Last week, the Third District Court of Appeal held that a contractor may not be entitled to summary judgment in an amount equal to the claimed contract balance less the owner’s claimed set-off where the contract at issue provided for both (1) prevailing party attorney’s fees and (2) that the owner could withhold payment for damages incurred. The Third District found that attorney’s fees were damages under the contract, were properly pled and, therefore, must have been considered as part of the owner’s set-off.
At the trial court level, the contractor moved for summary judgment without refuting the owner’s affirmative defense of set-off due to the contractor’s alleged defective work. The trial court granted summary and the owner appealed. On appeal, in support of its contention that the trial court properly granted summary judgment, the contractor argued that even if it did not properly refute the owner’s set-off defense, the contractor should still be entitled to partial summary judgment in the amount equal to the claimed contract balance less the costs to repair the contractor’s defective work. The Third District disagreed and found that the owner was justified in withholding an amount greater than the actual corrective work costs since the contract contained a prevailing party attorney’s fee provision and attorney’s fees are damages under the contract. Since the contract also allowed the owner to withhold payment for damages incurred, the Third District held that the entry of partial summary judgment without consideration of damages in the form of attorney’s fees was error.
Click here for a copy of the decision.
Author(s): Samuel I. Zeskind
