Gillette v. Storm Circle Ranch

619 P.2d 1116, 101 Idaho 663, 1980 Ida. LEXIS 534

• Court: Idaho Supreme Court
• Decided: December 18, 1980
• Docket: 12953
• Status: Published

Opinions

BAKES, Justice.

Defendant appellants Storm Circle Ranch and Blincoe Farms, Inc., bring this appeal from a district court judgment holding that they were unjustly enriched by work done by plaintiff respondent Frank Gillette. We have reviewed the proof presented at trial and hold that the evidence and the trial court’s findings and conclusions drawn therefrom do not support the unjust enrichment award entered against the defendants. Accordingly, we reverse.

In 1975 Gillette and Storm Circle executed a written lease agreement by which Gillette, the lessee, was entitled to possession of farmland owned by Storm Circle, the lessor, from April 1, 1975, to January 5, 1976. The parties’ agreement also gave Gillette an exclusive option to purchase the property for $800,000. on terms specified in the option. Gillette’s option was to expire on January 5, 1976. The lease agreement provided that Gillette was to do all work necessary to prepare the ground and to plant and harvest certain crops “with good farmer-like methods.” Gillette’s lease payments were to consist in part of a percentage of the crops harvested from the leased property.

Prior to entering into the lease option with Gillette, an unspecified portion of the leased property had been fall planted in wheat by Storm Circle in 1974, and Gillette irrigated and cut that crop in 1975. In the fall of 1975, after harvesting the 1975 crop, Gillette ripped, disked, irrigated and fertilized the land and planted alfalfa, barley and wheat, all to be harvested in 1976. However, although Gillette had intended to exercise his option to purchase the the property prior to January 5, 1976, the last date provided in the option, he was unable to obtain the necessary financing to do so.

The record suggests that Storm Circle was in serious financial condition. After Gillette’s option expired without having been exercised, Storm Circle sold the property on January 23, 1976, to defendant appellant Blincoe Farms, Inc., for $700,000, and Gillette was directed to vacate the property. On February 5, 1976, Gillette filed a farm labor lien and seed lien and brought this action to recover from Storm Circle and Blincoe Farms, Inc., the value of the fall work he had performed while in possession of the land in 1975. Gillette sought recovery on two distinct theories: (1) foreclosure of farm labor and seed liens; and (2) unjust enrichment. The district court ruled that Gillette’s farm labor and seed liens were not timely filed and were therefore unenforceable, but held that Gillette’s farm work had inured to the benefit of both Storm Circle and Blincoe Farms, Inc. The court concluded that Storm Circle and Blincoe Farms, Inc., had been unjustly enriched by Gillette’s work and were jointly and severally liable to Gillette for $17,-712.09, the amount Gillette asserted the fall work had cost him.¹

The essence of an action based upon unjust enrichment is the claim that the defendant has been enriched by the plaintiff and that it would be inequitable for the defendant to retain that benefit without compensating the plaintiff for the value of the benefit. Hertz v. Fiscus, 98 Idaho 456, 567 P.2d 1 (1977). The measure of damages in a claim of unjust enrichment is the value of the benefit bestowed upon the defendant which, in equity, would be unjust to retain without recompense to the plaintiff. The measure of damages is not necessarily the value of the money, labor and materials provided by the plaintiff to the defendant, but the amount of benefit the defendant received which would be unjust for the defendant to retain. Nielson v. Davis, 96 Idaho 314, 528 P.2d 196 (1974); Continental Forest Products, Inc. v. Chandler Supply Co., 95 Idaho 739, 518 P.2d 1201 (1974). Applying these principles to the facts of this case, we conclude that the judgment against the defendants cannot be sustained.

First, as to the defendant Blincoe Farms, the trial court found that Blincoe Farms was aware that the fall work had been done by Gillette when it negotiated with Storm Circle in January of 1976 to purchase the property. We have carefully reviewed the record and do not find any evidence that Blincoe Farms was aware that the fall work had been done by Gillette when it negotiated with Storm Circle to purchase the property. While there was evidence that Blincoe personnel did help Storm Circle harvest its sugar beets in the fall of 1975, there is no evidence in the record to show that Blincoe was aware of any fall cultivating or planting which Gillette may have done. That finding of the trial court is clearly erroneous and must be set aside. I.R.C.P. 52.

Based upon the finding that Blincoe Farms was aware that the fall work had been done, the trial court concluded that “[t]he sale price between the defendants, Storm Circle Ranch and Blincoe Farms, Inc., was agreed upon and the labor and material furnished by plaintiff were included in that price.” The record, however, contains no indication that the fall work was ever discussed by Blincoe and Storm Circle or that the price agreed upon by Blincoe and Storm Circle included the value of the fall work. The court’s finding that Blincoe Farms was unjustly enriched is without evidentiary support and therefore must be set aside. Nevertheless, assuming that the Blincoe Farms had been aware that Gillette had done the fall planting, the foregoing finding of the trial court would indicate that Gillette’s labor and materials were considered in arriving at the price which Blincoe paid and would negate any finding or conclusion that Blincoe was enriched by Gillette’s labor and materials, whether unjustly or otherwise. If Gillette’s labor and materials were included in the price that Blincoe paid, then as a matter of law there could be no unjust enrichment on Blincoe’s part, since the price it paid for the farm would have included the labor and materials. Because the trial court’s findings are unsupported by the evidence, and even if supported do not support a conclusion that Blincoe Farms was unjustly enriched as a result of Gillette’s fall work, the judgment against Blincoe Farms, Inc., must be reversed.

