Bloedorn Lumber Co. v. Nielson ( 2018 )

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www.nebraska.gov/apps-courts-epub/
09/07/2018 01:09 AM CDT
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Nebraska Supreme Court A dvance Sheets
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BLOEDORN LUMBER CO. v. NIELSON
Cite as 300 Neb. 722Bloedorn Lumber Company of North Platte,
a Nebraska corporation, appellee, v. Jarrod
M. Nielson, appellee, and David A. Schilke
and Candace Schilke, appellants.
___ N.W.2d ___
Filed August 10, 2018. No. S-16-329.
1 Breach of Contract: Damages. A suit for damages arising from breach
of a contract presents an action at law.
2. Contracts: Restitution. Any quasi-contract claim for restitution is an
action at law.
3. Judgments: Appeal and Error. In a bench trial of a law action, the trial
court’s factual findings have the effect of a jury verdict and will not be
disturbed on appeal unless clearly wrong.
4. ____: ____. In reviewing a judgment awarded in a bench trial of a law
action, an appellate court does not reweigh evidence, but considers the
evidence in the light most favorable to the successful party and resolves
evidentiary conflicts in favor of the successful party, who is entitled to
every reasonable inference deducible from the evidence
5. Venue: Appeal and Error. Where the record does not show an abuse of
discretion, a ruling on a motion to transfer venue will not be disturbed
on appeal.
6. Jurisdiction: Appeal and Error. Before reaching the legal issues
presented for review, it is the duty of an appellate court to determine
whether it has jurisdiction over the appeal.
7. Jurisdiction: Final Orders: Appeal and Error. For an appellate court
to acquire jurisdiction over an appeal, there must be a final order or final
judgment entered by the court from which the appeal is taken.
8. Judgments: Final Orders: Words and Phrases. A final judgment is
one that disposes of the case either by dismissing it before hearing is
had upon the merits, or after trial by rendition of judgment for the plain-
tiff or defendant.
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BLOEDORN LUMBER CO. v. NIELSON
Cite as 300 Neb. 7229. Contracts: Unjust Enrichment: Quantum Meruit. A claim that a
court should imply a promise or obligation to prevent unjust enrichment
goes by a number of names—“quasi-contract,” “implied-in-law con-
tract,” or “quantum meruit.”
10. Contracts. An express contract claim will supersede a quasi-contract
claim arising out of the same transaction to the extent that the contract
covers the subject matter underlying the requested relief.
11. Contracts: Liens. A party may pursue and recover on an unjust enrich-
ment or a quasi-contract claim, notwithstanding a construction lien.
12. Judgments: Words and Phrases. An abuse of discretion occurs when a
trial court’s decision is based upon reasons that are untenable or unrea-
sonable or if its action is clearly against justice or conscience, reason,
and evidence.
Appeal from the District Court for Lincoln County: Donald
E. Rowlands, Judge. Affirmed.
Patrick M. Heng and Kortnei N. Hoeft, of Waite, McWha &
Heng, for appellants.
George E. Clough, and, on brief, Andrea Finegan
McChesney, of McChesney & Farrell, for appellee Bloedorn
Lumber Company of North Platte.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, and
Papik, JJ., and Daugherty, District Judge.
Papik, J.
Jarrod M. Nielson alleged that David A. Schilke and Candace
Schilke failed to pay him for work he performed on their resi-
dence. Following a bench trial, the district court entered judg-
ment in favor of Nielson and against the Schilkes. The Schilkes
raise various assignments of error regarding that judgment on
appeal, but we find no merit to those assignments of error and,
consequently, affirm the judgment of the district court.
BACKGROUND
Project.
This dispute arises out of a home improvement project.
In 2013 and 2014, Nielson worked on an addition to the
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BLOEDORN LUMBER CO. v. NIELSON
Cite as 300 Neb. 722Schilkes’ home. The project included the installation of granite
countertops. Nielson obtained the countertops and accompa-
nying materials from Bloedorn Lumber Company of North
Platte (Bloedorn).
After the countertops were installed in May 2014, Nielson
stopped working on the Schilkes’ home. The parties dispute the
reason Nielson stopped working. The Schilkes say they fired
Nielson because they were unhappy with his work. In par-
ticular, Candace Schilke testified that the countertops Nielson
had installed contained a type of sink other than the one
she requested and had seams that were “sticking up and
out.” Nielson says he stopped working because he was not
being paid.
