Opinion
HHDCV146048285
07-13-2017
J.D.C. Enterprises, Inc. v. Sarjac Partners, LLC
UNPUBLISHED OPINION
MEMORANDUM OF DECISION
Nina F. Elgo, J.
The plaintiff, J.D.C. Enterprises, Inc. (JDC), brought this lawsuit against the defendant, Sarjac Partners, LLC (Sarjac), alleging breach of contract, quantum merit, and unjust enrichment. JDC provided remediation services following significant flooding in the interior basement of Sarjac's property on 36 LaSalle Road in West Hartford (property). Because Sarjac has failed to pay for these services, JDC seeks damages in the amount of $169,414.34.
Following its receipt of evidence in a trial before this court on December 7 and December 8, 2016 and trial briefs filed by the parties, this court outlines the procedural history of the case and finds the following facts by a preponderance of the evidence.
This action commenced on January 21, 2014, when JDC filed its complaint against Sarjac. On March 19, 2014, Sarjac filed a motion to cite an additional party, the Town of West Hartford (town), as a third-party defendant, which the court (Robaina, J.) granted. Sarjac then filed a third-party complaint on April 21, 2014. On September 30, 2014, Sarjac filed an amended third-party complaint, which consisted of six counts sounding in common-law negligence. The town moved to strike that complaint in its entirety, claiming that its allegations were legally insufficient to state a claim on which relief could be granted because the town enjoys governmental immunity against common-law negligence claims unless such immunity has been abrogated by statute. The trial court (Rittenband, J.) agreed with the town and granted the motion to strike the third-party complaint on November 10, 2014. Our Appellate Court thereafter affirmed the propriety of that decision. J.D.C. Enterprises, Inc. v. Sarjac Partners, LLC, 164 Conn.App. 508, 517, 137 A.3d 894, 900, cert. denied, 321 Conn. 913, 136 A.3d 1274 (2016). More than sixteen months after the trial court struck the third-party complaint, JDC filed a request to amend its complaint to add various counts against the town, which the court (Huddleston, J.) denied.
Following the granting of the motion to strike the third-party complaint in its entirety, the town filed a motion for the entry of judgment against Sarjac on all counts of its third-party action. By order dated December 15, 2014, the court (Scholl, J.) granted that motion and rendered judgment accordingly.
On the first day of trial, December 7, 2016, this court heard argument on and sustained the objection to Sarjac's request to amend its answer and add special defenses, filed on November 30, 2016, including accord and satisfaction, failure to mitigate damages and other claims made by Sarjac relating to JDC's actions/inactions relative to the town's alleged liability and/or responsibility for the flooding which occurred on its property. Notwithstanding the dispute as to the circumstances around said payment that was the subject of the accord and satisfaction defense, the court noted the stipulation of the parties that, to the extent that Sarjac paid $35,000 to JDC on December 31, 2015, that payment would operate as a setoff to any judgment, if any, that would enter in favor of JDC.
JDC is a business which performs site development, improvement and demolition services as well as repairs, including emergency services, to underground utilities and water and sewer systems. When called for emergency services work, JDC operates under oral agreements.
On June 12, 2013, Sarjac contacted JDC to procure its services to respond to and remediate emergency flooding in the basement of Sarjac's property. The work involved three to four JDC employees onsite for a period of nearly seven weeks. Due to Sarjac's dispute with the town over its alleged responsibility for the flooding, Sarjac failed to pay JDC for services rendered. As a result, JDC borrowed over $100,000 to pay its own bills and meet payroll.
Charlton Carey, the onsite supervisor from JDC, credibly testified that the amount of water was so significant that JDC spent the first two days investigating its source. In addition, because there was a significant amount of rain during that initial week, JDC repeatedly pumped water out of the basement, only to find it flooded again following heavy rain. The water was so excessive that JDC employees described it as " gushing" at an uncontrollable rate through every crack and weak point in the concrete floor, so much so that it actually blew off a metal sump cover that weighed about forty pounds. They also found that the motors from the sump pumps which they had just installed were burned out because they were partially buried in sand and silt.
