Opinion ID: 1175810
Heading Depth: 1
Heading Rank: 3

Heading: formula for recovery on quantum meruit.

Text: Pellandini argues strongly that the formula given by the trial court to the jury for a quantum meruit recovery was incorrect. Pellandini contends that the measure of reasonable value is to be applied to the benefit done for the recipient, here Pellandini, and that the instruction which was given allowed the jury to let JNP recover the reasonable value of what it did, regardless of benefit to Pellandini. In support of this contention Pellandini quotes this excerpt from 66 Am.Jur.2d, Restitution and Implied Contracts, § 28 at 973: The measure of recovery for services furnished or goods received under the doctrine of unjust enrichment, as distinguished from the doctrine of contracts implied in fact, is the value of the actual benefit realized and retained. (Emphasis added) Following this excerpt, and omitted in the Pellandini brief, the text goes on to add: If there is no special agreement as to the amount of compensation and the services are not intended to be gratuitous, the law implies a promise by the employer to pay what services reasonably are worth, which is determined largely by the nature of the work and the customary rate of pay for such work in the community and at the time the work was performed. These are matters for the jury to determine, under proper evidence and instructions. (Emphasis added) Pellandini further quotes an excerpt from an editorial comment found in the Restatement of the Law on Restitution, § 107 at 449 (1936). The excerpt points to a distinction between an action based upon a promise, whether it be express or implied in fact, and an action based upon unjust enrichment. While Pellandini cites the excerpt as support for their contention that the measure of recovery should have been predicated on value of benefit to recipient, they seemingly ignore the proposition that the relief allowed here was not in restitution, but in quantum meruit, predicated upon the implied in fact promise to pay which the law supplies from the conduct of the parties. The actual statement of the law at page 448, being subsection (2) of § 107 is: In the absence of circumstances indicating otherwise, it is inferred that a person who requests another to perform services for him or to transfer property to him thereby bargains to pay therefor. The excerpt relied upon by Pellandini is a comment to subsection (1) of § 107 and not pertinent to the issue here. Comment to subsection (2) of § 107 is helpful, which reads in part as applicable: ... [T]he conduct and words of the parties are interpreted in the light of ordinary usages and it is the ordinary understanding that a person who asks another to do something for him or to transfer something to him will pay for it unless the circumstances under which the request is made indicate otherwise. Pellandini, in excerpting a quote in Williston on Contracts, from the case of Gillis v. Cobe, 177 Mass. 584, 59 N.E. 455 (1901), further urge their contention that actual benefit to the recipient is the proper measure. Unfortunately, neither the case nor Williston support Pellandini. The case and section of Williston relied upon are concerned with those situations where there is a contract, but such a failure upon the part of the plaintiff to perform that, contractually, ... he is entirely out of court, yet it is not fair that the defendant should go out of the transaction as a whole with a profit at his, the plaintiffs' expense ... 12 Williston on Contracts, § 1482 at 296-297 (3rd Ed. Jaeger 1970). The measure of recovery in quantum meruit is not discussed. To enlighten we call attention to Nelson v. Hazel, 91 Idaho 850, 433 P.2d 120 (1967), which was an unjust enrichment building contract case brought by a negligent builder. The legal propositions urged by Pellandini are appropriate to, and were applied in that case, but are not applicable here, where the jury did not find the agreement to have been made as contended by Pellandini, nor breached by JNP. It may also be helpful to point to a statement in 12 Williston on Contracts, § 1480 at 280-282, where the text speaks of the confusion between quasi-contractual obligations and actual contracts. The text is in accord with the definitions of this Court in Continental Forest, supra, set forth above, and speaks of actual contracts as being, ... those where there is a real promise, whether express or implied in fact, to pay the reasonable value of goods or services. In such cases and on a fair interpretation of the parties' contract, if there is a market value for what the plaintiff is requested to furnish, that value is the measure of the promised price; if there is no market price, the measure is at least the cost or worth from the plaintiff's standpoint, not limited by the fact that the value of the benefit which accrues to the defendant, is a less sum.  (Emphasis added) In 66 Am.Jur.2d, Restitution and Implied Contracts, § 166 at 1096, it is similarly stated, as to quantum meruit, that the measure of recovery is the reasonable value of the goods or services furnished to the benefited defendant. This Court in its consideration of Pellandini's argument on this issue must address itself to a statement in a recent opinion of ours, which, while not cited by either party, at first blush seems to support Pellandini's position. In Dale's Service Company, Inc. v. Jones, 96 Idaho 662, 666, 534 P.2d 1102, 1106 (1975), it was stated that: Under a quantum meruit theory, the proper measure for recovery is the value of the actual benefit realized and retained by the recipient of the services and material. (Emphasis added) Closer inspection of the authority relied upon by the Court in enunciating that standard reveals that this statement was an incorrect pronouncement of the law. In Fairchild v. Mathews, 91 Idaho 1, 415 P.2d 43 (1966), relied upon by this Court as authority for the above quoted proposition, the trial court had determined that there was no meeting of the minds of the contesting parties concerning the price to be paid for land leveling work. It therefore held the working claimant was entitled to receive the reasonable value of his services performed. The reasonable value was arrived at on the basis of the uncontradicted testimony of a disinterested third party, qualified in the field, who testified as to the reasonable hourly rate for the labor provided. In affirming, this Court stated, specifically not making value of benefit to the recipient the criteria: The lower court therefore had no alternative except to resolve this issue on the basis of quantum meruit, i.e., to allow the respondent the reasonable value of services performed upon appellant's land to appellant's benefit. Id. at 5, 415 P.2d at 47. In Weber v. Eastern Idaho Packing Corporation, 94 Idaho 694, 496 P.2d 693 (1972), also cited as supporting authority in Dale's Service, supra, this Court commented: The facts of this case fit within the decisions of Fairchild v. Mathews, 91 Idaho 1, 415 P.2d 43 (1966) and Guyman v. Anderson, 75 Idaho 294, 271 P.2d 1020 (1954), where this Court allowed lien claimants to recover on the theory of quantum meruit for land leveling. The former case also concerned the failure of the parties to agree on the price to be paid for land leveling work and held that the district court properly resolved the dispute by allowing the workman to recover the reasonable value of his services performed on the defendant's land which were to defendant's benefit. In that case as in the present record, there was uncontroverted testimony from an impartial witness familiar with leveling work describing the prevailing rates charged for similar work. In the present case, the rates charged by respondents were at the lower end of the rate scale for the area. Id. at 697, 496 P.2d at 696. Again, the value of the benefit to the recipient of the services was not made the determinative factor in the recovery on a quantum meruit claim. Prior to Dale's Service it is clear that Idaho was in accord with the majority rule; i.e., the measure of recovery on quantum meruit is the reasonable value of the service rendered to the benefited defendant, and not the value of the actual benefit realized and retained by the recipient. The above-quoted statement in Dale's Service was an inadvertence occasioned by the very confusion mentioned in Williston, and a momentary failure to distinguish quantum meruit recovery from recovery under theories of unjust enrichment, quasi-contractual, and implied-in-law. Accordingly, we now disavow it as an incorrect statement of the law, recognizing however, that it may have application in some types of quasi-contractual, unjust enrichment cases. As thus viewed, it is noted that the trial court's instruction advised the jury that the services and material had to be received by Pellandini, provided by JNP, and the measure of any recovery would be determined as the reasonable value of what JNP rendered. There is no disputing that JNP did care for and feed Pellandini's calves for approximately 60 days. Both parties were given ample opportunity to present evidence touching on that issue.