silence rising to the level of false information on the nce of an environmental hazard on property
How later courts described this case
- silence rising to the level of false information on the nce of an environmental hazard on property
Written by the judges who cited it.
The opinion
CUMBERLAND, ss. CIVIL ACTION
STATE OF MAINE SUPERIOR COURT / /
DOCKET NO. CV-04-214 //
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SRG S, Che Me
HHH, LLC, Alp 4 2 Co, 18 Of
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Plaintiff, 8 Eo L004
v. E / Vgopper
PORT HARBOR MARINE, INC,
PORT HARBOR HOLDINGS |
HERBERT E. TYLER, GRACE M. TYLER,
IRVING OIL CORPORATION, and
LAWYERS TITLE INSURANCE CORPORATION,
Defendants.
‘AUG 20 2008
Before the court the Defendants Port Harbor Marine, Inc. (Marine), and Port
Harbor Holdings I (Holdings) (collectively Port Harbor), move to dismiss Plaintiff
HHH, LLC’s (HHH), complaint.
HHH opposes this motion and makes a cross-motion to consolidate this action
with the case entitled Port Harbor Marine, Inc. and Port Harbor Holdings Iv. HHH,
LLC, CV-03-380 (Previous Action) in the Cumberland County Court.
Port Harbor and Irving Oil Corporation (Irving) object to the motion to
consolidate.
Lawyers Title Insurance Coroporation (Lawyers Title) opposes the motion to
consolidate.
Irving moves to dismiss Count I and Count II of HHH’s amended complaint.
Irving also moves for sanctions under MLR. Civ. P. 11.
HHH opposes Irving’s motion to dismiss Count I and Count II, and opposes
Irving’s motion for sanctions.’
FACTS AND PROCEDURAL HISTORY
In this case, HHH purchased 20.76 acres of land in South Portland from Irving.
In early July, HHH began installing fencing along the property line. On or about July 8,
2003, Port Harbor brought the Previous Action against HHH for allegedly blocking a
right of way.
On or about July 11, 2003, the Superior Court in Cumberland County, Brodrick,
J., issued an order granting Port Harbor a preliminary injunction preventing HHH from
installing the fencing.
In October, 2003, HHH hired new counsel for this matter. Mediation sessions
which were unsuccessful were held between the parties. On or about March 22, 2004,
HHH’s counsel moved to continue the trial date to amend its answer and implead other
parties. This order was granted by this court.
On March 30, 2004, the instant action was filed, alleging breach of contract and
specific performance against Irving; breach of contract against Lawyers Title Insurance
Company; quiet title, declaratory judgment, and breach of contract against Herbert E.
Tyler and Grace M. Tyler; and declaratory judgment and quiet title against Port Harbor.
HHH now alleges that Irving breached its agreement with HHH to terminate certain
easements, and that the Tylers and Port Harbor did not fulfill its agreements with HHH
to clear title to the property which HHH bought.
DISCUSSION
Motions to Dismiss
1 : - ws :
HHH also cross-moved for summary Judgment in its opposition to Irving’s motion to dismiss.
The motion for summary judgment will not be ruled upon at this time.
2
A motion to dismiss tests the sufficiency of the complaint. See MLR. Civ. P. 12.
When reviewing a motion to dismiss, the material allegations of the complaint are
accepted as true. Id. Dismissal for failure to state a claim is appropriate only where it
appears beyond doubt that the Plaintiff is entitled to no relief under any set of facts
which he might prove in support of his claim. Dutil v. Burns, 674 A.2d 910, 911 (Me.
1996).
Port Harbor argues that the claims that HHH brings against it in this case should
have been brought against it in the Previous Action under M.R. Civ. P. 13(a). HHH
counters that the motion should be denied and the court should consolidate this action
with the Previous Action.
Rule 13(a) provides, in pertinent part:
(1) Pleadings. Unless otherwise specifically provided by statute... a
pleading shall state as a counterclaim any claim which at the time of
serving the pleading the pleader has against any opposing party, if it
MLR. Civ. P. 13(a). “Under principles analogous to res judicata, a defendant who fails to
assert a compulsory counterclaim, as required by Rule 13(a) of the Maine Rules of Civil
Procedure, ‘is precluded from later maintaining another action on the claim after
rendition of judgment.’” Morse Bros., Inc. v. Mason, 2001 ME 9, 15, 764 A.2d 267, 269
(quoting KeyBank Nat'l Ass’n v. Sargent, 2000 ME 153, [17, 758 A.2d 528, 534).
In this case judgment has not been rendered. In Maine state courts there is a
strong policy favoring settlement and mediation. See MLR. Civ. P. 16B advisory
committee’s Statement. At the same time, there is also a strong policy in favor of
deciding cases on the merits, rather than dismissing on procedural grounds. See
Wescott v. Allstate Ins., 397 A.2d 156, 163 (Me. 1979). In this case, it appears that there
was delay. This delay, however, was caused in part by the parties attempting to settle
the matter out of court. Therefore, at this time, Port Harbor’s motion to dismiss will be
denied.
Irving moves that this court dismiss Count I and Count II because under the
doctrine of merger, the deed accepted becomes the final statement of the agreement
between the parties, and the purchase and sale agreement becomes a nullity. See Bryan
v. Breyer, 665 A.2d 1020, 1022 (Me. 1995). Therefore, Irving argues, no cause of action
remains under the purchase and sale agreement.
HHH counters and makes a cross-motion for summary judgment against Irving.
Irving has noted in its reply that it will respond to the motion for summary judgment.
