Bird v. Crown Convenience (In re NWFX, Inc.)

SNEED, Circuit Judge,

concurring in part and dissenting in part.

I concur in part and dissent in part with the majority opinion. My disagreement is with the manner in which the opinion measures Rice’s unjust enrichment.

Judge Beam’s opinion concludes that the unjust enrichment of Rice did not include refunded proceeds. I disagree. Rice has been unjustly enriched by all of the proceeds that it has received from the sale of the money orders. The record in this case does not suggest that Rice had an obligation to refund its customers. It was not a guarantor of the money orders it sold. Holders of Northwest’s money orders have claims against Northwest, not Rice. Rice therefore should have turned over to Northwest all of the proceeds from its money order sales. Its decision not to do so kept its customers happy and maintained its good will at no cost to it. Northwest’s creditors, other than Rice’s customers, provided the funds by which Rice enhanced its reputation. Rice’s customers have received payment in full on their claims against Northwest while all other creditors of Northwest will not.

It is doubtful that Texas law supports the position of the majority. Its method of measuring Rice’s unjust enrichment stands in conflict with the authority the majority cites to support its finding that unjust enrichment has occurred. The Restatement of Restitution says that “[i]n an action of restitution in which the benefit received was money, the measure of recovery for this benefit is the amount of money received.” Restatement of Restitution § 150 (1936); see Holloway v. International Bankers Life Ins. Co., 354 S.W.2d 198, 213 (Tex.Civ.App.), rev’d on other grounds, 368 S.W.2d 567 (Tex.1962) (citing the chapter of the Restatement that includes section 150). The majority holds that a party is unjustly enriched, not to the extent it has received money, but to the extent the money received has not been dissipated. I do not think that the Texas courts would uphold such a rule.

My result would not impose on Rice a double liability, one to its customers and another to Northwest. Although the issue is not before the court, Rice, after reimbursing its customers, could assert their claims against Northwest. Rice could argue either that the customers assigned to Rice their money orders claims or that Rice acquired the customer’s claims under a theory of equitable subrogation. See Smart v. Tower Land and Inv. Co., 597 S.W.2d 333, 337 (Tex.1980). To the extent that Rice would not receive full payment on these claims in the bankruptcy court at distribution, to that extent it would have paid for the maintenance of its goodwill. Moreover, it would have paid for it with its own money.