Most people meet unjust enrichment the same way: a job got done, nobody paid, and there is no signed contract to sue on. The instinct is that the law must have a backstop — some doctrine that says a person who takes the benefit of your work has to pay for it. Minnesota has that doctrine. It is much narrower than the instinct suggests, and it fails for two reasons that have nothing to do with whether the defendant behaved badly.
The first is a word. Minnesota does not read “unjust” as a synonym for “unfair.” The Supreme Court has said that unjust enrichment claims “do not lie simply because one party benefits from the efforts or obligations of others, but instead it must be shown that a party was unjustly enriched in the sense that the term ‘unjustly’ could mean illegally or unlawfully.” ServiceMaster of St. Cloud v. GAB Business Services, Inc., 544 N.W.2d 302, 306 (Minn. 1996). That is a materially higher bar than moral disapproval.
The second is a structural rule that kills more of these claims than the merits ever do: equity is closed to you if the law was open to you — including if the law was open to you and you let it close. That is not a technicality. It is the holding of two Minnesota decisions in which contractors who did the work, were not paid, and unquestionably conferred a benefit walked away with nothing because they had a mechanic’s lien remedy and did not use it.
Does Minnesota let you recover just because someone got a benefit they did not pay for?
No. Benefit alone does nothing.
The Minnesota Supreme Court said so plainly in a quantum meruit case decided in 1941: “the simple fact of benefit without more does not impose contractual liability. Services having gratuitous origins frequently are of great benefit to the recipients.” High v. Supreme Lodge of the World, Loyal Order of Moose, 210 Minn. 471, 474 (1941).
The modern formulation adds the knowledge and the wrongfulness. To establish unjust enrichment, a claimant “must show that the defendant has knowingly received or obtained something of value for which the defendant ‘in equity and good conscience’ should pay.” ServiceMaster, 544 N.W.2d at 306. The Court of Appeals states the same test as requiring proof “that a party has knowingly received something of value, not being entitled to the benefit, and under circumstances that would make it unjust to permit its retention.” Southtown Plumbing, Inc. v. Har-Ned Lumber Co., 493 N.W.2d 137, 140 (Minn. Ct. App. 1992).
Read together, the working elements are:
- The defendant knowingly received or obtained something of value;
- The defendant was not entitled to it;
- Retention is unjust — and Minnesota glosses “unjust” toward illegally or unlawfully, not merely regrettably; and
- The relationship between the claimant and the defendant supports an implied-in-law or quasi-contract.
In 2012 the Supreme Court restated the requirement in a single sentence and put the fourth element on the same footing as the rest: “to prevail on a claim of unjust enrichment, a claimant must establish an implied-in-law or quasi-contract in which the defendant received a benefit of value that unjustly enriched the defendant in a manner that is illegal or unlawful.” Caldas v. Affordable Granite & Stone, Inc., 820 N.W.2d 826, 838 (Minn. 2012).
What is the difference between unjust enrichment, quantum meruit, and quasi-contract?
This is the vocabulary problem that makes these claims hard to plead cleanly, and the Supreme Court has acknowledged it directly.
Quantum meruit is a term that is frequently misunderstood, largely because it may apply to two very different circumstances: as a claim at law for the fair market value of a party’s performance under an implied-in-fact contract, or as a claim in equity as restitution for the value of a benefit conferred in the absence of a contract under a theory of unjust enrichment.
In re Distribution of Attorney’s Fees Between Stowman Law Firm, P.A., 870 N.W.2d 755, 767 n.2 (Minn. 2015).
That footnote is the most useful sentence in Minnesota law on this subject, because it tells you that “quantum meruit” answers a measurement question — how much — and can sit on top of either of two different liability theories:
| Theory | What creates the obligation | What you must prove | Typical measure |
|---|---|---|---|
| Implied-in-fact contract (quantum meruit at law) | The parties’ actual conduct — a real agreement inferred from circumstances | Services rendered; circumstances from which a promise to pay should be implied; their value (High, 210 Minn. at 473) | Reasonable value of the services |
| Unjust enrichment / quasi-contract (restitution in equity) | The law, over the parties’ heads, to prevent unjust retention | Knowing receipt of value, not entitled to it, retention unjust in the sense of illegal or unlawful (ServiceMaster; Caldas) | Value of the benefit the defendant received |
“Quasi-contract” and “contract implied in law” are the same thing, and unjust enrichment is the basis of recovery on that theory. Caldas describes unjust enrichment as “commonly referred to as a quasi-contract or a contract implied-in-law claim.” 820 N.W.2d at 838.