HHH’s complaint contains allegations from both the purchase and sale agreement and
the time of taking the deed which it will need to prove factually to survive summary
judgment. The court will therefore deny the motion to dismiss at this time and rule
upon the motion for summary judgment once the parties have filed all of the
appropriate summary judgment materials. See MLR. Civ. P. 12(b).
Motion to Consolidate
* At hearing, HHH made reference to actionable deceit. This cause of action requires:
(1) A material representation which is (2) false and (3) known to be false, or made
recklessly as an assertion of fact without knowledge of its truth or falsity; (4)
made with the intention that it shall be acted upon and (5) acted upon with
damage; that (6) plaintiff relied upon the representations, (7) was induced to act
upon them and (8) did not know them to be false, and by the exercise of
reasonable care could not have ascertained their falsity.
Horner v. Flynn, 334 A.2d 194, 203 (Me. 1975) (quoting Coffin v. Dodge, 76 A.2d 541 (Me.
1950)) overruled in part by Taylor v. Commissioner of Mental Health, 481 A.2d 139, 152-54
(Me. 1984); see also Precon, Inc. v. JRS Realty Trust, 47 B.R. 432, 439 (D. Me. 1985). It is not
clear, however, that the elements of actionable deceit are plead in the plaintiff's complaint and
this issue should be resolved on summary judgment. At hearing, HHH stated that it would
address the issues of the easements in the purchase and sale agreement, and move to amend the
complaint if necessary.
Under M.R. Civ. P. 42(a), this court may consolidate actions dealing with the “a
common question of law or fact.” It is within this court’s discretion whether to allow a
motion for consolidation. See Maietta v. Int'l Harvester Co., 496 A.2d 286, 290-91 (Me.
1985).
In this case, Lawyers Title argues that the court should deny the motion to
consolidate because HHH’s claims are not ready for determination. Lawyers Title also
argues that HHH is trying to make an end run around its procedural mistakes by
consolidating the actions. HHH has made no reply to Lawyers Title’s opposition.
The motion to consolidate is granted. As noted above, much of the delay was
caused by the parties trying to resolve the matter. As to claims against Lawyers Title,
under the standard of Rule 42, and the claims pled against Lawyers Title in the
plaintiff's complaint, there appears to be no reason to deny the motion. Claims against
Lawyers Title were for breach of contract. A motion to dismiss or a motion for
summary judgment may eliminate these claims, but that is not before the court.
Motion for Sanctions
Irving argues that HHH should be subject to sanctions under MR. Civ. P. 11.
Irving argues that there is no good faith basis for HHH’s claims against it. See Baker's
Table, Inc. v. City of Portland, 2000 ME 7, 743 A.2d 237. Irving argues that this is
compounded by the fact that Irving’s counsel communicated with HHH’s counsel who
said that they would promptly respond to Irving about dismissing their claims.
HHH argues that there are legitimate issues regarding the transaction between
Irving and HHH, issues that should be resolved in the upcoming summary judgment
motion. HHH further incorporates an affidavit from counsel explaining its side of the
communications between counsel for Irving and counsel for HHH. HHH’s counsel .
argues that the communication with Irving was meant to be in the nature of a_
settlement agreement, and that there were ongoing negotiations which were apparently
not resolved.
The court will reserve ruling on the motion for sanctions, but notes that HHH
has been dilatory in responding to both defendants’ counsel and the court in this and
the Previous Action. The court notes that HHH was granted leave to file a motion to
amend in the Previous Action, and has not done so (presumably to deal with these
motions, but no explanation has been filed with the court). This matter of sanctions will
be resolved at a later date, but counsel for HHH is warned that this matter should be
dealt with promptly.
The entry is:
Defendants Port Harbor Marine, Inc., and Port Harbor Holdings I, motion to
dismiss is DENIED.
HHH, LLC’s Motion to Consolidate is GRANTED.
Irving Oil Corporation’s motion to dismiss Count I and Count I of HHH’s
amended complaint is DENIED.
Irving Oil Corporation’s motion for sanctions under MR. om will not be
will ti n at this time.
oland’A. Gole”
Justice, Superior Court
ruled on at this time.
HHH, LLC’s cross-motion for summary judge
Dated: August Y 2004
= COURTS
nd C+ inty
« OX 2E7
1e 04112-0287
|
DAVID SOLEY ESQ
PO BOX 9729
PORTLAND ME 04104
nd County Te -
le 04112-0287
JOHN HOBSON ESQ
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PORTLAND ME 04112
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PORTLAND ME 04112
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- COURTS
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JOSEPH SANCHEZ, ESQ
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MOUNT SINAI Ny 11766
IF COURTS
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Box 287
ine 04112-9287
ANDREW SPARKS ESO
ONE. MONUMENT WAY
. PORTLAND Mr 04101
STATE OF MAINE a . SUPERIOR COURT
. ++ CIVIL ACTION
CUMBERLAND, ss DOCKET NO. CV-04-214 ”
- 4 GR PD LG ‘ ba on ts
pe a TDS BRAC CUA | of, /o OO
H.H.H,, LLC, .
Plaintiff,
v. ORDER
Port Harbor Marine, Inc., Port Harbor
Holdings I, Herbert E. Tyler, Grace M. Tyler,
Lawyers Title Insurance Corp., and
Irving Oil Corporation, OO ms
PRPS a
Defendants
OCT 22 ogy
This case comes before the court on Plaintiff H.H.H., LLC’s Motion for
Summary Judgment on Counts I and II of its Complaint, pursuant to MR. Civ. P.
