
USCA1 Opinion

	




          July 27, 1993                            UNITED STATES COURT OF APPEALS                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                FOR THE FIRST CIRCUIT                                 ____________________        No. 92-2281                            COMMERCIAL ASSOCIATES, ET AL.,                                Plaintiffs, Appellees,                                          v.                                TILCON GAMMINO, INC.,                                Defendant, Appellant.                                 ____________________                                     ERRATA SHEET                                     ERRATA SHEET            The opinion of the  Court issued on July 22, 1993, is corrected as        follows:            On page 16, paragraph 3, line 2:  substitute "or" for "and."                                     UNITED STATES COURT OF APPEALS                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                FOR THE FIRST CIRCUIT                                 ____________________        No. 92-2281                            COMMERCIAL ASSOCIATES, ET AL.,                                Plaintiffs, Appellees,                                          v.                                TILCON GAMMINO, INC.,                                Defendant, Appellant.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                           FOR THE DISTRICT OF RHODE ISLAND                     [Hon. Ernest C. Torres, U.S. District Judge]                                             ___________________                                 ____________________                                        Before                                Boudin, Circuit Judge,                                        _____________                           Campbell, Senior Circuit Judge,                                     ____________________                              and Stahl, Circuit Judge.                                         _____________                                 ____________________            John R.  Fornaciari with whom Louis  V. Jackvony,  Jr., Jackvony &            ___________________           _______________________   __________        Jackvony,  Robert M.  Disch  and  Ross &  Hardies  were  on brief  for        ________   ________________       _______________        appellant.            William R. Landry  with whom Michael DiBiase, Karen A.  Pelczarski            _________________            _______________  ____________________        and Blish & Cavanagh were on brief for appellee, Lechmere, Inc.            ________________                                 ____________________                                    July 22, 1993                                 ____________________                 BOUDIN,  Circuit  Judge.    This action  arises  out  of                          ______________            efforts  to develop  a shopping  complex  known as  Bald Hill            Plaza  in Warwick, Rhode Island.  The plan was the brainchild            of  real  estate  developer  Anthony DelVicario,  who  was  a            general partner in a Massachusetts limited partnership called            Commercial Associates  ("Commercial").  Tilcon  Gammino, Inc.            ("Tilcon"), a construction company, learned about the project            and expressed interest to  DelVicario in obtaining a contract            to  do  certain  construction  work in  connection  with  the            project, primarily  site clearing and  grading.   DelVicario,            with   Tilcon's   assistance,   approached   Lechmere,   Inc.            ("Lechmere"), a Minnesota corporation  that operates a  chain            of retail stores, and persuaded Lechmere to join the  project            as one of the shopping center's "anchor stores."                 Lechmere purchased  the real  estate on which  its store            was  to be located, and  Commercial acquired the remainder of            the  property  needed  for  the development.    Lechmere  and            Commercial  entered into a written agreement--called the CORE            agreement-- which provided inter  alia that Commercial  would                                       _____  ____            be   responsible  for   the   site-clearing   work  and   the            construction  of   the  "footprint"  underlying   the  entire            shopping complex, including  the "pad" upon which  Lechmere's            store would be  built.  In consideration,  Lechmere agreed to            pay Commercial $1.3 million.  Commercial then retained Tilcon            to  serve as  the  general contractor  for the  site-clearing                                         -2-                                         -2-            work.  Commercial and Tilcon entered  into a written contract            dated February  8, 1985, which generally  described the scope            of  the work  to  be performed  by  Tilcon and  contained  an            estimated total  cost of "about $2,800,000."   Tilcon started            the site-clearing work around that same time.  DelVicario was            the  supervisor   of  the   project  and   directed  Tilcon's            activities at the work site on a daily basis.   Lechmere  had            wanted  the pad  completed by  March 15,  1985, so  its store            could open  that September in  time for the  holiday shopping            season.   At least in part to meet that timetable, DelVicario            insisted  that Tilcon accelerate its work schedule, requiring            Tilcon's  staff to  work  overtime  and  necessitating  extra            equipment and supplies.  And, according to Tilcon, DelVicario            insisted that Tilcon perform substantial work at the shopping            center  site that  went  beyond the  description  of the  job            contained in the  February 8 contract; Tilcon refers to these            additional tasks as "extras."                   