STATE OF MAINE BUSINESS AND CONSUMER COURT CUMBERLAND, ss. Location: Portland DKT. NO. BCDWB-CV-2019-32
FORREST BRADBURY, ) ) Plaintiff, ) ) v. ) ORDER FOR ENTRY OF ) JUDGMENT ) WILBOURN CONSTRUCTION, LLC, et ) al., ) ) Defendants. )
The Court held a bench trial in this matter over six days: January 25-29, 2021, and February
11, 2021, on the remaining claim in this matter, Plaintiff’s allegations that Defendants are liable
for fraud. Plaintiff is represented by Attorney Paul S. Bulger and Defendant Ed Wilbourn is
represented by Attorney Sigmund D. Schutz. The Court has reviewed the evidence in this matter,
including a number of transcripts that were prepared, as well as the parties’ written arguments, the
last of which was received by the Court on April 22, 2021. 1 For reasons stated, the Court finds
that the Plaintiff has failed to prove his claim of fraud by clear and convincing evidence. Judgment
will be entered for Defendants. 2
STANDARD OF REVIEW
The parties agree on the elements a party asserting a claim of fraud must prove. Plaintiff
Forrest Bradbury must prove each of the following elements by clear and convincing evidence:
1 Although the Court permitted Plaintiff to file a Reply, the Court did not receive one. 2 Defendants have renewed in writing their Motion for Judgment as a Matter of Law on this claim. While the Court does have the authority to consider this argument at the conclusion of all the evidence, the Court declines to analyze the fraud claim under that standard. The parties expended significant effort in presenting evidence and make oral and written argument; the Court will exercise its discretion to analyze the whole record on the merits.
1 1) That a party made a false representation;
2) The representation was of a material nature;
3) The representation was made with knowledge of its falsity;
4) The representation was made for the purpose of inducing another party to act in reliance
on it; and
5) The other party justifiably relied upon the representation as true and acted upon it to
the party’s detriment.
Barr v. Dyke, 2012 ME 108, ¶ 16, 49 A.3d 1280. Plaintiff notes that if there is no affirmative
misrepresentation, a party in his position can still establish fraud if there is active concealment of
truth by a defendant. McGeechan v. Sherwood, 2000 ME 188, ¶ 61, 760 A.2d 1068.
Clear and convincing evidence requires the party with the burden “to place in the factfinder
an abiding conviction that the truth” of the allegations is “highly probable.” Randall v. Conley,
2010 ME 68, ¶ 14, 2 A.3d 328.
FINDINGS AND CONCLUSIONS
Forrest Bradbury and Ed Wilbourn may have at one time been capable of agreeing upon
many things, but it is perhaps an understatement to say that is no longer the case. Over the course
of a six-day trial, Mr. Bradbury and Mr. Wilbourn and their witnesses painted very different
portraits of their business history, their personal history, and their views of each man’s character
and credibility. Both parties describe a long-standing friendship, but it has always been
intertwined with a number of business projects over the course of decades, some more successful
than others. The ventures include a number of drilling and construction projects, and a land
development project in Virginia, R Income Properties, LLC. The latter project, a partnership
owned by Mr. Bradbury, Mr. Wilbourn and others, required significant investment in the form of
2 a “infrastructure loan,” as Mr. Wilbourn calls it, and the entity Wilbourn Construction, LLC was
used in part to make payments for both parties towards that obligation.
The parties have very different personalities and business philosophies. Mr. Bradbury is
now 86 years old and has limited formal education, but he has extensive “hands on” experience in
construction, especially in drilling, which he has done since approximately 1951. Mr. Bradbury
despises paperwork and freely admitted that he often failed to file personal as well as business tax
returns. Mr. Wilbourn has more formal education, and sees himself as far more ethical than Mr.
Bradbury, but he apparently knew about Mr. Bradbury’s penchant for avoiding “paper trails” that
could lead to problems with tax authorities; or as Mr. Bradbury put it, paperwork is a “trail to jail.”
Nevertheless, Mr. Wilbourn agreed to work with him on a number of businesses in a number of
states for a number of years. Around the time the parties began discussing formation of the drilling
business that is at the heart of this contentious litigation, Mr. Bradbury, according to his wife, had
credit that was “shot” and the IRS had levied their personal bank accounts. According to Mr.
Wilbourn, he was willing to form the business and work with Mr. Bradbury so long as his home
mortgage payments were covered by business income.