We also conclude that the judgment against Storm Circle must also be reversed. Although Gillette submitted proof of the cost to him of his fall work, where Storm Circle sold the farm before the crops were harvested, mere proof of his costs was inadequate to establish the value of any benefit which Storm Circle may have received from that fall work. Unjust enrichment is an equitable doctrine and is inapplicable where the plaintiff in an action fails to provide the proof necessary to establish the value of the benefit conferred upon the defendant. See Nielson v. Davis, supra. Although damages need not be proven with mathematical precision, the damages, i. e., the value of any benefit unjustly received by the defendant in an action based upon unjust enrichment, must be proven to a reasonable certainty. Cf. Olson v. Quality-Pak Co., 93 Idaho 607, 469 P.2d 45 (1970); Big Butte Ranch, Inc. v. Grasmick, 91 Idaho 6, 415 P.2d 48 (1966) (damages for breach of contract must be proven to a reasonable certainty).

Gillette’s proof of damages at trial was directed solely to the value of the labor and materials he expended in performing the fall work. But since Storm Circle did not harvest those crops, the only benefit which it could have received by plaintiff’s work was an enhancement of the market value of the property. Although the district court concluded that the price obtained by Storm Circle included the labor and materials furnished by Gillette, the trial transcript contains no evidence that a price allocation was made by Storm Circle and Blincoe Farms, Inc., regarding Gillette’s fall work. Had Storm Circle farmed the property in 1976 and harvested the crops planted by Gillette, Gillette’s proof at trial would have been adequate to support the trial court’s finding of the value of the benefit received by Storm Circle from Gillette’s fall work. However, when Storm Circle sold the property in January of 1976, prior to maturity of the crops planted by Gillette, any benefit received by Storm Circle as a result of Gillette’s fall work could only have been reflected in an increased price received for the property. Gillette failed to present any evidence that the fall work affected either the price which Storm Circle received for the farm or the value of the farm. Because Gillette’s proof at trial reflected only the detriment suffered by him and not the amount of benefit the work gave Storm Circle, the proof was inadequate to support a judgment based upon the theory of unjust enrichment. Nielson v. Davis, supra.

Furthermore, Gillette received the benefit of field preparation and planting done by Storm Circle in the fall of 1974 prior to Gillette’s taking possession of the property in April, 1975. The value of that work would have reduced the value of Gillette’s claim that Storm Circle was unjustly enriched by Gillette’s fall work in 1975. Gillette made no showing of the value of the 1974 work which he benefitted from.

As a result of the proof which Gillette presented at trial, the damage award based upon the value of the benefits bestowed upon Storm Circle by Gillette’s fall work must be purely speculative. For this reason, the district court’s award of damages against Storm Circle must be reversed.

Costs are awarded to appellants. No attorney fees allowed.

DONALDSON, C. J., and McFADDEN, J., concur.

1 . The dissents of Justice Bistline and of Justice pro tempore Hargraves both suggest that Storm Circle breached the option contract when it sold to Blincoe Farms. Thus, Justice Bistline states, “If there had been no contractual relationship at all between Gillette and Storm Circle, then Gillette would not have been in any position to complain about the money and time he had spent. But there was such a relationship; when Storm Circle violated the agreement creating that relationship, Gillette was entitled to recover that which he had expended.” In the same vein, Justice Hargraves writes that Gillette’s “failure to give notice of the exercise of the option prior to December 15, 1977, amounts to an automatic self activation exercise of the option,” concluding that “Storm Circle would be obligated to tender a contract within a reasonable time and only then would the option expire in the event Gillette did not execute the contract of sale.” Justice Hargraves points out that Gillette was still attempting to secure financing when the farm “was sold out from under him.”

Whether those statements are a correct interpretation of the lease and option agreement was not an issue which was tried in this case and thus has not been resolved by either the trial court or by this Court on appeal. However, it is clear that the plaintiff Gillette did not interpret the option provision in the way suggested by the dissenting opinions. When he filed his action against Storm Circle he made no allegation that the option contained in the lease agreement had either been exercised by him or was subject to “automatic self activation.” In fact, Gillette’s complaint did not even mention either the lease or the option, and claimed no rights under either. His complaint alleged only that Storm Circle, through its managers Shults and Bingham “employed Plaintiff to perform certain work and labor in farming the said premises . ” which the plaintiff alleged were owned by defendant Storm Circle. Blincoe Farms, Inc., was named a party defendant because it “claims some interest in said premises.” In Count I, plaintiff alleged the reasonable value of his work to be $13,000.00, which he alleged was secured by the farm labor lien and seed lien; in Count II, plaintiff alleged that plaintiff furnished “304 cwt. of said Certified Wheat Seed at $11.50 per cwt. for a total sum of $3,496.00” which was secured by the same lien. Plaintiff then prayed for a judgment “against defendants jointly and severally . . and that said sums be declared a lien upon said wheat crop of defendants . ..” Subsequently, plaintiff amended his complaint adding Count III, alleging unjust enrichment, still without mentioning the lease or the option.

While the trial court made reference to the lease and option agreement and did state that “the plaintiff did not voluntarily surrender or abandon the premises, it was sold out from under him,” the trial court never did find that the defendant Storm Circle had breached the option agreement. The trial court’s statement that “it was sold out from under him” was made in relation to its conclusion of law “that the unjust enrichment doctrine applies to this case.” There is nothing in the record that suggests that either the parties or the trial court ever viewed this case as involving the issue of whether the defendant Storm Circle had breached the lease-option agreement. In fact, the record suggests otherwise. It was the plaintiff Gillette who had the duty of performance, i. e., obtaining the purchase price for the property in the manner provided for in the option. The record is clear that as of January 5, 1976, the final day for exercising the option, Gillette still had not obtained the necessary financing. As late as January 23, 1976, when the property was sold to Blincoe Farms, Gillette was still attempting to obtain financing.