Court Opinion

ID: 2800099
Source: CourtListenerOpinion
Date Created: 2015-05-12 15:12:29.777584+00
Date Added: 2024-06-11T11:31:26.930445
License: Public Domain

MAINE SUPREME JUDICIAL COURT                                         Reporter of Decisions
Decision: 2015 ME 63
Docket:   BCD-14-294
Argued:   April 9, 2015
Decided:  May 12, 2015

Panel:          SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, JABAR, and HJELM, JJ.

                                  PAUL REMMES et al.

                                            v.

                      THE MARK TRAVEL CORPORATION et al.

ALEXANDER, J.

         [¶1] Plaintiffs Paul and Holly Remmes and Robert H. and Lucy Begin

appeal from a judgment entered in the Business and Consumer Docket (Horton, J.)

granting The Mark Travel Corporation’s motion for summary judgment.                   On

appeal, the plaintiffs contend that the trial court erred by determining that (1) the

plaintiffs’ travel agent was not an agent of Mark Travel; (2) the plaintiffs’ original

hotel accommodations, arranged through Mark Travel, were properly rescinded for

failure of consideration; and (3) releases signed by the plaintiffs as a precondition

for rebooking their accommodations barred their claims against Mark Travel.

         [¶2]    The trial court correctly determined that the plaintiffs’ breach of

contract and other claims against Mark Travel failed as a matter of law because the

plaintiffs’ travel agent never acted as Mark Travel’s agent and because Mark

Travel did not authorize the travel agent to act on its behalf, see Restatement
2

(Third) of Agency § 3.14 cmt. c (2006), ratify the travel agent’s fraudulent

conduct, see Perkins v. Philbrick, 443 A.2d 73, 75 (Me. 1982), or hold the travel

agent out as its agent, see Levesque v. Cent. Me. Med. Ctr., 2012 ME 109, ¶ 10 n.7,

52 A.3d 933. Therefore, we affirm the trial court’s judgment.

                                         I. CASE HISTORY

        [¶3] Viewing the record in the light most favorable to the non-prevailing

parties, see Beal v. Allstate Ins. Co., 2010 ME 20, ¶ 11, 989 A.2d 733, the

summary judgment record contains the following facts, which are undisputed

unless otherwise noted. Plaintiffs Paul and Holly Remmes and Robert H. and Lucy

Begin are residents of Maine. The Mark Travel Corporation is a corporation with

its principal place of business in Milwaukee, Wisconsin. It sells leisure tour and

travel products to consumers either directly or through the consumers’ travel

agents. Mark Travel, at times, did business under the names “Funway Holidays

Funjet Inc.” and “Funjet Vacations,” but is one entity.

        [¶4] Beth Rogers was a travel agent who operated a travel agency in Saco

called TravelWise.1 There is no evidence in the record that Rogers or TravelWise

ever claimed to be an agent of Mark Travel or that any contract creating an agency

relationship existed between Rogers and/or TravelWise and Mark Travel.

    1
        Although Rogers was named as a defendant (“Beth M. Rogers, a/k/a Beth McInnis, d/b/a
TravelWise”) in the civil suits that resulted from the facts underlying this matter, Rogers did not appear in
either action.
                                                                               3

Likewise, there is no evidence in the record that Mark Travel ever claimed that

Rogers or TravelWise was its agent for any purpose.

      [¶5] In August or September of 2011, the Remmeses contacted Rogers at

TravelWise seeking an all-inclusive vacation for a party of nine. Rogers told the

Remmeses about a resort in the Dominican Republic that could accommodate the

party, which Rogers later advised could be booked only through a travel agent.

Rogers advised the Remmeses that they could reduce their costs if they paid by

check rather than credit card. The Remmeses then gave Rogers a check payable to

TravelWise for $26,517, covering the full cost of airfare and accommodations at

the resort for the group.

      [¶6] The Remmeses invited the Begins to join them on the trip, and the

Begins contacted Rogers and asked her to book them the same trip. Again, she

recommended that they pay by check to save money, and the Begins gave her a

check payable to TravelWise for $8,801.92, covering their airfare and resort

accommodations. The trip was to begin the week of June 20, 2012.

