AI Generated Opinion Summaries

This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.

Facts

• Unified Contractor, Inc. (Unified) entered into a contract with Albuquerque Housing Authority (AHA) to provide construction services at four residential properties. Disputes arose regarding the application of elastomeric coating and the use of approved materials, leading to AHA terminating the contract. Unified claimed AHA failed to provide notice of billing disputes within ten days and to make prompt payment for undisputed invoiced items, while AHA counterclaimed for breach of contract due to Unified's failure to apply elastomeric coating according to manufacturer's specifications and making intentional misrepresentations (paras 6-19).

Procedural History

• District Court of Bernalillo County, Valerie A. Huling, District Judge: Found both parties breached the contract and were liable for damages. Unified was awarded $92,318.63 for completed but unpaid work, and AHA was awarded $125,600 for damages due to Unified's breach. Unified's motion for reconsideration was refused by the district court (paras 1, 28-31, 34).

Parties' Submissions

• Unified: Argued entitlement to notice of deficient performance and opportunity to cure under the contract and general contract law principles, challenged the district court's decision to allow AHA to raise new grounds for termination of the contract, disputed the method of calculating damages, and claimed entitlement to statutory interest under the Prompt Payment Act (paras 3-4, 37, 50, 55, 68).
• AHA: Contended that notice and opportunity to cure were not required for contract termination under the circumstances, defended the inclusion of new grounds for termination at trial, supported the district court's method of calculating damages, and argued against Unified's entitlement to statutory interest under the Prompt Payment Act (paras 35, 51, 56, 70).

Legal Issues

• Whether Unified was entitled to notice of deficient performance and an opportunity to cure under the contract and general contract law principles.
• Whether the district court erred in allowing AHA to raise new grounds for termination of the contract not articulated prior to trial.
• Whether the district court's method of calculating damages was correct.
• Whether Unified was entitled to statutory interest under the Prompt Payment Act (paras 4, 50, 55, 68).

Disposition

• The Court of Appeals affirmed in part, reversed in part, and remanded to the district court for entry of a final judgment consistent with the opinion. Specifically, the court reversed the district court’s judgment in favor of AHA in the amount of $33,281.37 and remanded for entry of a final judgment in favor of AHA in the reduced amount of $22,257.34. The court affirmed the district court's decision on other contested issues (para 5).

Reasons

• The Court of Appeals found that Unified was not entitled to notice and opportunity to cure before contract termination, as neither the contract nor Form HUD-5370 required such notice for performance-related issues. The court also held that AHA was within its rights to raise new grounds for termination at trial, as the grounds were related to the core issue of Unified's performance. Regarding damages, the court applied the "contract price limitation rule" to correct the district court's calculation, ensuring AHA was not placed in a better position than if the contract had been fully performed. Finally, the court found that AHA's correspondence constituted sufficient notice of a billing dispute to limit liability for statutory interest under the Prompt Payment Act (paras 36-77).