Turnkey Corp. v. Rappeport

720 P.2d 115, 149 Ariz. 514, 1986 Ariz. App. LEXIS 471
CourtCourt of Appeals of Arizona
DecidedFebruary 13, 1986
DocketNo. 2 CA-CIV 5506
StatusPublished
Cited by1 cases

This text of 720 P.2d 115 (Turnkey Corp. v. Rappeport) is published on Counsel Stack Legal Research, covering Court of Appeals of Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Turnkey Corp. v. Rappeport, 720 P.2d 115, 149 Ariz. 514, 1986 Ariz. App. LEXIS 471 (Ark. Ct. App. 1986).

Opinion

OPINION

FERNANDEZ, Judge.

Appellee Turnkey Corporation is an Arizona corporation and a licensed contractor whose president is James Schibley. Appellant Jack Rappeport is the owner of a home on Kleindale Street in the Winterhaven area of Tucson which he purchased in June 1982, an unimproved lot on Edison Street in Tucson and a cabin on Mt. Lemmon. Turnkey sued Rappeport for breach of contract, quantum meruit and unjust enrichment. Rappeport’s answer denied liability and claimed setoffs for inaccurate and fraudu[515]*515lent billings. He counterclaimed for fraud, conversion and negligence. After a lengthy court trial, the court found that Rappeport had requested Turnkey to perform certain work on the Mt. Lemmon cabin and awarded it $4,000. Turnkey was also awarded $1,773.65 for a set of plans prepared at Rappeport’s request for the property on Edison Street. Finally, the court found that Rappeport had requested Turnkey to refurbish the Kleindale home and awarded it $42,000 for the remodeling. In its findings of fact and conclusions of law, the court found that there was no express contract between the parties on any of the projects. It further found that Rappeport had requested Turnkey to perform the projects, that Turnkey had expended labor and materials in performing them and that it was entitled to recover on the basis of quantum meruit. The issues raised by counterclaim were considered by the court in determining the amount of recovery.

On appeal Rappeport contends that the judgment in quantum meruit was not supported by the evidence and the law of Arizona on the question of damages in an action for unjust enrichment. Arguing that there cannot be a recovery under the theory of unjust enrichment unless the defendant has been enriched, he contends that Turnkey failed to prove that Rappe-port benefited from the work done and that Turnkey’s recovery should not be based on either the cost to Turnkey or the value of each item of work done. We disagree and affirm.

Turnkey has cross-appealed, contending 1) the trial court erred in not finding that an oral contract had been entered into, 2) that if recovery is affirmed on quantum meruit, then the recovery should bear a reasonable relation to the materials and services provided so that it was error to award less than actual costs and 3) that Turnkey should have been awarded attorney’s fees under either theory. We find that the evidence supported the judgment and that the attorney’s fee determination was proper.

Rappeport, an attorney and former law professor at the University of Arizona, first contacted James Schibley in November 1981 about installing log siding on Rappeport’s Mt. Lemmon cabin. That job was completed by Turnkey on a cost plus 10% overhead plus 10% profit plus sales tax basis, as was a project to build shelving at Rappeport’s law office. Thereafter Schib-ley acted as Rappeport’s expert witness in a termite damage lawsuit in which the cost plus 10% plus 10% plus sales tax method was used in estimating the required repairs. Turnkey also built two triplexes for Rappeport for $176,000 which was paid on the same cost plus basis. No written contract was ever signed between the parties on any of the projects involved.

In June 1982 Rappeport contacted Schib-ley about remodeling his newly-purchased home on Kleindale Street. Rappeport wanted extensive remodeling done immediately, and Schibley testified Rappeport told him he wanted the best of everything in the house. Schibley testified he told Rappeport that the project would be done on a cost plus basis the same as the other projects. He told Rappeport he would furnish copies of all time cards, invoices and the cost breakdown by the 25th of each month and that payment was due on the 5th day of the following month so that the subcontractors and employees would be paid by the 10th. Turnkey commenced the remodeling and four periodic billings were delivered. Rappeport paid the first three but not the fourth, which was for $56,-456.35. The failure to pay that billing was one of Turnkey’s claims in this lawsuit.

Turnkey also sought $5,600.65 for additional remodeling work on the Mt. Lemmon cabin. In July 1982 Turnkey had bought a lot on Edison Street in Tucson for Rappe-port and, as its third claim, sought $1,875.06 for preparing a set of plans for a house that Rappeport wanted to build on that property..

Rappeport had paid $88,000 for the Kleindale home, and he testified he paid Turnkey over $54,000 before he refused to pay the final billing. He declined to pay [516]*516more, believing he had an express contract that the work would be completed for not more than $50,000. He further testified he paid other contractors $29,000 for additional remodeling and, on completion of the work, had over $171,000 invested in the home. Turnkey’s witnesses testified as to the reasonableness of the cost of the work and as to the work performed. Rappe-port’s witnesses testified in defense of the express contract count that all the work could have been done for the $50,000 limit and testified as well on reasonable cost of the work. In addition, Rappeport called a real estate broker and a real property appraiser who testified that the reasonable value of the property after the improvements was only $108,000 to $110,000.

Both parties have cited the recent case of Murdock-Bryant Construction, Inc. v. Pearson, 146 Ariz. 48, 703 P.2d 1197 (1985) as persuasive authority on the appropriate measure of damages. In that case, a subcontractor brought an action for rescission and restitution because of the general contractor’s misrepresentations as to the amount of rock to be blasted. Judgment was entered against the contractor as well as against an individual and a corporation who were joint venturers with the contractor. The court held that the joint venturers were not responsible for the contractor’s misrepresentation, but that restitution was proper against the joint venturers because a benefit had been conferred on them. On remand the court left the measure of damages to the trial judge, noting that the measure was different as to different parties because the joint venturers were not liable for any misrepresentations.

Unlike Murdock-Bryant, in the present case there was no misrepresentation involved, and the project was finished before the dispute arose. The issues here revolved around Turnkey’s contention that it was to be paid on a cost plus basis and that Rappeport had requested extensive remodeling work that cost more than if the house had been built from scratch. Although Rappeport does not deny that he requested the work to be done, he claims that he set a top limit on the total expenditure and that Turnkey’s expended costs were not reasonable. These issues were determined by the court which found for Turnkey but which allowed an offset for defects and negligent work and set a reasonable value for the work done. We find ample evidence to support the court’s finding of reasonable value for the services performed.

Rappeport contends that the benefit to the recipient as measured by the resulting market value should be the measure of damages in an action for restitution. Because the value of the house is much less than the costs incurred by Turnkey in remodeling it, he contends he should not pay anything since he has received no benefit. Spitalny v. Tanner Construction Co., 75 Ariz. 192, 254 P.2d 440 (1953), overruled on other grounds, Schwartz v.

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Cite This Page — Counsel Stack

Bluebook (online)
720 P.2d 115, 149 Ariz. 514, 1986 Ariz. App. LEXIS 471, Counsel Stack Legal Research, https://law.counselstack.com/opinion/turnkey-corp-v-rappeport-arizctapp-1986.