MAINE SUPREME JUDICIAL COURT Reporter of Decisions Decision: 2019 ME 18 Docket: Han-18-196 Argued: December 11, 2018 Decided: January 29, 2019
Panel: SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and HUMPHREY, JJ.
JOHN SWEET II
v.
CARL E. BREIVOGEL et al.
HUMPHREY, J.
[¶1] In this appeal involving a dispute over payment for the construction
of a traditional timber frame home, we consider the connection between the
Home Construction Contracts Act (HCCA) and the Unfair Trade Practice Act
(UTPA), take this opportunity to underscore the significance of the statutory
requirement that construction contracts be formalized in writing, and affirm
the judgment. See 5 M.R.S. § 213(1), (2) (2017); 10 M.R.S. §§ 1487, 1490 (2017).
I. BACKGROUND
[¶2] The following facts are drawn from the court’s judgment and are
supported by competent evidence in the record. See Gravison v. Fisher,
2016 ME 35, ¶ 3, 134 A.3d 857. 2
[¶3] John Sweet II is a sole proprietor who specializes in the construction
of traditional timber frame homes, which involve a high level of labor, time, and
craftmanship. In February 2013, Carl E. and Elizabeth A. Breivogel contacted
Sweet through his construction-business website and inquired about building
“an enclosed, [weathertight] frame home” on land they own on Mount Desert
Island.
[¶4] In March 2013, the Breivogels traveled to Maine and met with Sweet
at his self-constructed timber frame home. During that visit, the Breivogels
viewed Sweet’s workshops as well as two other timber frame homes that Sweet
had constructed. While the parties did not reach any agreements that day,
Sweet did provide the Breivogels with some information about the relative
costs of the homes they visited. Specifically, he told the Breivogels that it would
cost approximately $500,000 to build a 28’ x 30’ completed home like his and
$400,000 to construct the 32’ x 32’ home they visited that was little more than
a “dried shell” or “weathertight” home.1
1 In their testimony, Sweet and his son, John Sweet III, explained that a “dried shell” or “weathertight” home refers to a building that has a traditional timber frame, a roof, and exterior walls, but does not have electricity, plumbing, fixtures, or completed rooms. Because cutting into the timbers after the frame is complete compromises the home’s structure and integrity, a dried shell is often built with an overall plan for the completed home in mind. In contrast, a completed home ready for occupancy includes features such as a kitchen, functioning bathrooms, light fixtures, and internal walls for rooms. 3
[¶5] After that meeting, the parties continued to communicate via email.
In one exchange dated March 26, 2013, the parties began to discuss the costs
associated with building a saltbox style2 timber frame home. The Breivogels
asked Sweet whether it would be possible to build a home of this style for
$275,000, not including the septic system for which the Breivogels would make
other arrangements. Sweet responded that it was possible, but difficult to be
certain at that early stage of the discussion because “the devil[’]s in the details.”
[¶6] From that point forward, the parties did not share the same
understanding of the scope and cost of the work Sweet was to perform. Sweet
believed that the Breivogels wanted him to construct an enclosed, weathertight
timber frame home—including only a frame, walls, roof, insulation, doors,
windows, chimney, and exterior shingles. In contrast, the Breivogels believed
that they had requested a fully completed home, ready for occupancy, costing
no more than $275,000.
[¶7] In April 2013, the Breivogels authorized Sweet to begin
construction; however, the parties never signed a contract. When the
Breivogels inquired when the parties would formalize the terms of the project,
2 A saltbox style home is “a house . . . having two stories in front and one at the rear, and a gable
roof with a much longer slope at the rear.” Saltbox, Webster’s New World College Dictionary (5th ed. 2016). 4
Sweet insisted that he had never signed a written contract in over thirty years
of business. The parties did, however, arrange that the Breivogels would be
billed biweekly and pay for all materials and any labor at $32 an hour.
