Court Opinion

ID: 6318048
Source: CourtListenerOpinion
Date Created: 2022-02-28 17:10:55.118488+00
Date Added: 2024-06-11T09:01:33.672176
License: Public Domain

J-A15024-21

                             2022 PA Super 36

ARTISAN BUILDERS, INC.                           IN THE SUPERIOR COURT
                                                           OF
                                                      PENNSYLVANIA
                         Appellant

                    v.

SO YOUNG JANG

                         Appellee                   No. 47 EDA 2021

              Appeal from the Order Entered November 17, 2021
               In the Court of Common Pleas of Chester County
                     Civil Division at No: 2016-07178-ML

BEFORE: BOWES, J., STABILE, J., and MUSMANNO, J.

OPINION BY STABILE, J.:                         FILED FEBRUARY 28, 2022

      Appellant, Artisan Builders, Inc. (“ABI”), appeals from the November

17, 2020 order entered in the Court of Common Pleas of Chester County in

favor of Appellee, So Young Jang (“Jang”), following denial of ABI’s quantum

meruit claims stemming from residential renovation work performed for Jang.

Because we find the trial court conflated quantum meruit with unjust

enrichment and denied ABI’s quantum meruit claims based on unjust

enrichment principles, we reverse and remand.

     The trial court provided the following factual background:

     ABI entered into a series of agreements with Jang to perform
     renovations at Jang’s residential property located at 222 Lenape
     Drive, Berwyn, PA, 19312. ABI is a small, local business based in
     East Norriton, PA. The principal of ABI, Scott McClain, has been
     in the construction business for more than twenty years.
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        Work on the property began after multiple contracts were signed
        by Jang on or about February 2, 2016. The scope of work initially
        contemplated renovation of the kitchen. However, the scope was
        changed to include additional work throughout the rest of the
        house, including rehabilitation and renovation of, inter alia, the
        first and second floor flooring, the master bathroom, baseboards,
        lighting, crawlspace insulation, replacement of structurally
        unsound joists, and multiple doors and door frames. The scope
        of the work would eventually comprise five (5) base contracts and
        eighteen (18) change orders. Jang was aware of the work
        being performed, and all work was performed with the
        express permission and authority of Jang.

        On or about June 29, 2016, before the work on the house was
        complete, Jang fired ABI.

        On or about January 14, 2020, a trial was held before the
        Honorable Mark L. Tunnell, at which time both Mr. McClain and
        Ms. Jang testified.[1] Following the close of ABI’s case, on motion
        by Jang, Judge Tunnell granted a compulsory non-suit on the
        Mechanic’s Lien claim, holding that the contracts between [ABI]
        and Jang were invalid, as the contracts did not comply with the
        terms of the Home Improvement and Consumer Protection Act
        (“HICPA”).[2] Judge Tunnell, however, gave ABI leave of court to
        file an amended complaint to seek damages for quantum meruit,
        and ordered that the trial be continued for the court to determine
        the reasonable value of the services requested by Jang.

Order, 7/17/20, n.1 at 1-2 (emphasis added; minor alterations made).

        Accordingly, ABI filed an amended complaint. However, in the amended

complaint, ABI sought damages not only for quantum meruit but also for

unjust enrichment and breach of contract. Jang filed preliminary objections

____________________________________________

1   Ms. Jang testified as on cross-examination during ABI’s case-in-chief.

273 P.S. §517.1-.19. Relevant to the trial court’s ruling is Section 517.7.(a),
which sets forth thirteen prerequisites to making a home improvement
contract valid or enforceable against an owner.

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asserting, inter alia, that the trial court’s January 14, 2020 order permitted

ABI to seek damages for quantum meruit only. By order entered March 12,

2020, the trial court sustained the preliminary objections filed by Jang with

respect to all claims other than quantum meruit. Order, 3/12/20.

      Trial reconvened on June 10, 2020, at which time “ABI produced over

five hundred (500) pages of receipts, time sheets, invoices, documents signed

by Jang, emails, and other evidence of the work ABI performed.”            Order,

7/17/20, n. 1 at 3. ABI asserted it was due $35,371.47 for services provided,

based on a QuickBooks report that tracked costs, expenses, and a comparison

of the original estimates with the invoices billed out. Id. (citing N.T., 6/10/20,

at 11). The updated total amount claimed by ABI was $43,525.06, which

included the original $35,371.47 sum, as well as $6,537.01 for storage of

kitchen cabinets ordered for Jang and sums related to the litigation, including

administrative costs for filings fees. Id.

