City of Ingleside v. Stewart

• Decision Date: 31 March 1977
• Docket Number: No. 1111,1111
• Citation: 554 S.W.2d 939
• Court: Texas Court of Appeals
• Parties: The CITY OF INGLESIDE, Appellant, v. T. R. STEWART, d/b/a L & S Air Conditioning Co., Inc., Appellee.

Page 939

554 S.W.2d 939

The CITY OF INGLESIDE, Appellant, v. T. R. STEWART, d/b/a L & S Air Conditioning Co., Inc., Appellee.

No. 1111.

Court of Civil Appeals of Texas, Corpus Christi.

March 31, 1977.

Rehearing Denied June 30, 1977.

Second Rehearing Aug. 31, 1977.

Bruce D. Viles, Wood, Burney, Nesbitt & Ryan, Corpus Christi, for appellant.

Mark H. Giles, Stone, Berryman & Giles, Corpus Christi, for appellee.

OPINION

NYE, Chief Justice.

This is an appeal from a judgment against the City of Ingleside which awarded $4,700.00 and interest to L & S Air Conditioning Company, Inc. The suit was brought by the Air Conditioning Company to recover for the installation of the heating and air conditioning system in the criminal justice facility in Ingleside, Texas. Trial was to the court. From this judgment the City has perfected its appeal to this Court.

In August of 1970, the City sustained considerable damage to its facilities as a result of Hurricane Celia. One of the buildings damaged was the City Hall. It was decided by the City Council to rebuild and remodel this structure and turn it into a criminal justice facility. This rebuilt facility was to house the Municipal Court, the Police Department and offices for the Department of Public Safety. In connection with this rebuilding project, Charles Bellah, a Corpus Christi architect and engineer was hired to design several structures including the subject Criminal Justice Building. The funding for the construction of the building was obtained through the Celia relief fund and a matching grant from the Texas Criminal Justice Council in the total amount of $48,375.00. Bids were solicited for the project and the construction contract was awarded to Sherrahl D. Smith for the exact amount. Subsequently, Smith, subcontracted the heating and air conditioning work to the appellees for $5,075.00.

In late August or early September of 1971, the City became dissatisfied with the progress being made on the facility by contractor Smith. Smith had already received $17,136.23 in draws, and was requesting additional funds, when it was determined that the subcontractors were not being paid. It was then the joint opinion of the City's Mayor, Jerry Storms, and the Project Architect and Engineer, Charles Bellah, that contractor Smith was not entitled to any additional draws from the City for the project, at least at that time. On recommendation of the architect, the City instituted a dual payee check system to insure that the various laborers and subcontractors would be paid. Under this dual-payee system, each check drawn from the Criminal Justice Facility fund was made out to contractor Smith and the laborer or subcontractor to be paid. The contractor would periodically come to the City's offices, endorse the checks, and the City would then have the checks either picked up by the appropriate payees, or delivered to their places of business. This procedure was maintained until December of 1971, when the fund became virtually exhausted.

The appellees began working on the building in October of 1971, after receiving a phone call from someone purporting to be Rick Diegel, the then mayor pro tem of the City, stating that it was time to install the heating and air conditioning units. On October 31, 1971, appellees prepared an interim bill for $3,187.00 addressed to Diegel at the City Hall. This bill was not paid. On December 1, 1971, the appellees completed the work on the building and prepared a final billing in the amount of their contract ($5,075.00), and addressed the bill to the same Rick Diegel at Ingleside City Hall. This bill was likewise not paid. In April 1972, after the City had commenced using the facilities, one of the fans in the air conditioning system malfunctioned. The City contacted the appellee Air Conditioning Company and requested repairs to be made. The appellee company removed the fan from the building, but because they had not been paid for the job, refused to repair or return the fan.

The City never paid appellee for its work. The appellee did not choose to collect from contractor Smith, choosing instead to sue the City. The case was tried to the court without a jury. At the conclusion of the trial, judgment was rendered for appellees in the amount of $4,700.00 plus pre-judgment interest at 6% from December 1, 1971 through January 26, 1976, and post-judgment interest at a rate of 9%. In response to a request by the City, the trial judge made extensive findings of fact and conclusions of law, all of which are germane to the City's points of error presented by this appeal.

The City in points of error 1-23 complains of the findings of fact made by the trial court in support of its judgment that appellees are entitled to recover $4,700.00 based on quantum meruit. This Court in reviewing no evidence and insufficient evidence points of error based on the trial court's findings of fact must use the same test for factual sufficiency as is applied to jury answers. V. K. Hall v. Villarreal Development Corporation, 522 S.W.2d 195 (Tex.Sup.1975). Therefore, in considering the City's "no evidence" points of error, we must look only to that evidence which supports the trial court's findings and disregard all other evidence to the contrary. In reviewing the City's "insufficient evidence" points of error, we must consider and weigh all the evidence in the record and set aside the trial court's verdict if we conclude that the evidence is insufficient to support the trial court's findings. In re King's Estate, 150 Tex. 662, 244 S.W.2d 660 (1951). Calvert "No Evidence and Insufficient Evidence Points of Error", 38 Tex.L.Rev. 359 (1960).

