Maine Coast Masonry, LLC v. Seymour

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STATE OF MAINE SUPERIOR COURT
CUMBERLAND, ss CIVIL ACTION
DOCKET NO. RE-19-201

MAINE COAST MASONRY LLC,

Plaintiff
V. ORDER

STACY SEYMOUR, et al.,

Defendants

Before the court are two motions by plaintiff Maine Coast Masonry: (1) a motion

to dismiss the counterclaim filed by defendants Stacy and Jeffrey Seymour for failure to

join necessary parties and in the alternative for an order requiring the joinder of the

allegedly necessary parties and (2) a motion to dismiss the counterclaim for lack of subject

matter jurisdiction and in the alternative to compel arbitration of the counterclaim.

Maine Coast Masonry (MCM) commenced this action against the Seymours

alleging that they owe money for landscape and hardscape work performed by MCM at

their property in Harpswell. MCM' s complaint contains five counts: (1) a claim to enforce

a lien pursuant to 10 M.R.S. §§ 3501 and 3251 against the property of both defendants; (2)

a claim for a declaratory judgment against Stacy Seymour; (3) a breach of contract claim

against Stacy Seymour; (4) an unjust enrichment claim against both defendants; and (5) a

quantum meruit claim against both defendants.

The Seymours thereafter filed a counterclaim against MCM containing five counts:

(1) breach of contract, (2) breach of warranty, (3) violation of the Home Construction

Contract Act; (4) violation of the Unfair Trade Practice Act; and (5) slander of title.

Plaintiff-Andre James Hungerford, Esq.
Defendant-Jason Rice, Esq.
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Necessary Parties

MCM argues that if anyone should be liable on the Seymours' counterclaims, it

should be Mainely Tubs and Gagne & Sons rather than MCM. Mainely Tubs and Gagne

& Sons apparently supplied certain hardscape materials installed at the Seymours'

residence. Accordingly, MCM argues that the Seymours' counterclaim should be

dismissed pursuant to M.R.Civ.P. 12(b)(7) and 19 for failure to join Mainely Tubs and

Gagne & Sons. In the alternative, MCM argues that the Seymours should be ordered to

join Mainely Tubs and Gagne & Sons.

First, even if Mainely Tubs and Gagne & Sons were necessary parties, dismissal

would not be appropriate because there is no showing they cannot be joined. Moreover,

they are not necessary Rule 19 parties in any sense. The Seymours are entitled to choose

MCM as the party whom they seek to hold liable on their counterclaim. They are not

required to join other parties just because MCM contends the other parties, rather than

MCM, should be responsible for any damages owed to the Seymours.

There is no reason why complete relief cannot be afforded in the absence of

Mainely Tubs and Gagne & Sons. At any trial MCM is entitled to point the finger at the

absent parties and argue that those parties, not MCM, are responsible for the alleged defects

on which the Seymours base their counterclaim. Nor do the absent parties claim any interest

in the dispute between MCM and the Seymours that will be impaired if they are not made

parties.

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Finally, if MCM thinks that Mainely Tubs and Gagne & Sons should be made

parties to this action, MCM can file a third-party complaint against them and bring them

in as third-party defendants on the counterclaim pursuant to M.R.Civ.P. 14(b).

Subject Matter Jurisdiction and Arbitration

At the outset, MCM' s argument that this court lacks subject matter jurisdiction over

the Seymours' counterclaim because of an arbitration clause in the contract between M CM

and Stacy Seymour can be summarily rejected. The court's subject matter jurisdiction is

not limited or defined by provisions in a private contract. See Windham Land Trust v.

Jeffords, 2009 ME 29 ,r 21, 967 A.2d 690. The court is specifically granted jurisdiction

under 14 M.R.S. § 5943 to enforce arbitration agreements.

