Hoover v. Moran

• Decision Date: 14 March 2008
• Docket Number: No. 33460.,33460.
• Court: West Virginia Supreme Court
• Parties: Johnnie HOOVER, Plaintiff Below, Appellant, v. Peter K. MORAN, Defendant Below, Appellee.

662 S.E.2d 711

222 W.Va. 112

Johnnie HOOVER, Plaintiff Below, Appellant, v. Peter K. MORAN, Defendant Below, Appellee.

No. 33460.

Supreme Court of Appeals of West Virginia.

Submitted February 27, 2008.

Decided March 14, 2008.

Syllabus by the Court

1. "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).

2. "Under Rule 9(a) [of the] West Virginia Rules of Civil Procedure, it is not necessary to aver the capacity of a party to sue or be sued." Syllabus point 1, Musgrove v. Hickory Inn, Inc., 168 W.Va. 65, 281 S.E.2d 499 (1981).

3. "Whether words used in connection with the name of a . . . defendant in a case are to be considered as descriptive of the person, or of the character in which he . . . is sued, is to be determined from all the allegations of the pleading filed by the plaintiff." Syllabus point 1, in part, Marion v. Chandler, 139 W.Va. 596, 81 S.E.2d 89 (1954).

4. "A promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce the action or forbearance is enforceable notwithstanding the Statute of Frauds if injustice can be avoided only by enforcement of the promise. The remedy granted for breach is to be limited as justice requires.

"In determining whether injustice can be avoided only by enforcement of the promise, the following circumstances are significant: (a) the availability and adequacy of other remedies, particularly cancellation and restitution; (b) the definite and substantial character of the action or forbearance in relation to the remedy sought; (c) the extent to which the action or forbearance corroborates evidence of the making and terms of the promise, or the making and terms are otherwise established by clear and convincing evidence; (d) the reasonableness of the action or forbearance; (e) the extent to which the action or forbearance was foreseeable by the promisor." Syllabus point 3, Everett v. Brown, 174 W.Va. 35, 321 S.E.2d 685 (1984).

5. "Before a court may dismiss an action under Rule 41(b), notice and an opportunity to be heard must be given to all parties of record." Syllabus point 2, in part, Dimon v. Mansy, 198 W.Va. 40, 479 S.E.2d 339 (1996).

Stephen P. Meyer, Meyer & Ford, Charleston, for Appellant.

Benjamin L. Bailey, Christopher A. Morris, Bailey & Glasser, Charleston, for Appellee.

PER CURIAM:

Johnnie Hoover, appellant/plaintiff below, appeals from an order of the Circuit Court of Kanawha County that dismissed his complaint against Peter K. Moran, appellee/defendant below. The circuit court dismissed the action under Rule 12(b)(6) of the West Virginia Rules of Civil Procedure for failure to state a claim against Mr. Moran in his individual capacity. Here, Mr. Hoover contends that his complaint adequately stated a cause of action against Mr. Moran in his individual capacity. In a cross-appeal filed by Mr. Moran, he contends that the circuit court committed error in reinstating Mr. Hoover's complaint after it was initially dismissed, under Rule 41(b) of the West Virginia Rules of Civil Procedure, for inactivity for more than one year. After a careful review of the record, briefs, and consideration of the arguments by the parties, we affirm the trial court's order reinstating the case under Rule 41(b), but reverse the order dismissing the case under Rule 12(b)(6).

I. FACTUAL AND PROCEDURAL BACKGROUND

This case arises out of Mr. Hoover's employment with Princess Beverly Coal Company (hereinafter "Coal Company"). Mr. Hoover worked as a mechanic, welder and equipment operator for the Coal Company from July 29, 1984, through February 29, 2000. The president of the Coal Company during this period was Mr. Moran. Mr. Hoover asserted in his complaint that on several occasions from the mid-1980s until the early 1990s, the Coal Company experienced financial difficulties in paying employee wages and purchasing equipment. As a consequence of the financial difficulties, Mr. Hoover alleged that on several occasions Mr. Moran borrowed money from him to help meet the obligations of the Coal Company.

The loan that is relevant to this appeal occurred on or about February 5, 1985. At that time, and at the request of Mr. Moran, Mr. Hoover loaned the Coal Company $20,000.00. The loan was to be repaid within sixty days. However, Mr. Hoover asserts that a few days before the loan was due to be repaid, Mr. Moran requested an extension of time to repay the loan. Further, Mr. Hoover asserted in the complaint that the consideration for the extension and late repayment was a promise made by Mr. Moran that 10% of the profits from the sale of the Coal Company would be paid to Mr. Hoover should the business ever be sold. This agreement was never reduced to writing. The loan was eventually paid off.

