Opinion
06C-05-268-JOH.
Submitted: August 17, 2007.
Decided: November 27, 2007.
Upon Motion of Defendants for Summary Judgment — DENIED.
Upon M otion of Plaintiffs to Consolidate — GRANTED for Pretrial Purposes
Thomas C. Marconi, Esquire, of Losco Marconi, Wilmington, Delaware attorney for plaintiffs.
Kate G. Shumaker, Esquire, of Elzufon Austin Reardon Tarlov Mondell, Wilmington, Delaware, attorney for defendants.
MEMORANDUM OPINION
Wayne and Lois Bartron have filed suit against Jim Pettit and RE/MAX of Wilmington ("ROW"). They had formerly worked at RE/MAX Realty, Ltd. ("Realty") which apparently merged with ROW. While at Realty, a series of transactions occurred in which Wayne Bartron was involved which led to disciplinary sanctions from the Real Estate Commission and a law suit.
After being sued, the Bartrons brought a cross-claim against Pettit and ROW alleging misrepresentations regarding insurance coverage. That case was Eller v. Bartron. Pettit and ROW moved for summary judgment. The Bartrons did not oppose the motion asking that it be granted without prejudice and to allow them to file a separate action. The motion was granted. The order which was signed did not specify "with prejudice" or "without prejudice."
Civil Action No. 02C-03-221-JOH.
Eller v. Bartron, Brady, J., May 3, 2006.
That award of summary judgment prompted the Bartrons to file this action which they did several weeks later. They have now moved to consolidate this "new" action with the case in which they had originally brought suit against Pettit and ROW. The defendants oppose it arguing, basically, that discretion should be exercised to deny consolidation.
The Court finds sufficient interrelated issues which, in its discretion, justify consolidation, at least for discovery purposes and coordinated scheduling of the two cases, if not ultimately for trial.
Factual Background
The more detailed factual background of this matter is set out in this Court's opinion of the same date in Eller v. Bartron. But some of that background is needed to understand this case and the Court's reasoning for granting consolidation.Wayne Bartron signed a listing agreement in 1998 with Loretta Eller acting as attorney-in-fact for her mother Margaret Eller. It was Margaret Eller's house to be sold. The price in that agreement was stated as $152,000. On January 22, 1999, Bartron presented a sales contract to Loretta Eller for a price of $96,000. She declined to sign at first but did so on January 28th.
In the companion decision, the Court dismissed out Lois Bartron as a defendant. All references are to him alone.
The house was to be sold in March 22, 1999. The buyer turned around and sold it the same day for $130,000. Bartron received a listing commission from the Ellers. He had not told them, however, that he was working with the buyer to get another buyer and had negotiated with the Ellers' buyer to be paid for his work. And, of course, he said nothing to them about the much higher price.
Loretta Eller found out about Bartron's dealing months later and filed a complaint in early 2000 with the Real Estate Commission. At that time and at the time of the 1998 listing agreement, 1999 sales contract and the March sale, he worked at RE/MAX Realty.
The issue of his role, be it servant, independent contractor agent, or independent contract has been raised in the other case. It remains an open, fact-driven issue. That is why the Court uses the word "worked" so as to reflect the unresolved issues of his status and whether there is or is not vicarious liability.
Apparently, when the people at Realty and Bartron became aware of the complaint, a discussion arose about errors and omission coverage.
Sometime in 2000, however, Wendy Bunch, sole stockholder of RE/MAX Realty undertook merger negotiations with Pettit and ROW. The record is unclear when that merger came to fruition. The Bartrons, when sued by the Ellers, filed a cross-claim against Bunch and Realty. They allege they were assured there was E and O coverage when, they allege, there was not. This, they contend, led them to not get their own coverage as the merger moved along as there could have been a gap in coverage. Any activity at Realty would not be covered by ROW's insurance.
The Bartrons' cross-claim in the other case against Bunch Realty alleges the merger became effective in October, 2000.
The Bartrons allege in this currently separate action that while the merger discussions were proceeding and they were considering whether or not to work at ROW, they asked Bunch and Pettit about coverage and claim both said there was no problem because of the merger. Both, they assert, were aware of the then pending Real Estate Commission proceedings against Wayne Bartron. But after being sued and seeking coverage he was denied it, according to the complaint in this action. He accuses Pettit of misrepresentations and seeks to hold ROW vicariously liable.
One of the motions in the other case challenged whether Bunch had fraudulently misrepresented that there was coverage under Realty's policy. Oral argument on that motion revealed additional discovery was needed. That discovery, as noted in the companion decision, clarifies some issues in that case. It has the same effect here. It seems the supplemental discovery indicates that Realty timely submitted a claims notice to its insurer in 2000. That appears to undercut the circumstance where Bartron was told in 2005 that his claim for coverage was made beyond the reporting deadline in 2002.
Even with this newer information, Bartron charges Bunch and Realty with failure to follow-up with the insurance company in 2000 to determine if there would or would not be coverage. He is also seeking his own follow through with the insurer. But there are other issues either left unresolved or added based on this additional discovery. One of them is that because Bartron may have engaged in fraudulent conduct, no insurance coverage was available. And, or course, this additional discovery did nothing to clarify the issues of Pettit's potential liability, if any.
Discussion
Before the issue of consolidation can be addressed, the Court must address the defendants' motion to dismiss based on grounds of the statute of limitations.
As part of the Eller lawsuit, the Bartrons filed their original cross-claim against Pettit and ROW on August 28, 2002. These defendants moved for summary judgment on April 26, 2006, arguing that the Bartrons should have impleaded their action against them.
This, they asserted, meant that the Bartrons' action was a separate and independent action, that cannot be maintained as part of a third party complaint. They also contended they were not liable to the Bartrons anyway.
