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Contracts — Breach of duty — Loyalty and care

The saga of the tangled litigation underlying the current appeal began in 2006 when LaJuan Martin (“Appellant”) and Freddie Winston (“Appellee”) formed Winston Martin Holding Group, LLC (“WMHG”) to develop a restaurant on a parcel of real property in Prince George’s County (the “Property”) that they purchased for $900,000. That company has been defunct since 2011 when Inglewood Restaurant Park Association (“Inglewood”) foreclosed on the Property to recover a lien for $30,000 based on association assessments that WMHG failed to pay. Winston, in his individual capacity, then bought the Property at a foreclosure sale. The Circuit Court for Prince George’s County, in an order issued by the Honorable Thomas P. Smith on January 16, 2014, ratified the foreclosure sale over exceptions that Martin (individually) filed as an intervenor. Martin’s appeal of that order (the “Inglewood action”) was eventually dismissed for failure to post a supersedeas bond. Inglewood issued Winston the deed to the Property in fee simple on May 14, 2014. Martin then instituted the underlying action against Winston in the Circuit Court for Prince George’s County on October 29, 2014, asserting that Winston breached duties owed as a member of WMHG. The circuit court dismissed his claims, deciding that they were barred by res judicata based on his participation in the Inglewood action. This Court, in a 2016 opinion authored by the Honorable Glenn T. Harrell, reversed and remanded, ruling that Martin’s personal claims against Winston were not barred by res judicata because they were not claims that could have been brought in the Inglewood action. Martin v. Winston, No. 915, September Term, 2015 (filed on August 11, 2016) (unreported) (“Martin I”).

On remand, Martin filed a second amended complaint in the underlying action on behalf of himself and WMHG. Prior to trial, the circuit court granted Winston’s motion to dismiss WMHG from the complaint because the LLC has been defunct since 2011 and was not represented by counsel as required by Maryland law.1 The court granted summary judgment in Winston’s favor on two other claims, and the case proceeded to trial from November 28 to 29, 2017, on two claims: (1) a breach of duty of loyalty and care and (2) fraud/misrepresentation. At the close of the plaintiff’s case, the circuit court granted Winston’s motion for judgment on both remaining counts and awarded fees to Winston because, the court ruled, Martin lacked substantial justification to bring his claims. Martin’s appeal from that judgment presents five questions for our review: I. “Whether the trial court erred in sustaining the objection of the Appellee that Appellants failed to satisfy the notice of a foreign law requirement under Judicial Proceedings Article § 10-504?” II. “Whether the trial court erred in ruling that Appellants, individually as trustee and member of WMHG, was precluded from asserting claims on behalf of WMHG?” III. “Whether the trial court erred in ruling that Appellants had not established fraud?” IV. “Whether the trial court erred in sustaining the objection of Appellee that the amended order to docket foreclosure in CAE11-02632 was not relevant to proving counts 2 and 3 of the complaint?” V. “Whether the trial court erred in finding Appellants’ lawsuit frivolous and imposing attorney’s fees in the amount of $22,862.50?” Seeing …

Read the opinion.