[¶8] Sweet and his team began construction of a dried shell structure in
the summer of 2013 and completed the work in December of that year.
Throughout the project, Sweet sent numerous emails to the Breivogels
containing photographs depicting the progress on their home. He also
provided biweekly invoices; despite these frequent communications, however,
Sweet’s overall record-keeping process throughout the project was highly
informal.
[¶9] After December, both parties understood that work on the home
would progress beyond the dried shell phase. At that point, the Breivogels
determined, without informing Sweet, that they would have Sweet continue to
work on the project, but would initiate legal action against him after they
obtained a certificate of occupancy. They intended to seek damages for
payments made in excess of $275,000. The Breivogels continued to pay Sweet
until May 4, 2014. Construction of the home was completed and the Breivogels
received their certificate of occupancy on May 15, 2014. 5
[¶10] In total, Sweet billed the Breivogels $602,250.98 for materials and
services. The Breivogels had paid $601,195.75. After the Breivogels refused to
tender any further payments, Sweet placed a $51,953.94 lien on the home for
unpaid labor and brought this action against the Breivogels for that amount
plus interest.3 The Breivogels asserted counterclaims for negligence, breach of
contract, fraud, negligent misrepresentation, breach of the implied warranty of
workmanship, and a violation of the UTPA.
[¶11] The Superior Court (Hancock County, R. Murray, J.) concluded that
Sweet was entitled to the money that he had already received from the
Breivogels for the home under the theory of quantum meruit; however, the
court also determined that Sweet had actually overcharged the Breivogels by
$640.77 for the work performed by a tiler. With respect to the Breivogels’
counterclaims, the court concluded that they failed to establish that Sweet was
negligent, had breached any contractual obligation to perform in a
workmanlike manner, or had breached any implied warranty relating to
workmanship. It also determined that Sweet did not commit fraud or negligent
misrepresentation. However, the court did find that Sweet violated the HCCA
3 Although the record is sparse with regard to the basis for this amount, Sweet testified that he
filed the lien to recover money owed to him for his own labor and for work performed on the project by the plumbing contractor. 6
by failing to furnish a written contract, which was prima facie evidence of a
UTPA violation.
[¶12] The Breivogels filed a motion for amended and additional findings
of fact and conclusions of law. The court declined to amend the factual findings,
but awarded the Breivogels $3,832.43 in costs and $30,000 in attorney fees as
permitted by the UTPA. The Breivogels timely appealed. M.R. App. P. 2A(a),
2B(c).
II. DISCUSSION
[¶13] The Breivogels contend that the Superior Court erred in
(1) determining that they did not meet their burden of proof as to their
counterclaims for fraud, negligent misrepresentation, and breach of contract;
(2) calculating the damages recoverable under the UTPA stemming from
Sweet’s violation of the HCCA; and (3) awarding an insufficient amount of
attorney fees. We disagree and affirm the trial court’s judgment in full.
A. The Breivogels’ Counterclaims
[¶14] Because, at trial, the Breivogels had the burden of proof on each of
their counterclaims and the Superior Court concluded that they failed to meet
their burden, we must determine whether, on appeal, they have demonstrated
that “a contrary finding is compelled by the evidence.” Gravison, 2016 ME 35, 7
¶ 31, 134 A.3d 857 (quotation marks omitted); see also Young v. Lagasse,
2016 ME 96, ¶ 8, 143 A.3d 131; Rice v. Cook, 2015 ME 49, ¶ 11, 115 A.3d 86;
St. Louis v. Wilkinson Law Offices, P.C., 2012 ME 116, ¶¶ 16, 19, 55 A.3d 443.
Because the Breivogels moved for amended and additional findings of fact and
conclusions of law pursuant to M.R. Civ. P. 52, we “review the original findings
and any additional findings made in response to the motion for findings to
determine if they are sufficient, as a matter of law, to support the result and if
they are supported by the evidence in the record.” Bayberry Cove Childrens’
Land Tr. v. Town of Steuben, 2013 ME 35, ¶ 5, 65 A.3d 1188 (quotation marks
omitted).
