No. 238 Pittsburgh, 1980, No. 237 Pittsburgh, 1980, Appeal from the Order of the Court of Common Pleas, Somerset County, No. 12 Civil 1978 and No. 13 Civil 1978.
William F. Patterson, Johnstown, for appellants.
James B. Yelovich, Somerset, for appellee.
Spaeth, Johnson and Popovich, JJ. Johnson, J., files a concurring and dissenting opinion.
[ 291 Pa. Super. Page 312]
These are consolidated appeals from an Order entered by the court en banc dismissing appellants' exceptions to the Chancellor's findings. For the reasons set forth below, we affirm the lower court's Order.
It is settled that "'the findings of fact of the [c]hancellor who heard the testimony without a jury, approved by the court en banc, are entitled to the weight of a jury's verdict; that such findings are controlling and that the court's decree should not be reversed unless it appears that the court abused its discretion or that the court's findings lack evidentiary support or that the court capriciously disbelieved the evidence.'" (Citations omitted) Hankin v. Hankin, 279 Pa. Super. 179, 196, 420 A.2d 1090, 1099 (1980); accord Silo Realty Corp. v. Redevelopment Authority of The City of Philadelphia, 289 Pa. Super. 67, 432 A.2d 1053 (1981). The chancellor's findings are entitled to particular weight in a case in which the credibility of the witnesses must be carefully evaluated, because he has had the opportunity to hear them and to observe their demeanor on the stand. Sorokin v. Krasner, 289 Pa. Super. 324, 433 A.2d 88 (1981); Kimball v. Barr Township, 249 Pa. Super. 420, 378 A.2d 366 (1977). "'In such case, the party favored by the finding is entitled to have the evidence viewed in the light most favorable to him and to have all conflicts in the testimony resolved in his favor.'" (Citations omitted) Johnston Truck Rental Co. v. Fowler-McKee, 281 Pa. Super. 271, 274, 422 A.2d 164, 165 (1980). So viewed, the facts, as gleaned from the trial transcript, are as follows:
In 1972, George Zvonik-appellee orally agreed with Anna Zvonik, his mother, that he would provide the labor and materials to repair her home and construct a two-room addition thereto. Appellee also agreed to pay all the utilities
[ 291 Pa. Super. Page 313]
and property taxes. The mother in turn promised that appellee and his family could live with her and that prior to her death she would convey the property to him. In reliance upon said agreement, appellee moved into the premises and sold lots that he owned to get some of the capital needed to make the improvements desired by the mother. (N.T. 2/26/79, at 61 & 65) Appellee's wife also borrowed money ($200-$300 from the credit union) to supplement what the appellee obtained. Id.
After the appellee substantially completed the work on the homestead, the mother conveyed the property by deed to her daughter-in-law, Pauline Zvonik-appellant (Pauline). Thereafter, Pauline instituted an action in ejectment and appellee relinquished possession of the property. With this action, family relations deteriorated; e. g., appellee was involved in an altercation with Pauline's husband, Andrew Zvonik-appellant (Andrew), which led to the filing of criminal charges (Aggravated Assault). However, pursuant to a "stipulation" reached in open court on February 25, 1974, the charges were nolle prossed. The parties agreed that an impartial building contractor would appraise the "fair value" of the work performed by the appellee; that Andrew would pay that amount and appellee would accept it in full and final compromise of his claim. (N.T. 2/25/74, at 2-6) As agreed, a contractor (Lloyd Zimmerman) was selected by the appellee, and he submitted an appraisal on June 12, 1975 (delineating the cost of the work done) totaling $8,520.00. See note 7 infra. Andrew was supplied with the estimate but failed to pay the amount stated or any part thereof. Moreover, on May 29, 1975, Andrew and Pauline transferred the property in question to their son (Paul), but retained a life estate therein.
It was January 20, 1978, before the appellee took any legal recourse. At that time, he filed two Complaints in Assumpsit -- No. 12 Civil 1978 and No. 13 Civil 1978 -- which resulted in rulings in his favor, and the exceptions filed therein were dismissed by the court en banc. This appeal followed.
[ 291 Pa. Super. Page 314]
our position. For example: in Scott v. Purcell, 264 Pa. Super. 354, 399 A.2d 1088 (1979) the appellant proved the existence of an oral agreement whereby Purcell consented to act as his agent in buying a piece of property. Purcell, after several months of negotiations, succeeded in getting the parties to agree to a purchase price. However, shortly after Purcell informed appellant that he was having difficulty obtaining financing for the project, a deed from the seller to Oaklander Associates was recorded. Oaklander Associates consisted of Oakland Corp., of which Purcell was vice president and his wife and two others were shareholders.
