## Facts

- A warehouse owner contracted with a contractor to install a reinforced concrete floor system, including necessary columns and column footings, for a lump-sum price.
- The contractor began performance by removing the existing floor, cutting it away from the walls, placing concrete footings, building wooden forms for columns, and setting reinforcing rods in place for later embedment in concrete.
- Before the concrete floor and columns were completed, the warehouse was destroyed by fire without fault of either party, making completion impossible.
- The owner had obtained insurance on the building before the contract and collected insurance proceeds after the fire; the owner declined the contractor’s request to rebuild so the work could be finished.
- The contractor sued for compensation for labor and materials furnished before the fire, and the trial court awarded a substantial recovery.
- The owner appealed, disputing both entitlement to recovery and the proper measure of recovery.

## Issues

1. Whether a contractor may recover in restitution for partial performance when the structure is destroyed without fault before completion of a construction contract.
2. If restitution is available, whether recovery is limited to the value of work and materials that, at the time of destruction, had become sufficiently identified with the structure to benefit the owner as contemplated by the contract.
3. Whether the owner’s insurance recovery or refusal to rebuild can supply a basis to expand or justify the contractor’s recovery.

## Decision

- The Kansas Supreme Court reversed and remanded for additional evidence and recalculation of recovery under the proper standard.
- Recovery could not be based on the owner’s refusal to rebuild or on the owner’s collection of insurance proceeds.
- Restitution was limited to contract work done that, at the time of the fire, had become so far part of the structure that it would have benefited the owner as contemplated by the contract but for the destruction.
- The contractor could recover for (a) cutting the old floor away from the walls and removing the old floor and (b) installed concrete footings.
- The contractor could not recover for temporary wooden forms or for reinforcing rods and related labor where the rods had not yet been embedded in concrete and thus had not become part of the structure.
- A dissent would have treated the tied-together upright rods as part of the building and compensable.

## Legal Principles

- When an improvement contract becomes impossible to complete due to accidental destruction without fault, the contractor’s remedy is restitution for benefits conferred and retained, not the full contract price.
- The measure of restitution is the value of labor and materials that, at the time of destruction, were sufficiently integrated with the structure such that they would have inured to the owner’s benefit as contemplated by the contract absent the casualty.
- Preparatory work and temporary construction devices that would have been removed on completion do not constitute a compensable benefit to the owner.
- Materials staged or positioned for later incorporation are not compensable if they have not yet been incorporated into the structure in the manner required to produce the contemplated benefit.
- The owner’s insurance proceeds and post-casualty decision not to rebuild do not expand the owner’s restitutionary liability.

## Conclusion

The court limited a partially performing contractor’s recovery after a no-fault fire to the value of work and materials that had already become part of the structure in a way that would have benefited the owner under the contract, excluding temporary or unincorporated items and rejecting reliance on insurance proceeds or refusal to rebuild.


Carroll v. Bowersock, 100 Kan. 270, 164 P. 143 (Kan. 1917)