[¶15] The evidence did not compel the court to issue findings necessary
for the Breivogels to prevail on their counterclaims. See Gravison, 2016 ME 35,
¶ 31, 134 A.3d 857. The court was entitled to find, as it did, that throughout the
construction process, the parties held different understandings of the work to
be performed and the total cost of the project. The court was also entitled to
find that, because of this difference in understanding, the parties did not form
an express contract. Therefore, the court did not err in concluding that the
Breivogels failed to prove that Sweet committed fraud, negligent
misrepresentation, or breach of contract. See Young, 2016 ME 96, ¶ 8, 8
143 A.3d 131; Rice, 2015 ME 49, ¶ 11, 115 A.3d 86; St. Louis, 2012 ME 116, ¶ 16,
55 A.3d 443; see also Gordon v. Cheskin, 2013 ME 113, ¶ 12, 82 A.3d 1221
(“Factual findings should not be overturned in an appellate proceeding simply
because an alternative finding also finds support in the evidence.”) (quotation
marks omitted).
B. Damages
[¶16] The Breivogels also contend that the court abused its discretion in
its award of damages in this case. Because the court found that there was no
contract between the parties, it applied the principles of quantum meruit and
concluded that the Breivogels had suffered a “relatively slight loss of money in
the amount of $640.77” under the UTPA. The Breivogels argue that the court’s
application of this legal principle was misplaced because the parties never
reached a common understanding of the material terms of the project and
because Sweet’s violations of the HCCA and UTPA warranted a larger award of
damages. We will vacate an award of damages only when there is no competent
evidence in the record to support it. Woodworth v. Gaddis, 2012 ME 138, ¶ 9,
58 A.3d 1109. 9
1. Quantum Meruit
[¶17] Quantum meruit is appropriate where there is no formal written
contract but a contract implied in fact can be inferred from the parties’ conduct.
See Paffhausen v. Balano, 1998 ME 47, ¶ 9, 708 A.2d 269. In these
circumstances, quantum meruit requires that “(1) services were rendered to
the defendant by the plaintiff; (2) with the knowledge and consent of the
defendant; and (3) under circumstances that make it reasonable for the plaintiff
to expect payment.” Id. ¶ 8 (citations and quotation marks omitted). Although
contract formalities do not exist with respect to an implied contract, there must
be a reasonable expectation of compensation for goods or services rendered.
See id. ¶ 9. A party may recover under quantum meruit even where “there was
not a clear accession on both sides to one and the same terms” if it is clear from
the circumstances that the services were not intended to be gratuitous. Id.
(quotation marks omitted).
[¶18] In this case, while it is clear that the parties did not sign a contract
or share an exact understanding of the scope and terms of construction, the
court’s application of quantum meruit was appropriate. The parties engaged in
months of discussions and planning before the project began and remained in
fairly constant communication throughout every phase of construction. In 10
particular, the binders of emails and hundreds of photographs admitted in this
case, combined with evidence of the Breivogels’ numerous site visits, support
the court’s conclusion that the Breivogels were aware of and assented to
Sweet’s performance of the work on their property. The Breivogels could have
terminated the project at any time, but instead continued working with Sweet,
despite admitted misgivings, and accepted the full benefit of Sweet’s services in
the form of a completed timber frame home ready for occupancy. Given the
court’s findings, to allow the Breivogels to accept the benefit of Sweet’s work
without paying the value of materials and services undercuts the purpose of
quantum meruit: to allow recovery for services rendered when the words or
conduct of the recipient created an expectation of compensation. See id. The
Breivogels permitted Sweet to continue the project beyond the dried shell
phase—the point at which the Breivogels realized that Sweet had a different
understanding of the scope and cost of construction—and allowed him to
continue working until their home was fit for occupancy.
