eNotes: Liability – June 2024 – Maryland

SIGNIFICANT CASE SUMMARIES

Maryland Case Summary

Boyd v. The Goodman-Gable Gould Co.
Maryland Appellate Court
No. 2089, September Term, 2022

Decided: March 11, 2024

Plaintiffs failed to establish damages, failed to establish that Defendant had intentionally misled them, and failed to establish that the contract between the parties was illusory.

Background

In 2016, the home of David Boyd and Penny Coco-Boyd (“Plaintiffs”) was destroyed in a fire. Plaintiffs were insured through State Farm. Plaintiffs contracted with Goodman-Gable-Gould Co. d/b/a Goodman-Gable-Gould Co./Adjusters International (“Defendant”) to adjust the claim with State Farm. Plaintiffs were concerned about a free standing gazebo and wooden deck adjacent to the home. Plaintiffs claimed that a representative of Defendant had assured them that the deck and gazebo would be fully covered under the “extended dwelling” provision in their policy. Plaintiffs demolished the gazebo and deck, claiming they relied on Defendant’s representations about coverage. State Farm denied coverage for these structures on the basis that they were not covered under the extended dwelling coverage part.

After making a complaint to the Maryland Insurance Administration, Plaintiffs filed suit in Circuit Court against Defendant, seeking $112,344. They sued for breach of contract, declaratory judgment, and restitution, among other things. After discovery, Defendant filed a Motion for summary judgment, which the Court granted on all counts. It held that Defendant owed no duty to advise the Plaintiffs regarding the extended dwelling coverage, that the contract was not illusory since it was supported by consideration, and that any claims of damages were unsupported as Plaintiffs did not designate any experts to support the claimed damages. Plaintiffs appealed.

Holding

The Appellate Court of Maryland affirmed the Circuit Court’s decision. The Plaintiffs’ breach of contract claim failed because the Plaintiffs never established their damages. While lay witnesses testified, Plaintiffs designated no experts to attest to the cost of replacing the deck. State Farm’s estimate of $112,344 was inadmissible without expert testimony. The Appellate Court agreed with the Trial Court that the question of damages concerned more than just value, but also concerned the extent of damage caused by fire, and the salvageability of the deck. The Court found that Plaintiffs were unqualified to opine on these topics as they were simply the homeowners.

Plaintiffs also failed to prove that Defendant had any duty to advise them about the scope of coverage under the extended dwelling provision. There was no negligent misrepresentation because Plaintiffs could not establish that a tort duty existed outside of the rights and obligations under the contract. There was no misrepresentation about whether the deck was covered. Moreover, the claim for restitution was properly denied because the contract between the parties was supported by sufficient consideration. Plaintiffs contract with Defendant was on a commission basis and commission was sufficient consideration in this context, such that the contract was not illusory.

Questions about this case can be directed to Lucas Duty at (443) 641-0572 or lduty@tthlaw.com.