K. Miller Construction Compay, Inc. v. McGinnis

SUPREME COURT CASES

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State: Illinois

Docket No: 109156 Rel

Case Date: 09/23/2010

Preview:Docket No. 109156.

IN THE SUPREME COURT OF THE STATE OF ILLINOIS

K. MILLER CONSTRUCTION COMPANY, INC., Appellee, v. JOSEPH J. McGINNIS et al., Appellants. Opinion filed September 23, 2010.

JUSTICE BURKE delivered the judgment of the court, with opinion. Chief Justice Fitzgerald and Justices Freeman, Thomas, Kilbride, Garman, and Karmeier concurred in the judgment and opinion.

OPINION The Home Repair and Remodeling Act (815 ILCS 513/15 (West 2006)) states that, "[p]rior to initiating home repair or remodeling work for over $1,000, a person engaged in the business of home repair or remodeling shall furnish to the customer for signature a written contract or work order." At issue here is whether a home remodeling contractor who violates this provision and enters into an oral contract for home remodeling work over $1,000 may enforce the oral contract or seek recovery in quantum meruit against a homeowner who has refused to pay for a completed home remodeling project. The appellate court concluded that such a contractor may not enforce the oral contract but may seek recovery in quantum meruit. 394 Ill. App. 3d 248. For the reasons that follow, we hold that

recovery is available under both theories. Background The plaintiff, K. Miller Construction Company, Inc., filed a second-amended complaint in the circuit court of Cook County against the defendants, Joseph and Frances McGinnis. The complaint alleged the following. Plaintiff is an Illinois construction firm whose sole owner is Keith Miller. Defendant Joseph McGinnis is an Illinois real estate attorney who has been in practice since 1970 and been a division counsel for United General Title Insurance Company for 10 years. Defendant Frances McGinnis is Joseph McGinnis's wife. Plaintiff has done remodeling work for defendants in the past and, prior to the initiation of this litigation, Joseph McGinnis and Miller were friends. In the spring of 2004, defendants purchased a three-flat apartment building in Chicago. Defendants intended to convert the building into a single-family residence by demolishing and rebuilding the interior of the building while retaining the building's exterior structure. Architectural plans were drawn up and several discussions took place among defendants, the architect and Miller about the scope and details of the work to be performed. In the fall of 2004, plaintiff entered into an oral contract with defendants to undertake the remodeling project as general contractor for the sum of $187,000. In December 2004 and January 2005, defendants told Miller that they wanted to "vastly increase" the work to be performed on the building and that the architect would develop new plans and specifications for the expanded project. The new work included, among other things, lowering of the basement foundation and floor, installation of steel beams and framework to replace wood materials, replacement of plumbing, installation of additional heating, ventilation and air conditioning, and related changes. These modifications raised the total cost of the project to approximately $500,000. Defendants instructed Miller to assist them in obtaining a new building permit for the construction changes. The permit was issued by the City of Chicago in January 2005. Plaintiff proceeded to perform the construction ordered by defendants according to the -2-

revised architectural plans and the new building permit. Defendants paid the first $65,000 of invoices issued by plaintiff from April 2005 to June 2005. In September 2005, plaintiff submitted an invoice to defendants for $58,000. Defendants refused to pay the invoice and told Miller they did not want to make any further payments until all construction work on the project was completed. Plaintiff was unable to finance the remainder of the construction on its own and, therefore, obtained a bank line of credit for $150,000 to complete the remodeling project. Defendants visited the construction site at least weekly in 2005 and 2006 to review and give approval to construction work plaintiff had performed. In June and July of 2006, defendants conducted final walk-throughs of the property. Defendants approved all of the construction work with the exception of certain flooring that defendants estimated would cost $300 to repair. Plaintiff's final day of construction on the project was July 10, 2006. Defendants made some additional payments to plaintiff but at the close of construction, the balance due to plaintiff for labor and materials furnished was over $300,000. Defendants refused to pay plaintiff any of this amount. Plaintiff thereafter filed a three-count, second-amended complaint against defendants. Count I sought to foreclose a mechanic's lien. Count II alleged a breach of contract. Count III, which was pled in the alternative, sought recovery in quantum meruit for the reasonable value of plaintiff's work. Defendants filed a motion to dismiss pursuant to section 2

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