Work was completed on schedule, but a dispute soon arose            as  to  Tilcon's compensation.   Tilcon  claimed that  it was            entitled  to  additional  compensation for  the  "extras"  it            performed at DelVicario's  direction.  Commercial disagreed--            it believed  that Tilcon had agreed to  a "guaranteed maximum            price"  and had  been paid  in full--and  refused to  pay the            final three  bills  submitted  by  Tilcon.   Tilcon  filed  a            mechanic's  lien on the property  under Rhode Island law, and                                         -3-                                         -3-            on February 7, 1986, brought an action against Commercial and            Lechmere in Rhode Island Superior Court to enforce that lien.            Pursuant  to the  Rhode Island  statute, Commercial  posted a            $1.2 million bond to release the lien, and the action proceed            in rem against the bond.1            __ ___                 Following  a seven-day  bench trial  the superior  court            found in favor of  Tilcon.  In  a 28-page opinion, the  court            found  that  Tilcon  was  not bound  by  the  estimated price            contained  in the  original February  8 contract.   The court            found  that Tilcon was bound by a maximum price of $3,095,000            contained in a May 8 letter  to Commercial, but that a number            of tasks were excluded  from this price.  Finally,  the court            found that Tilcon  was entitled to  compensation on a  "cost-            plus"  basis for  numerous  "extras" performed  at the  site,            pursuant to the oral assurances of DelVicario.                 Under Rhode Island  law Tilcon could recover in the lien            enforcement  proceeding only  for  work performed  within the            120-day  period prior  to notice  of the lien  (the so-called            "lien period").   The court expressly  found that Tilcon  was            entitled to compensation for work performed prior to the lien                                            ____________________                 1The  mechanic's lien statute  provides that respondents            can  secure  the release  of a  lien  by depositing  with the            registry of the court  "cash equal to the total amount of the            accounts  and demands  of all  persons claiming  liens" or  a            surety bond in that amount in lieu of cash.  R.I. Gen. Laws              34-28-17.  In this case, Commercial deposited a  $1.2 million            bond with the registry  and, apparently without any objection            from Tilcon as to the amount, the lien was discharged.                                         -4-                                         -4-            period,  but held  that  it had  no  power to  include  these            amounts in  its judgment.   The  court left it  to Tilcon  to            "pursue this claim in another appropriate proceeding."                   The   Rhode  Island   court  entered   judgment  against            Commercial and Lechmere for $1,329,207.03,  which represented            the court's  painstaking calculation of the  compensation due            Tilcon for work at the Bald Hill site during the 120-day lien            period.   Tilcon,  however, was  able  to collect  only  $1.2            million,  the  amount of  the bond  that  had been  posted to            release the  lien, leaving a $129,207  deficiency between the            judgment   and  Tilcon's  recovery.    The  superior  court's            decision was  affirmed in  all respects  by the  Rhode Island            Supreme Court.   Tilcon Gammino, Inc.  v. Commercial Assocs.,                             ___________________________________________            570 A.2d 1102 (R.I. 1990).                 During the pendency  of the mechanic's lien  proceeding,            Lechmere  and Commercial filed  this separate  action against            Tilcon  in Rhode  Island  Superior Court  seeking damages  of            their  own  arising out  of the  Bald  Hill project.   Tilcon            removed  the  action  to  federal  district  court  based  on            diversity  of  citizenship.   It  also  filed a  counterclaim            against Lechmere and Commercial seeking payment for work that            was  not  recoverable  in  the  lien  action--the  deficiency            between the judgment and the  bond, and compensation for work            done prior to the  lien period--on various theories including            breach of contract, unjust enrichment and fraud.                                          -5-                                         -5-                 After the final decision in the  lien case, Tilcon moved            for  summary judgment  on  its counterclaim  in this  action.            Tilcon argued that the Rhode  Island Superior Court had found            as  a matter  of  fact  that  DelVicario bound  Lechmere  and            Commercial to  a series  of oral  contracts with  Tilcon, and            that  Tilcon was  owed  specific amounts  for work  performed            under those  contracts.   Tilcon claimed that  Commercial and            Lechmere  were collaterally estopped  from relitigating these            issues, and that Tilcon was therefore entitled to judgment as            a  matter  of law  for the  $129,207 discrepancy  between the            superior  court's judgment  and  the $1.2  million bond,2  as            well as approximately $600,000 for work at the Bald Hill site            prior to the lien period.                 The district  court agreed that Commercial  and Lechmere            are bound  by the Rhode  Island court's factual  findings but            only  those that were necessary  to its judgment.   Thus, the            court  held  that  the  Rhode  Island  decision  conclusively            established that  Tilcon was owed an  additional $129,207 for            work  performed  during the  lien period.   