Bradshaw Renovations, LLC v. Barry Graham and Jacklynn Graham ( 2024 )

IN THE COURT OF APPEALS OF IOWA
No. 22-1721
Filed October 2, 2024
BRADSHAW RENOVATIONS, LLC,
Plaintiff/Counterclaim Defendant-Appellant/Cross-Appellee,
vs.
BARRY GRAHAM and JACKLYNN GRAHAM,
Defendants/Counterclaim Plaintiffs-Appellees/Cross-Appellants.
________________________________________________________________
Appeal from the Iowa District Court for Polk County, Sarah Crane, Judge.
A construction contractor appeals an adverse jury verdict on homeowners’
consumer-fraud claims and the district court’s judgment on the contractor’s unjust-
enrichment and quantum-meruit claims, and homeowners cross-appeal their
attorney-fees award. AFFIRMED ON APPEAL AND CROSS-APPEAL AND
REMANDED WITH DIRECTIONS.
Matthew J. Hemphill of Bergkamp, Hemphill & McClure, P.C., Adel, for
appellant.
Zachary J. Hermsen and Anna E. Mallen of Whitfield & Eddy, P.L.C., Des
Moines, for appellees.
Heard by Schumacher, P.J., Langholz, J., and Doyle, S.J.*
*Senior judge assigned by order pursuant to Iowa Code section 602.9206
(2024).
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LANGHOLZ, Judge.
Barry and Jacklynn Graham contracted with Bradshaw Renovations, LLC
to renovate their home. When the Grahams failed to pay Bradshaw Renovations’
final invoice, it sued them for breach of contract, unjust enrichment, and quantum
meruit. The Grahams counterclaimed for breach of contract and consumer fraud
under Iowa Code section 714H.5 (2020). After a trial, the jury rejected Bradshaw
Renovations’ breach-of-contract claim and found for the Grahams on their claims,
awarding them actual and treble statutory damages. The court dismissed
Bradshaw Renovations’ unjust-enrichment and quantum-meruit claims and
awarded the Grahams attorney fees on the consumer-fraud claim.
Bradshaw Renovations appeals the consumer-fraud jury verdict and the
court’s dismissal of its unjust-enrichment and quantum-meruit claims. The
Grahams cross-appeal their attorney-fee award and request appellate fees.
Given the considerable deference owed to the jury, we hold that substantial
evidence supports the consumer-fraud verdict and that the court did not abuse its
discretion in denying the motion for a new trial on the ground that the verdict failed
to administer substantial justice between the parties. We also agree that the
district court correctly dismissed Bradshaw Renovations’ unjust-enrichment and
quantum-meruit claims because they sought damages for matters covered by the
parties’ written contract. And we affirm on the Grahams’ cross-appeal because
they failed to raise their claimed error in the district court and thus failed to preserve
it for our review. We agree that the Grahams are entitled to some appellate
attorney fees but must remand to the district court to determine the amount since
they have failed to submit an affidavit supporting their request.
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I. Factual Background and Proceedings
The Contract. Bradshaw Renovations and the Grahams agree that they
entered into a written contract for the renovation of the Grahams’ home in
August 2019. But they disagree whether the contract set a fixed price for the
project or obligated the Grahams to pay for the time and materials spent on the
project. The contract includes a five-page itemization of labor and materials for
the project totaling $136,168.16, which it describes as “the current estimate.” And
it says that Bradshaw Renovations “will revise the estimate as we go to keep us
up to date as things change for allowance and scope of work through out the
project.” But the contract also describes “this estimate” as “an offer to you from
Bradshaw Renovations, LLC, for the services and cost detailed herein.” It provides
that the Grahams’ “signature below constitutes acceptance of the offer and a
binding contract.” And it sets a payment schedule requiring a $1000 “payment
upon acceptance” and then “33% of estimate” to be paid “upon foundation work
completion”; another “33% of estimate” to be paid “upon completion of drywall”;
and the “[b]alance due” “upon completion” of the renovation.
The contract also includes a provision governing “[a]ny changes to the
scope of services” after the Grahams’ “acceptance of this estimate.” It requires
Bradshaw Renovations to email any such changes to the Grahams. And the
Grahams must “immediately inform Bradshaw Renovations, LLC in writing and via
email if the changes detailed are inaccurate.” If they fail to do so within three days
of receiving Bradshaw Renovations’ email, they are considered to have accepted
“the proposed changes detailed by Bradshaw Renovations.”
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The Project. Bradshaw Renovations soon began work on the Grahams’
home. In early September, Bradshaw Renovations emailed the Grahams a
revised estimate—increasing it by $3000 to $139,168.16 because of additional
required concrete work. And the Grahams responded the same day approving the
change. This was the only revised estimate sent by Bradshaw Renovations during
the project.