      After acknowledging the evidence presented at the June 10, 2020

proceeding, the court summarily stated, “But that is not what the court was

looking for.” Id. The court maintained that a defendant found to be unjustly

enriched based on an implied contract is to “pay to the plaintiff the value of

the benefit conferred.” Id. (citing Mitchell v. Moore, 729 A.2d 1200 (Pa.

Super. 1999) (emphasis in original)). “However, the plaintiff cannot merely

submit its own loss, i.e., the value of labor and materials expended, as the

measure of recovery, but must instead demonstrate that the defendant has in

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fact been benefitted, as the Supreme Court of Pennsylvania held in 1963, in

Meehan v. Cheltenham Twp., 189 A.2d [593] (Pa. 1963).” Id., n.1 at 4.

The court determined it “must find in favor of” Jang, concluding:

       Here, although ABI went to considerable trouble to amass all its
       invoices, estimates, contracts and other such documents in a thick
       file, this court has no idea of whether there was a benefit to the
       Jang property and, if so, in what amount. Such a benefit could
       have been shown by, for example, appraisals secured by
       knowledgeable individuals. In D.A. Hill Co.,[3] the figures were a
       wash, so no enrichment resulted.

Id. The court’s order indicated that, “after hearings on January 14, 2020 and

June 10, 2020, the court, sitting without a jury, finds in favor of [Jang and

against ABI] in no amount.” Id. at 1.

       In response to the trial court’s July 17, 2020 ruling, ABI filed post-trial

motions.    The trial court denied the motions on November 17, 2020, and

judgment was entered in Jang’s favor. This timely appeal followed. Both ABI

and the trial court complied with Pa.R.A.P. 1925.

       ABI asks us to consider two issues in this appeal:

       A. Did the trial court err when it entered judgment against
          Appellant ABI and in favor of Appellee Jang after finding that
          ABI did not prove by a preponderance of the evidence that it
          was entitled to recover pursuant to quantum meruit/unjust
          enrichment?

       B. Did the trial court err when it applied D.A. Hill Co. v.
          Clevetrust Realty Investors, 573 A.2d 1005 (Pa. 1990), and
          Meehan v. Cheltenham Township, 189 A.2d 593 (Pa. 1963)
          and concluded Appellant ABI did not establish that Appellee
____________________________________________

3D.A. Hill Co. v. Clevetrust Realty Investors, Inc., 573 A.2d 1005 (Pa.
1990)

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         Jang was benefited by the over One Hundred Thousand
         ($100,000.00) Dollars of work ABI performed on her house?

Appellant’s Brief at 4. Because ABI’s issues are interrelated, we consider them

together.

      As noted above, at the conclusion of proceedings in January 2020, the

trial court granted Jang’s motion for compulsory nonsuit but permitted ABI to

amend its complaint to assert a quantum meruit claim. In other words, the

only claim that survived the January proceedings was a potential equity claim.

Following the June 2020 proceedings, the trial court rejected that equity claim.

In Wilson v. Parker, 227 A.3d 343 (Pa. Super. 2020), this Court explained:

      When reviewing equitable decrees, our scope of review and
      standard of review are deferential, but our deference has limits.
      This Court has said:

         We are bound to accept the trial judge’s findings of fact, and
         accord them the weight of a jury verdict where supported
         by competent evidence.         As for factual and legal
         conclusions, we are not bound by the trial court’s reasoning,
         and may reverse for an abuse of discretion or error of law.

Id. at 352 (quoting Den-Tal-Ez, Inc. v. Siemens Capital Corp., 566 A.2d

1214, 1217 (Pa. 1989) (footnote, brackets, and ellipses omitted)).

      To put ABI’s issues in context, we first address the difference between

quantum meruit and unjust enrichment. In Angino & Rovner v. Jeffrey R.

Lessin & Associates, 131 A.3d 502 (Pa. Super. 2016), this Court explained

that “[q]uantum meruit is an equitable remedy, which is defined as ‘as much

as deserved’ and measures compensation under an implied contract to pay

compensation as reasonable value of services rendered.”        Id. at 508 (Pa.

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Super. 2016) (citation and alteration omitted). See also Commonwealth

Dept. of Public Welfare v. UEC, Inc., 397 A.2d 779, 782 (Pa. 1979)

(quantum meruit is “the reasonable value of the services performed”).

