City of Scottsbluff v. Waste Connections of Nebraska, Inc.

• Decision Date: 09 December 2011
• Docket Number: No. S–10–753.,S–10–753.
• Citation: 282 Neb. 848,809 N.W.2d 725
• Parties: CITY OF SCOTTSBLUFF, a municipal corporation, appellee, v. WASTE CONNECTIONS OF NEBRASKA, INC., appellant.
• Court: Nebraska Supreme Court

282 Neb. 848

809 N.W.2d 725

CITY OF SCOTTSBLUFF, a municipal corporation, appellee,

v.WASTE CONNECTIONS OF NEBRASKA, INC., appellant.

No. S–10–753.

Supreme Court of Nebraska.

Dec. 9, 2011.

Syllabus by the Court

1. Contracts: Parties: Intent: Words and Phrases. The term “implied contract” refers to that class of obligations that arises from mutual agreement and intent to promise, when the agreement and promise have simply not been expressed in words. An implied contract arises where the intention of the parties is not expressed but where the circumstances are such as to show a mutual intent to contract.

2. Contracts: Intent. If the parties' conduct is sufficient to show an implied contract, it is just as enforceable as an express contract.

3. Contracts. A claim that the parties created an enforceable contract generally presents an action at law.

4. Contracts: Restitution: Unjust Enrichment. A claim that a court should imply a promise or obligation to prevent unjust enrichment is sometimes referred to as an “implied-in-law contract” or a “quasi-contract.” Quasi-contract claims are restitution claims to prevent unjust enrichment.

5. Contracts: Restitution. Any quasi-contract claim for restitution is an action at law.

6. Actions: Contracts: Equity: Restitution. An action in assumpsit for money had and received may be brought where a party has received money that in equity and good conscience should be repaid to another. When a party uses an assumpsit action in this sense, it is a quasi-contract claim sounding in restitution.

7. Judgments: Appeal and Error. In a bench trial of a law action, the trial court's factual findings have the effect of a jury verdict and will not be disturbed on appeal unless clearly wrong. An appellate court does not reweigh the evidence but considers the judgment in a light most favorable to the successful party and resolves evidentiary conflicts in favor of the successful party. And that party is entitled to every reasonable inference deducible from the evidence.

8. Judgments: Appeal and Error. An appellate court independently reviews questions of law decided by a lower court.

9. Contracts. Contract interpretation presents a question of law.

10. Contracts: Restitution. When a plaintiff claims that a contract governs the parties' rights and obligations and, alternatively, that it is entitled to restitution under a quasi-contract claim, a court should address the contract claim first.

11. Contracts: Restitution: Unjust Enrichment. Restitution is subordinate to contract as an organizing principle of private relationships, so the terms of an enforceable agreement normally displace any claim of unjust enrichment within their reach.

12. Contracts: Parties: Intent. To create a contract, there must be both an offer and an acceptance; there must also be a meeting of the minds or a binding mutual understanding between the parties to the contract.

13. Contracts: Parties. A binding mutual understanding or meeting of the minds sufficient to establish a contract requires no precise formality or express utterance from the parties about the details of the proposed agreement; it may be implied from the parties' conduct and the surrounding circumstances.

14. Contracts: Parties. Unless the parties have stated otherwise in an express agreement, extrinsic standards can only provide a basis for understanding a contract.

15. Breach of Contract: Parties: Intent. The circumstances must show that the parties manifested an intent to be bound by a contract. Their manifestations are usually too indefinite to form a contract if the essential terms are left open or are so indefinite that a court could not determine whether a breach had occurred or provide a remedy.

16. Contracts: Parties: Intent. If the parties' manifestations or conduct shows that they do not intend to be bound by a contract unless they agree upon the price for services and they fail to agree, there is no contract.

17. Contracts: Proof. The standard of proof for a quasi-contract claim is a preponderance, or proof by the greater weight, of the evidence.

18. Restitution: Unjust Enrichment. To recover under a theory of unjust enrichment, the plaintiff must allege facts that the law of restitution would recognize as unjust enrichment.

19. Unjust Enrichment: Words and Phrases. Unjust enrichment means a transfer of a benefit without adequate legal ground. It results from a transaction that the law treats as ineffective to work a conclusive alteration in ownership rights.

20. Duress. Normally, a plaintiff cannot recover money voluntarily paid under a claim of right to payment if the plaintiff knew of facts that would permit the plaintiff to dispute the claim and withhold payment. But exceptions exist if the plaintiff shows that its consent was imperfectly voluntary, or ineffective, for a legally recognized reason.

