Plante v. Jacobs
Citation and Court
Plante v. Jacobs, 10 Wis. 2d 567 (Wis. 1960)
Facts
Plante contracted to build a house for the Jacobses according to their specifications. Upon substantial completion, minor defects remained, including a misplaced wall that made a room about a foot narrower than specified. The Jacobses refused to make the final payment. Plante sued for the contract price, and the Jacobses counterclaimed for the cost of correcting all deficiencies.
Issue
Whether a contractor who substantially performed a house-building contract is entitled to the contract price, and how damages for minor deviations should be measured.
Holding
The Wisconsin Supreme Court held that Plante had substantially performed and was entitled to the contract price, less the diminished value caused by the defects—not the cost to repair them, which would have required tearing out a wall.
Rule / Doctrine
A contractor who substantially performs is entitled to the contract price, subject to deduction for deficiencies. Damages for defects in a construction contract are measured by the diminished value of the structure (not the cost to cure) when the cost to cure would be grossly disproportionate to the benefit gained—i.e., economic waste.
Significance
A leading case on both the substantial performance doctrine and the damages measure for construction defects. Establishes the economic waste exception to the cost-to-cure measure of damages: where repair would be economically wasteful (e.g., tearing out a misplaced wall), courts measure damages by the diminished market value instead. Pairs with OW Grun Roofing & Construction Co. v. Cope on the limits of substantial performance.