56. Counts I and II are raised against Defendant Irving Oil Corporation (Irving
Oil) only. Irving Oil opposes the motion and seeks summary judgment in its
favor on both counts Irving Oil also seeks sanctions against H.H.H., LLC, under
Rule 11 of Maine Rules of Civil Procedure.
FACTS
In May 1999, H.H.H., LLC (Plaintiff) as assignee, and Irving Oil entered
into a purchase and sale agreement for 20.76 acres of land in South Portland,
Maine. The sale was completed, and a quitclaim deed with covenants was
conveyed on August 31, 1999. On or about July 2003, a dispute arose between
Plaintiff and adjacent owners Port Harbor, concerning an alleged right of way
that Plaintiff was fencing off. A dispute arose as to the presence of easements in
favor of Port Harbor and others on Plaintiff's property.
In March 30, 2004, Plaintiff filed a Complaint alleging breach of contract
(Count I) and specific performance (Count Il) against Irving Oil, alleging Irving
Oil failed to deliver the property free of encumbrances as promised in the
purchase and sale agreement. Irving Oil filed a Motion to Dismiss Counts I and
I and moved that sanctions be imposed under MLR. Civ. P. 11. Plaintiff cross-
moved for summary judgment on Counts I and IL. Irving Oil opposed and
sought summary judgment in its favor on both counts. On order of the Superior
Court, Irving Oil’s Motion to Dismiss was denied August 4, 2004. Irving Oil’s
Motion for Sanctions under Rule 11 was not decided.
DISCUSSION
Summary judgment is warranted:
when the statement of material facts and the pleadings, depositions,
answers to interrogatories, admissions on file, and affidavits, if any, cited
in the statement of material facts establish that there is no genuine issue of
material fact and that a party is entitled to judgment as a matter of law.
Darline’s v. Ford Motor Co., 2003 ME 21, ¥ 4, 825 A.2d 344,345 (citing MLR. Civ.
P.56). A genuine issue of material fact exists when enough acceptable evidence
supports a factual dispute, requiring the fact finder to chose between two
competing versions of the truth at trial. Blanchet v. Assurance Co. of Am., 2001
ME 40, { 6, 766 A.2d 71, 73.
In this case, the parties dispute how the terms of their purchase and sale
agreement interact with terms in the deed delivered by Irving Oil and accepted
by the Plaintiff. Plaintiff, who is the moving party, asserts there is no issue of
"The Complaint also alleged causes of action for breach of contract against Lawyers Title
Insurance, breach of contract, quiet title and declaratory judgment against adjacent owners and
easement holders Herbert E. and Grace M. Tyler, and declaratory judgment and quiet title
against adjacent owner Port Harbor.
* A Motion to Dismiss by Port Harbor Marine and Port Harbor Holdings I was also denied. In the
same order, Plaintiffs dispute with Port Harbor was consolidated with this case.
material fact that terms in the purchase and sale agreement were breached when
Irving Oil conveyed title encumbered by easements, and that Irving Oil
misrepresented what was conveyed by deed when it did not include a
description of all easements in the deed and ona survey map. Irving Oil asserts
there is no issue of material fact that liability under the purchase and sale
agreement is barred under the doctrine of merger by deed, and that no
misrepresentation can be alleged when a description of all easements was
included in the purchase and sale agreement, along with procedures for
objecting to those easements.
L. The Purchase and Sale Agreement
The purchase and sale agreement (P&S) was a lengthy, detailed document
that included maps and attachments. Among the attachments, were Exhibit C,
creating a cross-easement agreement between Plaintiff and Irving Oil, and
Exhibit D, a list of thirty-four (34) separate rights and easements on the property,
granted to others, including easements in favor of the Tylers and Port Harbor.
(P&S at Ex. D 16(d)(e), 19, 30). A survey map was attached that did not depict
the 34 easements listed in Exhibit D.
The purchase and sale agreement states that the “premises are to be
conveyed by good and sufficient quitclaim deed with covenant running to Buyer
according to the legal description based upon the Survey, and said deed shall
convey a good clear record and marketable title thereto, free from
encumbrances, except .. . (iii) subject to the provisions of Paragraph 3(c) such
matters identified on Exhibit D . “ (P&S at p.1)(emphasis added). Paragraph
3(b) states that “[t]itle to the Prernises shall be deemed marketable and in
compliance with the provisions of this Agreement notwithstanding: (i) any
encumbrance, lien or other matter affecting the Premises that is set forth on
Exhibit D.” (P&S at p. 2)(emphasis added).
Paragraph 3(c) stipulates the manner and time within which the Buyer,
must object to any “encumbrances, liens or defects” affecting title to the
property. If the Buyer fails to object under the terms of 3(c), “Buyer shall be
conclusively deemed to have accepted the Premises subject to any and all such
encumbrances, liens and defects,” (P&S at p. 3) (emphasis added).
Il. The Deed
The deed tendered by Irving Oil and accepted by Plaintiff makes no
mention of the 34 rights and easements listed in Exhibit D of the purchase and
sale agreement. However, the deed conveys the premises specifically “subject
to” an easement from Irving Oil to Northern Utilities (Deed at p.5), and “subject
to” the cross-easement with Plaintiff (Deed at p. 6). In the purchase and sale
agreement, Irving Oil promised to convey by deed “according to the legal
description based upon the survey.” (P&S at 1). The survey purports to show
only “the exact boundaries of the Premises and the exact location of the Cross
Easements” between Plaintiff and Irving Oil. (P&S at 1).
ll. Merger by Deed
When a conflict arises between the terms of a contract for the sale of land
and the terms of a deed, the common law doctrine of merger by deed may apply.
