Francis O. Day Co. v. Montgomery County

650 A.2d 303, 102 Md. App. 514, 1994 Md. App. LEXIS 169
CourtCourt of Special Appeals of Maryland
DecidedDecember 5, 1994
DocketNo. 463
StatusPublished
Cited by9 cases

This text of 650 A.2d 303 (Francis O. Day Co. v. Montgomery County) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Francis O. Day Co. v. Montgomery County, 650 A.2d 303, 102 Md. App. 514, 1994 Md. App. LEXIS 169 (Md. Ct. App. 1994).

Opinion

CATHELL, Judge.

Appellant, Francis O. Day Co., Inc. (Day), appeals from the granting of summary judgment in favor of appellee, Montgomery County, Maryland, in respect to a claim for unjust enrichment filed by Day against Montgomery County.1 The factual predicate, in spite of appellant’s assertion, is not in dispute. In other words, the result would be the same under any interpretation of the facts. Thus, the issue was appropriately addressed below in a summary judgment context. Day, nevertheless, presents a unique basis for claiming relief under unjust enrichment principles.

[516]*516Facts

Aldre, Inc. (Aldre), was a general partner for several limited partnerships involved in developing several properties. Aldre entered into an agreement or agreements with Montgomery County in respect to the developments in which it was required to construct infrastructure, including roads, according to appellee’s standards, in order to service the needs of the potential inhabitants of the development. The agreements required Aldre at a certain point in time to dedicate such improvements to appellee, after which the appellee would be required to include those improvements in its infrastructure network and be responsible for their maintenance and upkeep.

Aldre was required by appellee to post performance bonds but no payment bond. The arrangements between Aldre and appellee were pursuant to the County’s various subdivision and developmental statutes.

Thereafter, Aldre entered into a contract with appellant for the latter to construct substantial portions of the infrastructure for the various developments. Aldre suffered financial difficulties and defaulted on payment to appellant. Unable to collect from Aldre or to enforce liens against Aldre’s property, appellant instituted suit against the County. Appellant appears to have posited its theory of recovery initially on a concept that, because the infrastructure was to be dedicated to appellee after it was completed, the agreement between Aldre and appellant was for the construction of a public improvement and, thus, was subject to the Little Miller Act2. Appellant then argued that appellee was derelict or negligent in not requiring a payment bond as required under that act.

Although appellant discusses the Little Miller Act extensively in its brief, it has not appealed the trial court’s decision on the counts that alleged the provisions of the Act had been violated. We, accordingly, shall not address the Act further.

The issue for us to decide is rephrased as:

[517]*517When a governing body, pursuant to its statutes, requires a developer to enter into agreements to construct the infrastructure necessitated by the potential demands of the developments’ inhabitants and later dedicate the improvements to the governing entity, is that governing entity unjustly enriched if the developer fails to pay fully the subcontractor for the work performed in constructing the improvements?

The answer is “No,” and we shall affirm.

The Law

We shall discuss generally the Maryland law on unjust enrichment, noting initially that neither party has directed us to any Maryland cases involving unjust enrichment claims under factual situations remotely similar to those extant in the case sub judice. We likewise have failed to find any Maryland cases on point.

While we shall resolve the issue presented in our discussion of the granting of the summary judgment, we cannot help noting that, even if appellant had made it past the summary judgment motion, the problems it would then have faced on an unjust enrichment claim would appear to be insurmountable. In this context, we first address the absence of a written contract between appellant and appellee and the relationship between that fact and the County’s governmental immunity.

As in the case at bar, there was no written contract between appellant and appellee in Leese v. Baltimore County, 64 Md.App. 442, 477-79, 497 A.2d 159, cert. denied, 305 Md. 106, 501 A.2d 845 (1985), where we opined:

Where a county is attempting to assert governmental immunity as a bar to a contract claim, the common law allows it to “abrogate its responsibility under a contract entered into in performance of a governmental function if dictated by the public good.” American Structures, Inc. v. Baltimore, 278 Md. 356, 359, 364 A.2d 55 (1976). This is not to suggest that counties and municipalities are fully immun[518]*518ized against contractual liability. Rather, they are “answerable in damages incurred to the time of cancellation.” Id.
This common law contract immunity, however, is limited by statute. Under § 1A, Article 25A, Annotated Code of Maryland, “a chartered county ... may not raise the defense of sovereign immunity ... in an action in contract based upon a written contract executed on behalf of the county or its department, agency, board, commission or unit by an official or employee acting within the scope of his authority.” Md.Code Ann. Art. 25A, § lA(a) (1984 Supp.). See also Md. State Gov’t Art. § 12-202 (1984); Md.Code Ann. Art. 25, § 1A (1984 Supp.).
... His attempted reliance upon Section 1A to avoid sovereign immunity is misplaced. By its terms, Section 1A requires a “written contract” that was “executed on behalf of the county.” A failure to meet either of these requirements nullifies the operation of the section. [Emphasis added.]

We discussed similar statutory language applicable to the State’s waiver of immunity in contract cases where unjust enrichment was at issue in Mass Transit Admin, v. Granite Constr. Co., 57 Md.App. 766, 770, 471 A.2d 1121 (1984), noting:

Our review of the facts persuades us that MTA was not unjustly enriched; and an analysis of the parties’ arguments pertaining to the doctrine of sovereign immunity and the principle of unjust enrichment leads us to conclude that, in this case at least, the two concepts are sufficiently incompatible to bar recovery by Granite. In order to steer a course safely past Scylla (the State’s waiver of sovereign immunity is limited to claims based on written contracts), appellee would have to sail into the maws of Charybdis (the principle that unjust enrichment does not apply if there is a written contract).

We explained:

“The doctrine of sovereign immunity from suit, rooted in the ancient common law, is firmly embedded in the laws of

[519]*519Maryland.” Katz v. Wash. Suburban Sanitary Comm’n, 284 Md. 503, 507, 397 A.2d 1027 (1979); Austin v. City of Baltimore, 286 Md. 51, 53, 405 A.2d 255 (1979).

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Bluebook (online)
650 A.2d 303, 102 Md. App. 514, 1994 Md. App. LEXIS 169, Counsel Stack Legal Research, https://law.counselstack.com/opinion/francis-o-day-co-v-montgomery-county-mdctspecapp-1994.