Complete Text of Lawsuit filed on behalf of Martin Clarke
agaionst OPA and OPA Board Members on 4/13/2007
MARTIN D. CLARKE
855 Ocean Parkway
Berlin, Maryland 21801
Plaintiff,
v.
BOARD OF DIRECTORS OF OCEAN PINES ASSOCIATION, INC.
239 Ocean Parkway
Ocean Pines, Maryland 21811
and
TOM SANDUSKY
25 Wharf Court *
Ocean Pines, Maryland 21811
and
HEATHER COOK
352 Ocean Parkway *
Ocean Pines, Maryland 21811
and
RAY UNGER
11 Royal Oaks Drive
Ocean Pines, Maryland 21811
and
DAN STACHURSKI
60 Beacon Hill Road *
Ocean Pines, Maryland 21811
and
GLENN DUFFY
63 Battersea Road *
Ocean Pines, Maryland 21811
and
REID STERRETT
6 Customs Way *
Ocean Pines, Maryland 21811
and
BILL ZAWACKI
11 Tail of the Fox Drive *
Ocean Pines, Maryland 21811,
* Case No.: 23-C-07-000153
Defendants.
* * * * * * * * * * * * *
AMENDED PETITION FOR WRIT OF MANDAMUS, INJUNCTIVE RELIEF, AND TEMPORARY RESTRAINING ORDER AND COMPLAINT FOR BREACH OF FIDUCIARY DUTY, INTENTIONAL AND NEGLIGENT MISREPRESENTATION
Plaintiff, Martin D. Clarke by and through his counsel, David N. Honick and the Law Offices of David N. Honick, P.A., pursuant to Maryland Rules 15-701(d) and 2-341 hereby amends his civil action for Writs of Mandamus and a Preliminary Injunction, and states as follows:
The Parties
1. Plaintiff Martin D. Clarke (hereinafter referred to as “Plaintiff’) is a voting member in good standing of Ocean Pines Association, Inc; a member of the organization STOP – Stop Taxing Ocean Pines; and a resident of Worcester County, Maryland.
2. Ocean Pines Association, Inc. (hereinafter referred to as “Association”) is a Maryland corporation the operation of which is governed by its bylaws and the laws of the State of Maryland.
3. Defendant Board of Directors (hereinafter referred to as “Defendant Board”) of the Association consists of seven directors.
4. Defendants Tom Sandusky, Heather Cook, Ray Unger, Dan Stachurski, Glenn Duffy, Reid Sterrett, and Bill Zawacki (hereinafter collectively referred to as “Defendants Individual Board Directors” and incorporated into the term “Defendant Board” when used in the Factual Section of the Pleading) are the members of the Board of Directors.
Jurisdiction and Venue
5. This Court has subject matter jurisdiction pursuant to Maryland Code, Courts and Judicial Proceedings § 1-501.
6. This Court has personal jurisdiction over the Defendant Board pursuant to Maryland Code, Courts and Judicial Proceedings § 6-102.
7. This Court has personal jurisdiction over the Defendants Individual Board Members Board pursuant to Maryland Code, Courts and Judicial Proceedings § 6-102.
8. Venue is proper pursuant to Maryland Code, Courts and Judicial Proceedings § 6-201.
Facts
9. Pursuant to the Association’s Bylaws, Defendant Board possesses certain powers, including the power to “include in any annual charge amounts necessary to fund capital expenditures.” Section 5.14 (d) of Association’s Bylaws is incorporated herein and attached hereto as Exhibit A.
10. However, Defendant Board’s power to authorize expenditures and increase Association’s fees is not unlimited: “in the event any single capital expenditure exceeds twenty percent (20%) of the current income derived from annual charges, it shall require approval of the membership by a majority of the votes cast in a referendum vote of all voting members.” Section 5.14(d), Exhibit A.
11. In 1995, Defendant Board voted for a new community center to be built for five million three hundred thousand ($5,300,000.00) dollars. Said amount exceeded 20% of the Association’s revenues, and pursuant to Section 5.14(d) of the Association’s Bylaws, Defendant Board called a referendum. The Defendant’s proposal for a new center was defeated by a 71% majority of votes.
12. In 2001, Defendant Board again voted for a new community center. At that time, it called another referendum for “approximately 28,000 square feet built on the Sports Core property at a cost not to exceed $5 million.” Special Community Center Referendum Issue is incorporated herein and attached hereto as Exhibit B. That proposal was again defeated by 59% of Association’s members.
