LeMaster Construction, Inc. v. Mahoney, No. A06-1208 (Minn. App. 6/5/2007), A06-1208.
| Decision Date | 05 June 2007 |
| Docket Number | No. A06-1208.,No. A06-1202.,A06-1208.,A06-1202. |
| Parties | LeMaster Construction, Inc., Respondent (A06-1202), Appellant (A06-1208), v. Seamus Mahoney, Appellant (A06-1202), Respondent (A06-1208), First Franklin Financial Corporation, Defendant, John Doe and Mary Roe, whose names are unknown to the plaintiff, Defendants. |
| Court | Minnesota Court of Appeals |
Appeal from the District Court, Ramsey County, File No. C6-04-3199.
Mark E. Fuller, Mark Fuller & Associates, Ltd., (for respondent LeMaster Construction)
Jennifer M. Macaulay, Macaulay Law Offices, (for appellant Mahoney)
Considered and decided by Ross, Presiding Judge; Kalitowski, Judge; and Halbrooks, Judge.
UNPUBLISHED OPINION
In this consolidated appeal from the district court's judgment in a mechanic's-lien foreclosure matter, appellant Seamus Mahoney argues that the district court erred by disregarding the statutory mechanic's-lien provisions and by failing to strictly construe the prelien-notice requirements in determining damages. As a result of these errors, appellant contends that the attorney-fees award must be vacated. Respondent LeMaster Construction, Inc. argues that the district court erred in its determination that there was no contract between the parties, instead awarding damages on a quantum meruit basis, and that the district court abused its discretion by awarding only a portion of the attorney fees it requested. We affirm.
Following a fire at his home on September 12, 2003, appellant Mahoney was referred by his insurance agent to respondent LeMaster Construction, Inc., a company that specializes in fire and water remediation. Verdean LeMaster, the company owner, and Mahoney met that night, and LeMaster secured the home by boarding it up. The parties dispute whether LeMaster gave Mahoney a copy of the company's standard remediation agreement on September 12, 2003. But it is undisputed that Mahoney signed the agreement on September 26, 2003. The agreement provided, in part, that
Contractor is hereby authorized to complete all of the work, including, but not limited to, restorations, cleaning, repairing, removal, storage, testing, damage appraisal and return of the inventories personal property ("Contents") and all repairs to the building ("Structure") relating to the insurance claim for fire damage to contents and structure ("Loss") at the following location . . . ("Property"). Contractor shall repair the property for amount to be determined later between adjuster and contractor. Owner responsible for deductible and upgrades.
The agreement also contained the mechanics' prelien notice required by Minn. Stat. § 514.011 (2006) and provided for liquidated damages in the event of breach by the homeowner; 8% per annum interest on any unpaid balance; and costs, disbursements, and attorney fees in the event of litigation. Removal of Mahoney's personal property from the home commenced on September 16, 2003, and demolition started on October 7, 2003. LeMaster and Mahoney's insurance adjuster communicated about the scope of the work to be paid by the insurer for the remediation. On October 23, 2003, the adjuster met with Mahoney and LeMaster to review the scope of the project, the total cost of which was $58,256.39. It was also agreed that LeMaster would be paid for removing, cleaning, and storing Mahoney's personal property.
At some point after LeMaster had begun its work, Mahoney orally requested some additions or upgrades to the work that had been approved by his insurance company. On November 5, 2003, and November 11, 2003, LeMaster faxed change orders to Mahoney that reflected the proposed changes. Signed orders were never returned. As a result, on approximately November 19, 2003, LeMaster ceased work on the project. By that time, LeMaster claims that it had completed $15,060.14 of work on the restoration and $7,466.67 of work related to change orders and incurred $ 16,509 to remove, clean, and store Mahoney's personal property. While Mahoney's insurer ultimately paid him $58,256.39 for structural repairs and $16,509 for personal-property treatment, Mahoney has not paid anything to LeMaster.
LeMaster initiated a mechanics'-lien foreclosure action by leaving a mechanics'-lien statement at Mahoney's home with his girlfriend. Pursuant to the terms of the agreement that Mahoney signed on September 26, 2003, LeMaster claimed total damages of $85,307.88. Mahoney testified that he received the statement later that day. LeMaster subsequently filed a summons and complaint, seeking damages for mechanics'-lien foreclosure, breach of contract, and unjust enrichment.
