38 F. Supp. 3d 222
D.P.R.2014Background
- Linares-Acevedo and wife sue Donald Acevedo, Rich Port Development, LLC, and others in a diversity action for fraud, misrepresentation, breach of contract, and Article 1802 damages.
- Linares contracted to buy two SC lots from Acevedo; title was never transferred.
- The lots are located in a flood-prone area; Acevedo allegedly knew of this risk but failed to disclose it.
- Purchase price was $68,000 with down payment and installments; plaintiffs fully paid $68,000.
- South Carolina law governs breach, fraud, and misrepresentation; Article 1802 claim is disputed.
- Court grants summary judgment on Article 1802 claim but denies summary judgment on remaining contract/fraud claims; jurisdiction under 28 U.S.C. § 1332 remains contested.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is there subject matter jurisdiction based on amount in controversy? | Linares may recover over $75,000. | Amount in controversy may be below $75,000. | Not a legal certainty that >$75,000; jurisdiction satisfied. |
| Is Article 1802 claim viable in this commercial transaction case? | Article 1802 applies to tort arising from contract. | Article 1802 generally does not apply to commercial transactions; claim intertwined with contract. | Dismissed for lack of independent Article 1802 claim. |
| Should there be summary judgment on breach of contract, fraud, and negligent misrepresentation? | Genuine issues of material fact exist. | No genuine issues; merits resolved on summary judgment. | Summary judgment inappropriate on these claims. |
| What law governs the substantive claims in this diversity case? | South Carolina law applies to contract and tort claims. | SC law should apply where the property is located; diverse determination unaffected. | South Carolina law governs substantive claims. |
| Do the facts raise a genuine issue of material fact on contract formation and transfer of title? | There was a valid contract; title not conveyed due to implied breach. | Nonpayment or contract terms delay conveyance; unclear timing. | Genuine issues of material fact preclude summary judgment on breach. |
Key Cases Cited
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (summary judgment standards; material facts)
- Calero-Cerezo v. U.S. Dep’t of Justice, 355 F.3d 6 (1st Cir. 2004) (framework for genuine disputes under summary judgment)
- Leary v. Dalton, 58 F.3d 748 (1st Cir. 1995) (evidence viewed in light favorable to nonmovant)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (U.S. 1986) (standard for overcoming speculation in damages/motion practice)
- Celotex Corp. v. Catrett, 477 U.S. 317 (U.S. 1986) (burden-shifting in summary judgment)
- Diaz Irizarry v. Ennia, N.V., 678 F. Supp. 957 (D.P.R. 1988) (consequential damages for contract damages context)