Sumpter v Hedges [1898] 1 QB 673

Facts

• The claimant, a builder, contracted with the defendant to construct two houses and stables on the defendant’s land for a lump sum of £565.
• The claimant commenced work and completed a little over half of the project, valued at about £333, before abandoning the contract.
• The defendant completed the remaining building work using the claimant’s materials.
• The claimant sought payment for the work done and materials supplied.
• At first instance, the court awarded the claimant the value of the materials used, but denied payment for the partially completed work.
• The claimant appealed, arguing for a quantum meruit for the value of the work performed prior to abandonment.

Issues

1. Whether a party who abandons a lump-sum contract is entitled to claim payment for partial performance.
2. Whether the other party’s continued use or benefit from partially completed work implies a new contract or obligation to pay for that work.
3. Under what circumstances a claim for quantum meruit arises when performance under a lump-sum contract is incomplete.

Decision

• The Court of Appeal dismissed the claimant’s appeal.
• The claimant was not entitled to quantum meruit for the partial completion of the building works after abandoning the contract.
• The court held that, to imply a new contract requiring payment for partial performance, there must be clear evidence that the other party had a genuine option to accept or reject the partial work.
• In cases of building contracts on land, the innocent party generally has no real option but to accept the incomplete works left on their property; thus, mere acceptance of the incomplete structure does not establish an implied agreement to pay.
• The claimant was entitled only to the value of the materials that the defendant used to finish the construction.

Legal Principles

• Where a lump-sum contract is abandoned before completion, the abandoning party cannot claim payment for partial work unless a new contract to pay can be inferred.
• An implied contract for payment can arise only where the innocent party had a true choice to accept or reject the partial performance.
• Mere retention or use of partially completed work, especially in construction on land, does not automatically constitute acceptance or agreement to pay for that work.
• The principle contrasts with the doctrine of substantial performance, which allows payment, subject to deductions, where the contractor has completed nearly all of the obligations with minor defects.
• Sumpter v Hedges is a key authority that reinforces the necessity for complete performance in lump-sum contracts and clarifies the narrow circumstances in which quantum meruit may be claimed after abandonment.

Conclusion

Sumpter v Hedges [1898] 1 QB 673 confirms that a party abandoning a lump-sum contract cannot recover for partial performance unless a new contract for such payment can be clearly inferred from the other party’s conduct. Merely accepting the incomplete work does not suffice, particularly where the innocent party had no real option to reject it. The decision remains significant for defining the boundaries of recovery under quantum meruit and upholding the enforceability of entire obligations in contract law.