13. In 2005, Defendant Board again recommended to the Association’s members building a new community center (hereinafter referred to as “Center” and the “Project”).
14. Defendant Board “anticipated” that the Center would cost three million nine hundred ($3,900,000.00) dollars, which amount exceeded 20% of the five million twenty-six thousand nine hundred fifty-eight ($5,026,958.00) dollar budget derived from annual charges in the 2005. Ocean Pines Referendum Prospectus is incorporated herein and attached hereto as Exhibit C.
15. In accordance with Section 5.14(d) of the Association’s Bylaws, Defendant Board initiated a referendum to obtain Association’s members’ approval of the expenditure in August of 2005.
16. Defendant Board informed Plaintiff and other members of the Association that the Project would be “funded by the sale of 19 OPA-owned buildable lots within the community and the sale of the OPA-owned 2.8 acre commercial property”, and that the three million nine hundred ($3,900,000.00) dollar budget covered “all site preparation, the requisite permits and legal expenses, all construction materials, access from Cathell Road (only), a brick exterior, landscaping, furniture, equipment, 14% for contingencies, and, of course, labor.” Exhibit C.
17. When held, the referendum question read as follows: “Do you authorize the OPA Board of Directors to build this facility as described above, funded as stated?” Exhibit C.
18. On August 13, 2005, by only 214 member votes, which constituted 3% of all votes, the Association’s members approved the three million nine hundred ($3,900,000.00) dollar Project to be funded by the sale of the Association’s lots.
19. However, after the Association’s members voted on the Project and authorized Defendant Board to spend three million nine hundred ($3,900,000.00) dollars, within a year, the budget of the Project increased to five million three hundred seventy-two thousand seven hundred ninety-four ($5,372,794.00) dollars. Ocean Pines Community Center Budget Summary is incorporated herein and attached hereto as Exhibit D.
20. As of the date of filing of this Amendment to Petition, Defendant Board has not sold any of the Association’s nineteen (19) buildable lots or the 2.8 acre commercial lot, the proceeds from the sale of which were to fund the Project.
21. The one million four hundred seventy-two thousand seven hundred ninety-four ($1,472,794.00) dollar increase in the Center’s budget is greater than 20% of the 2006 budget.
22. As such, pursuant to Section 5.14(d) of the Association’s Bylaws, it requires a referendum vote of all voting members of the Association.
23. Defendant Board initiated no such referendum, but instead, continued to proceed with the Project in violation of the Association’s Bylaws.
24. In addition to Section 5.14(d) of the Association’s Bylaws that requires Defendant Board to hold a referendum to receive the Association’s members’ authorization for expenditures exceeding 20% of the annual budget, another section of the Association’s Bylaws – Section 4.09 requires Defendant Board to hold a hearing on referendum issues proposed by Association’s members in “a petition signed by voting members in good standing representing at least ten percent (10%) of the total voting units.” Exhibit A.
25. On or about January 3, 2007, in accordance with Section 4.09, nine hundred fifteen (915) of the Association’s members, comprising more than 10% of Association’s members, presented the Defendant Board with a petition for referendum on the increase of the Center’s budget. Exhibit E.
26. Defendant Board refused to call a hearing on the proposed referendum alleging that the petition lacked valid signatures. Letter of January 15, 2007 is incorporated herein and attached hereto as Exhibit F.
27. On or about January 31, 2007, Plaintiff filed this Petition for Writ of Mandamus and a Motion for Preliminary Injunction.
28. On or about February 28, 2007, Plaintiff became aware that Defendant Board intended to break ground and begin construction on the Community Center Project as early as March 1, 2007.
29. On or about March 2, 2007, realizing that there was no time left for a full adversary hearing on the propriety of issuance of Preliminary Injunction required by the Maryland law, Plaintiff filed a Motion for a Temporary Restraining Order asking this Honorable Court to issue an order mandating that Defendant Board cease any and all acts of construction, including but not limited to, grading or building, on the site of the Community Center project.
30. On or about March 9, 2007, this Honorable Court held a hearing on Plaintiff’s Motion for Temporary Restraining Order, at which hearing both Plaintiff’s and Defendant Board’s counsel were present.
