Court Opinion

ID: 9739761
Source: CourtListenerOpinion
Date Created: 2023-08-26 20:20:31.706197+00
Date Added: 2024-06-11T07:24:09.122024
License: Public Domain

Cavanagh, C.J.
(concurring in part and dissenting in part). I concur with the majority’s conclusion that the trial court properly granted summary disposition with regard to the third-party beneficiary count. I write separately, however, because I dissent from the majority’s holding that the public works act1 imposes upon a contracting governmental unit the duty to verify the validity of payment bonds. Furthermore, I would hold that the trial judge properly granted the defendant’s motion for summary disposition with regard to the plaintiff’s negligence, unjust enrichment, and constructive trust claims.
I
The majority’s holding is contrary to the history of the public works act, the clear and unambiguous directives of the entire act, as well as federal case law interpreting similar legislation.
*192A
An early version of the public works act explicitly imposed a duty on a contracting governmental unit to require payment bonds:
When public buildings or other public works are about to be built, repaired or ornamented under contract at the expense of the State, or of any county, city, village, township or school district thereof, it shall be the duty of the board of officers or agents, contracting on behalf of the State, county, city, village, township or school district, to require sufficient security by bond for the payment by the contractor of all subcontractors and for the payment for all labor performed and materials furnished in the erection, repairing or ornamenting of such building or works. [1905 PA 187, § 1, MCL 570.101; MSA 26.321. Emphasis added.]
Accordingly, this Court held that a governmental unit is liable to subcontractors for damages incurred because of the government’s failure to require a payment bond for a public project. "[A] total failure to require such bond is such a breach of duty as authorizes an action by the party injured against members of the board or municipal body in their individual capacity.” Alpena v Title Guaranty & Surety Co, 158 Mich 678, 680; 123 NW 536 (1909). Smith v Hubbel, 142 Mich 637, 644-645; 106 NW 547 (1906).2
The statute, as presently enacted, however, does not impose a duty on a governmental unit:_
*193Before any contract, exceeding $50,000.00 for the construction, alteration, or repair of any public building or public work or improvement of the state or a county, city, village, township, school district, public educational institution, other political subdivision, public authority, or public agency hereinafter referred to as the "governmental unit,” is awarded, the proposed contractor, hereinafter referred to as the "principal contractor,” shall furnish at his or her own cost to the governmental unit a performance bond and a payment bond which shall become binding upon the award of the contract to the principal contractor. . . . [MCL 129.201; MSA 5.2321(1). Emphasis added.]
If the Legislature had not been concerned with alleviating the statutory duty imposed on a governmental unit contracting for a public project, then there would have been no need to remove the words imposing such a duty. While we are not privy to the Legislature’s reasons for excluding the language that imposed the duty, such a change facilitates the public policy favoring individual involvement in public service, while simultaneously providing a remedy for unpaid subcontractors.3 Regardless of the Legislature’s motives, the clear effect of the change is apparent:
[T]he mere fact that the legislature enacts an amendment indicates that it thereby intended to change the original act by creating a new right or withdrawing an existing one. Therefore, any material change in the language of the original act is presumed to indicate a change in legal rights. . . . This is a rule peculiar to amendments and other *194acts purporting to change the existing statutory law. [1A Sands, Sutherland Statutory Construction (4th ed), § 22.30, p 265.][4]
It is obvious that the Legislature was aware of the explicit statutory duty imposed on a governmental unit contracting for the construction or improvement of a public project. It is equally apparent that the Legislature was aware of this Court’s line of cases imposing the statutory mandate. Armed with this knowledge, the Legislature excluded the language from the public works act that imposed the duty on a governmental unit to require the necessary bonds. Accordingly, we must give effect to its action.
Furthermore, the clear language of the statute supports the conclusion that the statute no longer imposes a duty on a governmental unit to require a bond.4
5 The statute, as presently enacted, requires the general contractor to furnish to the governmental unit payment and performance bonds. The statute clearly and unambiguously delegates the duty to the general contractor, not the government unit. "If the language employed in a statute is plain, certain and unambiguous, a bare reading suffices and no interpretation is necessary.” Dussia *195v Monroe Co Employees Retirement System, 386 Mich 244, 248; 191 NW2d 307 (1971). "It is a cardinal rule that the legislature must be held to intend the meaning which it has plainly expressed, and in such cases there is no room for construction, or attempted interpretation to vary such meaning.” MacQueen v Port Huron City Comm, 194 Mich 328, 342; 160 NW 627 (1916). We cannot and should not impose a duty on a governmental unit absent an expressed statutory directive to do so.6 Knapp v Swaney, 56 Mich 345, 347; 23 NW 162 (1885). The majority’s imposition of such a duty is repugnant to traditional notions of governmental immunity. See Benson v State Hosp Comm, 316 Mich 66, 73; 25 NW2d 112 (1946).
B
The majority’s holding is also contrary to federal case law applying the federal counterpart of the public works act, the Miller Act.7 Federal precedent applying the Miller Act, while not controlling, is instructive because of the similarities between the two acts and because the Michigan statute is modeled after the Miller Act. Pi-Con, Inc v AJ Anderson Construction Co, 435 Mich 375, 381; 458 NW2d 639 (1990). In Arvanis v Noslo Engineering Consultants, Inc, 739 F2d 1287 (CA 7, 1984), the general contractor of a federal public works project failed to furnish a payment bond as *196required by the Miller Act.8 Subcontractors sought compensation from the government after the general contractor declared bankruptcy. The subcontractors, similar to the plaintiff at bar, claimed that the government was negligent in failing to require the general contractor to post a payment bond.
