full fees are excessive.
