1600 Barberry Lane 8 LLC v. Cottonwood Residential

2019 UT App 146
THE UTAH COURT OF APPEALS
1600 BARBERRY LANE 8 LLC AND 1600 BARBERRY LANE 9 LLC,
Appellants,
v.
C OTTONWOOD R ESIDENTIAL OP LP, C OTTONWOOD C APITAL
PROPERTY M ANAGEMENT II LLC, C OTTONWOOD C APITAL PROPERTY
M ANAGEMENT I NC ., AND DANIEL S HAEFFER ,
Appellees.
Opinion
No. 20180105-CA
Filed August 22, 2019
Third District Court, Salt Lake Department
The Honorable Robert P. Faust
No. 170904221
Kenneth J. Catanzarite and Andrew G. Deiss,
Attorneys for Appellants
Matthew L. Lalli, Michael A. Gehret, W. Danny
Green, and Henry H. Oh, Attorneys for Appellees
JUDGE DIANA H AGEN authored this Opinion, in which
JUDGES DAVID N. M ORTENSEN and JILL M. POHLMAN concurred.
HAGEN, Judge:
¶1 	Plaintiffs 1600 Barberry Lane 8 LLC and 1600 Barberry
Lane 9 LLC (the Owners), two tenant-in-common owners of an
apartment complex in Georgia (the Property), appeal the district
court’s dismissal of their amended complaint. The Owners sued
Cottonwood Residential OP LP, Cottonwood Capital Property
Management II LLC, Cottonwood Capital Property Management
Inc., and Daniel Shaeffer (collectively, Cottonwood) for breach of
fiduciary duty or aiding and abetting breach of fiduciary duty
and breach of contract or tortious interference with a contract.

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The Owners’ claims arise out of the property management
agreement (the Agreement) between the 	Owners and Todd
Mikles 	and 	Daymark 	Residential 	and 	Asset 	Management
(collectively, Daymark),1 who contracted to provide property
and asset management services for the Property. The Owners
assert 	that 	Cottonwood 	breached 	the 	Agreement 	and 	its
fiduciary duty to the Owners by charging fees that exceeded
market rates for property and asset management services or,
alternatively, that Cottonwood induced or aided and abetted
Daymark in doing so. We conclude that the Owners have not
stated 	a 	claim 	for 	breach 	of 	fiduciary 	duty 	because 	the
Agreement does not give rise to a fiduciary duty on behalf of
either Daymark or Cottonwood with respect to the fees they
charged 	for 	their 	services. 	And 	because 	the 	Agreement
contained no provision limiting management fees to market
value, 	we 	conclude 	that 	neither 	Cottonwood 	nor 	Daymark
breached 	the 	Agreement 	by 	charging 	fees 	that 	allegedly
exceeded market rate. Accordingly, we affirm the district court’s
dismissal of the amended complaint for failure to state a claim
upon which relief could be granted.
BACKGROUND2
¶2 	In 2008, the Owners each acquired a 1.478% interest in the
Property, which was a “312 unit garden apartment community”
1. The property manager listed in the Agreement was Grubb
& Ellis Company, which later became Daymark. The Owners
have filed suit against Daymark in another court, but Daymark
was not named as a defendant in this action and is not a party.
2. “On appeal from a motion to dismiss, we review the facts as
they are alleged in the complaint.” Ho v. Jim’s Enters., Inc., 2001
UT 63, ¶ 2, 29 P.3d 633.

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located in a suburb of Atlanta, Georgia. At that time, the Owners
entered into the Agreement with Daymark for property and
asset 	management 	services 	relating 	to 	the 	Property. 	The
Agreement contained a choice of law provision stating that any
disputes arising under the Agreement would be governed by
Georgia law.3 In relevant part, the Agreement provided:
2.1 Status of Property Manager. The [Owners] and
[Daymark] do not intend to form a joint venture,
partnership or similar relationship. 	Instead, the
parties intend that [Daymark] shall act solely in the
capacity 	of 	an 	independent 	contractor 	for 	[the
Owners]. Nothing in [the] Agreement shall cause
[Daymark] and [the Owners] to be joint venturers
or partners of each other, and neither shall have the
power to or obligate the other party by virtue of
[the] Agreement, except as expressly provided in
this Agreement. Nothing in [the] Agreement shall
deprive or otherwise affect the right of either party
to own, invest in, manage, or operate, or to conduct
business 	activities 	which 	compete 	with, 	the
Property. . . .
2.2 Management. [Daymark] shall be the sole and
exclusive manager of the Property to act on behalf
of [the Owners] and shall manage, operate and
maintain the Property in an efficient, economic,
and 	satisfactory 	manner 	and 	shall 	manage 	the
3. The parties agree that under the Agreement’s choice of law
provision, Georgia law governs the substance of the Owners’
claims. While we apply Georgia law “to the substantive issues
presented 	in 	this 	case, 	we 	still 	follow 	our 	own 	rules 	of
procedure.” Waddoups v. Amalgamated Sugar Co., 2002 UT 69,
¶ 20, 54 P.3d 1054.