Realizing that a party cannot be liable in negligence absent a duty to act, the United States Court of Appeals for the Seventh Circuit inquired into whether the Miller Act imposed a duty on the government to require a payment bond. The court, on the basis of the clear directives of the statute, answered unequivocally that it did not.
The statute requires only that contractors obtain performance and payment bonds. The statute places no affirmative obligation on the government, and says absolutely nothing about when the contractor fails to furnish the bond. The Act grants a very narrow and specific position: the right to sue on the bond (if there happens to be one) .... [Id. at 1290.]
While the court acknowledged that there was a gap in the statute, it recognized that it could provide no remedy — "especially in view of the very narrow remedy actually granted by the statute.”9 Id.
*197Similar to its federal counterpart, the public works act provides a narrow, specific remedy to subcontractors who supply labor and materials for public projects. "A claimant . . . may sue on the payment bond for the amount, or the balance thereof, unpaid at the time of institution of the civil action, prosecute such action to final" judgment for the sum justly due him and have execution thereon.” MCL 129.207; MSA 5.2321(7). The public works act does not place an affirmative obligation on a contracting governmental unit to either require or verify a valid payment bond.
Having found no statutory duty for governmental units to require or verify the validity of a payment bond, I would affirm the trial court’s holding that the plaintiff failed to state a cause of action in negligence.10
II
The majority holds that the trial court improperly dismissed the plaintiff’s claims of unjust enrichment and constructive trust. When reviewing orders granting a party’s motion for summary judgment, the Court must view the evidence in a light most favorable to the opposing party. If reasonable minds could disagree regarding the conclusions to be drawn from the facts, the order granting summary judgment must be reversed. If, however, reasonable minds could not disagree, the order of summary disposition must be affirmed. DiFranco v Pickard, 427 Mich 32, 54; 398 NW2d 896 (1986).
*198A
The plaintiff readily admits that neither an express contract nor a contract implied in fact between the plaintiff and the defendant existed. The plaintiff asks this Court, however, to imply a contract in law in order to prevent the defendant from being unjustly enriched to the detriment of the plaintiff.
When a party is unjustly enriched, the law generally requires the benefited party to provide restitution for the benefit received. Courts often employ the legal fiction of a contract implied in law or quasi contract to justify payment where no contract exists. Detroit v Highland Park, 326 Mich 78, 100; 39 NW2d 325 (1949). To recover under this theory the plaintiff must show that the defendant received a benefit from the plaintiff and that it would be unjust for the defendant to retain that benefit. Buell v Orion State Bank, 327 Mich 43, 56; 41 NW2d 472 (1950). We must be cautious in applying this doctrine, however, because the mere fact that a benefit has been conveyed does not necessarily indicate that it is unjust for the party to retain that benefit.
Even where a person has received a benefit from another, he is liable to pay therefor only if the circumstances of its receipt or retention are such that, as between the two persons, it is unjust for him to retain it. The mere fact that a person benefits another is not of itself sufficient to require the other to make restitution therefor. [Restatement Restitution, § 1, comment c, p 13.]
It is undisputed that the plaintiff bestowed a benefit to the defendant through the paving work completed on the project. However, it is not unjust *199for the defendant to retain the benefit because the defendant paid the entire contract amount. While it is true that the general contractor absconded with the contract funds and failed to compensate the plaintiff, this does not render unjust the benefit the defendant received. The defendant performed its obligations under the general contract by paying the entire contract price. The defendant cannot be held liable under an unjust enrichment theory for Dougherty’s failure to perform its obligations owed to the plaintiff under the subcontract.11
*200B
Similarly, the plaintiff’s request for the imposition of a constructive trust on the amount of the contract fund not paid to Dougherty must fail. Like a contract implied in law or quasi contract, a constructive trust is imposed as a remedy to prevent unjust enrichment.12
The constructive trust, as it was put by Mr. Justice Cardozo, "is the formula through which the conscience of equity finds expression. When property has been acquired in such circumstances that the holder of the legal title may not, in good conscience, retain the beneficial interest, equity converts him into a trustee.” [Kent v Klein, 352 Mich 652, 656; 91 NW2d 11 (1958). Citation omitted.]
The remedy of a constructive trust will be imposed when it is inequitable under the circumstances13 to allow one to retain property.
The plaintiff’s constructive trust theory must fail for the same reason the unjust enrichment claim failed: the defendant has not been unjustly *201enriched. Furthermore, the interpleader action renders this claim moot because the defendant is no longer in possession of the remaining contract funds. If the plaintiff claims error in the way the funds were distributed in the interpleader action or somehow alleges a greater priority than other subcontractors, then the plaintiff’s proper avenue of redress is to appeal the result of this inter-pleader action.14
III
The public works act does not impose a statutory duty on a contracting governmental unit to verify the validity of the payment bond furnished by a general contractor of a public works project. Absent a duty owed to the plaintiffs, the plaintiffs cannot maintain an action in negligence. Furthermore, the trial court properly dismissed the plaintiffs’ claims of unjust enrichment, constructive trust, and breach of contract to a third-party beneficiary.
Accordingly, I would affirm the judgment of the Court of Appeals.
Griffin, J., concurred with Cavanagh, C.J.