Both Nielson and Bloedorn eventually filed construction
liens on the Schilkes’ home. Neither Nielson nor Bloedorn
instituted legal proceedings to enforce the liens.
Parties’ Claims.
In February 2015, Bloedorn filed a complaint against Nielson
and the Schilkes in the district court for Lincoln County.
Bloedorn alleged that Nielson had ordered and received the
countertops and accompanying materials from Bloedorn for
installation in the Schilkes’ home, but had not paid Bloedorn.
Nielson and the Schilkes answered Bloedorn’s lawsuit, but
also filed cross-claims against each other. Nielson alleged that
the parties entered into an oral agreement in which Nielson
would build an addition onto the Schilkes’ home in exchange
for payment and that the Schilkes breached that agreement
by failing to pay him for his time and the materials. Nielson
also alleged that the Schilkes had been unjustly enriched as a
result of the countertops’ being installed without payment. The
Schilkes alleged that they contracted with Nielson to complete
construction work on their residence and that they had paid
Nielson all he was owed, but that Nielson had failed to pay
Bloedorn for the construction materials. On the basis of these
facts, the Schilkes asserted that Nielson was liable to them for
fraud and unjust enrichment.
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BLOEDORN LUMBER CO. v. NIELSON
Cite as 300 Neb. 722Motion to Transfer Venue.
Early in the case, the Schilkes filed a motion to transfer
venue from the district court for Lincoln County to the district
court for Chase County. They argued that transfer was appro-
priate because their residence is in Chase County. The district
court overruled the motion, finding that venue was present in
Lincoln County on the basis of Nielson’s residence there. It
added that any inconvenience suffered by the Schilkes was off-
set by the inconvenience Nielson and Bloedorn would endure
if the case were transferred to Chase County.
District Court’s Resolution
of Parties’ Claims.
A bench trial was held in January 2016. Bloedorn presented
evidence that it provided Nielson with the countertops and
accompanying materials for installation in the Schilkes’ resi-
dence. Nielson testified that the Schilkes were to pay him for
the cost of materials plus a markup. Nielson acknowledged
his debt to Bloedorn for the countertops and accompanying
materials. The testimony conflicted, however, as to whether
the Schilkes had paid Nielson for the installation of the
countertops. Candace Schilke testified that she paid Nielson
for the installation of the countertops via a $30,000 check
before they were installed. Nielson disagreed, taking the posi-
tion that the $30,000 check was in payment for other work
and materials.
After the trial, the district court issued a judgment, styled
as a journal entry and order, disposing of the parties’ various
claims. With respect to Bloedorn’s claim against Nielson, the
court entered judgment in favor of Bloedorn in the amount
of $11,551.89 (the cost of the countertops and accompany-
ing materials), plus statutory interest. The court dismissed
Bloedorn’s claim against the Schilkes, explaining that there
was no agreement between the Schilkes and Bloedorn which
would support a breach of contract claim and that the Schilkes
were not unjustly enriched at Bloedorn’s expense. The district
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BLOEDORN LUMBER CO. v. NIELSON
Cite as 300 Neb. 722court also dismissed the Schilkes’ cross-claim against Nielson
on the grounds that Nielson was not unjustly enriched and that
there was no evidence Nielson had committed actual or con-
structive fraud.
Finally, the district court found that Nielson’s claim against
the Schilkes “ha[d] merit.” It explained that Nielson installed
the countertops in the Schilkes’ residence and that Candace
Schilke admitted that the countertops increased the value of the
residence. The court added that while the Schilkes had com-
plaints about the quality of Nielson’s work, no evidence had
been introduced as to the cost of remedying alleged defects or
that the defects decreased the value of the home. The district
court awarded Nielson $11,551.89, which the court found was
the “fair and reasonable amount that the Schilkes have been
unjustly enriched.” The district court made no reference to
Nielson’s allegation that the Schilkes breached their agreement
with him.
The Schilkes later filed a motion for a new trial. The district
court overruled the motion, and the Schilkes appealed.
