Petit v. Key Bank of Maine, 7891

• Decision Date: 31 December 1996
• Docket Number: Docket No. YOR-95-329,No. 7891,7891
• Citation: 688 A.2d 427
• Parties: Catherine Duffy PETIT, et al. v. KEY BANK OF MAINE. DecisionLaw
• Court: Maine Supreme Court

Page 427

688 A.2d 427

Catherine Duffy PETIT, et al. v. KEY BANK OF MAINE.

Decision No. 7891.

Law Docket No. YOR-95-329.

Supreme Judicial Court of Maine.

Argued Jan. 4, 1996.

Decided Dec. 31, 1996.

Ronald G. Caron (orally), Caron & Sullivan, Biddeford, for plaintiffs.

Ralph I. Lancaster, John J. Aromando (orally), Pierce Atwood, Portland, for defendant.

Before WATHEN, C.J., and ROBERTS, GLASSMAN, CLIFFORD and LIPEZ, JJ.

GLASSMAN, Justice.

Catherine Duffy Petit, Old Orchard Ocean Pier Company, CDP, Inc., and Whiteway Amusements, Inc. (collectively Petit) ¹ appeal from the summary judgment entered in the Superior Court (York County, Brennan, J.) in favor of Key Bank of Maine on Petit's complaint ² against Key Bank alleging a claim for damages for its wrongful interference with Petit's existing and prospective advantageous economic relationships, inter alia, with Pepperell Trust Company. ³ We agree with Petit's contention that because the evidence on the record generates a genuine issue of material fact the trial court erred by granting Key's motion for a summary judgment, and accordingly, we vacate the judgment.

For the purposes of the summary judgment, the following facts are undisputed: At all relevant times, the Depositors Corporation, a predecessor of Key Bank, was the sole owner of Depositors Trust Company of Southern Maine, also a predecessor of Key Bank. Wallace Haselton was the chief executive officer of Depositors Corporation acting on behalf of that corporation and Depositors Trust Company. Robert Mitchell was the president of Pepperell Trust Company. In September 1979, Petit borrowed $1,350,000 from a group of lenders, including Pepperell Trust Company, the lead lender, and Depositors Trust, for the purpose of acquiring a pier and amusement park business at Old Orchard Beach. In the fall of 1981, Petit initiated discussions with the participating lenders for the refinancing of the 1979 loan. In early December 1981, in connection with an ongoing investigation of the Depositors Corporation and the Depositors Trust conducted by the Maine Attorney General's office in conjunction with the Federal Bureau of Investigation with regard to possible violations of state and federal laws, Haselton stated to an agent of the Attorney General's office that Catherine Petit had alleged that Mitchell took an illegal fee or "kickback" in connection with Pepperell's participation in the 1979 loan to Petit, knowing such statement to be false.

On January 8, 1982, Petit met with the 1979 participating lenders to present a refinancing proposal. At this meeting Mitchell refused to speak with Petit, acted in a "cool and aloof" manner toward her, and left the meeting while it was in progress. By a letter dated February 3, 1982, Mitchell informed Petit that Pepperell and the other banks that had participated in the 1979 loan had declined her refinancing proposal and that "unless your loan account is brought current by March 4, 1982, foreclosure proceedings will commence in order to effect collection." In September 1982, Pepperell filed foreclosure proceedings for the September 1979 loans. Thereafter, Petit filed for bankruptcy resulting in her loss of ownership of the amusement park and pier.

Following Key Bank's answer to Petit's fourth amended complaint, it filed a motion for a summary judgment on the ground that the record before the court does not generate any genuine issue of material fact and that Key is entitled to a judgment as a matter of law. By its memorandum in support of its motion, Key Bank focused on the inability of Petit to establish that Mitchell knew of Haselton's false statement prior to February 3, 1982, and alleged that, although adequately pleaded, Petit could not establish causation or, accordingly, that Mitchell justifiably relied on such statement as true or acted on it to Petit's damage. Attached to and incorporated in Petit's responsive memorandum opposing Key Bank's motion, is an affidavit of Craig J. Rancourt, a personal friend of Mitchell, asserting in pertinent part that during conversations with Mitchell in December 1981 and January 1982: (1) "Mitchell stated ... Petit had accused him of accepting a bribe in connection with loans from Pepperell to Petit," (2) "expressed extreme personal animosity toward Mrs. Petit," and (3) "stated ... that he intended to foreclose on Petit's loans."

