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Good morning. Did the owner advise why they would not allow the contractor to perform the work? Also, the contact is in writing?
Simply is always better. Once the owner prevents and does not allow the contractor the finish the job, there would be a material breach. If the contractor is ready, willing and able to perform under the contract and they are prevented from, through no fault of their own and as a direct result of the owner/other party, there would be a breach. At that time, they would be entitled to be paid for the work performed / benefit conveyed onto the owner AND any lost profits, had they expected to make, once the job was complete. If there was no contract, then quantum meruit would apply. Quantum meruit determines the amount to be paid for services when no contract exists or when there is doubt as to the amount due for the work performed but done under circumstances when payment could be expected. In this case, you shared that there was an contract, so it should have detailed the cost for the work which was agreed to.
Yes, I do understand. However, it depends. If the contractor went and bought all the materials, then they would be entitled to the contract amount, since the total price of the job was for the materials, labor and profit. However, if the materials were provided and/or only a portion were bought, then the contractor could not recover when there were no losses incurred. A court will award damages to a party and those are for lost profit, labor and materials.