ASSIGNMENTS OF ERROR
The Schilkes assign, consolidated and reordered, that the
district court erred (1) in finding that Nielson was entitled to
recover under the theory of unjust enrichment when a contract
existed between the parties, (2) in finding that Nielson was
entitled to recover under the theory of unjust enrichment when
Nielson had a statutory remedy of foreclosure on his construc-
tion lien, (3) in finding that Nielson was entitled to recover
under the theory of unjust enrichment when the evidence did
not show the Schilkes were unjustly enriched, and (4) in deny-
ing the motion to transfer venue.
STANDARD OF REVIEW
[1,2] A suit for damages arising from breach of a con-
tract presents an action at law. Par 3, Inc. v. Livingston, 268
Neb. 636, 686 N.W.2d 369 (2004). The same is true for any
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Cite as 300 Neb. 722action asserting a quasi-contract claim for restitution. City of
Scottsbluff v. Waste Connections of Neb., 282 Neb. 848, 809
N.W.2d 725 (2011).
[3,4] In a bench trial of a law action, the trial court’s fac-
tual findings have the effect of a jury verdict and will not be
disturbed on appeal unless clearly wrong. Id. In reviewing a
judgment awarded in a bench trial of a law action, an appellate
court does not reweigh evidence, but considers the evidence in
the light most favorable to the successful party and resolves
evidentiary conflicts in favor of the successful party, who
is entitled to every reasonable inference deducible from the
evidence. Hooper v. Freedom Fin. Group, 280 Neb. 111, 784
N.W.2d 437 (2010).
[5] Where the record does not show an abuse of discretion,
a ruling on a motion to transfer venue will not be disturbed on
appeal. Community First State Bank v. Olsen, 255 Neb. 617,
587 N.W.2d 364 (1998).
ANALYSIS
Appellate Jurisdiction.
[6] Before reaching the legal issues presented for review, it
is the duty of an appellate court to determine whether it has
jurisdiction over the appeal. In re Estate of Abbot-Ochsner,
299 Neb. 596, 910 N.W.2d 504 (2018). While not raised
by either of the parties, we stop to address our jurisdiction
because, at first blush, it could appear that the district court
did not resolve all claims presented. Although Nielson referred
to both breach of contract and unjust enrichment in his cross-
claim against the Schilkes, the district court made no reference
to Nielson’s breach of contract theory of recovery.
[7,8] For an appellate court to acquire jurisdiction over
an appeal, there must be a final order or final judgment
entered by the court from which the appeal is taken. Ginger
Cove Common Area Co. v. Wiekhorst, 296 Neb. 416, 893
N.W.2d 467 (2017). A final judgment is one that disposes of
the case either by dismissing it before hearing is had upon
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BLOEDORN LUMBER CO. v. NIELSON
Cite as 300 Neb. 722the merits, or after trial by rendition of judgment for the plain-
tiff or defendant. Boyd v. Cook, 298 Neb. 819, 906 N.W.2d
31 (2018).
While the district court’s judgment did not reference
Nielson’s allegation that the Schilkes breached their contract
with him, it does not automatically follow that the judgment
was not final. Nielson’s cross-claim asserted two separate
theories of recovery—unjust enrichment and breach of con-
tract. Because those theories of recovery are based on the same
operative facts, however, Nielson asserted one cause of action.
See Poppert v. Dicke, 275 Neb. 562, 747 N.W.2d 629 (2008).
The district court awarded judgment in favor of Nielson on his
one cause of action against the Schilkes and also resolved all
claims raised by other parties in the action. Nothing further
was left for the court’s consideration. The judgment was thus
final and appealable.
Effect of Express Contract on
Unjust Enrichment Recovery.
We begin our analysis of the merits of the Schilkes’ appeal
with their contention that the district court erred by granting
Nielsen a recovery on the basis of unjust enrichment when
the parties had an express contract covering the same subject
matter. As noted above, the district court entered judgment in
favor of Nielson on unjust enrichment grounds without explic-
itly referring to Nielson’s allegation that the Schilkes had
breached their contract with him.
