Hatteras/Cabo Yachts, LLC v. M/Y Epic
| Decision Date | 28 September 2020 |
| Docket Number | No. 4:17-CV-00025-BR,4:17-CV-00025-BR |
| Court | U.S. District Court — Eastern District of North Carolina |
| Parties | HATTERAS/CABO YACHTS, LLC, a foreign limited liability company, Plaintiff, v. M/Y EPIC (Official Number 747618, HIN: US-HATHR3021617), her engines, Boilers, tackle, apparel etc., in rem, and AQUAVIVA LTD., a foreign company, Defendants. |
This matter is before the court on Hatteras/Cabo Yachts, LLC's ("Hatteras") motion for summary judgment as to Counts 1-7, 12, 14, and 15 of Acquaviva Ltd. ("Acquaviva") and Daniel Spisso's (collectively "Spisso")1 Second Amended Counterclaim ("Counterclaim"), (DE # 122); Versa Capital Management, LLC's ("Versa") motion for summary judgment as to Counts 1, 2, 5, 8-14 of the Counterclaim, (DE # 119);2 and Brunswick Corporation's ("Brunswick") motion for summary judgment as to Counts 1, 2, 5, 8-10, 13, and 14 of the Counterclaim,3 (DE # 116). Also before the court is Spisso's motion for summary judgment on Counts 2, 6, and 7 ofthe Counterclaim, (DE # 125), and Acquaviva's motion for summary judgment on all claims alleged in Hatteras's original verified complaint, (DE # 130-1). These motions have been fully briefed and are ripe for disposition.
I. BACKGROUND
This action arises out of disputes regarding the purchase of two yachts. Spisso, Acquaviva's agent, first entered into a sales contract with the Hatteras Yachts division of Brunswick for the construction of a model GT63 ("Vessel No. 1"), in December 2012. (Brunswick Statement of Facts, DE # 118, ¶ 2; Spisso Resp. to Brunswick Statement of Facts, DE # 151, ¶ 2.) In August 2013, Hatteras purchased substantially all of the assets of the Hatteras Yachts division of Brunswick. (Brunswick Statement of Facts, DE # 118, ¶ 3; Spisso Resp. to Brunswick Statement of Facts, DE # 151, ¶ 3.) In December 2014, Spisso filed suit in the Southern District of Florida, Case No. 1:14-cv-24616-FAM, alleging breach of contract, breach of warranties, and violation of the Magnuson-Moss Warranty Act, and seeking rescission, revocation, and damages arising from the purchase of Vessel No. 1. (See Brunswick Statement of Facts, DE # 118, ¶ 7; Spisso Resp. to Brunswick Statement of Facts, DE # 151, ¶ 7.) In April 2015, Spisso entered into a settlement agreement ("Agreement") which purported to resolve the litigation surrounding Vessel No. 1 and constituted a purchase/sale of Vessel No. 2. (Brunswick Statement of Facts, DE # 118, ¶ 8; Spisso Resp. to Brunswick Statement of Facts, DE # 151, ¶ 8.)
On 17 September 2016, one day into its maiden voyage, Vessel No. 2 caught fire with Spisso and guests onboard. (Brunswick Statement of Facts, DE # 118, ¶¶ 17, 19; Spisso Resp. to Brunswick Statement of Facts, DE # 151, ¶¶ 17, 19.) Thereafter, Vessel No. 2 was returned to shore where Hatteras took custody of it. (Compl., DE # 1, ¶ 8; Acquaviva Answer, DE # 30, ¶8.) Hatteras notified Spisso that expenses for necessaries were accruing while the vessel remained in its possession. (Compl., DE # 1, ¶¶ 11-16; Acquaviva Answer, DE # 30, ¶¶ 11-16.) The vessel remained at Hatteras's dock until Spisso ultimately retook possession of the vessel in February 2017. (Compl., DE # 1, ¶ 19; Acquaviva Answer, DE # 30, ¶ 19.) During that five month period, Hatteras alleges that the costs associated with the provision of necessaries totaled $24,340.52. (Compl., DE # 1, ¶ 17.)
On 24 August 2018, Hatteras moved to dismiss Acquaviva's 18 June 2018 counterclaim. "Thereafter, Spisso filed a motion to intervene as defendant and counterclaim [against Hatteras] and attached an amended counterclaim on behalf of himself and Acquaviva." On 10 January 2019, this court allowed Spisso's motion to intervene by interlineation and allowed Acquaviva and Spisso to amend their counterclaim. As such, the court denied Hatteras'[s] motion to dismiss the 18 June 2018 counterclaim.
