Berg v. Frobish et al

Filing 319

MEMORANDUM AND ORDER overruling plaintiff's 105 Motion To Dismiss Counterclaim For Breach Of Contract And Proposed Second Amended Cause For Breach Of Contract (Covenant Of Land Use Rights) For Failure To Plead A Justiciable Cause Of Action. Signed by Chief Judge Kathryn H. Vratil on 6/4/2013. (mg)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
JERRY L. BERG,

)
)
Plaintiff/
)
Counterclaim Defendant, )
)
v.
)
)
JON L. FROBISH, et al.,
)
)
Defendants/
)
Counter Claimants.
)
____________________________________)

CIVIL ACTION
No. 12-1123-KHV

MEMORANDUM AND ORDER
Plaintiff brings an action against Cedar Lakes Village Condominium Association (“the
Association”) and others for assault and battery, fraud, violation of the Fair Debt Collection Practices
Act, 15 U.S.C. § 1692k, and injunctive relief arising out of ongoing disputes between the parties.
Defendants bring counterclaims for assault and battery,1 fraud, breach of contract and injunctive relief.
This matter is before the Court on plaintiff’s Motion To Dismiss Counterclaim For Breach Of Contract
And Proposed Second Amended Cause For Breach Of Contract (Covenant Of Land Use Rights) For
Failure To Plead A Justiciable Cause Of Action (Doc. #105) filed November 5, 2012. Plaintiff, an
owner and member of the Association,2 seeks dismissal of the Association’s counterclaim for breach
of contract. See Second Amended Counterclaims (Doc. #79) filed November 12, 2012. Plaintiff argues
that the Association’s breach of contract counterclaim fails to plead an essential element and fails to
assert any legally cognizable basis for damages, and that it should therefore be dismissed pursuant to

1

Jon Frobish is the only defendant to bring the assault and battery counterclaim, and
Frobish is the only party whom plaintiff names in the same cause of action.
2

The Association is a Kansas condominium corporation.

Fed. R. Civ. P. 12(b)(6) for failure to state a claim upon which relief can be granted. For the following
reasons the Court overrules plaintiff’s motion.
Legal Standards
In ruling on a motion to dismiss under Rule 12(b)(6), Fed. R. Civ. P., the Court assumes as true
all well-pleaded factual allegations and determines whether they plausibly give rise to an entitlement
of relief. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). To survive a motion to dismiss, a complaint or
counterclaim must contain sufficient factual matter to state a claim which is plausible – and not merely
conceivable – on its face. Id. at 679-80; Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). In
determining whether it states a plausible claim for relief, the Court draws on its judicial experience and
common sense. Iqbal, 556 U.S. at 679.
The Court need not accept as true those allegations which state only legal conclusions. See id.;
Hall v. Bellmon, 935 F.3d 1106, 1110 (10th Cir. 1991). Here, defendant bears the burden of framing
its counterclaim with enough factual matter to suggest that it is entitled to relief; it is not enough to make
threadbare recitals of a cause of action accompanied by conclusory statements. Twombly, 550 U.S. at
556. Defendant makes a facially plausible claim when it pleads factual content from which the Court
can reasonably infer that plaintiff is liable for the misconduct alleged. Iqbal, 556 U.S. at 678.
Defendant must show more than a sheer possibility that plaintiff has acted unlawfully – it is not enough
to plead facts that are “merely consistent with” liability. Id. (quoting Twombly, 550 U.S. at 557). A
pleading which offers labels and conclusions, a formulaic recitation of the elements of a cause of action,
or naked assertions devoid of further factual enhancement will not stand. Iqbal, 556 U.S. at 678.
Similarly, where the well-pleaded facts do not permit the Court to infer more than the mere possibility
of misconduct, the complaint has alleged – but has not “shown” – that the pleader is entitled to relief.

-2-

Id. at 1950. The degree of specificity necessary to establish plausibility and fair notice depends on
context, because what constitutes fair notice under Rule 8(a)(2), Fed. R. Civ. P., depends on the type
of case. Robbins v. Oklahoma, 519 F.3d 1242, 1248 (10th Cir. 2008) (citing Phillips v. Cnty. of
Allegheny, 515 F.3d 224, 232-33 (3d Cir. 2008)).
Facts
The counterclaim alleges the following facts:
Plaintiff served as the Association’s property manager for approximately three years. The
Association terminated the relationship because plaintiff breached the services contract and he
intimidated, frightened and appalled residents with bizarre and outrageous behavior. The Association
board has made police reports and individuals have sought legal protection against harassment by filing
“Protection From Stalking” actions against plaintiff in the District Court of Sedgwick County, Kansas.
At virtually every monthly board meeting and all semi-annual member meetings, police are present to
observe and intervene if plaintiff explodes or becomes violent and/or verbally abusive. Plaintiff has
engaged in perpetual litigation against the Association and its residents. The second amended
counterclaim recounts specific incidents of plaintiff’s conduct, as do dozens of other documents and
many hours of testimony before Magistrate Judge Kenneth G. Gale.
In January of 2010, plaintiff filed a civil action in Sedgwick County District Court for an
injunction and temporary restraining order against the Association and some condominium residents.
The action included allegations of intentional, knowing and illegal denial of access to condominium
records. The state court granted summary judgment to defendants and awarded the Association

