Bonina v. Sheppard

78 N.E.3d 128

Stephen BONINA

v.Jane A. SHEPPARD.

No. 16-P-771

Appeals Court of Massachusetts, Worcester..

Argued March 2, 2017.

Decided June 1, 2017.

Barry A. Bachrach for the defendant. Scott G. Gowen for the plaintiff.

Scott G. Gowen , Medway, for the plaintiff.

Present: Kafker, C.J., Massing, & Desmond, JJ.

KAFKER, C.J.

The issue presented in this case is whether a substantial, uncompensated contribution by one unmarried cohabitant to improve the home owned by the other is recoverable in restitution. The plaintiff, Stephen Bonina, and the defendant, Jane A. Sheppard, were involved in a long-term nonmarital relationship. The plaintiff, a contractor, expended significant funds and labor to improve the home in which the couple lived for sixteen years, which was owned by the defendant. When the relationship ended, the plaintiff brought this action against the defendant claiming, inter alia, that she had been unjustly enriched by his contributions to the home. After a bench trial, a Superior Court judge awarded the plaintiff $156,913.07 in restitution, which represented the funds he expended to improve the home over sixteen years. The defendant appeals, claiming that the trial judge erred by (1) finding that she was unjustly enriched; and (2) calculating the plaintiff's restitution based on his costs to improve the home, rather than the increased value of the home with the improvements. We affirm.

Background . We summarize the facts found by the trial judge, supplemented by uncontroverted facts in the record.

Weber v. Community Teamwork, Inc ., 434 Mass. 761, 769, 752 N.E.2d 700 (2001). The plaintiff and the defendant met on New Year's Eve, 1989, and began dating shortly thereafter. Three years later, the parties became interested in purchasing a home in Bolton that had been vacant for two years. The home was owned by Concord Co–Operative Bank (bank). During negotiations with the bank, the parties coauthored a letter declaring their serious interest in the home, and explaining that the cost to bring the home to livable condition was $43,500, based on estimations by the plaintiff and another contractor. In May, 1993, the defendant purchased the home for $131,500 in her name only, becoming the sole obligor on the mortgage.

As it turned out, the entire home had to be gutted, and the necessary repairs cost much more than anticipated. The parties moved into the home in September, 1993. The plaintiff thereafter paid half of the mortgage payments, taxes, and living expenses during the cohabitation. He used various places in the home as his office for his contracting business.

In 1994, the parties constructed an addition to the living room. Between 1993 and 1998, the plaintiff spent $74,068.94 on improvements and maintenance of the home, which included the addition, as well as a new furnace, windows, a gas stove, and a new basement floor. The plaintiff spent "countless hours" performing the "overwhelming majority" of the work. The defendant spent $35,544.17 on improvements and maintenance during this period.

The parties were engaged on Christmas Eve, 1999. Around this time, the parties extended the kitchen to make a better passageway to a room that the plaintiff planned to use as his office. While this work was being performed, the parties decided to build a second floor above the office. From 1999 to 2004, the plaintiff spent approximately $98,352.02 on improvements to the home, most of which went toward materials to construct the addition and the second floor, such as roofing, siding, flooring, and electrical and plumbing work. The defendant spent $46,532.99.

In 2005, the plaintiff contributed approximately $17,967.32 for a new septic system. From 2006 to 2008, the plaintiff contributed an additional $3,572.24 for repairs and maintenance. The defendant's contributions during this time were minimal.

Shortly thereafter, the relationship deteriorated, and the plaintiff moved out in February, 2009. By this time, the plaintiff had contributed $93,744.94 towards the monthly mortgage payments, which represented approximately one-half of the payments due during the sixteen years that he lived in the home. The plaintiff then brought this action seeking restitution for his contributions to the home under an unjust enrichment theory.¹ The trial judge found that the "majority" of the plaintiff's costs reflected materials to construct the three additions, including lumber, cement, insulation, piping, and flooring, as well as other items that became permanent fixtures of the home, including windows, doors, appliances, the septic system, and the furnace. The judge deducted the plaintiff's costs for maintenance of the home, such as fence painting and lawn mowing, as well as those related to "short-term benefits," such as extension cords, light bulbs, and log splitting; the judge found that the plaintiff had received the benefit of those items. After deducting those latter amounts, the judge awarded the plaintiff $156,913.07 in restitution, which represented his costs to purchase the materials and the fixtures to improve the home.