While investigating the source of the water, one JDC employee fell through the paved sidewalk in front of the property and into a sinkhole whose dimensions were eight to ten feet in length and width and ten feet deep. The sinkhole was so large that the interlocking design of the pavers alone maintained the integrity of the sidewalk over the gap until the JDC employee fell into the sinkhole. Suspecting that there was a relationship between the sinkhole and the flooding, JDC received permission from town officials to explore the cavity. JDC subsequently discovered a broken storm drain through which it passed a camera north toward Farmington Avenue. While the camera explored the drain, JDC employees observed water discharging from lateral pipes. At that time, they realized that the storm drain was active, and not abandoned as the town had believed. Moreover, they discovered that the discharged water, either released by sump pumps working from other commercial properties and/or from surface water flowing into catch basins, was draining back into Sarjac's property through the broken pipe. As a result, JDC secured permission from the town to fix the pipe. They also filled in the cavity, compacted the area, and leveled the ground to ensure that it was safe for pedestrians. The process of fixing the pipe, filling the cavity, and leveling the ground involved fifteen hours of work and $6,950.00 in labor costs.
The majority of the work performed by JDC over the course of several weeks pertained to its efforts to make operational the interior footing drainage system, which ultimately was replaced because it was so impacted with silt. In order to get access to the interior drainage system, JDC needed to jack-hammer the concrete floor of the property's basement, which they eventually had to replace as well. Using two five-gallon buckets per worker, JDC employees carried materials by hand, including silt, 3/4" stone and the processed aggregate used to rebuild the interior drainage system. During this process, JDC also discovered a five-foot " void" or " cavern" which reached underneath the building foundation and operated as an " underground river, " the pressure from which explained how uncontrolled amounts of water, stone and silt would enter into the building and through the floor. Because the workers had to hand-carry the buckets, balancing them while climbing up and down stairs from the basement of the building, the process was, as Carey described, extremely labor intensive, " brutal" work that took weeks to complete.
The court also notes that the erosion resulting from the broken drain pipe resulted in eighteen yards of material being removed and disposed of. The remediation work included the addition of eighteen yards of material to fill the cavity created underneath the sidewalk.
The parties do not dispute there was no written contract for the services performed by JDC. Sarjac, however, admitted that when JDC was called in to help extract water and to locate and isolate the problem, it effectively allowed JDC to work on a time and materials basis because the parties " had worked together previously." Based on the joint stipulation filed by the parties, the court also finds that Sarjac does not dispute that JDC performed its work satisfactorily and that Sarjac benefitted from that work.
DISCUSSION
JDC asserts three causes of action: in count one, breach of contract; count two, quantum meruit; and count three, unjust enrichment.
" The elements of a breach of contract action are the formation of an agreement, performance by one party, breach of the agreement by the other party and damages." (Internal quotation marks omitted.) Bross v. Hillside Acres, Inc., 92 Conn.App. 773, 780, 887 A.2d 420 (2006); see also Chiulli v. Zola, 97 Conn.App. 699, 706-07, 905 A.2d 1236 (2006) (same). The elements of a breach of contract claim must be proven by the preponderance of the evidence. See Waicunas v. Macari, 151 Conn. 134, 137, 193 A.2d 709 (1963); see also Colliers, Dow & Condon, Inc. v. Schwartz, 77 Conn.App. 462, 471, 823 A.2d 438 (2003); Daley v. Wesleyan University, 63 Conn.App. 119, 131-32, 772 A.2d 725, cert. denied, 256 Conn. 930, 776 A.2d 1145 (2001).
The rules governing contract formation are well settled. " To form a valid and binding contract in Connecticut, there must be a mutual understanding of the terms that arc definite and certain between the parties . . . To constitute an offer and acceptance sufficient to create an enforceable contract, each must be found to have been based on an identical understanding by the parties . . . If the minds of the parties have not truly met, no enforceable contract exists . . . [A]n agreement must be definite and certain as to its terms and requirements . . . So long as any essential matters are left open for further consideration, the contract is not complete." (Citations omitted; internal quotation marks omitted.) L& R Realty v. Connecticut National Bank, 53 Conn.App. 524, 534-35, 732 A.2d 181, cert. denied, 250 Conn. 901, 734 A.2d 984 (1999). A contract requires clear and definite terms. See Suffield Development Associates Ltd. Partnership v. Society for Savings, 243 Conn. 832, 843, 708 A.2d 1361 (1998). A court may, however, enforce an agreement " if the missing terms can be ascertained, either from the express terms or by fair implication." (Internal quotation marks omitted.) Geary v. Wentworth Laboratories, Inc., 60 Conn.App. 622, 627-28, 760 A.2d 969 (2000).