The practical consequence: an implied-in-fact contract is a legal claim built on what the parties actually did, and it does not carry equity’s disabilities. Unjust enrichment is an equitable claim and does. If your facts will support an implied-in-fact agreement — a course of dealing, invoices sent and accepted without objection, a pattern of payment — plead it, because it is the stronger of the two.
Does an express contract kill the claim?
Yes, when the contract covers the same subject and is between the same parties. This rule is old, short, and absolute in its phrasing: “It is fundamental that proof of an express contract precludes recovery in quantum meruit.” Breza v. Thaldorf, 276 Minn. 180, 183, 149 N.W.2d 276, 279 (1967).
The Supreme Court applied it to reverse a $60,000 award in Sharp v. Laubersheimer, 347 N.W.2d 268, 271 (Minn. 1984), where a partner who had done substantial work for a partnership was awarded quasi-contract compensation even though the partnership agreement was silent on compensation. Silence was not a gap the court would fill: “Because there was an express contract in this case, the trial court’s award of compensation under a quasi-contract or an unjust enrichment theory, which in essence amounted to an award in quantum meruit, was contrary to well-established Minnesota case law.” Id.
The Court of Appeals states the rule in its broadest form: “The existence of an express contract between the parties precludes recovery under the theories of quasi-contract, unjust enrichment, or quantum meruit.” Sterling Capital Advisors, Inc. v. Herzog, 575 N.W.2d 121, 126 (Minn. Ct. App. 1998).
Two refinements matter in practice.
The contract has to actually cover the dispute. Caldas phrases the bar as: unjust enrichment “does not apply when there is an enforceable contract that is applicable.” 820 N.W.2d at 838 (emphasis added). Where the express agreement is silent on the subject in a way that leaves it genuinely outside the bargain — as opposed to Sharp, where silence about partner compensation was itself the deal — the analysis is different. But do not count on that distinction. Minnesota courts read contracts as covering more than parties expect, and Sharp is a warning that “the contract does not mention it” is not the same as “the contract does not govern it.”
Pleading in the alternative is still allowed. Minnesota Rule of Civil Procedure 8.05(b) provides that “[a] party may also state as many separate claims or defenses as the party has regardless of consistency and whether based on legal or equitable grounds or both.” So you may plead breach of contract and unjust enrichment together. What you cannot do is recover on both, and if the contract is admitted and applicable, the equitable count is coming out on summary judgment. Plead it as a hedge against the defendant disputing formation — not as a second bite.
If your problem is that the agreement was never written down, the statute of frauds analysis matters more than the unjust enrichment analysis. That is covered in Minnesota’s statute of frauds and what it actually blocks.
What if you had a legal remedy and blew the deadline?
You still lose. This is the part that surprises people, and it is settled.
“A party may not have equitable relief where there is an adequate remedy at law available.” ServiceMaster, 544 N.W.2d at 305. Note the word available — not used.
In ServiceMaster, a restoration contractor repaired a fire-damaged house, was never paid, and sued the homeowner’s insurer for unjust enrichment. The contractor had failed to serve the pre-lien notice required by the mechanic’s lien statute within the statutory window. The Supreme Court held that both the statutory lien and Minnesota’s constitutional lien under Article I, section 12 were adequate remedies barring equitable relief, and put the point bluntly:
The mechanic’s lien statute provides contractors with a sure remedy for getting paid but it requires compliance with strict time restrictions on the part of the contractor to protect its rights. Should a contractor elect not to seek the protection of the clear and effective method available under the statute, this court will not come to its aid, absent compelling circumstances not present here.
Id. at 306.
The Court of Appeals reached the same result four years earlier on materially similar facts. Five subcontractors on a residential project were not paid, filed mechanic’s liens, then abandoned them in favor of an unjust enrichment suit against the construction lender. Directed verdict for the lender, affirmed: “Because they had a statutory remedy and chose not to enforce it, they cannot make out an equitable claim for unjust enrichment.” Southtown Plumbing, 493 N.W.2d at 140. The court stated the principle more broadly still — “Relief under the theory of unjust enrichment is not available where there is an adequate legal remedy or where statutory standards for recovery are set by the legislature.” Id.