      [¶7] Rogers booked air travel and lodging at the resort for the plaintiffs

through Mark Travel. Rogers paid to Mark Travel some of the funds the plaintiffs

paid to her—about $10,000 of the Remmeses’ payment and about $4,000 of the

Begins’ payment—to pay for the airfare. Rogers paid Mark Travel for the lodging

by using the credit card information of other TravelWise clients, without those
4

clients’ knowledge or consent. The record does not reveal what happened to the

rest of the money the plaintiffs gave Rogers. Believing that it had received proper

payment from Rogers, Mark Travel sent “E-Travel” documents to Rogers, who in

turn gave them to the plaintiffs.2

        [¶8] In early June of 2012, Mark Travel learned of the credit card fraud on

these and other vacations Rogers had booked. Mark Travel then reversed the

credit card charges and canceled the plaintiffs’ reservations at the resort, consistent

with its policy for unpaid bookings. Mark Travel had not yet paid the resort, and it

did not incur any fees, penalties, or costs in cancelling the reservation.

        [¶9] On or about June 8, 2012, the plaintiffs, after hearing rumors about

Rogers and TravelWise, contacted Mark Travel to check on their reservations. The

plaintiffs were initially told that each of their reservations was “all set,” but later

that day they were told that there could be “a problem” with their reservations.3

On June 11, the week before their planned trip, an employee from Mark Travel

told the plaintiffs that the lodging payments sent by TravelWise had been

    2
      The parties dispute the character of these E-Travel documents. The plaintiffs characterize the
documents as tickets and vouchers that, standing alone, would gain them entry to their lodging, even after
the reservation was later cancelled. Mark Travel characterizes the documents as providing an itinerary,
confirmation numbers, and proof that the reservation had been made, that once the reservation was
cancelled the documents meant nothing, and that all the plaintiffs needed to do to gain entry to their
lodging was give their names. However, the character of the documents is not a material fact.
    3
      Mark Travel denies that any employee told the plaintiffs that their lodging reservations were all set
or otherwise, but the distinction is not material.
                                                                                                        5

fraudulent, and that their resort reservations had been or would be cancelled for

nonpayment.4

         [¶10] Mark Travel agreed to assist the plaintiffs in rebooking their resort

accommodations, but only if they paid for the lodging and signed a release. On

June 14, Paul Remmes and Robert Begin each signed a “Release and

Authorization” releasing and discharging claims against Mark Travel and

authorizing Mark Travel to charge their credit cards for the outstanding amounts

due for their resort accommodations: $16,926.15 for the Remmeses and $4,215.31

for the Begins.5 Mark Travel was able to rebook the plaintiffs’ lodging at the same

rate as the original booking.

   4
      The plaintiffs state that Mark Travel threatened to cancel the reservations if they did not sign
releases and pay for the rooms. Mark Travel states that it informed the plaintiffs that the resort
reservations had already been cancelled. Again, however, the distinction is not material.
   5
       The exact language of Paul Remmes’s release is as follows:

             I, Paul Remmes, the undersigned, agree to release and forever discharge The Mark
         Travel Corporation, its officers, directors, agents, representatives, employees, successors,
         assigns, and affiliate and subsidiary corporations from any and all claims, demands and
         actions of whatever kind and character.

            I previously made a travel reservation through a travel agency who I believe
         fraudulently took payment in cash and absconded with the money. I am now making a
         similar if not exact travel reservation through Funjet Vacations. I have attached a credit
         card authorization form and a copy of my Driver’s License each of which I have
         personally signed under my own free will. In addition, attached please find a personally
         signed Funjet Vacations Bill of Rights which I have read and agree to.

            I acknowledge that I have carefully read this statement. I am of legal age and am
         legally competent to execute this Release and do so of my own free will and accord.

Robert Begin signed a similar release. Each release was accompanied by a credit card authorization.
6

      [¶11] The Remmeses and the Begins each filed a complaint against Mark

Travel and Rogers in the Superior Court (York County) on January 30, 2013, and

April 18, 2013, respectively. Each complaint contained three counts. Count I

alleged a breach of contract by Mark Travel and Rogers, alleging that Rogers was

acting as Mark Travel’s agent when she collected payment for the travel

accommodations and provided to the plaintiffs airline tickets and documents

confirming their resort lodging, and that the plaintiffs had wrongfully been forced

to pay twice for their lodging. Each complaint sought damages for the amounts the

plaintiffs had paid directly to Mark Travel.

