Opinion ID: 1692119
Heading Depth: 2
Heading Rank: 2

Heading: Claims Arising Out of Mallory's Practicing Law at Mantiply & Associates

Text: Mallory alleges that he was paid only $10,300 by Mary Elizabeth during the 17 months he practiced law at Mantiply & Associates. He contends that Mary Elizabeth failed to compensate him for the reasonable value of his work and he requested an accounting or, in the alternative, a judgment under a quantum meruit theory for the value of the work he performed. [6] Recovery on a theory of quantum meruit arises when a contract is implied. Brannan & Guy, P.C. v. City of Montgomery, 828 So.2d 914 (Ala.2002). There are two kinds of implied contracts  those implied in fact and those implied in law. Contracts implied in law are more properly described as quasi or constructive contracts where the law fictitiously supplies the promise [to pay for the labor or services of another] to prevent a manifest injustice or unjust enrichment, etc. Green v. Hospital Bldg. Auth. of Bessemer, 294 Ala. 467, 470, 318 So.2d 701, 704 (1975). This Court has stated: It is the settled law of this State that where one knowingly accepts services rendered by another, and the benefit and the result thereof, the law implies a promise on the part of the one accepting with knowledge the services rendered by another to pay the reasonable value of such services rendered. Hendrix, Mohr & Yardley, Inc. v. City of Daphne, 359 So.2d 792, 795 (Ala.1978). In order to succeed on a claim based on a theory of quantum meruit, the plaintiff must show that it had a reasonable expectation of compensation for its services. Utah Foam Prods., Inc. v. Polytec, Inc., 584 So.2d 1345 (Ala.1991). However, [w]hen an express contract exists, an argument based on a quantum meruit recovery in regard to an implied contract fails. Brannan & Guy, 828 So.2d at 921. The existence of an express contract on a given subject generally excludes an implied agreement on the same subject. Vardaman v. Florence City Bd. of Educ., 544 So.2d 962 (Ala.1989). The parties' agreement that Mallory would come to work at Mantiply & Associates, that Mary Elizabeth would continue to control the firm's money, and that Mallory would be treated fairly is so vague as to be tantamount to no agreement at all. The agreement contains no identifiable and enforceable measure of a term essential to the agreement  Mallory's compensation. We note that no contract, whether express or implied-in-fact, is formed without an offer, an acceptance, consideration, and mutual assent to terms essential to the contract. Steiger v. Huntsville City Bd. of Educ., 653 So.2d 975, 978 (Ala.1995). Because no express contract or contract implied-in-fact exists between the parties, in order for Mallory to prevail on his claim based on quantum meruit he must establish that Mary Elizabeth knowingly accepted his services and that he had a reasonable expectation of being compensated for his services. The evidence viewed in a light most favorable to Mallory indicates that Mary Elizabeth asked Mallory in November 2001 to come to work at Mantiply & Associates. Mallory worked long hours while he was working at Mantiply & Associates; Mary Elizabeth rarely came to the office. Mary Elizabeth's practice had sustained a net loss of approximately $30,719 from January 2000 through November 2001. During the 17 months Mallory practiced law at Mantiply & Associates the practice showed a net profit of approximately $164,544. However, despite turning the practice to profitability, Mallory was paid only $10,300 by Mary Elizabeth during the 17 months he practiced at Mantiply & Associates. There is a factual question as to whether Mary Elizabeth knowingly accepted the benefit of Mallory's services and whether Mallory had an expectation of being compensated for the reasonable value of his services. Accordingly, we conclude that Mallory has established a prima facie case as to his claim based on quantum meruit. However, Mary Elizabeth argues that Mallory's claim seeking recovery under a theory of quantum meruit and arising out of his practice of law at Mantiply & Associates must fail because, she says, he has violated the clean hands doctrine. This Court has stated: `This Court has recognized that one who seek[s] equity must do equity and one that comes into equity must come with clean hands. The purpose of the clean hands doctrine is to prevent a party from asserting his, her, or its rights under the law when that party's own wrongful conduct renders the assertion of such legal rights contrary to equity and good conscience.' Neal v. Neal, 856 So.2d 766, 786 (Ala.2002) (quoting J & M Bail Bonding Co. v. Hayes, 748 So.2d 198, 199 (Ala.1999)). Mary Elizabeth argues that Mallory violated the clean hands doctrine by covertly opening a bank account at AmSouth Bank in the name of Mantiply & Associates and by depositing into that account checks made payable to Mantiply & Associates. She also contends that Mallory violated the clean hands doctrine by diverting clients from Mantiply & Associates by the use of the fee agreements executed in his name rather than in the name of Mantiply & Associates, by redirecting the Best Talk telephone number to the telephone at his new law office, and by taking files belonging to Mantiply & Associates when he left Mantiply & Associates. A detailed statement of the evidence bearing on these issues is set out above and need not be repeated. The evidence viewed in a light most favorable to Mallory indicates that questions of fact exist as to whether Mallory violated the clean hands doctrine so as to preclude his quantum meruit recovery. Accordingly, we conclude that the trial court erred in entering a summary judgment in favor of Mary Elizabeth on Mallory's claim, based on a theory of quantum meruit, arising out of the practice of law at Mantiply & Associates. We therefore reverse the summary judgment as to that claim.
Mallory next argues that Mary Elizabeth made certain fraudulent representations to him that induced him to practice law at Mantiply & Associates. Mallory's argument in support of this claim consists of one page and cites no authority. Mallory has again failed to comply with the minimum requirements of Rule 28, Ala. R.App. P.; therefore, we affirm the judgment of the trial court as to this issue. Spradlin, supra . Even assuming, however, that Mallory had satisfied the requirements of Rule 28 as to this claim, his claim would still fail. Mallory could not have reasonably relied on the representations allegedly made by Mary Elizabeth. An essential element of any fraud claim is reasonable reliance. See Reynolds Metals Co. v. Hill, 825 So.2d 100, 105 (Ala.2002). Mallory contends that Mary Elizabeth made representations concerning the nature and profitability of her various business ventures and her financial ability to fund a law practice. However, these representations were made by Mary Elizabeth to Mallory after Mary Elizabeth had borrowed approximately $164,000 from Mallory and Mallory had assumed the mortgage on the Neumann Drive property. Additionally, Mallory testified that Mary Elizabeth was going to have to pawn her automobile if he did not lend her money on one occasion; that Mary Elizabeth's living expenses were exorbitant; and that her law practice was dead when he started working at Mantiply & Associates. Accordingly, we conclude that Mallory could not have reasonably relied on any representations as to Mary Elizabeth's ability to finance a law practice.