The Law Court interprets the doctrine as providing that, “oncea... deed is
accepted it becomes the final statement of the agreement between the parties and
nullifies all provisions of the purchase-and-sale agreement.” Bryan v. Breyer, 665
A.2d 1020, 1022 (Me. 1995)(citation omitted). “Upon acceptance, the deed
regulates the rights and liabilities of the parties.” Kezer v. Mark Stimson Assocs.,
4
CUMSC-CV-97-243 (Me. Super. Ct, Cum. Cty. Oct. 1, 1998)(Cole, J.). (citing 77
Am. Jur.2d Vendor & Purchaser, § 286). The doctrine has several exceptions. Id. at
29. Collateral agreements ina purchase and sale contract do not merge into the
deed. Waterville Indus., Inc. v. Fin. Auth. of Me., 2000 ME 138, | 16, 758 A.2d
986, 990. An agreement is collateral if it is not “connected with the title,
possession, quantity, or emblements of the land.” Id. (internal citations omitted).
Thus, promises to convey title free of encumbrances, which are included in
agreements connected with title, are not collateral for purposes of the doctrine of
merger. Charles S. Purnell, Annotation, Deed as Superseding or Merging Provisions
of Antecedent Contract Imposing Obligations Upon the Vendor, 38 A.L.R.2d 1310,
1315-17 (1954).
Here Plaintiff maintains that the terms of the purchase and sale agreement
to convey good and marketable title, free from encumbrances, should not merge
with the deed and should be enforceable against Irving Oil. Plaintiff's argument
must fail, because, even should every term of the purchase and sale agreement be
found enforceable, the agreement on its face clearly states that marketable title is
deemed notwithstanding the 34 rights and easements listed in Exhibit D, and
that the property is free from encumbrances except those identified in Exhibit D.
The purchase and sale agreement further stipulates that failure to object to
encumbrances in the manner and time set forth in the agreement shall be deemed
an acceptance by Buyer of all encumbrances.
IV. Misrepresentation
Another exception to the doctrine of merger by deed is found when a
buyer accepts a deed while under the influence of “mistake, fraud, or
misrepresentation.” 77 Am. Jur.2d, Vendor and Purchaser § 293 (2004). The fact
that the conveyance is by way of a quitclaim deed “will not relieve vendor from
liability for fraudulent representations as to title. Id. (citing Atwood v. Chapman
68 Me. 38, 42 (1877) “For this exception to apply, however, the contract or deed
must be induced by fraudulent misrepresentations, in which case the
Tepresentation and the deed remain distinct and there isno merger.” Kezer v.
Mark Stimson Assocs., at 29 (citing Everett v. Gilliland, 141 P.2d 326, 332 (N.M.
1943)).
Here, the Plaintiff’s knowledge of the 34 rights and easements listed in the
purchase and sale agreement, the manner and time stipulated for objecting to
them, and the provision stating Plaintiff accepted all encumbrances in the
absence of objections, overcomes Plaintiff's suggestion that Plaintiff was
deceived into relying on Irving Oil’s survey map when accepting the deed. The
survey map, upon which Plaintiff says it relied, expressly purported to show
only the exact boundaries of the property and the cross-easement between
Plaintiff and Irving Oil. Although the survey map did not show the 34 rights
and easements listed in Exhibit D, descriptions of those easements in Exhibit D
and references to Exhibit D in provisions regarding title and encumbrances could
not have been clearer.
V. Rule 11 Sanctions
Maine Rule of Civil Procedure 11 states in part:
(a)... The signature of an attorney or party [on a pleading or motion]
constitutes a representation by the signer that the signer has read the
pleading or motion; that to the best of the signer’s knowledge, information
and belief there is good ground to support it; and that it is not interposed
for delay. . . If a pleading or motion is signed with intent to defeat the
purpose of this rule, the court, upon motion or upon its own initiative,
may impose on the person who signed it, upon a represented party, or
upon both, an appropriate sanction, which may include an order to pay
the other party or parties the amount of the reasonable expenses incurred
because of the filing of the pleading or motion, including a reasonable
attorney’s fee.
MLR. Civ. P. 11(a)(2003).
The Law Court upheld Rule 11 sanctions when a pro se party filed over a
dozen meritless motions in one four-month period in an effort to delay
proceedings, harass the defendant, and force recusal of the judge. Estate of Ruth
FE. Dineen, 1998 ME 268, { 11, 721 A.2d 185, 188. Similarly, the Law Court upheld
Rule 11 sanctions imposed on a party who filed twenty-three affirmative
defenses and eleven counter-claims, after the trial court concluded these were
“interposed for delay.” Fraser Emplovees Fed. Credit Union v. Labbe, 1998 ME
71, 1 9, 708 A.2d 1027, 1030.
