SPIVEY v. ADAPTIVE MARKETING (September 20, 2010)

Quinten Spivey ordered a diet product over the telephone from Adaptive Marketing in early 2003. Adaptive Marketing claims that its representative continued the conversation and told Spivey that she would send him a "risk free" 30-day membership in HomeWorks (apparently some kind of retail discount program), that he could cancel the membership within 30 days, that he would be billed $96 per year if he did not cancel, and that the membership would renew automatically each year. Spivey, on the other hand, claims that he does not recall the conversation and that he never received membership materials (or, if he did, that they were designed to look like junk mail). In any event, Adaptive Marketing charged Spivey's credit card $96.00 in 2003, $149.95 in 2004, $199.95 in 2005, $199.95 in 2006, and an unknown amount in 2007. Each charge was shown as "HomeWorks" and included a reference telephone number. Spivey brought suit for breach of contract and unjust enrichment. Judge Reagan (S.D. Ill.) granted summary judgment to Adaptive Marketing on the contract claim concluding, in the alternative, that a) there was both an oral and written contract that Adaptive Marketing did not breach, and b) Spivey's claim is barred by the voluntary payment doctrine. The court also granted summary judgment on the unjust enrichment claim on the alternative bases that a) unjust enrichment is not available where a contract exists, and b) recovery is barred by the voluntary payment doctrine. Spivey appeals.

In their opinion, Associate Justice (Ret.) O'Connor and Circuit Judges Kanne and Rover affirmed. The Court did not address the contract theories, resting its holding solely on the voluntary payment doctrine. Under that doctrine, one cannot recover money that has been paid under a claim of right even if paid under a mistake of law, unless there is fraud, coercion or a mistake of fact. Spivey asserts a mistake of fact -- that he assumed for four years but the charges related to purchases made by his wife (she is a teacher and he thought a charge for “HomeWork” must be hers). The Court rejected the mistake of fact claim: each charge was properly identified and included a telephone number, each charge listed the name of the product that he was given in the original telephone call, he never asked his wife about the charges, and he never called the number on his credit card statement about the charges. Illinois law does not accept a mistake of fact claim when the true facts are not obscured and the mistake is a result of the plaintiff's failure to investigate or inquire.