Despite the payment schedule set in the contract, Bradshaw Renovations
periodically sent the Grahams invoices for the work performed up to that time. The
invoices detailed specific labor and material expenses, some of which varied from
the estimate. And the Grahams made payments on the invoices promptly.
In November 2019, after paying the first two invoices totaling about $22,000,
the Grahams emailed Bradshaw Renovations first raising concerns about the
communications and billing practices: “At this point, we are worried we will go over
budget and need to make sure that we are communicating with one another each
step of the way to avoid any potential issues from forming.” They noted that “[a]
lot has changed in terms of weather, what people did incorrectly, and what you’ve
decided to change because of the weather.” And they asked “to see this in written
form so that we can approve of things, as per the terms of our written agreement.”
Bradshaw Renovations replied three days later, “I have not changed your
budget on the project since we have not made any cost changing decisions to this
point.” It also declined to give an updated estimate then, explaining that it only had
a concern about one line item for which there was an allowance and it “will address
[it] after I know what the expense incurred is.” Jacklynn Graham testified she
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remained in frequent contact with Bradshaw Renovations in person and via email
throughout the project and Bradshaw Renovations never said it was over budget.
In March 2020, Bradshaw Renovations emailed its fifth invoice, stating in
the cover email that “we are almost done.” That invoice brought the total billed by
Bradshaw Renovations on the project to $139,472.88—about $300 over Bradshaw
Renovations’ last estimate. Without complaint, the Grahams paid the “nice even
number” of $28,000 rather than the invoiced amount of $27,374.09—which brought
their total paid to Bradshaw Renovations up to $140,098.79. But then in May,
Bradshaw Renovations emailed the Grahams a “[f]inal bill” for $18,779.15.
This time, the Grahams responded in minutes with concerns that the invoice
was “exceptionally higher than what we talked about.” Later that day, they wrote
again explaining that they were starting to go “over line items” and were concerned
that Bradshaw Renovations had billed nearly $20,000 more than its last estimate
even though they had purchased their own flooring. And the Grahams expressed
their desire “to understand and see how this is possible as we didn’t do anything
in excess with regards to our estimate.” Over a series of emails, the Grahams
asked for and received additional information and over a hundred pages of
documentation from Bradshaw Renovations about all of its billing on their project.
A week after sending the final invoice, Bradshaw Renovations followed up
by email about “getting all this cleaned up.” Its owner “apologize[d] that I rushed
the bill over and made some mistakes, but I am wanting to see if we need to sit
down and go over items and clear up any confusion.” The Grahams responded
that the “charges are not making sense” and they were consulting an attorney
about the situation about “how to move forward.” They asked “[i]f there are
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invoices you are willing to reduce or waive” and said they would “need a couple
weeks to get back to you.” But Bradshaw Renovations, after expressing
disappointment and surprise, wrote back that it could “no longer communicate with”
the Grahams “directly” and would expect to hear from their attorney.
The Suit. A few months later, Bradshaw Renovations sued the Grahams
seeking payment for the final invoice under claims of breach of contract, unjust
enrichment, and quantum meruit. The Grahams then counterclaimed for breach
of contract and consumer fraud.1 Eventually, both parties’ breach-of-contract
claims and the Grahams’ consumer-fraud claim were tried to a jury over four days
in August 2022. Bradshaw Renovations’ unjust-enrichment and quantum-meruit
claims were left for decision by the court after the jury’s verdict and based on the
evidence submitted at trial.
At trial, the Grahams sought to recover a distinct set of damages for each
of their claims. On their breach-of-contract claim, they asked the jury to award
them about $24,000 in damages to remedy “improper work” performed by
Bradshaw Renovations under the contract. And on their consumer-fraud claim,
they argued that Bradshaw Renovations overbilled them by about $40,000—and
after subtracting out the amount they had not paid on the final invoice—asked for
an award of $22,468.91 in actual damages. They contended that the contract was
a time-and-materials contract and that Bradshaw Renovations misrepresented or
omitted material facts and engaged in deception or fraud on its invoices causing
1The Grahams also brought a separate proceeding under Iowa Code § 572.32(2)
to challenge a mechanic’s lien filed by Bradshaw Renovations over their payment
dispute. While the two cases were eventually consolidated, that challenge is not
at issue on appeal.
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them to pay more than the actual time and materials properly due under the
contract. For example, they pointed to:
• Roughly $24,000 in overbilled labor charges billed at $60 per hour rather
than the $45 per hour that Bradshaw Renovations had said it was
charging.
• Nearly $14,000 in overbilled subcontractor expenses and materials
above the amount actually spent by Bradshaw Renovations despite its
statement that it was taking “no profit” on “subs and materials.”
