Court Opinion

ID: 9679389
Source: CourtListenerOpinion
Date Created: 2023-08-24 06:51:40.957579+00
Date Added: 2024-06-11T18:17:13.167174
License: Public Domain

HENDERSON, Justice
(dissenting).
I first make the point that appellee-car-penter sued in quantum meruit. How, then, can he substantiate (prove) his damages by costs (bills of materialmen and time cards of his employees)? The trial court entered judgment in favor of the carpenter simply by adding up these costs. This is blatantly incorrect. The carpenter’s brief states: “After reviewing the evidence, the [trial] court concluded that the reasonable value of the work performed and the materials included in the structure happened to bé the costs of those items.” Suit was commenced alleging the reasonable value of the labor performed and materials furnished as being $15,103.15. Appellant paid, prior to suit, the sum of $6,012.66. Although it appears that the judgment (under the carpenter’s and the trial court’s arithmetic) should have been for the sum of $9,090.49, the judgment rendered was in the amount of $9,081.75. This is a miniscule disparity but I point it out so that the facts are before the reader and the reader is informed as to the manner by which the trial court arrived at its decision.
The carpenter’s approach to proving up damages is entirely foreign, if not a defilement, to the theory of quantum meruit. There is not a shred of evidence in this record to establish reasonable value of the services. Bear in mind that the agreement for the value of the services is out the legal window — so to speak — even under the theory of the carpenter. How he can theoretically sneak back in the window, without establishing reasonable value of services, is more than I can understand. On this point alone, I would reverse and remand for a new trial on damages (insufficient evidence). The Olberding case, cited by the majority, is tougher against the carpenter than it is for him. The Iowa Court quoted the general rule and then proceeded to write around it due to the applicable evidence.
The principles regarding recovery on the basis of quantum meruit are relatively simple and well settled, as aptly stated in the following excerpt from D. Dobbs, Handbook on the Law of Remedies (1973):
The plaintiff who has built on another’s land may have spent quite a bit of money in doing so. He may have bought supplies, such as lumber and brick, paid laborers, and put in some of his own labor. The project may have been well managed, or it may have been poorly managed. The plaintiff may have bought goods or hired contractors at inflated prices, or he may have bargained well and achieved very favorable bargains. His costs in putting up the house, then, do not necessarily reflect the value of the benefit it represents to the landowner. This seems a simple point, but it is one that repeatedly causes difficulty. Perhaps the reason is that the plaintiff’s *315costs would often be a recoverable item if he had an enforceable contract to build the house. In such a case he would ordinarily have an option to recover his expected profit if the defendant breached, or his reliance expense, which is to say, his costs. But this is damages or loss to the plaintiff, not restitution, and of course the plaintiff is not entitled to damages from the defendant who has committed no tort nor breached any contract. He is entitled only to restitution, representing the value of the benefit to the defendant. His costs may represent some kind of evidence of value, especially if it is added that the costs were reasonable, but they do not represent a recoverable item of restitution in themselves.
Id. at 261 (emphasis in original) (footnote omitted). I maintain that one seeking to recover on the basis of restitution or quantum meruit may recover only the value of services rendered and not his costs; that is, only the amount attributable to a reasonable value for services rendered governs the resolution of this dispute. This principle has been applied by this Court in Stark v. Stark, 79 S.D. 178, 109 N.W.2d 904 (1961); Fehlhafer v. Reiners, 37 S.D. 289, 157 N.W. 1058 (1916); and Woodford v. Kelley, 18 S.D. 615, 101 N.W. 1069 (1904).
In Olberding, the plaintiff introduced considerable evidence as to the reasonable value of its services and, after reviewing the evidence, the Iowa Supreme Court affirmed the lower court’s judgment in favor of the plaintiff. Notwithstanding its decision, the Iowa Court felt compelled to state: “We do, however, reiterate the principle that recovery in cases such as the one with which we are concerned is based upon the reasonable value of services and materials to the owner and not upon actual cost to the contractor.” Id. 243 N.W.2d at 878. Olberding and this case are distinguishable, however. In this case, not even the carpenter himself testified that the materialmen bills and his employees’ time cards were reasonable charges. Dobbs, Remedies, states the law applicable to this situation: “The principle in these cases is fair assessment of the benefit actually received. This cannot be done by examining the contract price, where the parties have a different notion of what that price is and this different notion itself constitutes the basic mistake.” Id. at 744.
Before reaching the above issue, however, I find myself in disagreement with the rescission allowed by the trial court.
Frankly, a fair reading of the record establishes that the carpenter is simply trying to back out of his deal. The carpenter agreed to remodel a house for a price. He now wants to rescind the contract on remodeling the house and yet wants to affirm the contract to get paid. This is his legal posture: he wants a “kinda half-rescission.” One ponders: how do you rescind the remodeling of a house when it is already entirely remodeled? There is simply no way whereby appellant can ever be put back into his original position. It appears to me that the carpenter not only wants a partial rescission but wants it under his own terms. The trial court did not find that appellant could be restored to pre-con-tract condition, and did not order the carpenter to restore appellant to such condition. SDCL 21-12-2 thus prohibits the trial court from granting rescission.
Certain facts bear relevance to this dispute. The carpenter was familiar with bidding and estimating; appellant was not. Appellant did not know construction, but the carpenter did. And the carpenter gave a figure of $7,000.00 (carpenter: “He asked me what it was going to take to fix the building, and’ I said $7,000.00.”) (emphasis mine). The term “fix the building” is more broad and general than “labor.” The carpenter’s final bill was in excess of $15,-000.00. This amount is more than double the amount that the carpenter stated it would take “to fix the building.” It appears to be undisputed that appellant told the carpenter that he wanted to have all the work completed on the house so that it could be ready for occupancy. The following question was asked of the carpenter at trial by appellant’s counsel: “I guess what I’m asking, Mr. Carnicle, is this. Did you *316understand . . . that he [appellant] wanted the house fixed so he could move in and live in it? ” To this question the carpenter replied: “Yes.” How, then, could there be a mistake if the carpenter knew what appellant desired? The point is that labor alone would not have readied the house for occupancy. Another relevant fact: the carpenter received $5,000.00 from appellant in October of 1978; one month later, the carpenter astounds appellant with a tremendous bill.
According to the majority, we are considering this basic legal question: should we tolerate a rescission of a contract for a mutual mistake? I subscribe to the thinking of the North Dakota Supreme Court in Security State Bank of Wishek v. State, 181 N.W.2d 225, 233-234 (N.D.1975):
The modern — and, we believe, the better — rule for rescission of a contract for mistake is . . . [that] cancellation should not be decreed against a party whose conduct did not contribute to or induce the mistake and who will obtain no unconscionable advantage therefrom.
Appellant has done no wrong; he is entitled to the benefit of his bargain; he neither contributed to nor induced a mistake; he has been put “upon by a carpenter in whom he reposed his trust and faith. For all of the above reasons, I cannot join in the majority opinion and would reverse the trial court.