Opinion ID: 2049459
Heading Depth: 1
Heading Rank: 4

Heading: Count IIBreach of Contract

Text: RRC contends that the Court of Special Appeals erred in affirming the Circuit Court's dismissal of Count II of RRC's Amended Complaint, the charge premised upon BAA's alleged breach of the temporary sublease, for failure to state a claim upon which relief may be granted. Specifically, the Court of Special Appeals held that, [e]ven when read in a light most favorable to RRC, the complaint does not allege that BAA ever promised RRC either orally or in any lease document that, as the developer charged with improving BWI's concourse facilities, it would restrict the number of potentially competing gift stores to four. In addition, the intermediate appellate court noted that neither the alleged incorporation of the RFP's proposed concessions plan into the Master Lease or the temporary sublease, or the alleged fact that RRC based its negotiations and proposal to BAA in reliance on the RFP concessions plan, could transform MAA's preliminary proposals for development into an enforceable promise by BAA to RRC to restrict competition. We agree with the judgment of the Court of Special Appeals in this regard, and find that the Circuit Court did not err in dismissing Count II of RRC's Amended Complaint for failure to state a claim upon which relief may be granted. Count II of RRC's Amended Complaint asserts that BAA breached the terms of the temporary sublease when it allowed Hudson to operate more than the four competing News/Gifts stores contemplated by the RFP and proposed concessions plan. Specifically, Count II, entitled Breach of Contract, of RRC's Amended Complaint states: 43. Plaintiff adopts and incorporates the foregoing allegations of fact contained in paragraphs 1 through 42 as if stated herein. 44. Defendant BAA entered into an agreement with MAA in which in Article I, the Lessee's Proposal and the RFP issued by MAA were incorporated in and part of its contract. In its RFP, the MAA identified four locations for possible news/gifts sale locations at BWI. According to the terms of the master lease, the RFP and the subleases between BAA and RRC were incorporated into the master lease. According to the terms of paragraph 33 of the temporary sublease, the terms of the master lease are incorporated by reference. BAA was bound to a configuration of concession sales locations for news/gifts of four locations. RRC reasonably relied on the RFP and the representations concerning news/gift locations contained in the RFP when it entered into the temporary sublease and 2005 sublease agreement with BAA. 45. BAA breached this agreement by allowing Hudson and Hudson-related entities to operate more than the 4 competing stores contemplated by the RFP. 46. As a result of the material breach of the temporary sublease agreement by the Defendant BAA, the Plaintiff was unable to perform all of its obligations under the sublease agreement and suffered damages. As noted by the Court of Special Appeals, critical to the viability of Count II are the following factual assertions contained in the Amended Complaint: 13. The RFP issued by MAA included a proposed concession plan. In addition to existing RRC's stores, the concession plan, as revised in September 2004, included new spaces for the following concepts: Gourmet Coffee/Newstands-2 locations; Newstands-2 locations; News/Gifts-4 locations; News/Sundries-8 locations; Books/News/Coffee-2 locations. On information and belief, BAA responded to the RFP from MAA. 14. On or about March 10, 2004, and based in part on BAA's response to the RFP, MAA entered into a master lease and concession contract with BAA authorizing BAA to be its agent and to serve as developer of certain areas of BWI and to provide food, retail and service facilities to serve the needs of BWI patrons and employees. On information and belief, the master lease and concession contract between MAA and BAA incorporated the June 2003 RFP and proposed concession plan.    16. RRC entered negotiations with BAA. RRC based its negotiations and proposal to BAA in reliance on the RFP concession plan, which contemplated only four competing gift stores.    22. Pursuant to paragraph 33 of the temporary sublease, the terms of the Master Lease between MAA and BAA are incorporated by reference into the temporary sublease and both BAA and RRC are bound by all sublease obligations in the Master Lease. RRC notes correctly that, in order to state a claim for breach of contract, a plaintiff need only allege the existence of a contractual obligation owed by the defendant to the plaintiff, and a material breach of that obligation by the defendant. Taylor v. NationsBank, N.A., 365 Md. 166, 175, 776 A.2d 645, 651 (2001) (To prevail in an action for breach of contract, a plaintiff must prove that the defendant owed the plaintiff a contractual obligation and that the defendant breached that obligation.). The allegations contained in Count II of RRC's Amended Complaint, however, fail to satisfy this threshold. Although Count II states in conclusory fashion that BAA was bound to a configuration of concession sales locations for news/gifts of four locations, nowhere in the Amended Complaint does RRC allege an explicit or implicit promise by BAA to be so bound. Rather, the Amended Complaint alleges merely that the RFP, which contained a proposed concessions plan that contemplated four additional possible locations for future News/Gifts stores, was incorporated into the temporary sublease, that RRC based its negotiations in reliance upon the RFP's proposed concessions plan, and that, by allowing Hudson to open more than four new News/Gifts stores, BAA violated the RFP's proposed concessions plan. RRC makes no allegation, beyond the conclusory statement noted supra, that BAA ever obligated itself in any manner to a defined limit of four additional News/Gifts locations. In fact, that the 2005 sublease permitted RRC to open eight additional News/Gifts stores demonstrates clearly that the RFP did not serve to bind BAA to permit only four additional News/Gifts stores. In addition, RRC's Amended Complaint states that the Master Lease incorporated BAA's Lessee's Proposal, i.e., BAA's response to MAA's RFP and proposed concessions plan, suggesting further that BAA never bound itself to the proposed concessions plan contained in the RFP. As such, in Count II of the Amended Complaint, RRC failed to meet its duty under Continental Masonry to plead with certainty and definiteness a contract term, allegedly breached by BAA, that limited to four the number of additional News/Gifts locations that BAA could permit. Continental Masonry, 279 Md. at 481, 369 A.2d at 569 (noting that skeletal factual allegations accompanied by nothing more than mere conclusions and general averments of a breach of a contractual duty do not suffice to establish [the plaintiff's] somewhat unique and sophisticated claim). Thus, the Court of Special Appeals did not err when it affirmed the Circuit Court's dismissal of Count II for failure to state a claim upon which relief may be granted.