Robert Bried and Stefanie Bried v. Ferro Fuel Oil, Inc. ( 2016 )

IN THE COURT OF COMMON PLEAS FOR THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
ROBERT BRIED )
AND STEFANIE BRIED, )
)
Plaintiffs, )
)
v. ) C.A. No. CPU4-16-001679
)
FERRO FUEL OIL, INC., )
)
Defendant )
Submitted: September 30, 2016
Decided: October 24, 2016
J ames A. Landon, Esquire J ames S. Green, Jr., Esquire
Morris J ames LLP Landis Roth & Cobb LLP
500 Delaware Avenue, Suite 1500 919 Market Street, Suite 1800
P.O. Box 2306 Wilmington, DE 19801
Wilmington, DE 19899 Attorney for Defena'ant
Attorneyfor Plaintijj‘
MEMORANDUM OPINION AND ORDER
ON DEFENDANT’S MOTION TO DISMISS
This is an action for breach of contract The defendant, Ferro Fuel Oil, Inc. (hereinafter
the “Defendant”), brings this motion under Court of Common Pleas Civil Rule 12(b)(6), alleging
this action is barred by the statute of limitations
On September 14, 2016, the Defendant timely filed and noticed the instant Motion to
Dismiss, raising the aforementioned defense. On September 26, 2016, the plaintiffs, Robert and
Stefanie Bried (hereinafter the “Plaintiffs”), filed a Response addressing and opposing the
Motion. On September 30, 2016, a hearing Was convened to allow the parties to present oral
argument. After reviewing the parties’ briefs and arguments, the Court reserved decision. This
is the Final Decision of the Court on the Defendant’s Motion to Dismiss.
STANDARD OF REVIEW
The standard for reviewing a Motion to Dismiss under Civil Rule 12(b)(6) is well settled.
The Court must determine whether the Plaintiffs are entitled, as a matter of law, to recover under
any reasonably conceivable set of circumstances outlined in the Complaint.
In making this determination, the Court is limited to consider only facts contained
within the four corners of the complaint, and must accept all well-plead
allegations as true. “An allegation, though vague or lacking in detail, is
nevertheless ‘well-pleaded’ if it puts the opposing party on notice of the claim
being brought against it.” While the Court is required to accept only those
‘reasonable inferences that logically flow from the face of the complaint,’ [it] ‘is
not required to accept every strained interpretation of the allegations proposed by
the plaintiff.’ Moreover, the Court may dismiss a claim “if allegations in the
complaint or in the exhibits incorporated into the complaint effectively negate the
claim as a matter of law.” Ultimately, “[d]ismissal is warranted only when ‘under
no reasonable interpretation of the facts alleged could the complaint state a claim
for Which relief might be granted.”’l
Accordingly, the Court will presume, for the sake of the instant Motion only, that all assertions
made in the Complaint are true.
FACTS AND PROCEDURAL HISTORY
On June 14, 2016, the Plaintiffs filed a Complaint against the Defendant for Breach of
Contract. The Complaint outlines a series of events stemming from the installation of an HVAC
system in June 2010. The Plaintiffs entered into a contract with the Defendant to install the
HVAC system, in exchange for the agreed-upon price of $10,095.00. However, “[f]rom the
1 Lawver v. Christiana Care Health System, lnc., 2016 WL 2610653, at *3 (Del. Com. Pl. May 6, 2016) (internal
citations omitted).
outset, the HVAC system never worked properly.”2 The Plaintiffs reference numerous instances
where the HVAC system required repairs, with the total cost of those repairs reaching $2,141.54
across five (5) years3 According to the Complaint, the Defendant made “numerous repairs to
the system,” and there is no indication that a third party was utilized to inspect or repair the unit
for any of the necessary repairs4 Finally, in June 2015, the Plaintiffs needed to replace the
control panel, resulting in an additional cost of $1,502.54.
Without specifying how they came to this knowledge, the Plaintiffs assert the “only
reason the control panel goes bad is the result of constant freeze over. . . . [T]his is not common
and a direct result of improper installation.”5 Furthermore, “[t]here Was no Way for Plaintiff s
[sic] to have known that the HVAC was incompletely and improperly installed.”6 The Plaintiffs
assert that, because of this improper installation, they have never had the use and enjoyment of
the HVAC system and must now replace the unit.