But  the district            court  concluded  that  the  Rhode Island  decision  did  not            resolve the issue of  who was liable for the  deficiency, nor                                  ___                                            ____________________                 2Tilcon claims  that it is  entitled to recover  in this            case  the  entire  $1,329,207  amount  of  the  Rhode  Island            judgment.  But it  is undisputed  that Tilcon  recovered $1.2            million by executing on the bond, and Tilcon does not explain            why  it is entitled to more than the $129,207 discrepancy for            the lien period.                                         -6-                                         -6-            did  it  establish Tilcon's  entitlement to  compensation for            work prior to the lien period.  The case  proceeded to trial.            The original  claims of  Lechmere and Commercial  having been            dismissed,  the  case was  now  limited  to Commercial's  and            Lechmere's liability, if  any, for work done  by Tilcon prior            to  the lien  period.   The dispute  was further  narrowed by            stipulations.   Pursuant  to its  prior ruling,  the district            court  instructed  the jury  that  certain  facts, primarily,            Tilcon's  entitlement to  $129,207 for  work done  during the            120-day period, had been  established in prior litigation and            should not  be reconsidered.   The court  therefore precluded            the parties from introducing any evidence regarding work done            during the lien period.  It was determined that liability for            the $129,207  deficiency would  be imposed upon  whichever of            the  defendants was  held  liable at  trial for  the pre-lien            work.                 At  trial, Tilcon  introduced  evidence seeking  to show            that Commercial  and  Lechmere  were  liable  for  additional            payments for work done outside the lien period.  At the close            of  Tilcon's case the court  granted judgment as  a matter of            law  for Lechmere  with respect  to all  of Tilcon's  claims,            leaving only  the claims against Commercial;  the reasons for            the court's  ruling are more conveniently  discussed later in            this opinion.  The jury  then returned a verdict in  favor of            Tilcon against  Commercial for $307,500.   The district court                                         -7-                                         -7-            added  to this  amount  the $129,207  deficiency between  the            judgment in the mechanic's  lien action and the bond,  made a            number of other adjustments to reflect the stipulations among            the  parties, and  then entered judgment  in favor  of Tilcon            against Commercial for the resulting amount of $268,903, plus            prejudgment interest on a certain portion of the debt.                  Tilcon now  appeals.   It argues  that the Rhode  Island            court's factual findings, if given  proper preclusive effect,            required that judgment for the $129,207 deficiency be entered            against Lechmere  as well as against  Commercial.  Commercial            has  not made any appearance  in this appeal;  if the limited            partnership  is a  defunct  or insolvent  entity, that  might            explain  why it is important  to Tilcon to  obtain a judgment            against  Lechmere.    Tilcon   also  argues  that  collateral            estoppel made  Lechmere and  Commercial both liable  for some            $600,000 in work  done prior to the  lien period and  that it            was error to submit this issue to  the jury, which found only            $307,500 due  from Commercial.    Finally, preclusion  aside,            Tilcon argues that the  court erred by granting  judgment for            Lechmere as a matter of law on each of Tilcon's claims.                   We start  by considering  the collateral  estoppel issue            before turning to Tilcon's individual claims against Lechmere            and  Commercial.  "Federal courts  are bound by  state law on            the preclusive effect of state judgments."  Carillo v. Brown,                                                        ________________            807 F.2d  1094, 1101 (1st  Cir. 1986);  see also 28  U.S.C.                                                      ___ ____                                         -8-                                         -8-            1738;  Gonsalves v. Alpine Country Club, 727 F.2d 27, 29 (1st                   ________________________________            Cir. 1984).  Thus, the district court was obliged to give the            Rhode Island  Superior Court's decision  the same  preclusive            effect  that the  Rhode Island  courts themselves  would give            that decision.                   In  order for  the  doctrine of  collateral estoppel  to            apply under  Rhode Island law, "several  requirements must be            satisfied:   there must be  an identity of  issues; the prior            proceeding must  have resulted  in a  final  judgment on  the            merits;  and the  party against  whom collateral  estoppel is            sought must  be the same as  or in privity with  the party in            the prior proceeding."   State  v. Chase, 588  A.2d 120,  122                                     _______________            (R.I. 1991).  Like  a set of Chinese boxes,  the identity-of-            issues  element, which is the  crucial one in  this case, has            three components of its  own:  "[F]irst, the issue  sought to            be  precluded must be identical  to the issue  decided in the            prior proceeding;  second, the issue must  actually have been            litigated; and  third, the  issue must necessarily  have been            decided."  