United States District Court, E.D. Virginia, Newport News Division
MARINA ONE, INC. d/b/a JOYS MARINA, ARCHIE F. ALLEN, and LINDA ALLEN, Plaintiffs,
JEAN JONES, Defendant
[Copyrighted Material Omitted]
For Marina One, Inc., doing business as Joys Marina, Archie F. Allen, Linda Allen, Plaintiffs: Danielle Marie Kruer, David Neil Ventker, Marissa Marriott Henderson, Ventker & Warman PLLC, Norfolk, VA.
For Jean Jones, Defendant: Patrick Michael Brogan, LEAD ATTORNEY, Davey & Brogan PC, Norfolk, VA.
MEMORANDUM OPINION & ORDER
Raymond A. Jackson, United States District Judge.
Before the Court is Defendant Jean Jones' Motion to Dismiss. Dkt. No. 6. Plaintiffs, who are a marina and its owners, filed a Complaint against Defendant, an owner of a boat berthed at the marina whose husband is involved in ongoing state court litigation against Plaintiffs for an injury sustained at the marina. Plaintiffs cite federal admiralty jurisdiction and allege that Defendant breached a wharfage contract. They also seek a declaration that she is obligated to indemnify Plaintiffs in the state court action under that contract and raise other state law tort claims. Defendant seeks dismissal of their Complaint on numerous grounds. For the reasons stated below, Defendant's Motion to Dismiss is DENIED IN PART AND DEFERRED IN PART. Further, Plaintiffs Archie and Linda Allen are GRANTED leave to amend the Complaint to sufficiently plead their connection to the contract and tort claims within FIFTEEN (15) DAYS of the date of entry of this Order. Defendant is ORDERED to provide notice of this suit and a copy of this Order to Mr. Jones within FIVE (5) DAYS of the date of the entry of this Order and provide certification to the Court of her compliance.
I. FACTUAL AND PROCEDURAL HISTORY
The facts alleged in the Complaint are as follows. Plaintiff Marina One, Inc. is a Virginia corporation and the lessee and operator of Joys Marina in Hampton, Virginia (" the Marina" ). Compl. ¶ 4. Plaintiffs Archie and Linda Allen own the property where the Marina is located and lease it to Marina One. Compl. ¶ 5. Defendant Jean Jones is the co-owner of a 44-foot Sea Ray vessel that was docked at the Marina. The other owner of the vessel is Defendant's husband, Rick Jones. Compl. ¶ 7. He has filed suit in state court against the Plaintiffs and alleges that in May 2012, he suffered personal injury while disembarking from their vessel at the Marina. Compl. ¶ 18.
Attached to the Complaint is a Slip Lease Agreement (" the Agreement" ) signed on June 27, 2011, and providing for the dockage of the Jones' vessel at the Marina between July 1, 2011 and June 30, 2012. Rick Jones is listed as the " Lessee," but the Agreement was signed by Defendant. Above her signature is a certification that the person signing " is the owner of the vessel hereinabove described or is authorized to subj[e]ct such vessel to the provisions of this contract." Dkt. No. 1-1 at 3. Notably, the Agreement provides that the lessee is required to obtain indemnity insurance in the amount of $300,000 and to list the Marina as an additional insured. Compl. ¶ 11. However, when Plaintiffs raised this clause as a defense in Mr. Jones' state court suit, he claimed that he was not bound by the Agreement because
Defendant was not authorized to sign the Agreement on his behalf. Compl. ¶ 19.
Plaintiffs now raise five claims against Defendant. Count 1 is a claim for declaratory relief, and alleges that Defendant had the authority to bind herself to the Agreement as the owner of the vessel. As such, she is obligated to indemnify the Marina in her husband's state court suit. Count 2 is a breach of contract claim, and alleges that Defendant breached numerous clauses of the Agreement, such as the requirement to maintain the pier in a safe condition and to defend and indemnify the Marina. Count 3 and 4 are actual and constructive fraud claims, and are raised in the alternative to Counts 1 and 2. (Count 4 is also raised in the alternative to Count 3). They allege that Defendant fraudulently misrepresented that she had the authority to sign the Agreement. Finally, Count 5, also raised in the alternative to Counts 1 and 2, alleges that Defendant breached the warranty of authority that she made to the Marina.
