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Riston v. Klausmair

United States District Court, D. Maryland

September 11, 2018

JOHN RISTON and AMY HARTMAN, Plaintiffs,
v.
KURT KLAUSMAIR, Defendant.

          MEMORANDUM OPINION

          RICHARD D. BENNETT, UNITED STATES DISTRICT JUDGE

         This cases arises out of a roof construction project at Gladden Farm in Harford County, Maryland. On December 20, 2017, Plaintiffs, Mr. John Riston (“Mr. Riston”) and Dr. Amy Hartman (“Dr. Hartman”), the property owners, filed suit against the Defendant, Kurt Klausmair (“Mr. Klausmair”), alleging that Mr. Klausmair, a Pennsylvania resident, breached various duties related to his roof construction efforts on the property. (ECF No. 1.) Count I alleges that Mr. Klausmair breached the roof construction contract by making various misrepresentations and performing sub-standard work. (Id. at ¶¶ 17-21.) Count II alleges that Mr. Klausmair breached a settlement agreement purportedly reached when the contract was terminated. (Id. at ¶¶ 22-25.) Count III alleges that Mr. Klausmair breached a warranty of workmanlike performance. (Id. at ¶¶ 26-29.) Finally, Count IV alleges that Mr. Klausmair violated the Maryland Deceptive Trade Practices Act, Md. Ann. Code, Commercial Law § 13-301, et seq., by making various alleged misrepresentations before and during performance of the roofing work. (Id. at ¶¶ 30-35.)

         Pending now are Mr. Klausmair's Motion to Dismiss (ECF No. 20), the Plaintiffs' Motion to Amend Complaint (ECF No. 23), and the Plaintiffs' Motion for Partial Summary Judgment on Count II (ECF No. 30). The submissions have been reviewed, and no hearing is necessary. See Local Rule 105.6 (D. Md. 2016). For the reasons set forth below, Plaintiffs' Motion to Amend Complaint (ECF No. 23) is GRANTED. Mr. Klausmair's Motion to Dismiss (ECF No. 20), as applied to the three counts and two defendants contained in the Amended Complaint, is MOOT IN PART, GRANTED IN PART, and DENIED IN PART. Specifically, the Amended Complaint removes the warranty claim (Count III of the original Complaint) and adds Klausmair Construction, LLC - thereby rendering moot Mr. Klausmair's challenges on those grounds. Mr. Klausmair's Motion to Dismiss is granted with respect to the contract claims (Counts I and II) due to Plaintiffs' lack of standing, and Counts I and II are DISMISSED WITHOUT PREJUDICE. The Motion to Dismiss is denied as to the Maryland Deceptive Trade Practices Act count (Count III of the Amended Complaint). Count III of the Amended Complaint will therefore proceed against Mr. Klausmair and Klausmair Construction, LLC. Additionally, Mr. Klausmair's request to transfer venue (see ECF No. 20 at 13-21) is DENIED as the related Pennsylvania lawsuit filed by Klausmair Construction LLC has been dismissed for lack of personal jurisdiction. Finally, the Plaintiffs' Motion for Partial Summary Judgment on Count II (ECF No. 30) is DENIED.

         BACKGROUND[1]

         Plaintiffs, Mr. Riston and Dr. Hartman, are the owners of the property at 3881 Rocks Station Road in Harford County, Maryland known as the Gladden Farm, which is a historic home and farm complex located in Street, Harford County, Maryland. (ECF No. 1 at ¶ 2.) Gladden Farm contains three historically significant structures dating to 1820 and is listed in the National Register of Historic Places in 1993. (Id.) The Defendant, Mr. Klausmair, is a resident of Pennsylvania who holds himself out as a roofing and home improvement contractor, but he has not been licensed by the State of Maryland as a home improvement contractor or salesman. (Id. ¶¶ 3, 8.)