Id. at 123.                       __                 In addition,  Rhode Island  courts, consistent  with the            prevailing  approach,  "allow  themselves   a  good  deal  of            latitude  in  applying  the  rule [of  collateral  estoppel],            observing the spirit of it rather than the letter."   Hill v.                                                                  _______            Bain,  15  R.I.  75,  23 A.  44  (1885);  see  also Klein  v.            ____                                      ___  ____ _________            Commissioner,  880 F.2d  260,  264 (10th  Cir. 1989)  ("Trial            ____________                                         -9-                                         -9-            courts  are granted  broad discretion  in the  application of            collateral estoppel.").  We  think this "latitude" was vested            in  the district  court  below, as  it  was sitting  in  this            diversity case as a surrogate for a Rhode Island tribunal.                  Tilcon's principal argument is  that the district  court            failed  to give proper preclusive effect  to the Rhode Island            Superior  Court's finding  that DelVicario  was acting  as an            agent  of Lechmere  and as  such bound  Lechmere to  the oral            contracts  with Tilcon.    Tilcon's argument  is  based on  a            single paragraph  in the  superior court's decision  in which            the  court stated  that DelVicario,  in making  assurances of            payment  to Tilcon,  was "acting  within the  scope of  [his]            authority  for  and  on  behalf  of  .  .  .  Commercial  and            Lechmere," and therefore bound his principals to the contract            modifications.   We agree with  the district  court that  the            issue of Lechmere's contractual relationship with  Tilcon was            not one that "must necessarily have been decided" in the lien            proceeding, and  therefore  is  not  entitled  to  preclusive            effect under Rhode Island law.  Chase, 588 A.2d at 123.                                            _____                 The "necessarily decided" element of collateral estoppel            means in this  context that  an issue was  not only  actually            decided but also necessary to the judgment.  See  Restatement                                                         ___            (Second) of Judgments    27 (determination must be "essential            to the judgment").  The reasons for this condition are that a            collateral  issue,  although it  may  be  the  subject  of  a                                         -10-                                         -10-            finding, is  less likely to receive  close judicial attention            and the  parties  may well  have  only limited  incentive  to            ___            litigate  the issue fully since it is not determinative.  See                                                                      ___            Wright,  Miller &  Cooper, Federal  Practice and  Procedure                                         ________________________________            4421 at 193 (1981 ed.).  Under these circumstances, extending            the force of the unnecessary finding into a different case is            deemed too risky and possibly unfair.                 Liability under the Rhode Island mechanic's lien statute            is not dependent on contract.  The statute creates a right of            action against a parcel of property whenever improvements are            made "by  oral or  written contract  with or  at the  oral or                                                      ___________________            written request of" the  landowner.  R.I. Gen. Laws    34-28-            __________________            1(a) (emphasis  added).3   Thus, Lechmere's liability  in the            superior court  suit (or  more technically, the  liability of            Lechmere's property) flowed from its status as owner  and the            fact  that  Tilcon's   work  on  the  property  was  done  at            Lechmere's request.   A "request,"  of course, is  a far  cry                                            ____________________                 3Deleting   irrelevant   language,   the  Rhode   Island            mechanic's lien statute provides as follows:                 Whenever any  building .  . . or  other improvement                 shall be  constructed  . .  .  by oral  or  written                 contract with or  at the oral or written request of                 the owner  thereof, . .  . such building  . .  . or                 other  improvement,  together  with  the  land,  is                 hereby made liable and shall stand subject to liens                 for  all  the  work  done  by  any  person  in  the                 construction . . . of such  building . . . or other                 improvement,  and  for  the  material  used in  the                 construction  .  .  .   thereof,  which  have  been                 furnished by any person.                                         -11-                                         -11-            from  a  contract.    To  be  sure,  findings  regarding  the            existence  and  terms  of  the  contract  governing  Tilcon's            assignment at the work site were necessary to a determination            of  the amount of Tilcon's lien, since under Rhode Island law                    ______            the  amount of  the  lien is  dependent  upon the  underlying            contract.  See Art Metal Constr. Co.  v. Knight, 56 R.I. 228,                       ___ ________________________________            185  A. 136  (1936).   But  whether  that contract  was  with            Commercial  alone,  or Commercial  and Lechmere  jointly, was            irrelevant.  