• An invoice including charges for a kitchen-sink faucet, estimated to be
about $100, that the Grahams actually purchased themselves.
The Grahams also sought treble statutory damages, urging that Bradshaw
Renovations’ conduct and lack of remorse showed that it “acted with willful and
wanton disregard for the rights of the Grahams” rather than “accident[ly].”
Bradshaw Renovations offered a contrary view of the evidence to the jury.
It argued that the contract was for a fixed fee—not a time-and-materials contract.
And it contended that its detailed descriptions of changed services on its periodic
invoices provided the Grahams notice of changes to the contract’s scope of
services that were accepted by the Grahams when they did not dispute the
changes in writing within three days. And so, Bradshaw Renovations claimed the
Grahams breached their contract when they failed to pay the final invoice, and it
thus asked to be awarded $18,779.15 in damages for that unpaid amount.
As for the Grahams’ breach-of-contract claim, Bradshaw Renovations did
not dispute that “some of this work” on the home “need[s to be] remedied.” Rather,
it questioned “what needs [to be] fixed and at what cost” and argued that because
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the Grahams failed to mitigate by addressing any defects sooner when costs were
lower, any damages should be reduced by twenty percent. And on the consumer-
fraud claim, Bradshaw Renovations argued that the Grahams had failed to show
any overbilling, material misrepresentations, or even any damages since the
contract was for a fixed rate. It also contended that the evidence of its cooperation
and answering of the Grahams’ billing questions showed it had no intent to defraud
them.
At the close of evidence, Bradshaw Renovations moved for a directed
verdict on the consumer-fraud claim. As relevant here, it argued the Grahams had
failed to present substantial evidence that they suffered actual damages, that
Bradshaw Renovations engaged in any prohibited practice under the statute, or
that its conduct was willful and wanton to support statutory damages. The district
court denied the motion, and the case was submitted to the jury.
The Decisions. The jury found that Bradshaw Renovations failed to prove
its breach-of-contract claim and found for the Grahams on both their claims. On
the Grahams’ breach-of-contract claim, the jury awarded $16,000 in damages.
And on their consumer-fraud claim, it awarded them $10,000 in actual damages
and $30,000 in statutory damages.
After the verdict, Bradshaw Renovations moved for judgment
notwithstanding the verdict and a new trial on the consumer-fraud claim. The
district court denied both motions. It held that substantial evidence supported the
verdict, reasoning that the Grahams had presented enough evidence for a jury to
find Bradshaw Renovations had improperly billed them more than $20,000 and
that the jury in fact had “awarded $10,000 in actual damages, apparently
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concluding some, but not all, of these alleged damages were caused by a violation
of the consumer fraud statute.” And on the new-trial motion, the court held that
Bradshaw Renovations had “not demonstrated an excessive jury verdict or one
that is not sustained by sufficient evidence or fails to do justice between the
parties.” The court again reasoned that the jury award for “less than what was
requested on both claims” helped show “that the jury was not influenced by passion
or prejudice.”
The Grahams also asked the court to award $54,791 in attorney fees—the
amount they incurred for the entire case—under the consumer-fraud statute’s
mandatory-attorney-fee provision. See Iowa Code § 714H.5(2). Bradshaw
Renovations resisted the amount of the request, arguing that they were only
entitled to fees on their consumer-fraud claim under the statute. And so, Bradshaw
Renovations urged the court to exclude some fees related to expert testimony that
had no relation to the consumer-fraud claim and to award only one-third of the
remaining request because there were two other claims (each party’s breach-of-
contract claim) for which the Grahams should not recover fees. In reply, the
Grahams did not offer a counterproposal on apportioning the fees and instead
maintained their argument that they should be able to recover all their fees.
The court accepted neither party’s proposed fee-award. While it agreed
with Bradshaw Renovations that the Grahams were limited to recovering on fees
related to the consumer-fraud claim and that $3055 in fees related to expert
testimony that had no relation to the consumer-fraud claim should be excluded, it
reduced the remaining fees by half rather than one-third. It reasoned that
considering the “common questions of law and fact . . . among the claims and the
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relationship” between the three claims, there were really only “two issues in the
case: billing practices and defective/incomplete work,” and so half of the fees were
fairly related to the consumer-fraud claim. The court thus awarded the Grahams
$25,868 in attorney fees.
Finally, the court dismissed Bradshaw Renovations’ unjust-enrichment and
quantum-meruit claims based on the evidence submitted at the jury trial. The court
found that the parties’ written contract covered the same subject matter as
Bradshaw Renovations’ implied-contract theories. Thus, the court reasoned that
“[t]he Parties contracted for a procedure to approve changes to the scope of work”
and “[t]o allow implied contract theories for an expanded scope of work would allow
a Party to avoid the procedure established by the contract in an effort to recover.”