      [¶12] Count II alleged “economic duress,” asserting that Mark Travel was

responsible for the actions of its alleged agent, Rogers, and that the releases had

been signed under duress. Count II sought to void the releases.

      [¶13] Count III set out a private claim pursuant to the Maine Unfair Trade

Practices Act (UTPA), 5 M.R.S. §§ 205-A to 214 (2014), alleging that Mark

Travel violated the UTPA and that Mark Travel’s conduct was “egregious and

unconscionable and exceeds the bounds of human decency.”          Each complaint

sought damages under Count III for the amount the plaintiffs paid directly to Mark

Travel, plus attorney fees, costs, and punitive damages.

      [¶14] Mark Travel answered each complaint and stated four affirmative

defenses: failure to state a claim upon which relief may be granted, improper
                                                                                  7

venue, lack of personal jurisdiction over Mark Travel, and lack of subject matter

jurisdiction. The cases were transferred to the Business and Consumer Docket and

consolidated.

      [¶15] The plaintiffs filed a motion for summary judgment. Mark Travel

filed an opposition and two cross-motions for summary judgment. After a hearing,

the court entered an order denying the plaintiffs’ motion for summary judgment

and granting Mark Travel’s cross-motions for summary judgment.           As to the

breach of contract claims, the court noted that Mark Travel and the plaintiffs

entered into two contracts with each other: the first contract was created when

Mark Travel “accepted their booking and issued the [p]laintiffs travel documents

for their vacation, including lodging at [the resort],” and the second was created

when Mark Travel accepted payments directly from the plaintiffs and rebooked

their lodging. The court held that Mark Travel “rescinded the lodging portion of

the [first] contract for failure of consideration after determining that payment for

[the] lodging had been fraudulent[].” It went on to hold that Mark Travel was

entitled to rescind the contract because Rogers was not acting as Mark Travel’s

agent when she caused the failure of consideration, and therefore Mark Travel had

not breached the first contract.      The court determined that Rogers was the

plaintiffs’ agent, not Mark Travel’s agent, stating:
8

      there is nothing in the record indicating Mark Travel authorized
      [TravelWise] to issue tickets or collect payments on its behalf. In
      fact, after [TravelWise] purported to pay for [the p]laintiffs’ travel, it
      was Mark Travel that issued tickets and lodging vouchers to [the
      p]laintiffs. TravelWise never issued tickets or vouchers to the
      [p]laintiffs.

      [¶16] The court also concluded that Mark Travel was entitled to summary

judgment on the alternative ground that the releases executed by the plaintiffs

barred their claims. Additionally, the court entered summary judgment against the

plaintiffs on their claims for economic duress and violation of the UTPA.

      [¶17] Separately, the plaintiffs filed motions for default judgment against

Rogers. The court granted the plaintiffs’ motions for default judgment against

Rogers, entered a judgment of default against Rogers, and awarded the Begins

$4,215.31 with pre- and post-judgment interest and costs, and the Remmeses

$16,926.15 with pre- and post-judgment interest and costs. The plaintiffs then

brought this appeal from the judgment in favor of Mark Travel.

                              II. LEGAL ANALYSIS

      [¶18]    Summary judgment is appropriate when review of the parties’

statements of material facts and the record evidence to which the statements refer,

considered in the light most favorable to the nonprevailing party, demonstrates that

there is no genuine issue of material fact that is in dispute and the prevailing party
                                                                                  9

is entitled to judgment as a matter of law.       Budge v. Town of Millinocket,

2012 ME 122, ¶ 12, 55 A.3d 484; Beal, 2010 ME 20, ¶ 11, 989 A.2d 733.

      [¶19] When the material facts are not in dispute, we review de novo the trial

court’s interpretation and application of the relevant statutes and legal concepts.

See Blue Yonder, LLC v. State Tax Assessor, 2011 ME 49, ¶ 7, 17 A.3d 667.

“Cross motions for summary judgment neither alter the basic Rule 56 standard, nor

warrant the grant of summary judgment per se.” F.R. Carroll, Inc. v. TD Bank,

N.A., 2010 ME 115, ¶ 8, 8 A.3d 646.