31. On or about March 9, 2007, this Honorable Court entered a Temporary Restraining Order, whereby the Court ordered that Defendant Board cease any and all acts of construction for a period of ten (10) days to avoid irreparable, substantial and immediate harm to the Association’s members, including Plaintiff, by expending funds of the Association’s budget without the proper authorization by the Association’s members or a determination regarding the issue by this Court.
32. On or about March 13, 2007, Defendant Board announced that it was going to hold the referendum on the issue of the increased budget for the Community Center without awaiting this Court’s determination of Plaintiff’s Petition on its merits. Board of Directors’ News Announcement posted at www.oceanpines.org is incorporated herein and attached hereto as Exhibit G, p. 2.
33. The public hearing on the issue of the referendum is scheduled for April 14, 2007. Public Hearing Announcement posted at www.oceanpines.org is incorporated herein and attached hereto as Exhibit H.
34. Pursuant to Section 4.09 of the Association’s Bylaws, the referendum ballots are to be mailed to Association’s members within 15 days of the public meeting, or by April 29, 2007. Exhibit A.
35. Defendant Board intends to mail the referendum ballots on or about April 18, 2007. Defendant’s announcement posted www.oceanpines.orgis incorporated herein and attached hereto as Exhibit I.
36. On or about March 21, 2007, at a regular monthly meeting, Defendant Board approved the contents of referendum packet to be sent to all members of the Association. Exhibit I.
37. The referendum packet includes the ballot question, a cover letter and a list of commonly asked questions and Defendant Board’s answers. Exhibit I.
38. Defendant Board has made available for review the documents contained in the referendum packet on the official Association’s website. Exhibit I. A copy of Cover Letter, Commonly Asked Questions and the Ballot Question is incorporated herein and attached hereto as Exhibit J.
39. The Ballot Question reads as follows: “Do you approve the Ocean Pines Association continuing construction of the new Ocean Pines Community Center at a cost estimate of 5.4 million dollars?” Exhibit I.
40. It is Plaintiff’s belief that the Cover Letter and the Commonly Asked Questions contain some untruthful statements, including but not limited to the following:
(a) “The rationale [for this Court’s ‘unfortunate’ granting of temporary restraining order] was that project estimates established in 2005 did not reflect actual construction costs in 2007;”
(b) “You should be aware that the Association has incurred more than $ 900,000.00
in out of pocket expenses to begin work and meet our contractual obligations with the builders and professionals who have labored on this project;” [emphasis added]
(c) “We voted on this in 2005, why are we voting on this again? To relieve any concern about the community’s intent on constructing this facility and the method by which it will be paid for;”
(d) “If the community abandons the project, how much will the Association have paid to contractors and designers for preliminary work completed at the site? Approximately $900,000.00.” Exhibit J.
41. It is Plaintiff’s belief that Defendant Board purposefully exaggerated the amount of moneys expanded on the Community Center Project in an attempt to influence votes of members of the Association who may be persuaded to vote in the affirmative on the referendum question in hopes of avoiding wasting any more of the Association’s funds.
42. It is Plaintiff’s belief that the Cover Letter and the Commonly Asked Questions contain some contradictory information, including but not limited to the following:
(a) On the one hand, Defendant Board states in the Cover Letter and the Commonly Asked Questions that it had already incurred more than nine hundred thousand ($900,000.00) dollars in payments to contractors and designers for preliminary work completed at the site;
(b) On the other hand, Defendants states that “[t]he $325,000.00 already expended has been charged to the Future Facilities Reserve Account. While this account does not have to be reimbursed, these funds will no longer be available for future facilities. The cost of breaking the Community Center contracts are projected to be an additional $575,000. There are no funds budgeted to cover the expenditure other than liquidation of real estate. The most practical approach would be to pay the amount through undeveloped lot sales. Another option would be a one time assessment.” Exhibit J.
43. Although the Bylaws allow and even require that Defendant Board provide “an explanation of the proposal and a statement of position” when it proposes a referendum, the Bylaws do not authorize Defendants to hold a full-scale public relations campaign. Exhibit A, Section 4.09.
44. On April 5, 2007, Defendants sent a letter to some of the Association’s members urging them to vote in the affirmative in the upcoming referendum. A copy of Defendants’ Letter is incorporated herein and attached hereto as Exhibit K.
45. Specifically, in its letter, Defendant Board equates the new Community Center to the high “quality of life, and social and recreational experiences”, and “improve[d] [] property values and the community’s image”. Exhibit K.