The most recent definition of quantum meruit was stated in Black Lake Pipe Line Company v. Union Construction Company, Inc., 538 S.W.2d 80 (Tex.Sup.1976). The court said that ". . . the right to recover in quantum meruit is based upon a promise implied by law to pay for beneficial services rendered and knowingly accepted." See Davidson v. Clearman, 391 S.W.2d 48 (Tex.Sup.1965); McDaniel v. Tucker, 520 S.W.2d 543 (Tex.Civ.App. Corpus Christi 1975, no writ). Quantum meruit is a principal of equity based on the theory that if one performs work for another and such work is accepted by the other, non payment for such work would result in an unjust enrichment to the party benefited by the work. University State Bank v. Gifford-Hill Concrete Corporation, 431 S.W.2d 561 (Tex.Civ.App. Fort Worth 1968, writ ref'd n. r. e.); Kramer v. Wilson, 226 S.W.2d 675 (Tex.Civ.App. Fort Worth 1950, writ ref'd n. r. e.).

The necessary elements of recovery under quantum meruit were set out by this Court in Montes v. Naismith and Trevino Construction Company, 459 S.W.2d 691 (Tex.Civ.App. Corpus Christi 1970, writ ref'd n. r. e.). These elements are: 1) valuable services were rendered or materials furnished; 2) for the person sought to be charged; 3) which services and materials were accepted by the person sought to be charged, used and enjoyed by him; 4) under such circumstances as reasonably notified the person sought to be charged that the plaintiff in performing such services was expecting to be paid by the person sought to be charged. See Colbert v. Dallas Joint Stock Land Bank, 136 Tex. 268, 150 S.W.2d 771 (1941); Rogers-Hill & Co. v. San Antonio Hotel Co., 23 S.W.2d 329 (Tex.Comm'n App.1930, holding approved); Olivares v. Porter Poultry & Egg Company, 523 S.W.2d 726 (Tex.Civ.App. San Antonio 1975, no writ); Crockett v. Sampson, 439 S.W.2d 355 (Tex.Civ.App. Austin 1969, no writ). See also Kendall Company v. Plastic Engineering & Sales Corporation, 350 S.W.2d 661 (Tex.Civ.App. Fort Worth 1961, writ ref'd n. r. e.); Kramer v. Wilson, supra.

At least 7 witnesses testified that the heating and air conditioning system was installed in the Criminal Justice Building for the City of Ingleside by the appellee company. The President, T. R. Stewart, testified that he expended $5,075.00 in equipment and labor while installing the heating and air conditioning system. This testimony was substantiated by appellee's various exhibits which represented appellee's estimates for the work performed and the invoices for the equipment purchased for the building. There were several witnesses, including members of the City Council in 1971 and 1972, who testified that the services rendered by the appellee were accepted by the City and were used and enjoyed by the City.

This brings us to the final elements of quantum meruit: whether the services rendered and the equipment furnished by appellee were accepted and used by the City under such circumstances as would reasonably notify the City that appellee expected the City to pay for its work. The basis for a claim in quantum meruit is either an express or implied agreement to pay for the work. Stone Company, Inc. v. Carminati, 317 S.W.2d 78 (Tex.Civ.App. Fort Worth 1958, no writ); Wyche v. Perrin, 228 S.W.2d 330 (Tex.Civ.App. Dallas 1950, writ ref'd n. r. e.). See also Electric Wire & Cable Co. v. Ray, 456 S.W.2d 260 (Tex.Civ.App. Houston (14th Dist.) 1970, writ ref'd n. r. e.); Schneider v. Delwood Center, Inc., 394 S.W.2d 671 (Tex.Civ.App. Austin 1965, writ ref'd n. r. e.); Johnson v. Walker, 330 S.W.2d 508 (Tex.Civ.App. San Antonio 1959, no writ).

Ms. Rosalie Eddings, who was secretary and bookkeeper for the appellee company, testified that Mr. Diegel, the City's mayor pro tem, called her on three or four occasions and told her he was from the City of Ingleside and that it was time for the air conditioning company to install the heating and air conditioning system. As a result of these calls, appellee commenced the work on the facilities. Mr. Diegel denied that he had instructed the appellee to commence the work. He did state that he may have called them in connection with the electrical work that he was personally doing on the building. The City objected to the testimony of Ms. Eddings. Ms. Eddings admitted that she had never met...