The Appeal. Bradshaw Renovations appeals, arguing the district court
erred in denying its motions for judgment notwithstanding the verdict and for a new
trial on the consumer-fraud claim and in dismissing its unjust-enrichment and
quantum-meruit claims. The Grahams cross-appeal, arguing the court abused its
discretion in deciding the attorney-fees award. They also request appellate
attorney fees.
II. Consumer Fraud
Bradshaw Renovations focuses its appeal on four challenges to the jury
verdict on the consumer-fraud claim. First, it argues that the Grahams failed to
present any evidence to prove that they suffered an ascertainable loss due to the
alleged consumer fraud since they have paid no more than they originally
bargained under the renovation contract. Second, it argues that its conduct was
not a prohibited practice under the consumer-fraud statute. Third, it argues that
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there is no evidence of actual or legal malice necessary to support the award of
treble statutory damages. For any of these reasons, Bradshaw Renovations
contends the court erred in denying its motion for a judgment notwithstanding the
verdict. See Iowa R. Civ. P. 1.1003(2). And finally, it argues that the court should
have granted its motion for a new trial because “[t]he jury verdict failed to
administer substantial justice between the parties.”
Iowa’s Private Right of Action for Consumer Frauds Act authorizes “[a]
consumer who suffers an ascertainable loss of money or property as the result of
a prohibited practice or act in violation of [chapter 714H]” to “bring an action at law
to recover actual damages.” Iowa Code § 714H.5(1). A successful consumer may
also be awarded statutory damages of up to three times the actual damages by
showing the prohibited practice or act “constitutes willful and wanton disregard for
the rights or safety of another.” Id. § 714H.5(4). And a successful consumer
awarded actual damages is entitled to an award of reasonable attorney fees. See
id. § 714H.5(2).
We review the denial of a motion for judgment notwithstanding the verdict
for correction of errors at law. Carter v. Carter, 957 N.W.2d 623, 631 (Iowa 2021).
A motion for judgment notwithstanding the verdict must be granted if any one of
the claim’s elements is not supported by substantial evidence. Id. at 635.
“Evidence is substantial when a reasonable mind would accept it as adequate to
reach a conclusion.” Id. (cleaned up). We view the evidence in the light most
favorable to the nonmoving party, making all reasonable inferences a jury could
make. Id. “Evidence is not insubstantial merely because we may draw different
conclusions from it; the ultimate question is whether it supports the finding actually
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made, not whether the evidence would support a different finding.” State v. Lacey,
968 N.W.2d 792, 800–01 (Iowa 2021) (cleaned up).
Ascertainable Loss. Bradshaw Renovations first argues that the Grahams
failed to show they suffered “an ascertainable loss.” Iowa Code § 714H.5(1). It
relies on Poller v. Okoboji Classic Cars, LLC, 960 N.W.2d 496 (Iowa 2021), in
which the supreme court held that the plaintiffs had not suffered an ascertainable
loss from two consumer-fraud violations when they failed to present any evidence
that either violation caused them to spend more or receive less than they expected
to under their services agreement with the defendant.2 See id. at 522–24. The
violations there were of specific statutory requirements of the Motor Vehicle
Service Trade Practices Act related to providing advance estimates of costs or
completion and obtaining preapproval before performing certain services. See id.
at 523. And the plaintiffs failed to show “that they would have paid less than” the
$45,000 they did pay or “that they would not have approved the charges in
advance” if the violations had not occurred. Id.Bradshaw Renovations argues the Grahams similarly failed to show that
they paid any more—or received anything less—than they expected under their
home-renovation contract. At first blush, the argument has some appeal—the
Grahams did indeed pay a total of $140,098.79, while the revised contract estimate
2 The court did not precisely define “ascertainable loss.” Poller, 960 N.W.2d at
522–23. But it found “guidance for understanding the term” in slightly varying
interpretations by out-of-state courts that generally included the concepts that the
loss is “measurable” and involved “getting something less than you bargained for.”
Id. (cleaned up); see also Simonsen v. Sandy River Auto, LLC, 413 P.3d 982, 985
(Or. 2018); Discover Bank v. Morgan, 363 S.W.3d 479, 496 (Tenn. 2012);
Hinchliffe v. Am. Motors Corp., 440 A.2d 810, 814 (Conn. 1981).
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was about the same—$139,168.16. But the problem with the argument is that it
assumes the parties contracted for completion of the renovations at the fixed price
listed as the estimate—rather than a price tied in some way to the actual time and
materials used on the project. This was one of the key disputes between the
parties throughout the trial. And the jury could have agreed with the Grahams that
contract did not fix the price and that the Grahams thus had a contractual
expectation to pay a price lower than the estimate given Bradshaw Renovations’
actual time and materials costs. And so, the jury could have found that Bradshaw
Renovations’ billing practices—which the Grahams claimed were consumer fraud
that deceived them into paying more than the actual time and materials cost—
caused them to pay more than they expected under the contract.
