Jonathan King, Et Al. v. Dean Chase

Appellants, partners in a partnership that was the sole member of an LLC, filed suit against the manager of the partnership for alleged breach of fiduciary duties related to the sale of commercial real estate on behalf of the LLC. The manager and his business (a partner in the partnership, and together with manager, Appellees) filed counterclaims against Appellants, alleging breach of contractual and statutory duties. The trial court dismissed Appellants’ lawsuit on grant of summary judgment, and we affirm that decision. Appellees’ remaining claim for misrepresentation by concealment against Appellants was tried to a jury, which returned a unanimous verdict in favor of Appellees. Prior to the jury trial, the Business Court found, as a matter of law, that Appellees were entitled to indemnification by the LLC, and we affirm that decision. Because Appellants’ tort of misrepresentation by concealment resulted in a premature distribution of the sale proceeds by the LLC, the LLC was unable to fully indemnify Appellees. As such, the Business Court entered judgment against Appellants for attorney’s fees and expenses as compensatory damages. We affirm.