Realize There’s Been a Miscommunication? Don’t Wait to Clear It Up! Or Else . . .

Miscommunication happens. Unresolved miscommunication leads to disputes. More importantly, recognizing a miscommunication and then lying in the weeds will come back to bite you. That is the lesson from a trial court decision in Maine.

Homeowners were interested in a timber-frame home, and consulted with a builder who specialized in that work. After reviewing a couple of recently built homes and discussing budgets, the parties agreed on construction of a timber-frame home for $275,000 on Mount Desert Island. For that amount, the builder thought he was providing a watertight house, with the exterior complete but the interior unfinished ("dried shell structure" per the builder) – but of course he was willing to do additional work at a quoted rate of $32/hour plus the cost of materials. The homeowners thought that $275,000 was getting them a complete house, ready inside and out to move in and occupy. The court specifically found: “Each of the parties mistakenly proceeded under the assumption that the other party shared that party's understanding of the scope of the work to be performed for $275,000.”

The builder, who had been doing this work for many, many years, had no interest in written contracts. So, nothing was in writing. One major opportunity lost, to identify the miscommunication.

The homeowners came to the realization at some point, when they had paid close to the $275,000, that what they expected to get for $275,000 was not the same as what the builder expected to provide.

But they said nothing.

The homeowners kept paying the bills, planning to sue to recover everything paid in excess of $275,00, once the job was done. They eventually paid the builder $601,195.75 for the finished house.

The trial judge apparently did not think very highly of the homeowners’ strategy, finding that the value of the work approximated the amount paid, and awarding $640.77 back to the homeowners.

The judge’s decision does not explicitly state the principle applied, but it is easy to read between the lines: once the homeowners became aware of the miscommunication, they needed to speak up. By failing to speak up and clarify what they were getting for $275,000, they led the builder to believe there was, in fact, no miscommunication. And the builder was entitled to recover in quantum meruit for the fair value of the work.

Even if the situation began with each side genuinely believing its own position, there came a time when one side realized the other wasn’t in agreement. The time to clarify was then, not later. This is a valuable lesson to keep in mind, the next time you realize that two parties have differing ideas of what they agreed upon. The case is Sweet v. Carl & Elizabeth Breivogel, 2017 Me. Super. LEXIS 219 (Nov. 16, 2017).

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