At the January 25, 1995, hearing on Key Bank's motion, it advanced the same argument set forth in its memorandum and argued against the trial court's consideration of the Rancourt affidavit on the ground that "it was late in the discovery period" and that it was hearsay. In the course of the hearing, and in response to Key Bank's argument that discovery had closed, the trial court advised Key Bank it could conduct further discovery if it did so prior to the court's ruling on the summary judgment motion. Key Bank chose to rely on its argument on that issue.

By its order dated May 4, 1995, the trial court granted the motion for a summary judgment in favor of Key Bank, stating:

On the record before this Court, as a matter of law, Plaintiffs cannot prove all of the essential elements necessary under Maine law to support their claim for tortious interference with advantageous economic relationships. Specifically, Plaintiffs cannot on that record carry their burden to prove a causal connection between the tortious interference alleged and termination of the economic relationship alleged.... For purposes of this Motion, I have considered Mr. Rancourt's affidavit for its substantive value. Notwithstanding this affidavit, Plaintiff has failed to generate genuine issues of material fact requiring trial.

From the judgment entered in accordance with the court's order, Petit appeals.

"A summary judgment is proper when the party that bears the burden of proof of an essential element at trial has presented evidence that, if it presented no more, would entitle the opposing party to a judgment as a matter of law." Jacques v. Pioneer Plastics, Inc., 676 A.2d 504, 506 (Me.1996). In our review of the grant of a summary judgment, we view the evidence in the light most favorable to the nonprevailing party and independently determine whether the record supports the trial court's determination that there is no genuine issue of material fact and the prevailing party is entitled to a judgment as a matter of law. Id.

Relying primarily on the Rancourt affidavit, as Petit did before the trial court, Petit contends the record contains sufficient evidence to generate a genuine issue of a material fact to be determined by a factfinder at the trial of this case as to whether the false statement of Haselton caused the termination of the advantageous economic relationships alleged by Petit. Viewing that affidavit in the light most favorable to Petit, as we must, we agree with Petit's contention. Accordingly, we conclude that it was error for the trial court to grant Key Bank's motion for a summary judgment in its favor.

Contrary to Key Bank's contention, we find no error in the trial court's consideration of the Rancourt affidavit, nor do the assertions contained in the affidavit constitute inadmissible hearsay. The affiant's first assertion is not hearsay because it is not a statement "offered in evidence to prove the truth of the matter asserted." M.R.Evid. 801(c). The second and third assertions are admissible pursuant to M.R.Evid. 803(3) as statements of Mitchell's "then existing state of mind...."

Although not raised by either of the parties before the trial court or before us, some time after oral argument on this case we requested that each of the parties file a supplemental brief addressing the standard of proof required to allow a plaintiff to prevail on a claim for the wrongful interference with existing and prospective advantageous economic relationships. We made the request in the interest of judicial economy, being cognizant that we have not previously specifically addressed the precise issue, that it may become an issue in any future pretrial proceedings, that it will be essential for the guidance of a factfinder at the trial of this case, that this proceeding has been pending since 1986, and that the present appeal is the third pretrial appeal in the course of this litigation.

We have previously stated that the "[i]nterference with an advantageous relationship requires the existence of a valid contract or prospective economic advantage, interference with that contract or advantage through fraud or intimidation, and damages proximately caused by the interference." Barnes v. Zappia, 658 A.2d 1086, 1090 (Me.1995). We have also previously set forth the elements of interference by "fraud" as: "(1) mak[ing] a false representation (2) of a material fact (3) with knowledge of its falsity or in reckless disregard of whether it is true or false (4) for the purpose of inducing another to act or refrain from acting in reliance on it, and (5) the other person justifiably relies on the representation as true and acts upon it to the damage of the plaintiff." Grover v. Minette-Mills, Inc., 638 A.2d 712, 716 (Me.1994).

We have long recognized and applied the general rule that a plaintiff's burden of proof in a civil action is to establish each factual element of a claim by a preponderance of the evidence. Notwithstanding this general rule, in certain circumstances, including civil actions involving allegations of fraud, we have required the higher standard of clear and convincing evidence. See, e.g., Arbour v. Hazelton, 534 A.2d 1303, 1305 (Me.1987) (stating clear and convincing evidence standard for claim that real estate agent of defendant-seller had fraudulently misrepresented source of store's gross sales). But see Harmon v. Harmon, 404 A.2d 1020, 1026 (Me.1979) (stating preponderance of evidence standard for claim of tortious interference by fraud and undue influence with plaintiff's expected legacy).

The question before ...