Rhododendron Furniture & Design v. Marshall

• Decision Date: 24 November 2003
• Docket Number: No. 31262.,31262.
• Citation: 214 W.Va. 463,590 S.E.2d 656
• Court: West Virginia Supreme Court
• Parties: RHODODENDRON FURNITURE & DESIGN, INC., a West Virginia corporation, Plaintiff Below, Appellant, v. Marianna MARSHALL, Defendant Below, Appellee.

590 S.E.2d 656

214 W.Va. 463

RHODODENDRON FURNITURE & DESIGN, INC., a West Virginia corporation, Plaintiff Below, Appellant, v. Marianna MARSHALL, Defendant Below, Appellee.

No. 31262.

Supreme Court of Appeals of West Virginia.

Submitted September 24, 2003.

Decided November 24, 2003.

Timothy J. LaFon, Esq., Ciccarello, DelGiudice & LaFon, Charleston, for Appellant.

George J. Cosenza, Esq., Cosenza, Underwood & Merriman, Parkersburg, for Appellee.

PER CURIAM.

The appellant Rhododendron Furniture & Design, Inc. appeals the Wood County Circuit Court's dismissal of the appellant's collection action. We affirm the circuit court's ruling with certain admonitions.

I.

During the years of 1996, 1997, and 1998, the appellee Marianna Marshall was president of the appellant-corporation Rhododendron Furniture & Design, Inc. ("Rhododendron Furniture"), and Ms. Marshall owned fifty percent of Rhododendron Furniture's outstanding stock. During those years, Rhododendron Furniture's current president Scott Quillen held the remaining fifty percent of the outstanding shares and worked as the corporation's treasurer and secretary.

In 1998, Mr. Quillen sued Marianna Marshall and Rhododendron Furniture & Design, Inc.¹ In his suit, Mr. Quillen alleged that Ms. Marshall had mismanaged Rhododendron Furniture.

In July of 1999, the parties reached a settlement. As part of the settlement agreement, Ms. Marshall conveyed all her Rhododendron Furniture stock to Mr. Quillen, and Mr. Quillen agreed to dismiss his suit against Ms. Marshall with prejudice. According to the language of the settlement agreement, the parties agreed to execute a "[r]elease that releases each from any and all claims arising from allegations in the lawsuit and/or in any way related to this joint ownership and/or involvement in any fashion with Rhododendron." On July 30, 1999, the parties executed a release pursuant to the settlement agreement. The release stated, in part, that:

... [SCOTT] QUILLEN and RHODODENDRON [FURNITURE], their agents, servants, employees, heirs, predecessors, successors, assigns and representatives, hereby release and forever discharge [MARIANNA] MARSHALL and REFUEL, [INC.], for themselves, their agents, servants, employees, heirs, predecessors, successors, assigns, and representative, from all claims, demands, and causes of action that QUILLEN or RHODODENDRON may now have, known or unknown, and whether or not any such claims may be knowable to or be discoverable by QUILLEN or RHODODENDRON against MARSHALL and REFUEL.

Mr. Quillen asserts that shortly after he became president of Rhododendron Furniture, he discovered $17,000.00 in unpaid loans made by Rhododendron Furniture to Ms. Marshall. After Ms. Marshall declined to pay the $17,000.00 that Mr. Quillen claimed she owed, Rhododendron Furniture filed this action to collect the $17,000.00.

In its complaint, Rhododendron Furniture states that "[t]hese loans are documented on the Plaintiff's [Rhododendron Furniture] tax returns for the years of 1996, 1997, and 1998, which were signed by the Defendant [Marianna Marshall] and on the books and records of the Plaintiff corporation which were maintained by the Defendant."

In response to Rhododendron Furniture's complaint, Ms. Marshall filed a motion to dismiss and attached the release in support of her motion.

Rhododendron Furniture responded to Ms. Marshall's motion to dismiss by filing a response and attaching the settlement agreement. Rhododendron Furniture argued that the release offered by Ms. Marshall did not excuse her from having to repay the loan. Specifically, Rhododendron Furniture pointed to two sections in the settlement agreement and release that dealt with warranties and other representations. The first warranty section, in the settlement agreement, stated that Ms. Marshall "represents and warrants that all liens, encumbrances and liabilities of Rhododendron were fairly and clearly represented in the books and records of said Corporation." The second section, in the release, states that "all representations and warranties in the July 04, 1999 [settlement] agreement between the parties shall survive the closing and execution of this release."

Based on these two sections of the settlement agreement, Rhododendron Furniture contended that the release did not cover the $17,000.00 in loans because the loans were not adequately shown in Rhododendron Furniture's business records. In support of its allegations, Rhododendron Furniture submitted the affidavit of an accounting expert who stated that the $17,000.00 in loans were not fairly and clearly represented in Rhododendron Furniture's business records.

The circuit court held a hearing on Ms. Marshall's motion, and, on January 22, 2002, granted Ms. Marshall's motion to dismiss. The circuit court dismissed the claim "based upon an examination of the file, the release executed by the parties, and it appearing proper to do so."

Rhododendron Furniture appeals from the circuit court's ruling granting the motion to dismiss. We affirm the circuit court's order dismissing the appellant's action.

I.

This Court reviews a circuit court's order granting a motion to dismiss under a de novo standard. "Appellate review of a circuit court's order granting a motion to dismiss a complaint is de novo." Syllabus Point 2, State ex rel. McGraw v. Scott Runyan Pontiac-Buick, Inc., 194 W.Va. 770, 461 S.E.2d 516 (1995). We also review orders granting summary judgments de novo. "A circuit court's entry of summary judgment is reviewed de novo." Syllabus Point 1, Painter v. Peavy, ...