Business Law 13th Edition by Frank Cross, Kenneth Clarkson, Roger LeRoy Miller

Exercise 2

BACKGROUND AND FACTS
Seawest Services Association owned and operated a water distribution system that served homes both inside and outside a housing development. Seawest had two classes of members. "Full members" owned property in the housing development, and "limited members" received water services for homes outside the development. Both full and limited members paid water bills and, as necessary, assessments for work performed on the water system. In 2001, the Copyright 2013 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(Copenhavers purchased a home outside the housing development. They did not have an express contract with Seawest, but they paid water bills for eight years and paid one $3,950 assessment for water system upgrades. In 2009, a dispute arose between the parties, and the Copenhavers began refusing to pay their water bills and assessments. Seawest sued the Copenhavers in a Washington state court. The trial court found that the Copenhavers were limited members of Seawest and thus were liable for the unpaid water bills and assessments. The Copenhavers appealed.
IN THE LANG UAGE OF THE COURT LAU,
J. [Judge]
* * * * * * * The essential elements of unjust enrichment are " 'a benefit conferred upon the defendant by the plaintiff; an appreciation or knowledge by the defendant of the benefit; and the acceptance or retention by the defendant under such circumstances as to make it inequitable for the defendant to retain the benefit without the payment of its value.' " [Emphasis added.] Undisputed evidence * * * shows that the Copenhavers * * * have utilized the Seawest system and have paid, without objection until litigation ensued, all water use, water maintenance, and assessment base charges to Seawest. *
* * * * * * The Copenhavers would be unjustly enriched if they could retain benefits provided by Seawest without paying for them. The Copenhavers obtained property that carried with it a water share. They knew that no property owner is entitled to receive water without membership in Seawest. We conclude that the undisputed record supports a contract implied in law.
DECISION AND REMEDY?The Washington appellate court affirmed the trial court's judgment. It held that the Copenhavers were liable to Seawest because the parties had a quasi contract.
The Ethical Dimension In recognizing quasi contracts, does the law try to correct for unethical behavior? Why or why not?
The Economic Dimension Could the Copenhavers have successfully argued that by forcing them to pay a price to which they had not agreed, Seawest was unjustly enriched at their expense?