While Mr. Bradbury seems to argue that he had been deceived by Mr. Wilbourn in this
regard about the amount of the mortgage payments, and how long the payments were to be made,
it is clear from the records admitted that these payments were regularly made to Mr. Wilbourn
until their relationship fell apart in 2018. Mr. Wilbourn claims that the business they formed is
owned 50/50 by both. Initially formed as Northeast Drilling, LLC in August of 2011,
approximately 7 months later it became Wilbourn Construction, LLC.3 Mr. Bradbury held a 1%
3 The articles of formation for this entity were put together by Attorney Rick Winling, a criminal defense attorney who is Mr. Bradbury’s neighbor. He testified that these two LLCs were the only LLCs he had ever formed. He was not asked to and did not draft any operating agreement for the entities, nor did he prepare any banking resolutions or voting resolutions for them. His only ongoing involvement was to file
3 interest himself, while 49% was held by his company Maine Foundation, LLC. Mr. Wilbourn also
held a 1% personal interest, with 49% held by Edpattiw, LLC which is a company he formed with
his wife Patti Wilbourn. While the business records admitted suggest that this was a 50/50
ownership arrangement, Mr. Bradbury’s closing argument claims otherwise. His counsel explains
that it was Mr. Bradbury’s understanding that while Mr. Wilbourn could use business income to
cover his personal mortgage, Mr. Bradbury “did not promise him a partnership. He did not promise
him a payment sufficient to cover his debt service to R Income Properties. Bradbury viewed the
position as a part-time accounting job for a limited period of time sufficient for Mr. Wilbourn to
complete the sale of land owned by R Income Properties, LLC, sufficient to get out from the big
mortgage.” In addition, Mr. Bradbury claims that someone forged his name on the formation
documents. However, his own expert, Dennis Ryan, contradicted this allegation, as did his
attorney in his closing argument.
The parties do seem to agree that with respect to Wilbourn Construction, LLC, Mr.
Wilbourn was in charge of the financial and administrative side of the company while Mr.
Bradbury worked in the field on the projects. Mr. Bradbury also was in charge of bidding and
supervising the contractors and subcontractors. The parties lived approximately 1200 miles apart
during the events that triggered this litigation, and only met once or twice a month as needed. Mr.
Bradbury conceded that Mr. Wilbourn had authority to borrow money for equipment.
The parties also seem to agree Wilbourn Construction was doing relatively well up until
2018 when their personal relationship – and whatever trust they had left in one another – dissolved
into acrimony. Mr. Wilbourn claims that Mr. Bradbury led him to believe that the company was
annual reports with the State for the parties as their registered agent. He also testified that Mr. Bradbury instructed him to get information from Mr. Wilbourn for purposes of completing the paperwork. He is also the registered agent for Maine Foundation, Mr. Bradbury’s LLC.
4 owed a very large debt by Ziegenfuss Drilling, which is owned by a long-time business associate
of Mr. Bradbury, Mark Ziegenfuss. In addition, Mr. Bradbury insisted they should continue to
loan a very expensive piece of equipment to Mr. Ziegenfuss despite there being no writing to
memorialize what if any agreement was in place regarding the terms of its use. Mr. Wilbourn
testified that he believed Ziegenfuss was supposed to make periodic rental payments on the
equipment, while Mr. Ziegenfuss, who is now himself involved in litigation against Mr. Bradbury,
insists he was supposed to be charged only by the linear foot. There is no written instrument in
evidence that would enable the Court to know what the agreement actually required. An in-person
meeting in New Jersey with the parties and Mr. Ziegenfuss failed to resolve the dispute about the
equipment and escalated into a war of words between them in person and in writing.
During the early stages of this litigation, counsel for Mr. Bradbury demanded documents
from Mr. Wilbourn which were not, in the view of the Court, timely provided. While Mr. Bradbury
insists that this delay bolsters his claims of fraud, the Court would note that the information was
eventually provided in time for the parties to reach at least partial agreement on some issues. In
addition, contrary to Mr. Bradbury’s claims that he never received any tax information from Mr.
Wilbourn, he did in fact receive K-1s regularly, and he also received complete business tax returns
for a number of years directly from the accountant, Peter Chase, who worked for the company
until approximately 2017. In addition, Mr. Bradbury’s name is on bank statements admitted, and
his wife testified at some length about her own system of paying certain bills and receiving income
from customers. The “bible,” as she called her handwritten log of deposits, is however of limited
usefulness in creating a balanced picture of whether any company income was misappropriated by
either party, as it does not show, for example, the payments the company paid directly for the
Bradburys’ tax obligations and credit card debt, among other things.
5 Mr. Bradbury also claims that Mr. Wilbourn misappropriated a large “credit” with a drill
company, Davey Kent. It is not clear to the Court why this credit was so large and why it was
carried for so long, but it is clear that Mr. Bradbury had some concern about Davey Kent’s ability
to pay it in cash and that he was also aware the company had been for sale at some point in time.