[¶19] Moreover, contrary to the Breivogels’ arguments challenging the
court’s assessment of the reasonable value of the work Sweet completed, the
court did not err in its determination of damages. Based on the testimony of
the parties and Sweet’s expert witness, the evidence of multiple requested 11
upgrades and demands for luxury-quality materials, and the biweekly invoices
in evidence, the court did not abuse its discretion in determining that Sweet
was entitled to $600,554.98, which had already been paid by the Breivogels,
nor in concluding that the Breivogels overpaid by $640.77 for the tiler’s work.
2. Recovery Under the UTPA
[¶20] The Breivogels further argue that they are entitled to greater
recovery under the UTPA. See 10 M.R.S. § 1490; see also 5 M.R.S. § 213(1), (2).
Contrary to their arguments, the court understood correctly the interplay
between the HCCA and UTPA and properly applied the law in this case.
[¶21] The court found, and neither party disputes, that the agreement to
build the Breivogels’ home falls within the ambit of the HCCA. 10 M.R.S. § 1487.
The HCCA is intended to combat the problems of “faulty home construction,”
see L.D. 1044 (113th Legis. 1987), and requires that “[a]ny home construction
contract for more than $3,000 in materials or labor must be in writing.”
10 M.R.S. § 1487. While there is no remedy specified under the HCCA, a
violation of the HCCA is considered prima facie evidence of a violation of the
UTPA, which does provide for specific remedies, including restitution and
attorney fees. See 10 M.R.S. § 1490(1); see also 5 M.R.S. § 213(1), (2);
VanVoorhees v. Dodge, 679 A.2d 1077, 1082 (Me. 1996); Parker v. Ayre, 12
612 A.2d 1283, 1284-85 (Me. 1992). To recover under the UTPA, a party must
demonstrate “a loss of money or property as a result of a [UTPA] violation.”
Parker, 612 A.2d at 1285 (quotation marks omitted). Key inquiries into
whether the homeowners have suffered a financial or tangible loss are whether
the materials claimed to be furnished by the plaintiff were in fact furnished and
whether the prices were fair and reasonable. See id. In other words, in order
to recover under the UTPA, the homeowners must demonstrate that they did
not receive the value that should have been conferred. See id.
[¶22] The Breivogels are not entitled to additional recovery under the
UTPA because they failed to demonstrate that they did not receive value for
their payments for Sweet’s services. The court properly relied on Parker, a case
that, as the court noted, mirrors the facts and legal analysis applicable in the
Breivogels’ case. Like the homeowner in Parker, the Breivogels (1) proved
violations of the HCCA and UTPA, but failed to identify any injury or
demonstrate a substantial loss of money or property resulting from the
violations—i.e. a loss stemming specifically from Sweet’s failure to memorialize
the parties’ agreement in writing—and (2) received the benefit of the materials
and services provided by Sweet. Id. at 1284-85; see also Tungate v. 13
MacLean-Stevens Studios, Inc., 1998 ME 162, ¶¶ 9-11, 714 A.2d 792. Therefore,
they are not entitled to additional damages under the UTPA.
C. Attorney Fees
[¶23] Finally, the Breivogels argue that the Superior Court abused its
discretion in awarding them only $30,000 in attorney fees when they requested
over three times that amount. Because the trial court is in the best position to
observe the unique nature and tenor of the litigation as it relates to a request
for attorney fees, we review the grant of fees for abuse of discretion and any
underlying factual findings for clear error. See Roussel v. Ashby, 2015 ME 43,
¶ 10, 114 A.3d 670.