         Based on prior work by Mr. Klausmair, the Plaintiffs discussed with Mr. Klausmair whether he could help them to renovate a building that would serve as the Plaintiffs' home. (Id. ¶ 6.) Klausmair assured them that he was qualified to perform the work competently, and he provided them a quote. (Id.) Mr. Klausmair sent a contract to Plaintiffs in Maryland for consideration and execution. (Id.; Contract, Ex. A, ECF No. 1-1.) The Plaintiffs allege that, at the time of entering into the contract, they were unaware that Mr. Klausmair lacked a license and that the contract itself did not comply with Maryland law because it omitted various required notices, including a Maryland Home Improvement Commission (“MHIC”) license number for Defendant. (ECF No. 1 at ¶¶ 9, 32.) Upon execution of the contract, Plaintiffs provided Mr. Klausmair with a $100, 000 deposit. (Id. ¶ 10.)

         Within weeks of the start to the roofing work, other contractors started complaining to Plaintiffs about issues with the roofing work. (Id. ¶ 12.) Mr. Klausmair eventually agreed to visit the property to inspect the work. (Id. ¶ 13.) Upon Mr. Klausmair's visit, the Plaintiffs confronted Klausmair about his lack of a Maryland license and the work performance, and they demanded a refund of the deposit. Plaintiffs allege that Mr. Klausmair “agreed with Plaintiffs to terminate and settle their disagreement by having Plaintiffs return to him the copper flashing stored on the jobsite in exchange for his returning to Plaintiffs the $100, 000 deposit they provided.” (Id. ¶ 23.) Plaintiffs then provided the flashing, which Klausmair placed in his truck. (Id. ¶ 14.) Mr. Klausmair gave Plaintiffs the $100, 000 check and left. (Id; Copy of Check, Ex. B, ECF No. 1-2 at 2.)

         However, when Plaintiffs attempted to deposit the check, it was dishonored as Mr. Klausmair had apparently “stop[ped] payment” on the check. (Id. ¶ 15; Ex. B, ECF No. 1-2.) In order to mend the defective roof, Plaintiffs arranged to have other workers repair the problems. (Id. ¶ 16.) Plaintiffs also hired a new roofer who, along with Plaintiffs' architect, “confirmed the shortcomings of Klausmair's installation and workmanship.” (Id.)

         On December 20, 2017, Plaintiffs filed suit against the Mr. Klausmair alleging that he breached various duties related to his roof construction efforts on the property. (ECF No. 1.) Count I alleges that Mr. Klausmair breached the roof installation contract by making various misrepresentations and performing sub-standard work. (Id. at ¶¶ 17-21.) Count II alleges that Mr. Klausmair breached a settlement agreement purportedly reached when the contract was terminated. (Id. at ¶¶ 22-25.) Count III alleges that Mr. Klausmair breached a warranty of workmanlike performance. (Id. at ¶¶ 26-29.) Finally, Count IV alleges that Mr. Klausmair violated the Maryland Deceptive Trade Practices Act, Md. Ann. Code, Commercial Law § 13-301, et seq., by making various alleged misrepresentations before and during performance of the roofing work. (Id. at ¶¶ 30-35.) Pending now are Defendant Klausmair's Motion to Dismiss (ECF No. 20), the Plaintiffs' Motion to Amend Complaint (ECF No. 23), and the Plaintiffs' Motion for Partial Summary Judgment on Count II (ECF No. 30).

         STANDARDS OF REVIEW

         I. Amendments under Rule 15

         Under Rule 15(a), a party may amend a pleading once as a matter of course within “21 days after service of a responsive pleading, ” if such a response is required. Fed.R.Civ.P. 15(a)(1). After this initial window has passed, “a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires.” Fed.R.Civ.P. 15(a)(2). While leave to file an amended complaint should be freely given when justice requires, it may be denied where the amendment would be futile. Equal Rights Ctr. v. Niles Bolton Associates, 602 F.3d 597, 603 (4th Cir. 2010). An amendment is futile when it is insufficient on its face. Johnson v. Oroweat Foods Co., 785 F.2d 503, 510 (4th Cir. 1986). A district court properly denies leave to amend a pleading when a proposed amendment fails to “correct[] the fundamental defect in the complaint.” New Beckley Mining Corp. v. Int'l Union, United Mine Workers, 18 F.3d 1161, 1164 (4th Cir. 1994).