Here Irving Oil asserts that Plaintiff brought Counts I and II of its
Complaint against Irving Oil with no good faith basis and Plaintiff “clearly
misrepresents” the terms of the purchase and sale agreement in its Amended
Complaint. In discussions between Irving Oil and the Plaintiff, the Plaintiff
represented it would document its claim against Irving Oil further or dismiss it
altogether, but did neither. Plaintiff’s attorney, in a deposition, states that, at the
time of discussions with Irving Oil, Plaintiff was awaiting key evidence
concerning the easements in question, and that their representations were
pursuant to a settlement. When key evidence was not forthcoming, Plaintiff's
attorney chose to proceed because “[n]either Irving’s deed or its own survey
identifies the existence of any of the alleged easements.” Although Plaintiff may
have misstated terms of the purchase and sale agreement in his Amended
Complaint and may not prevail in counts I and IL, Irving Oil offers no evidence
that Counts I and II were completely without merit or were included and
pursued to impose delay. Indeed, the doctrine of merger by deed which Plaintiff
_Sought to overcome, has been rarely applied in Maine, and has been expanded in
other jurisdictions to exclude a wider range of collateral agreements. See § 290,
77 Am. Jur 2d, Vendor and Purchaser (2004).
WHEREFORE this Court DENIES Plaintiff H.H.H., LLC’s Motion for
Summary Judgment on Counts | and II, and GRANTS Defendant Irving Oil’s
Motion for Summary Judgment on Counts I and II. This court DENIES
Defendant Irving Oil’s Motion for Rule 11 Sanctions.
Date (\it..6, 2004 Li
A
Koland Cole
Justice, uperior Court
> COURTS
nd County
OX 287
© 04112-0287
MELISSA HEWEY ESO
PO BOX 9781
PORTLAND ME 04112
2OURTS
County
287°
04112-0287
THOMAS LAPRADE ESQ
PO BOX 15215
PORTLAND ME 04112
JURTS
Ounty ,
37
112-0287
DAVID SOLEY ESO
PO BOX 9729
~OURTS
County '
287
0414 12-0287
JOHN HOBSON ESQ
PO BOX 426
PORTLAND ME 04112
and County
30x 287
ine 04112-0287
JOSEPH SANCHEZ ESQ
5507-10 NESCONSET Hwy
SUITE 250
MOUNT SINAI NY 1176
ANDREW SPARKS ESQ.
ONE MONUMENT WAY
PORTLAND ME 04101
STATE OF MAINE SUPERIOR COURT
CUMBERLAND, ss. tL
DOCKET NO. CV¥-04-214
HHH, LLC,
Plaintiff
Vv. ORDER
Port Harbor Marine, Port Harbor Holdings, _
Herbert E. Tyler and Grace M. Tyler, 9
Irving Oil Corporation, and pr ?
Lawyers Title Insurance Corporation,
Defendants
we
we
This case comes before the Court on Defendants Herbert E. Tyler and
Grace M. Tyler’s Motion for Summary Judgment and Irving Oil Corporation's
Motion for Summary Judgment.
Plaintiff HHH, LLC (Plaintiff) is engaged in litigation over easements
burdening a property of about twenty acres in South Portland that Plaintiff
purchased from Irving Oil Corporation. (Irving Oil). In July 2003, Plaintiff built a
fence blocking access by way of those easements to the properties Herbert E.
Tyler and Grace M: Tyler (the Tylers), among others. Plaintiff argues that it was
deceived by Irving Oil into purchasing property subject to those easements. On
October 6, 2004, this Court granted summary judgment to Irving Oil on
Plaintiff's claims for breach of contract and specific performance. Plaintiff's
amended claims against Irving Oil are for negligent misrepresentation (Count I-
A); and fraud (Count I-A);
Plaintiff also maintains that it extinguished easements in favor of the
Tylers. Plaintiff has brought an action to quiet title as to the Tylers (Count IV); a
declaratory judgment action against the Tylers (Count V); and a breach of
contract claim (Count VI). The Tylers have counterclaimed against the Plaintiff
>
CIVIL ACTION (3
a5
Aw
a
for declaratory judgment (Count J), breach of contract (Count JI), nuisance
(Count HD and slander of title (Count IV).
Both Irving Oil and the Tylers now move for summary judgment on
Plaintiff's claims.
STANDARD OF REVIEW
On a motion for summary judgment, the court views the evidence in the
light most favorable to the party against whom judgment is sought, to decide
“whether the parties’ statements of material facts and the referenced record
material reveal a genuine issue of material fact.” Rogers v. jackson, 2002 ME 140,
5, 804 A.2d 379, 380 (citations omitted). If the record reveals no genuine issue of
material fact, then a summary judgment is proper. Curtis v. Porter, 2001 ME 158
at { 6, 784 A.2d at 21. When the moving party is the defendant, the burden rests
on that party to show that the evidence fails to establish a prima facie case for
each element of the cause of action. Stewart ex rel. Stewart v. Aldrich, 2002 ME 16,
{ 8, 788 A.2d 603, 606.
DISCUSSION
a. Counts J-A and U-A. Irving Oil.
Plaintiff again seeks to bring claims against Irving Oil for the failure of its
survey map to show the Cross Street easement burdening I
This Court held earlier that Plaintiff could not assert a claim of “mistake, fraud or
misrepresentation” in the survey map to bar application of the doctrine of
merger by deed.
1. Negligent Misrepresentation.
Count I-A in the Complaint states a claim for negligence. However,
Plaintiff argues that, in its amended complaint, Plaintiff brings “a negligent
misre
with ¢
presentation claim against Irving for its statements made in connection
the purchase and sale of real estate in South Portland.”