It is well established that " [p]arties are bound to the terms of a contract even though it is not signed if their assent is otherwise indicated." (Internal quotation marks omitted.) Original Grasso Construction Co. v. Shepherd, 70 Conn.App. 404, 411, 799 A.2d 1083, cert. denied, 261 Conn. 932, 806 A.2d 1065 (2002). " One enjoying rights is estopped from repudiating dependent obligations which he has assumed; parties cannot accept benefits under a contract fairly made and at the same time question its validity." (Internal quotation marks omitted.) Green v. Connecticut Disposal Service, Inc., 62 Conn.App. 83, 95, 771 A.2d 137, cert. denied, 256 Conn. 912, 772 A.2d 1124 (2001); see also Schwarzschild v. Martin, 191 Conn. 316, 321-22, 464 A.2d 774 (1983) (" [i]n the absence of a statute requiring a signature . . . parties may become bound by the terms of a contract, even though they do not sign it, where their assent is otherwise indicated, such as by the acceptance of benefits under the contract" [(internal quotation marks omitted).] Ullman, Perlmutter & Sklaver v. Byers, 96 Conn.App. 501, 505-06, 900 A.2d 602, 605-06 (2006).
" Whether and on what terms a contractual commitment has been undertaken are ultimately questions of fact for the trier of facts." (Internal quotation marks omitted.) Presidential Capital Corp. v. Reale, 231 Conn. 500, 507, 652 A.2d 489 (1994). Similarly, whether a contract too indefinite to be enforceable" is " a question for the trier of fact." Augeri v. C.F. Wooding Co., 173 Conn. 426, 430-31, 378 A.2d 538, 540 (1977).
In this case, the court finds that JDC cannot meet its burden of proof as to its breach of contract claim because the scope of the work to be performed, from the outset, was too indefinite. While it is clear that Sarjac solicited the services of JDC and agreed that JDC would be paid on a time and materials basis, at rates which were understood from prior work between the parties as well as agreed upon on site, the scope of work for which JDC was retained was not sufficiently clear or defined for there to be a meeting of the minds as to that critical term. Although JDC was asked to address the flooding emergency and identify and isolate the problem, neither party knew or could define the parameters of what that work would entail. Moreover, the scope of the services performed in this case extended beyond remediation efforts on Sarjac's property due to the discovery of the broken town storm pipe and the sinkhole cavity, and ultimately required nearly seven weeks of work. Thus, the court finds that the scope of the work to be performed in this case was simply too indefinite for the court to find an oral contract between the parties.
The court nevertheless finds in favor of JDC based on its equitable claims. " [U]njust enrichment and quantum meruit are meant to provide an alternative basis for recovery in the event of a failure to prove [a] breach of contract claim . . ." United Coastal Industries, Inc. v. Clearheart Construction Co., 71 Conn.App. 506, 511, 802 A.2d 901 (2002); see also BHP Land Services, LLC v. Seymour, 137 Conn.App. 165, 167, 47 A.3d 950 (affirming judgment of trial court finding no contract between parties but further finding " that the plaintiff was entitled to restitution pursuant to theories of both quantum meruit and unjust enrichment"), cert. denied, 307 Conn. 927, 55 A.3d 569 (2012). " Quantum meruit and unjust enrichment are noncontractual means of recovery in restitution. Quantum meruit is a theory of recovery permitting restitution in the context of an otherwise unenforceable contract. In contrast, recovery under a theory of unjust enrichment applies in the absence of a quasi-contractual relationship . . . Because both doctrines are restitutionary, the same equitable considerations apply to cases under either theory." (Citation omitted.) Walpole Woodworkers, Inc. v. Manning, 307 Conn. 582, 587 n.9, 57 A.3d 730 (2012).
At outlined in the Restatement (Third), Restitution and Unjust Enrichment, the differences between the two doctrines of quantum meruit and unjust enrichment warrant discussion. " A plaintiff who seeks a recovery 'in quantum meruit' usually asserts that the defendant is obligated to pay a reasonable price for specified services rendered . . . From its 17th-century origins to the present day, the single pleading has been used to state two quite different claims. One alleges what is recognizable today as an implied contract, alias a contract 'implied in fact.' If it is appropriate to conclude that a promise to pay reasonable compensation . . . was part of the parties' agreement--although nowhere expressed in so many words--a recovery called 'quantum meruit' enforces an implied term of an actual contract . . . But quantum meruit has often been used in a different set of cases as well, regarded in modern law as instances of unjust enrichment rather than contract. Because quantum meruit alleged a fictitious promise to pay, it was equally available to recover the value of benefits conferred in cases where the defendant had made no promise, express or implied." 1 Restatement (Third), Restitution and Unjust Enrichment, § 31, pp. 486-87 (2010).