[¶24] “[A]n award of attorney fees pursuant to the UTPA is recoverable
only to the extent that it is earned pursuing a UTPA claim.” William Mushero,
Inc. v. Hull, 667 A.2d 853, 855 (Me. 1995). Because “courts have no authority to
award attorney’s fees to a litigant in the absence of statutory authorization or
agreement by the parties,” Poussard v. Commercial Credit Plan, Inc.,
479 A.2d 881, 883 (Me. 1984), to recover fees, claimants must “apportion their
attorney fees between the claims for which fees may be awarded and the claims
for which there is no [statutory] entitlement to fees,” Advanced Constr. Corp. v.
Pilecki, 2006 ME 84, ¶ 30, 901 A.2d 189. Many claimants do this by submitting 14
affidavits and billing records tailored to show the court the connection between
the fees requested and the UTPA claim; however, there are cases in which the
fee and non-fee claims arise from common facts and are so deeply entwined
that separation is impossible. See id. ¶ 32.
[¶25] Here, the Breivogels did not distinguish between their fee and
non-fee claims. Instead, they asserted that they were entitled to recover the full
amount of their attorney fees because all of the claims and counterclaims in the
case were inextricably entwined with, and stemmed from, the UTPA violations.
Contrary to this argument, the court properly exercised its discretion in
determining a reasonable award of attorney fees based on its reasoned
application of the factors enumerated in Homeward Residential, Inc. v. Gregor,
2017 ME 128, ¶ 15, 165 A.3d 357, particularly the Breivogels’ limited degree of
success.4 The court did not err in awarding to the Breivogels fees for Sweet’s
4 When determining what constitutes reasonable attorney fees, the trial court considers the following factors:
(1) the time and labor required; (2) the novelty and difficulty of the questions presented; (3) the skill required to perform the legal services; (4) the preclusion of other employment by the attorneys due to acceptance of the case; (5) the customary fee in the community; (6) whether the fee is fixed or contingent; (7) the time limitations imposed by client or circumstances; (8) the degree of success; (9) the experience, reputation and ability of the attorneys; (10) the undesirability of the case; (11) the nature and length of the professional relationship with the client; and (12) awards in similar cases.
Homeward Residential, Inc. v. Gregor, 2017 ME 128, ¶ 15, 165 A.3d 357 (quotation marks omitted). 15
UTPA violation and for the Breivogels’ successful defense of Sweet’s claim for
additional payments, or in declining to award them fees for the counterclaims
on which Sweet prevailed and for which attorney fees are not recoverable. See
Roussel, 2015 ME 43, ¶ 10, 114 A.3d 670. We are not persuaded by the
Breivogels’ bare assertions that all of the claims and counterclaims in this case
are inextricably linked, and we affirm the Superior Court’s award of fees.
[¶26] In counterpoint to the Breivogels’ challenge to the sufficiency of
the attorney fees award in this case, the court’s judgment underscores the
importance of the statutory requirement of having written contracts in home
construction projects subject to the HCCA. 10 M.R.S. § 1487. In projects of this
magnitude, especially in an industry as specialized as the construction of
traditional timber frame homes, the absence of a written contract can lead to
unfulfilled expectations, immense confusion between homeowners and
contractors, and costly litigation. It is clear from the record that Sweet and the
Breivogels did not share the same understanding of the scope and cost of this
project, a failing that could have been clarified by a written agreement.
However, Sweet’s violations of the HCCA and UTPA were properly remedied by
the court. Not only must Sweet pay his own attorney fees, he must also pay
$30,000 of the Breivogels’ fees, a substantial penalty for his serious violations, 16
and, in addition, he has lost his lien claim of $52,478.35 for allegedly
uncompensated work.
The entry is:
Judgment affirmed.
Christopher E. Pazar, Esq. (orally), and William J. Kennedy, Esq., Drummond & Drummond, LLP, Portland, for appellants Carl E. and Elizabeth A. Breivogel
Daniel A. Pileggi, Esq. (orally), Acadia Law Group LLC, Ellsworth, for appellee John Sweet II
Hancock County Superior Court docket number CV-2014-52 FOR CLERK REFERENCE ONLY