FEDERALDistrict Court, D. New Jersey
1994

Linan-Faye Construction Co. v. Housing Authority

847 F. Supp. 1191District Court, D. New Jersey • Decided 1994Enforced

HOLDING

A contractor on a Camden housing renovation project sued after the owner terminated the contract for convenience. The court ruled that when a contract includes a termination-for-convenience clause, the contractor cannot recover damages for problems that happened before the termination, even if the owner was at fault. The court also said delays in formally labeling the termination don't create additional damages. This means termination-for-convenience clauses are final—they cap what you can recover.

KEY FINDINGS

Termination for Convenience

If your contract has a termination-for-convenience clause, you cannot sue for damages from owner breaches or delays that occurred before termination—those claims are blocked by the clause itself.

Dispute Resolution

Do not rely on arguing the owner delayed in formally calling it a 'termination for convenience' to recover extra damages; courts will not award damages based on labeling delays.

FULL COURT OPINION