 MCL 129.201 et seq.; MSA 5.2321(1) et seq.

 See also Wells v West Bay City Bd of Ed, 78 Mich 260; 44 NW 267 (1889), Plummer v Kennedy, 72 Mich 295; 40 NW 433 (1888), and Owen v Hill, 67 Mich 43; 34 NW 649 (1887). Similarly, under an earlier version of the public works act, 1883 PA 94, this Court recognized the Legislature’s explicit command to impose a duty. "It will be noticed that the duty to require the bond is specifically imposed in all cases falling within the purview of the statute.” Owen at 46.

 The subcontractor’s remedy is not illusory because the public works act provides a method under which the subcontractor can confirm the existence of the remedy. The subcontractor can verify the validity of the furnished payment bond after receiving a certified copy of the payment bond from the governmental unit pursuant to MCL 129.208; MSA 5.2321(8).

 While the majority is correct that the former statute was repealed and 1963 PA 213 enacted in its place, the rules of statutory construction with regards to amendments are instructive because the new act deals with the identical subject matter as the former act.

 [Statutes requiring payment bonds should be liberally construed as regards the classes of labor, materials, and supplies covered, and it has been held that liberal construction of the procedural provisions must be resorted to when necessary to effect that purpose. Notwithstanding the rule of liberal construction applied to some provisions of payment bond statutes, where there is explicit language that is clear and unambiguous, the statute must be applied and not interpreted. [17 Am Jur 2d, Contractors’ Bonds, § 55, p 789. Citations omitted.]