Alternatively, MCM seeks an order compelling arbitration pursuant to the

following provision contained in a contract signed by MCM and Stacy Seymour on or

about April 24, 2019:

The parties agree that disputes concerning the terms of this
contract, except past due amounts owed by Homeowner, are
subject to binding arbitration in accordance with the Maine
Uniform Arbitration Act .... The Parties shall mutually
agree in writing upon one neutral arbitrator located in
Portland, Maine within 14 days of notification of a dispute.
This Section does not prohibit Contractor from going to
court to collect any past due amounts.

Hardscape Contract§ 8. This arbitration provision- drafted by MCM 1 - is obviously one­

sided, allowing MCM to pursue claims for past due amounts in court while sending

disputes concerning "the terms of this contract" to arbitration.

1 The contract, which is attached as Exhibit 1 to MCM complaint, is on a preprinted form titled
"Hardscape Contract - Maine Coast Masonry LLC."

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In its original motion MCM sought to compel both Stacy and Jeff Seymour to

arbitrate with respect to the counterclaim. Because only Stacy Seymour signed the contract,

however, MCM thereafter conceded in its Reply Memorandum that Jeff is not required to

arbitrate his counterclaim but argues that Stacy Seymour should at least be compelled to

arbitrate. 2

At this point the court is constrained to note that there is some inconsistency with

respect to Jeff Seymour's status in this case. The Hardscape Contract lists "Stacy & Jeff

Seymour" as "Homeowner" but is signed only by Stacy. Presumably this is why MCM's

declaratory judgment and breach of contract claims have been asserted only against Stacy.

On the other hand, the Seymours' breach of contract and breach of warranty counterclaims

are nominally brought in the name of both Stacy and Jeff Seymour. If Jeff Seymour is

entitled to assert those counterclaims, there is at least a question whether he should be

treated as a party to the contract for purposes of the arbitration clause.

This probably does not matter because Jeff Seymour does not have defenses or

claims for damages independent of those possessed by his wife. If arbitration is ordered, it

can proceed with Stacy as the signatory on the contract, and that will as a practical matter

resolve her husband's claims as well.

Aside from that issue, however, the arbitration clause is itself problematic because

by its express terms it covers "disputes concerning the terms of this contract" yet allows

MCM to pursue past due amounts in court. This requires the court to consider which of the

disputes between the parties in this case involve "the terms of the contract" and which do

2 MCM Reply to Defendants' Opposition (Arbitration) dated February 18, 2020 at 1-2.

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not. The court does not agree with MCM's argument that the arbitration provision should

be interpreted to allow MCM to continue with what it apparently considers to be a

collection action while relegating all of the Seymours' claims and defenses to arbitration. 3

Because of the policy favoring arbitration, there is a principle that arbitration

clauses should be interpreted as requiring arbitration unless "the arbitration clause is not

susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved

in favor of arbitration." VIP Inc. v. First Tree Development LLC, 2001 ME 73 ,r 4, 770

A.2d 95, quoting Westbrook School Committee v. Westbrook Teachers Assn., 404 A.2d

204, 208 (Me. 1979).

At the same time the Law Court has also ruled that ambiguities in an arbitration

provision should be interpreted against the party who drafted that provision, Barrett v.

McDonald Investments Inc., 2005 ME 43 ,r,r 17-18, 820 A.2d 146. In this case that means,

at a minimum, that "disputes concerning the terms of the contract" should not be interpreted

any more broadly than disputes about the meaning of the contract and about its provisions. 4

Disputes of that nature are arbitrable, but disputes about performance or non-performance

under the contract are not.

In this connection, if MCM had used the contract provisions set forth in the Home

Construction Contract Act instead of using a contract containing a waiver of that Act, those

3 In addition, when arbitration is ordered, it usually proceeds first, which in this case would mean

that the case would stop while the Seymour's counterclaim went to arbitration.

4 This would include whether the contract contains a valid waiver of the Home Construction
Contract Act and, if not, whether there was any violation of that Act. Because the Seymours'
Unfair Trade Practice Act claim (count 4 of their counterclaim) appears to be based solely on
violation of the Home Construction Contract Act, see 10 M.R.S. § 1490 (violation of Home
Construction Contract Act is prima facie evidence of a UTPA violation), that issue would be
included as well.