" In modern practice, a claim styled 'quantum meruit' typically seeks compensation for services rendered in the expectation of payment, but in the absence of explicit agreement as to amount. Based on the circumstances of the transaction, it may be appropriate to find an implied promise by the defendant to compensate the plaintiff--usually at the customary wage or " going rate" for the work done. If so, the measure of the plaintiff's contractual expectation is described by the words " quantum meruit" (Or " as much as he is entitled to"), but the defendant's obligation is fully explained as a matter of contract. In such a case it would be erroneous to associate " quantum meruit with a liability in unjust enrichment, or to view the plaintiff's action as one for restitution rather than contract damages." Id.
" With respect to implied in fact contracts, we have recognized that " [w]hether [a] contract is styled express or implied involves no difference in legal effect, but lies merely in the mode of manifesting assent." (Internal quotation marks omitted.) Boland v. Catalano, 202 Conn. 333, 337, 521 A.2d 142 (1987). " A true implied [in fact] contract can only exist [however] where there is no express one. It is one which is inferred from the conduct of the parties though not expressed in words." (Internal quotation marks omitted.) Janusauskas v. Fichman, 264 Conn. 796, 804, 826 A.2d 1066 (2003); see also Hydro-Hercules Corp. v. Gary Excavating, Inc., 166 Conn. 647, 652, 353 A.2d 714 (1974) (" [t]he intention of the parties manifested by their words and acts is essential to determine whether a contract was entered into and what its terms were" [internal quotation marks omitted]).
" A contract implied in fact, like an express contract, depends on actual agreement." (Internal quotation marks omitted.) Coelho v. Posi-Seal International, Inc., 208 Conn. 106, 111, 544 A.2d 170 (1988); see also Hoffman v. Fidelity & Casualty Co. of New York, 125 Conn. 440, 443-44, 6 A.2d 357 (1939) (if parties' " minds have never met, no contract has been entered into by them"). However, " [i]t is not fatal to a finding of an implied contract that there were no express manifestations of mutual assent if the parties, by their conduct, recognized the existence of contractual obligations." (Internal quotation marks omitted.) Janusauskas v. Fichman, supra, 264 Conn. at 805, 826 A.2d 1066; see also Therrien v. Safeguard Mfg. Co., 180 Conn. 91, 94 95, 429 A.2d 808 (1980) (plaintiff has burden of proving that defendant " agreed, either by words or action or conduct, to undertake [some] form of actual contract commitment"). Thus, " conduct of one party, from which the other may reasonably draw the inference of a promise, is effective in law as a promise." 1 R. Lord, Williston on Contracts (4th Ed. 2007) § 4:2, pp. 344-46. " As long as the conduct of [the] party is volitional and that party knows or reasonably ought to know that the other party might reasonably infer from the conduct an assent to contract, such conduct will amount to a manifestation of assent." (Emphasis added.) Id., pp. 352-53; accord 1 Restatement (Second), Contracts § 19(2) (1981).
" In the traditional terms of offer and acceptance, when a " request is made under such circumstances that a reasonable person would infer an intent to pay for them . . . the request amounts to an offer, and a contract is created by the performance of the work . . . [C]onsistent with that principle . . . [a]n implied [in fact] contract would arise if the plaintiff rendered services, at the request of the defendant, under an expectation that they were to be paid for and if the defendant either intended to pay for them or the services were rendered under such circumstances that the defendant knew, or, as a reasonable person, should have known, that the plaintiff did expect payment . . . The question . . . is not whether the defendant in fact expected to pay for the services but whether they were rendered under such circumstances that the defendant either knew, or as a reasonable man, should have known, that the plaintiff expected compensation." Connecticut Light & Power Co. v. Proctor, 324 Conn. 245, 259-61, 152 A.3d 470, 478-79 (2016).
Thus, while an implied in fact contract implicates the doctrine of quantum meruit, an implied in law contract implicates the doctrine of unjust enrichment. See Vertex, Inc. v. City of Waterbury, 278 Conn. 557, 573-74, 898 A.2d 178, 190-91 (2006). " The term 'implied contract, ' . . . often leads to confusion because it can refer to an implied in fact contract or to an implied in law contract. An implied in fact contract is the same as an express contract, except that assent is not expressed in words, but is implied from the conduct of the parties. See Janusauskas v. Fichman, 264 Conn. 796, 804, 826 A.2d 1066 (2003).
