Guldberg v. Greenfield

• Decision Date: 15 November 1966
• Docket Number: No. 52135,52135
• Citation: 146 N.W.2d 298,259 Iowa 873
• Parties: Donald GULDBERG, d/b/a Hampton Heating, Appellee, v. Morris GREENFIELD and Orah A. Greenfield, Appellants.
• Court: Iowa Supreme Court

Page 298

146 N.W.2d 298

259 Iowa 873

Donald GULDBERG, d/b/a Hampton Heating, Appellee, v. Morris GREENFIELD and Orah A. Greenfield, Appellants.

No. 52135.

Supreme Court of Iowa.

Nov. 15, 1966.

Lundy, Butler, Wilson & Hall, Eldora, for appellants.

Whitesell Law Firm, Iowa Falls, for appellee.

GARFIELD, Chief Justice.

We think the principal question this appeal presents is whether a subcontractor who fails to file his mechanic's lien and bring action to enforce it within the times required by sections 572.9 and 572.27, Codes, 1962, 1966, may recover a personal judgment against the owners, secured by an equitable lien against the property, on a theory of implied contract or unjust enrichment. We hold this may not be done under the record we have here.

Plaintiff is engaged in the plumbing, heating and eave trough business in Hampton. Defendants are husband and wife who owned a lot there on which they planned to build a home. On September 29, 1961, they entered into a written contract with A. E. Clouse of Mason City as contractor to construct the home for $21,471. In early October plaintiff was engaged to install the heating, plumbing and eave troughs under circumstances we will later relate and did as he agreed. Clouse, the principal contractor, got into financial difficulty, did not complete the home, his construction business was dissolved, he moved to California and later took bankruptcy.

On April 25, 1962, plaintiff as subcontractor filed his sworn mechanic's lien prepared by his attorneys, for his total claim of $3272.47 stating that the items on which it is based were furnished between October 11, 1961, and January 24, 1962. The statement was of course not filed within 60 days after the last material was furnished and labor performed as required by Code section 572.9. Nor was action brought to enforce the lien within two years from the expiration of the 60 days as section 572.27 requires.

On October 1, 1964, plaintiff filed his petition in three counts against defendants Greenfield and wife. Count I is based on an alleged oral contract between plaintiff, defendants and Clouse and avers that defendants (Greenfields) agreed to pay for the labor and materials plaintiff furnished 'at the prices specified and hereinafter set forth.' A copy of the statement (Exhibit A) attached to the mechanic's lien was made part of the petition which alleges it is a true account of the labor, materials and contract price.

Count II of plaintiff's petition is based on the claim defendant husband induced plaintiff to sell to Clouse the materials listed in Exhibit A by fraudulent representation to him on or about October 11, 1961, that Clouse was solvent and in good credit when in fact he was then insolvent. No evidence was offered in support of Count II and nothing is claimed for it here.

After Count III of the petition was twice amended it was stricken and two substitute Counts III were later filed, the last of which was again amended by striking therefrom the allegation that plaintiff placed the improvements upon the real estate at the oral instance and request of defendants. As finally amended Count III alleges that between October 11, 1961 and January 24, 1962, plaintiff placed the improvements upon defendants' real estate as shown by the statement Exhibit A, the improvements were accepted by and beneficial to defendants, the fair and reasonable price of the labor and materials furnished is $3272.47, no part of which has been paid, defendants are unjustly enriched by retaining the materials and labor and should make restitution to plaintiff for the amount claimed.

Each count asks judgment for $3272.47 with interest and costs. The prayers were amended to ask that the described real estate be subjected to the judgment.

Defendants' answer is a denial of the allegations of the petition and an allegation that any contract plaintiff had for furnishing materials and labor for their dwelling was with Clouse, the principal contractor, not with defendants; defendants have paid Clouse all amounts due him and their enjoyment of the materials and labor furnished by plaintiff is not unjust.

Following trial the court found the reasonable value of the materials and labor plaintiff furnished is $3272.47; the primary fact question is whether plaintiff dealt with defendants as contractor or subcontractor; plaintiff and defendant husband were acquainted prior to the time in question; plaintiff did not previously know Clouse; defendant Greenfield did the talking on the first contact between him, Clouse and plaintiff, and called plaintiff to the job on the first two occasions; the two defendants discussed the changes in what plaintiff was to do 'and cannot now hide under the subterfuge of an alleged contract between plaintiff and Clouse; the contract for the plumbing, heating and spouting was between plaintiff and defendants and defendants are liable to plaintiff for the reasonable value thereof.'

