Cengage Advantage Books: Business Law 9th Edition by Arnold Goldman ,William Sigismond

Exercise 3

Grevas entered into a contract with the Surety Development Corporation to have a prefabricated house built for $16,385. A completion date was set, but according to Grevas, the house was not ready for occupancy on that date. As a result, Grevas refused to pay the balance due. Surety Development then sued for the money, claiming substantial performance. According to testimony at the trial, the house was actually far from finished on the morning of the date it was to be completed. Surety Development Corporation, however, initiated a crash program, with workers all over the place doing whatever was necessary to complete the house by the end of that day. In fact, by day's end, the house was finished and ready for occupancy, with only minor details to be completed. Grevas, who had taken a tour of the premises early in the morning of the completion date set in the contract, remarked that the house could not possibly be completely finished and ready for occupancy by the end of the day. Consequently, he never returned later that day to inspect the premises. Was the Surety Development Corporation entitled to the balance due on the house? (Surety Development Corp. v. Grevas, 192 N.E.2d 145)