Vt. State Employees Credit v. Moats ( 2019 )

Vt. State Employees Credit v. Moats, No. 548-9-18 Wncv (Tomasi, J., Oct. 7, 2019).
[The text of this Vermont trial court opinion is unofficial. It has been reformatted from the original. The accuracy of the text
and the accompanying data included in the Vermont trial court opinion database is not guaranteed.]
STATE OF VERMONT
SUPERIOR COURT CIVIL DIVISION
Washington Unit Docket No. 548-9-18 Wncv
Vermont State Employees Credit,
Plaintiff
v.
ENTRY ORDER
Jared W. Moats,
Structural Energy Corporation,
Defendants
On September 10, 2019, this Court held a hearing on Plaintiff’s motion for
default judgment and damages. The Court made findings on the record and
determined that Plaintiff was entitled to judgment as to all claims, save the cause of
action for violation of Vermont’s Consumer Fraud Act (CFA). It also made findings
as to the amount of damages incurred by Plaintiff. Lastly, it granted Plaintiff leave
to file a memorandum arguing why default was also appropriate to the CFA count.
Plaintiff has now filed that memorandum, and the Court makes the following
determinations.
This case arises out of a loan made by Plaintiff to Defendant Moats. The loan
was for Plaintiff to obtain energy related goods and services at his residence from
Defendant Structural Engineering Corporation (SEC). The terms of that loan are
set out in Exhibit 1 to the Complaint. In summary, the Plaintiff agreed to loan
Defendant Moats roughly $60,000 for those home improvements, which were to be
completed by SEC. The Plaintiff was to forward the check to SEC for that work,
and Defendant Moats was to repay the loaned amounts to the Plaintiff -- with
interest.
Defendants failed to disclose that Moats was also the owner and operator of
SEC. SEC (and Moats) took the money but did not install any goods in Moats’
home, and Moats did not repay the loaned money to the Plaintiff.
Plaintiff brought a complaint alleging breach of the loan agreement by Moats;
and claims of fraud, negligent misrepresentation, and violation of the CFA by both
Defendants.
With regard to the CFA, Plaintiff maintains that it has standing to bring an
action because it is a “consumer.” After considering the Plaintiff’s arguments and
the statutory provisions at issue, the Court disagrees.
To bring an action under the CFA, the plaintiff must be “a consumer who
contracts for goods or services in reliance upon false or fraudulent representations
or practices….” 9 V.S.A. § 2461. The CFA provides the following additional
definitions:
“Consumer” means any person who purchases, leases, contracts for, or
otherwise agrees to pay consideration for goods or services not for
resale in the ordinary course of his or her trade or business but for his
or her use or benefit or the use or benefit of a member of his or her
household, or in connection with the operation of his or her household
or a farm whether or not the farm is conducted as a trade or business,
or a person who purchases, leases, contracts for, or otherwise agrees to
pay consideration for goods or services not for resale in the ordinary
course of his or her trade or business but for the use or benefit of his or
her business or in connection with the operation of his or her business.
“Goods” or “services” shall include any objects, wares, goods,
commodities, work, labor, intangibles, courses of instruction or
training, securities, bonds, debentures, stocks, real estate, or other
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property or services of any kind. The term also includes bottled
liquified petroleum (LP or propane) gas.
Id. § 2451a (West).
In the transaction at issue in this case, the Plaintiff did not purchase goods or
services for itself, and that was not the intent of the deal. The Plaintiff was
subsidizing Moats’ purchase of goods and services for his home and that were to
benefit him.
The Plaintiff mischaracterizes the holding of Elkins v. Microsoft Corp., 174
Vt. 328, 331 (2002), to support its position. Elkins allowed an “indirect purchaser”
to bring a claim under the CFA. In that case, a person who purchased a computer
that came with a Microsoft operating system was allowed to bring a CFA action
against Microsoft even though he did not have a direct contractual relationship with
that company. The key difference between that case and this one is that the
plaintiff in Elkins actually was the intended recipient of and did receive “goods” in
the form of a computer and computer program. The Plaintiff can make no such
claim here.
Nor does the fact that Plaintiff provided funds directly to SEC change that
conclusion. The Plaintiff provided the borrowed money directly to SEC, as provided
in the loan agreement attached at Exhibit 1. It did so on behalf of Moats. Moats
was to receive goods and services from SEC, and Moats was to repay the Plaintiff
with interest. The Plaintiff did not contract with SEC for goods or services for its
benefit and has brought no claim for breach of contract against SEC.
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No doubt, the CFA is a remedial law that is entitled to a liberal construction
to meet the goals of the law. Id. at 331. That does not mean the Court is free to
rewrite the law to include plaintiffs who have not contracted for goods or services.
WHEREFORE, the Court concludes that the Plaintiff does not prevail on its
CFA claim. On the remaining claims, as noted at hearing, it is entitled to damages
in the amount of $59,959.74. As provided in Exhibit 1 and in Vt. R. Civ. P. 54, it is
also entitled to reasonable court and collection costs. In this case, those costs are
detailed in the Plaintiff’s motion for default and include: private investigator
services ($54.50), court filing fee ($295.00), publication fee for alternative service
($133.00), and service of process fees ($58.00).
Accordingly, Plaintiff is entitled to judgment against Defendants in the total
sum of $60,500.24.
Electronically signed on October 07, 2019 at 09:53 AM pursuant to V.R.E.F.
7(d).
________________________
Timothy B. Tomasi
Superior Court Judge
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