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Perry v. H.O. Perry
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MAINE SUPREME JUDICIAL COURT					Reporter of Decisions
Decision:	1998 ME 131
Docket: 	Aro-97-726
on Briefs:	May 15, 1998
Decided:	June 2, 1998




	[¶1]  Clinton Perry, Angela Perry, and Andrew N. Grant appeal from
the summary judgment entered in the Superior Court (Aroostook County,
Pierson, J.) in favor of H.O. Perry & Son Co. (H.O. Perry) on their complaint
seeking damages for alleged negligent misrepresentations by H.O. Perry.{1} 
Grant claims that he suffered a pecuniary loss as a result of his reliance on
the advice given to him by his insurance agent, H.O. Perry, advice he claims
adversely impacted his liability insurance coverage for an accident involving
the Perrys for which he is liable.  We disagree and affirm the judgment.
	[¶2]  	This case arises from the same set of facts that this Court
considered in Maine Mutual Fire Insurance v. Grant, 674 A.2d 503 (Me.
	Andrew Grant's parents were named insureds and Andrew
was listed as an additional "operator" in an umbrella liability
policy issued to the Grants by H.O. Perry & Son Company (H.O.
Perry) acting as an agent for Maine Mutual.  When, in July 1992,
Andrew Grant purchased a 1991 Ford Bronco, he contacted H.O.
Perry seeking automobile liability insurance under his father's
insurance policy.  H.O. Perry's representative told Andrew that to
insure the Bronco under his father's policy Andrew should
register the Bronco jointly in both his name and his father's
name.  Andrew complied with this advice, and the Bronco was
added to an automobile liability policy issued by Commercial
Union Insurance Company to Norman Grant.                                              
	In November 1992, Andrew, while driving his Ford
Bronco, was involved in an automobile accident in which the
Perrys were injured.  
Id. at 503-05. 

	[¶3]  Andrew Grant was convicted on a plea of nolo contendere to the
charge of operating under the influence of intoxicants as a result of this
accident.  Commercial Union accepted coverage pursuant to Andrew's
automobile liability policy; Maine Mutual denied coverage under Andrew's
parents' umbrella policy because Andrew's vehicle was not owned by a
named insured and was not being driven by a named insured at the time of
the accident.  Maine Mutual's coverage position was confirmed when the
Superior Court entered a declaratory judgment in favor of Maine Mutual
against Andrew Grant and the Perrys, establishing that Andrew Grant was
not an insured under his father's umbrella policy, which judgment we
affirmed.  Id.
	[¶4]  Andrew and the Perrys then brought the present action for
negligent misrepresentation against H.O. Perry.  A summary judgment was
granted in favor of H.O. Perry.  This appeal followed.  Both parties agree that
Andrew, when he sought to be added as an insured under his father's
automobile liability policy, did not ask H.O. Perry's representative about
obtaining personal liability umbrella coverage for himself, nor was such
coverage mentioned to Grant by H.O. Perry.
	[¶5]  In Chapman v. Rideout, 568 A.2d 829 (Me. 1990), we adopted
section 552 of the Restatement (Second) of Torts as the appropriate
standard for negligent misrepresentation claims.  Section 552 provides:
One who, in the course of his business, profession or
employment, or in any other transaction in which he has a
pecuniary interest, supplies false information for the guidance of
others in their business transactions, is subject to liability for
pecuniary loss caused to them by their justifiable reliance upon
the information, if he fails to exercise reasonable care or       
competence in obtaining or communicating the information.
Restatement (Second) of Torts § 552(1) (1977).  For a party to be liable for
its negligent misrepresentation, another party must have, inter alia, relied
upon the false representation to its pecuniary detriment.
	[¶6]  A dispositive issue in this case is whether Andrew Grant is
collaterally estopped from relitigating the issue of whether he detrimentally
relied on statements made by H.O. Perry concerning insurance coverage. 
Collateral estoppel prevents the relitigation of factual issues already decided
if "the identical issue was determined by a prior final judgment, and . . . the
party estopped had a fair opportunity and incentive to litigate the issue in a
prior proceeding."  Van Houten v. Harco Constr., Inc., 655 A.2d 331, 333
(Me. 1995) (citation and quotation omitted).  The alleged misrepresentation
forming the basis of Grant's claim in Maine Mutual v. Grant was H.O. Perry's
alleged instruction to Andrew to register jointly his Bronco in order to
secure umbrella and auto liability insurance.  One element to Andrew's claim
in Maine Mutual v. Grant was "justifiable and detrimental reliance by
[Andrew] on [H.O. Perry's] conduct"  Id. at 504.  The trial court concluded in
Maine Mutual v. Grant, however, and we affirmed, that "[t]he record is
devoid of any evidence that Andrew Grant took any action or failed to take
any action in reliance on anything done or said by employees of H.O. Perry
acting as agents for Maine Mutual."  Id. at 505.  Because Andrew had both
the opportunity and incentive in Maine Mutual v. Grant to litigate the issue
of whether he detrimentally relied on statements made by H.O. Perry when
he sought insurance coverage, Andrew is now collaterally estopped from
relitigating this factual issue in the present case.
	[¶7]  Andrew, attempting to avoid collateral estoppel on the issue of
whether he took any action in reliance on representations made to him by
H.O. Perry acting as an agent for Maine Mutual, now argues that he relied to
his detriment on alleged misrepresentations made to him by H.O. Perry
acting as an agent for Commercial Union.  Agency is the fiduciary
relationship "which results from the manifestation of consent by one person
to another that the other shall act on his behalf and subject to his control,
and consent by the other so to act."  Defosses v. Notis, 333 A.2d 83, 86 (Me.
1975).  Andrew Grant's contention that H.O. Perry was acting as an agent for
Commercial Union, as opposed to Maine Mutual, when it discussed
insurance coverage with him draws a distinction without consequence. 
Whether H.O. Perry was acting as an agent for Maine Mutual or for
Commercial Union is not relevant to the factual issue of whether Andrew
detrimentally relied upon representations made to him by H.O. Perry.  
	[¶8]  Andrew and the Perrys are bound by the factual determination
made in Maine Mutual v. Grant that Grant did not detrimentally rely on
statements made by H.O. Perry.  Because a showing of detrimental reliance is
essential to an action for negligent misrepresentation, a summary judgment
was properly entered in H.O. Perry's favor.  See Jacques v. Pioneer Plastics,
Inc., 676 A.2d 504, 506 (Me. 1996) ("A summary judgment is proper when
the party that bears the burden of proof of an essential element at trial has
presented evidence that, if it presented no more, would entitle the
opposing party to a judgment as a matter of law.").
		The entry is:
					Judgment affirmed.
Attorneys for plaintiffs: Christopher M. Leger, Esq. Peter S. Kelley, Esq. Kelley Law Offices P O Box 66 Caribou, ME 04736 Attorneys for defendant: John S. Lucy, Esq. Wendell G. Large, Esq. Richardson, Whitman, Large & Badger, P.C. P O Box 2429 Bangor, ME 04402-2429
FOOTNOTES******************************** {1} The Perrys are parties-in-interest. Andrew Grant assigned to them the right, inter alia, to pursue this action against H.O. Perry in exchange for their promise not to proceed against Andrew personally. For the purpose of this opinion, we assume the validity of the assignment. {2} The evidentiary record before the Superior Court in the instant case was identical to the record before this Court in Maine Mutual Fire Insurance v. Grant, hereinafter referred to as Maine Mutual v. Grant.