(Order, DE # 168, at 2 (citations omitted).) Hatteras, Brunswick, and Versa (collectively "counterclaim defendants") then each moved to dismiss the amended counterclaim. (DE ## 59, 85, 87.) The court denied all three motions to dismiss but granted Brunswick's and Versa's motions for more definite statements as to counts 5, 8, 10, and 14 of the amended counterclaim. (Order, DE # 98.) Spisso then filed a second amended counterclaim, on which counterclaim defendants each now seek summary judgment.
III. DISCUSSION
Summary judgment is appropriate when the record reveals "that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A genuine disputeexists "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248. A fact is material if its existence or non-existence affects the disposition of the case. Id. The party seeking summary judgment must first demonstrate the absence of any genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The nonmoving party "must [then] come forward with specific facts showing that there is a genuine issue for trial." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (emphasis and quotation omitted). "[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson, 477 U.S. at 247-48 (emphases in original). In determining whether a genuine issue of material fact exists, the court must view the evidence and the inferences drawn therefrom in the light most favorable to the nonmoving party. Scott v. Harris, 550 U.S. 372, 378 (2007). When considering cross-motions for summary judgment, the court should "consider and rule upon each party's motion separately and determine whether summary judgment is appropriate as to each under the Rule 56 standard." Monumental Paving & Excavating, Inc. v. Penn. Mfr. Ass'n Ins. Co., 176 F.3d 794, 797 (4th Cir. 1999).
Counts 2, 8, 9, 10, and 14 (in part) relate to Vessel No. 2. (See Second Am. Countercl., DE # 99.) Specifically, count 2 alleges breach of the Agreement; count 8 alleges violations of the Magnuson-Moss Warranty Act pertaining to Vessel No. 2; counts 9 and 10 allege negligent property damage and negligent bodily injury stemming from the fire aboard Vessel No. 2; andcount 14 alleges violations of North Carolina's Unfair and Deceptive Trade Practices Act ("UDTPA"). (Id.)
Brunswick moves for summary judgment on these counts, contending "it was not a party to the contract to purchase [Vessel No. 2], and Hatteras was not its agent for purposes of any dealings with [] Spisso or Acquaviva." (Brunswick Mem. Supp., DE # 117, at 2.) According to Brunswick, it sold the Hatteras Yachts division in 2013 and was uninvolved with the sale, construction, delivery, or fire aboard Vessel No. 2. (Id. at 16.) Spisso claims Brunswick was a party to the Agreement or, alternatively, is liable on the contract based on principles of agency. (See Spisso Mem. Opp'n, DE # 152, at 4-5.)
In 2015, Spisso entered the Agreement, which purported to resolve his claims regarding Vessel No. 1 and constituted his purchase of Vessel No. 2. Spisso first argues, and Brunswick agrees, Brunswick is an intended third-party beneficiary of the Agreement. (Spisso Mem. Opp'n, DE # 152, at 4; Brunswick Reply, DE # 176, at 4; see Second Am. Countercl., DE # 99, at 56.) Spisso contends this status makes Brunswick a party to the Agreement and thus makes Brunswick liable for the alleged breach thereof along with harms he suffered relating to Vessel No. 2. (See Spisso Mem. Opp'n, DE # 152, at 4-5.)
"A settlement agreement is a contract governed by the rules of contract interpretation and enforcement." Williams v. Habul, 724 S.E.2d 104, 110 (N.C. Ct. App. 2012) (citations omitted). It is well established that an intended third-party beneficiary may sue for breach of a contract entered for its benefit. Snyder v. Freeman, 266 S.E.2d 593, 603-04 (N.C. 1980); see also Vogel v. Reed Supply Co., 177 S.E.2d 273, 278 (N.C. 1970) ().However, to be liable for breach, one must be a party to the contract. Howe v. Links Club Condo. Ass'n, 823 S.E.2d 439, 448 (N.C. Ct. App. 2018). An intended third-party beneficiary is not a party to the contract itself, but merely receives some benefit from it.
Here, although Brunswick may have some rights under the Agreement as a third-party beneficiary, such status in and of itself does not subject it to liability thereon. Spisso's claims against Brunswick relating to Vessel No. 2 cannot survive summary judgment on this basis.
Alternatively, Spisso claims Brunswick should be liable on the counts relating to Vessel No. 2 because Hatteras acted as its agent, either actual or apparent, in procuring the Agreement. (Spisso Mem. Opp'n, DE # 152, at 5-6.) Brunswick contends it did not authorize Hatteras to act with regard to the Agreement, nor did Hatteras consent to do so. (Brunswick Mem. Supp., DE # 117, at 17.)
Sullivan v. Pugh, 258 N.C. App. 691, 695 (N.C. Ct. App. 2018) (quoting Leiber v. Arboretum...
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