On October 11, 2013, Defendant filed a Motion to Dismiss on numerous grounds. On October 29, 2013, Plaintiffs filed their Opposition. On November 7, 2013, Defendant filed her Reply. The matter is accordingly fully briefed and ripe for disposition.
II. STANDARD OF REVIEW
Defendant's Motion to Dismiss is based on Federal Rule of Civil Procedure 12(b)(1) (lack of subject-matter jurisdiction), 12(b)(6) (failure to state a claim upon which relief can be granted), and 12(b)(7) (failure to join a party under Federal Rule of Civil Procedure 19). Rule 12(b)(1) provides for the dismissal of an action if the court lacks subject matter jurisdiction over a claim or the cause of action as a whole. The Court assumes that all factual allegations in the complaint are true where the opposing party contends that a complaint fails to allege facts upon which subject matter jurisdiction can be based. Adams v. Bain, 697 F.2d 1213, 1219 (4th Cir. 1982). If the factual basis for jurisdiction is challenged, the plaintiff has the burden of proving subject matter jurisdiction. Richmond, Fredericksburg & Potomac R.R. Co. v. United States, 945 F.2d 765, 768 (4th Cir. 1991). To determine whether subject matter jurisdiction exists, the reviewing court may consider evidence outside the pleadings, such as affidavits or depositions, Adams, 697 F.2d at 1219, or whatever other evidence has been submitted on the issue. GTE South Inc. v. Morrison, 957 F.Supp. 800, 803 (E.D. Va. 1997). A party moving for dismissal for lack of subject matter jurisdiction should prevail only if material jurisdictional facts are not in dispute and the moving party is entitled to prevail as matter of law. Richmond, Fredericksburg & Potomac R.R. Co., 945 F.2d at 768.
Rule 12(b)(6) provides for dismissal of actions that fail to state a claim upon which relief can be granted. See Fed.R.Civ.P. 12(b)(6). The Supreme Court has stated that in order " [t]o survive a motion to dismiss, a Complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (internal quotations omitted)). Specifically, " [a] claim has facial plausibility when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678. Moreover, at the motion to dismiss stage, the Court is bound to accept all of the factual allegations in the Complaint as true. Id. at 678. However, " [t]hreadbare recitals of the elements
of a cause of action, supported by mere conclusory statements, do not suffice." Id. at 678. Assessing the claim is a " context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679.
Rule 12(b)(7) provides for dismissal where a party has not been joined as required by Rule 19. The party asserting the Rule 12(b)(7) defense bears the burden of showing that a person not joined is necessary and indispensable pursuant to Rule 19. Am. Gen. Life & Accident Ins. Co. v. Wood, 429 F.3d 83, 92 (4th Cir. 2005). A court addressing such a defense may consider evidence presented outside of the pleadings. R-Delight Holding LLC v. Anders, 246 F.R.D. 496, 499 (D. Md. 2007).
The Court will first address Defendant's arguments that pertain to all of the claims in the Complaint, and then turn to those arguments that are specific to certain individual counts. Collectively, Defendant contends that the Court lacks subject matter jurisdiction, that the Aliens should be dismissed as plaintiffs, and that Plaintiffs have failed to join a necessary party. Individually, she contends that the breach of contract and declaratory judgment claims (Counts 1 and 2) should be dismissed for failure to state a claim, that the Court should abstain from addressing the declaratory judgment claim (Count 1) because of the ongoing state court action, and that the fraud and constructive fraud claims (Counts 3 & 4) fall outside the applicable statute of limitations and have not been pled with the requisite specificity.
A. Arguments as to all counts
1. Subject matter jurisdiction
At various points throughout the Motion to Dismiss and Reply, Defendant contends that the Court lacks subject matter jurisdiction over all of Plaintiffs' claims for various reasons. Brief in Support of Mot. to Dismiss, Dkt. No. 7 (hereinafter " Mot. to Dismiss" ), at 9, 21, 22; Reply at 2-3, 5-6. Plaintiffs respond that the Court has subject matter jurisdiction simply because there is admiralty jurisdiction over the Declaratory Judgment and Breach of Contract claims (Counts 1 and 2), and that all of the other claims are a proper ...