Sophie F. Danforth v. Timothy T. More, Nos , 2016 R.I. LEXIS 6 ( 2016 )

Supreme Court
No. 2015-94-Appeal.
No. 2015-127-Appeal.
(PC 11-6528)
Sophie F. Danforth :
v. :
Timothy T. More et al. :
NOTICE: This opinion is subject to formal revision before
publication in the Rhode Island Reporter. Readers are requested to
notify the Opinion Analyst, Supreme Court of Rhode Island,
250 Benefit Street, Providence, Rhode Island 02903, at Telephone
222-3258 of any typographical or other formal errors in order that
corrections may be made before the opinion is published.
Supreme Court
No. 2015-94-Appeal.
No. 2015-127-Appeal.
(PC 11-6528)
Sophie F. Danforth :
v. :
Timothy T. More et al. :
Present: Goldberg, Flaherty, Robinson, and Indeglia, JJ.
OPINION
Justice Indeglia, for the Court. These consolidated cases came before the Supreme
Court on cross-appeals from an order of the Superior Court granting summary judgment in favor
of the plaintiff, Sophie F. Danforth (plaintiff or Danforth). On appeal, the defendant, Timothy T.
More (defendant or More), contends that the hearing justice erred in (1) granting summary
judgment in favor of the plaintiff; and (2) awarding statutory prejudgment interest. In her cross-
appeal, the plaintiff asserts that the hearing justice improperly denied her request for attorney’s
fees. On December 10, 2015, this case came before the Supreme Court pursuant to an order
directing the parties to appear and show cause why the issues raised should not be summarily
decided. After hearing the arguments of counsel and reviewing the memoranda submitted on
behalf of the parties, we are satisfied that cause has not been shown. Accordingly, we shall
decide the appeal at this time without further briefing or argument. For the reasons set forth
herein, we affirm the judgment of the Superior Court.
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I
Facts and Travel
On March 22, 2011, Danforth entered into a purchase and sales agreement (PSA) with
More and his wife, Rebecca (the Mores), pursuant to which she agreed to sell, and the Mores
agreed to purchase, certain real estate (the property) located at 10 Lloyd Lane in Providence.
The PSA provided that the sale price of the property would be $700,000, of which $30,000
would be paid as a deposit at the time the PSA was executed. This deposit was to be paid to
Andrew Davis, Esq. (Davis) as attorney and escrow agent for Danforth. The PSA set a closing
date for October 15, 2011, but also provided that the Mores “may elect to close on any business
day on or after September 1, 2011, and before October 15, 2011[.]”
The PSA provided as a condition to its performance:
“The [Mores] may, at [their] expense, have the [property] inspected for radon,
lead paint, physical condition, termites, rodents and other pests, which inspection
shall be satisfactory to the [Mores] in all respects. If any of the foregoing
inspections are not satisfactory to the [Mores] for any reason, the [Mores] may
elect to notify [Danforth] in writing of the unsatisfactory condition on or before
3:00 p.m. on April 4, 2011 (‘Inspection Contingency Date’) and terminate this
Agreement. In the event [the Mores] elect[] to terminate this Agreement in
accordance with this [section], this Agreement shall be deemed null and void and
the Deposit shall be returned to the [Mores], and the parties will have no further
obligations to each other.”
Importantly, the PSA further provided that “[t]he parties hereto acknowledge and agree that * * *
[t]ime is of the [e]ssence for purposes of the Inspection Contingency Date” and that, if the Mores
found an unsatisfactory condition prior to the inspection contingency date, their sole remedy
would be to terminate the PSA. However, if the Mores failed to invoke their right to terminate
the PSA prior to the inspection contingency date and thereafter defaulted on their obligations, the
PSA provided that “[Danforth] shall have the right to retain the Deposit for [her] own use, which
right shall be [her] sole remedy for such default.”