The credit was due and payable by Davey Kent to Northeast Drilling, Inc. Thomas Myers,
President of Davey Kent, testified that he was contacted by Mr. Wilbourn, who ordered equipment
including a DK-525 drill. In the course of the equipment transactions, Mr. Wilbourn asked that
the remaining credit balance be used to clear the Northeast Drilling account. At some point, after
Mr. Wilbourn told him he was not a member of Northeast, Mr. Myers requested that Mr. Wilbourn
produce an authorization permitting him to transfer the credit to Wilbourn Construction. Davey
Kent received an authorization which, by its terms, permitted the credit to be transferred to the
Wilbourn Construction account. Mr. Myers testified that Mr. Bradbury had earlier identified Mr.
Wilbourn as his partner at Wilbourn Construction, and that Mr. Bradbury told him to deal with
Mr. Wilbourn, despite the long-standing relationship between Mr. Bradbury and Mr. Myers.
However, Mr. Bradbury now claims he never gave Mr. Wilbourn this authority, and that the
documents had to have been forged by Mr. Wilbourn. Mr. Bradbury’s expert did testify that the
signature on the authorization did not match Mr. Bradbury’s; he was, however, unable to say if the
signature was Mr. Wilbourn’s. Mr. Wilbourn suggests that if it was not signed by Mr. Bradbury,
it was instead signed either by Mrs. Bradbury or by the company bookkeeper, Donna Mayo, who
did not testify.
In January 2014, when the drill ordered by Mr. Wilbourn was almost ready, Davey Kent
invoiced Wilbourn Construction for $22,956.91, the amount owed after the Northeast Drilling
credit was applied. On January 9, 2014, Mr. Myers states in an email that the purchase was
6 intended to clear the accounts “between the various companies.” The authorization that was sent
to Mr. Myers on February 14, 2014, was the original authorization without a fax “header” while a
faxed copy with the header was clearly sent from Mr. Bradbury’s fax machine in Maine (for Maine
Foundation, LLC) to Mr. Wilbourn in Virginia.
The drill was eventually manufactured delivered by Davey Kent, and it used by Wilbourn
Construction. Mr. Wilbourn recorded the credit on the books of Wilbourn Construction as a capital
contribution in favor of Maine Foundation, Mr. Bradbury’s company.
Both parties have broken down a number of issues and/or events, including those described
above, and in their written arguments have analyzed the events under the law of fraud. After
considering the parties’ categorizations, the Court can identify a number of them that could
constitute fraud, if Mr. Bradbury can carry his burden of proving the required elements of fraud
by clear and convincing evidence. The Court will address the issues separately.
Company payments toward the personal expenses of the owners
As a threshold matter, the Court finds that the parties did agree that the enterprise of
Wilbourn Construction was a 50/50 ownership arrangement. Mr. Bradbury’s claims to the
contrary are not credible given Mr. Winling’s testimony and the formation documents, and
therefore both parties were entitled to receive distributions. In addition, it is clear both parties
benefited from this arrangement, such as it was. Mrs. Bradbury’s personal credit card was paid
for by business income, along with the Bradbury’s personal insurance and federal tax indebtedness.
Veterinary services for the Bradbury’s farm animals were charged and a Florida vacation were
paid for in part by business income. Mr. Bradburn also acknowledged that he approved of
Wilbourn Construction paying for both of their personal expenses.
7 The question then becomes whether Mr. Wilbourn fraudulently caused these distributions
to be made to Mr. Bradbury’s detriment. David Gowen, Mr. Bradbury’s own accountant, testified
that Mr. Bradbury received half of all distributions from 2014 to 2018 to which he was entitled. If
distributions in years prior to 2014 are analyzed (as they were by Jim Beavers, a friend of Mr.
Wilbourn, who with Mr. Wilbourn analyzed all distributions made from 2012) it appears likely
that Mr. Bradbury received more than half. The Court found the testimony of both Mr. Gowen
and Mr. Beavers to be credible.
The Court concludes that in the face of this evidence, no claim for fraud can be made out
by the Plaintiff as to business distributions, including the payment of personal expenses of the
owners.
Payment of Mr. Wilbourn’s mortgage by Wilbourn Construction
Mr. Bradbury claims that there was no agreement to pay Mr. Wilbourn’s mortgage beyond
two years. As with other claims made, there is no writing to clarify what the agreement, if there
was one, entailed. There is only the history of payments, and the basically uncontested testimony
from both parties that the payments were an important factor which persuaded Mr. Wilbourn to
join with Mr. Bradbury in the creation of Wilbourn Construction, LLC. Importantly – as pointed
out by Defendants – if there was a “breach” of any particular agreement, that claim could be
brought under a theory of contract, but this is a fraud case. There is scant, if any evidence, that
Mr. Wilbourn did anything to conceal these payments. Mary Sherman, who worked in the field
alongside Mr. Bradbury and other employees and contractors, testified that it was well understood
that these payments were being made to Mr. Wilbourn for his mortgage, and the Court found Ms.
