Sass v. Andrew
2003 Md. App. LEXIS 116, 832 A.2d 247, 152 Md. App. 406 (2003)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A contractor's failure to complete a project does not constitute fraud if they partially performed the work, as this negates the element of a present intention not to perform. Furthermore, a claim of fraudulent concealment regarding the contractor's identity will fail if the identity was clearly stated in the contract, as the other party's failure to read the contract makes any reliance on a mistaken belief unreasonable.
Facts:
- Madonna Andrew sought to build an addition to her daughter's home and met with Stan Mell of Innerstate Design Builders.
- Cairoll Sass accompanied Mell to two meetings with Andrew, but Andrew had no direct conversation with Sass before signing a contract.
- Andrew believed she was entering into a contract with Mell and his company, Innerstate.
- On August 31, 1999, Andrew met with Mell and Sass and signed a contract that was on a form for Sass's company, 'Atlantis Painting & Decorating,' and was signed by Sass as the 'Contractor.'
- Andrew did not read the contract before signing it and only noticed Sass's name and his company's name after Mell and Sass had left her home.
- Construction began, and Sass personally performed some of the framing work. Andrew testified that the project was 'going along pretty good.'
- Andrew made a second progress payment of $7,693 to Mell, but a few days later, all work on the project stopped and the site was abandoned.
- Andrew subsequently hired other contractors to perform roofing and other work to protect and continue the project.
Procedural Posture:
- Madonna Andrew filed suit in the Circuit Court for Anne Arundel County (a state trial court) against Cairoll Sass for fraud, as well as against other parties.
- Andrew obtained default judgments against co-defendants Stan Mell and his company, Innerstate.
- The case proceeded to a jury trial against Sass and his company, Atlantis.
- During the trial, the court dismissed all claims against Atlantis because it had been improperly sued as a corporation.
- The jury found Sass liable on the sole remaining claim of fraud and awarded Andrew $28,797 in damages.
- The trial court denied Sass's post-trial motions for judgment notwithstanding the verdict and for a new trial.
- Sass, as appellant, appealed the judgment to the Court of Special Appeals of Maryland, an intermediate appellate court.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does a contractor's abandonment of a partially completed project constitute legally sufficient evidence of fraudulent inducement where the homeowner was mistaken about the contractor's identity at the time of signing, despite the contractor's name and company being clearly printed on the contract she signed without reading?
Opinions:
Majority - Hollander, J.
No. A contractor's abandonment of a project after partial performance is evidence of a breach of contract, not fraudulent inducement, and a party cannot reasonably rely on a mistaken belief about the contractor's identity when the correct identity was clearly stated on the contract that they signed without reading. The court reasoned that a fraud claim requires proof of a present intention not to perform at the time the contract is made. Here, Sass's partial performance—personally working on the framing to the point that the project was 'going along pretty good'—is inconsistent with an initial intent to defraud. His subsequent failure to complete the project is a breach of contract. Furthermore, Andrew's claim of being deceived about the contractor's identity fails because Sass made no affirmative misrepresentations. The truth was clearly written on the contract, and Andrew had a duty to read it. Her failure to do so makes her reliance on her own misunderstanding unreasonable, and she could not have been induced by something she did not discover until after signing.
Analysis:
This decision reinforces the high evidentiary bar for proving fraud and clarifies the critical distinction between a breach of contract and a fraudulent act. It establishes that partial performance by a defendant can effectively defeat a claim that a contract was entered into with a present intention not to perform. The ruling also underscores the long-standing principle that parties are under a duty to read the contracts they sign. This case limits the ability of plaintiffs to convert straightforward breach of contract claims into more severe fraud torts, thereby preventing access to potentially higher damages, unless they can provide clear evidence of deceitful intent at the moment of contract formation, rather than just a subsequent failure to perform.