The complaint further alleged that on February 13, 1997, Mr. Moran and Mr. Hoover entered into negotiations regarding Mr. Hoover's claim for an interest in the sale proceeds of the Coal Company. Those negotiations proved fruitless. Subsequent to the alleged negotiations, on or about February 18, 1999, the Coal Company was sold to a buyer for a purported sum of $11,600,000.00.

On April 16, 2002, Mr. Hoover filed the instant action against both Mr. Moran and the Coal Company alleging a breach of the 1985 oral agreement to pay him 10% of the profits from the sale of the Coal Company. In July of 2002, a joint motion to dismiss was filed by Mr. Moran and the Coal Company.

While the joint motion to dismiss was pending, the Coal Company filed for bankruptcy in November of 2002. As a consequence of the bankruptcy filing, an automatic stay was entered on the claim against the Coal Company. On March 29, 2004, the circuit court entered a voluntary agreed order dismissing the Coal Company from the action with prejudice. Thereafter on July 15, 2005, the circuit court sua sponte entered an order under Rule 41(b) dismissing the case against Mr. Moran due to inactivity in the case for more than a year.

On May 24, 2006, Mr. Hoover filed a motion seeking to reinstate the action against Mr. Moran. Subsequent to such hearing, the circuit court entered an order on August 4, 2006, reinstating the action against Mr. Moran.

After the case was reinstated, the parties supplemented their briefs relating to the previously filed Rule 12(b)(6) motion to dismiss. Specifically, Mr. Moran argued in his supplemental brief that the complaint should be dismissed because it failed to assert a claim against him in his individual capacity and/or because, to be enforceable, the alleged agreement was required to be reduced to writing. Subsequent to the hearing, the circuit court issued an order on December 8, 2006, dismissing the case on the ground that the complaint failed to allege a cause of action against Mr. Moran in his individual capacity.¹ On December 14, 2006, Mr. Hoover filed a motion for reconsideration under Rule 59 of the West Virginia Rules of Civil Procedure.² The circuit court denied the motion by order entered December 29, 2006. This appeal was timely filed on April 16, 2007.

II. STANDARD OF REVIEW

We are called upon to consider the circuit court's dismissal of the complaint against Mr. Moran under Rule 12(b)(6). "Appellate review of a circuit court's order granting a motion to dismiss a complaint is de novo." Syl. pt. 2, State ex rel. McGraw v. Scott Runyan Pontiac-Buick, Inc., 194 W.Va. 770, 461 S.E.2d 516 (1995). We have also indicated that "[t]he trial court, in appraising the sufficiency of a complaint on a Rule 12(b)(6) motion, should not dismiss the complaint unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Syl. pt. 3, Chapman v. Kane Transfer Co., 160 W.Va. 530, 236 S.E.2d 207 (1977).³ Thus, "[t]he policy of the rule is . . . to decide cases upon their merits, and if the complaint states a claim upon which relief can be granted under any legal theory, a motion under Rule 12(b)(6) must be denied." John W. Lodge Distrib. Co., Inc. v. Texaco, Inc., 161 W.Va. 603, 605, 245 S.E.2d 157, 158-59 (1978). This Court, as well as the trial court, must construe "the factual allegations in the light most favorable to the plaintiff[]." Murphy v. Smallridge, 196 W.Va. 35, 36, 468 S.E.2d 167, 168 (1996) (citing State ex rel McGraw v. Scott Runyan Pontiac-Buick, 194 W.Va. at 775-76, 461 S.E.2d at 521-22). Further, we must "draw all reasonable inferences in favor of the plaintiff." Conrad v. ARA Szabo, 198 W.Va. 362, 369, 480 S.E.2d 801, 808 (1996).

This case also requires the Court to review Mr. Moran's cross-assignment of error, regarding the trial court's reinstatement of the case after it was dismissed under Rule 41(b). "A circuit court's ruling on a motion for reinstatement will not be reversed on appeal absent a clear showing of an abuse of discretion." Cleckley, et al., Litigation Handbook, § 41(b), at 1055. See also Syl., Snyder v. Hicks, 170 W.Va. 281, 294 S.E.2d 83 (1982) ("`A trial court, upon a motion to reinstate a suit or action, . . . is vested with a sound discretion with respect thereto. . . .' Syl. pt. 4, White Sulphur Springs, Inc. v. Jarrett, 124 W.Va. 486, 20 S.E.2d 794 (1942), in part.").

With these standards in mind, we now turn to the merits of the issues presented by this appeal.

III. DISCUSSION

A. Cause of Action Against Mr. Moran in His Individual Capacity

The first issue we must address concerns Mr. Hoover's contention that the circuit court erred in finding that his complaint did not set out a cause of action against Mr. Moran in his individual capacity. The circuit court's order stated that "the Court finds no allegations in the Complaint against Peter Moran as an individual, and therefore grants the Motion to Dismiss." The parties do not dispute that the...