314 P.3d 688
N.M. Ct. App.2013Background
- Icek and Lauren Benz, and David and Martin Blanc formed Town Center Land, LLC (Town Center) and had prior business dealings in Central Market and Baptist Convention entities.
- In 2006 Benz settled a Central Market dispute with Blanc, receiving $34,200 and signing a written release (Central Market Release) that discharged “Central Market, Ltd. and David W. Blanc … and their predecessors and successors … from any and all known and unknown claims.”
- Benz later sued defendants (including Blanc and Town Center-related entities) for fraud, misrepresentation, breach of fiduciary duty, and sought an accounting and dissolution of Town Center; the Central Market Release was not referenced to include Town Center or the other corporate defendants by name.
- Defendants disclosed the Central Market Release as an exhibit shortly before trial; the district court admitted it over Benz’s objection, and effectively amended the pretrial order to treat release as a defense.
- The district court concluded the Release barred Benz’s claims against Blanc and the corporate defendants (except for dissolution), entered judgment for defendants, and awarded attorney fees; the Court of Appeals reversed as to application of the Release to the corporate defendants and to Blanc.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of the late-disclosed Central Market Release | Benz: late disclosure and absence of release defense in pleadings made admission unfair and prejudicial | Blanc: release need not be affirmatively pled; parties knew of the document | Court: admission and amendment of pretrial order were within district court discretion; no abuse shown |
| Whether defendants waived release defense by not pleading it | Benz: defense was not pled before trial and prejudiced trial preparation | Blanc: pretrial order may be modified; defense preserved by admission of the Release at trial | Court: no waiver—amendment of pretrial order to include the defense was permissible |
| Whether Release bars claims against Town Center and other unnamed corporate defendants | Benz: Release names only Central Market and Blanc; general-release presumption limits scope to named parties; no extrinsic evidence shows intent to release corporate defendants | Blanc: broad language (“any and all known and unknown claims”) and reference to successors/assigns shows intent to release these claims and entities | Court: reversed—general-release presumption favors only named parties; no extrinsic evidence that parties intended to release Town Center, Central Millennium, or Central Corridor; Release does not bar claims against those corporate defendants |
| Whether Release bars Benz’s claims against Blanc personally | Benz: Release concerned Central Market only; parties’ testimony showed limited intent | Blanc: Release’s broad language unambiguously released Blanc from “any and all” claims | Court: reversed—Release was unambiguous but its scope was confined to Central Market matters; it did not operate to release Blanc from Town Center claims under the factual record |
Key Cases Cited
- C.R. Anthony Co. v. Loretto Mall Partners, 112 N.M. 504, 817 P.2d 238 (court may consider extrinsic evidence to decide ambiguity) (establishing context-based approach to contract ambiguity)
- Mark V, Inc. v. Mellekas, 114 N.M. 778, 845 P.2d 1232 (contract ambiguity is a legal question; extrinsic evidence may be considered)
- Hansen v. Ford Motor Co., 120 N.M. 203, 900 P.2d 952 (general releases presumed to discharge only persons specifically named; burden on releasee to prove broader intent)
- Lujan v. Healthsouth Rehab. Corp., 120 N.M. 422, 902 P.2d 1025 (release language must clearly show intent to release unnamed parties)
- McNeill v. Rice Eng'g & Operating, Inc., 133 N.M. 804, 70 P.3d 794 (release interpretation governed by contract law; ambiguity can support multiple reasonable constructions)