Commerce Partnership 8098 Ltd. Partnership v. Equity Contracting Co., Inc.

Decision Date26 March 1997
Docket NumberNo. 95-2619,95-2619
Citation695 So.2d 383
Parties22 Fla. L. Weekly D1379, 22 Fla. L. Weekly D764 COMMERCE PARTNERSHIP 8098 LIMITED PARTNERSHIP and Forest-English, Inc., its General Partner, Appellants, v. EQUITY CONTRACTING COMPANY, INC., Appellee.
CourtFlorida District Court of Appeals

GROSS, Judge.

Equity Contracting Company, Inc. ("Equity") filed a one-count complaint against Commerce Partnership 8908 Limited Partnership ("Commerce"). The count was set forth under the heading "Quantum Meruit." The complaint contained the following allegations:

Commerce was the owner of an office building. Commerce contracted with a general contractor, World Properties, Inc., to perform improvements on its property. Equity was the stucco and surfacing subcontractor for the job, having contracted with the general contractor to perform the work. Because it inspected the job on a weekly basis, Commerce was aware of Equity's work. Equity completely performed its subcontract and the reasonable value of its work was $17,100. Commerce failed to pay the general contractor the full amounts due for the job. The general contractor did not pay Equity. Commerce was unjustly enriched because it had accepted Equity's services without paying any entity for them.

In its answer, Commerce asserted that it had paid the general contractor in full.

At the non-jury trial, Equity presented its direct case in under 30 minutes. Equity's president testified that his company had contracted with the general contractor to stucco Commerce's property for $17,100. He indicated that at the start of the job he expected payment only from the general contractor and not from Commerce. Both the general contractor and a representative from Commerce inspected the work as it progressed. After the work was completed, Commerce gave Equity a punch list of remedial work. When Equity's president asked for at least partial payment from Commerce, the latter's representative indicated that "he couldn't do it." Having received no payment, Equity did not complete the punch list. Equity brought suit against the general contractor, who later declared bankruptcy. Equity adduced no evidence regarding Commerce's payments to the general contractor under the construction contract or to any other party for work covered by the contract.

After Equity rested, Commerce moved for an involuntary dismissal, arguing that the evidence did not establish a contract implied in fact. Commerce's attorney contended that the term "quantum meruit" was synonymous with a contract implied in fact. The trial court denied the motion. During closing argument, Equity asserted that it had established a claim for quantum meruit, which it interpreted to mean unjust enrichment. Arguing that a quasi contract claim had first been injected into the case during closing argument, Commerce's attorney obtained permission to reopen his case. By this point in the trial, there was no agreement as to the cause of action at issue or the requirements of proof. The trial judge observed, "[w]e are in equity and I have some difficulty with wondering what the issues are and who is going to prove what."

Commerce's witness testified that the contract price it had negotiated with the general contractor for the improvements was $256,894. He identified three payments totalling $223,065.04 that Commerce made to the general contractor--$173,088.07 in progress payments, $24,976.97 in response to application for payment number 8, and $25,000 in final settlement of the general contractor's lawsuit against Commerce. Commerce also sought to introduce evidence that it had paid $64,097 directly to three subcontractors who had performed work on the building, who were not paid by the general contractor, and who had perfected mechanics' liens. The trial court sustained Equity's objection to this testimony on the ground of relevance.

Relying on Zaleznik v. Gulf Coast Roofing Co., Inc., 576 So.2d 776 (Fla. 2d DCA 1991), the trial court entered judgment in favor of Equity for $17,100.

Contract Implied in Fact and Quasi Contract

This case is a paradigm for the confusion that often surrounds the litigation of implied contracts.

A contract implied in fact is one form of an enforceable contract; it is based on a tacit promise, one that is inferred in whole or in part from the parties' conduct, not solely from their words. 17 Am.Jur.2d "Contracts" § 3 (1964); 1 Arthur Linton Corbin, Corbin on Contracts §§ 1.18-1.20 (Joseph M. Perillo ed. 1993). Where an agreement is arrived at by words, oral or written, the contract is said to be "express." 17 Am.Jur.2d "Contracts" at § 3. A contract implied in fact is not put into promissory words with sufficient clarity, so a fact finder must examine and interpret the parties' conduct to give definition to their unspoken agreement. Id.; 3 Corbin on Contracts § 562 (1960). It is to this process of defining an enforceable agreement that Florida courts have referred when they have indicated that contracts implied in fact "rest upon the assent of the parties." Policastro v. Myers, 420 So.2d 324, 326 (Fla. 4th DCA 1982); Tipper v. Great Lakes Chemical Co., 281 So.2d 10, 13 (Fla.1973). The supreme court described the mechanics of this process in Bromer v. Florida Power & Light Co., 45 So.2d 658, 660 (Fla.1950):

[A] [c]ourt should determine and give to the alleged implied contract "the effect which the parties, as fair and reasonable men, presumably would have agreed upon if, having in mind the possibility of the situation which has arisen, they had contracted expressly thereto." 12 Am.Jur. 766.

