Eastern Elec. v . FERD Const., et a l . CV-05-303-JD 12/15/05 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
Eastern Electrical Corp.
v. Civil N o . 05-cv-303-JD Opinion N o . 2005 DNH 164 FERD Construction, Inc., and BAE Systems, Inc.
O R D E R
Eastern Electrical Corporation provided electrical work as a
subcontractor during the renovation of a building owned by BAE
Systems, Inc., where FERD Construction, Inc., was the general
contractor. When Eastern did not receive the amount it expected
in payment for its work, it brought suit, alleging a claim of
breach of contract against FERD and claims of unjust enrichment
and quantum meruit against FERD and BAE. BAE moves to dismiss
the unjust enrichment and quantum meruit claims against i t .
Standard of Review
In considering a motion to dismiss, pursuant to Federal Rule
of Civil Procedure 12(b)(6), the court accepts the facts alleged
in the complaint as true and draws all reasonable inferences in
favor of the plaintiff. Citibank v . Grupo Cupey, Inc., 382 F.3d
2 9 , 31 (1st Cir. 2004). The court must determine whether the
complaint, construed in the proper light, “alleges facts sufficient to make out a cognizable claim.” Carroll v . Xerox
Corp., 294 F.3d 2 3 1 , 241 (1st Cir. 2002). All that is required
is a short and plain statement of the claim. See Gorski v . N.H.
Dep’t of Corr., 290 F.3d 466, 473 (1st Cir. 2002) (citing
Swierkiewicz v . Sorema N.A., 534 U.S. 506 (2002)).
The court “must carefully balance the rule of simplified civil pleadings against our need for more than conclusory
allegations.” Aybar v . Crispin-Reyes, 118 F.3d 1 0 , 13 (1st Cir.
1997). To avoid dismissal, “the complaint should at least set
forth minimal facts as to who did what to whom, when, and why
. . . .” Redondo-Borges v . U.S. Dep’t of Housing & Urban Dev.,
421 F.3d 1 , 9 (1st Cir. 2005) (internal quotation marks omitted).
“Even within the generous confines of notice pleading, courts
must continue to eschew reliance on bald assertions and
unsupportable conclusions.” Id.
Background
Eastern alleges that BAE engaged FERD to act as general
contractor for the renovation of its building on Canal Street in
Nashua, New Hampshire. After the first electrical contractor was
unable to complete the project, FERD contracted with Eastern, on
a time and materials basis, to complete the electrical work. The
subcontract was executed by Eastern on September 7 , 2004, and by
2 FERD on September 2 0 , 2004.
Eastern alleges that the contract provided a limit on the
amount to be paid for its electrical work as follows: “The value
of this subcontract shall not exceed $125,000 without prior
written authorization.” Complaint ¶ 1 3 . According to Eastern, a
handwritten note was added on September 7 , 2004, indicating that
the initial scope of the electrical work was “to complete up to
$125,000 remaining electrical work.” Id. ¶ 1 5 . Eastern alleges
that it submitted two change orders that FERD approved which
increased the limit on Eastern’s work to $275,000. Eastern
contends that the changes were made because of “field directives”
issued by FERD and BAE and that FERD and BAE continued to issue
field directives for the remainder of the project. Eastern also
alleges that it submitted daily inventories and labor time sheets
to FERD that were approved and that its representatives attended
regular project meetings with representatives of FERD and BAE. By the time it completed the electrical work in late
November of 2004, Eastern alleges it had furnished time and
materials totaling $448,081.77. FERD has paid Eastern
$149,301.98 and provided a retainer of $16,589.11. Eastern has
demanded additional payment from FERD, but FERD has refused to
make any additional payments.
3 Discussion
Eastern brings a claim of breach of contract against FERD
and alleges separate claims of unjust enrichment and quantum
meruit against BAE and FERD. BAE moves to dismiss both claims
against it on the grounds that such claims are not available as a
matter of law, that Eastern failed to state claims of unjust enrichment and quantum meruit, and that a quantum meruit claim
must be based on an underlying contractual relationship. Eastern
objects.
A. Availability of Equitable Remedy
Restitution under theories of quantum meruit and unjust
enrichment is an equitable remedy. See In re Haller, 150 N.H.
