Fortune v. Parris

• Court: Superior Court of Maine
• Decided: November 3, 2011
• Docket: CUMcv-11-174
• Status: Unpublished

Opinion

STATE OF MAINE SUPERIOR COURT CUMBERLAND, ss. CML ACTION lJ;J;:lf DOCKETNO: CV- '7 RAe -C!)_M- 11)3/a-or, (.' ''

RIRCHARD FORTUNE, Nand ' \ '-~

RICHARD FORTUNE III & N, INC>

Plaintiff,

v. ORDER LEAVITT & PARRIS, INC.,

Defendant

LEAVITT & PARRIS, INC.,

Counterclaim Plaintiff v.

RICHARD FORTUNE, N and RICHARD FORTUNE, III & N, INC.

Counterclaim Defendant

Counterclaim defendants Richard Fortune, N, and Richard Fortune, III &

N, Inc. move jointly to dismiss part of Leavitt & Parris, Inc.'s counterclaim

because it fails to state a claim upon which relief can be granted. M.R. Civ. Pro.

12(b)(6).

BACKGROUND

On March 1, 2010, the counterclaim plaintiff Leavitt & Parris, Inc.

("Leavitt") purchased assets from counterclaim defendant Richard Fortune III &

IV, Inc. ("Fortune") pursuant to an Asset Purchase Agreement(" Agreement").

(Countercl.

against Fortune for failing to abide by the Agreement (Count I; Countercl.

1 13) and one against counterclaim defendant Richard Fortune, IV, ("Richard") in

his individual capacity (Count II; Countercl. 'li 29).

Additionally, Leavitt introduced tort claims arguing that Fortune and

Richard misrepresented or actively concealed asset values relevant to the

Agreement. (Count V; Countercl. 'li'li 44-45.) Leavitt also claims that Fortune

and Richard acted with malice, thus allowing for punitive damages (Count VI),

and that Fortune and Richard were negligent in their misrepresentation (Count

VII). (Countercl. 'li'li 53, 56.) Additional counts in the counterclaim are not part

of this motion.

DISCUSSION

I. STANDARD OF REVIEW

A motion to dismiss pursuant to M.R. Civ. P. 12(b)(6) tests the legal

sufficiency of the complaint or counterclaim. New Orleans Tanker Corp. v. DOT,

1999 ME 67, 'li 3, 728 A.2d 673 (citing Dexter v. Town of Norway, 1998 ME 195, 'li 7,

715 A.2d 169). The court reviews the complaint or counterclaim "in the light

most favorable to the plaintiff to determine whether it sets forth elements of a

cause of action or alleges facts that would entitle the plaintiff to relief pursuant to

some legal theory." Moody v. State Liquor & Lottery Comm'n, 2004 ME 20, 'li 7, 843

A.2d 43 (quotation marks omitted).

II. BREACH OF CONTRACT CLAIMS

The counterclaim defendants argue that the court should dismiss the

breach of contract claims to the extent they "involve contractual duties that were

waived by [Leavitt] at the time of closing." (Mot. Dismiss Countercl. 2.) "Waiver

is 'a voluntary or intentional relinquishment of a known right and may be

inferred from the acts of the waiving party."' Blue Star Corp. v. CKF Prop., LLC, et

2 al., 2009 ME 101, *26, 980 A.2d 1270 (quoting Interstate Indus. Unif. Rental Serv.,

Inc. v. Couri Pontiac, Inc., 355 A.2d 913, 919 (Me. 1976)). In order for a waiver to

bar enforcement of a known right it "must have induced a belief in the party who

is claiming reliance on that waiver that the waiving party intended voluntarily to

relinquish his rights." Id. (internal quotation marks omitted).

Defendants may rely on affirmative defenses, such as waiver, to dismiss a

claim "'if facts giving rise to the defense appear on the face of the complaint."'

Munjoy Sporting & Athletic Club v. Dow, 2000 ME 141, l:j[ 17, 755 A.2d 531 (quoting

Shaw v. S. Aroostook Cmty. Sch. Dist., 683 A.2d 502,504 (Me. 1996)). Reading the

counterclaim in the light most favorable to Leavitt, it is not clear that the rights

were waived. Even if the rights were waived, it is not clear that Fortune and

Richard were induced to believe that Leavitt "intended voluntarily to relinquish

[its] rights." Instead, the counterclaim indicates that Fortune and Richard

misrepresented information, thus making it impossible for Leavitt to properly

exert its rights prior to closing. (Opp'n Mot Dismiss Countercl. 8; Countercl. CJII:JI

49-50.) Therefore, the breaches of contract claims are not dismissed.

III. FRAUD & NEGLIGENT MISREPRESENTATION

The counterclaim defendants argue that the court must dismiss the fraud

and misrepresentation claims because they are purely based on breach of

contract claims and, therefore, merely duplicate earlier claims. (Mot. Dismiss

Countercl. 2.) Leavitt clearly alleged all of the necessary elements in the

counterclaim. Since Leavitt can properly make these tort claims along side the

contract claims Count V and Count VII are not dismissed.

A. Fraud

3 "There is a distinction ... between fraud that will vitiate a contract and

fraud that is actionable as deceit." Forbes v. Wells Beach Casino, Inc., 409 A.2d 646,

655 (Me. 1979). In order for Leavitt to sustain an action of deceit, "the

representations if material and false must be of some existing facts." Id. at 656

(quoting Albee v. Laroux, 119 A. 626 (Me. 1923)). Here, Leavitt clearly asserts that

Fortune and Richard fraudulently misrepresented some existing facts.

B. Negligent Misrepresentation

"Liability in tort may coexist with liability in contract, but only where

duty existing independent of the contract has been violated." Eldredge Lumber &

Hardware Inc., v. Lord, 2003 Me. Super LEXIS 252, *4 (Dec. 9, 2003). In its

counterclaim, Leavitt asserts that "Counterclaim Defendants had a duty to

exercise reasonable care or competence in obtaining or communicating the

information described herein." (Countercl.

pleading jurisdiction this statement is sufficient to exert the necessary duty and

assert, along with the other elements, a claim of negligent misrepresentation.

IV. PUNITIVE DAMAGES

Punitive damages are appropriate for tort claims only when the defendant

acted with malice. DiPietro v. Boynton, 628 A.2d 1019, 1024 (Me. 1993). Here,

Leavitt clearly claimed malice in the counterclaim (Countercl. 53.), and the tort

claims are not dismissed. Therefore, Count VI is not dismissed.

The entry is: The counterclaim defendant's partial

dismiss the counterclaim is denied.

DATE:

4 RICHARD FORTUNE IV ET AL VS LEAVITT AND PARRIS INC UTN:AOCSsr -2011-0035677 CASE #:PORSC-CV-2011-00174

01 0000002406 LAMBERT JOHN 477 CONGRESS STREET 14TH FLOOR PO BOX 15215 PORTLAND ME 04112-5215 F RICHARD FORTUNE, IV PL RTND 04/15/2011 F RICHARD FORTUNE III AND IV INC PL RTND 04/15/2011

02 0000002029 'MAWHINNEY, DANIEL THREE CANAL PLAZA PO BOX 4630 PORTLAND ME 04112-4630 F LEAVITT AND PARRIS INC DEF RTND 05/27/2011

03 0000008401 ~R~I~EL~L~Y~~B~R~E~N~D~AN~---------------------------------------- 10 FREE STREET PO BOX 4510 PORTLAND ME 04112 F LEAVITT AND PARRIS INC DEF RTND 05/27/2011 ~~~~~~~~~~~-----------------