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20180105-CA 	4 	2019 UT App 146
performance of everything reasonably necessary
for the proper operation of the Property for the
tenants thereof . . . [Daymark] shall perform all
services in a diligent and professional manner . . . .
. . . .
2.14 Right to Subcontract Property Management
Functions. [Daymark] reserves the right, in its sole
discretion, 	to 	subcontract 	some 	or 	all 	of 	the
property management functions described herein
to 	local 	property 	managers 	and 	certain 	other
parties. However, except as expressly provided
herein, the fees to be paid to [Daymark] under [the]
Agreement are inclusive of fees payable to such
third parties . . . .
. . . .
9.1 Property Management Fee. [Daymark], or an
affiliate, shall receive, for its services in managing
the Property in accordance with the terms of [the]
Agreement, a monthly management fee . . . and a
monthly asset management fee . . . . The Property
Management Fee shall be up to three percent (3%)
of Gross Revenues . . . and the Asset Management
Fee shall be up to two percent (2%) of Gross
Revenues . . . . The Property Management Fee is set
forth 	in 	the 	annual 	Budget 	approved 	by 	[the
Owners] in accordance with Section 2.5 hereof . . . .
. . . .
11. Conflicts. [Daymark] shall not deal with or
engage, or purchase goods or services from, any
subsidiary or affiliated company of [Daymark] in

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connection with the management of the Property
for amounts above market rates . . . .
. . . .
13.1 Assignment. [Daymark] may not assign [the]
Agreement without the prior written consent of
each 	of 	[the 	Owners] 	which 	consent 	may 	be
withheld in each [of the Owner’s] sole and absolute
discretion . . . .
Section 2.5 also provided that Daymark would prepare and
submit to the Owners “an initial capital and operating budget . . .
for the promotion, operation, leasing . . . , repair, maintenance
and improvement of the Property” for each calendar year, which
the majority of the Owners must approve.
¶3 	In October 2012, Daymark announced that it had decided
to focus its efforts on its commercial-office-property portfolio
and recommended to the Owners that Cottonwood take over
management 	services 	for 	the 	Property. 	The 	Owners
“acquiesced” and allowed Cottonwood to assume the role of
asset and property manager for the Property. But they allege that
they would not have consented to this change if Daymark had
disclosed that the Agreement’s asset and property manager fees
exceeded the fair market rate for the services. The Owners allege
that 	the 	excessively 	high 	fees 	accounted 	for 	Cottonwood’s
willingness to purchase the Agreement from Daymark for $8
million.4
4. The Owners allege that Daymark sold the Agreement to
Cottonwood and that Cottonwood thereby “subsumed from
[Daymark] all of their obligations in the [Agreement].” In ruling
on the motion to dismiss, the district court considered the
(continued…)