 An examination of the entire statute supports this conclusion. The public works act explicitly states the duties imposed on a government unit: MCL 129.202; MSA 5.2321(2), "The performance bond shall be in an amount fixed by the government unit . . . .” MCL 129.203; MSA 5.2321(3), "The payment bond shall be in an amount fixed by the government unit . . . .” MCL 129.208; MSA 5.2321(8), "The agent in charge of the office of the governmental unit shall furnish to anyone making an application ... a certified copy of the bond.”

 40 USC 270(a) et seq.

 Before any contract, exceeding $25,000 in amount, for the construction, alteration, or repair of any public building or public work of the United States is awarded to any person, such person shall furnish to the United States the following bonds, which shall become binding upon the award of the contract to such person, who is hereinafter designated as "contractor.” [40 USC 270(a). Emphasis added.]

 Accord United States v Smith, 324 F2d 622 (CA 5, 1963); United States v Tac Construction Co, Inc, 760 F Supp 590 (SD Miss, 1991); Shore Contractors, Inc v Heatherly, 70S F Supp 293 (ED Va, 1987); 4-Star Construction Corp v United States, 6 Cl Ct 271 (1984); Baudier Marine Electronics, Sales & Service, Inc v United States, 6 Cl Ct 246 (1984).

 In order to support an action for negligence, the defendant must owe a legal duty to the plaintiff. Buczkowski v McKay, 441 Mich 96; 490 NW2d 330 (1992).

 The majority refers to City of Ingleside v Stewart, 554 SW2d 939 (Tex Civ App, 1977), as support for its conclusion that the trial court improperly dismissed the plaintiff’s unjust enrichment claim. Ante, p 187. Chief Judge Nye, the author of the Stewart opinion, explained the parameters of Stewart in Corpus Christi v Acme Mechanical Contractors, 736 SW2d 894, 899 (Tex App, 1987):
In effect, this Court held that a subcontractor who was able to prove that the City had "stepped into the shoes of the general contractor and chose to supervise and finish the job and pay some of the laborers and subcontractors,” was liable to the subcontractor on the theory of quantum meruit.
The facts that compelled the Stewart court to impose liability on the city on the basis of quantum meruit are distinguishable in several respects. The general contractor in Stewart failed to post the statutorily mandated bonds upon the advice of the city’s architect. Furthermore, "there was other evidence that the City impliedly agreed to pay the appellee [subcontractor] for its work.”
The trial court specifically found and the evidence supports such findings that the City initiated a dual payee system [each check drawn from the construction project’s fund was made out to the general contractor and the subcontractor to be paid] and took over the job when the contractor overspent his withdrawals. The record showed that the City assumed and undertook the duties of the general contractor and paid the laborers and subcontractors. [Stewart at 944.]
The case at bar does not present a factual situation warranting a determination of unjust enrichment. The school district did not step into the shoes of the general contractor, nor did it act in such a manner that would allow the plaintiff to infer that the school district would pay the subcontractors for their services.

 [A] quasi-contractual obligation and a constructive trust closely resemble each other, the chief difference being that the plaintiff in bringing an action to enforce a quasi-contractual obligation seeks to obtain a judgment imposing a merely personal liability upon the defendant to pay a sum of money, whereas the plaintiff in bringing a suit to enforce a constructive trust seeks to recover specific property. [Restatement Restitution, § 160, comment a, p 642.]

 A constructive trust need not arise because the property was wrongfully acquired, it may arise out of unconscionability and unjust enrichment. A constructive trust may be based upon a breach of fiduciary or confidential relationship, misrepresentation, concealment, mistake, undue influence, duress or fraud. [Grasman v Jelsema, 70 Mich App 745, 752; 246 NW2d 322 (1976).]

 The majority fails to recognize that the plaintiff agreed to the disbursement: "Following an unsuccessful appeal to the Court of Appeals, the subcontractors and the School District agreed upon a distribution of the interpleader funds which were then disbursed. The interpleader action was dismissed.”