21. Unjust Enrichment: Restitution: Duress. Duress is an exception to the voluntary payment rule. If a plaintiff's overpayment to the defendant was induced by duress, the plaintiff can seek restitution to the extent that the defendant was unjustly enriched.

22. Contracts: Parties: Restitution. If one party to a contract demands from the other a performance that is not in fact due by the terms of their agreement, under circumstances making it reasonable to accede to the demand rather than to insist on an immediate test of the dispute obligation, the party on whom the demand is made may render such performance under protest or with reservation of rights, preserving a claim in restitution to recover the value of the benefit conferred in excess of the recipient's contractual entitlement.

23. Duress: Words and Phrases. Duress is coercion that is wrongful as a matter of law. Lawful coercion becomes impermissible when employed to support a bad faith demand: one that the party asserting it knows (or should know) to be unjustified.

24. Breach of Contract: Parties: Duress. Economic duress may be found in threats, or implied threats, to cut off a supply of goods or services when the performing party seeks to take advantage of the circumstances that would be created by its breach of an agreement.

25. Contracts: Duress. To be voidable because of duress, an agreement must not only be obtained by means of pressure brought to bear, but the agreement itself must be unjust, unconscionable, or illegal.

26. Contracts: Duress. The economic duress rules apply to modifications of a contract.

27. Contracts: Duress. Whether a plaintiff voluntarily or involuntarily made a payment under a claim of right is a question of fact.

28. Contracts: Parties: Duress. A weaker party's assent to a unilateral contract modification, which is to that party's disadvantage, should not be implied from its conduct when the weaker party has shown that its assent was obtained through economic duress.

29. Restitution: Unjust Enrichment. The measure of restitution is normally a defendant's unjust gain.

30. Contracts: Courts. A court will not supply a term necessary to create a binding contract. Nor will a court rewrite a contract or speculate as to terms of the contract which the parties have not seen fit to include. It is not the province of a court to rewrite a contract to reflect the court's view of a fair bargain.

31. Contracts. When the parties to a bargain sufficiently defined to be a contract have not agreed with respect to a term which is essential to a determination of their rights and duties, a term which is reasonable in the circumstances is supplied by the court. This rule applies to circumstances showing that the parties to a binding contract have failed to negotiate a term to cover a future contingency.

32. Contracts. A court should not engage in a hypothetical bargaining analysis if applying interpretative principles shows that the parties did not agree on a contract term necessary to determining their rights and duties. In that circumstance, it must supply a term that comports with community standards of fairness and policy.

33. Contracts. Good faith performance excludes an abuse of a power to specify the terms of a contract. Stephen D. Mossman and Patricia L. Vannoy, of Mattson, Ricketts, Davies, Stewart & Calkins, Lincoln, for appellant.

Howard P. Olsen, Jr., and John F. Simmons, of Simmons Olsen Law Firm, P.C., Scottsbluff, for appellee.

HEAVICAN, C.J., CONNOLLY, GERRARD, STEPHAN, McCORMACK, and MILLER–LERMAN, JJ.

CONNOLLY, J.

I. SUMMARY

This dispute is over the rates that the appellant, Waste Connections of Nebraska, Inc. (Waste Connections), charged to dispose of solid waste for the City of Scottsbluff (the City). The parties had two separate contracts. Under the first contract, the City's trucks collected the waste and took it to Waste Connections' transfer station. Waste Connections then hauled the waste to a landfill that it operated. After this contract expired, Waste Connections charged the City $42.50 per ton for temporarily accepting its waste at the transfer station. About a month later, Waste Connections increased the City's rate to $60 per ton.

Under the second contract, Waste Connections performed collection and disposal services for the City and charged the same disposal rate that it charged under the first contract. So after the first contract expired, Waste Collections increased the City's rate to $60 per ton under the second contract.

After a bench trial, the district court entered judgment for the City. This appeal presents several contract, quasi-contract, and restitution issues. We affirm in part, and in part reverse and remand for further proceedings.

II. BACKGROUND

Around 1992, the City closed its landfill. To negotiate better rates for using another landfill site, the City and other western communities formed an interlocal organization called SWAP. SWAP is an acronym for Solid Waste Agency of the Panhandle. In November 1996, SWAP contracted with J Bar J Land, Inc., for solid waste disposal services (the SWAP contract) for 10 years,...