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20180105-CA 	6 	2019 UT App 146
¶4 	In 	June 	2017, 	the 	Owners 	filed 	a 	complaint 	against
Cottonwood, alleging that Cottonwood had breached a fiduciary
duty it owed to the Owners or, in the alternative, aided and
abetted Daymark in the breach of its fiduciary duty. Specifically,
the Owners alleged that Daymark had a fiduciary duty to
disclose that transferring the Agreement to Cottonwood was not
in 	the 	Owners’ 	best 	interests 	because 	it 	would 	allow
Cottonwood 	to 	continue 	collecting 	above-market 	fees. 	The
complaint alleged that Cottonwood both aided and abetted
Daymark’s breach and was “directly liable . . . as the successor
fiduciary” to Daymark for failing to disclose facts that would
have 	led 	the 	Owners 	to 	discover 	that 	they 	were 	being
overcharged.
¶5 	Under rule 12(b)(6) of the Utah Rules of Civil Procedure,
Cottonwood moved to dismiss the Owners’ action for failure to
state a claim upon which relief can be granted, to which the
Owners responded by filing an amended complaint. In their
amended complaint, the Owners again asserted their fiduciary
duty claim and added two alternative claims: breach of contract
and interference with contract. In their breach of contract claim,
(…continued)
contract between Daymark and Cottonwood, which the Owners
did not attach to or expressly reference in their pleading, and
concluded 	that 	Daymark 	did 	not 	assign 	the 	Agreement 	to
Cottonwood but rather engaged Cottonwood as a subcontractor.
The Owners allege that the district court improperly considered
the 	contract 	between 	Daymark 	and 	Cottonwood 	without
converting the motion to dismiss to one for summary judgment.
See Utah R. Civ. P. 12(b). We need not decide whether this was
error, because we affirm the district court without regard to the
contract between Daymark and Cottonwood. In other words,
our analysis does not depend on whether Cottonwood was an
assignee of or a subcontractor under the Agreement.

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the Owners alleged that the fees under the Agreement “were
capped at the lesser of market value for the actual services
provided or for the maximum listed fee” and that Cottonwood
breached 	the 	Agreement 	by 	“charging 	and 	continuing 	to
overcharge[] asset and property management fees in excess of
fair value.” Alternatively, the Owners alleged that, by paying
Daymark 	$8 	million 	in 	“exchange 	for 	all 	future 	property
management and asset management fees at rates in excess of fair
value,” Cottonwood “improperly induced” Daymark to breach
the provisions of the Agreement that allegedly capped fees “at
the lesser of market value or the maximum listed fee.”
¶6 	In 	response 	to 	the 	Owners’ 	amended 	complaint,
Cottonwood filed another motion to dismiss for failure to state a
claim. The Owners opposed that motion, and the district court
heard argument on it. At argument, Cottonwood contended that,
as a matter of Georgia law, a property manager does not “owe a
fiduciary duty to forego enjoying the benefits of the bargain that
the 	parties 	struck 	in 	a 	written 	property 	management
agreement.” Because the Owners had not alleged that Daymark
and Cottonwood charged more than the negotiated fees set forth
in the Agreement, Cottonwood also argued that the Owners’
allegations did not amount to either a breach of contract or a
breach of fiduciary duty.
¶7 	The 	district 	court 	granted 	Cottonwood’s 	motion 	to
dismiss on a number of alternative grounds. In granting the
motion, the district court determined, among other things, that
Cottonwood did not owe the Owners a fiduciary duty, because
the 	Agreement 	between 	the 	parties 	did 	not 	give 	rise 	to 	a
confidential relationship under Georgia law. The district court
also ruled that the Owners could not state a claim for breach of
contract 	or 	interference 	with 	contract 	based 	on 	the 	alleged
practice of charging above-market rates, because nothing in the
Agreement limited the property and asset management fees to
market rate. The Owners appeal.

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20180105-CA 	8 	2019 UT App 146
ISSUE AND STANDARD OF REVIEW
¶8 	The 	Owners 	contend 	that 	the 	district 	court 	erred 	in
granting 	Cottonwood’s motion 	to 	dismiss, 	arguing 	that 	the
amended complaint contained sufficient allegations to sustain
claims of breach of contract, tortious interference with a contract,
and breach of and aiding and abetting the breach of fiduciary
duty.5 “We review a decision granting a motion to dismiss for
correctness, granting no deference to the decision of the district
court,” Bylsma v. R.C. Willey, 2017 UT 85, ¶ 10, 416 P.3d 595
(quotation simplified), and “likewise review the district court’s
subsidiary legal determinations for correctness,” Fehr v. Stockton,
2018 UT App 136, ¶ 8, 427 P.3d 1190.
5. The Owners include two other issues in their statement of the
issues on appeal. Their second issue—whether the district court
erred in denying the Owners’ motion for leave to amend the
complaint a second time—is mentioned only in the statement of
issues on appeal. The issue is never mentioned again in the
Owners’ opening brief and accordingly, we do not reach it. See
Utah Physicians for a Healthy Env’t v. Executive Dir. of the Utah
Dep’t of Env’tl Quality, 2016 UT 49, ¶ 27, 391 P.3d 148 (“A party
may not dump the burden of argument and research on the
appellate court.” (quotation simplified)) The Owners’ third issue
is 	whether 	the 	district 	court 	erred 	in 	failing 	to 	convert
Cottonwood’s motion to dismiss into a motion for summary
judgment because the court considered material outside the
pleadings. As mentioned, supra note 4, it is unnecessary to reach
that issue because we affirm solely on the basis of the complaint
and the documents attached to the complaint. See Oakwood
Village LLC v. Albertsons, Inc., 2004 UT 101, ¶ 12, 104 P.3d 1226
(“If a court does not exclude material outside the pleadings and
fails to convert a rule 12(b)(6) motion to one for summary
judgment, it is reversible error unless the dismissal can be
justified without considering the outside documents.”).