" On the other hand, an implied in law contract is " not a contract, but an obligation which the law creates out of the circumstances present, even though a party did not assume the obligation . . . It is based on equitable principles to operate whenever justice requires compensation to be made." (Internal quotation marks omitted.) Yale Diagnostic Radiology v. Estate of Fountain, 267 Conn. 351, 359, 838 A.2d 179 (2004). An implied in law contract may arise due to one party being unjustly enriched to the detriment of the other party. See id., 360. Accordingly, an implied in law contract is another name for a claim for unjust enrichment. See Meaney v. Connecticut Hospital Assn., Inc., 250 Conn. 500, 511, 735 A.2d 813 (1999) (observing that claim for unjust enrichment is sometimes denominated implied in law claim or quasi-contract claim); see also 191 Am.Jur.2d 604, Restitution and Implied Contracts § 8 (2001) (" [u]njust enrichment is also referred to as . . . a contract implied in law").
Having considered both doctrines, this court finds that JDC has met its burden under either theory. As to quantum meruit, the court finds that although the express agreement may have failed for indefiniteness, Sarjac nonetheless assented, by their conduct, to the ongoing services provided by JDC to Sarjac. Moreover, the evidence is clear that, notwithstanding Sarjac's claim that the town promised to reimburse it for the broken pipe, Sarjac's third-party claims against the town sounded in negligence and common-law indemnification. As such, Sarjac's actions manifest an understanding that notwithstanding its belief that the town should ultimately be responsible for some portion of its damages, it was still liable in the first instance to JDC.
Notably, Sarjac's third-party complaint does not allege facts or make claims against the town based upon the town's alleged promise to pay.
This court's conclusions are also based on the nature of the work provided by JDC to Sarjac. With the exception of one day of work arguably attributable to fixing town property, specifically the broken pipe and filling of sinkhole and leveling of the sidewalk, which also benefitted Sarjac, the overwhelming majority of services performed by JDC over the course of seven weeks almost exclusively benefitted Sarjac's property, including the replacement of the interior footing drain and the enormous amount of work removing silt from Sarjac's property. The amount of silt displaced from the sizeable sinkhole and deposited on the property required the addition of eighteen yards of material to remediate. Moreover, JDC was on the premises from June 12, 2013 through July 28, 2013; at no time did Sarjac suggest that JDC cease the remedial work being performed on its property. Thus, the court finds in favor of JDC with respect to its quantum meruit claim.
As Sarjac acknowledges, its property could not effectively function as a commercial space unless the pipe was fixed and sidewalk restored.
Based on the same facts, this court finds that JDC has met its burden with respect to the elements of unjust enrichment. " Plaintiffs seeking recovery for unjust enrichment must prove (1) that the defendants were benefited, (2) that the defendants unjustly did not pay the plaintiffs for the benefits, and (3) that the failure of payment was to the plaintiffs' detriment." (Internal quotation marks omitted.) Jo-Ann Stores, Inc. v. Property Operating Co., LLC, 91 Conn.App. 179, 194, 880 A.2d 945 (2005). " Unjust enrichment is a very broad and flexible doctrine that has as its basis the principle that it is contrary to equity and good conscience for a defendant to retain a benefit that has come to him at the expense of the plaintiff." Gagne v. Vaccaro, 255 Conn. 390, 409, 766 A.2d 416 (2001), on appeal after remand, 80 Conn.App. 436, 835 A.2d 491 (2003), cert. denied, 268 Conn. 920, 846 A.2d 881 (2004).
In this case, Sarjac has stipulated that it benefitted from the services performed by JDC. Moreover, while Sarjac may have, in good faith, believed that the town should have been obligated to indemnify it and/or reimburse it, it remains that Sarjac procured JDC's services, which were rendered for the benefit of Sarjac. As such, the court concludes that Sarjac unjustly did not pay for the services that it received, and that its failure to do so inured to the detriment of JDC. The credible evidence is that JDC was not paid in full for over six weeks of work, which required that it assume a line of credit for $100,000 in order to make payroll and meet other expenses. The court therefore finds in favor of JDC with respect to its unjust enrichment claim.
Having found for the plaintiff, this court finds that the plaintiff has proven damages resulting from its claims of quantum meruit and unjust enrichment in the original principal amount of $154,559.54, which represents the reasonable value of services received by the defendant as embodied in the invoices it received from the plaintiff. The court also finds that because those monies were wrongfully detained, it awards ten percent interest pursuant to General Statutes § 37-3a. Said interest for the full amount shall be effective from August 28, 2013 through December 31, 2015 totaling $36,205.65 (reflecting a per diem rate of $42.35). Interest calculated from January 1, 2016 through July 13, 2017, to account for the principal reduced by the stipulated amount of the setoff, ($154,559.54 - $35,000 = 119, 559.54) amounts to $18,278.63 (reflecting a per diem rate of $32.76).
Thus, the court finds in favor of the plaintiff and awards total damages, reduced by the setoff and including the above calculations of prejudgment interest, in the amount of $174,043.82.