Main Electric. Ltd. v. Printz Services Corp.

980 P.2d 522 (Colo. 1999)

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Nature of the Case

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Facts

Printz (D) was a general contractor on a casino construction project. Main Electric (P) and C.J. Masonry (P1) were subcontractors on the project. The relationship between D and P1 was governed by a preprinted form contract prepared by D. That contract basically said that D would pay P1 when the owner made payments to D. P did not sign a written form contract but orally agreed to work for D. The owner became insolvent and lost the property in a deed of trust foreclosure. The owner failed to pay D and D failed to pay Ps. Ps sued for payment. D claimed in defense that it was obligated to pay its subs only if first paid by the owner. The trial court interpreted the clause in the contract (provided like payment shall have been made by Owner to Contractor) in P1’s contract to be a promise by D to pay when and not if the general contractor was paid by the owner. The trial court took the position that the general contractor remained unconditionally obligated to pay its subs provided the work was performed. It ruled that D was liable to P1 regardless of owner solvency. The trial court found that although P and D did not execute a written contract, an implied contract existed between the two and the court awarded P damages under quantum meruit. The court of appeals reversed. It held that the contract between P1 and D created a condition precedent rather than a promise to pay (Orman). As for P’s claim, the court of appeals reasoned that since both parties conceded that they had an express oral agreement, quantum meruit was inappropriate. Since the parties disputed whether the payment clause was part of their oral contract, the case must be remanded to resolve that disputed fact. The Colorado Supreme Court granted certiorari to determine if the holding in Orman controls this case.