Background
Apex Advanced Technology, LLC and TDS Metrocom, LLC entered into a Professional Services Agreement (PSA) in February 2022 under which Apex performed engineering and contracting work on seven projects across multiple states. The PSA incorporated Statements of Work (SOWs) for each project, specifying deliverables at milestone dates. Under the contract’s inspection provision, TDS had 60 days after delivery to identify defects; failure to notify meant acceptance. Apex was required to invoice according to Exhibit D of the PSA, which mandated payment of undisputed invoices within 45 days of receipt. If TDS disputed an invoice, it had to provide written notice within 45 days; disputed amounts could be withheld, and the parties were to negotiate in good faith within 30 days.
Apex completed work on all seven projects and submitted invoices between October 2023 and January 2024, totaling $1,450,138.33. TDS never paid and claimed Apex had not performed the work professionally or completely. Apex sued for breach of contract, arguing TDS waived its right to dispute invoices by failing to object within 45 days and by accepting the work without written notice of nonconformity.
The Court’s Holding
The Illinois Appellate Court reversed the trial court’s grant of summary judgment, holding that genuine issues of material fact exist regarding whether Apex substantially performed its contractual obligations. The court emphasized that even when a contracting party fails to object within the contractual dispute period, that waiver does not relieve the contractor of its burden to prove actual performance as an essential element of a breach-of-contract claim. To recover, a plaintiff must establish four elements: (1) a valid, enforceable contract; (2) performance by the plaintiff; (3) breach by the defendant; and (4) resulting injury. The trial court erred by granting summary judgment without resolving the disputed factual question of whether Apex performed.
The court found that Soczka’s affidavit—Apex’s Director of Engineering—supplemented by supporting emails and project documentation, created triable issues of fact regarding performance. While some of Soczka’s statements were conclusory, his affidavit was grounded in personal knowledge and investigation, satisfying Rule 191(a). Soczka detailed specific deficiencies in Apex’s work for each project, including work not completed, invoices submitted before TDS approved scope, and defects requiring internal correction. These factual disputes preclude summary judgment.
Key Takeaways
- A contractor’s failure to object to invoices within a contractual dispute period may constitute a waiver of that objection, but does not waive the contractor’s right to challenge whether the contractor performed its core obligations.
- Summary judgment on a breach-of-contract claim requires establishing all essential elements, including the plaintiff’s performance; a defendant’s affidavit and supporting documentary evidence may create genuine factual disputes on this element.
- Affidavits grounded in personal knowledge and investigation, supplemented by documentary evidence, can satisfy summary judgment evidentiary standards and defeat summary judgment even if some statements are conclusory.
Why It Matters
This decision reinforces that contract disputes turning on whether services were actually performed cannot be resolved on summary judgment when a party presents evidence of non-performance grounded in personal knowledge and supporting documents. For service contracts with inspection and payment-dispute provisions, the failure to timely object does not eliminate the factual dispute about whether performance occurred. The ruling also clarifies that affidavits need not be purely factual when based on the affiant’s investigation and personal knowledge, rejecting an overly strict reading of Illinois procedural rules.
Practitioners representing service providers should note that contractual waiver provisions and acceptance clauses, while valuable, do not substitute for proving actual performance. Conversely, defendants disputing work quality must timely object and provide specific written notice. The case underscores that major service-contract disputes involving multiple projects, scope disagreements, and alleged defects typically involve material factual disputes unsuitable for summary judgment.