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The inspection contingency date set for April 4, 2011, came and went with no notification
from the Mores that they intended to exercise their right to terminate the PSA. On April 7, 2011,
the house was inspected; and, following the inspection, More sent Danforth an email, stating: “I
spent over an hour with the house inspector this morning. * * * There are some things that need
to be fixed or replaced * * * but nothing beyond what might be expected. I will email you a
copy of the report when I receive it. Certainly nothing that would cause us to terminate the
contract.” Thereafter, More sent a series of emails to Davis, in which he indicated that the Mores
still intended to go forward with the closing. On April 12, 2011, More sent an email stating:
“The inspection report attached shows two items that [Danforth] might want to address: the
termites in an area of the crawl space and a wood column in the crawl space that has been
compressed because it is carrying too much weight. Otherwise nothing too serious. * * * We
are tentatively looking at a closing date of September 7.” An email sent on April 15, 2011,
provided: “We went to [the property] this morning to do some measuring. It appears that
someone tried to break in the front door. * * * It does not appear that the structural integrity of
the door was compromised but the surface of the door is cracked around the door handle.”
Apparently, the Mores were planning to sell their current house and use the proceeds to
purchase the property. However, their plan was complicated when their “prospective buyers got
cold feet[,]” forcing them to place their house back on the market. As a result of this
complication, More contacted Davis on April 28, 2011, stating, “This may mean that we will not
want to close on September 7.” Another email followed from More on July 18, 2011, in which
he stated: “Query – did you do anything about the termites in the ceiling of the crawl space? We
have no prospects for our house and will need a mortgage to buy yours. Someone just told me
that we may not be able to get financing if there are termites.”
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A series of email correspondence followed, in which More and Davis discussed a
potential closing date. On August 3, 2011, in response to Davis’s request for a closing date,
More indicated, “In the absence of a buyer we are looking at October 15.” Thereafter, More
contacted Davis again on September 12, 2011, this time requesting an extension of the closing
date to December 1, 2011, because the Mores were having difficulty selling their home. Davis
responded on September 14, 2011, indicating that, in order to extend the closing date, Danforth
would require an increased deposit and an upward adjustment of the purchase price. In this
email, Davis reminded More that “‘time is of the essence’ with respect to the purchase
agreement.” Although the closing was scheduled for October 17, 2011, 1 the Mores failed to
appear at it. On October 18, 2011, Davis informed the Mores that they were in default pursuant
to the terms of the PSA. More responded requesting a reduction in the purchase price and an
extension of the period of time to close, which Danforth subsequently declined. 2
On November 14, 2011, Danforth filed a complaint in Providence County Superior
Court, which was subsequently amended on December 5, 2011. In her amended complaint,
Danforth alleged breach of contract (count 1), requesting that she be allowed to retain the Mores’
deposit in the amount of $30,000. In addition, she sought declaratory relief (count 2), asking the
court to “construe the terms of the [PSA] and to order Attorney Davis, the escrow agent, to
disburse the [deposit] to Ms. Danforth.” Finally, the amended complaint also asserted a request
1
From an email exchange between More and Davis, it can be gleaned that October 17, 2011,
would be the latest date on which the closing was scheduled to occur. Specifically, Davis sent an
email to More indicating that he would like to schedule the closing for October 14, 2011. In
reply, More indicated that his “preference is to close Monday [October 17, 2011,] * * * just to
give us another day to make sure the paper work is in place.” There is no evidence that the
closing was extended beyond this date.
2
The property was later sold to a third party in December 2011 for $ 670,000.
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for attorney’s fees (count 3), because—according to Danforth—the Mores were defending the
action “in the complete absence of any justiciable issue of either law or fact.”
On December 19, 2011, the Mores filed an answer, in which they claimed that they “had
no obligation to purchase the [property] because of [Danforth]’s failure to repair termite damage
and vandalism damage that occurred after the inspection date and the closing date specified in
the [PSA] and further assert[ed] that [Danforth] did not tender performance on the closing date.”
In addition, the Mores asserted as a counterclaim that More advised Danforth by an email sent on
April 7, 2011, that her “‘immediate attention’ was required for termites” and that this matter
“needed to be fixed or repaired.” The Mores further asserted that, after executing the PSA, the
front door had been damaged during an attempted break-in. The Mores claimed that this damage
to the property resulted in a breach to the contract because—in their view—the PSA required the
property to be delivered in the same condition that it was in when the PSA was executed.