Specifically, the Grahams argued that Bradshaw Renovations
misrepresented or omitted material facts and engaged in deception or fraud on its
invoices by billing $41,248.06 more than the actual time and materials properly
due under their contract. And factoring in the final $18,779.15 invoice that the
Grahams left unpaid, they claimed a loss of $22,468.91 from these practices. They
supported this claim with testimony and exhibits, including a detailed itemization
of twenty-seven instances of erroneous billings on the invoices. The jury awarded
about half the requested amount: $10,000 in actual damages. And two categories
of improper billings easily show losses supporting that award—even factoring in
the $18,799.15 billed amount the Grahams did not pay. First, the evidence that
Bradshaw Renovations overbilled roughly $24,000 in labor charges by billing at
$60 per hour rather than the $45 per hour that it said it was charging. And second,
the evidence that it overbilled nearly $14,000 in subcontractor expenses and
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materials above the amount it actually spent—despite its statement that it was
taking “no profit” on “subs and materials.”
We understand that Bradshaw Renovations continues to disagree with the
Grahams view of the facts. But we do not get to weigh the evidence anew on
appeal from a jury verdict. And it matters not whether substantial evidence could
have supported a contrary verdict too. See Lacey, 968 N.W.2d at 800–01. We
ask only whether a reasonable jury could have reached the verdict that this jury
did. See id.We also realize that there may be some tension between this view of the
evidence supporting the jury’s consumer-fraud verdict and the view that might best
support its breach-of-contract verdicts. But the parties only requested a general
verdict on each claim. So we do not know whether the jury found the contract to
be for a fixed price as we would if the parties had requested special verdicts or a
special interrogatory on that question. See Clinton Phys. Therapy Servs., P.C. v.
John Deere Health Care, Inc., 714 N.W.2d 603, 610–11 (Iowa 2006) (discussing
the distinctions between a “general verdict, special verdict, or general verdict with
special interrogatories,” including the role of special interrogatories in “test[ing] the
general verdict against the jury’s conclusions as to the ultimate controlling facts”
(cleaned up)); see also Iowa Rs. Civ. P. 1.932–1.934. And Bradshaw Renovations
did not challenge the verdicts as inconsistent in the district court, nor does it on
appeal. See Clinton Phys. Therapy, 714 N.W.2d at 611–14 (reviewing challenge
to inconsistent verdicts); Pavone v. Kirke, 801 N.W.2d 477, 496 (Iowa 2011)
(warning of the need to object to instructions and verdict form that “invite
inconsistent verdicts”). What’s more, only the consumer-fraud verdict is before
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us—Bradshaw Renovations did not appeal its adverse verdicts on either its or the
Grahams’ breach-of-contract claims. So we need not—indeed, cannot—consider
whether substantial evidence supports those breach-of-contract verdicts too.
Bottom line, because substantial evidence supports the jury’s finding that
the Grahams suffered an ascertainable loss of $10,000 in actual damages, we
affirm the district court’s denial of Bradshaw Renovations’ motion for judgment
notwithstanding the verdict on this ground.
Prohibited Practice. Bradshaw Renovations also argues the Grahams
failed to provide substantial evidence that it engaged in a prohibited practice under
the consumer-fraud statute. This statute prohibits a person from “engag[ing] in a
practice or act the person knows or reasonably should know is an unfair practice,
deception, fraud, false pretense, or false promise, or the misrepresentation,
concealment, suppression, or omission of a material fact, with the intent that others
rely upon the” act “in connection with the advertisement, sale, or lease of consumer
merchandise, or the solicitation of contributions for charitable purposes.” Iowa
Code § 714H.3(1).
The consumer-fraud statute applies to misrepresentations by home-
construction contractors like Bradshaw Renovations. See Scenic Builders, L.L.C.,
v. Peiffer, No. 10-0794, 2011 WL 2078225, at *2 (Iowa Ct. App. May 25, 2011).
And the same evidence of overbilling for labor, subcontractor, and materials that
supports the finding of an ascertainable loss also supports a finding that the
conduct is a prohibited practice. We need not define the precise boundaries of
each of the enumerated acts prohibited the statute because the jury could have
found that Bradshaw Renovations made knowing misrepresentations and
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omissions of material facts in its itemized invoices with the intent that the Grahams
rely on them by making payments above what they properly owed under the
contract. And this is well within the heartland of the consumer-fraud statute.