All that mattered was that Tilcon was acting "at            [Lechmere's] request," a fact that was undisputed.4                  But we do  not rest  entirely upon this  parsing of  the            lien statute.   If a factual issue  were vigorously litigated            in  a  prior proceeding  and were  the  focus of  the court's            decision,  preclusion might  well be  appropriate even  if in            hindsight  it  could be  shown that  the  issue was,  in some            sense, not strictly essential  to the outcome.  After  all, a            factual  determination is  not inherently  untrustworthy just            because the result could  have been achieved by a  different,            shorter and more efficient route.  In this case, however, the            single  sentence in question seems  to us to  fall within the            principle that  "if an inquiry  reveals that the  matters had            `come under consideration only collaterally or incidentally,'                                            ____________________                 4The  Rhode  Island  Supreme Court's  opinion  refers to            Lechmere only twice.   It  does not say  that DelVicario  was            Lechmere's  agent,  nor  does  it  suggest  that  privity  of            contract  between  Lechmere and  Tilcon  is  relevant to  the            outcome.                                         -12-                                         -12-            preclusion  is  denied."    Federal Practice  and  Procedure,                                        ________________________________            supra,   4421 at 194 (quoting Norton v. Larney, 266 U.S. 511,            _____                         ________________            517 (1925)).                 The Rhode Island  Superior Court states  that DelVicario            was an  agent of  Lechmere only at  one point in  its 28-page            decision, and there only in passing, somewhat cryptically and            without  any explanation or analysis.  A few pages earlier in            the decision, the court states that DelVicario was "acting as            Commercial's agent and representative  at the job site," with            no mention of Lechmere.  We  do not think it is at  all clear            that,  in the later, single sentence relied on by Tilcon, the            superior  court   meant  to  determine  that  DelVicario  was            Lechmere's agent for purposes  of creating a contract between            Lechmere and  Tilcon.5  We  conclude that this  "finding" was            collateral and not preclusive; and we rest this conclusion on            the joint force  of three  considerations:  the  lack of  any            legal  need  for a  finding of  such an  agency, the  lack of            clarity in  the supposed  finding, and the  earlier, explicit            statement that DelVicario was Commercial's agent.                                              ____________________                 5The later sentence relied upon  by Tilcon occurs in the            context  of a  discussion rejecting  Commercial's claim  that            "extras"   authorized  by  DelVicario  did  not  enlarge  the            liability of Commercial under the written contract; and it is                         __________            at  least possible  that the  court meant  no more  than that            DelVicario spoke  for  Commercial and  that Lechmere,  having            contracted   with   Commercial,   was  stuck   with   limited            responsibility for  DelVicario's extras that  flows from  the            mechanic's lien statute.                                         -13-                                         -13-                 Tilcon also  argues that the district  court should have            given preclusive effect to  the Rhode Island superior court's            findings as  to the amount  owed Tilcon  for its work  at the            Bald  Hill  site  prior to  the  start  of  the lien  period.            Although  the Rhode Island court did make some findings as to            amounts owed for certain items of pre-lien work,  it declined            to do so for other items, stating that it had  no power under            the mechanics lien statute to award compensation for the pre-            lien work.  Accordingly,  the pre-lien findings are on  their            face matters that it was not necessary to decide.                 Tilcon seeks  to rescue  these findings by  arguing that            they were necessary in order to determine the validity of the            "guaranteed maximum price" defense  put forward by Commercial            and Lechmere.   Under Rhode Island law, to the  extent that a            contractor  has promised  to do a  job for  a fixed  sum, the            amount  that  can   be  collected  for  that  job  under  the            mechanic's lien  statute is  limited to the  contract maximum            less whatever payments have already been made.  See Art Metal                                                            ___ _________            Constr. Co., 185  A. at  146-47.   Therefore, Commercial  and            __________            Lechmere  argued in the lien case that the guaranteed maximum            price  agreed  to by  Tilcon  represents  an outer  limit  of            recovery.   To  reject the defense,  says Tilcon,  the extras            done  prior  to  the  lien  period  had  to  be  individually            analyzed.                                         -14-                                         -14-                 This argument  is imaginative  but not persuasive.   The            Rhode  Island trial judge  ultimately rejected the guaranteed            maximum price defense on multiple grounds:  he found that the            original   contract  price  relied  upon  was  a  preliminary            estimate and that the later binding price was higher, covered            only work done after  May 8, and covered only  work specified            in  the contract  and not  numerous extras.    