Acceptance and Defects - Building Contract - page 189

to and by using the sewer they became bound to pay the agreed price, less the cost of
building the 'pumping main'.
MCLENNAN JA: I turn now to the main ground of appeal which is that the plaintiffs contracted
to build the works for a lump sum, that is, it was an entire contract which the plaintiffs aban-
doned for their own purposes and are not entitled to claim under it on the principle stated in
Sumpter v. Hedges (1898) and Bradley v. Horner (1957). A subsidiary proposition is that there
is no evidence upon which to fix any amount on a quantum meruit . With that subsidiary
proposition I agree and the plaintiffs' case must stand or fall on a claim under the contract.
In Sumpter v. Hedges , the plaintiff, a builder, agreed to erect buildings on the defendant's
land for a lump sum. After he had done part of the work he abandoned the work for lack of
funds. The defendant completed the buildings. In Bradley v. Horner , the plaintiff, a painter,
agreed to paint the interior of a house for a lump sum but abandoned the work before it was
half finished. In both cases the actions were dismissed because of the rule that where there is
a contract to do work for a lump sum the price cannot be recovered until the work is com-
pleted. Other cases such as Dakin & Co. Ltd v. Lee (1916), and Hoenig v. Isaacs (1952), illustrate
the modification of the rule. In cases where there is substantial performance of the contract,
a defendant who gets the benefit of substantial performance is liable on the contract for the
agreed price less the cost of making good the omissions.
There was no substantial performance in this case. The construction of a pumping station
was a term of the contract, performance of which was essential to its completion because the
whole purpose of the contract would be defeated if the pumping station were not erected. In
Sumpter v. Hedges and cases of a like nature, where there was no substantial performance, the
argument was advanced that because the defendant took possession and received the benefit
of the plaintiff 's work he ought to pay for it on a quantum meruit but as the judges in Sumpter
v. Hedges pointed out the defendant was always in possession and had no option as to whether
he would take the benefit of the work or not.
There is, of course, a vital distinction between the facts in Sumpter v. Hedges and in Bradley
v. Horner and this case. The works which the plaintiffs agreed to construct were not on the
defendant's land and the contract was in the nature of a joint venture in that the completed
works were for the mutual use and advantage of both parties and the defendant accepted the
advantage and used the works. In Sumpter v. Hedges , A.L. Smith LJ, in relation to the facts of
the case said, 'the plaintiff having abandoned the contract, what was the owner to do? He
cannot keep buildings in an unfinished state on his lands'. The answer to the same question
put about the defendant in this case is I think quite a different one. The works were not being
constructed on the defendant's land, and the defendant did not have to accept the benefit of
the works constructed by the plaintiffs but could have constructed its own sewer on the ease-
ments it held when it became aware of the plaintiffs' breach.
Counsel for the defendant laid great stress on the conclusion of the learned trial judge that
the plaintiffs had abandoned the contract, as if abandonment discharged the contract and put
an end to the obligations on both sides. It may well be that the inference made by the learned
trial judge that the plaintiffs abandoned the contract is warranted but whether it was an
abandonment or a refusal or neglect to perform an essential term is largely, I think, a question
of semantics. I would prefer to put it this way. Because the plaintiffs did not perform an
essential term of the contract the defendant had a right to terminate it and put an end to its
obligation but until it did the contract was not discharged nor was the defendant's obligation
discharged.
The authorities to which I refer for this proposition are recent decisions of the House of
Lords: Heyman v. Darwins Ltd (1942), and White and Carter (Councils) Ltd v. McGregor (1962).