427, 430 (2003); Kowalski v . Cedars of Portsmouth Condo. Ass’n,
146 N.H. 1 3 0 , 134 (2001). Equitable remedies are not available
in New Hampshire courts when the plaintiff has an adequate legal
remedy. See, e.g., Concord Orthopaedics Prof. Ass’n v . Forbes,
142 N.H. 440 445-46 (1997); Fischer v . City of Dover, 131 N.H.
469, 476 (1989). Indeed, it is a basic tenet of equity
jurisprudence “that courts of equity should not act . . . when
the moving party has an adequate remedy at law and will not
suffer irreparable injury if denied equitable relief.” Younger
v . Harris, 401 U.S. 3 7 , 43-44 (1971); accord Morales v . Trans
4 World Airlines, Inc., 504 U.S. 3 7 4 , 381 (1992); Parsons
Infrastructure & Tech. Group, Inc. v . Gilbane Bldg. Co., 2005 WL
2978901, at *1 (D.N.H. Nov. 7 , 2005); Massachusetts v . Mylan
Labs., 357 F. Supp. 2d 3 1 4 , 324 (D. Mass. 2005).
Under New Hampshire law, subcontractors have a statutory
right to a lien on the materials provided and the structure where the work was done, provided that the subcontractor gives notice
in writing to the owner of the property before performing the
work o r , for a more limited lien, after the work has begun. See
RSA 447:5; RSA 447:6. Russell v . Woodbury, 135 N.H. 4 3 2 , 433
(1992). In addition, in this case, Eastern had a contract with
FERD that covered its work on BAE’s building. Eastern has
brought a breach of contract claim as part of this suit to
recover the amounts it claims are owed.
Eastern explains that recovery under the mechanics’ lien statute is not available because it did not give the required
notice. Eastern argues that it will suffer irreparable injury if
it is not permitted to maintain its equitable claims against BAE
because it would lose $300,000. Eastern’s argument, however,
does not explain why the remedy it seeks against FERD for breach
of contract, seeking damages for the amounts that it alleges have
not been paid, is not adequate. No irreparable injury exists if
the injury is compensable in damages. See Exeter Realty Corp. v .
5 Buck, 104 N.H. 199, 201 (1962); see also Matrix Group Ltd., Inc.
v . Rawlings Sporting Goods Co., Inc., 378 F.3d 2 9 , 33-34 (1st
Cir. 2004).
Because Eastern has not explained why it does not have an
adequate remedy at law in the circumstances of this case, it is
not entitled to the equitable remedy of restitution under either of its theories. See Parsons, 2005 WL 2978901. Even if that
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Eastern Elec. v . FERD Const., et a l . CV-05-303-JD 12/15/05 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
Eastern Electrical Corp.
v. Civil N o . 05-cv-303-JD Opinion N o . 2005 DNH 164 FERD Construction, Inc., and BAE Systems, Inc.
O R D E R
Eastern Electrical Corporation provided electrical work as a
subcontractor during the renovation of a building owned by BAE
Systems, Inc., where FERD Construction, Inc., was the general
contractor. When Eastern did not receive the amount it expected
in payment for its work, it brought suit, alleging a claim of
breach of contract against FERD and claims of unjust enrichment
and quantum meruit against FERD and BAE. BAE moves to dismiss
the unjust enrichment and quantum meruit claims against i t .
Standard of Review
In considering a motion to dismiss, pursuant to Federal Rule
of Civil Procedure 12(b)(6), the court accepts the facts alleged
in the complaint as true and draws all reasonable inferences in
favor of the plaintiff. Citibank v . Grupo Cupey, Inc., 382 F.3d
2 9 , 31 (1st Cir. 2004). The court must determine whether the
complaint, construed in the proper light, “alleges facts sufficient to make out a cognizable claim.” Carroll v . Xerox
Corp., 294 F.3d 2 3 1 , 241 (1st Cir. 2002). All that is required
is a short and plain statement of the claim. See Gorski v . N.H.
Dep’t of Corr., 290 F.3d 466, 473 (1st Cir. 2002) (citing
Swierkiewicz v . Sorema N.A., 534 U.S. 506 (2002)).
The court “must carefully balance the rule of simplified civil pleadings against our need for more than conclusory
allegations.” Aybar v . Crispin-Reyes, 118 F.3d 1 0 , 13 (1st Cir.
