Disputes between a business or property owner and a contractor, or even between a general contractor and subcontractors, can derail construction projects and result in costs far exceeding estimations for construction or renovation projects. The Rhode Island Supreme Court recently ruled on an appeal to determine if an architect was entitled to contract damages for work that was never completed.
At the heart of this legal dispute lies a contractual agreement between an architectural firm and a restaurant. The restaurant hired an architectural firm to design a construction plan for renovating the restaurant property after a winter storm damaged the roof. The parties agreed that the plaintiff would prepare and deliver plans for the renovation, and the defendant made a partial payment toward the contract. According to the facts discussed in the opinion, the defendant stopped paying on the contract and abandoned their plan to use the plaintiff’s services to renovate the building. As a result, the plaintiff sued the defendant for the remaining balance due under the contract.
The court’s ruling centered on the existence of a binding contract, substantiated by a fixed lump-sum fee arrangement for architectural services. This arrangement mandated that the architect would receive predetermined compensation for his architectural work, disbursed in installments linked to specific project milestones. Regrettably, the defendant defaulted on their end of the deal, not only abandoning the contract but also discontinuing payments to the architect.