The guaranteed            maximum price defense then faded  from view in his  decision,            and there was no careful summing up of the pre-lien extras in            order to reject the  defense.  Indeed, as already  noted, the            judge  declined to quantify a number of pre-lien items on the            ground that they were not compensable.                 In  the  end,  it is  not  clear  why  the Rhode  Island            Superior  Court made specific findings as to some of the pre-                                                         ____            lien items.  He  did not explain why he did  so and the issue            was not discussed on appeal.  But there is no indication that            the  trial  judge  in the  lien  case  followed  the line  of            reasoning urged by  Tilcon.  It is up  to Tilcon to establish            the requisites  for collateral estoppel, see Federal Practice                                                     ___ ________________            and  Procedure, supra,    4420 at 185,  and in  our view this            ______________  _____            effort fails as  to the  pre-lien period findings.   This  is            enough  for our  purposes  although we  note that  Lechmere's            liability  would not  be  affected since--as  we shall  see--            Lechmere is not liable in any event.                                         -15-                                         -15-                 The district court's  ruling on the collateral  estoppel            issues did  not prevent  Tilcon from attempting  to prove  at            trial  in  this case  that Lechmere  in  fact entered  into a            contract with Tilcon, or that Lechmere is liable to Tilcon on            one of the other theories set forth in Tilcon's counterclaim.            Tilcon  did attempt to prove such liability, but at the close            of Tilcon's  case the  district court  entered judgment as  a            matter  of law  in  favor of  Lechmere  on each  of  Tilcon's            claims.   Tilcon  says this  was error  as to  three claims--            breach of contract, quantum meruit, and unjust  enrichment6--                                _______ ______            but we agree with the district court's entry of judgment.                 At trial, Tilcon attempted  to prove that DelVicario was            acting as an agent  of Lechmere when he made  oral assurances            to  Tilcon that  it  would  be  paid  for  the  "extra"  work            performed  at the  site,  and therefore  bound Lechmere  to a            series  of oral agreements.  The question posed, on review of            a directed verdict, is whether  a reasonable jury could  only            have  reached the same conclusion as the trial court, and our            review  is  plenary.   See NewHarbor  Partners, Inc.  v. F.D.                                   ___ __________________________________            Rich. Co.,  961  F.2d 294,  298  (1st  Cir. 1992).    We  are            _________            convinced that  there was  insufficient evidence to  permit a                                            ____________________                 6Tilcon's  remaining  claims  were  fraud,  constructive            trust, and violation of  the Racketeer Influenced and Corrupt            Organizations  Act ("RICO"), 18 U.S.C.     1961 et  seq.  The                                                            __  ___            RICO  count was dismissed prior  to trial, and  judgment as a            matter of law was entered on the fraud and constructive trust            counts.  Tilcon does not pursue these claims on appeal.                                         -16-                                         -16-            reasonable  jury  to find  that  DelVicario was  an  agent of            Lechmere capable of binding Lechmere to a contract.                 Under Rhode Island law, agency  may be based upon either            actual authority and  apparent authority.   See Menard &  Co.                                                        ___ _____________            Masonry Building  Contractors v.  Marshall Bldg. Sys.,  Inc.,            ____________________________________________________________            539  A.2d  523,  527  (R.I. 1988)  (adopting  formulation  of            Restatement (Second)  of Agency).  The  first theory requires            evidence of an actual understanding between the principal and            agent  that the latter  is to  act on  behalf of  the former.            There  was  no suggestion  at trial  of any  actual agreement            between Lechmere and DelVicario  under which the latter would            act  as  Lechmere's  agent  with respect  to  the  Bald  Hill            project.    Accordingly,  Tilcon  presses only  a  theory  of            apparent authority.                   Apparent   authority   "arises   from  the   principal's            manifestation of such  authority to the  party with whom  the            agent contracts."  Menard & Co. Masonry Building Contractors,                               _________________________________________            539 A.2d at 526.  In other words, the focus is on the conduct            of the principal, not the putative agent.  The principal must            act  in a way  that leads a  third party to  believe that the            agent is authorized  to act on the  principal's behalf, here,            authorized  to  enter   into  contractual  arrangements   for            Lechmere with Tilcon.  And, finally, the third party's belief            in  the agent's authority to  act on behalf  of the principal                                         -17-                                         -17-            must be a reasonable one.  See Rodrigues v. Miriam Hosp., 623                                       ___ _________________________            A.2d 456 (R.I. 1993); Restatement (Second) of Agency   267.                   