1997). To avoid dismissal, “the complaint should at least set
forth minimal facts as to who did what to whom, when, and why
. . . .” Redondo-Borges v . U.S. Dep’t of Housing & Urban Dev.,
421 F.3d 1 , 9 (1st Cir. 2005) (internal quotation marks omitted).
“Even within the generous confines of notice pleading, courts
must continue to eschew reliance on bald assertions and
unsupportable conclusions.” Id.
Background
Eastern alleges that BAE engaged FERD to act as general
contractor for the renovation of its building on Canal Street in
Nashua, New Hampshire. After the first electrical contractor was
unable to complete the project, FERD contracted with Eastern, on
a time and materials basis, to complete the electrical work. The
subcontract was executed by Eastern on September 7 , 2004, and by
2 FERD on September 2 0 , 2004.
Eastern alleges that the contract provided a limit on the
amount to be paid for its electrical work as follows: “The value
of this subcontract shall not exceed $125,000 without prior
written authorization.” Complaint ¶ 1 3 . According to Eastern, a
handwritten note was added on September 7 , 2004, indicating that
the initial scope of the electrical work was “to complete up to
$125,000 remaining electrical work.” Id. ¶ 1 5 . Eastern alleges
that it submitted two change orders that FERD approved which
increased the limit on Eastern’s work to $275,000. Eastern
contends that the changes were made because of “field directives”
issued by FERD and BAE and that FERD and BAE continued to issue
field directives for the remainder of the project. Eastern also
alleges that it submitted daily inventories and labor time sheets
to FERD that were approved and that its representatives attended
regular project meetings with representatives of FERD and BAE. By the time it completed the electrical work in late
November of 2004, Eastern alleges it had furnished time and
materials totaling $448,081.77. FERD has paid Eastern
$149,301.98 and provided a retainer of $16,589.11. Eastern has
demanded additional payment from FERD, but FERD has refused to
make any additional payments.
3 Discussion
Eastern brings a claim of breach of contract against FERD
and alleges separate claims of unjust enrichment and quantum
meruit against BAE and FERD. BAE moves to dismiss both claims
against it on the grounds that such claims are not available as a
matter of law, that Eastern failed to state claims of unjust enrichment and quantum meruit, and that a quantum meruit claim
must be based on an underlying contractual relationship. Eastern
objects.
A. Availability of Equitable Remedy
Restitution under theories of quantum meruit and unjust
enrichment is an equitable remedy. See In re Haller, 150 N.H.
427, 430 (2003); Kowalski v . Cedars of Portsmouth Condo. Ass’n,
146 N.H. 1 3 0 , 134 (2001). Equitable remedies are not available
in New Hampshire courts when the plaintiff has an adequate legal
remedy. See, e.g., Concord Orthopaedics Prof. Ass’n v . Forbes,
142 N.H. 440 445-46 (1997); Fischer v . City of Dover, 131 N.H.
469, 476 (1989). Indeed, it is a basic tenet of equity
jurisprudence “that courts of equity should not act . . . when
the moving party has an adequate remedy at law and will not
suffer irreparable injury if denied equitable relief.” Younger
v . Harris, 401 U.S. 3 7 , 43-44 (1971); accord Morales v . Trans
4 World Airlines, Inc., 504 U.S. 3 7 4 , 381 (1992); Parsons
Infrastructure & Tech. Group, Inc. v . Gilbane Bldg. Co., 2005 WL
2978901, at *1 (D.N.H. Nov. 7 , 2005); Massachusetts v . Mylan
Labs., 357 F. Supp. 2d 3 1 4 , 324 (D. Mass. 2005).
Under New Hampshire law, subcontractors have a statutory
right to a lien on the materials provided and the structure where the work was done, provided that the subcontractor gives notice
in writing to the owner of the property before performing the
work o r , for a more limited lien, after the work has begun. See
RSA 447:5; RSA 447:6. Russell v . Woodbury, 135 N.H. 4 3 2 , 433
(1992). In addition, in this case, Eastern had a contract with
FERD that covered its work on BAE’s building. Eastern has
brought a breach of contract claim as part of this suit to
recover the amounts it claims are owed.