That second clause is the one to sit with. Where the legislature has built a remedial scheme for a category of claim, courts treat the scheme as the measure of what is recoverable, and equity will not be used to route around its conditions. For construction claimants, that scheme is chapter 514, and the deadlines are unforgiving — see Minnesota mechanic’s lien deadlines. For a buyer of defective goods, the scheme is Article 2 of the UCC — see UCC Article 2 warranties in Minnesota.
The operational lesson for anyone owed money on a construction project: perfect the lien first and think about equity second. An unjust enrichment count is not a fallback for a missed pre-lien notice. It is the opposite — the missed notice is the reason the count fails.
Can you sue someone you never dealt with?
Usually not, and this is where Caldas did the most work.
The Supreme Court there said it has “limited the application of unjust enrichment to claims premised on an implied or quasi-contract between the claimant and the party alleged to be unjustly enriched.” 820 N.W.2d at 838. Employees of a subcontractor sued the subcontractor for prevailing wages promised in its contract with the City of Minneapolis. They were only incidental third-party beneficiaries of that contract, so they could not enforce it. The unjust enrichment count was their attempt to get the same money without the standing problem, and the Court refused: “Essentially, appellants are attempting to bring an unjust enrichment claim to avoid the result that they lack third-party beneficiary status to enforce the contract.” Id. at 838–39. It cited the older rule that “equitable relief cannot be granted where the rights of the parties are governed by a valid contract.” Id. at 839 (quoting U.S. Fire Ins. Co. v. Minnesota State Zoological Board, 307 N.W.2d 490, 497 (Minn. 1981)).
Apply that to the common fact pattern. A subcontractor is stiffed by a general contractor, and the owner has a finished building. The owner is enriched. But the subcontractor’s dealings were with the general, not the owner, and the owner paid the general — so there is no quasi-contract between the subcontractor and the owner, and typically no enrichment at all once the owner has paid once. ServiceMaster made exactly that point about the insurer: it “did not receive a security interest in Mollinedo’s home under any cloud of impropriety; nor did what Sentry receive even constitute ‘enrichment,’ as Sentry paid dollar-for-dollar for what it got.” 544 N.W.2d at 306.
The claims that survive tend to have a direct dealing plus something the defendant did that looks wrongful. In Southtown Plumbing, the court held that the claimants had not shown the construction lender “knowingly took advantage of them” — the standard by which it distinguished an earlier case, Anderson v. DeLisle, where a seller who watched a buyer sink money into property improvements before foreclosing and profiting was held liable in restitution. What distinguished the lender’s conduct in Southtown itself: it never supervised the work, never dealt with the subcontractors, and never required them to give up their liens. 493 N.W.2d at 141. If your defendant watched you work, knew you expected payment from it, and pocketed the value, you have a case worth building. If your defendant simply paid the person you should have collected from, you do not.
How long do you have?
Plan on six years, and do not treat the equitable label as an escape from the statute.
Minnesota Statutes section 541.05, subdivision 1(1), gives six years for an action “upon a contract or other obligation, express or implied, as to which no other limitation is expressly prescribed.” Unjust enrichment is characterized in Minnesota as a contract implied in law. Caldas, 820 N.W.2d at 838. Accrual — when the six years starts — is fact-specific and is the fight worth having, not the length of the period.
If the underlying scheme has its own shorter deadline, that deadline governs, because § 541.05 subd. 1(1) applies only where “no other limitation is expressly prescribed” and because Southtown Plumbing forecloses using equity to escape legislative standards. Mechanic’s lien claimants live under chapter 514’s clock, not this one.
What is the claim actually worth?
Unjust enrichment measures the defendant’s gain, not the plaintiff’s loss. That is why ServiceMaster found no enrichment where the insurer paid full value for what it received: there was nothing left over to disgorge. Quantum meruit on an implied-in-fact contract measures the reasonable value of the services, which is a different number and usually an easier one to prove — you can put on evidence of hours, rates, and market value rather than trying to quantify what the defendant’s balance sheet gained.
Stowman is the cleanest illustration that these are separate questions. A law firm that withdrew from a contingent-fee case sought quantum meruit for the value of its pre-withdrawal work. The Supreme Court held that an attorney who withdraws for good cause may recover in quantum meruit the reasonable value of services rendered before withdrawal, but that the firm there had not shown good cause — the client’s refusal to accept a settlement offer is not good cause, because “[t]he decision whether to settle a case is the client’s to make.” 870 N.W.2d at 763, 766. The measure was never in dispute. Entitlement was.
