Opinion ID: 774014
Heading Depth: 4
Heading Rank: 1

Heading: Restitution for Landmark's 1982 contribution under the contract

Text: 15 According to the express terms of the Assistance Agreement, Landmark was required to make an initial contribution in the amount of not less than $20,000,000 to the Resulting Association [Dixie] as of the Acquisition Date. To satisfy this requirement, Landmark made an initial contribution of real estate and cash. Landmark presented evidence at trial, which the court found persuasive, indicating that the value of this initial contribution was $21,458,571. 2 The trial court awarded Landmark restitution, and alternatively reliance damages, for the full value of its initial contribution. 16
17 There are two alternative measures of relief in restitution. The first is the value of the benefits received by the defendant due to the plaintiff's performance. The second is the cost of the plaintiff's performance, which includes both the value of the benefits provided to the defendant and the plaintiff's other costs incurred as a result of its performance under the contract. See Acme Process Equip. Co. v. United States, 347 F.2d 509, 530 (Ct. Cl. 1965), rev'd on other grounds, 385 U.S. 138 (1966) (As the best means of restoring the status quo ante, cost of performance is often used.). 18 The government argues on its cross-appeal that the trial court's calculation of the award was improper because it was based upon the value of the benefits that the government received from Landmark's performance under the contract. The government argues that, under Acme, an award against the government can only be based upon the cost of performance standard. We find nothing in Acme to support the government's position, and even assuming, arguendo, that this court's predecessor had so held in Acme, that holding was overruled by Mobil Oil. There, the Court held that the plaintiffs were entitled, under restitution, to repayment of the benefits they conferred upon the government in performance of the contract. Mobil Oil, 530 U.S. at 2438 ([T]he Government must give the companies their money back.). In any event, the government's argument is irrelevant with respect to Landmark's initial contribution because the amount of the award would be identical under either standard. 19
20 The government also argues that any award to Landmark should have been limited to $20 million, as that was the minimum initial contribution that would constitute performance under the contract. The trial court rejected this argument, holding that the terms of the contract are unambiguous in that no ceiling was placed on the initial contribution, but rather it was specified to be not less than $20 million, and that if the parties had intended for performance to be limited to $20 million they would not have included the phrase not less than. Landmark, 46 Fed. Cl. at 266-67. 21 The proper interpretation of a contract is a question of law, which we review de novo. Exxon Mobil Corp. v. United States, 244 F.3d 1341, 1353 (Fed. Cir. 2001). We agree with the court's interpretation of the Assistance Agreement on this point. The Agreement required Landmark to make an initial contribution. Landmark's initial contribution complied with the Agreement's requirement that its value be not less than $20,000,000. Further, there is nothing in the Agreement to indicate any intent of the parties for that portion of the initial contribution beyond $20 million to be deemed anything other than an undivided part of the initial contribution. Because the Agreement's provisions are clear and unambiguous, they must be given their plain and ordinary meaning. Alaska Lumber & Pulp Co., Inc. v. Madigan, 2 F.3d 389, 392 (Fed. Cir. 1993). Thus, the entirety of Landmark's $21.5 million initial contribution constitutes performance under the Agreement, and the trial court properly refused to limit the award to $20 million. 22
23 Because the purpose of restitution is to restore the plaintiff to its status quo ante, the award to the plaintiff must be reduced by the value of any benefits that it received from the defendant under the contract, so that only the actual, or net, loss is compensated. See Restatement (Second) of Contracts §§ 384, cmt. a (A party who seeks restitution of a benefit that he has conferred on the other party is expected to return what he has received from the other party.). The government argues that the trial court erred in refusing to offset Landmark's award by the $26.3 million in dividends that Landmark received from Dixie prior to the government's 1989 breach of the Agreement. The trial court denied offset based upon its factual finding that the government did not establish that any benefits that plaintiffs obtained in the form of dividends from Dixie Savings and Loan can be attributed to the government. Landmark, Order at 1 (April 5, 2000). We afford the trial court's findings of fact considerable deference, disturbing them only if they are shown to have been clearly erroneous. Hendler v. United States, 175 F.3d 1374, 1378 (Fed. Cir. 1999). A finding is 'clearly erroneous' when although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed. United States v. United States Gypsum Co., 333 U.S. 364, 395 (1948). The government has not shown this finding to be clearly erroneous. The government's actions were simply not relevant to the dividends, which were generated as a result of Landmark's performance under the contract in managing Dixie. Thus, because the government was not responsible for the dividends paid by Dixie to Landmark, offset would not be proper. 24
25 Landmark appeals the trial court's denial of award for the use value of the initial contribution from the time of contribution until the government's payment of the judgment. The remedy of restitution may include compensation for lost use value where necessary to restore the plaintiff to its status quo ante by providing compensation for the use of the subject matter for the period during which [it] was deprived. Restatement of Restitution §§ 157(1), cmt. a. The trial court denied Landmark's claim for use value because it found Landmark's evidence unconvincing. Specifically, the trial court stated that: 26 Landmark did not prove that it lost a specific amount of money from not having the use of the property that it contributed to Dixie in 1982. To award damages under Landmark's use value theories, we would be required to engage in a series of speculative assumptions that are not permitted in these circumstances. We could not establish at trial how Landmark would have profited from use of the parcels of real estate that it contributed to Dixie in 1982. Expert testimony that Landmark offered for this purpose was not convincing, and we were left with the need to engage in improper speculation. For this reason, we must deny Landmark recovery for use value. 27 Landmark, 46 Fed. Cl. at 270. Landmark argues on appeal that, because a plaintiff is not required to prove the exact amount of its loss in order to be entitled to compensation, the trial court improperly denied recovery for use value on the ground that Landmark did not prove that it lost a specific amount of money. While it is well settled that recovery cannot be denied on the ground that a non-breaching plaintiff failed to prove the amount of its loss with utter precision, the trial court did not deny recovery solely, if at all, on this basis. As quoted above, the trial court found that Landmark's evidence did not even establish how it would have profited from use of the initial contribution. On appeal, Landmark has failed to point to any evidence to indicate that the court's finding was clearly erroneous. Instead, Landmark argues that the trial court improperly applied the standard of proof for an award of lost profits. However, Landmark has provided no indication of how the use value would have been anything other than the profits that the initial contribution would have generated outside the contract--which the trial court found that Landmark had failed to prove. Thus, Landmark has failed to show that the denial of an award for use value was improper. 28 We hold, therefore, that the trial court's award was sufficient restitution. Thus, we need not consider the trial court's alternative award of the same amount as reliance damages. 29