In due course, Danforth filed a motion for summary judgment, to which the Mores filed a
written objection. 3 At the hearing on the motion for summary judgment, the hearing justice
determined that the PSA required termination by April 4, 2011, and not only did the Mores fail
to terminate the PSA by that date, but they “never attempted to use the termite issue or the door
issue as a reason to cease their obligations under the [PSA].” Accordingly, the hearing justice
granted Danforth’s motion for summary judgment. Additionally, the hearing justice went on to
consider Danforth’s request for attorney’s fees and concluded that, although he did not find merit
in the Mores’ argument, “the issue of termites and the issue of the door was something that was
3
Timothy More, acting pro se and serving as his wife’s attorney, did not appear for the hearing
on the motion for summary judgment. After noting that the court did have the benefit of More’s
written objection and memorandum, the hearing justice considered the motion in his absence.
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raised through e-mail, although not as a reason to terminate. * * * But it was an issue that was
ongoing[.]” Accordingly, he denied Danforth’s request for attorney’s fees.
On January 18, 2013, the hearing justice entered an order granting Danforth’s motion for
summary judgment on counts 1 and 2 of her complaint and on the Mores’ counterclaim. The
order stated that Danforth was entitled to retain the $30,000 deposit, awarded prejudgment
interest on that amount, and denied Danforth’s request for attorney’s fees. On February 6, 2013,
Danforth filed a motion for entry of final judgment, to which the Mores objected. At the hearing
on this motion, the parties disputed whether prejudgment interest was applicable and requested
clarification as to the time period for calculating prejudgment interest. On March 1, 2013, the
hearing justice entered judgment in favor of Danforth, which order stated that the applicable time
period for calculating prejudgment interest was from October 17, 2011 (the date of the scheduled
closing) until January 28, 2013 (the date that More authorized Davis to release the deposit to
Danforth). Both parties timely appealed; in particular, Danforth appealed the denial of attorney’s
fees, and More appealed 4 the grant of summary judgment and award of prejudgment interest.
II
Standard of Review
In reviewing the granting of a motion for summary judgment, this Court engages in a de
novo review, “apply[ing] the same standards and rules as did the motion justice.” Narragansett
Indian Tribe v. State, 81 A.3d 1106, 1109 (R.I. 2014) (quoting Beauregard v. Gouin, 66 A.3d
489, 493 (R.I. 2013)). In so doing, “[w]e view the evidence in the light most favorable to the
nonmoving party.” Id. We will affirm a hearing justice’s grant of a motion for summary
judgment “if there exists no genuine issue of material fact and the moving party is entitled to
4
Notably, Timothy More is the only defendant that has pursued the appeal currently before us.
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judgment as a matter of law.” Takian v. Rafaelian, 53 A.3d 964, 970 (R.I. 2012) (quoting
Classic Entertainment & Sports, Inc. v. Pemberton, 988 A.2d 847, 849 (R.I. 2010)). “The
nonmoving party bears the burden of showing the existence of disputed issues of material fact by
competent evidence; it cannot rest on allegations or denials in the pleadings or on conclusions or
legal opinions.” Id. at 971 (quoting Zanni v. Voccola, 13 A.3d 1068, 1071 (R.I. 2011)).
III
Discussion
On appeal, each party has dug its trenches and lobbed various arguments across the
battlegrounds. More mounts a two-pronged attack. First, he argues that the hearing justice erred
in granting Danforth’s motion for summary judgment because there was a genuine issue of
material fact “as to whether the [property] was in the same condition on the closing date as it was
on the date the [PSA] was executed.” Second, More asserts that the hearing justice erred in
awarding Danforth prejudgment interest because the deposit was in the physical possession of
Danforth’s attorney during the period for which interest was awarded and—according to More—
the suit was not a suit for pecuniary damages as required by G.L. 1956 § 9-21-10. In her counter
attack, Danforth argues that the hearing justice wrongfully declined her request for attorney’s
fees because the Mores “raised no justiciable issue of law or fact to the claims asserted by
[Danforth].” We consider each of these arguments in turn.
A
Summary Judgment
Our inquiry starts with the propriety of the hearing justice’s grant of Danforth’s motion
for summary judgment. More points to a single issue of material fact which he contends should
have precluded the grant of Danforth’s motion. Specifically, he cites to evidence of the presence
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of termites and vandalism related to an attempted break-in and contends that a material fact
existed as to whether the property was in the same condition on the date of the closing as it was
on the date that the PSA was executed.
