Court Opinion

ID: 9535727
Source: CourtListenerOpinion
Date Created: 2023-08-07 04:52:16.019842+00
Date Added: 2024-06-11T13:33:19.060739
License: Public Domain

Chief Justice MULLARKEY
dissenting.
The majority reverses the trial court’s ruling that the plaintiff in this case, R.A.S. Builders, Inc. (R.A.S.), could recover some of its costs for improvements to property owned by the defendant, Euclid & Commonwealth Associates (Euclid), based on a claim of unjust enrichment. For the reasons stated in my dissent in DCB Construction Co., Inc. v. Central City Development Co., 965 P.2d 115 (Colo.1998) (Mullarkey, C.J., dissenting), I would find that ample evidence exists in this case to support the trial court’s finding of unjust enrichment. Accordingly, I respectfully dissent.
I.
The circumstances in this case are very similar to DCB Construction, where a contractor brought an unjust enrichment claim against the owner of a property for improvements made to the property after the tenant defaulted on paying the contractor. See DCB Constr., 965 P.2d at 118. Here, Euclid leased some property to Child Care Centers of North America, Inc. d/b/a/ Kid’s Place (Tenant) who then contracted with R.A.S. for tenant finish construction. See maj. op. at 1242-1243. After R.A.S. performed $106,695 worth of work, the Tenant defaulted on its contract with R.A.S. Subsequently, R.A.S. brought a claim of unjust enrichment against Euclid, which kept the construction improvements done by R.A.S.
The majority applies its newly formulated unjust enrichment test from DCB Construction, 965 P.2d at 120. In order for a plaintiff to establish an unjust enrichment claim, the plaintiff now must show: (1) at plaintiffs expense, (2) defendant received a benefit, and (3) under circumstances that would make it unjust for defendant to retain the benefit without paying. See maj. op. at 1244. The majority holds that R.A.S. satisfied steps one and two, but is precluded from recovering because it failed to show “some type of improper, misleading, or deceitful conduct” by Euclid. Maj. op. at 1244. The requirement of improper, misleading, or deceitful conduct imposes an additional hurdle that has no basis in our prior case law.
In my dissent in DCB Construction, I explained why wrongful conduct should not be a prerequisite to an unjust enrichment claim. See DCB Constr., 965 P.2d at 124-125. Thus, I would follow prior Colorado ease law and affirm the trial court’s determination in favor of R.A.S. under its claim for unjust enrichment. See Ninth Dist. Prod. Credit Ass’n v. Ed Duggan, Inc., 821 P.2d 788, 797 (Colo.1991) (holding that an unjust enrichment claim could prevail contrary to the UCC priority system); Frank M. Hall & Co. v. Southwest Properties Venture, 747 P.2d 688, 691 (Colo.App.1987) (holding that an unjust enrichment claim could exist where landlord took an active role in completion of construction work).
The facts of this case show that the majority’s requirement of wrongful conduct undermines the principles of unjust enrichment and inequitably allows Euclid to keep improvements for which it did not pay. The lease between Euclid and the Tenant explicitly stated that the Tenant was responsible for the tenant finish construction, that Euclid had the right to approve of such plans, that all non-moveable alterations would become the property of Euclid, and that Euclid would pay the Tenant $60,000 for the construction provided certain conditions were met. Additionally, an agent from Euclid confirmed to R.A.S. that Euclid was to contribute $60,000 to the Tenant for tenant finish construction *1246under certain conditions. See maj. op. at 1243. In fact, the contract between the Tenant and R.A.S. stated that the “[b]alance of contract to be paid by landlord [Euclid] via tenant allowance joint check at completion.” Moreover, the trial court found that Euclid had an agent overseeing the project.
Contrary to the majority, I would not adopt a per se rule that requires some type of wrongful conduct in order for R.A.S. to recover. As I stated in my dissent in DCB Construction, such a requirement unduly restricts a party’s ability to recoup its costs and is inconsistent with Colorado ease law. See DCB Constr., 965 P.2d at 125. Properly applying Hall and Duggan1 here, I would hold that ample evidence exists showing that Euclid took an active role in or encouraged the improvements which supports the trial court’s ruling that Euclid was unjustly enriched. Cf. Dan B. Dobbs, Law of Remedies § 12.20(3), at 469-70 (2d ed.1993) (stating that while a subcontractor is not generally allowed restitution against a landowner, a subcontractor is entitled to enforce its claim against any funds still held by the landowner but which are owed to the general contractor).
II.
Even if we were to rely only on the Restatement of Restitution (1937), the facts here support a finding of unjust enrichment because there is evidence that Euclid requested that R.A.S. provide the tenant finish construction. See Restatement of Restitution § 112 (listing “request” as an exception supporting restitution). Euclid’s request can be inferred from the lease provisions making the Tenant responsible for all tenant finish construction, which would eventually become the property of Euclid. Moreover, Euclid retained the right specifically to approve the improvements and had an agent monitoring the work. Most importantly, Euclid’s agent specifically informed R.A.S. that it planned on contributing $60,000 to help pay for the construction under certain conditions.
III.
For the foregoing reasons, Euclid was an active participant with regard to the construction and, therefore, should pay for the improvements that it will keep. Based on my dissent in DCB Construction, 965 P.2d at 125, I would follow the court of appeals’ holding in Hall and would allow the trial court’s ruling to stand. See Hall, 747 P.2d at 691. There is sufficient evidence in the record supporting the trial court’s ruling that Euclid was unjustly enriched and should pay R.A.S. for part of the construction. Accordingly, I respectfully dissent.
I am authorized to say that Justice SCOTT joins in this dissent.

. As I noted in my dissent in DCB Construction, the applicability of the rule in Duggan to this type of case is questionable. See DCB Constr., 965 P.2d at 124. The "initiate or encourage the transaction” requirement in Duggan applied to a situation where an unjust enrichment claim undermined the predictability created by a statutory scheme. See Duggan, 821 P.2d at 797 (holding that unjust enrichment claim could prevail contrary to the UCC priority system). There is no applicable statutory scheme in this case, so the "initiate or encourage the transaction" requirement in Duggan, while relevant, may not be dispositive. See Cedar Lane Invs. v. American Roofing Supply of Colorado Springs, 919 P.2d 879, 885 (Colo.App.1996) (distinguishing the unjust enrichment rule in Duggan because no statutory scheme existed).