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Constructive Conditions of Exchange: The Avoidance of Forfeiture

Case: O.W. Grun Roofing and Construction Co. v. Cope (1975; TX)

Facts: Parties contracted for Grun Roofing to install a new roof on Cope’s home
for $648.00. The contract specifically described the color of the shingles that
were to be put on the roof as a “russet glow.” Grun Roofing described this color
as a “brown varied color,” and further acknowledged that it was obligated to
install a roof of uniform color. After installation of the new roof, Cope noticed
that some of the shingles had streaks of yellow in them. After confronting Grun
Roofing, Grun Roofing agreed to replace the nonconforming shingles. However, the
replacement shingles failed to match the rest of the shingles on the roof.
Furthermore, Grun Roofing replaced only five of the shingles that had yellow
streaks in them instead of all the shingles with yellow streaks. The result was a
roof that was not of uniform color, and it was inferred from expert testimony that
it would not be unless the shingles would be replaced.

Issue: Whether a contractor’s performance, less than complete, amounts to


substantial performance of a contract? - Maybe, here no.

Holding: Judgment for P. Not substantial performance.

Reasoning:
• Rule: The doctrine of substantial performance allows for a promisor who has
substantially performed to recover, although he has failed is some particular way
to comply with the agreement.
○ However, in this case, court decided that there was no substantial
performance.
§ In order to constitute substantial performance, the contractor must:
□ Intend to comply with the contract in good faith
□ Shall have substantially done so in the sense that any defects
are not pervasive
□ Not deviate from the general plan, and
□ Any defects are not so essential that the object of the parties
in making the contract and its purpose cannot, without difficulty, be accomplished
by remedying them.
§ Substantial performance does constitute:
□ Omissions or deviations from the contract that are inadvertent
and unintentional
□ Not due to bad faith
□ Do not impair the structure as a whole, and
□ Are remediable without doing material damage to other parts of
the building.
○ Conclusion: The owner has a right to want his shingles a certain color,
and shouldn’t have to accept something else than what was bargained for. A
contractor who tenders a performance so deficient that it can only be remedied by
completely redoing the work for which the contract specified does not
substantially perform his contractual obligation.
§ Streaked roof-can’t be repaired has to be replaced, owner gets no
benefit, so no unjust enrichment

Notes
• Factors for substantial performance:
○ Purpose - keep water out, etc. - shelter
○ Desire - beauty
○ Excuse
§ Incompetence - He didn’t know how to do the shingles properly, to get
the desired color that the Cope's wanted
○ Cruelty of strict enforcement - change the whole roof! Pretty harsh.
• The aesthetic factor here is what differentiates it from the reading pipe case.
○ Reading case pg. 781 "Substitution of equivalents may not have the same
significance in the field of art on one side and in those of mere utility on the
other. Nowhere will change be tolerated, however, it is so dominant or pervasive
as in any real or substantil measure to frustrate the purpose of the contract."
○ Roofing case pg. 787 "A person has, particularly with respect to his home,
to choose for himself and to contract for something which exactly satisfies his
choice, and not to be compelled to accept something else. In the matter of homes
and their decoration, mere taste or preference, almost approaching whimsy, may be
controlling with the homeowner, so that variations which might, under other
circumstances, be considered trifling, may be inconsistent with that "substantial
performance."