46. Defendant Board further characterizes the efforts of those of the Association’s members who have objected to the procedural problems associated with the Community Center project, including Plaintiff, as a “threat” to the “vision for the Ocean Pines of tomorrow” that Defendant Board has allegedly been working long and hard to create. Exhibit K.
47. In its Spring Report, that is available on the Association’s official website and that was mailed to members of the Association, Defendant Board mentions its decision “to present a referendum question to the membership ratifying the 5.4 million dollar estimated cost of the project.” Ocean Pines Report is incorporated herein and attached hereto as Exhibit L.
48. Defendant Board’s failure to mention this litigation and choice of the word “ratifying” to identify the purpose of the referendum to those members of the Association who live outside of the Association makes the referendum look as a way to simply endorse Defendant Board’s engagement with the Community Center project.
49. On or about April 2, 2007, in an email Plaintiff requested from Defendant Board a breakdown of the moneys allegedly expanded on the Project as of the date of Defendant’s mailing of the Referendum Question, the Cover Letter and the Commonly Asked Questions. A copy of the April 2nd email is incorporated herein and attached hereto as Exhibit M.
50. On or about April 4, 2007, in an email Plaintiff requested from Defendant Board a breakdown of the moneys allegedly expanded on the Project as of the date of Defendant’s mailing of the Referendum Question, the Cover Letter and the Commonly Asked Questions. A copy of the April 4th email is incorporated herein and attached hereto as Exhibit N.
51. As of the date of Plaintiff’s filing of this Amended Petition and Complaint, Defendant Board has not produced a breakdown of the expenditures on the Project that show actual out of pocket expenditures consistent with Defendant Board’s claims made in the Cover Letter and Commonly Asked Questions included in Exhibit J.
52. Moreover, Defendant Board posted on the Association’s website a document entitled “Community Center Referendum – Dollars & Cents” in which it clearly indicates in a subsection showing “Funds Expended to Dated [sic.]” a total of $352,230.00, which is far lower than the out of pocket expenditures provided in the Cover Letter and the Commonly Asked Questions. “Community Center Referendum – Dollars & Cents” posted at www.oceanpines.org is attached hereto and incorporated herein as Exhibit O.
53. The posting on the Association’s website includes another subsection entitled “Additional Contractual Obligations” which clearly indicates that any further cost beyond $352,230.00 is projected in the future, is not yet out of pocket, and is speculation based on numerous variables that have not yet been determined. Exhibit O.
54. The resulting figure of $902,230.00 is not “out of pocket” or “incurred” as described ominously and dishonestly in the Cover Letter and Commonly Asked Questions. Exhibit J.
COUNT I
Writ of Mandamus – Referendum in Accordance with Section 5.14(d)
55. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 26.
56. The Association’s Bylaws require Defendant Board to hold a referendum vote on all capital expenditures exceeding 20% of income derived from annual charges.
57. Defendant Board failed to hold a referendum vote and increased the Center’s budget by one million four hundred seventy-two thousand seven hundred ninety-four ($1,472,794.00) dollars without the required approval of the Association’s members.
WHEREFORE, the Plaintiff requests that a Writ of Mandamus be issued by this Court ordering the Defendant Board to comply with Section 5.14(d) of the Association’s Bylaws and hold a referendum vote on the increase of the budget of the Community Center.
COUNT II
Writ of Mandamus – Hearing in Accordance with Section 4.09
58. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 26.
59. The Association’s Bylaws require Defendant Board to hold a hearing on a referendum issue proposed by more than 10% of voting members in good standing.
60. Defendant Board failed to hold a hearing on the referendum issue proposed by more than 10% of voting members in good standing.
WHEREFORE, the Plaintiff requests that a Writ of Mandamus be issued by this Court ordering the Defendant Board to comply with Section 4.09 of the Association’s Bylaws and hold a hearing on the referendum vote on the increase of the budget of the Community Center.
COUNT III
Preliminary Injunction
61. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 26.
62. The Association’s Bylaws require Defendant Board to hold a referendum vote on all capital expenditures exceeding 20% of income derived from annual charges.
63. Defendant Board failed to hold a referendum vote and increased the Center’s budget by one million four hundred seventy-two thousand seven hundred ninety-four ($1,472,794.00) dollars without the required approval of the Association’s members.
64. Defendant Board has commenced and continues to enter into binding contractual agreements for construction of the Center.
65. Defendant’s disbursement of Association’s funds without the required approval of the Association’s members is damaging Association’s budget.