Discussion . 1. Unmarried cohabitants and unjust enrichment . "Cohabitation in Massachusetts does not create the relationship of husband and wife in the absence of a formal solemnization of marriage, ... [and] the incidents of the marital relationship [do not] attach to an arrangement of cohabitation." Sutton v. Valois , 66 Mass.App.Ct. 258, 262, 846 N.E.2d 1171 (2006), quoting from Collins v. Guggenheim , 417 Mass. 615, 617, 631 N.E.2d 1016 (1994). See Wilcox v. Trautz , 427 Mass. 326, 332, 693 N.E.2d 141 (1998) (noting "clear distinction ... between the legal rights of married and unmarried cohabitants"). Unmarried cohabitants, however, "may lawfully contract concerning property, financial, and other matters relevant to their relationship." Ibid . See Northrup v. Brigham , 63 Mass.App.Ct. 362, 368, 826 N.E.2d 239 (2005) ; Sutton , supra . Equitable relief is also available, including restitution for unjust enrichment. See

Santagate v. Tower , 64 Mass.App.Ct. 324, 329, 833 N.E.2d 171 (2005) ; Sutton , supra at 262–263, 846 N.E.2d 1171. "We examine the judge's imposition of equitable remedies under an abuse of discretion standard." Cavadi v. DeYeso , 458 Mass. 615, 624, 941 N.E.2d 23 (2011) (citation omitted).

Unjust enrichment occurs when a party retains the property of another "against the fundamental principles of justice or equity and good conscience." Santagate , supra (citation omitted). The plaintiff must establish "not only that the defendant received a benefit, but also that such a benefit was unjust."Metropolitan Life Ins. Co . v. Cotter , 464 Mass. 623, 644, 984 N.E.2d 835 (2013). Whether the benefit was unjust "turns on the reasonable expectations of the parties." Ibid . (citation omitted).

The defendant claims that the trial judge erred in determining that she was unjustly enriched because the parties were in a romantic relationship when the plaintiff made his contributions to the home. We disagree. The parties' romantic relationship does not prevent the plaintiff from recovering from the defendant under an unjust enrichment theory. See Sutton , 66 Mass.App.Ct. at 263, 846 N.E.2d 1171. In Massachusetts, there is no presumption that a claimant's contributions during a romantic relationship are gratuitous. See Northrup , 63 Mass.App.Ct. at 368, 826 N.E.2d 239 (declining to apply "gratuitous services presumption" to services provided to former boy friend). The judge's factual findings demonstrate that the substantial contributions made by the plaintiff to improve the home were not meant to be gifts to the defendant. The trial judge found, for example, that the plaintiff "believed that [the parties] were to jointly purchase the home, make improvements, increase its value, and eventually buy a bigger home."

The Restatement (Third) of Restitution and Unjust Enrichment § 28(1) (2011) specifically provides for a remedy in these circumstances, stating, "If two persons have formerly lived together in a relationship resembling marriage, and if one of them owns a specific asset to which the other has made substantial, uncompensated contributions in the form of property or services, the person making such contributions has a claim in restitution against the owner as necessary to prevent unjust enrichment upon the dissolution of the relationship." Unjust enrichment in this context is based on the "claimant's frustrated expectations." Id . at comment c. Recovery is allowed because the claimant would not have conferred the benefit, "except in the expectation that the parties' subsequent relationship would be something other than it proved to be." Ibid .

In the present case, in accordance with § 28(1), the plaintiff's contributions to improve the defendant's home were substantial. The trial judge found that his compensable contributions totaled $156,913.07, which allowed three additions to be built and to remain permanent fixtures of the home. These contributions were also uncompensated because the defendant did not reimburse him and, although the plaintiff lived in the home for sixteen years, he paid $93,744.94 toward the mortgage. The judge found that the mortgage payments were "more than adequate for [the plaintiff's] use and occupancy [of] the residence." As such, the plaintiff could seek restitution for his contributions to the defendant's home under an unjust enrichment theory.

2. Proper measure of restitution . The defendant next claims that the trial judge erred by measuring the plaintiff's restitution as the costs he incurred in improving the home, rather than the increased value of the home with the improvements. We disagree, and conclude that, in the particular circumstances of this case, the judge did not abuse his discretion in determining that the plaintiff's costs in improving the home constituted a proper measure of unjust enrichment and restitution.

We begin by recognizing that measuring restitution for...