The appellant’s brief in Scheck Industrial Corp. v. Tarlton Corp., 2014 WL 832773 (Mo. App. E.D.), in part raises an issue of contract that creates some difficulty. An obligor renders allegedly defective performance. The obligee says nothing at the time. Has the obligee released the right to damages arising from the inadequacy of performance?
The brief states:
Even assuming arguendo, that Tarlton believed Scheck’s work was somehow defective, by failing to notify Scheck of those defects, Tarlton effectively accepted Scheck’s work and waived its right to later complain that it was non-conforming. See Havens, 613 F.Supp. at 527 (where a contractor accepts work of its subcontractor without complaining, within a reasonable time, of defects or contract deviations which are known to him or which are open, obvious and apparent, the contractor is precluded from later asserting those defects or deviations).
Id. at *42 (emphasis added).
Let’s put this question in context. An obligor initially is required to provide a particular performance. Would an express agreement releasing the obligor from some of its duties be enforceable? Ordinarily not. Why? That is an attempt to modify the contract. Where a modification is not supported by consideration, at common law the modification is unenforceable.
The Restatement goes wobbly on this (as it goes wobbly in a number of places)….
More after the break …