As conclusions of law the trial court held Count I seeks to recover on a contract implied in fact and Count III on a theory of unjust enrichment; the burden of proof on Count I was upon plaintiff; defendants knew of the estimate plaintiff gave Clouse and assented to the existence of the contract between them; even without the assent of defendants a quasi-contractual obligation would be imposed upon them by law to bring about justice, without regard to the intention of the parties; there was no express contract between the parties in question; plaintiff has an equitable lien on the real estate for the amount of his claim; having found for plaintiff on Count I, Counts II and III which seek the same relief were dismissed.

Defendants' counterclaim for alleged slander of title was dismissed on the ground plaintiff did not act maliciously in representing to a prospective purchaser of the property that plaintiff had a lien on it and in procuring the clerk of the district court to enter the present case in his lis pendens docket.

I. Since this is an equity action our review is de novo. Code section 624.4; Rule 334, Rules of Civil Procedure. Especially when considering the credibility of witnesses we give weight to the fact findings of the trial court but are not bound by them. Authorities need not be cited for this nor for the proposition, recognized by the trial court, that plaintiff had the burden to prove by a preponderance of the evidence the causes of action he pleaded. Rule 344(f) 5, 6, and 7, R.C.P.

II. We think plaintiff's Count I declares upon an express oral contract, not on a contract implied in fact, with defendants and Clouse under which plaintiff agreed to furnish the labor and material in question; that subsequently defendants 'did agree to pay therefor at the price specified and hereinafter set forth; plaintiff completed said contract * * * and has performed all conditions and agreements thereof; and true account of the labor and materials furnished * * * under said contract and of the contract price is attached hereto marked Exhibit A * * *.'

There is no claim plaintiff proved an express oral contract under which defendants agreed to pay him for the labor and material at the contract price. As stated, the trial court found there was no express contract between the parties but that plaintiff was entitled to recover on a contract implied in fact and, even without the assent of defendants necessary for such an implied contract, a quasi-contractual obligation would be imposed on defendants, evidently under Count III although it was dismissed.

A contract is express when the parties show their assent in words. A contract is implied in fact, commonly called an implied contract, when the parties show their assent by acts. A quasi contract or contract implied in law rests upon the equitable principle that one shall not be permitted to unjustly enrich himself at the expense of another or to receive property or benefits without making compensation therefor. See City of Pella v. Fowler, 215 Iowa 90, 96, 244 N.W. 734, 737, and citations; Cassaday v. DeJarnette, 251 Iowa 391, 397, 101 N.W.2d 21, 25; Smith v. Stowell, 256 Iowa 165, 173, 174, 125 N.W.2d 795; 17 Am.Jur.2d, Contracts, section 3.

We have held many times that one who pleads an express oral contract cannot ordinarily recover upon an implied contract or quantum meruit. Maasdam v. Estate of Maasdam, 237 Iowa 877, 884, 24 N.W.2d 316, 320, and citations; Lautenbach v. Meredith, 240 Iowa 166, 168, 35 N.W.2d 870, 871; In re Trust of Spilka, 250 Iowa 1021, 1027, 97 N.W.2d 625, 628; Christensen v. Iowa State Highway Comm., 252 Iowa 1351, 1353, 110 N.W.2d 573, 575. See also Usgaard v. Silver Crest Golf Club, 256 Iowa 453, 455, 27 N.W.2d 636, 637; 17 A C.J.S. Contracts § 569a, pages 1095, 1096. This rule applies here to plaintiff's right to recover from defendants under Count I. We will later consider plaintiff's right to recover under Count III on a theory of unjust enrichment.

III. We are not content to rest our holding as to Count I on the proposition plaintiff did not plead an implied contract with defendants. We think the proof does not support recovery on the theory of implied contract with them. It is clear there would be no such implied contract if plaintiff's contract was with Clouse as principal contractor and plaintiff furnished the material and labor as a subcontractor under him.

The written contract between defendants and Clouse required him to furnish the gutters and downspouts, plumbing and heating. Clouse had obtained a bid on these items from someone in Mason City engaged in such work. (Clouse lived in Mason City.) Greenfield suggested to Clouse he might want a bid from plaintiff. Accordingly these two went to plaintiff's shop in Hampton. Only Mrs. Guldberg was there. She testified Greenfield introduced her to Clouse as the contractor who would build defendants' new home. She wrote down some preliminary information regarding the plumbing and heating and asked...