When Is a Construction Contract Considered Abandoned In California ?
A construction contract may be considered abandoned "when an owner imposes upon the contractor an excessive number of changes such that it can fairly be said that the scope of the work under the original contract has been altered . . . ." (In Peterson v. Superior Court (1995), 172 Cal. App. 3d at p. 640.)
In Peterson, the court of appeal agreed that the contract had been abandoned because the construction drawings were incomplete and the project was substantially redesigned by the owner after the contract was awarded. (Id. at pp. 639.)
The redesign was "extensive" and "beyond the contemplation of the parties when the contract was first executed." (Id. at p. 642.)
The Peterson court also noted that, because of time pressure, "many of these changes were made without following the procedures provided for in the written contract." (Id.)
In Dodge v. Harbor Boat Bldg. Co. (1950), a contract to renovate two naval vessels was abandoned where, "the original specifications and directions with respect to the work were altered and supplemented so extensively and in so many particulars as to render it impossible for the trial court to segregate the work originally agreed to be done by [the subcontractor] from the total work that was required to complete the jobs . . . ." (Dodge v. Harbor Boat Bldg. Code, supra, 99 Cal. App. 2d at p. 790.)
Opdyke & Butler v. Silver (1952) concluded that a contract to renovate a building was abandoned where the owner required "numerous changes . . . many of which must have interrupted the orderly progress of the work, materially increased the contractor's cost and forced the doing of the work under disadvantageous circumstances." (Opdyke & Butler v. Silver, supra, 111 Cal. App. 2d at p. 918.)
The court was also persuaded by evidence that the parties did not comply with a contract term requiring written change orders and that they made "no serious attempt . . . to follow the contract requirement of separately charging for extras." (Id.)
Daugherty Co. v. Kimberly-Clark Corp. (1971) 14 Cal. App. 3d 151, 92 Cal. Rptr. 120, held that, "Abandonment of a contract may be implied from the acts of the parties. (Opdyke & Butler v. Silver (1952) 111 Cal. App. 2d 912, 916 [245 P.2d 306].)
Abandonment of the contract can occur in instances where the scope of the work undertaken greatly exceeds that called for under the contract." (14 Cal. App. 3d at p. 156.)
There, issues of fact precluded summary judgment in an action alleging that a contract to renovate a paper mill had been abandoned.
"Because of the tremendous number of changes, there was an issue as to whether the contract had been abandoned by the parties and they proceeded apart from the contract. There was evidence that the job was completely redesigned after the contract was entered into." (Id.)
The court also noted --that, "the parties consistently ignored the procedures provided by the contract for the doing of extra work." (Id.)