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provisions would have included a provision for arbitration of "disputes concerning the

provisions of the contract or the performance of the parties." 10 M.R.S. § 1487(8)

(emphasis added). MCM omitted the italicized words in its arbitration provision, and the

court assumes that was a considered choice to allow MCM to sue for past due amounts.

MCM will be held to that choice.

In Counts One and Two of their counterclaim the Seymours allege that MCM did

not complete its work under the contract. Counterclaim, 7, 16. They also allege that MCM

did not perform the contract work in a workmanlike and skillful manner. 5 See Counterclaim

,, 6, 8, 17, 20-21. The latter appears to be their primary contention. These claims, if proven,

would also constitute a defense to the claims in MCM' s complaint.

Whether MCM completed its work under the contract might or might not amount

to a dispute as to the terms of the contract. On that issue, the Seymours shall submit by

May 6, 2020 an offer of proof with respect to their claim that MCM did not complete its

work. MCM shall have 10 days to respond. 6 The court will then be able to determine

whether the allegations in paragraphs 7 and 16 of the counterclaim constitute a dispute

concerning the terms of the contract.

However, the issue of whether MCM performed the hardscape work in a

workmanlike and skillful manner is not an issue that constitutes a "dispute concerning the

terms of [the] contract" and is not subject to arbitration. Similarly, the Seymours' slander

5 The written contract contains a wat1'anty provision but, regardless of the contract language,

contracts of this nature include an implied wat1'anty that the work will be perfonned in a
reasonably skillful and workmanlike manner. See Gosselin v. Better Homes Inc., 256 A.2d 629,
639-40 (Me. 1969).

6 In setting the above deadlines, the cou1t has already taken into account the extension of

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of title claim is not a dispute concerning "the terms of [the] contract" and is similarly not

subject to arbitration.

Since arbitration is required for certain of the issues in the case but not others, the

Seymours make the practical argument that the issues should not be fragmented and that

all of the issues should be litigated in the court proceeding. Unfortunately, this does not

appear to be the law. See Dean Witter Reynolds Inc. v. Byrd, 470 U.S. 213, 217 ( 1985).

To the same effect, Maine's arbitration statute states that when issues are severable, a stay

should only be granted as those issues subject to arbitration. 14 M.R.S. § 5928(4).

The court therefore concludes that MCM' s motion to compel arbitration should be

granted in part and that arbitration shall proceed with respect to Counts Three and Four of

the Seymours' counterclaim and with respect to the issue of whether MCM failed to

complete its work under the contract - if the latter issue is found to be arbitrable.

Proceedings with respect to those issue shall be stayed pending arbitration. To the extent

that those issues can be severed from the other issues in the case, the remaining issues in

the case need not necessarily be stayed. 14 M.R.S. § 5928(4). The court will, however,

await subsequent submissions before deciding whether arbitration should proceed first.

The entry shall be;

1. Plaintiff Maine Coast Masonry's motion to dismiss defendants' counterclaim or
in the alternative to require defendants to join other parties is denied.

2. Plaintiff Maine Coast Masonry's motion to dismiss defendants' counterclaim for
lack of subject matter jurisdiction is denied.

3. Plaintiffs motion in the alternative to compel arbitration is granted in part and
arbitration shall proceed on the claims in Counts Three and Four in defendants'
counterclaim. Proceedings on those counts shall be stayed pending arbitration.

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4. Plaintiffs motion to compel arbitration is denied with respect to the Seymours'
claim of poor workmanship and with respect to their slander of title claim.

5. Because there is one other issue that may be subject to arbitration, defendants
shall submit an offer of proof with respect to their claim that MCM did not complete its
work on or before May 6, 2020. MCM shall have IO days to respond.

6. The clerk shall incorporate this order in the docket by reference pursuant to Rule
79(a).

Dated: March 21, 2020

Thomas D. Warren
Justice, Superior Court

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