Case Title: Landeis v. Nelson

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1991-04-09T00:00:00Z

Document:
Landeis v. Nelson1991 WY 43808 P.2d 216Case Number: 90-193Decided: 04/09/1991Supreme Court of Wyoming
Mary LANDEIS; Herman 
Landeis; and Landeis & Associates, Inc., Appellants 
(Defendants),

v.

Leonard P. NELSON, 
Appellee (Plaintiff).

Appeal from the District 
Court, NatronaCounty, Dan Spangler, 
J.

Affirmed.

Thomas, J., issued a specially 
concurring opinion.

David E. 
Westling of Vlastos, Brooks & Henley, P.C., Casper, for appellants.

James H. 
Barrett, Cheyenne, for appellee.

Before 
URBIGKIT, C.J., THOMAS, GOLDEN, JJ., and ROONEY and BROWN, JJ. 
(Retired).

ROONEY, Justice, 
Retired.

[¶1.]     In this appeal from a 
summary judgment entered against them, appellants1 state the issues on appeal: 

     "I. Did the trial 
court err by granting Summary Judgment in a case in which there are genuine 
issues of material fact?

     "II. Did the Supreme 
Court err by granting Summary Judgment that was unsupported by competent 
evidence?"

Appellee 
responds in argument that there was no genuine issue of a material fact and that 
the summary judgment was supported by competent evidence.

[¶2.]     We affirm.

[¶3.]     Appellants had acquired 
the right to sell, in Wyoming, franchise operations known as 
California Nails, a process and marketing strategy for the application of 
artificial fingernails. They sold two of the franchises to appellee: one for 
Cheyenne and one for Laramie. Originally, the 
Cheyenne 
franchise was for appellee and a third person, but a disagreement between the 
two of them resulted in appellee paying for the franchise and taking full 
ownership of it.

[¶4.]     Appellants furnished 
documentation for the Cheyenne franchise but not 
for the Laramie 
franchise. Appellee paid appellants the full purchase price of $30,000 for the 
Laramie franchise, and he instituted this action 
to recover the $30,000, alleging (1) breach of contract by appellants through 
failure to deliver the documentation for the Laramie franchise, and (2) unjust enrichment through their 
acceptance of the $30,000 without delivery of the documentation for the 
Laramie 
franchise.

[¶5.]     Appellants acknowledge 
the foregoing, including the receipt of the $30,000, but they contend on the one 
hand that the preparation of the documentation was appellee's responsibility,2 and on the other hand, that 
documentation was unnecessary and that appellee had the right to operate in 
Laramie without 
any documentation. The fact that documentation was furnished for the Cheyenne franchise 
reflects the intent on the part of the parties to evidence the existence of a 
franchise through documentation.

[¶6.]     Without considering the 
existence or nonexistence of a specific contract and, therefore, whether 
or not the terms thereof have been breached so as to present genuine issues of 
material fact, we note that the trial court disposed of the case on the basis of 
unjust enrichment on the part of appellants.3 The reference by the court to a 
breach of contract is to a breach of the implied contract involved in "unjust 
enrichment."

[¶7.]     We have long recognized 
that an action for money had and received "is an equitable action, and no 
recovery can be had except upon proof that the defendant has received money of 
the plaintiff which, in equity and good conscience, it ought not to retain. That 
is the basis and foundation of the action." Carton v. Board of CountyCommissioners of UintaCounty, 
10 Wyo. 416, 
435, 69 P. 1013 (1902). We have also recognized that an element of fraud or 
tortious conduct on the part of the defendant is not necessary in an action for 
"unjust enrichment."

