Destruction of the Contract through Material Changes

ABSTRACT

This paper introduces the term ‘destruction of the contract’ to describe the various legal theories which can be used when the number of changes to a construction contract is so great the owner is considered to have legally destroyed the original contract. The advantage to the contractor, and disadvantage to the owner, of these doctrines is the contractor is not paid according to the original contract, but under the theories of promissory estoppel and/or quantum meruit, that is: the reasonable value of the work performed. This amount is usually higher than the contract amount. Contractors wishing to use this theory should reserve their rights when performing material changes on the project and the owner does not recognize the reasonable costs for those material changes.

Keywords:

• cardinal change
• abandonment
• destruction of the contract