Although the Court in Scott reversed the trial judge's granting of a non-suit as to Oaklander Associates, holding that the evidence was sufficient to warrant the imposition of a constructive trust, the Court's observations on why Oaklander Associates was unjustly enriched are equally applicable to the case at bar, viz. :
"The case is otherwise with respect to unjust enrichment. In Buchanan v. Brentwood Federal Savings and Loan Association, [457 Pa. 135, 320 A.2d 117 (1964)], the Supreme Court stated that the imposition of a constructive trust on the property in question would be proper if the appellants were able to show on remand that the appellees had been unjustly enriched; such a showing would amount to 'a general assertion that the ends of public policy and substantial justice demand that a constructive trust be impressed.' Buchanan v. Brentwood Federal Savings and Loan Association, supra 457 Pa. at 155, 320 A.2d at 128. Recently, we said that to sustain a claim of unjust enrichment, 'appellant must show that she wrongfully secured or passively received a benefit that it would be unconscionable for her to retain.' Roman Mosaic and Tile Co., Inc. v. Vollrath, 226 Pa. Super. 215, 218, 313 A.2d 305, 307 (1973); See generally Moreland v. Metrovich, 249 Pa. Super. 88, 375 A.2d 772 (1977); Kimball v. Barr Township, supra; Restatement of Restitution §§ 160, 194 (1937). Here, appellant has made no showing that Oaklander Associates 'wrongfully secured' the property in
[ 291 Pa. Super. Page 316]
question, but he has shown that it 'passively received a benefit that it would be unconscionable for [it] to retain.' The fact that Oaklander Associates may not on the present record be held to have known of Purcell's wrongful acts does not refute the basic point that it was given a chance to buy the property, only because Purcell violated his duties to appellant as appellant's agent." Id., 264 Pa. Super. at 367, 399 A.2d at 1095.
Keeping the aforesaid in mind, we turn to the facts instantly. At trial, appellee testified that his mother approached him with the offer that, ". . . you build me two rooms and everything on my side. She says youns [sic] can move in the old part . . . . She says, you keep me as long as I live. Then the house is yours." (N.T. 2/6/79, at 61) On cross-examination, appellee reiterated the terms of the oral agreement.*fn3 Id. at 79. This accounting was corroborated by a disinterested witness (Nicholas Bruno), who stated that the mother "requested if [appellee] build [sic] her two rooms, that he could live in the house. And in due time . . . . [s]he would give him a deed for the house."*fn4 Id. at 12 & 22.
[ 291 Pa. Super. Page 317]
The evidence at trial further disclosed that the appellee moved into the premises, cared for the mother and for a year and a half incurred all the expenses attendant to the upkeep of the house. Despite his expenditure of time and money ($8,520.00) to improve substantially the condition of the premises, see Messinger v. Washington Township, 185 Pa. Super. 554, 137 A.2d 890 (1958), the mother did not comply with her part of the bargain.*fn5 (N.T. 2/6/79, at 64)
[ 291 Pa. Super. Page 318]
Instead, she conveyed the property to Pauline for one dollar, who in turn transferred it to her son, Paul, for the same amount.
As was the case in Scott v. Purcell, supra, appellee here made no showing that Pauline and Paul "wrongfully secured" the property in question, but we find that he has shown that they "passively received a benefit that it would be unconscionable for [them] to retain." Id., 264 Pa. Super. at 367, 399 A.2d at 1095. The fact that appellants may not on the present record be held to have known of the mother's wrongful acts, but see Farmers National Bank of Bloomsburg v. Albertson, 203 Pa. Super. 205, 199 A.2d 486 (1964) (absent actual knowledge, circumstances can impose upon one the duty to have knowledge, e. g., close family relationship) does not refute the basic point that they were the beneficiaries of appellee's agreement, Restatement of Restitution §§ 1 & 204, whereby he contributed to the maintenance and improvement of the premises. To divest the appellee now of the opportunity to recoup the "fair value" of his services would be truly unjust. See, e. g., Harkins v. Zamichieli, supra; Hall v. Milham, 225 Ark. 597, 284 S.W.2d 108 (1955); Eastwood v. Eastwood, 167 Kan. 471, 207 P.2d 393 (1949); Corbin on Contracts § 19, p. 27 (1952) ("A quasi contractual obligation is one that is created by the law for reasons of justice, without any expression of assent and sometimes even against a clear expression of dissent . . . . It must be ...