Counsel for the Bartrons wrote the Court on May 1, 2006, indicating they were unopposed to the Pettit/ROW summary judgment motion on the impleading ground. But counsel also indicated the Bartrons intended to re-file a separate action and then move to consolidate. Counsel asked the Court to grant the motion without prejudice to do that.
The Court signed on May 3, 2006 the form of order submitted by Pettit and ROW. There is no language in that order stating "without prejudice" or anything else acknowledging the Bartrons' letter of keeping the "door open" to file a new action.
On May 25, 2006, the Bartrons filed their new action as "promised." Their cause of action was the same as that which was dismissed in the earlier action. Later, they added several other causes of action for indemnification and contribution. On October 16, 2006, this Court dismissed those two later filed actions. That act left the Bartrons' action as originally filed the same as their 2002 "cross-claim."
That claim was originally timely filed in 2002 and existed for four years. And, of course, the defendants had full knowledge of it. It would have been preferable, of course, for the order signed on May 3, 2006, to have made it explicit that the award of summary judgment was without prejudice to re-file. The judge signing the order had the Bartrons' position in the motion before signing the order.
There are two approaches to the issue of statute of limitations as a bar to this later filed action. One way is to say that since the original action was timely filed, contains the same claim as the later filed action and the Court had the Bartrons' position on the motion, there is an implicit "without prejudice" in the May 3rd order.
The other approach is to hold that under Civil Rule 60(b), through inadvertence, the Bartrons' are relieved of the effect of that May 3rd order/judgment. The inadvertence is that the form of order signed did not adequately protect the Bartrons' right or ability to re-file the same cause of action a mere three weeks later. On that basis, too, the Pettit/ROW motion for summary judgment on the basis of a statute of limitations bar is denied.
(b) Mistake; inadvertance; excusable neglect; newly discovered evidence; fraud, etc. On motion and upon such terms as are just, the Court may relieve a party or a party's legal representative from a final judgment, order, or proceeding for the following reasons: (1) Mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation or other misconduct of an adverse party; (4) the judgment is void; (5) the judgment has been satisfied, released, or discharged, or a prior judgment upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment should have prospective application; or (6) any other reason justifying relief from the operation of the judgment. A motion under this subdivision does not affect the finality of a judgment or suspend its operation. This Rule does not limit the power of a Court to entertain an independent action to relieve a party from a judgment, order or proceeding, or to grant any relief provided by statute, or to set aside a judgment for fraud upon the Court, or to deal with judgments by confession as provided by law. Writs of coram nobis, coram vobis, and audita querela are abolished, and the procedure for obtaining relief from judgments shall be by motion as prescribed in these Rules or by an independent action.
Del. Super. Ct. R. Civ. P. 60(b)
The defendants also have moved for summary judgment on the basis that there is no liability to the Bartrons. At this stage, however, the record is insufficiently developed and/or there is a need to clarify it. That means the Pettit/ROW motion on the liability issue is not yet ripe for summary judgment.
Ebersole v. Lowengrub, 180 A.2d 467, 470 (Del. 1962).
The remaining motion is that of the Bartrons to consolidate this case with Eller v. Bartron, C.A. No. 02C-03-221-JOH. Superior Court Rule of Civil Procedure 42(a) governs a trial court's power to consolidate:
(a) Consolidation. When actions involving a common question of law or fact are pending before the Court, it may order a joint hearing or trial of any or all the matters in issue in the actions; it may order all the actions consolidated; and it may make such orders concerning proceedings therein as may tend to avoid unnecessary costs or delay.
Del. Super. Ct. R. Civ. P. 42(a).
This rule grants the Court broad discretion "to decide how cases on its docket are to be tried so that the business of the court may be dispatched with expedition and e c on o m y while providing justice to the parties." In deciding the question of consolidation, the Court must first consider whether there exists common questions of law, of fact, or both. "In addressing the issue of commonality, the question is whether there is a sufficient nexus between the cases to warrant consolidation."
Olson v. Motiva Enters., L.L.C., 2003 WL 21733137 (Del.Super.) at *4 quoting 9 Charles A. Wright Arthur R. Miller, Federal Practice and Procedure: Civil 2d § 2381 (2d ed. 1995).
Ison v. E.I. Dupont De Nemours and Co., 2004 WL 2827934 (Del.Super.) at *2.
Id.
However, the Court's analysis should not stop there. The Court must go on to weigh any savings of time, effort or cost against the possibility of delay or inconvenience that consolidation may occasion. "Even where considerations of convenience or savings predominate, a motion to consolidate should not be granted if it would result in undue prejudice or would be fundamentally unfair to one or more of the parties involved, or confuse the jury."
Mirarchi v. Picard, 2002 WL 749164 (Del.Ch. 2002) at *1 citing Joseph v. Shell Oil Co., 498 A.2d 1117 (Del.Ch. 1985).
Ison, 2004 WL 2827934 at *2.
The Court finds that consolidation for discovery and pre-trial matters, such as any additional motions is warranted. The consolidation is not for trial. The insurance coverage claims the Bartrons have raised against Pettit/ROW and Bunch/RE/MAX Realty have sufficient commonality to warrant pre-trial consolidation. The alleged coverage conversation between the Bartrons and the two individual defendants occurred when the two firms were discussing a merger or some other corporate integration and while the Bartrons faced Real Estate Commission action.
Further, the coverage issues revealed in the supplemental discovery undertaken in the Eller case may or may not render this action moot or active. All of this has to be sorted out more.
Conclusion
The summary judgment motion of defendants Pettit and RE/MAX of Wilmington is DENIED. That portion dealing with liability or lack thereof is DENIED without prejudice. The plaintiffs Bartrons' motion to Consolidate is GRANTED for pre-trial purposes.
IT IS SO ORDERED.