An Indiana couple who paid $100,000 towards a $211,235 modular home but withheld the remaining amount over alleged construction problems have lost their appeal. The Indiana Court of Appeals on November 9 upheld a judgment requiring Tim and Judy McAfee to pay Goeglein Homes, LLC, a total of $221,704.According to the judgment document, the dispute began after the couple hired the company to install a modular home on their property. They raised concerns about the foundation, sloping floors and water entering the crawl space. They argued that the builder had not completed the work as agreed and should not demand the remaining payment.However, the builder maintained that it had substantially fulfilled its contractual responsibilities. It filed a breach-of-contract case after the couple refused to pay the outstanding amount.
Couple withheld payment after home inspection
Tim and Judy McAfee signed an agreement with Goeglein Homes in December 2021. The original price was $210,650, which increased to $211,235 after they selected a different stove.The company was responsible for preparing the foundation, obtaining permits and completing plumbing work. The couple had to arrange other tasks, including landscaping, electrical service, the driveway, well and septic system.The builder purchased the modular home from Cavco Manufacturing, LLC, and arranged its installation in October 2022. The couple paid $100,000 in December that year, leaving $110,235 outstanding.A home inspection in March 2023 identified concerns including sloping floors, cracked concrete supports, attic framing problems and water entering the crawl space.The disagreement escalated after the builder’s project manager visited the property. Judy told him to leave, while Tim later acknowledged that he would not allow the company’s employees to return.Goeglein Homes sued the couple in May 2023, claiming they had breached the agreement by withholding payment. The couple filed a counterclaim alleging unresolved construction defects.
Court accepts engineer’s assessment
The parties attempted mediation in May 2024 and agreed to complete certain pending work. However, disagreements over the drain tile inspection prevented the settlement from proceeding.During the trial in February 2026, structural engineer Jeremy Bowers examined the property. He concluded that the house met accepted residential construction standards for a modular home.He attributed the foundation cracks to temperature-related shrinkage and said the water accumulation was linked to a downspout issue that fell under the couple’s responsibility.The court also considered testimony from Andre Mourad, who was disqualified from giving expert evidence. When asked about the scientific principles behind his findings, Mourad replied, “Quite simply, there are none.”The trial court found the builder had substantially performed its contractual obligations by March 20, 2023. It ruled that the couple had breached the agreement by refusing to pay.
Appeals court upholds $221,704 judgment
In April 2026, the trial court ordered the couple to pay $110,235 in outstanding contract payments, along with attorney and expert witness fees. After deducting $8,800 for unfinished work, the judgment stood at $197,889. A subsequent order increased the total to $221,704.The couple challenged the ruling, arguing that the builder had demanded payment before completing its responsibilities and had stopped work on its own.The appeals court rejected their arguments. It noted that the couple had not specifically challenged the finding that the builder had substantially performed its obligations.It also observed that the couple’s refusal to allow the company’s employees back had prevented the remaining work from being completed. The contract did not require the builder to issue a formal completion notice or written demand for payment.The Indiana Court of Appeals therefore found no reason to overturn the trial court’s decision and affirmed the judgment in favour of Goeglein Homes on November 9.