66. Plaintiff will suffer immediate, substantial and irreparable injury, loss and damage before a full hearing can be held if Defendant Board does not stop construction of the project.
67. Injunctive relief from this Court is required to preserve the status quo until such time as the Court can determine the issues raised on the merits, and a referendum vote is held.
68. Plaintiff is likely to be successful on the merits of his claim.
69. Further, Plaintiff would suffer a greater degree harm and injury from the denial of the injunction than would be suffered by Defendant Board if the injunction is granted and the status quo is preserved.
WHEREFORE, the Plaintiff requests that this Court issue preliminary injunctive relief ordering the Defendant Board to immediately stop all further construction of the Community Center project until this matter is resolved; award attorneys fees to the Plaintiff; and for such other and further relief as the Court deems appropriate.
COUNT IV
Preliminary Injunction
70. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 54.
71. Defendant Board posted contradictory, misleading and deceitful information on the Association’s website in the Cover Letter and the Commonly Asked Questions Section.
72. Defendant Board intends to mail the Cover Letter and the Commonly Asked Questions Section to members of the Association.
73. The misleading and deceitful information, if distributed among the members of the Association, will cause damage to the Association’s members voting rights and the Association’s budget because Defendant’s distribution of the misleading and deceitful information is an attempt by Defendant Board to justify and proceed with its unlawful authorization of the 5.4 million dollar expenditure.
74. Plaintiff will suffer immediate, substantial and irreparable injury, loss and damage before a full hearing can be held if Defendant Board does not remove the misleading and deceitful Cover Letter and the Commonly Asked Questions from the Association’s official website at least until such time when this Court determines the validity of Defendant’s statements.
75. Injunctive relief from this Court is required to preserve the status quo until such time as the Court can determine the issues raised on their merits.
76. Plaintiff is likely to be successful on the merits of its claim.
77. Further, Plaintiff would suffer a greater degree harm and injury from the denial of the injunction than would be suffered by Defendant Board if the injunction is granted and the status quo is preserved.
WHEREFORE, the Plaintiff requests that this Court (1) issue preliminary injunctive relief ordering the Defendant Board
(a) to immediately remove all misleading and deceitful information about the Community Center Project, including but not limited to the Cover Letter and the Commonly Asked Questions, from the Association’s official website;
(b) to inform the members of the Association via the official website that the information regarding the moneys expended on the Community Center posted on the website prior to this Court’s order was not accurate;
(c) to hold a referendum on the issue of the increased budget of the Community Center Project under the oversight and supervision of this Court; and (2) award attorneys fees to the Plaintiff, and order such other and further relief as the Court deems appropriate.
COUNT V
Preliminary Injunction
78. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 54.
79. Defendant Board has approved a referendum packet for distribution by mail to all members of the Association on or about April 18, 2007.
80. The referendum packet contains contradictory, misleading and deceitful information.
81. The misleading and deceitful information, if distributed among the members of the Association, will cause damage to the Association’s members voting rights and the Association’s budget because Defendant Board’s distribution of the misleading and deceitful information is an attempt by Defendant Board to justify and proceed with its unlawful authorization of the 5.4 million dollar expenditure.
88. Plaintiff will suffer immediate, substantial and irreparable injury, loss and damage before a full hearing can be held if Defendant Board mails the misleading and deceitful Cover Letter and the Commonly Asked Questions to Association members before such time that this Court determines the validity of Defendant’s statements.
89. Injunctive relief from this Court is required to preserve the status quo until such time as the Court can determine the issues raised on their merits.
90. Plaintiff is likely to be successful on the merits of its claim.
91. Further, Plaintiff would suffer a greater degree harm and injury from the denial of the injunction than would be suffered by Defendant Board if the injunction is granted and the status quo is preserved.
WHEREFORE, the Plaintiff requests that this Court (1) issue preliminary injunctive relief ordering the Defendant Board
(a) to immediately remove all misleading and deceitful information about the Community Center Project, including but not limited to the Cover Letter and the Commonly Asked Questions, from the Association’s official website;
(b) to revise the contents of the referendum packet approved by Defendant Board on March 21, 2007;
(c) prior to posting and/or distribution of the revised referendum packet to members of the Association, seek and obtain this Court’s review and approval of the content of the referendum packet;
(d) inform the members of the Association via the official website that the information regarding the moneys expended on the Community Center posted on the website prior to this Court’s order was not accurate;
(e) to hold a referendum on the issue of the increased budget of the Community Center Project under the oversight and supervision of this Court; and (2) award attorneys fees to the Plaintiff, and order such other and further relief as the Court deems appropriate.