See Mecier v. Broadfoot, 584 So.2d 159, 161 (Fla. 1st DCA 1991).

Common examples of contracts implied in fact are where a person performs services at another's request, or "where services are rendered by one person for another without his expressed request, but with his knowledge, and under circumstances" fairly raising the presumption that the parties understood and intended that compensation was to be paid. Lewis v. Meginniss, 30 Fla. 419, 12 So. 19, 21 (1892); Tipper, 281 So.2d at 13. In these circumstances, the law implies the promise to pay a reasonable amount for the services. Lewis, 12 So. at 21; Lamoureux v. Lamoureux, 59 So.2d 9, 12 (Fla.1951); A.J. v. State, 677 So.2d 935, 937 (Fla. 4th DCA 1996); Dean v. Blank, 267 So.2d 670 (Fla. 4th DCA 1972); Solutec Corp. v. Young & Lawrence Assoc., Inc., 243 So.2d 605, 606 (Fla. 4th DCA 1971).

A contract implied in law, or quasi contract, is not based upon the finding, by a process of implication from the facts, of an agreement between the parties. A contract implied in law is a legal fiction, an obligation created by the law without regard to the parties' expression of assent by their words or conduct. 1 Corbin on Contracts § 1.20; Tipper, 281 So.2d at 13. The fiction was adopted to provide a remedy where one party was unjustly enriched, where that party received a benefit under circumstances that made it unjust to retain it without giving compensation. Tipper, 281 So.2d at 13; Variety Children's Hosp. v. Vigliotti, 385 So.2d 1052, 1053 (Fla. 3d DCA 1980).

The elements of a cause of action for a quasi contract are that: (1) the plaintiff has conferred a benefit on the defendant; (2) the defendant has knowledge of the benefit; (3) the defendant has accepted or retained the benefit conferred and (4) the circumstances are such that it would be inequitable for the defendant to retain the benefit without paying fair value for it. Hillman Const. Corp. v. Wainer, 636 So.2d 576, 577 (Fla. 4th DCA 1994); Henry M. Butler, Inc. v. Trizec Properties, Inc., 524 So.2d 710, 711-12 (Fla. 2d DCA 1988). Because the basis for recovery does not turn on the finding of an enforceable agreement, there may be recovery under a contract implied in law even where the parties had no dealings at all with each other. See Variety Children's Hosp., 385 So.2d at 1053. This is unlike a contract implied in fact which must arise from the interaction of the parties or their agents.

To describe the cause of action encompassed by a contract implied in law, Florida courts have synonymously used a number of different terms--"quasi contract," 1 "unjust enrichment," 2 "restitution," 3 "constructive contract," 4 and "quantum meruit." 5 This profusion of terminology has its roots in legal history. Concerned about the confusion between contracts implied in law and fact, two legal scholars sought to "extirpate the term 'contract implied in law' from legal usage and to substitute for it the term 'quasi contract'." 1 Corbin on Contracts § 1.20. As Corbin explains, although the term "quasi contract" took hold, "the older term successfully resisted extirpation to the further confusion of law students and lawyers." Id.

The term "quantum meruit" derives from common law forms of pleading. The action of assumpsit was available for the "recovery of damages for the breach or non-performance of a simple contract ... or upon a contract implied by law from the acts or conduct of the parties." Hazen v. Cobb, 96 Fla. 151, 117 So. 853, 857 (1928). There were two divisions of assumpsit, general, upon the common counts, and special. Id. In general assumpsit, on the common counts, only an implied contract could be the basis of the action. Id. The common counts were "abbreviated and stereotyped statements" that the defendant was indebted to the plaintiff for a variety of commonly recurring reasons, such as goods sold and delivered or work and labor done. 1 Corbin on Contracts § 1.18. The count asking judgment for work done was quantum meruit; for goods sold the count was quantum valebant. Id. The common counts were used to enforce contracts implied both in law and in fact. Because...

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