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ANALYSIS
¶9 	When reviewing a dismissal under rule 12(b)(6) of the
Utah Rules of Civil Procedure, “our inquiry is concerned solely
with the sufficiency of the pleadings, and not the underlying
merits of the case.” Oakwood Village LLC v. Albertsons, Inc., 2004
UT 101, ¶ 8, 104 P.3d 1226 (quotation simplified). “A Rule
12(b)(6) 	motion 	to 	dismiss 	admits 	the 	facts 	alleged 	in 	the
complaint but challenges the plaintiff’s right to relief based on
those facts.” Id. (quotation simplified). Accordingly, “we accept
the plaintiff’s description of facts alleged in the complaint to be
true, but we need not accept extrinsic facts not pleaded nor need
we accept legal conclusions in contradiction of the pleaded
facts.” America West Bank Members, LC v. State, 2014 UT 49, ¶ 7,
342 P.3d 224 (quotation simplified). To survive a rule 12(b)(6)
motion, a complaint must “allege sufficient facts . . . to satisfy
each element” of every claim. Id. ¶ 15 (quotation simplified).
¶10 	The Owners maintain that they sufficiently pleaded facts
supporting claims of breach of fiduciary duty or aiding and
abetting a breach of fiduciary duty, breach of contract, and
tortious 	interference 	with 	a 	contract. 	We affirm 	the 	court’s
dismissal of all three claims on the following grounds: (1) the
Owners failed to state a claim for breach of fiduciary duty
because the Agreement did not create a fiduciary duty with
respect to fees; and (2) the Owners failed to state a claim for
either breach of contract or tortious interference with a contract
because the allegation that Cottonwood and Daymark charged
above-market rates, if true, would not constitute a breach of the
Agreement.
I. Fiduciary Duty
¶11 	The 	Owners 	argue 	that 	Cottonwood 	breached 	its
fiduciary 	duty 	to 	the 	Owners 	by 	charging 	above-market
property and asset management fees without disclosing that

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20180105-CA 	10 	2019 UT App 146
those fees were above market value. The Owners further allege
that Cottonwood aided and abetted Daymark’s breach of the
same fiduciary duty by paying Daymark $8 million in exchange
for allowing Cottonwood to perform the services for the same
fees under the Agreement. However, because the Agreement
does not create a fiduciary duty with respect to fees, the Owners
have failed to state a claim under either theory.
¶12 	Under Georgia law, to state a claim for breach of fiduciary
duty, 	the 	Owners 	must 	allege 	facts 	that 	demonstrate 	“the
existence 	of 	a 	fiduciary 	duty,” 	“breach 	of 	that 	duty,” 	and
damages. Ansley Marine Constr., Inc. v. Swanberg, 660 S.E.2d 6, 9
(Ga. Ct. App. 2008) (quotation simplified). To state a claim for
aiding and abetting breach of fiduciary duty, the Owners must
allege facts that demonstrate Cottonwood, “through improper
action or wrongful conduct and without privilege,” purposely,
with malice, with the intent to injure, and “with the knowledge
that [Daymark] owed [the Owners] a fiduciary duty” acted to
procure a breach of Daymark’s fiduciary duty to the Owners,
and that Cottonwood’s actions “procured” Daymark’s breach,
resulting in damages. See Insight Tech., Inc. v. FreightCheck, LLC,
633 S.E.2d 373, 379 (Ga. Ct. App. 2006). Importantly, under either
theory, the existence of a fiduciary duty is a necessary element of
the claim.
¶13 	Fiduciary 	duties 	arise 	from 	confidential 	relationships,
including those created by contract. See Douglas v. Bigley, 628
S.E.2d 199, 204 (Ga. Ct. App. 2006). By statute, Georgia defines
confidential relationships as follows:
Any 	relationship 	shall 	be 	deemed 	confidential,
whether arising from nature, created by law, or
resulting from contracts, where one party is so
situated as to exercise a controlling influence over
the will, conduct, and interest of another or where,
from a similar relationship of mutual confidence,

