## Facts

- Jeffrey S. Nichols, a funeral director and property owner, undertook construction of a crematorium and parking lot improvements.
- An architect’s drainage plan initially contemplated directing surface water into public ways and existing storm sewers, and the city initially approved the plan.
- Nichols separately hired Roger’s Backhoe Service, Inc. for certain early demolition work, which was completed and paid; Nichols also retained a general contractor, Scott Price, who separately used Roger’s for a curb-cut, which was also paid.
- After work began, city officials required the project to attempt to route drainage to an underground creek/storm-sewer component roughly fourteen feet below grade, prompting the need for additional excavation and exploratory work.
- Nichols objected to the city’s requirement and did not expressly authorize the added digging, but Roger’s proceeded so the project could continue and satisfy the city’s demand.
- Roger’s performed several days of additional excavation and related site work and invoiced Nichols; Nichols refused to pay.
- The city later withdrew the demand and allowed completion without the underground connection.
- The district court found the extra work was performed with Nichols’s knowledge and tacit approval, benefited the project, and was billed at fair and reasonable rates.

## Issues

1. Whether an implied-in-fact contract existed obligating Nichols to pay for additional excavation and related work performed in response to city demands, notwithstanding Nichols’s objections and lack of express authorization.
2. Whether Roger’s could recover where the services benefited Nichols’s project and were tried as an implied contractual claim, even if the pleadings did not precisely label the contract theory.

## Decision

- The Iowa Supreme Court vacated the court of appeals’ reversal and affirmed the district court’s judgment for Roger’s.
- The Court held the evidence supported the district court’s finding of an implied-in-fact contract based on the parties’ conduct and surrounding circumstances.
- The Court upheld the finding that the work benefited Nichols by addressing regulatory requirements needed for the project to proceed when performed and that the charges were reasonable.
- The Court rejected Nichols’s technical pleading challenge because the implied-contract theory was supported by the facts litigated and Nichols did not seek clarification through procedural motions.

## Legal Principles

- An implied-in-fact contract may be established by the parties’ conduct, course of dealing, and circumstances showing mutual assent, even without an express agreement.
- A recipient’s knowledge, presence, and failure to stop ongoing services can support an inference of acceptance and an obligation to pay when services are performed with an expectation of compensation.
- Benefit may be shown where work is reasonably necessary at the time to satisfy governmental requirements and allow a construction project to continue, even if the requirement is later withdrawn.
- Under liberal pleading and variance principles, a claimant is not barred from recovery solely because the petition does not precisely categorize the contract as written, oral, or implied, where the facts supporting the theory were tried and the opposing party had adequate notice.

## Conclusion

The court affirmed an award for additional excavation because the owner’s conduct supported an implied-in-fact agreement to pay for work performed to meet city demands and keep the project moving, and technical pleading objections did not defeat relief consistent with the proof at trial.


Roger’s Backhoe Serv., Inc. v. Nichols, 681 N.W.2d 647 (Iowa 2004)