Callano v. Oakwood Park Homes
1966 New Jersey Superior Court
• Oakwood was seller, Pendergast was potential buyer. Pendergast contracted with Callano to do some landscaping work.
• Pendergast dies, family cancels sale, Oakwood sells to the Grantges for more. (this as likely the reason Oakwood let Pendergast family out of purchase–they knew they could get more).
• “In cases based on quasi-contract liability, the intention of the parties is entirely disregarded, while in cases of express contracts and contracts implied in fact the intention is of the essence of the transaction. In the case of actual contracts the agreement defines the duty, while in the case of quasi -contracts the duty defines the contract. Where a case shows that it is the duty of the defendant to pay, the law imparts to him a promise to fulfill that obligation.”
• Why did Callano sue Oakwood Park Homes rather than Pendergast? Cost of suing well exceeds recovery for breach of contract; however, possibility of restitution damages could outweigh litigation costs. No ‘repeat offender’ incentive to litigate.
• Why can’t Callano sue Grantges? Grantges were not unjustly enriched–they paid for shrubbery.
• Court won’t grant relief because they don’t want people to be able to substitute one person’s obligation for another’s. Callanos could have sued Pendergast (even though it wouldn’t have been economical). Court does not want to give person ‘more than benefit of the bargain’–giving them the benefit of two contractual liabilities rather than one.
• Court might allow liability when relationship between party that made contract and party that was benefitted is much closer. E.g., if one person has express authority to act for another.
• When plaintiff’s loss is not equal to defendant’s gain, damages become difficult issue. Under restitution theory, damages should be defendant’s gain, but this does not always seem just.
• When there is a ‘thorny’ liability issue, sometimes you will decide there is no liability in the first place.
Conclusion
Notes
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References and Further Reading
About the Author/s and Reviewer/s
Author: international