      [¶20] As already noted, there is nothing in the record here indicating that a

contract or any agency relationship existed between Rogers or TravelWise and

Mark Travel. Although the question is one of first impression in Maine, other

courts have found that an agency relationship between a travel agent and a travel

provider, usually an airline, existed only when there was a written contractual

relationship.   See, e.g., State ex rel. Elson v. Koehr, 856 S.W.2d 57, 60-61

(Mo. 1993) (holding that a travel agent was an airline’s agent when there was a

written contract (“Certificate of Appointment”) between them); Rappa v. Am.

Airlines, Inc., 386 N.Y.S.2d 612, 613-15 (N.Y. Civ. Ct. 1976) (finding that a travel

agent was an airline’s agent when there was a sales agency agreement between

them). The Restatement (Third) of Agency notes:
10

      [A] travel intermediary who purchases a plane ticket for a prospective
      traveler acts as the prospective traveler’s agent in buying the ticket. If
      an airline authorizes the intermediary to issue tickets on its behalf and
      to collect and hold customer payments, the intermediary acts as the
      airline’s agent in so doing.

Restatement (Third) of Agency § 3.14 cmt. c (giving an example of a situation

where an agency relationship is ambiguous because “[t]he same actor may occupy

different roles at successive points in an ongoing interaction among the same

parties”); see also, e.g., Simpson v. Compagnie Nationale Air France,

248 N.E.2d 117, 120 (Ill. 1969) (characterizing a travel agent as a broker and

finding he was the agent of the traveler for whom he planned a specific vacation).

Here, under the principle articulated in comment c to section 3.14 of the

Restatement, the record establishes as a matter of law that Rogers was the

plaintiffs’ agent because she purchased the travel packages on their behalf and the

exception to this general rule did not apply.

      [¶21]   With no evidence of any contractual relationship, if any agency

relationship is to be demonstrated, it must be demonstrated on the theory of

ratification or apparent agency. “For ratification of an agent’s actions to occur, it

is necessary that all material facts be known by the principal.”              Perkins,
443 A.2d at 75. Here, Mark Travel did not learn of Rogers’s credit card fraud until

about the same time the plaintiffs learned of it in June of 2012. Therefore, Mark

Travel did not ratify Rogers’s fraudulent conduct.
                                                                                    11

      [¶22] A claim of apparent agency is proved by the following elements:

“(1) the defendant either intentionally or negligently held a person out as [its] agent

for services, (2) the plaintiff did in fact believe the person to be an agent of the

defendant, (3) the plaintiff relied on the defendant’s manifestation of agency, and

(4) the plaintiff’s reliance was justifiable.” See Levesque, 2012 ME 109, ¶ 10 n.7,

52 A.3d 933; see also Williams v. Inverness Corp., 664 A.2d 1244, 1246-47

(Me. 1995) (citing Restatement (Second) of the Law of Agency § 267 (1958)).

Apparent authority is authority that, although not actually granted, the principal

knowingly permits the agent to exercise or that the principal holds the agent out as

possessing. Williams, 664 A.2d at 1246. Apparent authority exists only when the

conduct of the principal leads a third party to believe that a given party is the

principal’s agent. Id.; Libby v. Concord Gen. Mut. Ins. Co., 452 A.2d 979, 982

(Me. 1982).

      [¶23] Here there is no evidence of conduct by Mark Travel that could have

led the plaintiffs to believe that Rogers was an agent for Mark Travel. The record

demonstrates, without dispute as to material fact, that the plaintiffs failed to

establish the necessary elements for a prima facie claim of apparent agency to get

that claim to a fact-finder. On the record presented, Rogers was acting as a travel

agent for the plaintiffs, not a sales representative for Mark Travel.

See Restatement (Third) of Agency § 3.14 cmt. c.
12

        [¶24] As the plaintiffs recognized at oral argument, the question of Rogers’s

agency is determinative of their claims, and thus we need not reach their other

arguments on appeal.

        The entry is:

                           Judgment affirmed.

On the briefs and at oral argument:

        James L. Audiffred, Esq., Saco, for appellants Paul Remmes,
        Holly Remmes, Robert Begin, and Lucy Begin

        Christine Kennedy-Jensen, Esq., Douglas, Denham, Buccina &
        Ernst, Portland, for appellee The Mark Travel Corporation

Business and Consumer Docket docket numbers CV-2013-29 & 34
FOR CLERK REFERENCE ONLY