[9] Before addressing this argument, we pause briefly to
review the nature of unjust enrichment claims and their rela-
tionship to claims for breach of contract. A claim that a court
should imply a promise or obligation to prevent unjust enrich-
ment goes by a number of names—“quasi-contract,” “implied-
in-law contract,” or “quantum meruit.” See, City of Scottsbluff
v. Waste Connections of Neb., 282 Neb. 848, 809 N.W.2d 725(2011); Associated Wrecking v. Wiekhorst Bros., 228 Neb.
764, 424 N.W.2d 343 (1988). Such claims do not arise from
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BLOEDORN LUMBER CO. v. NIELSON
Cite as 300 Neb. 722an express or implied agreement between the parties; rather,
they are imposed by law “when justice and equity require the
defendant to disgorge a benefit that he or she has unjustifiably
obtained at the plaintiff’s expense.” City of Scottsbluff v. Waste
Connections of Neb., 282 Neb. at 857, 809 N.W.2d at 738.
[10] Unjust enrichment or quasi-contract claims are viable
only in limited circumstances. For example, as the Schilkes
correctly point out, “‘[t]he terms of an enforceable agreement
normally displace any claim of unjust enrichment within their
reach.’” Id. at 860, 809 N.W.2d at 740, quoting Restatement
(Third) of Restitution and Unjust Enrichment § 2, comment
c. (2011). Put another way, an express contract claim will
supersede a quasi-contract claim arising out of the same trans-
action to the extent that the contract covers the subject matter
underlying the requested relief. See City of Scottsbluff v. Waste
Connections of Neb., supra.
Although contract claims supersede unjust enrichment or
quasi-contract claims, a plaintiff is permitted to allege both.
See Professional Recruiters v. Oliver, 235 Neb. 508, 456
N.W.2d 103 (1990). When a plaintiff does so, we have said
that a court should address the contract claim first. See City of
Scottsbluff v. Waste Connections of Neb., supra. But if recovery
on an express contract theory proves not to be viable, there are
circumstances in which recovery may still be had on an unjust
enrichment or a quasi-contract basis.
One such circumstance is when a party seeking payment
only partially (but not substantially) performs a contract and
is thus precluded from a breach of contract recovery. See RM
Campbell Indus. v. Midwest Renewable Energy, 294 Neb. 326,
886 N.W.2d 240 (2016) (explaining that to successfully bring
breach of contract action, plaintiff must establish substantial
performance of contract). We have held that if a party only
partially performs a contract and the other party has accepted
and retained the benefits thereof, the party seeking payment
may recover “the reasonable or fair value of such performance,
subject to the reciprocal right of the other party to recoup such
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Cite as 300 Neb. 722damages as he or she has suffered” from the failure to perform.
Id. at 342, 866 N.W.2d at 255. See, also, Peters v. Halligan,
182 Neb. 51, 60, 152 N.W.2d 103, 109 (1967) (characterizing
recovery that is available for party who partially performs con-
tract when other party has retained benefits thereof as being on
“a quantum meruit basis”).
The foregoing discussion is relevant because there is evi-
dence in the record that this very scenario occurred here. Both
Nielson and the Schilkes alleged and introduced evidence
of an oral agreement that Nielson would have granite coun-
tertops installed in exchange for payment, which, accord-
ing to Nielson, was to include a markup for materials. And
while Candace Schilke testified that the countertops had visible
seams “sticking up and out” and contained a type of sink other
than the one she requested, she also admitted that Nielson had
the countertops installed and that they increased the value of
the residence.
This evidence would allow the district court to reasonably
conclude that Nielson had partially performed the parties’
agreement and was thus entitled to receive the reasonable value
of the benefits he conferred on the Schilkes. Because we find
that the district court’s judgment in favor of Nielson on unjust
enrichment grounds is supported by the evidence, the Schilkes’
assignment of error fails.
Effect of Construction Lien on
Unjust Enrichment Recovery.
The Schilkes fare no better with their argument that the trial
court erred by awarding Nielson an unjust enrichment recovery
when he could have foreclosed on his construction lien. Here,
the Schilkes contend that because Nielson had the option to
pursue foreclosure of his construction lien, he could not val-
idly recover on an unjust enrichment or a quasi-contract basis.
We disagree.
