2021 UT 21
IN THE
SUPREME COURT OF THE STATE OF UTAH
SHREE GANESH, LLC,
Appellant,
v.
WESTON LOGAN, INC. AND MATTHEW M. WESTON,
Appellees.
No. 20190475
Heard March 10, 2021
Filed June 17, 2021
On Direct Appeal
First District, Logan
The Honorable Kevin K. Allen
No. 170100051
Attorneys:
Troy L. Booher, J. Frederic Voros, Jr., Alexandra Mareschal, Robert
G. Crockett, Sarah C. Vaughn, Salt Lake City, for appellant
Brandon J. Baxter, Shawn P. Bailey, Matthew D. Lorz, Logan, for
appellees
CHIEF JUSTICE DURRANT authored the opinion of the Court, in
which ASSOCIATE CHIEF JUSTICE LEE, JUSTICE HIMONAS, JUSTICE
PEARCE, and JUSTICE PETERSEN joined.
CHIEF JUSTICE DURRANT, opinion of the Court:
Introduction
¶1 In this dispute arising out of the sale of hotel property (the
Property), Shree Ganesh, a limited liability corporation, brought a
number of contract and tort claims against Weston Logan, a
corporation, and Mathew Weston, an individual. Each claim stems
from Weston Logan‘s failure to inform Shree Ganesh about Weston
Logan‘s plans to develop a competing hotel across the street from
the Property. On summary judgment the district court dismissed
these claims because it concluded that, as a matter of law, Weston
SHREE GANESH V. WESTON LOGAN
Opinion of the Court
Logan did not owe Shree Ganesh any contractual or common-law
duties to disclose the information at issue. Because we conclude that
the contract between the parties is ambiguous as to Weston Logan‘s
disclosure obligations and because there remains a genuine dispute
as to material facts, we reverse the district court‘s dismissal of Shree
Ganesh‘s contract and tort claims against Weston Logan.
Background1
¶2 In January of 2016, Shree Ganesh, LLC entered into a
contract (the Purchase Agreement) with Weston Logan Inc. to
purchase Weston Logan‘s Best Western Inn (the Property) in Logan,
Utah. The Purchase Agreement described the Property to be sold as
―certain real property . . . located in the City of Logan . . . and more
particularly described as . . . [t]he 89 Unit Best Western Plus Weston
Inn located at 250 N. Main St.‖
¶3 Specifically included in the purchase price were all of
Weston Logan‘s ―leases, contracts, signage, billboards, all
transferable licenses or permits and all hotel inventory (consisting of
linens, paper goods, cleaning and operating supplies)‖ that were
―used in the operation of the Property.‖ Additionally, as part of the
Purchase Agreement, Weston Logan agreed to ―execute any
documents required to transfer to [Shree Ganesh] the telephone
numbers presently in use by the Hotel, the Best Western Plus
Franchise, along with any other business-related services.‖
¶4 The purchase agreement also contained a provision—
Section 8.1—governing Weston Logan‘s required disclosures. Under
Section 8.1, which is titled ―Books and Records,‖ Weston Logan was
required to disclose, in relevant part, ―[a]ll rental agreements, leases,
service contracts, insurance policies, latest tax bill(s) and other
written agreements, written code violations or other notices which
affect the property‖ and ―[t]he operating statements and Federal Tax
Returns of the Property.‖
¶5 Additionally, Section 12 of the Purchase Agreement
required Weston Logan to obtain Shree Ganesh‘s consent before
entering into new service or tenant contracts, making ―any material
1 Because, at the summary judgment stage, we construe all facts
and inferences in ―favor of the nonmoving party,‖ we recite the facts
in this case in the light most favorable to Shree Ganesh. USA Power,
LLC v. PacifiCorp, 2010 UT 31, ¶ 65,
235 P.3d 749.
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Opinion of the Court
changes to the Property, do[ing] any act, or enter[ing] into any
agreements of any kind that materially changes the value of the
Property.‖2
¶6 At some point after the purchase agreement was signed,
Dharmesh Ahir, Shree Ganesh‘s owner, sent an email to Wesley
Christensen, Weston Logan‘s real estate agent, requesting a price
reduction on the sale of the Property based on the fact that three new
hotels would soon enter the Logan hotel market. Mr. Christensen
responded by attaching a document entitled ―STR Supply Pipeline
for Utah‖ and stating, presumably in reference to the attached
document, that there was not a ―single property, not even in the
preplanning stage, ever mentioned in Logan.‖ Mr. Christensen then
stated that the requested price reduction was ―ridiculous‖ based on
Mr. Ahir‘s ―supply claim.‖
¶7 But during the time in which Weston Logan was in the
process of selling the Property to Shree Ganesh, it was also
developing another hotel in the Logan hotel market with MMR
Investments, LLC. Matthew Weston, a shareholder in both MMR
and Weston Logan, represented both companies in this development
and also represented Weston Logan in the sale of the Property to
Shree Ganesh.