On September 14, 2016, the Defendant noticed the instant Motion to Dismiss and raised
the affirmative defense of an elapsed statute of limitations On September 26, 2016, the
Plaintiffs filed a Response to the Motion, asserting the Time of Discovery doctrine as tolling the
statute of limitations A hearing was held on September 30, 2016, with both sides presenting
oral argument The Court reserved judgment and invited the parties to provide supplemental
briefing to the extent they felt it was necessary and advisable to do so. Later that day, the
Defendant provided additional briefing on the matter of judicial admissions
2 Plaintiffs’ Complaint at 11 7.
3 Plaintiffs’ Complaint at 11 9. The Plaintiffs do not assert when these repairs occurred or When they became
necessary, and instead merely reference “numerous” repairs
4 Piaintiffs’ complaint at 11 9.
5 Plaintiffs’ Complaint at 11 13 and 15.
6 Plaintiffs’ Complaint at 1[ 16.
PARTIES’ CONTENTIONS
Both parties agree the instant matter is governed by a three-year statute of limitations7
Likewise, both parties agree that Delaware recognizes numerous exceptions to the statute of
limitations Specifically, it is uncontroverted that the statute of limitations would begin to run in
this matter at the time the Plaintiffs possessed either knowledge of the defect or sufficient
evidence to put them on inquiry notice.
The Defendant offers an argument where, based upon the wording of the Complaint
itself, the Plaintiffs must have been on notice. Specifically, the Defendant argues the Complaint
contains judicial admissions, the substance of which requires this Court to find the Plaintiffs
were on inquiry notice from the moment the HVAC system was installed. As proof, the
Defendant points to the Plaintiffs having asserted they “never had the use and enjoyment of the
HVAC.”8 The Defendant further contends the actual cause of the problem to the HVAC is
immaterial, as the notice of some significant defect involving the HVAC is sufficient to warrant
investigation by the Plaintiffs
In Response, the Plaintiffs point to the fact of the Defendant having performed the repairs
to the HVAC unit. It was not until the control panel needed to be replaced - at considerable
expense - that the Plaintiffs undertook an independent investigation into the problem. The
Plaintiffs also contend that the matter of tolling is a question of fact and is not ripe for review at
this stage of the proceedings
7 See 10 Dei.C. § 8106.
8 Plaintiffs’ Complaint at 11 17.
DISCUSSION
There is no blanket rule preventing a Court from determining on a Motion to Dismiss
whether the applicable statute of limitations has elapsed or, relatedly, whether a tolling doctrine
applies Instead, the Court must determine whether the Complaint, read in the light most
favorable to the non-moving party, pleads sufficient facts to raise the possibility of an exception
to the statute of limitations9 “Assuming a tolling exception has been pleaded adequately, the
Court must then determine when the plaintiff was on inquiry notice of a claim based on the
allegations.”lo The Superior Court has provided ample guidance on this matter:
“The [T]ime of [D]iscovery rule provides that in certain cases, a cause of action
does not accrue until a party has reason to know that he or she has a cause of
action.” The Time of Discovery rule “is narrowly confined in Delaware to
injuries which are both: (a) inherently unknowable; and (b) sustained by a
blamelessly ignorant plaintiff.” The statute of limitations “will begin to run only
upon the discovery of facts constituting the basis of the cause of action or the
existence of facts sufficient to put a person of ordinary intelligence and prudence
on inquiry which, if pursued, would lead to the discovery of such facts” “These
facts must usually be observable or objective factors that Would alert laymen to
the problem.”1
Under the limited facts available to the Court, it is difficult to determine such intricate
questions as knowledge and awareness Ordinarily, it would be “necessary for the Court to
conduct a fact intensive inquiry as to what the Plaintiff knew, when she knew it, and determine
whether the Plaintiff was blamelessly ignorant of her potential claim or dilatory in pursuing the
)312
action. Due to the limitations of a Motion to Dismiss, the Court instead turns to prior
decisions for guidance.
9 See Young & McPherson Funeral Home, Inc. v. Butler’s Home Improvement, LLC, 2015 WL 4656486, at *l (Del.
Super. Aug. 6, 2016).