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20180105-CA 	11 	2019 UT App 146
the law requires the utmost good faith, such as the
relationship between partners, principal and agent,
etc.
Ga. Code Ann. § 23-2-58 (LexisNexis 2019). “The mere fact that
one reposes trust and confidence in another does not create a
confidential relationship . . . and the burden is upon the party
asserting the existence of such relationship to affirmatively show
the same.” Allen v. Hub Cap Heaven, Inc., 484 S.E.2d 259, 264 (Ga.
Ct. App. 1997) (quotation simplified); see also Parello v. Maio, 494
S.E.2d 331, 333 (Ga. 1998) (noting that “the mere circumstance
that two people have come to repose a certain amount of trust
and confidence in each other as the result of business dealings is
not, 	in 	and 	of 	itself, 	sufficient 	to 	find 	the 	existence 	of 	a
confidential relationship”).
¶14 	Georgia law recognizes that “most business relationships
are not generally confidential or fiduciary relationships.” Newitt
v. First Union Nat’l Bank, 607 S.E.2d 188, 196 (Ga. Ct. App. 2004).
“Where parties are engaged in a transaction to further their own
separate business objectives, there is no duty to represent or
advance the other’s interests.” Id.
¶15 	In 	this 	case, 	the 	Owners 	rely 	exclusively 	on 	the
Agreement as the basis of the fiduciary duty. In the amended
complaint, the Owners allege that the property manager was a
fiduciary 	because 	it 	“was 	obligated 	to 	perform 	asset
management and real estate property management services” for
the Owners’ benefit. The Owners further allege that “having
subsumed the fiduciary duties of property and asset manager”
under 	the 	Agreement, 	Cottonwood 	became 	the 	“successor
fiduciary.” Thus, the Owners rely on the contractual relationship
between the parties as the basis for the fiduciary duty.
¶16 	The Agreement authorizes the property manager to act on
behalf of the Owners to “manage, operate and maintain the

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Property in an efficient, economic and satisfactory manner.” But
an agent is only a fiduciary with respect to the matters within
the scope of its agency. See American Mgmt. Services East, LLC. v.
Fort Benning Family Communities, LLC, 774 S.E.2d 233, 249 (Ga.
Ct. App. 2015) (applying Virginia law). Even assuming that the
property managers owed the Owners fiduciary duties when
performing 	management 	services, 	the 	Agreement 	does 	not
impose an obligation on the property manager to act on the
Owners’ behalf in setting the fees for its services.
¶17 	The Agreement requires the property manager to act on
behalf of the Owners in performing its management duties, but
makes clear that the property manager is not acting as the
Owners’ agent in all respects. The Agreement expressly states
that 	the 	parties 	“do 	not 	intend 	to 	form 	a 	joint 	venture,
partnership, 	or 	similar 	relationship” 	and 	that 	the 	property
managers “shall act solely in the capacity of an independent
contractor.” 	Georgia 	courts 	have 	held 	that 	no 	confidential
relationship 	exists 	where, 	as 	here, 	the 	“contract 	expressly
provided for an independent contractor relationship” and “the
parties were engaged in a transaction with each other in an effort
to further their own separate business objectives.” Allen, 484
S.E.2d at 264; see also Automated Sol. Enters., Inc. v. Clearview
Software, Inc., 567 S.E.2d 335, 338 (Ga. Ct. App. 2002) (holding
that the relationship between the parties was not confidential but
was “merely a business relationship between two independent
concerns” where the contract provided that the plaintiff was an
independent contractor and disclaimed any intent to form a
partnership 	or 	joint 	venture). 	In 	setting 	the 	amount 	to 	be
charged for the property manager’s services, the parties were
engaged in an ordinary business transaction in which both sides
were representing their own interests. See Morrell v. Wellstar
Health System, Inc., 633 S.E.2d 68, 74 (Ga. Ct. App. 2006) (holding
that “[w]hen nonprofit hospitals and their patients enter into
agreements on the price to be charged for medical care, they are