     While the remedy of quantum meruit provides for restitution based on

the reasonable value of services performed or provided, unjust enrichment

“requires the defendant to pay to the plaintiff the value of the benefit

conferred.” Durst v. Milroy General Contracting, Inc., 52 A.3d 357, 360

(Pa. Super. 2012) (citation omitted). The elements necessary to prove unjust

enrichment are:

     (1) benefits conferred on defendant by plaintiff; (2) appreciation
     of such benefits by defendant; and (3) acceptance and retention
     of such benefits under such circumstances that it would be
     inequitable for defendant to retain the benefit without payment of
     value. (citations omitted). The application of the doctrine depends
     on the particular factual circumstances of the case at issue. In
     determining if the doctrine applies, our focus is not on the
     intention of the parties, but rather on whether the defendant has
     been unjustly enriched.

Id. (citation omitted). In Am. & Foreign Ins. Co. v. Jerry’s Sport Ctr.,

Inc., 2 A.3d 526 (Pa. 2010), our Supreme Court noted:

     Unjust enrichment is the retention of a benefit conferred by
     another, without offering compensation, in circumstances where
     compensation is reasonably expected, for which the beneficiary
     must make restitution. Black’s Law Dictionary (8th ed. 2004). An
     action based on unjust enrichment is an action which sounds in
     quasi-contract or contract implied in law.           Schott v.
     Westinghouse Electric Corp., 259 A.2d 443, 448 (Pa. 1969).

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Jerry’s Sport Ctr., 2 A.3d at 531 n.7.4

       We cite with approval the Supreme Court of Maine that aptly explained

the difference between quantum meruit and unjust enrichment most concisely

when it stated:

       Quantum meruit involves recovery for services or materials
       provided under an implied contract. Unjust enrichment describes
       recovery for the value of the benefit retained when there is no
       contractual relationship, but when, on the grounds of fairness and
       justice, the law compels performance of a legal and moral duty to
       pay.

Bowden v. Grindle, 651 A.2d 347, 350 (Me. 1994) (citations omitted).

       Further:

       Quantum meruit is the measure of recovery under the quasi-
       contract. It is equal to the reasonable value of the services
       provided. The recovery pursuant to a claim for unjust enrichment,
       on the other hand, is limited to the amount of the benefit realized
       and retained by the defendant.        Although there may be a
       relationship between these two amounts, they are not necessarily
       the same.

Id. at 351 (Me. 1994) (citations omitted). Although we are clearly not bound

by decisions from our sister states, they may provide persuasive authority.

____________________________________________

4 We acknowledge that our case law does not always distinguish quantum
meruit from unjust enrichment and sometimes conflates the two. See, e.g.,
Northeast Fence & Irons Works v. Murphy Quigley Co., 993 A.2d 664,
667 (Pa. Super. 2007) (“Unjust enrichment is a synonym for quantum
meruit.”). See also Durst, 52 A.3d at 360 (“Quantum meruit is an equitable
remedy to provide restitution for unjust enrichment in the amount of the
reasonable value of services.”); Jerry’s Sport Ctr., Inc., 2 A.3d at 532 n. 8
(Pa. 2010) (citing Black's Law Dictionary (8th ed. 2004) (same).

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Century Indemnity Company v. OneBeacon Insurance Company, 173

A.3d 784, 792 n. 14 (Pa. Super. 2017).

     Instantly, the trial court held that the contract between the parties was

not valid due to non-compliance with HICPA. Appellant correctly pursued a

cause of action sounding in quantum meruit as illustrated by precedent.

     In Durst, as in the case before us, homeowners who requested

renovations to their home refused to pay the contractor. There, the work was

performed pursuant to an oral agreement, meaning there was no HICPA-

compliant contract. The Court held that the lack of a HICPA-compliant written

contract did not prevent the contractor from pursuing a quantum meruit claim.

Id. at 361 (“we hold that quasi-contract theories of recovery survive the

HICPA”).

     Similarly, in Shafer Elec. & Constr. v. Mantia, 96 A.3d 989 (Pa.

2014), homeowners refused to pay the contractor they hired to build an

addition to their home. Our Supreme Court held that HICPA did not preclude

a contractor from recovering in quantum meruit in the absence of an

enforceable contract as defined by HICPA. Id. at 996. The Court explained:

     [I]t is well-settled at common law, however, that a party shall not
     be barred from bringing an action based in quantum meruit when
     one sounding in breach of express contract is not available. While
     the General Assembly, in its role as the policy-making branch of
     government, certainly may in “particular sets of circumstances”
     modify the structure of the common law, there is no indication
     that the legislature has done so in the Act. Indeed, the Act “is
     silent as to actions in quasi-contract, such as unjust enrichment
     and quantum meruit—which, by definition, implicate the fact that,

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       for whatever reason, no [valid] contract existed between the
       parties.” Durst, 52 A.3d at 361 (emphasis added).

