## Facts

- George Anderson owned a 1935 Plymouth and orally agreed that Ronald Schwegel, an auto-body shop operator, would “restore” the vehicle for $6,000.
- The parties attached different meanings to “restore”: Anderson believed it meant a complete restoration (except upholstery) including engine repairs, while Schwegel believed it meant body restoration (including paint) and that engine work would cost extra.
- Neither party realized the misunderstanding at the time of the oral agreement, and they never reduced the agreement to writing.
- After beginning work, Schwegel later told Anderson the car needed substantial engine work to be drivable.
- Anderson authorized the engine work without asking whether those repairs were included within the original $6,000 figure; the engine work was performed by a separate shop with Anderson’s knowledge and approval.
- Before the work was finished, Anderson received an itemized statement showing charges that exceeded $6,000 by more than $2,000, and he did not object.
- The total cost of the work ultimately reached about $9,800. Anderson paid $5,000 but refused to pay the remaining balance (about $4,800).
- Schwegel refused to return the Plymouth until the balance was paid.
- Anderson sued seeking enforcement of a $6,000 contract price and return of the car; Schwegel counterclaimed for the unpaid amount based on the reasonable value of the labor and materials provided, including a 20% markup on certain subcontracted work.
- The magistrate concluded no enforceable contract existed due to the parties’ different understandings of “restore,” awarded Schwegel the unpaid balance in quasi-contract (unjust enrichment), and awarded Schwegel attorney’s fees; the district court affirmed, and Anderson appealed.

## Issues

1. Whether an enforceable contract existed when the parties used the term “restore” but attached materially different meanings to that term.
2. Whether Schwegel’s counterclaim for compensation was time-barred, or instead accrued when the overall restoration transaction was completed and payment became due.
3. In unjust enrichment, whether recovery should be limited to any increase in the vehicle’s market value, or may be based on the reasonable value of services and materials conferred and retained.
4. Whether a 20% markup on subcontracted work could be included in the quasi-contract recovery as part of the reasonable value of the benefit conferred.
5. Whether the trial court properly treated Schwegel as the prevailing party and awarded attorney’s fees.

## Decision

- The Idaho Court of Appeals affirmed the judgment for Schwegel.
- No enforceable express contract existed because there was no mutual assent as to the meaning of the material term “restore.”
- Schwegel was entitled to restitution under quasi-contract for the reasonable value of the services and materials Anderson requested or authorized and then retained.
- The counterclaim was not time-barred because the parties’ dealings constituted a single, continuous restoration project; the cause of action accrued upon completion of the project and when the balance became due.
- The magistrate did not err by measuring restitution by the value of the enrichment actually conferred (the reasonable value of work and materials), rather than by any increase in the car’s market value.
- The 20% markup on certain subcontracted work was properly included as part of the reasonable value of the services provided.
- The prevailing-party determination and award of attorney’s fees to Schwegel were affirmed.

## Legal Principles

- No enforceable contract is formed where the parties attach different meanings to a material term and there is no meeting of the minds on that term.
- When an express contract fails, a party who provides services or materials at another’s request or with that person’s authorization may recover in quasi-contract to prevent unjust enrichment.
- In unjust enrichment, restitution is based on the value of the enrichment actually conferred and retained, commonly measured by the reasonable value of services and materials provided; the measure is a fact question for the trier of fact.
- For a single, continuous course of performance treated as one transaction, a claim for compensation accrues when the transaction is completed and payment is due, not when individual tasks are performed.
- Amounts that are part of the reasonable value of the services provided, including a proven and reasonable markup on subcontracted work, may be recoverable in quasi-contract.
- Prevailing-party status and attorney’s fee awards are reviewed for abuse of discretion and are sustained when the party obtained the principal relief on the main issues.

## Conclusion

Anderson v. Schwegel held that the parties’ oral “restore” agreement was unenforceable because each side meant something different by a key term, so the shop could not be bound to a $6,000 cap but could recover in unjust enrichment for the reasonable value of the work and materials Anderson authorized and kept, including a reasonable markup on subcontracted engine work; the shop’s counterclaim accrued upon completion of the overall restoration project and was timely, and the shop was properly awarded attorney’s fees as the prevailing party.


Anderson v. Schwegel, 796 P.2d 1035 (1990)