“It has long been established that when concurrent acts are to be performed by the parties
to a contract, the party bringing suit for breach need only aver that he or she was ready and
willing to perform and that the alleged breacher was requested to perform but refused.” Kottis v.
Cerilli, 612 A.2d 661, 663-64 (R.I. 1992). “When the party alleging the breach demands the
other’s performance of the concurrent act, an offer to perform on the part of the alleging party is
implied and understood.” Id. at 664. It is not necessary that the party alleging the breach
actually perform; instead, “notice of his or her readiness to perform constitutes and implies
tender.” Id.
In the case at hand, the email correspondence between More and Davis make clear that
Danforth was ready and willing to perform on the closing date, but that the Mores were not.
Specifically, on September 12, 2011, More sent Davis an email indicating that he was having
difficulty selling their current house and requested an extension of the closing date to December
1, 2011. After negotiations regarding an extension of the closing date turned out to be fruitless,
the parties settled on a closing date of October 17, 2011. On October 18, 2011, after the Mores
failed to appear at the closing, Davis sent More an email notifying him that they were in default
pursuant to the terms of the PSA. Based on this email correspondence, we conclude that
Danforth’s act of attending the closing constituted sufficient tender of performance and can
support her contract claim.
Nevertheless, More claims that a genuine issue of material fact existed as to whether the
presence of termites and the damaged front door rendered Danforth in breach of the PSA. In
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support of this contention, More points to the following “Conditions of Premises” provision of
the PSA:
“Possession of the [property], free of all tenants, shall be delivered by [Danforth]
to the [Mores] at Closing and the [property] shall be then in the same condition in
which they are now, reasonable use and wear of the Fixtures and buildings
thereon and of any Personal Property and damage by fire and other unavoidable
casualty excepted. OTHER THAN AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, THE BUYER AGREES THAT HE HAS INSPECTED THE
PREMISES, FIXTURES AND PERSONAL PROPERTY, AND HE IS
PURCHASING THE SAME ‘AS IS’ * * *.”
More claims that the presence of the aforementioned defects prevented Danforth from delivering
the property in the same condition that it was in at the time that the PSA was executed. We
consider each of these alleged maladies separately.
Turning first to the alleged damage to the front door resulting from the presumed
attempted break-in, we note that this “Conditions of Premises” provision, by its very terms,
offers no recourse to More. While the provision required the property to be delivered in the
same condition that it was in when the PSA was executed, it also provided that “damage by fire
and other unavoidable casualty [was] excepted.” (Emphasis added.) Here, the Mores provided
no evidence to suggest that the damage from the attempted break-in was somehow avoidable.
Instead, damage from an attempted break-in falls squarely within the classification of “other
unavoidable casualty.” Accordingly, the presence of damage to the front door did not present a
genuine issue of material fact to preclude summary judgment.
We next turn our inquiry to the alleged presence of termites. Despite More’s assertion to
the contrary, the “Conditions of Premises” provision also offers no recourse to him with regard
to any potential termite damage; instead, the PSA provided a separate escape hatch for the
Mores: if they found the property to have any unsatisfactory condition by the inspection
contingency date, they could—upon notification to Danforth—treat the PSA as null and void.
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Indeed, the PSA specifically provided that “[t]he [Mores] may, at [their] expense, have the
[property] inspected for * * * termites” and elect to terminate the agreement if the inspection is
“not satisfactory to the [Mores] for any reason.” To invoke this provision, the PSA required that
the Mores notify Danforth in writing by April 4, 2011, the inspection contingency date. The
PSA further provided that time was of the essence with respect to the inspection contingency
date and that the Mores’ right to terminate the PSA was their sole remedy under the section.
However, the Mores neglected to have the property inspected until April 7, 2011. While this
inspection ultimately exposed the presence of termites, their right to terminate the contract due to
termite damage had already expired, as they had neglected to inspect the property and notify
Danforth of the damage prior to the inspection contingency date. 5 By failing to avail themselves
of the opportunity presented in the PSA to inspect for termite damage, the Mores relinquished
any right to base a claim on such damage. Thus, the alleged presence of termites also did not
preclude summary judgment.
Accordingly, we hold that the hearing justice did not err in granting summary judgment
in favor of Danforth.