Here, the only evidence of any representations and other            conduct  by Lechmere regarding DelVicario's authority was the            testimony of Thomas Gammino, Tilcon's chief engineer and vice            president, that Lechmere's people instructed Tilcon to follow            DelVicario's  instructions  on  the   job  site.    But  that            statement would  not permit  a reasonable person  to conclude            that  DelVicario's promises regarding  payment for  work were            the promises of Lechmere.  Indeed, the statement is perfectly            consistent with the  opposite interpretation:   that Lechmere            was  leaving  the  site-clearing   work  to  Commercial   and            Commercial's man  DelVicario, and  was keeping its  own hands            out of it.  This is also true of the fact that DelVicario may            have  been  motivated  in  directing Tilcon's  actions  by  a            timetable  and  other  requirements  imposed  by Lechmere  on            Commercial.    Tilcon  points  to no  other  evidence  of any            actions  by Lechmere  affirming  DelVicario's authority,  and            this gap in proof is fatal to Tilcon's contract claim against            Lechmere.                 In  addition,  even  if  Tilcon in  fact  believed  that            DelVicario  represented Lechmere,7  no reasonable  jury could                                            ____________________                 7In fact, the trial testimony  was quite equivocal as to            whether  Tilcon actually believed that DelVicario represented            Lechmere.  Only two witnesses testified for Tilcon:  its vice            president, Thomas Gammino;  and its foreman at the  Bald Hill            site, Robert Pion.   Both witnesses described DelVicario as a                                         -18-                                         -18-            have found that  belief justifiable.   At the  outset of  the            project  Tilcon joined forces with DelVicario to make a sales            pitch to Lechmere; there is no suggestion that DelVicario had            any prior affiliation with  Lechmere.  Gammino testified that            it was Tilcon's practice to enter into written contracts with            all parties with whom Tilcon dealt, yet Tilcon  never entered            into  or  sought  to  enter  into  a  written  contract  with            Lechmere.   Before beginning  work Tilcon performed  a credit            check  on Commercial,  but made  no such  inquiries regarding            Lechmere.                 Nor  did Lechmere take  a more prominent  role once work            began.  The May  8 letter containing a binding  maximum price            was  submitted  by Tilcon  to  Commercial,  not to  Lechmere.            Tilcon  submitted all  its bills  to Commercial  for payment.            Lechmere  was never  involved in  the billing  process, never            asked to examine any of Tilcon's invoices, and never made any            direct payments to Tilcon.   Even when the final  three bills            went   unpaid,  Tilcon   did   not  look   to  Lechmere   for            compensation.  Lechmere was  simply one of the  anchor stores            in  a larger  project developed  by Commercial.   It  was not            until  litigation, and  the need  for a  deeper pocket,  that            Lechmere was brought into the fray.                                             ____________________            representative of Commercial.  But Gammino did testify at one            point (after considerable  hedging) that he  "believed . .  .            that Tony  Delvicario was in  charge for  both people,"  i.e.                                                                     ____            Commercial  and Lechmere, and  so we will  assume that Tilcon            introduced enough evidence, if barely, to show actual belief.                                         -19-                                         -19-                 We  also  agree  with  the  district  court's  entry  of            judgment for  Lechmere on  the unjust enrichment  claim.   To            recover on a  theory of unjust enrichment  under Rhode Island            law, the plaintiff must  show that it conferred a  benefit on            the  defendant  "in  such  circumstances  that  it  would  be            inequitable for  the defendant to retain  the benefit without            payment to  the plaintiff  for the  value thereof."   Anthony                                                                  _______            Corrado,  Inc. v. Menard  & Co.  Bldg. Contractors,  589 A.2d            __________________________________________________            1201,  1202  (R.I. 1991).   This  claim  under state  law was            equitable  and was tried to the district judge.  We share the            district court's  view that Tilcon offered  "no evidence that            would suggest that the enrichment  [to Lechmere] if there was            any  was unjust,"  and therefore  need not  concern ourselves            with the standard of appellate review on this issue.8                 As  the district court noted, virtually  all of the work            done by Tilcon  at the Bald Hill  site benefitted all  of the            participants in  the  project--including Commercial  and  the            other stores  in the shopping complex--and  Tilcon offered no            principled way of isolating  the economic benefit to Lechmere            alone.   The district  court also found  that Lechmere's CORE                                            ____________________                 8Courts   have   disagreed  whether   unjust  enrichment            presents  a question of fact that is reviewed under a clearly            erroneous standard,  or a question  of law reviewed  de novo.                                                                 __ ____            Compare Commodity  Futures Trading Comm'n v. Heritage Capital            _______ _____________________________________________________            Advisory Servs., Ltd.,  823 F.2d  171, 172  (7th Cir.  1987),            _____________________            with In  re Estate of Zent, 459  N.W.2d 795, 798 (N.D. 1990).            ____ _____________________            Needless  to  say,  such  an  all-or-nothing  choice  is  not            compelled.                                         -20-                                         -20-            agreement with Commercial included a payment to Commercial to            arrange  for  the  site-clearing  work.   Tilcon  offered  no            evidence that the benefit to Lechmere resulting from Tilcon's            work at the site  exceeded that payment.  Finally,  the court            traced  the   relationship   between  Tilcon   and   Lechmere            throughout the  project and concluded,  based on the  many of            the same factors recited above, that Tilcon had no reasonable            expectation of  compensation from  Lechmere for work  done at            the site.                 Tilcon  suggests  that the  court's  collateral estoppel            ruling  precluded the  introduction of  any evidence  of work            done  during  the lien  period  and  deprived Tilcon  of  the            opportunity  to  show  that  work  done  during  that  period            specifically benefitted Lechmere.  But there is no indication            that the  work  done  during  the lien  period  was  uniquely            beneficial to Lechmere.   We  also do not  agree with  Tilcon            that the  district court  erroneously believed that  proof of            fraud  was  necessary  in  order  to  recover  on  an  unjust            enrichment  theory.    Rather,  the  court  merely  observed,            consistent  with Rhode Island case law, that the existence of            fraud or other wrongdoing is  a factor in determining whether            the retention of  a benefit  would be inequitable.   See  R&B                                                                 ___  ___            Elec. Co., 471 A.2d at 1354.             _________                 Turning  finally to the quantum meruit  claim, this is a                                         ______________            quasi-contract claim which, as the district court noted, is a                                         -21-                                         -21-            close cousin  to the  equitable remedy of  unjust enrichment.            Historically,  the claim allowed  a party to  collect for the            value of services or supplies  furnished to another, based on            an implied (at  law) promise to  pay, even though all  of the            requisites  of a formal contract  might not be  present.  See                                                                      ___            Farnsworth,  Contracts,    2.20 at  103 (2d  ed. 1990).   The                         _________            district  court  made clear  that,  even if  this  claim were            directed against  Lechmere, the court would  direct a verdict            on it for essentially the same reasons given  by the court in            ruling on the unjust enrichment claim.9                   In  its brief in  this court, Tilcon  chooses instead to            assimilate its  quantum meruit  claim to its  contract claim,                            ______________            stressing  as  to  both  claims  the  same  facts  concerning            DelVicario's actions in directing the work to meet Lechmere's            deadlines.  The chameleon character  of quasi-contract claims            is  such that  Tilcon can  fairly stress  this  affinity with            contract.  But this in turn means that Tilcon must have had a            reasonable basis for looking to Lechmere for payment, and for            reasons already given we do not think that there was any such            relationship  between Lechmere  and  Tilcon,  either real  or            reasonably  imagined by  Tilcon.   See generally  Farnsworth,                                               ___ _________                                            ____________________                 9The  district court  believed  with considerable  basis            that in Tilcon's complaint the  quantum meruit claim, as well                                            ______________            as  the  contract claim,  had  been  directed solely  against            Commercial;  but in each case the district court ruled in the            alternative  that the claim lacked merit so we do not discuss            the pleading issue further.                                          -22-                                         -22-            supra, at 107 ("Nor can a party that has made a contract with            _____            another   generally   disregard   the   contract   and  claim            restitution  from a  third  person for  performance  rendered            under the  contract, even if the third  person has benefitted            from that performance.").                   In sum, we think that the district court ably sorted its            way through a complex commercial dispute, further complicated            by  the prior determinations in the mechanic's lien case.  It            may well be that Tilcon has not recovered all that it is due,            possibly because of default by the  partnership with which it            contracted  and partly because of its failure to insist on an            adequate bond in the lien proceeding.  But the decision to do            the work  without a contract with or  guarantee from Lechmere            was  Tilcon's  own  decision.   There  was  no  error in  the            district court's rulings.                 Affirmed.                 ________                                         -23-                                         -23-
