Wood Bros. Homes, Inc. v. Walker Adjustment Bureau

Gagnon, a California resident, contracted in Colorado with Wood Bros. (defendant), a Colorado-based company, to perform carpentry work in New Mexico, but was shut down there for lacking the New Mexico contractor's license required by that state's licensing act, which barred unlicensed contractors from recovering payment for their work. Wood Bros. cancelled the contract and refused payment; Walker (plaintiff), Gagnon's assignee, sued in Colorado for breach of contract or quantum meruit. The court of appeals held Colorado law applied, reasoning Colorado's interest in validating agreements gave it the most significant relationship to the contract, and that Wood Bros. was estopped from raising the licensing issue since it knew of Gagnon's lack of license but let him work anyway.

Whether, under the Second Restatement, a state's general interest in the validation of agreements rebuts a presumption that another state's law applies where such latter state expressly and specifically bars enforcement of the contract at issue.