Construction contracts frequently stipulate remedies available in the event of a contractor default. Are all these remedies available to the non-breaching party or must that party elect a single, most advantageous remedy and be satisfied with that?
The Connecticut Supreme Court was recently presented with a situation where a subcontractor had breached its agreement and lost its right to the subcontract balance. The sub did not challenge the finding of breach or the forfeiture of the subcontract balance; however, it argued that the prime contractor, having pocketed the subcontract balance, could not also recover damages for breach of the warranty of materials and workmanship. The court had to decide whether the remedies were duplicative and redundant or whether they were distinct and independent.
The other case in this issue involved a contractor name on a construction contract that deviated from the contractor name on the performance bond covering that contract. A California appeals court had to decide whether the project owner could enforce its rights against the bond.