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Tort Law Appellate Court Opinion

by Mazur, Catherine

 

AC39274 - Wiederman v. Halpert (Breach of fiduciary duty; "In this action arising from a real estate investment agreement, the defendants Isaac Halpert and Marsha Halpert appeal from the judgment of the trial court denying their motion to open the judgment rendered against them following a hearing in damages held after they had been defaulted for failing to appear at a trial management conference. The trial court held a hearing in damages and awarded the plaintiff, Malkie Wiederman, $600,892.58 in compensatory and punitive damages, attorney's fees and costs, on her claims of breach of fiduciary duty, fraud, conversion and bad faith. The defendants claim on appeal that (1) the trial court lacked subject matter jurisdiction to hear the plaintiff's claims because the plaintiff did not have standing to assert them; (2) the trial court failed to make a determination as to the legal sufficiency of the plaintiff's claims of breach of fiduciary duty, fraud, conversion and bad faith; (3) there was no causal connection between the defendants' allegedly wrongful conduct and the losses for which the court awarded the plaintiff compensatory damages; (4) the trial court erred in finding Marsha Halpert liable for fraud and conversion absent sufficient allegations of those claims against her; and (5) the court erred in awarding the plaintiff punitive damages in addition to attorney's fees on her claim of fraud. The defendants concede that they failed to raise any of the foregoing claims in their motion to open the judgment, and thus that the law ordinarily precludes this court from considering those claims on appeal. The defendants nevertheless seek review of their claim that court erred in denying their motion to open on the grounds that the plaintiff lacked standing to assert her claims against the defendants and thus that the trial court lacked subject matter jurisdiction, and that the judgment contained plain errors that resulted in manifest injustice. We agree that the plaintiff failed to properly plead a claim for conversion against Marsha Halpert, and thus that the court's judgment finding her liable for conversion must be reversed. We also agree with the defendants' claim that the court committed plain error in awarding the plaintiff punitive damages in addition to attorney's fees on her claim of fraud, and thus we conclude that the award of punitive damages must be vacated.")