Bradshaw Renovations’ argument on appeal essentially challenges the
weight of this evidence, arguing the Grahams’ evidence is not credible. But under
substantial-evidence review, “[o]ur task is not to weigh the evidence or the
credibility of the witnesses. Rather, our task is to determine whether substantial
evidence supports the district court’s findings according to those witnesses whom
the court believed.” Tim O’Neill Chevrolet, Inc. v. Forristall, 551 N.W.2d 611, 614
(Iowa 1996) (cleaned up); see also State v. Thornton, 498 N.W.2d 670, 673 (Iowa
1993) (“The jury is free to believe or disbelieve any testimony as it chooses and to
give weight to the evidence as in its judgment such evidence should receive.”).
The district court did not err in holding that substantial evidence supports the jury’s
finding that Bradshaw Renovations engaged in a prohibited practice.
Statutory Damages. Bradshaw Renovations next argues the evidence
cannot support the jury’s award of $30,000 in statutory damages. A jury may
award statutory damages of up to three times the actual damages if it finds “by a
preponderance of clear, convincing, and satisfactory evidence that a prohibited
practice or act in violation of [chapter 714H] constitutes willful and wanton
disregard for the rights or safety of another.” Iowa Code § 714H.5(4). No appellate
court has yet considered whether substantial evidence supports an award of
statutory damages under section 714H.5(4) since its enactment in 2009. Cf.
Calderon v. Khan, No. 20-0489, 2021 WL 3896892, at *4 (Iowa Ct. App. Sept 1,
2021) (holding that challenge to denial of statutory damages under
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section 714H.5(4) was waived by insufficient appellate briefing); Poller, 960
N.W.2d at 524 (holding that statutory damages were unavailable when there is “no
ascertainable loss” but also noting that the technical violations found there as a
matter “of first impression in Iowa” could not “amount to willful and wanton” conduct
supporting an award).
But the text of the consumer-fraud statutory damages provision is nearly
identical to our general punitive-damages statute and covers a similar subject.
Compare Iowa Code § 714H.5(4), with id. § 668A.1(1)(a) (authorizing punitive or
exemplary damages only if, “by a preponderance of clear, convincing, and
satisfactory evidence, the conduct of the defendant from which the claim arose
constituted willful and wanton disregard for the rights or safety of another”). The
meaning of the general punitive-damages statute is well developed. So we look
to the precedent interpreting that statute when applying the same text in this
statute. See State v. McPhillips, 580 N.W.2d 748, 755 (Iowa 1998) (looking to
precedent “interpreting identical language in a similar statute”); Antonin Scalia &
Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 172–73 (2012);
see also Calderon, 2021 WL 3896892, at *4 (citing punitive-damages precedent to
interpret section 714H.5(4)).
The supreme court has explained that “conduct is ‘willful and wanton’ when
the actor has intentionally done an act of unreasonable character in disregard of a
known or obvious risk that was so great as to make it highly probable that harm
would follow, and which thus is usually accompanied by a conscious indifference
to the consequences.” Miranda v. Said, 836 N.W.2d 8, 34 (Iowa 2013) (cleaned
up). While “mere negligent” or “objectionable conduct” alone does not meet this
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standard, “persistent” reckless conduct can. Cawthorn v. Cath. Health Initiatives
Iowa Corp., 743 N.W.2d 525, 529 (Iowa 2007) (cleaned up); see also Miranda, 836
N.W.2d at 34 (finding substantial evidence to infer recklessness supporting
punitive damages). Put another way, consumer-fraud statutory damages are
proper if the jury could find Bradshaw Renovations engaged in “wrongful conduct
. . . with a . . . reckless disregard for the rights of” the Grahams.3 Cawthorn, 743
N.W.2d at 529.
Bradshaw Renovations argues that its conduct does not meet this standard
mainly by reiterating its previous arguments—that the Grahams suffered no loss
because they “paid what they expected,” that “t]hey did not overpay,” and “[a]ny
errors in billing were minor.” But again, Bradshaw Renovations asks us to accept
its view of the evidence when that is not the only reasonable conclusion that could
be drawn from the evidence. The jury was aware of the parties’ different views of
the evidence—the Grahams’ attorney highlighted the nub of the question in his
closing argument about statutory damages: “Was it all an accident, [a] big
accident, or was it willful? You got to decide that based on all the evidence.” So
while the jury could have believed Bradshaw Renovations’ explanations, it did not.
Rather, it found the Grahams’ view of the evidence more credible. Given
the ten months of Bradshaw Renovations’ interactions with the Grahams, and five
invoices containing itemizations of costs that the jury could have found were false,
the jury could have found that Bradshaw Renovations engaged in a persistent
3 The supreme court has also recognized that willful and wanton conduct “may be
shown by such things as personal spite, hatred, or ill-will,” often referred to as
“actual malice.” Cawthorn, 743 N.W.2d at 529 (citation omitted). But the Grahams
have not advanced such a theory of the evidence here.
