Rich & Whillock, Inc. v. Ashton Development, Inc

204 Cal. Rptr. 86 (1984)

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Nature of the Case

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Facts

Britton (D) signed a contract for grading and excavating by P at a price of $112,990. The work was to be done for Ashton (D). Britton (D) was general contractor. P encountered rock on the project site. Everyone agreed the rock would have to be blasted. The contract price expressly excluded blasting. The contract also stated 'any rock encountered will be considered an extra at current rental rates.' P estimated the extra cost to remove the rock would be about $60,000, for a total contract price of approximately $172,000. P also emphasized, the estimate was not firm, and the actual cost could go much higher due to the unpredictable nature of rock work. Britton (D) directed P to go ahead with the rock work and bill him for the extra costs. After receiving payments totaling $190,363.50, P submitted a final billing for an additional $ 72,286.45. Britton (D) refused to pay. P told Britton (D) he would 'go broke' if not paid because they were a new company, the project was a big job for them, they had rented most of their equipment, and they had numerous subcontractors waiting to be paid. Britton (D) replied that he would pay them $50,000 or nothing. Britton (D) presented an agreement for a final compromise payment of $50,000 wherein $ 25,000 would be paid 'upon receipt of this signed agreement,' to be followed by a second $25,000 payment on August 10, 1981. P protested and said he was on the verge of going out of business. P was told to just take it or leave it. P signed the agreement and received a $ 25,000 check after stating the agreement was 'blackmail' and he was signing it only because he had to in order to survive. P filed this action for damages for breach of contract for the $22,286.45 balance due. The court found Ds 'never really disputed the amount of P's charge in that they never asked for an accounting nor documentation concerning the extra work.' The court impliedly found Ds acted in bad faith and that the final agreement and release were signed 'under duress. P was awarded the $22,286.45. Ds appealed.