COUNT VI
Breach of Fiduciary Duty
92. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 54.
93. By virtue of having been elected the Board of Directors of the Association and managing the affairs of the Association, Defendant Board owes fiduciary duties to the members of the Association, including Plaintiff.
94. These fiduciary duties include the duty to abide by the Bylaws and Maryland Homeowners Association Act by properly holding a referendum seeking approval of the increased budget for the Community Center Project and by honestly administering the count of signatures on the petition submitted by Plaintiff to hold another referendum, and the duty to disclose material facts concerning the referendum on the increased budget of the Community Center.
95. Defendant Board breached these fiduciary duties by failing to hold a referendum as required in accordance with the Bylaws by virtue of the increased budget of the Community Center Project; by failing to hold a referendum in accordance with the Bylaws through the improper administration and oversight of the counting of signatures included in the petition submitted by Plaintiff; by failing to disclose truthful information, and by communicating knowingly false information concerning the circumstances surrounding the second referendum on the Community Center and the amounts of moneys expended on the Project as of the date of the issuance of this Court’s Temporary Restraining Order.
96. As a direct result of these breaches of fiduciary duties by Defendant Board, members of the Association, including Plaintiff, have sustained, and will continue to sustain, substantial damage and loss.
WHEREFORE, Plaintiff demands judgment against Defendant Individual Board Members in the amount of forty thousand six hundred twenty-five ($40,625.00) dollars which, if awarded, will be donated to the Association’s general fund; reasonable attorney’s fees; together with interest and costs, and such other and further relief as the Court deems proper.
COUNT VII
Breach of Fiduciary Duty
97. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 54.
98. By virtue of having been elected the Directors of the Association and managing the affairs of the Association, Defendants Individual Board Members owe fiduciary duties to the members of the Association, including Plaintiff.
99. These fiduciary duties include the duty to abide by the Bylaws and Maryland Homeowners Association Act by properly holding a referendum seeking approval of the increased budget for the Community Center Project and by honestly administering the count of signatures on the petition submitted by Plaintiff to hold another referendum, and the duty to disclose material facts concerning the referendum on the increased budget of the Community Center.
100. Defendants Individual Board Members breached these fiduciary duties by failing to hold a referendum as required in accordance with the Bylaws by virtue of the increased budget of the Community Center Project; by failing to hold a referendum in accordance with the Bylaws through the improper administration and oversight of the counting of signatures included in the petition submitted by Plaintiff; by failing to disclose truthful information, and by communicating knowingly false information concerning the circumstances surrounding the second referendum on the Community Center and the amounts of moneys expended on the Project as of the date of the issuance of this Court’s Temporary Restraining Order.
101. In their breach of fiduciary duties owed to the members of the Association, including Plaintiff, Defendants Individual Board Members deviated from their duties of directors of the Association.
102. Defendants Individual Board Members’ breach of fiduciary duties owed to the members of the Association, including Plaintiff, was willful, intentional and in bad faith.
103. As a direct result of these breaches of fiduciary duties by Defendants Individual Board Members, members of the Association, including Plaintiff, have sustained, and will continue to sustain, substantial damage and loss.
WHEREFORE, Plaintiff demands judgment against Defendant Individual Board Members in the amount of forty thousand six hundred twenty-five ($40,625.00) dollars, jointly and severally, in compensatory damages, eighty thousand ($80,000.00) dollars in punitive damages, jointly and severally, which amounts, if awarded, will be donated to the Association’s general fund; reasonable attorney’s fees; together with interest and costs, and such other and further relief as the Court deems proper.
COUNT VIII
Intentional Misrepresentation
103. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 54.
104. Defendant Board owed members of the Association, including Plaintiff, the duty to disclose material facts concerning the referendum on the increased budget of the Community Center.
105. Defendant Board intentionally made misrepresentations regarding the amounts of moneys expanded on the Community Center Project for the purpose of misleading members of Association and inducing their affirmative votes in order to persuade members of the Association to continue with the Project to avoid wasting any more of the Association’s funds.