10 Id
11 Young & McPherson, supra, at *2.
12 Duncan v. O.A. Newton & Sons C0., 2006 WL 2329378, at *7 (Del. Super. Jul. 27, 2006).
5
In Pack & Process, Inc. v. Celotex Corp., the plaintiff purchased a warehouse from the
defendant in 1976. Numerous repairs to the roof were needed in the following years, with the
plaintiff finally learning of the underlying cause in 1981 and filing suit in 1982.13 While Pack &
Process involved an ongoing contractual relationship for repairs, and is thus distinguishable to an
extent from the case sub judice, the nature of the ongoing need for repairs is virtually identical.
From the outset, the Court acknowledged that the injury was not “inherently unknowable,” given
the presence of leaks and other indicators of disrepair.14 In explaining the application of the
Time of Discovery rule, the Court’s analysis is persuasive:
[A]lthough the plaintiff certainly was not “ignoran ” of the existence of problems
with the roof, the plaintiff had no reason to know that the repairs being made were
not due to ordinary wear and tear and was, thus, “blamelessly ignorant.” The
plaintiff not only relied upon the defendant's expertise and assurances concerning
the cause of repairs, but also relied upon the defendant to act in good faith. The
plaintiff could discover any failure by the defendant to perform in a commercially
competent manner at the time of the inspections and repairs only by hiring an
independent roofing specialist to undertake to make the same inspections15
The Defendant has directed the Court to CertainTeed Corp. v. Celotex Corp. , a case from
the Court of Chancery, in which then-Vice Chancellor Strine applied principles relating to the
statute of limitations as set out in Wal-Mart Stores, Inc. v. AIG Life Ins. Co.16 “First, the court
must ascertain the date of accrual of the cause of action. . . . Second, the court must determine
whether the statute of limitations has been tolled. . . . Assuming a tolling exception applies, the
13 See Pack & Process, lnc. v. Celozex Corp., 503 A.2d 646, 648 (Del. super. 1985).
“‘ See zd. at650.
‘5 ld. at 651.
16 The Court notes the following statement in Wal-Mart: “[W]hether . . . the injury [is] “inherently unknowable” to
the [Plaintiffs] is an unresolved question of fact for the jury. Similarly, if the injury is “inherently unknowable,”
whether the [Plaintiffs] are “blamelessly ignorant” is also a question for the jury. Therefore, the Court cannot rule
that, as a matter of law, the “discovery rule” does not toll the statute of limitations” Wal-Mart Stores, Inc. v. AIG
sze Ins. C0., 860 A.2d 312, 319 (Del. 2004). However, because no other cases - whether before or after Wal-Mart
_ have described these questions as solely belonging to the jury, the Court will instead treat this statement as being
particular to the facts of Wal-Mart and therefore distinguishable
6
third step that is required under Wal-Mart is to consider when the plaintiff received inquiry
notice[.]”17 On the third requirement, the Defendant stresses, “Inquiry notice does not require
actual discovery of the reason for injury. Rather, it exists when the plaintiff becomes aware of
‘facts sufficient to put a person of ordinary intelligence and prudence on inquiry which, if
pursued, would lead to the discovery [of injury].’ ”18
The Defendant further supports the proposition that the Plaintiffs are on inquiry notice
even when the underlying cause remains unknown, provided there are sufficient indicators of a
19 However, the Court
problem, by citing to Layton v. Allen, the seminal case on this matter.
notes Layton is a medical malpractice case. Given the vast potential for factual differences
between medical malpractice and the matter at hand, the Court distinguishes Layton on the facts
Applying the case law and the three-part test under Wal-Mart to the case at bar, the Court
finds on the first prong that the date of accrual is June 16, 2010 at the latest. The Complaint
unambiguously alleges an improper installation as the underlying cause of action.20 The accrual
of the cause of action occurs with the performance of the wrongful act which, in this matter, is
allegedly the installation of the HVAC system.21 Second, the Complaint alleges the Plaintiffs did
not have actual notice until June 2015.22 According to the Complaint, the control panel was
replaced after it froze over, and freezing over allegedly occurs only when the unit has been
improperly installed.23 If the Plaintiffs did not know the HVAC unit was improperly installed
until the control panel froze over, then actual notice did not occur until that point. Accordingly,
17 CertainTeed Corp. v. Celotex Corp., 2005 WL 217032, at *7 (Del. Ch. Jan. 24, 2005).
18 Id. (citations omitted).
‘9 Lay¢@n v. Allen, 246 A.2d 794 (Del. 1968).
