Delaware Business Litigation Report

Brasby v. Morris, No. 05C-10-022-RFS, 2007 WL 949485 (Del. Super. Ct. Mar. 29, 2007).

A homebuyer brought this suit for breach of contract, negligence, and fraud after the builders delayed construction of his new modular home. The initial sales contract did not set a date for completion, but the parties entered into a subsequent, separate agreement setting a specific deadline. The defendants assured plaintiff they would finish by this date, but the buyer became concerned upon learning that no physical structure had been erected. So he demanded written assurance of timely performance or return of his deposit. The defendants responded, but informed the buyer that construction was 30 days behind schedule. 

The plaintiff, then, filed a complaint with the Delaware State Police seeking return of his deposit. And, the builders returned most of it. Soon thereafter, the buyer brought this action in Superior Court, and the builders moved for summary judgment.     

The court denied the motion as to the contract claims, holding that there existed material issues of fact that could only be resolved at trial. On plaintiff’s claim that time was of the essence, the court observed that while the original sales contract did not state that time was of the essence, nor did the modified agreement, there remained a fact question of whether the dealings between the parties created such a condition. On plaintiff’s claim for material breach, the court found that whether there was such a breach excusing performance depended on the factual question of whether time was of the essence. Moreover, the court found that there was a material question of fact as to whether the builders' return of less than the full amount paid by plaintiff homebuyer was meant to satisfy all claims between the parties or to be a partial payment.

The court did, however, grant the defendants’ motion as to the tort claims for negligence, negligence per se, and fraud. These claims were precluded by the economic loss doctrine, which prohibits claims in tort where overlapping claims based in contract adequately address the injury alleged.