Opinion ID: 2302242
Heading Depth: 3
Heading Rank: 2

Heading: The Remaining Counterclaims Against Charles and Marguerite Takian (Counts 2, 3, 4, 5, 6, 9, 10 and 11)

Text: A release is a contractual agreement governed by the principles of contract law. See Young v. Warwick Rollermagic Skating Center, Inc., 973 A.2d 553, 558 (R.I.2009). As this Court held in Guglielmi v. Rhode Island Hospital Trust Financial Corp., 573 A.2d 687, 689 (R.I. 1990): The law concerning this issue is well settled in this jurisdiction. The validity of a release must be determined in light of three factors: (1) the existence of consideration for the release, (2) the experience of the person executing the release, and (3) the question of whether the person executing the release was represented by counsel. Finding satisfactory answers to these questions, the court will find a release to be valid and binding unless it has been procured through fraud, misrepresentation, overreaching, or a material mistake on the part of either party. We agree with the motion justice's finding that the parties did not seriously dispute whether the release was proper on its face. See Guglielmi, 573 A.2d at 689. However, the motion justice also ruled that the release should not be set aside because of fraud or misrepresentation. He based that finding on his conclusion that defendants knew when they signed the document not only about plaintiffs' mismanagement and misappropriation, but also about the potential for more significant wrongdoing. His decision relied primarily on defendants' memorandum to plaintiffs containing the threat to conduct a full audit. He found the $100,000 ultimatum was tantamount to an admission by defendants that they knew about more serious improprieties, and he concluded that they were making peace and willing to let sleeping dogs lie. [9] Whether plaintiffs committed acts or omissions that would render the release voidable, however, requires the resolution of material facts that the parties genuinely, indeed vigorously, disputed. See Guglielmi, 573 A.2d at 689. The record clearly shows that defendants steadfastly and vigorously contended throughout the course of this litigation that their demand for a $100,000 payment from plaintiffs represented, in their minds, only their fair share of distributions based on what they believed had already been distributed to plaintiffs, plus additional losses attributable to plaintiffs' mismanagement, but not for any further wrongdoings. Indeed, one of defendants' contentions was that they discovered evidence of wrongful acts  such as the letters from the late 1990s directing the trailer park tenants to make their rent checks payable to Charles Takian personally  only after the Takians had presented them with the release, and after they had executed it. When the motion justice decided otherwise, it is our opinion that he necessarily considered the evidentiary weight of the memorandum against the alternative evidence, and that he erred when he construed that evidence against defendants and not in the light most favorable to the nonmoving party. [10] See Zanni, 13 A.3d at 1071; Classic Entertainment & Sports, Inc., 988 A.2d at 849. The same is true of the motion justice's findings that defendants were sophisticated businesspeople, and his findings on the extent to which they may have been aware of negotiations with the tenants association about the sale of the property. Furthermore, there is, in our judgment, a triable issue of fact with respect to whether plaintiffs breached a duty of loyalty to defendants as the officers of a closely-held corporation. See Hendrick v. Hendrick, 755 A.2d 784, 789 (R.I.2000) (We are mindful that `[c]orporate officers and directors of any corporate enterprise, public or close, have long been recognized as corporate fiduciaries owing a duty of loyalty to the corporation and its shareholders   .' (quoting A. Teixeira & Co., 699 A.2d at 1386)). [S]ummary judgment should occasion the termination of a case only where it is absolutely clear `that no genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law.' Estate of Giuliano, 949 A.2d at 394. The judge's belief that one scenario is more probable than the other is not a legally sufficient reason to grant a motion for summary judgment. McPhillips, 582 A.2d at 750. Although a motion justice entertaining such a motion may search for the existence of factual issues, he or she may not determine them    nor may the trial justice assess the weight or the credibility of the evidence. Id. at 749. Those duties fall within the province of a fact-finder. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions   .). Therefore, we vacate the judgment of the Superior Court on plaintiffs' motion for summary judgment with respect to counts 2, 3, 4, 5, 6, and 8 against Charles and Marguerite Takian. Because we have concluded that the motion justice's ruling with respect to the release was error, we also must revisit counts 10 and 11 of defendants' counterclaim, which alleged a violation of the Rhode Island Racketeer Influenced and Corrupt Organizations Act and conspiracy to violate that act, respectively, against Charles, Marguerite, and Randolph Takian. Understandably, the trial justice found that defendants' RICO counterclaims were disposed of by [his] decision upholding the validity of the release; and he did not provide any further analysis of those claims. [11] In light of our holding that there were disputed issues of fact precluding summary judgment regarding whether the release should be set aside, and the lack of a detailed analysis from the trial judge on the validity of the RICO claims, we vacate the judgment of the Superior Court with respect to counts 10 and 11, and remand the matter for a ruling on whether the court should grant summary judgment in favor of the plaintiffs on those claims.