Sherman to be a credible witness. It was clear that it pained her to describe how the company
came apart, and her views on why that happened. She displayed no animus towards Mr. Bradbury
8 and described how she came to conclude that it was primarily his conduct that caused the business
to founder.
Mr. Bradbury does seem to conflate the payment of the Mr. Wilbourn’s mortgage with his
complaints about Mr. Wilbourn making payments toward the Virginia project. The latter payments
would arguably benefit both parties. Fundamentally, however, Mr. Bradbury has failed to prove
fraudulent intent – either by concealment or misrepresentation – by clear and convincing evidence
that the payments of Mr. Wilbourn’s mortgage constituted fraud.
Unpaid equipment rental
The Court agrees that Plaintiff is making what appears to be a new claim that Mr. Wilbourn
personally owes approximately $119,000 in unpaid lease payments to Maine Foundation. Mr.
Bradbury points to payments made in 2013 and 2014 which ceased at the end of 2014. Mr.
Bradbury’s counsel argues that the “Wilbourn process” of making payments allowed him to make
lease payments, or not, “as it suited him. There was no written lease or payment arrangements.”
The “Wilbourn process,” as he calls it, does appear irregular. However, Plaintiff’s counsel’s
statement that “there was no written lease or payment arrangement” undermines any claim of
fraudulent intent on Mr. Wilbourn’s part. Plaintiff has therefore failed to prove fraudulent intent
by clear and convincing evidence.
The Davey Kent transaction
As noted previously, it was never made clear to the Court why such a large credit owed to
Maine Foundation was kept on the books of Davey Kent for the length of time it was. However,
subsequent transactions and actions taken by both parties undermine Mr. Bradbury’s claim that
Mr. Wilbourn’s conduct constitute fraud.
9 First, it would be a stretch to find concealment by Mr. Wilbourn of a material fact. Mr.
Myers indicated that he preferred to deal with Mr. Bradbury given their long history, but it was
Mr. Bradbury who told him to deal with Mr. Wilbourn about the equipment purchases. In addition,
it was Mr. Wilbourn who told Mr. Myers that he was not an owner of Maine Foundation, LLC,
meaning he could not sign on that entities behalf; in other words, hardly the action of someone
trying to pull the wool over the eyes of Mr. Myers.
Perhaps in recognition of these difficult facts, Mr. Bradbury insists that his signature on
the authorization was a forgery. As already noted, the handwriting expert, Mr. Ryan, found himself
at odds with Mr. Bradbury’s claim of another act of forgery, namely Mr. Bradbury’s signature on
formation documents. But more problematic was Mr. Ryan’s inability to say who signed the
authorization, if in fact it was not Mr. Bradbury. It seems highly unlikely to the Court that Mr.
Wilbourn gained control over the Maine Foundation fax machine to send himself a forged fax. It
seems far more likely that Mrs. Bradbury or the Maine foundation bookkeeper both of whom
worked regularly at the place where the fax machine was situated, signed Mr. Bradbury’s signature
at his request.
The forgery argument is also undercut by the fact that the purchase of the valuable money
making drill, made possible by application of this longstanding credit, actually benefited both
parties. Again, clear and convincing evidence of fraudulent intent is lacking on this record.
Loans from nonowners
Mr. Bradbury claims Mr. Wilbourn is personally responsible for loans made to Wilbourn
Construction, LLC by family and friends of Mr. Wilbourn. First, it should be noted that the loans
about which Mr. Bradbury complains were in fact reflected on the company books and were used
for company purposes. While Mr. Bradbury casts suspicion on the timing of these loans, noting,
10 for example, that they were borrowed as company revenues declined, which enabled Mr. Wilbourn
to continue to have his mortgage paid by the company. However, having already found that the
mortgage payments were authorized, it would be difficult for the Court to conclude that the
continuation of these payments during hard times for the company constitute fraud. Such un
reduced payments may have been imprudent assuming, they were paid while the company was
foundering, but negligence, even gross negligence, is not the same as fraud. Moreover, Mr.
Bradbury also arranged for his daughter to loan money to the company, and the evidence suggests
that the loans to the business from sources tied to both parties were treated the same on the
company books, and the loans all appear to have benefited the company. Finally, Mr. Beavers
credibly testified that Mr. Bradbury not only knew about the loan he made to the company but
thanked him for it.
The Plaintiff has failed to prove by clear and convincing evidence that the loans made by
friends and family members of Mr. Wilbourn were orchestrated by him with fraudulent intent.
CONCLUSION
For the reasons stated, Plaintiff has failed to prove by clear and convincing evidence that
Defendants committed fraud against him. The entry will be: Judgment will be entered for
Defendants, who are awarded their costs. This Order for Entry of Judgment shall be noted on the
record pursuant to Rule 79(a) of the Maine Rules of Civil Procedure.
Dated: _________________ _____________________________ Hon. M. Michaela Murphy Justice, Maine Superior Court