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course of wrongful conduct that financially harmed the Grahams—recklessly
disregarding the Grahams’ rights under the contract. See Miranda, 836 N.W.2d
at 34–35 (holding that evidence “support[ing] a deductive inference that [the
defendant] lied” provided substantial evidence of willful and wanton conduct).
Giving proper deference to the jury’s role, the evidence here is enough to impose
statutory damages. The district court did not err in denying Bradshaw’s motion for
judgment notwithstanding the verdict on this final ground either.
Motion for a New Trial. Bradshaw Renovations’ last try to overcome the
jury verdict is that the district court should have granted a new trial because the
“verdict failed to administer substantial justice between the parties.” While this is
not a ground for a new trial under Iowa Rule of Civil Procedure 1.1004, our
supreme court has “long recognized a trial court has inherent power to grant a new
trial” on this basis. Crow v. Simpson, 871 N.W.2d 98, 108 (Iowa 2015). But “the
reason the verdict fails to administer substantial justice must be apparent in the
record.” Id. And it is not enough merely that the court “would have reached a
different result.” Id. Still, the “district court has broad discretion in deciding whether
to grant or deny a new trial” on this ground. Id. And we will reverse only for an
abuse of that discretion. See id. at 105.
The district court did not abuse its discretion in denying the motion for a new
trial. Bradshaw Renovations makes only a cursory contrary argument on appeal,
reiterating in one sentence the same contentions already discussed that the
“Graham[s] do[] not have an ascertainable loss and there is not clear, convincing
and satisfactory evidence Bradshaw [Renovations] engaged in willful and wanton
conduct justifying treble damages.” But we have already found those contentions
20
lacking to support a judgment notwithstanding a verdict. And we cannot say that
the district court abused its broad discretion in deciding that no failure to administer
substantial justice was apparent from this record. We thus affirm the district court’s
denial of the motion for a new trial.
III. Unjust Enrichment and Quantum Meruit
Bradshaw Renovations also argues that despite the jury’s rejection of its
breach-of-contract claim seeking payment on an unpaid invoice for the renovation,
the district court should have ruled in its favor on its alternative equitable claims of
unjust enrichment and quantum meruit for the same unpaid invoice. The parties
agree that these claims were tried to the court in equity, so our review is de novo.
See Homeland Energy Sols., LLC v. Retterath, 938 N.W.2d 664, 684 (Iowa 2020).
We give weight to the district court’s findings of fact, but we are not bound by them.
See Iowa R. Civ. P. 6.904(3)(g).
“The doctrines of unjust enrichment and quantum meruit are based upon
the concept of implied contract.” Kunde v. Est. of Bowman, 920 N.W.2d 803, 807
(Iowa 2018). “An express contract and an implied contract cannot coexist with
respect to the same subject matter, and the former supersedes the latter.” Legg
v. W. Bank, 873 N.W.2d 763, 771 (Iowa 2016) (cleaned up). Although “implied
contract theories may coexist with written contracts, the cases involve situations
where recovery was sought for matters not covered or agreed upon in the contract,
or where a contract does not address a particular term that the facts and
circumstances suggest should be supplied by implication.” Kunde, 920 N.W.2d at
807 (cleaned up).
21
Bradshaw Renovations concedes that the parties had a written contract for
renovation of the Grahams’ home. But it argues that the scope of the renovation
expanded beyond that described in the contract and it is thus entitled to equitable
recovery for its work outside the contract. To support its argument, Bradshaw
Renovations relies on our decision in Nepstad Custom Homes Co. v. Krull, 527
N.W.2d 402 (Iowa Ct. App. 1994). There, in considering a breach-of-contract
claim—rather than quantum meruit or unjust enrichment—we said in dicta that “a
builder may recover from an owner for extras ordered or agreed upon which were
not covered by the contract.” Id. at 407. But all we held—ruling against the builder
who had appealed—was that the items it “claimed were extras were actually
agreed to prior to the execution of the contract” and the district court thus properly
awarded damages to the homeowner for the builder’s failure to provide them. Id.And the contract there did not have a provision expressly setting a process for
adding on “extras” or otherwise changing the scope of work. See id. at 405.
