Politino v. Azzon, Inc.

569 S.E.2d 447, 212 W. Va. 200
CourtWest Virginia Supreme Court
DecidedJune 24, 2002
Docket29766
StatusPublished
Cited by5 cases

This text of 569 S.E.2d 447 (Politino v. Azzon, Inc.) is published on Counsel Stack Legal Research, covering West Virginia Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Politino v. Azzon, Inc., 569 S.E.2d 447, 212 W. Va. 200 (W. Va. 2002).

Opinions

PER CURIAM:

This is an appeal by Azzon, Inc., and John P. See and Brenda See, from a summary judgment entered by the Circuit Court of Kanawha County in an action instituted by Sue Martin Politino. The appellant John P. See was ordered to pay Ms. Politino $83,643.53, together with interest, from January 15,1997. On appeal, the appellants claim that the circuit court erred in entering the summary judgment.

I.

FACTS

The appellant Azzon, Inc., is a corporation organized by John P. See and Rodney Politi-no on May 20,1993. Mr. See and Mr. Politi-no were also the officers and stockholders of the corporation.

[202]*202In 1994 and 1995, Azzon, Inc., borrowed substantial sums of money to finance its operations. Its borrowings were consolidated on September 25, 1995, in a $75,000 loan made by Merchant’s National Bank of Montgomery, West Virginia. Mr. See and Mr. Politino each personally guaranteed this loan. Additionally, Sue Martin Politino, Rodney Politino’s wife, who had already leased certain construction equipment which she personally owned, to Azzon, Inc., pledged other construction equipment, which she also personally owned, to secure the loan.

On November 17, 1995, without the knowledge or consent of John P. See, Rodney Politino and Sue Martin Politino incorporated Sue’s Reclamation & Construction, Inc., which was organized to engage in the same type of business as Azzon, Inc. When later asked why this corporation was organized, Sue Martin Politino stated that she “didn’t expect Azzon to eventually go on, and I have at the time four children to feed.”

After Sue’s Reclamation & Construction, Inc., was formed, Azzon, Inc., experienced increasing difficulty in its operations, and by December 1995, approximately a month after Sue’s Reclamation & Construction, Inc., was formed, Azzon, Inc., had defaulted on the lease of its business premises. Shortly thereafter, it was evicted from its premises. When this occurred, it left certain tangible personal property on the premises.

On March 1, 1996, Sue’s Reclamation & Construction, Inc., leased Azzon, Inc.’s, former business premises from Azzon’s former landlord. Also, in March 1996, Sue Politino repossessed equipment which she had leased to Azzon, Inc.

Azzon, Inc. failed to make the payments required under the note with the Merchant’s National Bank of Montgomery, West Virginia, and by letter dated August 21, 1996, Merchant’s National Bank notified Sue Martin Politino that it was demanding payment in full on the outstanding balance of the note. After receiving the notice, Sue Martin Politi-no agreed to pledge additional collateral to forestall further action by the bank.

In spite of this, in December 1996, Merchant’s National Bank demanded that Sue Martin Politino pay off the note. To forestall further action, Sue Martin Politino, after receiving this notice, on December 9,1996, paid $44,936.69 as a partial payment on the note.

Thereafter, by letter dated December 18, 1996, the bank notified Sue Martin Politino that it was demanding full payment of the remaining balance of $34,617.45, plus accrued interest. When Sue Martin Politino failed to make the additional payment, the bank repossessed the collateral which she had previously pledged for Azzon’s debt. To avoid loss of this collateral, Sue Martin Politino individually borrowed additional funds and paid the bank.

Subsequently, Sue Martin Politino instituted the present action against Azzon, Inc., and John P. and Brenda See, who had co-signed Azzon’s note to Merchant’s National Bank, claiming, among other things, that she was entitled to subrogation for the amounts which she had paid to the bank to repay her collateral. She did not sue her husband, Rodney Politino, who has also co-signed the note.

In response to Sue Martin Politino’s complaint, Azzon, Inc., and John P. and Brenda See filed an answer and a counterclaim in which they made several assertions relevant to the present appeal. First, they alleged that Rodney Politino, as an officer and director of Azzon, Inc., owed Azzon, Inc., and its shareholders, including John See, a fiduciary duty, and that this duty was breached when he had diverted business opportunities to Sue’s Reclamation & Construction, Inc., and when he had commenced working for Sue’s Reclamation & Construction, Inc.

They also, in effect, alleged that Sue Martin Politino was vicariously liable for Rodney Politino’s breaches of fiduciary duty in that she had entered into a civil conspiracy with Rodney Politino to commit the wrongs charged. They implicitly claimed that Sue Politino’s vicarious responsibility acted as a bar to her recovery and her subrogation claim.

They alleged that Sue Politino, both actively and vicariously, as a co-conspirator with Rodney Politino, had wrongfully converted [203]*203and taken possession of various equipment and assets owned by Azzon, Inc.

They claimed that to allow Sue Politino’s subrogation claim would create an unjust result. In essence, they claimed that, the improper conduct of Sue Politino, both personally, and as eo-conspirator with Rodney Politino, had impaired Azzon, Inc.’s ability to function and had contributed to then’ own enrichment, and that to allow Sue Politino to recover on her subrogation claim would result in her own unjust enrichment.

Subsequent to the filing of the initial pleadings, various motions and pleadings and depositions were filed, and ultimately the circuit court granted Sue Martin Politino summary judgment on her subrogation claim against John P. See in the amount of $83,643.53. The court, however, stayed enforcement of the order pending a resolution of the remaining claims in the case.

On August 31, 2000, the circuit court granted Sue Martin Politino summary judgment on the remaining issues affecting her right to recovery in the ease. The court made a number of findings and reached a number of conclusions relevant to the present appeal. First, the court found that there was no evidence that the Politinos or Sue’s Reclamation & Construction, Inc., had diverted any business opportunities from Azzon, Inc. Specifically, the court noted that the record was totally void of evidence suggesting that after Rodney Politino ceased working for Azzon, Inc., Azzon, Inc., made any effort whatsoever to obtain new contracts or to bid on new jobs, and the court said: “As a matter of law, Azzon cannot have been deprived of corporate opportunities that it never sought.”

Second, the court concluded that the only benefit which inured to Sue’s Reclamation & Construction, Inc., or to Sue Martin Politino from Rodney Politino came from the -work which Rodney Politino did for Sue’s Reclamation & Construction, Inc., and inferred that any wrongdoing associated -with this was the wrongdoing of Rodney Politino rather than Sue Martin Politino.

The court found that there was no evidence of a civil conspiracy on the part of Sue Martin Politino and Rodney Politino and inferred that in the absence of such a conspiracy, any wrongdoing on the part of Rodney Politino could not be imputed to Sue Martin Politino so as to effect Sue Martin Politino’s subrogation claim.

The court found that the property which was the subject of Azzon, Inc.’s conversion claim consisted of equipment which was left by Azzon, Inc., at its leased premises following its eviction as a tenant.

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Politino v. Azzon, Inc.
569 S.E.2d 447 (West Virginia Supreme Court, 2002)

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Bluebook (online)
569 S.E.2d 447, 212 W. Va. 200, Counsel Stack Legal Research, https://law.counselstack.com/opinion/politino-v-azzon-inc-wva-2002.