Shafer, 96 A.3d at 996 (citations omitted). The Court noted:

       Otherwise, this Court would sanction the ability for homeowners
       to refuse payment of perfect construction work solely because a
       contractor did not comply with the Section 517.7(a) requirements.
       Accord Durst, 52 A.3d at 361 (holding that Appellants’
       “interpretation of the statute would allow them to prevail even if
       the work was perfect and they simply did not want to pay.”).
       Presumably, however, Section 517.7(g) could apply if subsection
       (a) is met, but the contract is otherwise unenforceable.

Id. at 996 n.6.5

       Here, the trial court properly concluded that ABI did not comply with

Section 517.7(a) and, therefore, was not entitled to prevail on a breach of

contract claim because there was no valid contract between ABI and Jang.

The court properly permitted ABI to file an amended complaint asserting a

claim for quantum meruit and invited ABI to provide evidence to support that

claim at the June 10, 2020 reconvened hearing. However, rather than analyze

the evidence presented by ABI based on quantum meruit’s “reasonable value

of services provided” standard, the court analyzed ABI’s evidence using “the

benefit conferred” criteria appropriately employed to establish a claim of

unjust enrichment. In doing so, the court erred.

____________________________________________

5 Section 517.7(g) (Contractor’s recovery right) provides, “Nothing in this
section shall preclude a contractor who has complied with subsection (a) from
the recovery of payment for work performed based on the reasonable value
of services which were requested by the owner if a court determines that it
would be inequitable to deny such recovery.” 73 P.S. § 517.7(g).

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      As reflected in the above quotes from Angino & Rovner and Durst, a

cause of action for quantum meruit is an equitable action providing restitution

in the amount of the reasonable value of services rendered. Nevertheless,

the trial court, relying on D.A. Hill and Meehan, rejected ABI’s quantum

meruit claim because a “plaintiff cannot merely submit its own loss, i.e., the

value of labor and materials expended, as the measure of recovery, but must

instead demonstrate that the defendant has in fact been benefitted, as the

Supreme Court of Pennsylvania held in 1963, in Meehan v. Cheltenham

Twp., 189 A.2d [593] (Pa. 1963).” Trial Court Order, 7/17/20, n.1 at 4. The

court concluded that it had “no idea of whether there was a benefit to the Jang

property and, if so, in what amount.   Such a benefit could have been shown

by, for example, appraisals secured by knowledgeable individuals.” Id. (citing

D.A. Hill, supra).

      We find the trial court’s reliance on D.A. Hill and Meehan misplaced.

Initially, we note that D.A. Hill and Meehan are factually distinguishable. As

ABI correctly observed:

      The critical distinction between the Meehan and Hill matters and
      the matter at hand is that in Meehan and Hill the defendants did
      not request the work that plaintiffs performed. Rather, the
      defendants were entit[ies] that became responsible for unfinished
      projects after the developers became insolvent; in Meehan,
      Cheltenham Township became responsible for a residential
      development after the developer became insolvent, and in D.A.
      Hill, a bank took over a project for an insolvent developer.
      Following those insolvencies, subcontractors sued the Township
      and bank, respectively, for unpaid invoices. In that situation, the
      Supreme Court held that appraisals were required to establish the

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       benefit to the defendants for purposes of payment, because the
       defendants did not request or contract for the services performed.

       In this matter, there is no need to have an appraiser or any other
       witness come to testify [as] to the degree to which the work
       performed by ABI benefited Jang because Jang herself requested
       that the work be done.

Appellant’s Brief at 15-16 (emphasis in original).        The Supreme Court

recognized the distinction in D.A. Hill, noting, “As this Court held in Meehan,

a third party is not unjustly enriched when it receives a benefit from a contract

between two other parties where the party benefited has not requested the

benefit or misled the other parties.” D.A. Hill, 573 A.2d at 1010 (emphasis

in original).6

       ABI asserts, and we agree, that the case before us is distinguishable

from D.A. Hill and Meehan. ABI contends that this case “is most closely

aligned with [Northeast] Fence & Iron Works, Inc. v. Murphy Quigley

Co., 933 A.2d 664 (Pa. Super. 2007)[,] a quantum meruit action by

subcontractor against general contractor (which requested the services) for

unpaid work,” in which the trial court determined that the subcontractor’s

invoices provided sufficient evidentiary support for the value of the work

performed at the contractor’s request. Appellant’s Brief at 36. In Northeast

____________________________________________

6 We note that Ira G. Steffy & Son, Inc. v. Citizens Bank of Pennsylvania,
7 A.3d 278 (Pa. Super. 2010), quoted and relied upon by the trial court in its
Rule 1925(a) Opinion, see Rule 1925 Opinion, 1/11/21, at 3 (unnumbered),
is also a case involving a third-party claim and is, therefore, distinguishable
from the case before us.

