Bennett Heating & Air Conditioning, Inc. v. NationsBank

654 A.2d 949, 103 Md. App. 749, 1995 Md. App. LEXIS 53
CourtCourt of Special Appeals of Maryland
DecidedMarch 3, 1995
DocketNos. 899, 900
StatusPublished
Cited by16 cases

This text of 654 A.2d 949 (Bennett Heating & Air Conditioning, Inc. v. NationsBank) is published on Counsel Stack Legal Research, covering Court of Special Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bennett Heating & Air Conditioning, Inc. v. NationsBank, 654 A.2d 949, 103 Md. App. 749, 1995 Md. App. LEXIS 53 (Md. Ct. App. 1995).

Opinion

BLOOM, Judge.

Appellants, Bennett Heating & Air Conditioning, Inc. and four other subcontractors, performed construction work on a commercial building located on property that was owned by appellee Ammendale Business Campus Limited Partnership (Ammendale LP). The property was subject to three deeds of trust securing loans made by Sovran Bank/Maryland, which is now known as NationsBank of Maryland, N.A. (NationsBank). NationsBank foreclosed on the deeds of trust and sold the property.

Appellants, who have never received payment for the work and materials they put into the construction of the commercial building on the property, brought an action in the Circuit Court for Prince George’s County against appellees, Nations-Bank, Ammendale LP, ELV/Ammendale I, Inc. (ELV/Ammendale), Carfax Enterprises Limited Partnership (Carfax), Banbury Associates Limited Partnership (Banbury LP), and Banbury Real Estate Investment, Inc. (Banbury Investment).1 Appellants’ complaint was amended three times; the Third Amended Complaint sought to set aside the foreclosure sale on the basis of fraud (Count I) and asserted claims for breach of contract, unjust enrichment, and quantum meruit (Counts II through VIII). NationsBank and the other four appellees [754]*754collectively filed motions to dismiss most of the counts in the complaint, pursuant to Md. Rule 2-322(b), for failure to state a claim upon which relief could be granted. The circuit court granted those motions and entered a judgment dismissing the entire complaint. Appellants timely noted a consolidated appeal to this Court, in which they present the following issues, which we have reordered:

I. Whether the subcontractors’ Third Amended Complaint (Count I) states grounds to set aside the foreclosure sale.
II. Whether the subcontractors’ Third Amended Complaint (Counts II, III, IV, VI, and VIII) states a claim in quantum meruit against the defendants.
III. Whether the subcontractors’ Third Amended Complaint (Counts V and VII) states breach of contract claims against defendants Ammendale Business Campus Limited Partnership and ELV/Ammendale I, Inc.

FACTS

Appellants’ version of the facts, which we accept as true for purposes of reviewing the lower court’s grant of appellees’ motions to dismiss, is as follows.

Ammendale LP, which is owned and controlled by a group of British investors represented by David B. Law (British Investors), purchased property in Prince George’s County known as Ammendale Business Campus (the property) in 1987. Ammendale LP had received loans from NationsBank to finance the acquisition of the property and the construction of six commercial buildings to be located on the property. The loans were secured by three deeds of trust on the property. From 1990 to early 1991, the British Investors and NationsBank discussed the funding of a sixth building on the property and the possible re-negotiation of Ammendale LP’s original financing of the property.

In November 1989, after five buildings had been constructed, Ammendale LP contracted with Michael, Harris & Rosato Brothers, Inc. (MHR), the general contractor, for the con[755]*755struction of the sixth commercial building (Building F) for $1,427,529. Ammendale LP also contracted with MHR in June 1990 for tenant improvement work on Building F for $180,881. MHR subcontracted with appellants to perform work required under MHR’s contracts with Ammendale LP. MHR and appellants completed their work on Building F in 1990.

On 29 October 1990, MHR filed suit to establish a mechanics’ lien on the property. This lien included the amount owed to the appellants for their work on Building F. Two appellants, Bennett Heating and Air Conditioning, Inc. (Bennett) and D & L Electric, Inc. (D & L) obtained final orders establishing mechanics’ liens on the property on 28 November 1990 and 15 March 1991.

In March 1991, Ammendale LP, which still owed Nations-Bank $28,592,806, defaulted on its loans. NationsBank, through substituted trustees, instituted foreclosure proceedings on the property, which was Ammendale LP’s only asset. At the time of the foreclosure, Ammendale LP still owed MHR $902,884 under the contract to build Building F and the entire $180,881 under the contract for tenant improvements to the building. Appellants had not received any payment for their work.

On 22 March 1991, the property was sold at foreclosure for $21,050,000 to the sole bidder, Metropolitan Commercial Properties (Metropolitan), a subsidiary of NationsBank. Metropolitan then assigned its rights as purchaser to Banbury LP, which is owned and controlled by the British Investors. This assignment and substitution was ratified by the Circuit Court for Prince George’s County in May 1991.

To finance its purchase of the property, Banbury LP borrowed $18,675,000 from NationsBank and agreed to pay NationsBank “additional yield” up to $3,479,038 contingent upon the proceeds derived from the property by Banbury LP. Banbury LP borrowed an additional $1,000,000 from Nations-Bank to finance improvements to the property. These loans are secured by three deeds of trust on the property.

[756]*756After the ratification of the foreclosure sale in May 1991, appellants Bennett, D & L, and Anne Arundel Fire Protection, Inc. filed a complaint against appellees, seeking damages for unjust enrichment, quantum meruit, and breach of contract. In December 1991, that complaint was amended to include appellant William Dale Judy (Judy) as a plaintiff and to add a fifth and sixth count to the complaint. NationsBank filed a Motion to Dismiss or, Alternatively, for Summary Judgment, which the court granted.

Appellants thereafter filed a Second Amended Complaint, adding appellant Dennis Stubbs Plumbing, Inc. as a plaintiff and also adding a seventh count to the complaint. Although the Second Amended Complaint named NationsBank as a defendant, appellants stated that they were not pursuing any claims against NationsBank since the court had granted NationsBank’s motion for dismissal of the complaint as to it. Banbury LP and Banbury Investment then filed a Motion for Summary Judgment, and a few days later ELV Ammendale filed a Motion for Partial Summary Judgment and Carfax filed a Motion for Summary Judgment.

Appellants, in turn, filed a Motion to Vacate Dismissal of Defendant NationsBank of Maryland. The circuit court, after hearing arguments on that motion and on appellees’ motions for summary judgment, concluded that appellants’ quantum meruit and unjust enrichment claims were barred unless the foreclosure sale were set aside. The court granted leave for appellants to amend their Second Amended Complaint.

Appellants then filed their Third Amended Complaint, which included NationsBank as a defendant and added a count petitioning the court to set aside the foreclosure sale on the basis of fraud. Appellees countered with motions to dismiss various counts of the Third Amended Complaint. The court granted those motions and dismissed the entire complaint. This appeal is from that judgment.

Banbury LP presently owns and operates the property as a commercial business park. The first five buildings constructed on the property are occupied fully by tenants, and Building [757]*757F has a tenant in the space improved by appellants’ work and materials.

DISCUSSION

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Bluebook (online)
654 A.2d 949, 103 Md. App. 749, 1995 Md. App. LEXIS 53, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bennett-heating-air-conditioning-inc-v-nationsbank-mdctspecapp-1995.