Vitorino America v. Sunspray Condominium Association
2013 ME 19
Me.2013Background
- America owns a Sunspray unit and sues the Association and Board members for failure to enforce a smoking ban enacted in 2009 and extended to the entire property in 2010.
- Plaintiff asserts the ban is enforceable by the MCA and MNCA and that the Board acted in bad faith in enforcing it.
- Plaintiff initially pleads five counts: breach of fiduciary duty, MCA violation, MNCA violation, breach of contract, and negligence, plus requests injunctive relief and damages.
- The trial court dismissed the smoking-ban claims under Rule 12(b)(6); America sought reconsideration and to amend the complaint for a second time, which was denied.
- America stipulated to dismissal of remaining claims after partial dismissal, preserving the right to appeal the smoking-ban dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a derivative action is available for a nonprofit condominium association | America argues equity permits a derivative suit despite no explicit statutory authorisation. | Defendants contend no explicit authorization exists for derivative suits by nonprofit associations or condominiums. | Derivative actions not available; no statutory authorization. |
| Whether the individual smoking-ban claims state a cognizable injury | America alleges exposure to secondhand smoke as a legally cognizable injury. | Defendants argue alleged injuries are insufficient without particularized injury or physical harm. | Claims fail; no cognizable injury shown. |
| Whether the business judgment rule bars the smoking-ban claims | America contends the Board acted in bad faith by not enforcing the ban adequately. | Board decisions are protected by the business judgment rule absent fraud or bad faith; disagreement over enforcement is not bad faith. | Business judgment rule applies; no bad-faith failure shown. |
| Whether the negligence claim is viable given the injury requirement | Exposure to secondhand smoke constitutes injury and duty in enforcing the ban. | No actionable injury without specific physical harm; negligence requires actual injury. | Negligence claim properly dismissed for lack of cognizable injury. |
Key Cases Cited
- Voisine v. Berube, 38 A.3d 310 (Me. 2011) (derivative suit limitations in equity context)
- Shostak v. Shostak, 851 A.2d 515 (Me. 2004) (business judgment rule applies to corporate decisions)
- Rosenthal v. Rosenthal, 543 A.2d 348 (Me. 1988) (limits on judicial review of board decisions)
- Burns v. Architectural Doors & Windows, 19 A.3d 823 (Me. 2011) (aggrieved party must show cognizable injury)
- Nelson v. Bayroot, LLC, 953 A.2d 378 (Me. 2008) (particularized injury standard for aggrieved party)
- In re Hannaford Bros., Co. Customer Data Sec. Breach Litig., 2010 ME 93 (Me. 2010) (actual injury required for negligence claims)
- Ramsey v. Baxter Title Co., 54 A.3d 710 (Me. 2012) (de novo review of sufficiency after 12(b)(6) dismissal)