B
Prejudgment Interest
Having determined that summary judgment was appropriate, our inquiry now turns to
whether prejudgment interest on the coveted deposit was properly awarded. More asserts that
prejudgment interest should not have been awarded because the Mores received no benefit from
the deposit during the period for which prejudgment interest was awarded, as they did not have
access to it. In support of this contention, he argues that the deposit was in the physical
5
In addition, we note that, even after the discovery of the termites, the Mores indicated that they
were willing to proceed with the sale despite the defect.
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possession of Danforth’s escrow agent and opines that he was under no obligation to sign the
release requested by Danforth. Alternatively, More contends that prejudgment interest is
inappropriate in this case because—according to More—the case at hand is either a declaratory
judgment action or is otherwise equitable in nature and not a suit for pecuniary damages, as
required by § 9-21-10(a). Danforth responds that prejudgment interest was appropriate because
summary judgment was awarded on the breach of contract count in addition to the declaratory
judgment count.
The prejudgment interest statute, § 9-21-10(a), provides, in relevant part: “In any civil
action in which a verdict is rendered or a decision made for pecuniary damages, there shall be
added by the clerk of the court to the amount of damages interest at the rate of twelve percent
(12%) per annum thereon from the date the cause of action accrued, which shall be included in
the judgment entered therein.” Particularly pertinent to the case at hand, our case law has created
various dividing lines with regard to whether a certain claim constitutes “pecuniary damages”
within the meaning of § 9-21-10(a). We consider two of these distinctions as they relate to the
case before us.
First, we have recognized that “[t]he return of a deposit is simply a reimbursement rather
than an award of pecuniary damages, and thus the [prevailing party is] not entitled to the addition
of statutory interest.” Andrews v. Plouff, 66 A.3d 840, 843 (R.I. 2013) (quoting Bogosian v.
Bederman, 823 A.2d 1117, 1121 (R.I. 2003)). In creating this distinction, however, we were
careful to note that “our holding [did] not preclude every plaintiff from recovering prejudgment
interest whenever a deposit is at issue. For example, if a plaintiff were awarded damages in a
breach of contract case involving a deposit, then that plaintiff might well be entitled to statutory
interest under * * * § 9-21-10(a).” Andrews, 66 A.3d at 843 n.2. The case before us
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unquestionably does not involve the return of a deposit, but, instead, involves the retention of a
deposit as a form of damages, as this was Danforth’s sole remedial measure under the PSA.
Thus, the mere fact that a deposit was involved does not preclude Danforth from recovering
statutory interest.
Second, in another context, we held that “[a] determination of benefits, by way of a
declaratory judgment, was not an award of damages[,]” and, therefore, the prevailing party in
such a case “is not entitled to prejudgment interest.” Fravala v. City of Cranston ex rel. Baron,
996 A.2d 696, 708 (R.I. 2010). More argues that the suit before us was declaratory in nature
and, therefore, prejudgment interest cannot be awarded. However, Danforth’s complaint
included both a breach of contract claim and an action for declaratory judgment. In ruling on
Danforth’s summary judgment motion, the hearing justice specifically found that the Mores did
not comply with the terms of the PSA. Accordingly, because there was a breach of contract
claim before the hearing justice and the Mores were found to have breached the terms of the
PSA, prejudgment interest was appropriately awarded. See Turacova v. DeThomas, 45 A.3d
509, 517 (R.I. 2012).
In his final attack, More asserts that prejudgment interest would be improper because
Danforth’s escrow agent was in physical possession of the deposit and he was under no
obligation to sign a release to allow it to be turned over to Danforth. He suggests that
prejudgment interest should not be awarded because the Mores were not in possession of the
deposit and, thus, received no benefit from it. While More’s argument is admittedly creative, it
must fail. This Court has consistently recognized that imposition of prejudgment interest
pursuant to Rhode Island’s prejudgment interest statute “is a ministerial act which does not allow
for any discretion by the judge or the jury.” King v. Huntress, Inc., 94 A.3d 467, 499-500 (R.I.
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2014). Further, we have stated that “[t]he dual purpose of prejudgment interest is to encourage
early settlement of claims and to compensate an injured plaintiff for delay in receiving
compensation to which he or she may be entitled.” Oden v. Schwartz, 71 A.3d 438, 457 (R.I.
