Silver Dollar Motel, Inc. v. Taylor Electric Co.

761 P.2d 1006, 1988 Wyo. LEXIS 129, 1988 WL 99719
CourtWyoming Supreme Court
DecidedSeptember 27, 1988
Docket88-31
StatusPublished
Cited by5 cases

This text of 761 P.2d 1006 (Silver Dollar Motel, Inc. v. Taylor Electric Co.) is published on Counsel Stack Legal Research, covering Wyoming Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Silver Dollar Motel, Inc. v. Taylor Electric Co., 761 P.2d 1006, 1988 Wyo. LEXIS 129, 1988 WL 99719 (Wyo. 1988).

Opinion

ROONEY, Retired Justice.

This appeal is from a judgment awarding appellee, on the theory of quantum meruit, the cost of improvements made by it to appellant’s real property under a contract between it and appellant’s former tenant who took bankruptcy before paying appel-lee for the improvements.

We reverse.

Appellant words the issues on appeal:

“1. The trial court erred as a matter of law in ruling that the remedy of quantum meruit is available to the plaintiff, an electrical contractor, who having failed to foreclose a statutory lien against the defendant’s property, and not being in privity with the defendant property owner, lost the benefit of his bargain upon the insolvency of the defendant’s lessee, with whom he had contracted to make the improvements on the leased premises.
“2. The trial court erred by applying an incorrect measure of damages, i.e., the contract price, for improvements to the defendant’s leased premises, rather than the amount by which the defendant may have been actually enriched, i.e., the enhanced value of the improved premises.”

Appellee words them:

“1. Whether the [ ] equitable remedy of quantum meruit is available to the Plaintiff for recovering his costs for improvements made on the Defendant’s property if Defendant’s lessee becomes insolvent.
“2. Whether the trial court awarded the correct amount of damages to the Plaintiff by using the contract price as a measure of the damages.”

The basic facts in this case are not in dispute. Appellant, as owner of real property in Rock Springs, leased a portion of one of the buildings on the property to R. Lynne Pfeiffer (hereinafter referred to as “lessee”). In 1984, lessee and appellee entered into a contract under which appellee would do electrical remodeling work in the leased area of the building, i.e., the restaurant and lounge area. Appellee did the work, but lessee filed bankruptcy proceedings before paying for it. Appellee was listed as a creditor in the bankruptcy. Although notified of the bankruptcy proceedings, appellee did not file a proof of claim therein. Appellant was aware of the contract between lessee and appellee. Appellant’s manager, D.T. Cook, was present daily during the time the work was being performed. He was “interested” but did not request any changes or “issue instructions to any” of appellee’s employees. At Cook’s request, appellee ran a one and one-quarter inch conduit to a power panel instead of a one inch one so there would be sufficient power to supply an office which appellant contemplated at a later time in the building. The difference in cost was “not a great deal.” Later, appellee did electrical work for appellant on the office and elsewhere, and appellee was paid for such work by appellant.

Appellant agreed with lessee that lessee would be given “full credit against his *1008 lease over time” for the cost of remodeling, the lease being for three years with an option to renew for three years. It was a percentage lease with a minimum of $3,000 per month and utilities. There was no evidence as to the amount of credit for the cost, if any, that had been given to lessee by appellant prior to the time lessee breached the lease and filed bankruptcy. Nor is there any evidence as to whether or not the balance of the credit, if any, was listed as an asset in the bankruptcy or whether the obligation of lessee on the lease was listed therein as a debt.

Appellee filed a mechanic’s lien against the property for the electrical work but did not foreclose it in a timely fashion. Other mechanic’s liens were filed against the facility as a result of lessee’s bankruptcy. One went to judgment and was settled for “something in excess of $5,000.”

There was testimony that the materials and labor furnished by appellee for the project amounted to $15,780.56 (the amount of the judgment), but there was no other evidence of the amount and nature of damages or of the “enrichment.” Some of the electrical work performed by appellee was abandoned and not used by the new tenant leasing the space after lessee broke the lease with appellant and filed for bankruptcy-

AVAILABILITY OF QUANTUM MERUIT REMEDY

The law as applied to these particular facts will not sustain a judgment for appellee “under the equitable theory of Quantum Mer[u]it,” as requested in the amended complaint. The elements necessary to support recovery under an unjust enrichment theory were set forth by this court in Pancratz Company, Inc. v. Kloefkorn-Ballard Construction/Development, Inc., 720 P.2d 906, 908-09 (Wyo.1986):

“The elements necessary to support a claim for relief based upon quantum, me-ruit are:
“1) Valuable services were rendered, or materials furnished,
“2) to the party to be charged,
“3) which services or materials were accepted, used and enjoyed by the party, and
“4) under such circumstances which reasonably notified the party to be charged that the plaintiff, in rendering such services or furnishing such materials, expected to be paid by the party to be charged. Without such payment, the party would be unjustly enriched.
* * * * * *
“The central issue to the disposition of this case is whether appellee was unjustly enriched by the work performed by appellant. Not only must we find enrichment, but such enrichment must be unjust. Bereman v. Bereman, Wyo., 645 P.2d 1155 (1982); Rocky Mountain Turbines, Inc. v. 660 Syndicate Inc., Wyo., 623 P.2d 758 (1981); McGrath v. Ending, 41 N.Y.2d 625, 394 N.Y.S.2d 603, 363 N.E.2d 328 (1977).”

At least some of the services and materials here rendered or furnished by appellee were not “used and enjoyed” by appellant as required by the third element (supra), and the evidence does not reflect the existence of the fourth element (supra) in that the expectation for payment was shown to be by lessee and not by the person now sought to be charged, i.e., not by appellant. Not only do the facts surrounding the arrangement for the work and its accomplishment show expectation that payment would be made by lessee, but also the failure to perfect a lien against appellant’s property shows such expectancy. 1 Additionally, the “unjust” actor of the enrichment (referred to in Pancratz Company, Inc., 720 P.2d at 908-09) was not established by the evidence. The quantum meruit/unjust enrich-ments theory is founded on implied con *1009 tract — one that is dictated by equity. Pancratz Company, Inc., 720 P.2d 906.

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Cite This Page — Counsel Stack

Bluebook (online)
761 P.2d 1006, 1988 Wyo. LEXIS 129, 1988 WL 99719, Counsel Stack Legal Research, https://law.counselstack.com/opinion/silver-dollar-motel-inc-v-taylor-electric-co-wyo-1988.