"[I]f the purpose of 
unjust enrichment is to be served, that when a party receives, with full 
knowledge, materials or services to his benefit from an innocent furnisher of 
such supplies, he should be accountable therefor. The case of Gee v. Eberle, 279 
Pa. Super. 
101, 420 A.2d 1050 (1980), specifically holds that in a claim for unjust 
enrichment, proof of wrongdoing or wrongful intent is unnecessary. That case 
cites with approval the case of Roman Mosaic and Tile Co., Inc. v. Vollrath, 226 
Pa. Super. 215, 313 A.2d 305 (1973), which sets out that to recover on a claim 
of unjust enrichment, it must be shown that the property was wrongfully secured 
or passively received. See also In re Brereton's Estate, 388 Pa. 206, 130 A.2d 453 
(1957)."

Horseshoe 
Estates v. 2M Company, Inc., 713 P.2d 776, 780 (Wyo. 1986).

[¶8.]     The words "unjust 
enrichment" concisely state the necessary elements of an equitable action to 
recover money, property, etc., which "good conscience" demands should be set 
over to the appellee by appellants pursuant to an implied contract between 
them.

"The basis of unjust 
enrichment is that one has funds belonging to another which equity and good 
conscience demand ought to be paid to the other. Restatement, Restitution § 1 
(1937, 1962 Reprint); Cohon v. Oscar L. Paris Company, 17 Ill. App.2d 21, 149 N.E.2d 472 (1958)."

Ward v. First 
Interstate Bank of Riverton, 718 P.2d 886, 889 (Wyo. 1986).

     "`The phrase "unjust 
enrichment" is used in law to characterize the result or effect of a failure to 
make restitution of, or for, property or benefits received under such 
circumstances as to give rise to a legal or equitable obligation to account 
therefor. It is a general principle, underlying various legal doctrines and 
remedies, that one person should not be permitted unjustly to enrich himself at 
the expense of another, but should be required to make restitution of or for 
property or benefits received, retained, or appropriated, where it is just and 
equitable that such restitution be made, and where such action involves no 
violation or frustration of law or opposition to public policy, either directly 
or indirectly.' (Footnotes omitted.) 66 Am.Jur.2d Restitution and Implied 
Contracts § 3, p. 945.

     "For a party to 
successfully assert a quasi contract claim, the showing of an enrichment will 
not in and of itself be sufficient. In order to invoke the remedial powers of a 
court of equity, the underlying circumstances, as between the two parties, must 
be such that the enrichment is unjust. Rocky Mountain Turbines, Inc. v. 660 
Syndicate, Inc., [623 P.2d 758 (Wyo. 1981)]; McGrath v. Hilding, 41 N.Y.2d 625, 394 N.Y.S.2d 603, 363 N.E.2d 328 (1977)."

Bereman v. 
Bereman, 645 P.2d 1155, 1160 (Wyo. 1982). See also Anderson v. Bell, 70 
Wyo. 471, 251 P.2d 572, 577 (Wyo. 1952).

    "Both express contracts and 
contracts implied in fact are based on consent. Evidently, in view of the fact 
that these are the contracts which are usually before the courts, it has been 
said that there is no contract without the consent of the parties. Clearly, 
however, such an observation must have been made without regard to the existence 
of certain legal duties which, though of a contractual nature, are not based on 
consent. These are sometimes spoken of as contracts implied in law, but are more 
properly called quasi-contracts or constructive contracts. They are contracts in 
the sense that they are remediable by the contractual remedy of assumpsit. In 
the case of such contracts, the promise is purely fictitious and is implied in 
order to fit the actual cause of action to the remedy. The liability exists from 
an implication of law that arises from the facts and circumstances independent 
of agreement or presumed intention. The intention of the parties in such case is 
entirely disregarded, while in cases of express contracts and contracts implied 
in fact the intention is of the essence of the transaction. As has been well 
said, in the case of actual contracts the agreement defines the duty, while in 
the case of quasi-contracts the duty defines the contract.

* * * * * *

     "It has been said that 
the doctrines of `unjust enrichment' and `restitution' - modern terms - have 
largely supplanted the former designation of `quasi-contracts.'"

