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Drilling & Blasting Rock Specialists, Inc. v. Rheaume

Supreme Court of Maine

August 16, 2016

DRILLING & BLASTING ROCK SPECIALISTS, INC.
v.
PAUL RHEAUME

          Argued: February 10, 2016

         On the briefs:

          David M. Lipman, Esq., and Peter B. Bickerman, Esq., Lipman, Katz & McKee, P.A., Augusta, for appellant Drilling and Blasting Rock Specialists, Inc.

          James A. Billings, Esq., and Matthew D. Morgan, Esq., McKee Billings, P.A., Augusta, for appellee Paul Rheaume

         At oral argument:

          Peter B. Bickerman, Esq., for appellant Drilling and Blasting Rock Specialists, Inc.

          Matthew D. Morgan, Esq., for appellee Paul Rheaume

          Panel: SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, HJELM, and HUMPHREY, JJ.

          JABAR, J.

         [¶1] Drilling & Blasting Rock Specialists, Inc., (DBRS) appeals from a summary judgment entered in favor of Paul Rheaume in the Superior Court (Kennebec County, Mullen, J.) on Rheaumes statute of limitations defense to DBRSs complaint for intentional and negligent misrepresentation. Viewing the summary judgment record in the light most favorable to DBRS, we conclude that the record reflects a factual dispute regarding the commencement of the limitations period applicable to the intentional misrepresentation claim. We therefore vacate the summary judgment in part and remand for adjudication of this factual issue. With respect to the negligent misrepresentation claim, we discern no dispute of material fact and conclude that the trial court correctly entered summary judgment in Rheaumes favor. We accordingly affirm the judgment in part.

         I. FACTUAL BACKGROUND

         [¶2] The following facts are established by the parties statements of material fact and the evidence referred to therein, are viewed in the light most favorable to the nonprevailing party, and are undisputed unless otherwise noted. See Remmes v. Mark Travel Corp., 2015 ME 63, ¶ 3, 116 A.3d 466.

         [¶3] Rheaume owned T.W. Dick Company, Inc., (TWD) from 1995 to 2009. On March 9, 2006, Rheaume, acting as president of TWD, executed and delivered a promissory note and mortgage to Robert McKee in consideration for McKee conveying to TWD a parcel of real property located on Brunswick Avenue in Gardiner. McKees mortgage on the Brunswick Avenue property was recorded in the Kennebec County Registry of Deeds the following day.

         [¶4] In May 2006, two months after TWD acquired the Brunswick Avenue property, Rheaume contacted DBRSs president, Timothy Purington, to ask whether DBRS might be interested in purchasing the Brunswick Avenue property from TWD. In August 2006, TWD conveyed the Brunswick Avenue property to DBRS by a warranty deed that did not mention the outstanding mortgage to McKee and represented that the property was free of all encumbrances. At the same time, Timothy Purington, acting as president of DBRS, executed and delivered a promissory note and mortgage to TWD in consideration for the conveyance by TWD.

         [¶5] Rheaume did not tell anyone associated with DBRS that McKee held a first mortgage on the property or that TWD was obligated to make payments on the note held by McKee for a period of fifteen years. TWD was represented by counsel in the transaction and paid for a title search of the Brunswick Avenue property prior to the closing, but did not disclose the results of any title search to DBRS.

         [¶6] At the closing, DBRS was not represented by counsel, and Timothy Purington, as president of DBRS, signed a "Notice of Representation, " agreeing that if DBRS had "any legal questions" regarding the sale of the property it "should discuss them with independent counsel." DBRS relied upon the representations contained in the warranty deed with respect to the absence of encumbrances on the Brunswick Avenue property. It would not have gone through with the transaction if it had known that McKee held a first mortgage on the property.

         [¶7] According to Rheaume, DBRS contacted him about one week after the sale and requested a "bill of sale" from McKee. DBRS denies this statement, and asserts that it did not learn of the McKee mortgage until 2013.

         [¶8] At some point after DBRS acquired the Brunswick Avenue property, TWD defaulted on the promissory note and mortgage held by McKee and McKee sought to foreclose on the property now owned by DBRS. DBRS asserts that it has been frustrated in its plan to use the Brunswick Avenue property for ...


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