The short version
Unjust enrichment in Minnesota is a gap-filler for the case where there is genuinely no contract, no statutory scheme, and no other route to the money — and where the defendant’s retention of the benefit is closer to unlawful than to inconvenient. It is not a fairness override, it will not rescue a lien you failed to perfect, it will not manufacture standing you do not have under someone else’s contract, and it will not sit alongside an express agreement that covers the same ground.
The practical order of operations is: (1) is there an express contract with this defendant on this subject? If yes, sue on it. (2) Is there a statutory remedy — mechanic’s lien, UCC, wage statute? If yes, perfect it on time. (3) Is there an implied-in-fact contract from the parties’ conduct? If yes, that is a legal claim and it is stronger. (4) Only then, unjust enrichment. And if you get to step four, be ready to show what the defendant did that was more than merely accepting a benefit.
A related but distinct doctrine — promissory estoppel — solves a different problem: a clear promise, relied on, with no consideration to support it. It is covered separately in promissory estoppel in Minnesota. And where the money is owed by a business but a person signed for it, the analysis shifts to personal guaranties.
Madgett Law, LLC
Madgett Law, LLC handles business and contract disputes in Minnesota state and federal court, including construction payment disputes, claims between owners and contractors, and cases where the parties’ dealings never got reduced to a signed agreement. If you are owed money and are not sure whether your claim is a contract claim, a lien claim, or an equitable one — that question is usually worth answering before a deadline answers it for you. Call 612-470-6529 or send us a message.
Sources: Minn. Stat. § 541.05, subd. 1(1) (six years for an action “upon a contract or other obligation, express or implied, as to which no other limitation is expressly prescribed”); Minn. R. Civ. P. 8.05(b) (pleading claims in the alternative, “whether based on legal or equitable grounds or both”); ServiceMaster of St. Cloud v. GAB Business Services, Inc., 544 N.W.2d 302 (Minn. 1996) at 305 (adequate remedy at law bars equitable relief) and 306 (elements of unjust enrichment; “unjustly could mean illegally or unlawfully”; contractor who does not use the mechanic’s lien statute gets no equitable aid; no enrichment where the defendant paid dollar-for-dollar); Caldas v. Affordable Granite & Stone, Inc., 820 N.W.2d 826 (Minn. 2012) at 838 (unjust enrichment as quasi-contract / contract implied in law; claim requires an implied-in-law or quasi-contract between the claimant and the party enriched; no claim where an enforceable applicable contract exists) and 838–39 (incidental third-party beneficiary cannot use unjust enrichment to escape lack of standing; quoting U.S. Fire Ins. Co. v. Minnesota State Zoological Board, 307 N.W.2d 490, 497 (Minn. 1981)); Southtown Plumbing, Inc. v. Har-Ned Lumber Co., 493 N.W.2d 137 (Minn. Ct. App. 1992) at 140 (elements; no equitable relief where an adequate legal remedy exists or where statutory standards for recovery are set by the legislature; subcontractors who abandoned mechanic’s liens could not recover) and 141 (distinguishing cases involving a lender that knowingly took advantage of the claimant); Breza v. Thaldorf, 276 Minn. 180, 183, 149 N.W.2d 276, 279 (1967) (proof of an express contract precludes recovery in quantum meruit); Sharp v. Laubersheimer, 347 N.W.2d 268, 271 (Minn. 1984) (reversing quasi-contract award to partner where an express partnership agreement governed); Sterling Capital Advisors, Inc. v. Herzog, 575 N.W.2d 121, 126 (Minn. Ct. App. 1998) (express contract precludes quasi-contract, unjust enrichment, or quantum meruit recovery); In re Distribution of Attorney’s Fees Between Stowman Law Firm, P.A., 870 N.W.2d 755 (Minn. 2015) at 767 n.2 (two meanings of quantum meruit), 761 (quantum meruit elements, quoting High), 763 (good-cause requirement for withdrawing contingent-fee counsel), and 766 (refusal to settle is the client’s decision); High v. Supreme Lodge of the World, Loyal Order of Moose, 210 Minn. 471 (1941) at 473 (quantum meruit elements: services rendered, circumstances implying a promise to pay, and their value) and 474 (benefit alone does not impose contractual liability).
This article is general legal information about Minnesota law. It is not legal advice, it does not create an attorney–client relationship, and it does not promise or imply any particular outcome. Statutes, rules, and case law change; verify current authority before relying on any of it.