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20180105-CA 	13 	2019 UT App 146
ordinarily engaged in business transactions indistinguishable
from 	those 	engaged 	in 	by 	for-profit 	corporations 	with 	no
confidential or fiduciary relationship between the parties”).
¶18 	In fact, the Agreement specifically provides a mechanism
for each party to look out for its own best interests with respect
to fees. Instead of granting the property manager unfettered
discretion to set the total fees up to the 3% cap, the Agreement
requires that the property manager set forth its management fees
in a yearly budget that is subject to approval by the Owners. In
other 	words, 	the 	Agreement 	does 	not 	place 	the 	property
manager in a position “to exercise a controlling influence over
the will, conduct, and interest” of the Owners or in “a similar
relationship of mutual confidence” with respect to the fees
charged for management services. See Ga. Code Ann. § 23-2-58
(2019). Discretionary control over the amount of management
fees did not lie with the property manager but with the Owners.
Because the property manager did not exercise a controlling
influence or hold a similar relationship of mutual confidence
with respect to setting fees, it had no obligation to act in the
Owners’ best interests when charging for its services.
¶19 	In sum, based on the Agreement, neither Daymark nor
Cottonwood owed the Owners a fiduciary duty with respect to
fees charged for their services. Because the Agreement is the
only basis alleged for the existence of a fiduciary duty, the
amended complaint fails to state a claim for either breach of
fiduciary duty or aiding and abetting such a breach.
II. Breach of the Agreement
¶20 	The Owners also allege that Cottonwood breached the
Agreement 	by 	charging 	above-market 	property 	and 	asset
management fees or, in the alternative, “improperly induced
[Daymark] to breach its obligation” under the Agreement by
paying Daymark $8 million in “exchange for all future property

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management and asset management fees at rates in excess of fair
value.” The district court determined that, even assuming that
Cottonwood was a party to the Agreement between the Owners
and Daymark, the facts alleged in the amended complaint could
not 	establish 	breach 	of 	contract 	by 	either 	Cottonwood 	or
Daymark 	because 	the 	Agreement 	contained 	no 	provision
limiting management fees to market value rates. We need not
first 	determine 	whether 	Cottonwood 	is 	a 	party 	to 	the
Agreement, because we agree with the district court that the
Owners 	have 	failed 	to 	allege 	a 	breach 	of 	the 	Agreement
regardless of the parties’ legal relationships.
¶21 	To state a claim for either breach of contract or tortious
interference with a contract, a party must have sufficiently
alleged a breach of a contractual obligation. See Reindel v. Mobile
Content Network Co., 652 F.Supp.2d 1278, 1287 (N.D.Ga. 2009)
(explaining that, in order “[t]o establish a breach of contract
claim, a plaintiff must show (1) an enforceable agreement, (2)
breach of that agreement, and (3) damages as a result of that
breach”); White v. Shamrock Bldg. Sys., Inc., 669 S.E.2d 168, 174
(Ga. Ct. App. 2008) (explaining that, to succeed in a tortious
interference 	claim, 	the 	plaintiff 	must 	show 	the 	defendants,
“without 	privilege, 	acted 	improperly, 	purposely, 	and 	with
malice with the intent to injure” and “that they induced a breach
of a contractual obligation”). Here, both claims fail because the
facts alleged in the amended complaint cannot establish a breach
of the Agreement.
¶22 	The 	Owners 	allege 	that 	Daymark 	and 	Cottonwood
charged above-market property and asset management fees and
that 	such 	fees 	were 	prohibited 	under 	the 	Agreement. 	The
Owners argue that when read together, the terms of sections 9.1
and 2.2 of the Agreement preclude Daymark and Cottonwood
from charging fees that exceeded the market value for property
and asset management. “An issue of contract construction is at
the outset a question of law for the court.” Grier v. Brogdon, 505