Eastern explains that recovery under the mechanics’ lien statute is not available because it did not give the required
notice. Eastern argues that it will suffer irreparable injury if
it is not permitted to maintain its equitable claims against BAE
because it would lose $300,000. Eastern’s argument, however,
does not explain why the remedy it seeks against FERD for breach
of contract, seeking damages for the amounts that it alleges have
not been paid, is not adequate. No irreparable injury exists if
the injury is compensable in damages. See Exeter Realty Corp. v .
5 Buck, 104 N.H. 199, 201 (1962); see also Matrix Group Ltd., Inc.
v . Rawlings Sporting Goods Co., Inc., 378 F.3d 2 9 , 33-34 (1st
Cir. 2004).
Because Eastern has not explained why it does not have an
adequate remedy at law in the circumstances of this case, it is
not entitled to the equitable remedy of restitution under either of its theories. See Parsons, 2005 WL 2978901. Even if that
explanation were forthcoming, however, the complaint is
insufficient to state those claims.
B. Unjust Enrichment and Quantum Meruit
“The doctrine of unjust enrichment is that one shall not be
allowed to profit or enrich himself at the expense of another
contrary to equity.” Pella Windows & Doors, Inc. v . Faraci, 133
N.H. 585, 586 (1990) (internal quotation marks omitted). A claim
of quantum meruit asserts the plaintiff’s right “only to obtain
what equitably belongs to him.” Blanchard v . Calderwood, 110
N.H. 2 9 , 34 (1969) (internal quotation marks omitted). The
elements of a restitution claim under unjust enrichment or
quantum meruit are that the defendant was unjustly enriched
“either through wrongful acts or passive acceptance of a benefit
6 that would be unconscionable to permit the defendant to retain.”1
R. Zoppo Co., Inc. v . City of Manchester, 122 N.H. 1109, 1113
(1982).
Theories of unjust enrichment and quantum meruit are based
on the equitable principle that the defendant has enriched itself
at the expense of another, or in other words, has received a
benefit for which it has not paid. See, e.g., Pella Windows, 133
N.H. at 586. Eastern did not allege that BAE failed to pay FERD
for the work Eastern did on BAE’s building. Instead, Eastern
alleges in a cursory manner that because it has not been paid in
full, FERD and BAE have been unjustly enriched and received a
1 New Hampshire cases do not clearly differentiate between theories of unjust enrichment and quantum meruit. See, e.g., Nat’l Employment serv. Corp. v . Olsten Staffing Serv., Inc., 145 N.H. 1 5 8 , 163 (2000) (reversing judgment on plaintiff’s “quantum meruit” claim stating: “A plaintiff is entitled to restitution for unjust enrichment if the defendant received a benefit and it would be unconscionable for the defendant to retain that benefit.”); Petrie-Clemons v . Butterfield, 122 N.H. 1 2 0 , 127 (1982) (reviewing case where “plaintiffs recovered in quantum meruit for unjust enrichment); R. Zoppo Co., 122 N.H. at 1112-14 (describing plaintiff’s claim as restitution, quantum meruit, and unjust enrichment). In Cohen v . Frank Developers, Inc., 118 N.H. 512, 517-18 (1978), however, the court noted that it had previously “held that quantum meruit is a restitutionary remedy intended for use by contracting parties who are in material breach of a contract and thus unable to sue on it.” See R.J. Berke & C o . v . J.P. Griffin, Inc., 116 N.H. 760 764 (1976). Despite that ruling, as the above cited cases demonstrate, the court has cited the doctrine of quantum meruit in cases that did not involve contracting parties in material breach.
7 benefit from Eastern’s work. BAE asserts that it has paid FERD
in full for the work. In the absence of factual allegations that
BAE did not pay for the work that was done, Eastern failed to
state a claim under either unjust enrichment or quantum meruit.
Conclusion
For the foregoing reasons, defendant BAE Systems, Inc.’s
motion to dismiss (document no. 14) is granted. Both claims
brought against BAE Systems, Inc., are dismissed.
SO ORDERED.
Joseph A. DiClerico, Jr. V United States District Judge
December 15, 2005
cc: Lucy J. Karl, Esquire Robert V. McKenney, Esquire Arpiar G. Saunders Jr., Esquire Jonathan M. Shirley, Esquire