106. The members of the Association, including Plaintiff, have relied and will rely upon Defendant Board’s representations and have a right to rely on Defendant Board’s representations in the full belief of their truth, and did, in fact, rely on these representations when they read the Cover Letter and the Commonly Asked Questions, and in formulating their ideas about the referendum and the Community Center Project.
107. As a direct result of the reliance by the members if the Association, including Plaintiff, on the false representations of Defendant Board, the members of the Association, including the Plaintiff, have sustained, and will continue to sustain, substantial damage and loss.
WHEREFORE, Plaintiff demands judgment against Defendant Individual Board Members in the amount of forty thousand six hundred twenty-five ($40,625.00) dollars which, if awarded, will be donated to the Association’s general fund; reasonable attorney’s fees; together with interest and costs, and such other and further relief as the Court deems proper.
COUNT IX
Negligent Misrepresentation
108. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 54.
109. Defendant Board owed members of the Association, including Plaintiff, the duty to disclose material facts concerning the referendum on the increased budget of the Community Center.
110. Defendant Board intended that its statements and representations concerning the referendum on the increased budget of the Community Center be acted on by the members of the Association, including Plaintiff, in formulating their ideas and preparing for casting their votes on the issue of the increased budget of the Community Center Project.
110. Defendant Board knew, or should have known that the members of the Association, including Plaintiff, would rely on these representations, which, if erroneous, would cause injury to the members of the Association, including Plaintiff.
112. The members of the Association, including Plaintiff, justifiably relied on these representations of Defendant Board in formulating their ideas and preparing for casting their votes on the issue of the increased budget of the Community Center Project.
113. As a direct result of the reliance of the members of the Association, including Plaintiff, on the negligent misrepresentations of Defendant, the members of the Association, including Plaintiff have sustained, and will continue to sustain, substantial damage and loss.
WHEREFORE, Plaintiff demands judgment against Defendant Individual Board Members in the amount of forty thousand six hundred twenty-five ($40,625.00) dollars which, if awarded, will be donated to the Association’s general fund; reasonable attorney’s fees; together with interest and costs, and such other and further relief as the Court deems proper.
COUNT X
Temporary Restraining Order
114. Plaintiff realleges, as if fully set forth, each and every allegation in paragraphs 1 through 54.
115. Since the Association’s Bylaws require that a referendum ballot be mailed to members of the Association within 15 days of the public hearing on the issue, and since Defendant Board intends to mail referendum packets on or about April 18, 2007, Plaintiff fears that there may not be sufficient time left for a full adversary hearing on the propriety of issuance of Preliminary Injunction required by Maryland law.
116. Allowing Defendant Board to proceed with distributing misleading and deceitful information without a determination by this Court of the issues raised on the merits of the Plaintiff’s Petition would result in immediate, substantial, and irreparable harm to the Plaintiff. Plaintiff’s Affidavit is incorporated herein and attached hereto as Exhibit P.
115. This Court’s immediate intervention is necessary to protect the Plaintiff from immediate, substantial, and irreparable harm.
116. Simultaneously with this Motion, Plaintiff is filing a Motion to Waive Bond Requirement.
WHEREFORE, Plaintiff Martin D. Clarke respectfully requests that this Honorable Court issue a Temporary Restraining Order in accordance with Maryland Rule 15-504 that requires the Defendant Board
(a) to immediately remove all misleading and deceitful information about the Community Center Project, including but not limited to the Cover Letter and the Commonly Asked Questions, from the Association’s official website;
(b) to inform the members of the Association via the official website that the information regarding the moneys expended on the Community Center posted on the website prior to this Court’s order was not accurate; and
(c) to hold a referendum on the issue of the increased budget of the Community Center Project under the oversight and supervision of this Court.
Respectfully submitted,
David N. Honick
Law Offices of David N. Honick, P.A.
107 Baptist St.
Salisbury, MD 21801
(410) 334-6397
Attorney for Plaintiff
CERTIFICATE OF SERVICE
I HEREBY CERTIFY, that on this 12th day of April, 2007, a copy of the foregoing Amended Petition for Writs of Mandamus, Preliminary Injunction and Temporary Restraining Order and Complaint for Breach of Fiduciary Duty, Intentional and Negligent Misrepresentation was mailed by first-class mail, postage prepaid to attorneys for Defendant Board of Directors, Paul Sweeney, Esq., Linowes and Blocher LLP, 7200 Wisconsin Avenue, Suite 800, Bethesda, Maryland 20814.
_________________________ David N. Honick
Uploaded: 4/13/2007
