Lindenwood Contactors entered into a contract with Saul Goodman to build a profe

Question

Lindenwood Contactors entered into a contract with Saul Goodman to build a professional office building for Goodman at a cost of $5,800,000. Goodman provided Lindenwood with the specifications for the office building. Lindenwood used less expensive materials in the hardwood flooring and wall coverings than required under the contract. Lindenwood did not follow the building specifications for the panic room that was to be installed behind Goodman's office. Lindenwood also did not install the cables and circuits to wire Goodman's conference room for video and audio technology. An inspection of the office building showed that the building generally conforms to the contract requirements and is generally fit for the purpose of a professional office building. However, Lindenwood's substitution of materials, failure to follow the requirements for panic room and failure to wire the main conference room lessened the value of the office building by $614,000. Goodman contends that Lindenwood materially breached the construction contract and refuses to take possession of the office building. Goodman also refuses to pay Lindenwood anything on the contract. Lindenwood sues Goodman for $5,800,000 in damages. To what amount of damages, if any, is Lindenwood entitled? Explain.

Explanation / Answer

Since the Contract breach is a Major Breach i.e of the Materials, in this case Goodman is in the better position and have upper hand over Lindenwood.

Since the inspection of the building has made it clear that there were major flaws in the construction and the value of the contract is lessened by $614,000, Lindenwood is entitled to bare this amout of damages.

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