Britt v. Britt

• Decision Date: 03 September 1987
• Docket Number: No. 566PA86,566PA86
• Parties: Betsy Bracy BRITT and Robert Dixon Britt v. Billy B. BRITT and Peggy G. Britt, jointly and severally, and Magnolia Hill Inc.
• Court: North Carolina Supreme Court

Page 467

359 S.E.2d 467

320 N.C. 573

Betsy Bracy BRITT and Robert Dixon Britt v. Billy B. BRITT and Peggy G. Britt, jointly and severally and Magnolia Hill Inc.

No. 566PA86.

Supreme Court of North Carolina.

Sept. 3, 1987.

Womble, Carlyle, Sandridge & Rice by Carole S. Gailor, Raleigh, for plaintiff-appellant Betsy Bracey Britt.

Faison, Brown, Fletcher & Brough by Charles Gordon Brown and William D. Bernard, Chapel Hill, and Ward & Smith, P.A. by Robert D. Rouse, Jr., and Donald J. Eglinton, Greenville, for defendants-appellees.

WEBB, Justice.

The plaintiffs did not appeal from the judgment dismissing their claim for a parol trust and that question is not before us.

The appeal of the plaintiff Betsy Britt brings to the Court questions involving unjust enrichment and fraud. The Restatement of Restitution § 1 lays down the general principle that "a person who has been unjustly enriched at the expense of another is required to make restitution." In order to establish a claim for unjust enrichment, a party must have conferred a benefit on the other party. The benefit must not have been conferred officiously, that is it must not be conferred by an interference in the affairs of the other party in a manner that is not justified in the circumstances. The benefit must not be gratuitous and it must be measurable. See E. Allan Farnsworth, Contracts § 2.20. Wells v. Foreman, 236 N.C. 351, 72 S.E.2d 765 (1952), says that the defendant must have consciously accepted the benefit. A claim of this type is neither in tort nor contract but is described as a claim in quasi-contract or a contract implied in law. A quasi-contract or a contract implied in law is not a contract. The claim is not based on a promise but is imposed by law to prevent an unjust enrichment. If there is a contract between the parties the contract governs the claim and the law will not imply a contract. Concrete Co. v. Lumber Co., 256 N.C. 709, 124 S.E.2d 905 (1962).

In this case we believe the plaintiff Betsy Britt has introduced evidence which, if believed, entitles her to restitution for any damages she may prove. The defendant Billy Britt promised the plaintiffs he would convey the farm to them when they "hit diamond." That was an oral promise and unenforceable under the statute of frauds. N.C.G.S. § 22-2. There was no evidence that the plaintiffs "hit diamond" and the plaintiffs could not have compelled a conveyance for this reason. The unenforceable contract does keep the plaintiffs' action in making improvements to the farm from being officious. Neither of the plaintiffs was a volunteer in making improvements because they could reasonably expect that they would be paid for them if the farm was not conveyed to them. The defendant Billy Britt was aware of any improvements as they were made. Wells, 236 N.C. 351, 72 S.E.2d 765.

In her proof of damages, the plaintiff Betsy Britt introduced expert testimony as to the reasonable value of her services. It was error to allow this testimony. In this case, the evidence showed there were two contracts between the parties. One of the contracts was to convey the farm when the plaintiffs "hit diamond." There was another contract for the operation of the farm. There is some dispute about this. The plaintiff Betsy Britt contends she was the owner of the farm operation. Billy Britt contends that Betsy worked for him and that her compensation was to be allowed to live in the house rent free and to retain any surplus income from the farm operations. If Betsy operated the farm as her own business, the value of her services were of no consequence to Billy Britt. He should not have to pay for them. If Betsy Britt worked for Billy in operating the farm, she made an express contract with him for compensation. She was to live in the house rent free and receive all surplus income from the farm. She made an express contract for her pay and the law will not imply one for her. Concrete Co., 256 N.C. 709, 124 S.E.2d 905 and Supply Co. v. Clark, 247 N.C. 762, 102 S.E.2d 257 (1958). For this reason it was error to let the jury consider the reasonable value of her services.

Betsy Britt also introduced evidence of payments on the indebtedness on the farm to show Billy Britt was unjustly enriched by the payments. There was a conflict in the evidence as to these payments. The plaintiff Betsy Britt contends that in the agreement between the parties these payments were not intended to be paid from the gross income from the farm. If the jury should find it was not part of the contract between the parties that the payments should be paid from the gross income, Betsy's compensation was reduced by making payments for the defendant Billy Britt and she would be entitled to compensation for these payments which unjustly enriched Billy Britt. There was evidence that she continued making the payments after she was told to leave the farm in March 1984. Betsy would not be entitled to damages for payments after she was told to leave the farm. She would be acting officiously in making payments after she was told to leave.

The plaintiffs also introduced evidence that Betsy expended $40,460.99 in making improvements on the farm. If the jury should find that the expenditures were made not as normal business expenses in operating the farm but were made by Betsy from her own funds or funds she should have been allowed to keep from the operation of the farm, the plaintiffs should recover for such expenditures. The measure of damages should be the amount the expenditures have enhanced the value of the farm. Wright v. Wright, 305 N.C. 345, 289 S.E.2d 347 (1982) and Jones v. Sandlin, 160 N.C. 150, 75 S.E. 1075 (1912).

The plaintiffs also obtained a judgment against the defendants based on fraud. The elements of fraud are: (1) the defendant's false representation of a past or existing fact, (2) defendant's knowledge that the representation was false when made or it was made recklessly without any knowledge of its truth and as a positive assertion, (3) defendant made the false representation with the intent it be relied on by the plaintiff, and (4) the plaintiff was injured by reasonably relying on the false representation. Johnson v. Insurance Co., 300 N.C. 247, 266 S.E.2d 610 (1980). Evidence of a promise which is not fulfilled is not sufficient to support a finding of a false representation unless the evidence shows the promisor made the promise with no intention of fulfilling it. Hoyle v. Bagby, 253 N.C. 778, 117 S.E.2d 760 (1961).

The plaintiff Betsy Britt contends that in a conversation by telephone with her, Billy Britt made a promise to her that he had no intention of keeping, that he made this representation to keep her working on the farm and making the mortgage payments, and that she reasonably relied on this false representation to her injury. She contends the false promise was made when she asked Billy Britt to put their contract in writing...