In many cases involving breach of contract where the amount of damages is an issue, courts seek an outcome that will put the contracting parties in the position they would have been in had the contract been performed according to its terms. Reaching that outcome often requires a thorough examination of the evidence.
Here, the owner of an undeveloped, 85-acre tract sought to add a pond to his property for recreational purposes. The owner hired a contractor to build the pond and agreed to pay his company $10,000 within two years. Construction on the pond began in 2002 and was completed in early 2003. During construction, the owner told the contractor that he had an opportunity to sell the black dirt from the pond’s excavation. The contractor told the owner that there was not much black dirt in the excavation area, but that he would create a second pond in an area where black dirt would be excavated.
Work continued until the Iowa Department of Natural Resources (DNR) stopped all excavation work on the property. The contractor billed the owner for the work done to that point. The owner was “shocked” by the amount of the bill and “outraged” to find that the extra black dirt came from southwest of the first pond -an area other than what was agreed upon by the parties. At trial, the owner testified that he and a friend returned the black dirt to the area, adding up to 300 person-hours of work. But, the owner had sold some of the dirt with the balance left in piles. After the pond was completed, a water-retention problem developed. The contractor offered to fix the leak -at an additional cost to the owner, of course. The owner fixed the leak himself and quit paying the contractor for the work that had been completed before the dispute.
The contractor sued, and the court concluded that the contractor was entitled to full payment for the first pond’s construction, minus the work done to fix the leak. The court determined that the dirt taken from the southwest side of the first pond amounted to a trespass by the contractor and ordered the contractor to pay an amount sufficient to restore the property, minus the money made from the dirt’s sale on the market.
On appeal, the Iowa Court of Appeals affirmed the trial court, finding that it was appropriate to reduce the contractor’s payment by the value of the owner’s efforts to repair the leak. The contractor also claimed that he had an oral contract with the owner for the removal of the dirt on the southwest area. He claimed that since the owner was aware of the excavation and on the site during the dirt removal, an implied-in-fact contract was established. However, the appellate court affirmed the trial court’s decision that the owner’s testimony that he did not know about the excavation was more credible. In addition, the appellate court agreed with the trial court’s award of damages for the owner’s work to return the southwest area to its original state.
Lastly, the appellate court determined that the owner was not “unjustly enriched” by the trial court’s finding that the contractor trespassed in the southwest area. Simon v. Avenarius, No. 9-545/08-1874, 2009 Iowa App. LEXIS 927 (Iowa Ct. App., Aug. 19, 2009).