A cause of action in negligent misrepresentation may be brought when the
defenidant:
Chapr
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See, é.
infory
1990)
A.2d
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371, 3
the dé
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the Ci
agree
“acco
in the course of his business, profession or employment, or in any other
transaction in which he has a pecuniary interest, supplies false
information for the guidance of others in their business transactions, is
subject to liability for pecuniary loss caused to them by their justifiable
reliance upon information, if he fails to exercise reasonable care or
competence in obtaining or communicating the information.
han v. Rideout, 568 A.2d 829, 830 (Me. 1990)(citing RESTATEMENT (SECOND)
RTS § 552). To overcome a motion for summary judgment, Plaintiff must
de evidence in the record showing Irving Oil supplied false information.
lg. Devine v. Roche Biomedical Laboratories, 637 A.2d 441,445 (Me. 1994)}(false
mation on positive lab results); Chapman v. Rideout, 568 A.2d 829, 830 (Me.
false information on property boundaries); Binette v. Dyer Library Ass’n, 668
898, 903 (Me. 1996)(silence rising to the level of false information on the
nce of an environmental hazard on property); Letellier v. 5 mall, 400 A.2d
76 (Me. 1979)(false statement regarding results of a soil test). Silence, where
pfendant had a statutory duty to disclose, can amount to supplying false
mation for negligent misrepresentation purposes. Binette, 668 A.2d at 903.
Here, Plaintiff claims that Irving Oil did not disclose the existence of the
Street easement benefiting other Defendants on a boundary map Irving Oil
ded to show “the exact boundaries of the Premises and the exact location of
ross Easements” between Plaintiff and Irving Oil. In the purchase and sale
ment, Plaintiff argues, Irving Oil promised to convey the property by deed
tdine to the legal description based upon the survey.” Plaintiff also argues
8 & Pp Pp y 8
that Irving Oil’s surveyor had a duty under 1995 licensing standards to include
the location of the Cross Street easement on any boundary survey map. Plaintiff
maintains that it reasonably relied on the absence of the Cross Street easement on
the survey map when it proceeded purchased the property, to Plaintiff's
detriment.
Nothing in the record on summary judgment suggests that the map, titled
“Standard Boundary Survey” and purporting to show “the exact boundaries of
the Premises and the exact location of the Cross Easements” between Irving Oil
and Plaintiff did so incorrectly. However, the survey map’s “silence” as to the
Cross Street easement could be construed as rising to the level of negligently
supplying false information if Irving Oil breached a statutory obligation to show
the Cross Street easement on the boundary map or otherwise failed to provide
information to Plaintiff that a Cross Street easement existed.
In 1995, land surveyors had a regulatory duty to conform with Standards
of Practice established by the Maine State Board of Registration for Land
Surveyors.! The standard for field procedures required that “[a]ll easements of
record or apparent easements that are visible without careful searching shall be
physically located during the survey.” § 12.10.8.8. Any maps based on the
survey must show, “when applicable ... rights-of-way and easements
surrounding, adjoining, penetrating or severing the surveyed site.” § 12.10.9.12.
Thus Irving Oil’s surveyor appears to be required, by licensing regulations in
effect in 1995, to discover and show the Cross Street easement, an easement
1 These Standards, in effect from 1983 to 2001, provided the regulatory requirements for a
Standard Boundary Survey at § 12.10. Any maps must show, “when applicable .. . rights-of-way
and easements surrounding, adjoining, penetrating or severing the surveyed site.” § 12.10.9,12.
The enabling statute for the Board’s regulation is found af 32 M-RS.A. § 13903(2)(2004).
4
running along a boundary, on any map purporting to be a Standard Boundary
Survey. However, these regulatory and licensing standards govern the
surveyor's statutory obligations, and not Irving Oil's.
Irving Oil did, however, have a duty to make accurate, nonmisleading
representations concerning the easements burdening the property Irving Oil was
conveying by quitclaim deed. Nothing in the record suggests Irving Oil failed to
do so, although those disclosures were not made on the survey map, but were
instead listed in detail in the purchase and sale agreement. Nothing in the record
suggests Irving Oil maintained the survey map showed all easements. In fact,
Plaintiff was expressly cautioned that the “legal description based upon the
survey” was subject to the listed easements. Thus the “silence” of the survey map
as to the Cross Street easement cannot rise to the level of misrepresentation
where that information was openly disclosed to the Plaintiff elsewhere, and
where Irving Oil expressly informed the Plaintiff that the survey was subject to
the disclosed easements.
Summary judgment also requires that Plaintiff provide evidence in the
record showing Plaintiff's justifiably relied on the survey map to show whether
the Cross Street easement burdened the property, while ignoring that
information in its own purchase and sale contract. Reliance is not justified “if the
plaintiff knows the representation is false or its falsity is obvious to him.”
Letellier v. Small, 400 A.2d 371, 376 (Me. 1979). Here the undisputed record shows
Plaintiff’s reliance was unjustified where the purchase and sale agreement
entered by Plaintiff referred to the survey for a legal description of the property,
and then expressly cautioned that the property in the survey was “free from
encumbrances except .. . subject to the provisions of Paragraph 3(c), (discussed
below), such matters identified on Exhibit D.” Exhibit D listed as many as 34
such easements, including the Cross Street easement.
The purchase and sale agreement also expressly directed Plaintiff to
conduct its own title search and to object to the Cross Street encumbrances
within sixty days. Plaintiff expressly agreed that failure to object within the sixty-
day period constituted a waiver of objection. Nothing in the record shows
Plaintiff consulted or even saw the survey map before deciding not to object to
the Cross Street encumbrance. While Plaintiff had no affirmative duty to
investigate the accuracy of the survey map’s location of boundaries or cross-
easements with Irving Oil, the purpose for which it was offered, Plaintiff cannot
claim ignorance of information concerning a Cross Street easement not shown on
that map, but openly disclosed in a contract to which Plaintiff was a party.
