## Facts

- Kirkland (plaintiff) contracted with Archbold (defendant) to repair and remodel Archbold’s home for a total price of $6,000.
- The payment schedule provided: $1,000 after 10 days’ work, $1,000 after 20 days’ work, $1,000 after 30 days’ work, $1,000 upon completion, and $2,000 thirty days after completion.
- Kirkland worked for about two months and furnished labor and materials reasonably valued at $2,895.
- Archbold paid Kirkland only $800 during that period.
- Archbold then prevented Kirkland from continuing the job because Kirkland failed to strictly comply with the contract specifications for the exterior-wall materials.
- Kirkland sued to recover the reasonable value of the labor and materials furnished, less the $800 already paid.
- The trial court treated the contract as severable and treated the $800 payment as a concession that Kirkland had earned the first $1,000 installment; it awarded Kirkland $200 and denied further recovery because of Kirkland’s subsequent breach.
- Kirkland appealed.

## Issues

1. May a contractor who materially deviates from construction specifications, and is stopped from continuing, recover in quantum meruit for the reasonable value of work and materials that benefitted the owner, subject to an offset for the owner’s damages?

## Decision

- The appellate court reversed and remanded.
- The court held that Kirkland’s failure to substantially perform barred recovery of additional contract installments as such, but did not automatically bar a restitutionary (quantum meruit) recovery for the value of benefits Archbold retained.
- The court rejected limiting Kirkland’s recovery to the unpaid balance of the first installment on a severability theory where the owner retained and used the partial performance.
- The court directed that any recovery in quantum meruit must be reduced by (a) the $800 already paid and (b) the damages or reasonable cost to Archbold caused by Kirkland’s nonconforming work and materials.

## Legal Principles

- A contractor who materially breaches a building contract generally cannot recover the contract price without substantial performance.
- Even a breaching contractor may recover restitution for the reasonable value of labor and materials to the extent the owner accepts and retains a benefit, to prevent unjust enrichment.
- Quantum meruit recovery is measured by the benefit conferred (often framed as the reasonable value of labor and materials retained) and is reduced by the owner’s damages attributable to the breach, including reasonable correction costs.
- A trial court should not confine restitution to a single unpaid contractual installment merely by labeling the agreement “severable” when the claim is for the net value of benefits retained after an incomplete, defective performance.

## Conclusion

Kirkland v. Archbold holds that although a contractor who uses nonconforming materials may be barred from recovering the contract installments due to lack of substantial performance, the contractor may still pursue quantum meruit for the reasonable value of the work and materials the homeowner retained, reduced by prior payments and the homeowner’s damages or reasonable correction costs caused by the breach.


Kirkland v. Archbold, 113 N.E.2d 496 (1953)