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  • Writer's pictureGeorge Marco

APPEARING AT A KICKOFF MEETING MAY BE SUFFICIENT TO BIND A CONTRACTOR TO AN UNSIGNED CONTRACT

In April 2024, a trial court in New York refused to dismiss a contractor’s complaint against its subcontractor for breach of contract even though a contract was never signed.  WDF, Inc. v. Mar-Sal Plumbing & Heating Inc., 2024 NY Slip Op 31438 (Sup. Ct. N.Y. Cnty.).


In WDF, a plumbing subcontractor submitted a price to a general contractor in connection with a project for the Dormitory Authority.  After WDF sent a letter of intent to the subcontractor and was awarded the project, the subcontractor attended a kickoff meeting with the Dormitory Authority but then refused to perform the work claiming it had made a mistake in its bid calculation.  WDF therefore hired another subcontractor to perform the work and sued the subcontractor for breach of contract.

 

In refusing to dismiss WDF’s complaint the court stated that even though a contract was never signed, the subcontractor’s attendance at the kickoff meeting, in addition to its participation in the Authority’s vetting process, may be sufficient to bind it to its bid proposal.  The court also noted that the letter of intent did not contain any reservation of rights language regarding formation of a contract.

 

Comment:

 

As noted by the court, under New York law, a party’s conduct that it is “unequivocally referable” to an unsigned agreement may be sufficient to bind it to the agreement.  Thus, simply because a contract is not signed does not necessarily mean that the parties did not form a binding agreement.  Instead, courts will look to the parties’ conduct to determine whether there was an intent to be bound to each other, such as partial performance and/or partial payment for the work at issue.

 

The bottom line is that parties should be wary of performing acts, such as attending kickoff meetings or participating in an owner’s vetting process, where they have no intent to be bound to an agreement since their actions will carry much more weight than their signature.

 

About the author: George Marco is an attorney practicing in the field of construction law. He also holds a Bachelor of Science in Mechanical Engineering and was previously employed as a Project Manager for a public improvement contractor.


If you would like more information regarding this topic or any other related to construction law please contact George Marco at george@gmarcolaw.com or call (516) 464-2320.


Disclaimer: This article is for informational purposes only and not intended to serve as legal counsel.



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