Case Problem:
Smith hired Jones Construction to build a detached garage on her property according to certain specifications for $15,000. The contract called for Smith to pay Jones $5,000 “up front,” to disburse an additional $7,000 at various stages of the construction, and to make a final payment of $3,000 at the completion of construction. Jones built the garage, but Smith complained that Jones’s workmanship was substandard and that Jones had failed to build the garage to the specifications provided in the contract. Smith refused to make the final $3,000 payment. After Jones threatened to sue Smith for the $3,000, the parties came to an agreement that Smith would pay Jones $1,500 and Jones would accept the $1,500 as full payment of the contract. Smith paid Jones $1,500, making clear that it was for full payment of the contract, and Jones accepted the payment. However, Jones continued to try to collect the additional $1,500 provided for in the original contract, and when Smith refused to pay it, ultimately filed suit against Smith in small claims court. Is Smith legally obligated to pay the additional $1,500?
Your answer must be typed, double-spaced, Times New Roman font (size 12), one-inch margins on all sides, APA format and also include references.