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20180105-CA 	15 	2019 UT App 146
S.E.2d 512, 514 (Ga. Ct. App. 1998). Under Georgia law, contracts
must be construed in accordance with the intention of the
parties. Ga. Code Ann. § 13-2-3 (2019). To ascertain the intention
of the parties, we first “look to the four corners of the instrument
to determine the meaning of the agreement from the language
employed.” Barrow County Airport Auth. v. Romanair, Inc., 563
S.E.2d 467, 470 (Ga. Ct. App. 2002). “If the terms used are clear
and unambiguous they are to be taken and understood in their
plain, ordinary, and popular sense.” Race, Inc. v. Wade Leasing,
Inc., 411 S.E.2d 56, 57 (Ga. Ct. App. 1991) (quotation simplified).
¶23 	Looking at the four corners of the Agreement, there is no
provision limiting the property and asset management fees to
“market value.” Section 9.1 of the Agreement provides: “The
Property Management Fee shall be up to three percent (3%) of
Gross Revenues . . . and the Asset Management Fee shall be up
to two percent (2%) of Gross Revenues.” Although this provision
clearly limits the property and asset management fees to 3% and
2% of gross revenues, respectively, the limits are not tied to
market value and the Owners have not alleged that the fees
charged exceeded the stated limits. Section 9.1 also requires that
the fees be set forth in the annual budget the property manager
submits to the Owners for approval, but there is no allegation
that Daymark or Cottonwood failed to disclose the fee amounts
in the budget or that the Owners rejected the proposed amounts.
¶24 	The Owners also rely on section 2.2 of the Agreement,
which 	provides 	that 	the 	property 	manager 	“shall 	manage,
operate and maintain the Property in an efficient, economic, and
satisfactory 	manner 	and 	shall 	manage 	the 	performance 	of
everything reasonably necessary for the proper operation of the
Property for the tenants thereof . . . [and] shall perform all
services 	in 	a 	diligent 	and 	professional 	manner.” 	But 	this
provision speaks to the property manager’s duties in performing
the contracted services, not to the amount that it can charge for
those services.

1600 Barberry Lane 8 LLC v. Cottonwood Residential OP LP
20180105-CA 	16 	2019 UT App 146
¶25 	The Agreement contains only a single provision linked to
market value. Section 11 provides that the property manager
“shall not deal with or engage, or purchase goods or services
from, any subsidiary or affiliated company of Property Manager
in connection with the management of the Property for amounts
above market rates.” This provision plainly limits the cost of
additional items and services that the property manager can
purchase on behalf of the Owners from its own subsidiary or
affiliate companies in the course of managing the Property, not
what the Owners are obligated to pay the property manager for
its management of the Property. Further, the parties’ use of
“market rate” in section 9.1 demonstrates that they knew how to
impose a market value limit when that was their intention; the
absence of similar language in section 2.2 thus supports the
conclusion that the parties did not intend to impose a market
value limit on fees. See, e.g., Skolnick v. Exodus Healthcare Network,
PLLC, 2018 UT App 209, ¶ 21, 437 P.3d 584 (recognizing that the
conditional 	language 	used 	in 	one 	contractual 	provision
“demonstrates 	that 	the 	parties 	knew 	how 	to 	make 	specific
obligations . . . conditional when that was their intent”).
¶26 	In sum, the only contractual limitations on property and
asset management fees are the 3% and 2% of gross revenue
maximums and the requirement that the fees be set forth in the
annual 	budget 	submitted 	by 	the 	property 	manager 	to 	the
Owners for approval. The Owners have not alleged a breach of
either contractual term. Because these terms are the exclusive
limitation on property and asset management fees under the
Agreement, the Owners cannot state a claim 	for breach of
contract 	or 	tortious 	interference 	based 	upon 	alleged
overcharging for fees without alleging that the fees were higher
than 3% and 2% of gross revenue or that they were not approved
as part of the yearly budget. Given that the amended complaint
makes no such allegations, it fails to state a claim for breach of

1600 Barberry Lane 8 LLC v. Cottonwood Residential OP LP
20180105-CA 	17 	2019 UT App 146
contract or tortious interference with a contract. The district
court did not err in dismissing these claims.
CONCLUSION
¶27 	We conclude that the Owners failed to state a claim for
breach of a fiduciary duty because the Agreement did not create
a fiduciary relationship with respect to fees charged for services.
Additionally, because the terms of the Agreement do not limit
the management fees to market value, the Owners have not
alleged a breach of the Agreement that could support either their
contract claim or their claim for tortious interference with a
contract. Accordingly, we affirm the district court’s order of
dismissal.