The record on summary judgment also shows that Plaintiff properly relied
not on Irving Oil, but on Plaintiff’s attorney, for information on the number of
easements burdening the property and the nature of those easements, and for
Plaintiff's belief that easements had been or could be terminated.’
Thus, the undisputed record contains no evidence showing that Irving Oil
was silent on the matter of the Cross Street easement, or that Plaintiff justifiably
relied on a survey map claiming only to show boundaries and cross-easements
with Irving Oil to conclude that the Cross Street easement did not exist or had
somehow been extinguished. Because both misrepresentation and justifiable
> The Law Court noted “[t]he essence of the attorney-client relationship in title cases is the faith
and trust which the client places in the representations of the attorney regarding the status of title
to the property he is about to purchase. The security of knowing that the title is good and the
property is free of encumbrances is what the client purchases when he retains an attorney to
search title for him.” Johanson v. Dunnington, 2001 ME 169, 7 9n.3, 785 A.2d 1244, 1247 (citing
Anderson v. Neal, 428 A.2d 1189, 1192 (Me. 1981)).
reliance are essential elements of Plaintiff's cause of action, summary judgment is
porperly granted to Irving Oil on Count I-A.
2. Fraud
To maintain a claim of fraud, Plaintiff must establish that the defendant:
(1) makes a false representation (2) of a material fact (3) with knowledge of its
falsity or in reckless disregard of whether it is true or false (4) for the purpose of
inducing another to act or to refrain from acting in reliance upon it, and (5) the
plaintiff justifiably relies upon the representation as true and acts upon it to his
damage. St. Francis De Sales Fed. Credit Union v. Sun Ins. Co. of N.Y., 2002 ME 127,
J 26, 818 A.2d 995, 1003. A plaintiff is entitled to “justifiably rely” on a
misrepresentation without investigating its truth or falsity, unless the plaintiff
knows it to be false or its falsity is obvious. Id. J 29.
Here Plaintiff has not met its burden of providing evidence of the first
element, that a false representation was made by Irving regarding the existence
of a Cross Street easement that was fully disclosed by Irving Oil in the purchase
and sale agreement. Nor has Plaintiff provided evidence of the fourth element,
that the survey map was intended to induce Plaintiff into buying the property
and ignoring or discounting Irving Oil’s express referral to and disclosure of a
Cross Street easement. Plaintiff's justifiable reliance on the survey map, the fifth
element of fraud, has been addressed.
Irving Oil openly disclosed the Cross Street easement in the purchase and
sale agreement. The survey map purported only to show Plaintiff the legal
boundaries of Plaintiff's property and any cross-easements between Plaintiff and
Irving Oil. The “legal description based upon the survey” was expressly
conditioned by a list of encumbrances that included Cross Street. Plaintiff was
encouraged to do a title search, which would have likewise shown the same
Cross Street easement expressly disclosed by Irving Oil, and Plaintiff was invited
to raise objections about the Cross Street easement prior to closing. Furthermore, .
Plaintiff provides no evidence that it saw or referred to the survey map at any
time before closing. Because Plaintiff has not met his burden of showing that
Irving Oil knowingly made a false representation, intended to induce Plaintiff's
reliance, or that Plaintiff justifiably relied on a false representation, judgment is
granted to Irving Oil on Plaintiff's Count II-A.
b. Counts IV-VI. The Tylers.
1. The Picket Street Extension
Here Plaintiff and Tylers dispute an easement over a portion of Plaintiff’s
property called the Pickett Street Extension adjacent to property the Tylers
acquired in 1995 by quitclaim deed from Breakwater Condominium Associates.
In that deed, the Tylers were favored with an easement and right of way over
Cross Street and over the Pickett Street Extension that ran along the Tylers’ west
and southwest perimeter. However, Breakwater reserved the right to terminate
the easement over Cross Street and over “that portion of the Pickett Street
Extension which is located northwesterly of the furthest point northwest along
the common sideline of the Premises and Pickett Street Extension.” This
reservation of the right to terminate part of the easement passed to the Plaintiff,
who did in fact exercise it in March 2003.
Plaintiff argues this effectively terminates any easement running along the
Tylers’ boundary with the Pickett Street Extension. Plaintiff has gone to a great
deal of trouble to show that the Tylers property consists of three separate
conveyances in 1984, 1993 and 1995, and to trace chains of title for all three. At
issue here, however, is only the easement to the last of these, the 1995 piece that
runs along the Cross Street and Picket Street Extension easements. Plaintiff
mysteriously argues the reservation to Plaintiff stated in the 1995 deed allows _
Plaintiff to terminate the easement “over Pickett Street extension to the north and
west of the south eastern corner of the Tyler property,” when the language of the
deed says something quite different. The language of the deed, and Plaintitt’s
March 2003 termination effectively terminates any easement the Tylers 1995
parcel may have enjoyed along Cross Street and any easement along the part of
the Pickett Street Extension that extends northwest of the northwestern-most
point where the Tylers’ property line and the Pickett Street Extension adjoin.
That northwestern-most point is where Cross Street meets the Pickett Street
Extension.
Plaintiff also argues that the Tylers may not use the easement granted in
the 1995 deed to access their adjoining parcels acquired in 1993 and 1984.
Plaintiff argues that the Tylers’ 1993 and 1984 parcels, or perhaps the Tylers
themselves are “strangers” to the 1995 easement along the Pickett Street
Extension and may not benefit from it. However, the Tylers do not argue that
their acquisition of the 1984, 1993 and 1995 properties are part of a unitary
transaction. Nor is that argument relevant to a determination of what easement
they retain benefiting their 1995 property, the only question before this Court on
summary judgment.