20 Piaimiffs’ complaint at 11 15.
21 See CertainTeed, supra, at *7.
22 Plaintiffs’ Complaint at 11 ll-16.
23 Plaintiffs’ Complaint at 11 11 and 13.
because the Court must take all well-pled allegations as true, the Plaintiffs have pled sufficient
facts to suggest the statute of limitations was tolled until the point of actual notice.
On the third prong of Wal-Mart, the Court must determine if and when the Plaintiffs were
on inquiry notice. As a preliminary matter, the Court notes installation of an HVAC unit is a
highly technical matter, one that is outside the realm of knowledge of the ordinary layperson.24
Because the applicable standard is whether “a person of ordinary intelligence and prudence”
would detect facts sufficient to warrant further investigation, the technical nature of HVAC
installation weighs in favor of the Plaintiffs25 According to the four corners of the Complaint,
the Plaintiffs experienced numerous problems spread across several years, yet always relied upon
the Defendant to repair the HVAC system.26
The Court is persuaded by the analogous reasoning in Pack & Process, where the
defendant was responsible for repairing the roof it had sold to the plaintiff Although the case
sub judice does not contain a contract for ongoing repairs, this fact does not alter the underlying
legal reasoning of Pack & Process. At its core, Pack & Process dealt with whether a layperson
was on inquiry notice despite knowing the necessity of repairs across multiple years -the precise
issue facing the Court in this case. Contrary to the Defendant’s assertions, and consistent with
the precedent established in Pack & Process, the Court finds it entirely reasonable that a pattern
of malfunctions across multiple years would not alert the average layperson to a problem
involving the installation of an HVAC unit. The asserted cause of the malfunctions was the
installation of the HVAC system. Taking the Plaintiffs’ well-pled allegations as true, “[t]here
was no way to have known that the HVAC was incompleter and improperly installed,” just as
24 See Duncan, supra, at 6; see also Brana't v. Rokeby Realty C0., 2005 WL 1654362, at *l (Del. Super. May 9,
2005);
25 Young & McPherson, supra, at *2.
26 Plaintiffs’ Complaint at 11 9.
there was no way for the plaintiff in Pack & Process to know the roof was improperly
manufactured27
Lastly, the Defendant urges the Court to consider the Plaintiffs’ Complaint as “judicial
28 The Defendant urges the Court to
admissions,” which operate as a limitation on the issues
read the Plaintiffs’ admission of having never had enjoyment of the HVAC unit as waiving any
argument of tolling. ln essence, the Defendant suggests this admission, which is indeed binding
upon the Plaintiffs, demonstrates actual knowledge of the defect from the date of installation in
June 2010. The Court disagrees The Complaint is sufficient on its face. The Plaintiffs allege
“[t]here was no way to have known that the HVAC was incompletely and improperly
installed.”29 Under the high burden of a Motion to Dismiss under Rule l2(b)(6), the Court will
not favor one allegation - that the Plaintiffs never had enjoyment of the HVAC system - over
another allegation that is facially sufficient to allege a lack of inquiry notice. Any alleged
inconsistencies within the Complaint are properly explored in the discovery phase. Accordingly,
under the third prong of the Wal-Mart factors, the Court finds, based upon the limited record
before it, that the Plaintiffs were not on inquiry notice until June 2015.
The Court finds, under the light most favorable to the non-moving party, that the
Complaint pleads sufficient facts to allow the possibility of tolling the statute of limitations The
Court is not in a position at this early stage of the proceedings to delve deeper into the subjective
knowledge and expectations of the parties While discovery might clarify the questions raised by
the Court, the matter is not yet ripe for adjudication
27 Plaintiffs’ Complaint at 11 16; see Pack & Pi'ocess. szrpra, at 651.
28 See Lc:Rrre v. Steel, 2016 WL 5376 l¢i, at *4 (Del. Super. Feb. 10, 2016).
29 Plaintiffs’ Complaint at 1[ 16.
CONCLUSION
For the foregoing reasons, IT IS HEREBY ORDERED this 24th day of October, 2016,
/%
The Honorable Robert H. Surles
Judge
that Defendant’s Motions to Dismiss are DENIED.
10