McCorry v. G. Cowser Construction, Inc.

636 N.E.2d 1273, 1994 Ind. App. LEXIS 862, 1994 WL 315979
CourtIndiana Court of Appeals
DecidedJuly 6, 1994
Docket45A05-9306-CV-196
StatusPublished
Cited by20 cases

This text of 636 N.E.2d 1273 (McCorry v. G. Cowser Construction, Inc.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McCorry v. G. Cowser Construction, Inc., 636 N.E.2d 1273, 1994 Ind. App. LEXIS 862, 1994 WL 315979 (Ind. Ct. App. 1994).

Opinion

BARTEAU, Judge.

Richard and Suzanne McCorry (McCorry) appeal from the trial court’s judgment in favor of four subcontractors who sought payment from McCorry after the general contractor breached its agreements with both McCorry and the subcontractors. Two of the subcontractors claim payment based on a theory of unjust enrichment and quantum meruit, and the other two seek to foreclose mechanic’s liens or, in the alternative, bring actions pursuant to notices of personal responsibility filed under the Indiana mechanic’s hen statutes.

We modify the trial court’s judgment with regard to two of the appellees in order to clarify the legal basis for those judgments, and to correct the amount of one of the judgments, and affirm as modified.

FACTS

In the late spring and early summer of 1990, McCorry secured estimates from several contractors for the construction of a house on some real estate McCorry owned in St. John, Indiana. On July 19, 1990, McCorry entered into a contract with Contemporary Builders of Indiana, Inc. and Jack Sokol (Sokol) which provided that Sokol would erect a single-family house on the McCorry real estate at a cost of $170,000. McCorry made a $5,000 down payment, leaving a contract balance of $165,000. The McCorry-Sokol contract was contingent upon McCorry obtaining a commitment for construction financing in the amount of $165,000 within 30 days of the date of the execution of the contract. However, McCorry did not even apply for financing until sometime in the spring of 1991, some nine months after the contract was entered into. McCorry received a commitment for financing, but let it lapse because the house was still not finished at the time, and applied for new financing in the fall of 1992. McCorry also had the right under the contract to require payments to be made to Sokol through a title company escrow account, but elected not .to do so.

Sokol subsequently entered into agreements with a number of subcontractors to provide materials and labor for the house, including the four plaintiff-appellees in this appeal. Those subcontractors are G. Cowser Construction, Inc. (Cowser), for concrete and masonry work; Snow-N-Son, Inc. (Snow), for excavating services, stone, fill, and grading; L. Scott Electric Co., Inc. (Scott), for electrical wiring and fixtures; and Impact Heating and Air Conditioning, Inc. (Impact), for the furnace, duct work, humidifier, and air conditioning.

The estimated completion date of the house under the McCorry-Sokol contract was January 20, 1991. The contract provided that McCorry was not to occupy the premises until full payment of the purchase price was made. McCorry could inspect the premises at any time during construction, but was to deal solely with Sokol and not with any of Sokol’s subcontractors. However, the trial court found that beginning in January of 1991, McCorry exercised increas *1276 ing control over the construction, regularly contacting subcontractors, promising payment, acquiring materials, and arranging for work to be completed.

Sokol did not complete the construction within the time provided in the Sokol-McCorry contract, and, in fact, left the structure uncompleted. Sokol also failed to pay for tools, machinery, and equipment supplied for the building by subcontractors. McCorry was aware by January 10, 1991, that Sokol had breached its contract, but made a partial payment to Sokol after that date.

McCorry paid Sokol $52,500 between the date the contract was entered into and January 31, 1991, and paid Sokol $50,800 on February 1, 1991, a total of $103,300. Thereafter, McCorry selectively paid subcontractors and suppliers a total of $77,772.59, some of which was for items not included in the McCorry-Sokol contract.

STANDARD OF REVIEW

This was a bench trial in which the trial court made special findings of fact and conclusions of law pursuant to an Ind. Trial Rule 52(A) motion by counsel for plaintiffs Cowser and Snow. When the trial court has made special findings, this court on appeal applies a two-tiered standard of review. First, we must determine whether the evidence supports the findings. Then, we must determine whether the findings support the judgment. If the special findings support the judgment and are not clearly erroneous, the judgment must be affirmed. We will consider only the evidence in the record which supports the judgment, along with the reasonable inferences to be drawn from the evidence. United Farm Bureau Mut. Ins. Co. v. Ira (1991), Ind.App., 577 N.E.2d 588, 592, trans. denied.

Because the claims of Scott, Impact, Cow-ser and Snow may fairly be characterized as falling within only two causes of action, we will analyze the Scott and Impact claims together as an unjust enrichment question, and the Cowser and Snow claims as a personal responsibility and mechanic’s lien issue.

UNJUST ENRICHMENT

There are four criteria to evaluate whether evidence supports a judgment under a theory of unjust enrichment in a dispute between a subcontractor and a property owner. They are:

1. Whether the owner impliedly requested the subcontractor to do the work;
2. Whether the owner reasonably expected to pay the subcontractor, or the subcontractor reasonably expected to be paid by the owner;
3. Whether there was an actual wrong perpetrated by the owner; and
4. Whether the owner’s conduct was so active and instrumental that the owner “stepped into the shoes” of the contractor.

Stafford v. Barnard Lumber Co. (1988), Ind., 531 N.E.2d 202, 204. The evidence supports the trial court’s findings of unjust enrichment.

Scott Claim

On July 21, 1990, Scott submitted a proposal to Sokol for electrical work on the McCorry house, which proposal was accepted by Sokol soon afterwards. The cost for the Scott work was $6,992, with 75% to be paid upon completion of the “rough” and the balance to be paid when the job was finished.

Before Scott started working on the house, he and McCorry went through the house and discussed a number of changes and additions to the original proposal. Scott indicated what the unit costs for the changes and additions would be, and, as a result of those discussions, McCorry made a number of substantial changes to the electrical system, adding switches, lights, and ceiling fans. McCorry also asked Scott to install television cable and jacks, which were not mentioned in the original Scott proposal. The Scott-Sokol contract required that any change orders be made in writing; however, no change orders were prepared. There was testimony that it is customary in the residential construction industry to make changes during construction without written orders. McCorry was on the job site frequently and saw the materials being used and the labor being performed by Scott. McCorry did not object to *1277 the quality of Scott’s labor or materials during the construction.

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Bluebook (online)
636 N.E.2d 1273, 1994 Ind. App. LEXIS 862, 1994 WL 315979, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mccorry-v-g-cowser-construction-inc-indctapp-1994.