The Tylers are arguing that the plain language of their 1995 deed entitles
them to a specific and non-terminable easement along the Pickett Street
Extension adjoining their property up to the intersection of Cross Street and the
Pickett Street extension, the “furthest point northwest along the common sideline
of the Premises and Pickett Street Extension.” Because the record on summary
judgment, including the plain language of the deeds, creates no issue of fact as to
" whether an interminable easement was conveyed to the Tylers in 1995 that
extends along the Pickett Street Extension to the intersection with Cross Street,
Tylers are entitled to judgment as a matter of law in their favor on Plaintiffs
Counts IV and V disputing that easement.
2. The December 2000 Agreement.
In December 2000, Plaintiff and the Tylers entered an agreement that
stipulated:
1. Both parties would execute irrevocable license agreements for egress
and ingress to and from Ace Ventures Group property.
2. If either Plaintiff or the Tylers acquired the Ace Ventures Group
property that party would terminate the license agreements with Ace
Ventures Group. Either party could terminate is own license agreement.
3. If Plaintiff purchased the Ace Ventures Group property, the Tylers
would be given a release deed from Plaintiff for al claims to their 1995
property.
The Tylers and Plaintiff then executed the agreed-upon license to Ace Ventures
Group on the same day. In the license agreements, the Tylers redefine the
entrance and egress terms between themselves and Plaintiff. However, Ace
Ventures Group never signed the license agreement. Furthermore, neither the
Tylers nor the Plaintiff acquired the property from Ace Ventures Group, as
anticipated. Instead, at the time the parties entered their agreement, Ace
Ventures Group had already conveyed the property that was the subject of
Plaintiff and the Tylers’ agreement to Defendants Port Harbor Marine and Port
Harbor Holdings. Nonetheless, Plaintiff now claims the Tylers have breached the
agreement by not complying with the terms of the license agreement.
TA
The Law Court has held that a “contract exists if the parties mutually
assent to be bound by all its material terms, the assent is either expressly or
impliedly manifested in the contract, and the contract is sufficiently definite to
enable the court to ascertain its exact meaning and fix exactly the legal liability of
each party.” Sullivan v. Porter, 2004 ME 134, { 13, 861 A.2d 625, 631. Thus, the
Law Court found a contract existed when an agreement was assented to by both
sides and “embodied the essential material terms . . . including the identification
of the property, the parties to the sale, the purchase price, the amount of the
down payment and the type of financing. Id. Here any license agreement
between the Tylers and Ace Ventures Group is unenforceable for lack of a
signature or any unconditional manifestation of assent to it from Ace Ventures
Group, the other party to its terms.
Furthermore, any agreement between Plaintiff and the Tylers relates toa
subject matter, namely, property owned by Ace Ventures Group or conveyed to
Plaintiff or the Tylers, that does not exist and did not exist at the time the parties
entered the agreement. Thus any agreement entered by the parties concerning
that subject matter rested upon a mutual mistake.
Under Maine law, “parties may be relieved from the obligations imposed
by contract upon the ground of mutual mistake of fact that concerns a material
element of the contract.” Bouchard v. Blunt, 579 A.2d 261, 263 (Me. 1990). Such
contracts are unenforceable because the parties’ mutual mistake “precludes any
meeting of the minds on all the material elements of the contract.” Id. (citing
Ouillette v. Boldac, 440 A.2d 1042, 1045-46 (Me. 1982)}. However, the mistake
“must relate to the circumstances as they existed at the time the contract was
formed and not subsequent developments.” Id. (quotation omitted).
11
Here the parties entered an agreement on December 28, 2000 on the
mutually mistaken belief that the property in fact conveyed to Port Harbor
earlier in the month, continued to be held by Ace Ventures Group. This fact was
material to their agreement creating mutual obligations between themselves and
Ace Ventures Group relating to egress and ingress to Ace Ventures Group’s
property and the parties’ property. Plaintiff and the Tylers’ mistake related to
the state of ownership as it existed on December 28, 2000, at the time their
agreement was signed, and not to events arising afterward. Because the parties’
confidential contract was based on mutual mistake, their contract was and
remains unenforceable, as do the licensing agreements stemming from that
contract. Bouchard v. Blunt, 579 A.2d 261, 263 (Me. 1990). The Tyler’s Motion for
Summary Judgment on Count VI of Plaintiffs complaint is therefore granted.
This Court hereby GRANTS Defendant Irving Oil’s Motion for Summary
Judgment on Counts I-A and H-A of Plaintiff HHH’s Amended Complaint.
This Court GRANTS Defendant Herbert E. Tyler and Grace M. Tyler’s
Motion for Summary Judgment on Counts IV, V, and VI of Plaintiff HHH’s
Amended Complaint. Y
if
Date e
Justig, Superior Court
12
OF COURTS
rland County
. Box 287
aine 04112-0287
UF LUURIS
rland County
, Box 287
laine 04112-0287
Maine 04112-0287
ANDREW SPARKS ESQ
ONE MONUMENT WAY
PORTLAND ME 04101
DAVID SOLEY ESQ
PO BOX 9729
PORTLAND ME 04104
THOMAS LAPRADE ESQ
PO BOX 15215
PORTLAND ME 04112
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JOHN HOBSON ESO “A i V
PO BOX 426 7
PORTLAND ME 04112
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10x 287
qe 04112-0287
FRANK CHOWDRY ESO .
PO BOX 4510 4
PORTLAND ME 04112