CASE #$1$

Abbott Corp. and Hobbs Construction Co$.$ entered into an oral contract whereby Hobbs was

to build certain roads in Jackson Village. The roads were to be built to grade stakes that

were set by Abbott engineer. Abbott continually inspected the work from day to day and at

all times had control of the elevation to which the finished roads were to be built. The

stakes were set at $5-$ft elevation intervals. Both parties knew the character of the subsoil,

both at the time of entering into the work and at the time the work was being done; each

was fully aware of the possibility that roads built on such soil might settle. The roads were

inspected during the progress of the work by a Jackson County inspector who was

principally concerned with the depth of rock and with the surfacing. The roads were

completed according to the Jackson County specifications and at the elevation set and

required by Abbott. During the course of the work, Hobbs was fearful that the roads might

settle and wanted to build them higher than the elevation set by Abbott. Hobbs advised

Abbott that the roads might settle, but Abbott would not permit Hobbs to build the roads

higher because a higher road would have required additional fill on each of the lots. Soon

after the work was complete, there was a slight settlement of some portions of the roads so

that the roads were below the $5-$ft elevation as required by Abbott. Abbott insisted that

Hobbs raise the elevation of the roads at Hobbs expense. Hobbs refused. Simultaneous with

the Jackson Village project, Hobbs had another contract with Abbott to perform identical

work on the Long Mile Estates, First Addition project. Abbott insisted that Hobbs raise the

elevation of the roads on this project at Hobbs expense, just as Abbott had insisted on the

Jackson Village project. Hobbs again refused. When Abbott said it would not accept the

work $($and would not pay$)$ unless Hobbs altered its performance in accordance with this

new directive, Hobbs stopped work on the project.

Questions:

If you had decision making power over this case, how would you rule?

Are Hobb$$s actions a form of economic duress?