-3-

$3,526.97 in costs and attorney’s fees.3 In a subsequent action against the Association and others, the
Sedgwick County District Court granted defendants’ motion for judgment on the pleadings and awarded
the Association $3,650 in attorney’s fees. Plaintiff has failed to pay these judgments. Although plaintiff
claims that the Association settled the judgments for $100, he fraudulently altered a document on which
he relies to substantiate his claim.
In its breach of contract counterclaim, the Association asserts that as a unit owner, plaintiff is
governed by various contracts and documents that pertain to the Cedar Lake Village Condominium
development. These documents mandate that homeowners refrain from activities that impose unwanted
annoyances or nuisances on their neighbors, and that homeowners pay assessments and/or financial
obligations to the Association. The Association alleges that plaintiff’s conduct constitutes a nuisance
under the governing documents, and that plaintiff’s refusal to pay his financial obligations violates those
documents. With respect to damages, the Association asserts that realtors do not want to show and unit
owners cannot sell their units, and that would-be sellers must disclose plaintiff’s existence on a seller’s
condition report. The Association asserts that plaintiff’s behavior has stigmatized the value of the Cedar
Lakes Village Condominiums in the estimated amount of $11,325,000.
In his petition,4 plaintiff alleges and the Association admits that the Association’s Declaration
is an official document duly recorded in the Sedgwick County Register of Deeds, and that it includes
all required elements that define a condominium association corporation under the Kansas Apartment
Ownership Act, K.S.A. §§ 58-3101 to 58-3129. Plaintiff attaches as an exhibit to his petition a copy

3

The second amended counterclaim also alleges that the state court awarded separate
attorney’s fees to other counter-claimants.
4

Plaintiff filed this action in Sedgwick County District Court, and defendants removed
the action to this Court.
-4-

of a “Statement of Assessment Lien” dated November 22, 2010, which the Association created to
provide notice of its lien against plaintiff’s unit in the amount of $9,248.47. Plaintiff disputes the
assessment upon which the lien is based but does not challenge the Association’s authority to make
proper assessments.
Analysis
The elements of a breach of contract claim are as follows: (1) the existence of a contract
between the parties; (2) consideration; (3) defendants’ performance or willingness to perform in
compliance with the contract; (4) plaintiffs’ breach of the contract; and (5) damage on account of the
breach. Britvic Soft Drinks Ltd. v. ACSIS Techs., Inc., 265 F. Supp.2d 1179, 1187 (D. Kan. 2003).
Plaintiff contends that the Association’s counterclaim for breach of contract fails to plead an
essential element of the cause of action and fails to assert a legally cognizable basis for damages. The
Association asserts that the contracts in this case – the Association’s declaration and the Cedar Lake
Village Condominium Rules, Regulations & Policies – are uncontroverted, binding on plaintiff and set
forth clear obligations.
The Court agrees that the declaration operates in the nature of a contract. See, e.g., 2
Restatement (Third) of Property, § 6.13, comment (c) (property owners may bring contract suits
pursuant to condominium association governing documents). Plaintiff does not contest the validity of
the declaration, which guarantees that each owner is entitled to the exclusive ownership, use and
possession of his or her unit and the adjoining limited common areas. This guarantee, however, is
subject to the provisions of the Kansas Apartment Ownership Act,5 the Association bylaws, the
declaration and the Association rules and regulations. See Declaration § 3.1(E), Doc. #112-1 at 16.

5

K.S.A. §§ 58-3101 to 58-3129.
-5-

Indeed, the Apartment Ownership Act imposes the following obligations:
Each apartment owner shall comply strictly with the bylaws and with the administrative
rules and regulations adopted pursuant thereto, . . . and with the covenants, conditions
and restrictions set forth in the declaration. . . . Failure to comply with any of the same
shall be ground for an action to recover sums due, for damages or injunctive relief or
both maintainable by the manager or board of directors on behalf of the association.
K.S.A. § 58-3107.
Accordingly, plaintiff is bound to observe all of the Association’s governing documents.
Plaintiff does not dispute the validity of the documents and thus concedes the existence of a contract.
The Association alleges that plaintiff’s conduct constitutes a breach of the governing documents, and
that the Association has suffered damages caused by plaintiff’s breach. The Association has adequately
stated a claim for breach of contract.
IT IS THEREFORE ORDERED that plaintiff’s Motion To Dismiss Counterclaim For Breach
Of Contract And Proposed Second Amended Cause For Breach Of Contract (Covenant Of Land Use
Rights) For Failure To Plead A Justiciable Cause Of Action (Doc. #105) filed November 5, 2012 be and
hereby is OVERRULED.
Dated this 4th day of June, 2013, at Kansas City, Kansas.
s/ Kathryn H. Vratil
KATHRYN H. VRATIL
United States District Judge

-6-