Anderson v. Boyne USA, Inc.

CourtDistrict Court, D. Montana
DecidedJuly 7, 2022
Docket2:21-cv-00095
StatusUnknown

This text of Anderson v. Boyne USA, Inc. (Anderson v. Boyne USA, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Montana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Anderson v. Boyne USA, Inc., (D. Mont. 2022).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MONTANA BUTTE DIVISION

LAWRENCE ANDERSON, as trustee for

the LAWRENCE T. ANDERSON AND CV-21-95-GF-BMM SUZANNE M. ANDERSON JOINT

REVOCABLE LIVING TRUST, ROBERT

AND NORA ERHART, and TJARDA ORDER ON DEFENDANTS’ CLAGETT, MOTION TO DISMISS

Plaintiffs,

vs.

BOYNE USA, INC., BOYNE PROPERTIES, INC., AND SUMMIT HOTEL, LLC,

Defendants.

INTRODUCTION Defendants Boyne, USA, Inc., Boyne Properties, Inc., and Summit Hotel LLC (collectively “Boyne”) have filed a Motion to Dismiss for failure to state a claim upon which relief can be granted. (Doc. 3.) Plaintiffs oppose this motion. (Doc. 9.)

FACTUAL AND LEGAL BACKGROUND Boyne owns and operates Big Sky Resort, as well as three condominium- hotels at the base of Big Sky known as the Summit, Shoshone, and Village Center (collectively “the Condos”). (Doc. 9 at 11.) The majority of the Condos are owned

by private individuals, among them the Plaintiffs. (Id.) Plaintiff Larry Anderson (“Anderson”) owns a unit in the Shoshone. (Id.) Plaintiffs Bob and Nora Erhart (“Erharts”) own units in the Summit. (Id.) Plaintiff Tjarda Claggett (“Claggett”)

owns a unit in the Village Center. (Id.) Boyne owns all commercial units and some residential units. (Id.) Boyne marketed the Condos as investments to prospective purchasers and made representations regarding the economic benefits of ownership. (Id.) Title to

the Condos is subject to certain Declarations. (Doc. 4 at 8.) Boyne created the Declarations for the Condos and Boyne does not allow amendment to the Declarations without its consent. (Doc. 9 at 12.) The Declarations allow Condos to

be used either by the unit owners or as “transient hotel type accommodation.” (Id.) The Declarations require all unit owners to use Boyne, or an agent designated by Boyne, as their exclusive rental agents. (Id.) Unit owners may decline to renew the rental management contract with Boyne after three years, but only if 75% of unit owners vote to end the contract with Boyne. (Id.) Boyne itself owns all of the commercial units in the Village Center, which constitutes 22% of the voting units,

and several residential units as well. (Id. at 13.) Boyne prepared the rental-management agreements (“RMAs”) that unit owners sign with Boyne if they are not using their unit for personal use. (Id. at 14.)

The RMAs require unit owners to employ Boyne as their exclusive agent for the purposes of renting, managing, and operating the unit. (Id.) The RMAs require unit owners to pay Boyne 50% of gross rental revenue “after the payment of costs.” (Id.) Boyne charges unit owners for several services, per the RMAs, including

resort fees, credit card process fees, wholesalers and travel agent commissions. (Doc. 4 at 11.) Boyne also controls the central reservation center through which guests of the Condos make their reservations. (Doc. 9 at 15.) Boyne can use this

system to control pricing for each of the units and the order in which units are booked. (Id.) Plaintiffs brought this suit against Boyne arguing that their contracts with Boyne violate state and federal law. (Doc. 4 at 6.) Plaintiffs plead their claims as a

putative class. (Id.) Plaintiffs allege eight causes of action: (I) breach of fiduciary duty; (II) constructive fraud; (III) breach of contract; (IV) breach of the implied covenant of good faith and fair dealing; (V) unjust enrichment; (VI) antitrust

claims; (VII) accounting; and (VIII) declaratory relief claims. (Doc. 4 at 6–7.) LEGAL STANDARDS To survive a motion to dismiss, a complaint must contain sufficient factual

matter, accepted as true, to state a claim to relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). A claim has facial plausibility when the plaintiff pleads factual content that allows a court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Id.

DISCUSSION Boyne moves to dismiss all eight causes of action for failure to state a claim. (Doc. 4 at 6.) Boyne alleges that each cause of action is either (I) time barred or

(II) fails on the merits. (Id.) Boyne additionally argues that (III) Plaintiffs fail to state a plausible claim for class action relief. I. Whether Plaintiffs’ claims are time-barred. Boyne argues that the applicable statute of limitations bars all of Plaintiffs’

claims except for Clagett’s Breach of Contract, Accounting, and Declaratory Judgment claims. (Doc. 4 at 14.) Boyne bases its argument upon the belief that Plaintiffs claims began to accrue either when Plaintiffs signed their RMAs or when Plaintiffs received their first monthly statements from Boyne regarding rental

incomes. (Id.) Plaintiffs argue that their claims continue to accrue over time because they are suffering an ongoing injury. (Doc. 9 at 20.) Absent a repudiation of a contract that requires continuing performance, plaintiffs may sue for partial breaches only as they occur, and the statute of

limitations does not begin to run against a subsequent failure to perform until it occurs. Trustees For Alaska Laborers-Constr. Indus. Health & Sec. Fund v. Ferrell, 812 F.2d 512, 517 (9th Cir. 1987). Boyne argues that the continuing

claims doctrine fails to apply claims Plaintiffs allege a “single breach of contract.” (Doc. 12 at 4). The continuing claims doctrine does not apply to a claim based on “a single distinct event which has ill effects that continue to accumulate over time.” 54 C.J.S. Limitations of Actions § 198 (2022). Boyne misapprehends both

the continuing claims doctrine and the nature of Plaintiffs’ injury, as Plaintiffs have articulated it in their Complaint. Boyne contends that Plaintiffs “allege a single breach of contract” in

Paragraph 120 of their Complaint. This paragraph states as follows: “Boyne breached its agreements with Plaintiffs and class members by charging more than the rate provided for in the declarations of the Condo-Hotels.” (Doc. 1 at ¶ 120.) Boyne fails to explain how this allegation constitutes a single breach when the

“charging” at issue constitutes an ongoing part of Boyne’s contractual duties as Plaintiffs’ rental manager. Plaintiffs assert that a breach of contract occurred each time that Boyne allegedly overcharged them each month. (Id.) Boyne undermines its own argument when it states that Plaintiffs’ claims accrued at the latest “when they received their first monthly statements regarding

their rental incomes.” The fact that Boyne submits “monthly” statements to Plaintiffs demonstrates that Boyne’s contractual obligations, and the alleged breach thereof, are continuous. A contract that requires payment “on a monthly basis”

may be subject to “a series of partial breaches.” Ferrell, 812 F.2d at 517. Boyne cannot evade liability by arguing that Plaintiffs should have known when Boyne allegedly overcharged them the first time that Boyne would continue to do so for the foreseeable future. Each monthly statement Boyne issued with allegedly

inflated costs constitutes a partial breach of contract. Id. Plaintiffs’ claims have continued to accumulate so long as Boyne has acted as their rental manager, and, therefore, the claims are not time barred.

II. Whether Plaintiffs fail to state a claim on the merits. Boyne next argues that Plaintiffs fail to state any plausible claim on the merits. A claim has facial plausibility when the plaintiff pleads factual content that allows a court to draw the reasonable inference that the defendant is liable for the

misconduct alleged. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

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