But here we do have such a provision. As the district court found, the parties
contracted for a major renovation of the Grahams’ home with a provision for
changing the scope of the work. Bradshaw Renovations’ failure to follow the
contractual process to change the scope of work does not take its additional work
outside the subject matter of the contract. See Kunde, 920 N.W.2d at 808 (finding
“the parties entered into an express written agreement related to the farmland
improvements” and the contractor cannot “use theories of unjust enrichment and
quantum meruit to recover for improvements to which he was plainly not entitled
under the terms of the contract”). Because all of Bradshaw Renovations’ work on
the Grahams’ home was within the subject matter of the contract, Bradshaw
22
Renovations cannot recover for its claims of unjust enrichment and quantum
meruit. We thus affirm the district court’s dismissal of these claims.
IV. Cross-Appeal of Attorney-Fee Award
The Grahams cross-appeal, arguing the district court should have awarded
them $1865.75 more in attorney fees on their consumer-fraud claim. They
originally requested $54,791 in attorney fees—the amount spent litigating the
entire case. But the district court awarded $25,868—the amount it calculated was
reasonably related to the consumer-fraud claim—because the Grahams based
their request on Iowa Code section 714H.5(2), which authorizes an award of
reasonable attorney fees in a successful consumer-fraud action. See Lee v. State,
874 N.W.2d 631, 649 (Iowa 2016) (holding that when attorney fees are available
for only some claims in the proceeding, the court may award any fees “involving a
common core of facts or based on related legal theories” (cleaned up)). The court
calculated this amount by removing $3055 in fees related to expert testimony that
had no relation to the consumer-fraud claim and then awarded half of the
remaining amount for the “general time entries that are not clearly applicable to a
specific claim.”
The Grahams’ argument on appeal is narrow. They do not challenge the
district court’s general analysis. Rather, they point to $3731.50 in fees for legal
services that they contend are “directly applicable” to the consumer-fraud claim
and should thus be paid in full rather than split in half as general time entries. And
so, they ask us to increase the award by $1865.75—the other half of the amount
that the district court did not award for these services.
23
But “[i]t is a fundamental doctrine of appellate review that issues must
ordinarily be both raised and decided by the district court before we will decide
them on appeal.” Meier v. Senecaut, 641 N.W.2d 532, 537 (Iowa 2002). This
gives the district court a chance to correct the error itself “at a time when corrective
action can be taken.” In re Marriage of Heiar, 954 N.W.2d 464, 470 (Iowa Ct. App.
2020) (cleaned up). It “preserve[s] judicial resources by avoiding proceedings that
would have been rendered unnecessary had an earlier ruling on the issue been
made.” Top of Iowa Co-op v. Sime Farms, Inc., 608 N.W.2d 454, 470 (Iowa 2000).
And it ensures that we act as a court of appeals, reviewing a decision already made
by the district court rather than considering it for the first time on appeal.4 See
Meier, 641 N.W.2d at 537.
The Grahams did not argue in the district court that these $3731.50 in
attorney fees were “for work directly applicable to” their consumer-fraud claim.
There, they staked their claim solely on an argument that their entire amount was
reasonable and authorized under Iowa Code section 714H.5(2) because the
multiple claims were “inextricably intertwined.” But they do not continue to pursue
that broader argument on appeal. And even after the court rejected their argument
and apportioned the fees, they did not raise this issue through a motion to
reconsider or enlarge to give the district court the chance to address it. See Iowa
4 We recognize that Bradshaw Renovations did not address error preservation and
concedes that part of the disputed fees relate to the consumer-fraud claim. But
the error-preservation requirement protects more “than simply the interests of the
opposing party.” Top of Iowa Co-op, 608 N.W.2d at 470. So we consider whether
error is preserved even when it has been ignored—or conceded—by the opposing
party on appeal to protect all the interests it serves. See id.; State v. Bergmann,
633 N.W.2d 328, 332 (Iowa 2001) (“Although the State concedes that error has
been preserved . . . , we disagree.”).
24
R. Civ. P. 1.904(2). So they have failed to preserve this claim of error for our
review. And because they raise no other challenge to the award, we affirm.
V. Appellate Attorney Fees
The Grahams request appellate attorney fees. Because the Grahams
prevailed on their consumer-fraud claim, appellate attorney fees are mandatory.
See Iowa Code § 714H.5(2) (“If the court finds that a person has violated [chapter
714H] and the consumer is awarded actual damages, the court shall award . . . to
the consumer’s attorney reasonable fees.” (emphasis added)). The Grahams did
not request any specific amount of fees, nor did they submit an attorney-fee
affidavit for us to determine the amount of reasonable appellate attorney fees. See
In re Marriage of Samuels da Fonseca Silva, No. 23-0685, 2024 WL _____, at *__
(Iowa Ct. App. Oct. 2, 2024). We thus remand the case to the district court with
directions to decide the amount of the award for reasonable attorney fees
attributable only to defending the consumer-fraud verdict on appeal. See id.AFFIRMED ON APPEAL AND CROSS-APPEAL AND REMANDED WITH
DIRECTIONS.