The matter was tried to the district court. The district court determined that there was no valid contract because, although the amount that the insurance company agreed to pay Mahoney was established on October 23, 2003, the parties had not agreed to the essential terms of the work that Mahoney wanted LeMaster to complete and the price of that work versus what Mahoney would do himself. But the district court found that because LeMaster had completed work that was of value to Mahoney, LeMaster was entitled to quantum meruit damages. The district court, therefore, awarded LeMaster a total of $22,526.81—$15,060.14 for the completed demolition and restoration work and $7,466.67 for work done pursuant to change orders. In response to Mahoney's challenge to the validity of the statutory prelien notice, the district court concluded that the mechanics' lien was perfected for the structural work done by LeMaster after September 16, 2003. With respect to LeMaster's claim for expenses related to Mahoney's personal property, the district court determined that there was no perfected, separate lien and no contractual basis for recovery, but awarded $9,649.99 in quantum meruit damages to LeMaster for "contents processing" up until December 30, 2003. Finding no contractual basis to award attorney fees, the district court awarded $10,000 to LeMaster as reasonable attorney fees pursuant to the mechanics'-lien statute. Mahoney's counterclaims for conversion, substandard work, and attorney fees were denied. Posttrial, the parties stipulated to some additional mechanics'-lien language in the district court's order. But all other posttrial motions were denied by the district court. This consolidated appeal follows.
We first examine whether the district court erred in its determination that there was no contract between the parties. Whether a contract exists is generally an issue for the fact-finder that will be overturned only if "manifestly contrary to the evidence." Morrisette v. Harrison Int'l Corp., 486 N.W.2d 424, 427 (Minn. 1992). "Findings of fact, whether based on oral or documentary evidence, shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the [district] court to judge the credibility of the witnesses." Minn. R. Civ. P. 52.01. "Findings of fact are clearly erroneous only if the reviewing court is left with the definite and firm conviction that a mistake has been made." Fletcher v. St. Paul Pioneer Press, 589 N.W.2d 96, 101 (Minn. 1999) (quotation omitted).
Contract formation requires mutual assent. Field-Martin Co. v. Fruen Milling Co., 210 Minn. 388, 389, 298 N.W. 574, 575 (1941). Formation is determined through an objective test, "judged by the words and actions of the parties and not by their subjective mental intent." Hill v. Okay Constr. Co.,312 Minn. 324, 332, 252 N.W.2d 107, 114 (1977). This intent "may be inferred wholly or partly from words spoken or written or from the conduct of the parties or a combination thereof." Cederstrand v. Lutheran Bhd., 263 Minn. 520, 532, 117 N.W.2d 213, 221 (1962).
"[T]he law does not favor the destruction of contracts because of indefiniteness, and if the terms can be reasonably ascertained in a manner prescribed in the writing, the contract will be enforced." King v. Dalton Motors, Inc., 260 Minn. 124, 126, 109 N.W.2d 51, 53 (1961) (footnote omitted). But a contract is void if it is so vague, indefinite, or uncertain that the contract's meaning and the parties' intent is left to speculation. Id. at 126, 109 N.W.2d at 52. Therefore, a "purported contract is fatally defective" if it contains "substantial and necessary terms . . . specifically left open for future negotiation." Id.; see also Triple B & G, Inc. v. City of Fairmont, 494 N.W.2d 49, 53 (Minn. App. 1992) (). "When the parties know that an essential term of their intended transaction has not yet been agreed upon, there is no contract." Malevich v. Hakola, 278 N.W.2d 541, 544 (Minn. 1979).
Here, the district court determined that the essential terms of the contract were never fully settled. And, in fact, the document that Mahoney signed on September 26 stated that "the scope of the work shall be as authorized by [Mahoney's] insurance company and agreed to by [Mahoney] and [LeMaster], all as more specifically set forth in attached Exhibit `A'." But "Exhibit `A'" was not attached. Although the parties had some agreement on the general nature and scope of the work, the specific terms were never committed to writing. The insurance adjuster testified that Mahoney and LeMaster were still discussing the scope of the work to be done when he left the October 23, 2003 meeting. At that time, Mahoney was considering new work on his basement and less work upstairs. As the district court found, this gap in the agreement left terms open for future negotiation. Thus, we agree that a contract was never formed.
But because the district court found that Mahoney received a benefit from LeMaster's work, the district court awarded LeMaster quantum meruit damages of $15,060.14 for demolition...
To continue reading
Request your trial