In Tilt-Up Concrete v. Star City/Federal, 261 Neb. 64,
621 N.W.2d 502 (2001), it was argued that the Nebraska
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Cite as 300 Neb. 722Construction Lien Act precluded a construction lienholder from
pursuing an action for breach of contract. We rejected the
argument, relying on a rule recognized in many other jurisdic-
tions that unless otherwise provided by statute, the remedy
for a mechanic’s lien and the remedy for the underlying debt
may be pursued at the same time or in succession. We pointed
out that this rule is consistent with the principle that a statute
will not be interpreted to restrict or remove a common-law
right unless plainly compelled by the language, because the
Nebraska Construction Lien Act does not indicate that it pre-
cludes a breach of contract action.
[11] While Tilt-Up Concrete held that a party may pursue a
breach of contract action notwithstanding a construction lien,
its reasoning indicates that a party may also pursue and recover
on an unjust enrichment or a quasi-contract claim, notwith-
standing a construction lien. The right to an unjust enrichment
or a quasi-contract recovery also existed at common law, see
Restatement (First) of Contracts § 5, comment a. (1932), and
the Nebraska Construction Lien Act does not indicate that it
was meant to preclude such claims. We thus join other courts
that have held that the existence of a construction lien does
not preclude an unjust enrichment or a quasi-contract recovery
for work or materials covered by the lien. See, e.g., Brown
Sprinkler Corp. v. Somerset-Pulaski, 335 S.W.3d 455 (Ky. App.
2010); Morris Pumps v. Centerline Piping, 273 Mich. App.
187, 729 N.W.2d 898 (2006); A-Tech Concrete Co. v. West
Orange Public Schools, No. L-6044-05, 2008 WL 4057750(N.J. Super. Sept. 3, 2008) (unpublished opinion).
Because Nielson’s filing of a construction lien does not pre-
clude an unjust enrichment recovery, the Schilkes’ assignment
of error lacks merit.
Evidence to Support Unjust
Enrichment Recovery.
We must also disagree with the Schilkes’ contention that
Nielson failed to show that the Schilkes had been unjustly
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Cite as 300 Neb. 722enriched. The Schilkes contend that they were not unjustly
enriched for two reasons: because Nielson did not transfer
any benefit to them and because they paid Nielson for the
countertops.
With respect to the Schilkes’ first contention, the evidence
shows that Nielson acted as the Schilkes’ contractor, arranged
for the installation of the countertops, and incurred a debt to
Bloedorn for the cost of the countertops. The evidence also
shows that the countertops increased the value of the Schilkes’
residence. The Schilkes are mistaken that Nielson did not
transfer any benefit to them.
With respect to the Schilkes’ argument that they paid
Nielson for the countertops, the Schilkes point to Candace
Schilke’s testimony that she intended to pay for the coun-
tertops with the $30,000 check referenced above. At most,
however, this merely establishes a conflict in the evidence.
Nielson testified that he was not paid for the countertops.
We must resolve any such conflicts in favor of Nielson and
give Nielson every reasonable inference deducible from the
evidence. See Henton v. Nokes, 258 Neb. 230, 603 N.W.2d
1 (1999). Under this standard, we cannot say that the trial
court clearly erred by finding that Nielson was not paid for
the countertops.
Motion to Transfer Venue.
This leaves only the Schilkes’ assignment that the district
court erred in denying their motion to transfer venue to Chase
County. We find that it did not.
[12] As noted above, a ruling on a motion to transfer venue
will not be disturbed on appeal unless the record shows an
abuse of discretion. Community First State Bank v. Olsen,
255 Neb. 617, 587 N.W.2d 364 (1998). An abuse of discre-
tion occurs when a trial court’s decision is based upon reasons
that are untenable or unreasonable or if its action is clearly
against justice or conscience, reason, and evidence. Lombardo
v. Sedlacek, 299 Neb. 400, 908 N.W.2d 630 (2018).
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Cite as 300 Neb. 722Here, the district court overruled the Schilkes’ motion to
transfer venue on the ground that any inconvenience suffered
by the Schilkes by allowing the case to proceed in Lincoln
County was offset by the inconvenience that would be caused
to Nielson and Bloedorn if the case were transferred to Chase
County. We find the court’s reasoning sound and certainly not
an abuse of discretion.
CONCLUSION
Finding no merit in any of the assignments of error raised by
the Schilkes, we affirm.
A ffirmed.