2013) (quoting Metropolitan Property & Casualty Insurance Co. v. Barry, 892 A.2d 915, 919
(R.I. 2006)). More’s position places the shoe on the wrong foot: The focus of prejudgment
interest is not on a defendant’s ability to benefit from the money, but, rather, on the plaintiff’s
delay in receiving compensation. See id. During the time in which the deposit remained in
Davis’s account as Danforth’s escrow agent—that is, until the Mores executed written releases—
Danforth did not have access to the compensation to which she was entitled. Under such
circumstances, prejudgment interest was appropriately awarded. Accordingly, we conclude that
the trial justice did not err in awarding prejudgment interest to Danforth pursuant to § 9-21-10(a).
C
Attorney’s Fees
We turn now to Danforth’s contention that attorney’s fees were improperly denied.
Danforth contends that she is entitled to attorney’s fees because the Mores breached the PSA
when they failed to close on the scheduled closing date and because the Mores had no legal or
factual justification for contesting such breach.
This Court has “staunch[ly] adhere[d] to the ‘American rule’ that requires each litigant to
pay its own attorney's fees absent statutory authority or contractual liability.” Shine v. Moreau,
119 A.3d 1, 8 (R.I. 2015) (quoting Moore v. Ballard, 914 A.2d 487, 489 (R.I. 2007)). However,
in certain circumstances, the Legislature has determined that attorney’s fees should be available
to the prevailing litigant. One such circumstance is provided in G.L. 1956 § 9-1-45(1), which
provides that a trial justice may award reasonable attorney’s fees to a prevailing party “in any
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civil action arising from a breach of contract in which the court * * * [f]inds that there was a
complete absence of a justiciable issue of either law or fact raised by the losing party[.]”
We have recognized that “[t]he issue of whether there exists a basis for awarding
attorneys’ fees generally is legal in nature, and therefore our review of such a ruling is de novo.”
Shine, 119 A.3d at 8 (quoting Blue Cross & Blue Shield of Rhode Island v. Najarian, 911 A.2d
706, 709 (R.I. 2006)). If it is determined that there is an adequate legal basis for such an award,
then we review a trial justice’s decision awarding or denying attorneys’ fees for an abuse of
discretion. Id. The parties do not dispute that § 9-1-45 provides an adequate basis for an award
of attorney’s fees; thus, we review the trial justice’s decision denying such fees under an abuse
of discretion rubric. In so doing, we remain mindful that the decision to grant or deny attorney’s
fees is vested within the sound discretion of the trial justice. See Greensleeves, Inc. v. Smiley,
754 A.2d 102, 103 (R.I. 2000) (mem.); Bucci v. Anthony, 667 A.2d 1254, 1256 (R.I. 1995).
In light of the discretion due to the hearing justice, we need not loiter long over this
assignment of error. He determined that the termite problem and damage to the door presented
justiciable issues, even though he ultimately concluded that More’s arguments in that regard
were meritless. We agree, and so cannot conclude that the hearing justice’s determination was
an abuse of his considerable discretion. Accordingly, we perceive no error in the hearing
justice’s denial of attorneys’ fees.
IV
Conclusion
For the reasons set forth above, we affirm the Superior Court’s judgment in all respects.
The materials associated with this case may be remanded to that tribunal.
Chief Justice Suttell did not participate.
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RHODE ISLAND SUPREME COURT CLERK’S OFFICE
Clerk’s Office Order/Opinion Cover Sheet
TITLE OF CASE: Sophie F. Danforth v. Timothy T. More et al.
CASE NO: No. 2015-94-Appeal.
No. 2015-127-Appeal.
(PC 11-6528)
COURT: Supreme Court
DATE OPINION FILED: January 14, 2016
JUSTICES: Goldberg, Flaherty, Robinson, and Indeglia, JJ.
WRITTEN BY: Associate Justice Gilbert V. Indeglia
SOURCE OF APPEAL: Providence County Superior Court
JUDGE FROM LOWER COURT:
Associate Justice Luis M. Matos
ATTORNEYS ON APPEAL:
For Plaintiff: David E. Maglio, Esq.
For Defendant: Timothy J. More, Pro Se