         II. Motion to Dismiss under Rule 12(b)(1)

         A motion to dismiss under Rule 12(b)(1) of the Federal Rules of Civil Procedure for lack of subject-matter jurisdiction challenges a court's authority to hear the matter brought by a complaint. See Davis v. Thompson, 367 F.Supp.2d 792, 799 (D. Md. 2005). This jurisdictional attack may proceed either as a facial challenge, asserting that the allegations in the complaint are insufficient to establish subject-matter jurisdiction, or a factual challenge, asserting “that the jurisdictional allegations of the complaint [are] not true.” Kerns v. United States, 585 F.3d 187, 192 (4th Cir. 2009) (citation omitted).[2] In a facial challenge, a court will grant a motion to dismiss for lack of subject-matter jurisdiction “where a claim fails to allege facts upon which the court may base jurisdiction.” Davis, 367 F.Supp.2d at 799. In making this determination, “all the facts alleged in the complaint are assumed to be true and the plaintiff, in effect, is afforded the same procedural protection as he would receive under a Rule 12(b)(6) consideration.Adams v. Bain, 697 F.2d 1213, 1219 (4th Cir. 1982).[3]

         III. Motion to Dismiss under Rule 12(b)(6)

         Rule 12(b)(6) of the Federal Rules of Civil Procedure authorizes the dismissal of a complaint if it fails to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). To survive a motion under Fed.R.Civ.P. 12(b)(6), a complaint must contain facts sufficient to “state a claim to relief that is plausible on its face.” Bell Atl., Corp. v. Twombly, 550 U.S. 544, 570 (2007); Ashcroft v. Iqbal, 556 U.S. 662, 684 (2009). In reviewing a Rule 12(b)(6) motion to dismiss, the court must “accept as true all of the well-pleaded allegations and view the complaint in the light most favorable to [Plaintiff].” Quintana v. City of Alexandria, et al., 692 Fed.Appx. 122, 125 (4th Cir. 2017) (citing LeSeur-Richmond Slate Corp. v. Fehrer, 666 F.3d 261, 264 (4th Cir. 2012)); Semenova v. Maryland Transit Admin., 845 F.3d 564, 567 (4th Cir. 2017).

         Without converting a motion to dismiss to one for summary judgment, a court may consider documents that are “explicitly incorporated into the complaint by reference and those attached to the complaint as exhibits . . . .” Goines v. Valley Cmty. Servs. Bd., 822 F.3d 159, 166 (4th Cir. 2016) (internal citations omitted). “When the plaintiff attaches or incorporates a document upon which his claim is based, or when the complaint otherwise shows that the plaintiff has adopted the contents of the document, crediting the document over conflicting allegations in the complaint is proper.” Id. at 167.

         IV. Motion for Summary Judgment under Rule 56

         Rule 56 of the Federal Rules of Civil Procedure provides that a court “shall grant summary judgment if [a] movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). A material fact is one that “might affect the outcome of the suit under the governing law.” Libertarian Party of Va. v. Judd, 718 F.3d 308, 313 (4th Cir. 2013) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). A genuine issue over a material fact exists if “the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.” Anderson, 477 U.S. at 251-52; see also Drewitt v. Pratt, 999 F.2d 774, 778-79 (4th Cir. 1993) (explaining that a court must abide by its affirmative obligation to prevent factually unsupported claims and defenses from going to trial).

         DISCUSSION

         Before this Court decides whether to dismiss any claims or parties from this action, this Court will first address Plaintiff's Motion to Amend Complaint (ECF No. 23) in order to establish which counts and parties should even be under consideration.

         I. Motion to Amend Complaint

         Plaintiffs filed their Motion to Amend Complaint (ECF No. 23) on May 11, 2018, which was 14 days after Mr. Klausmair filed a Motion to Dismiss (ECF No. 20). In an attempt to resolve two arguments in the Defendant's Motion to Dismiss, the proposed Amended Complaint removes the breach of warranty claim (Count III in the original Complaint) and adds Klausmair Construction, LLC ...


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