Thank You For Submiting Feedback!
Where one erects a building upon the lands of another in the mistaken belief that he is the owner thereof, and the true owner, having knowledge of the improvement, does nothing to apprise the builder of the true situation, the builder is entitled to relief. Return of possession to the owner is conditioned upon his paying adequate compensation for the reasonable cost of the improvements or, in an appropriate case, they have permitted the builder of the improvements to retain the property upon paying its reasonable value to the true owner.
The tenant rented a one-family house from the landlord pursuant to a written lease. Despite a notice to vacate, the tenant continued in possession for approximately six and a half months after the expiration of the term of the lease. After the tenant had moved out, the landlord sued him, seeking compensation for damage which the tenant had allegedly caused to the property, twice the monthly rent pursuant to N.J.S.A. 2A:42-6 for the period during which he had remained in the house after the expiration of his lease, and an attorney's fee. The tenant brought a counterclaim and sought damages for the amount by which the landlord had allegedly been unjustly enriched as the result of improvements made by the tenant to the property in anticipation of his acquiring it under what he believed was his purchase option. The trial court dismissed the landlord’s claims and awarded the tenant damages. The landlord contended, among other things, that the trial court erred in permitting the jury to return a verdict based on an implied contract or quasi-contract when both parties had pled and relied upon an express contract dealing with the same subject matter.
Was the tenant entitled to relief because the tenant had made improvements the landlord's house as a result of a mistake which had been encouraged by the landlord?
The court affirmed the judgment of the trial court and held that the tenant made improvements to the landlord’s house as the result of a mistake, which the landlord encouraged or at least did not dispel, not about the location of boundary lines, but about whether he had a valid option to purchase the property for an agreed price. Upon those facts, the tenant was entitled to recover under a theory of quasi-contract or unjust enrichment.