Chapter 3-3 Quantum Meruit

• Jurisdiction: United States

3-3 Quantum Meruit

3-3:1 Overview

Quantum meruit is an equitable cause of action which implies the existence of a contract to avoid the unjust enrichment of the defendant. Although an express contract generally precludes recovery in quantum meruit, there are several exceptions. A plaintiff is entitled to the reasonable value of his services rendered or materials furnished if he can prove he gave something of value to the defendant, which the defendant accepted, used and enjoyed, and for which the defendant reasonably understood the plaintiff expected to be paid.

3-3:1.1 Related Causes of Action

Assumpsit, Unjust Enrichment, Money had and received, Breach of Contract, Trover, Conversion, Restitution, Constructive Trust

MUST READ CASES

Vortt Expl. Co., Inc. v. Chevron U.S.A., Inc., 787 S.W.2d 942 (Tex. 1990)

Truly v. Austin, 744 S.W.2d 934 (Tex. 1988)

Bashara v. Baptist Mem'l Hosp. Sys., 685 S.W.2d 307 (Tex. 1985)

3-3:2 Elements

(1) The plaintiff gave either services or materials of value.¹⁵⁰,¹⁵¹

(2) The service or materials must have been given for the defendant.¹⁵²

• The value must be given for the defendant. Incidental benefits to the defendant are not sufficient.¹⁵³
• It is not necessary that the defendant own the improved property, so long as the plaintiff's services benefitted the defendant.¹⁵⁴
• A plaintiff who gives value so that he is also directly benefitted is precluded from recovery.¹⁵⁵

(3) The defendant accepted, used, and enjoyed the valuable thing.¹⁵⁶

• Equity imposes upon the defendant an obligation to pay because, if the defendant does not pay the plaintiff, the defendant would be unjustly enriched at the plaintiff's expense.¹⁵⁷

(4) The defendant reasonably understood the plaintiff expected to be paid.¹⁵⁸

• The plaintiff may expect any form of payment, including non-monetary forms.¹⁵⁹

3-3:3 Damages and Remedies

3-3:3.1 Reasonable Value

A plaintiff may recover the reasonable value of the services rendered or materials furnished.¹⁶⁰

A defendant may offset a plaintiff's recovery because of any defects in the services rendered or materials furnished.¹⁶¹

3-3:3.2 Interest

A plaintiff is entitled to interest as a matter of right if he can show that the measure of damages is fixed by conditions existing at the time the claim arose.¹⁶²

The measure of damages must be fixed, but the amount of damages does not need to be fixed.¹⁶³

3-3:4 Defenses

3-3:4.1 Statute of Limitations

The four-year limitations period applies to quantum meruit claims.¹⁶⁴ The cause of action accrues when the plaintiff renders services or furnishes materials.¹⁶⁵

The discovery rule likely does not apply to a claim for quantum meruit.¹⁶⁶

3-3:4.2 Express Contract

As a general rule, a plaintiff may not recover in quantum meruit when an express agreement covers the services rendered or materials provided.¹⁶⁷ Where the existence or terms of such an agreement is in dispute, it is the burden of the party seeking to preclude recovery in quantum meruit to secure findings from the trial court that an express contract exists that covers the subject matter of the dispute.¹⁶⁸

However, a plaintiff may recover in quantum meruit despite the existence of an express contract if:

(1) the plaintiff partially performed, but could not substantially perform, because of the defendant's breach,¹⁶⁹ or
(2) if the contract imposes unilateral obligations on the plaintiff.¹⁷⁰

Further, a breaching plaintiff may recover in quantum meruit on a construction contract.¹⁷¹

3-3:4.3 Offset

A defendant may offset a plaintiff's recovery in the amount of any defects in the...