Argee Corp. v. Solis
932 S.W.2d 39 | Texas Court of Appeals, 9th District (Beaumont) | 1995
What This Case Means for Subcontractors
Argee Corp. hired Solis as a subcontractor for steel and concrete work on three Texas prison projects. Argee failed to pay Solis on time, forcing Solis to abandon two projects. The court ruled that because Argee breached the payment obligation first, Solis was excused from following strict procedural requirements in the contract (like formal change order procedures) and could recover damages. This means a contractor cannot hide behind contract technicalities when they're the one who broke the deal.
Key Takeaways
- •If your general contractor fails to pay you on time, you may be excused from following strict procedural deadlines in the contract—don't let them use technicalities against you after they breach.
- •Document all non-payment issues and your attempts to continue work despite lack of payment; this evidence supports your claim that the GC's breach forced you to stop.
- •A breaching party loses the right to enforce procedural requirements for claims and change orders—focus on proving the GC's payment failure, not on whether you followed every procedural step.
A breaching party relinquishes its contractual procedural rights concerning claims for additional costs.
Frequently Asked Question
If my general contractor doesn't pay me, can they claim I violated contract procedures?
No. Texas courts have ruled that when a general contractor breaches by failing to pay, they lose the right to enforce strict procedural requirements against you. Your failure to follow procedures is excused by their breach. Focus on proving non-payment and documenting your damages.
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A standard merger clause without clear and unequivocal language expressly disclaiming reliance does not bar a fraud claim, even in a commercial lease agreement between parties.
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A municipality owes no duty to a subcontractor to ensure a general contractor provides valid payment bonds, and a subcontractor cannot recover from the municipality under quantum meruit, unjust enrichment, or negligence theories when the general contractor abandons the project.