66 Am.Jur.2d, 
Restitution and Implied Contracts, § 2 (1973).

[¶9.]     In this case, 
appellants acknowledge the "enrichment." They state that "there is no conflict 
or dispute." The parties entered into a contract for the purchase of a franchise 
from appellants at the cost of $30,000, which was paid by appellee. Appellants 
argue that the retention of the $30,000 was not "unjust" because they were not 
required to do anything. They contend that it was appellee's obligation to 
prepare the documentation, and they inconsistently contend that documentation 
was unnecessary. The fact that they prepared and delivered documentation for the 
Cheyenne 
franchise discounts both of these contentions. Appellants do not suggest any 
other basis upon which they can retain the $30,000 in good conscience. Its 
retention would be unjust.

[¶10.]  The trial court accurately found that 
appellee "received nothing in return" for the payment of $30,000. Appellants 
were "unjustly enriched." Equity and good conscience require repayment of the 
$30,000 to appellee.

[¶11.]  Affirmed.

FOOTNOTES

1 Appellee's motion 
requested summary judgment "against the defendants." In its decision letter, the 
trial court said in part:

     "Plaintiff has also 
joined Landeis & Associates, Inc., as a party. There is no evidence in the 
record to support a judgment against the corporation. Therefore, the judgment 
will be entered only as to the personal defendants. Mr. Barrett is requested to 
prepare a judgment for the principal amount, prejudgment and post judgment 
interest, and costs for approval as to form by Mr. Westling."

However, the 
judgment recited in part:

     "NOW THEREFORE IT IS 
HEREBY ORDERED that Plaintiff's Motion for Summary Judgment be and the same is 
hereby GRANTED.

     "IT IS FURTHER ORDERED 
that Judgment be and the same is hereby GRANTED in favor of Plaintiff and that 
the Plaintiff is hereby Granted Judgment against the Defendants in the 
principle amount of Thirty Thousand Dollars ($30,000.00) plus prejudgment and 
post-judgment interest." (Emphasis added.)

     The attorneys approved 
it as to form. The notice of appeal named all three appellants, and it was 
processed in all of their names. We conclude that, by their actions subsequent 
to the decision letter, the trial court and the parties consented to deletion of 
that said in the decision letter concerning the exclusion of Landeis & 
Associates, Inc., from the judgment.

2 The record does not 
contain a positive reason for this conflict over the documentation. Appellants 
seemingly could have avoided this lawsuit by simply supplying and executing 
documentation for the Laramie franchise similar 
to that supplied for the Cheyenne franchise. Likewise, appellee 
seemingly could have avoided it by simply preparing documentation for the 
Laramie franchise similar to that supplied for 
the Cheyenne 
franchise and presenting it to appellants for execution.

3 The decision letter 
provided in part:

    "There is no dispute that 
the parties entered into a contract for the purchase by plaintiff of a franchise 
from defendant at a cost of $30,000.00. Plaintiff paid the amount due. 
However, he received nothing in return. Therefore, defendants are in 
breach of the contract and are liable to plaintiff for the amount paid, together 
with interest at the legal rate from the date of payment." (Emphasis 
added.)

THOMAS, Justice, concurring 
specially.

[¶12.]  I agree that the summary judgment in this 
case must be affirmed. I see no need to invoke the doctrine of unjust enrichment 
or the law that supports it. In its decision letter, the district court 
opined:

"There is no dispute that 
the parties entered into a contract for the purchase by plaintiff of a 
franchise from defendant at a cost of $30,000.00. Plaintiff paid the amount due. 
However, he received nothing in return. Therefore, defendants are in breach 
of the contract and are liable to plaintiff for the amount paid, together 
with interest at the legal rate from the date of payment." (Emphasis 
added.)

The trial court 
simply decided a straightforward breach of an express contract case. The 
decision was correct, and it should be affirmed without any reliance upon unjust 
enrichment. The result of the majority opinion seems to suggest that one cannot 
recover damages for breach of contract, but instead must invoke a quasi-contract 
theory. The law justifies recovery of damages for breach of contract, and that 
is what the district court awarded.