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Fence, this Court rejected the appellant’s reliance on, inter alia, D.A. Hill and

Meehan for the proposition that to recover for quantum meruit, it was

insufficient for Northeast Fence to produce unpaid invoices.         This Court

recognized that Northeast Fence provided services at the request of Murphy

Quigley, which was trying to avoid paying Northeast Fence for the services

provided. Id. at 670 (“Unlike the factual scenarios at issue in D.A. Hill Co.,

Meehan, and Ravin[7], [Murphy Quigley] recruited [Northeast Fence] to

install the fencing.”)

       In Shafer Elec., our Supreme Court held that “a contractor claiming

quantum meruit may only recover the reasonable value of the services

rendered, as determined by a trial court after taking evidence on the matter.”

Shafer Elec., 96 A.3d at 995. Despite the evidence presented at the June

2020 hearing—after the trial court continued the January 2020 proceeding to

enable the court “to determine the reasonable value of the services requested

by Jang,” Order, 7/17/20, n.1. at 2, the trial court nevertheless relied on D.A.

Hill and Meehan and concluded that ABI’s documentary evidence, including

invoices, could not establish the reasonable value of the services provided.

____________________________________________

7 Ruthrauff, Inc. v. Ravin, Inc., 914 A.2d 880 (Pa. Super. 2006). In
Northeast Fence, we recognized that “Ravin is analogous to Meehan.
Therein, the plaintiff sought to recover for improvements to a retail space.
We concluded that the plaintiff could not recover since the defendant, the
building owner, had not requested the plaintiff’s services and had not misled
the plaintiff and therefore was not enriched unjustly.” Northeast Fence, 933
A.2d at 670.

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      As reflected in its Rule 1925(a) Opinion, the trial court rejected ABI’s

assertion that facts of the instant case are distinguishable from the factual

scenarios in D.A. Hill. Rule 1925(a) Opinion, 1/11/21, at 2. Instead, the trial

court concluded that the requirements for establishing a claim for unjust

enrichment outlined in D.A. Hill and Meehan were “recently reiterated” in

Karden Construction Services v. D’Amico, 219 A.3d 619 (Pa. Super 2019).

Id. The trial court’s reliance on Karden is misplaced for two reasons. First,

Karden involved the remedy for unjust enrichment rather than for quantum

meruit. Second, as ABI contends, Karden is distinguishable because it was

not a construction case and, moreover, because the trial court determined

that the appellant lacked credibility. Although this Court affirmed the trial

court’s denial of recovery in Karden, ABI argues, it did so “because it refused

to disturb the trial court’s determination of appellant’s credibility . . . because

the trial court didn’t believe appellant, and there was substantial evidence

presented by appellee disputing appellant’s testimony.” Appellant’s Brief at

41-42 (some capitalization omitted).

      As ABI recognizes, unlike Karden, here there was no opposing

testimony at trial as to the contracts and change orders signed or initialed by

Jang, and there was no evidence ABI did not perform services for which it

sought payment. Rather, Jang acknowledged that she agreed to pay for the

services she requested and that she approved the services performed. Id. at

43.

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      Because quantum meruit damages are determined based on services

provided, we find that the trial court committed error of law when it concluded

recovery must be measured by the benefit to Jang. Further, we find the court

erred when it determined that D.A. Hill and Meehan controlled and that ABI

“cannot submit its own loss, i.e., the value of labor and material expended, as

the measure of recovery.” Order, 7/17/20, n.1 at 4. We reject the proposition

that, without something akin to an appraisal, the trial court could have “no

idea of whether there was a benefit to the Jang property and, if so, in what

amount.” Order, 7/17/20, n.1 at 4. Benefit to the Jang property is not at

issue because the claim was not one for unjust enrichment. However, while

ABI asks us to accept wholesale its contention that its unpaid invoices, along

with costs of storing cabinets and costs of litigation, constitute the proper

measure of damages, it is not this Court’s role to determine the reasonable

value of the services provided by ABI. Therefore, we remand to the trial court

to determine the reasonable value of the services based on the evidence

presented at the January and June 2020 proceedings, and to convene an

additional hearing if it deems it necessary to do so.

      Order reversed. Case remanded for further proceedings in accordance

with this Opinion. Jurisdiction relinquished.

      Judge Musmanno joins.

      Judge Bowes files a concurring opinion in which Judge Stabile joins.

      This decision was reached prior to the retirement of Judge Musmanno.

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Judgment Entered.

Joseph D. Seletyn, Esq.
Prothonotary

Date: 2/28/2022

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