Delaware Business Litigation Report

Superior Court Employs Objective Contract Principles, Grants SJ To Builder

Capano Homes, Inc. v. Syed, 2008 WL 4182039 (Del. Super. Ct. Sept. 8, 2008).

This decision implements the objective theory of contracts adopted by the Delaware courts.  The dispute involved a homebuyer who refused to proceed to settlement, claiming that the builder breached their written agreement and that the buyer should therefore be excused from performing.  The homebuyer alleged that the completed home did not meet the parties’ agreed upon specifications for the dimensions of the garage and type of veneer.  The court granted summary judgment to the builder.   

The court found that the builder did not breach the contract, and surely not in a material manner.  The court found that the buyer’s realtor had apparent authority to agree to the change to the garage dimensions and that, in any case, the buyer ratified the change by signing an updated schematic.  As for the change made in the style of veneer, the court found that the contract permitted the builder to make changes in the plans and specifications, so long as in the builder’s opinion, as opposed to the buyer’s, the change did not lead to a less structurally sound or aesthetically pleasing building.   

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