¶8 As part of this development effort—in the same month the
parties entered into the Purchase Agreement—Weston Logan
purchased an existing Hampton Inn in North Logan with the intent
of potentially relocating the Hampton Inn to a new building
somewhere in the Logan area. Initially, Weston Logan intended to
build the new Hampton Inn with MMR at a site approximately 2.5
miles away from the Property. Shree Ganesh was aware of these
plans. But a few months after the purchase agreement was signed,
the City of Logan approached Mr. Weston with a proposal to build
the new hotel at a site directly across the street from the Property.
And before Weston Logan closed with Shree Ganesh, MMR entered
into an agreement with the City to purchase the land. Weston Logan
never disclosed any plans to build a competing hotel in this new
location.
¶9 After the sale of the Property closed, MMR and Weston
Logan merged, and Shree Ganesh learned about Weston Logan‘s
plans to build a competing hotel across the street. Because, according
2 (Emphasis added.)
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SHREE GANESH V. WESTON LOGAN
Opinion of the Court
to Shree Ganesh, the construction of a competing hotel across the
street significantly reduced the market value of the Property, Shree
Ganesh sued Weston Logan for its failure to disclose its plans to
develop the competing hotel.
¶10 In response, Weston Logan filed a motion for summary
judgment. In its motion, Weston Logan argued that it never
discussed partnering with MMR on the site across the street until
after Shree Ganesh and Weston Logan closed on the Property.
Weston Logan further argued that even if it had, it was not required
to disclose its plans to develop the competing hotel under the terms
of the Purchase Agreement or under the common law. The district
court agreed and granted summary judgment in favor of Weston
Logan on all Shree Ganesh‘s claims. Shree Ganesh appealed. We
have jurisdiction under Utah Code section 78A-3-102(3)(j).
Standard of Review
¶11 Shree Ganesh argues that the district court erred in granting
Weston Logan‘s motions for summary judgment on Shree Ganesh‘s
contract and tort claims. ―We review a grant of summary judgment
for correctness.‖3 ―We give no deference to the district court‘s legal
conclusions and consider whether the court correctly decided ‗that
no genuine issue of material fact existed.‘‖4 And we ―review the facts
in a light most favorable to the party against whom summary
judgment was granted.‖5
Analysis
¶12 While selling hotel property to Shree Ganesh, Weston Logan
failed to disclose any involvement it had in building a competing
hotel across the street. Based on this failure, Shree Ganesh brought a
number of contract and tort claims against Weston Logan. But, on
summary judgment, the district court dismissed all its claims. We
reverse.
¶13 Under rule 56 of the Utah Rules of Civil Procedure,
―[s]ummary judgment is appropriate [only] where ‗the moving party
shows that there is no genuine dispute as to any material fact and the
3 Heslop v. Bear River Mut. Ins. Co., 2017 UT 5, ¶ 15,
390 P.3d 314
(citation omitted).
4
Id. (citation omitted).
5
Id. (citation omitted).
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Opinion of the Court
moving party is entitled to judgment as a matter of law.‘‖6 So we
must review the district court‘s decision to ensure its legal
conclusions were correct, and we must review the record to ensure
no genuine and material factual disputes exist.
¶14 The court dismissed Shree Ganesh‘s contract claims because
the court interpreted the Purchase Agreement to not create a
contractual duty to disclose the information at issue. Similarly, the
court dismissed Shree Ganesh‘s tort claims because, based on the
court‘s view of the relevant facts in this case, Weston Logan did not
breach a common law duty when it failed to disclose the information
at issue. We reverse the district court on both counts.
¶15 First, we reverse the district court‘s dismissal of Shree
Ganesh‘s contract claims because the Purchase Agreement is
ambiguous as to whether Weston Logan owed Shree Ganesh a duty
to disclose.7 For this reason, the interpretation of the Purchase
Agreement is a question of fact for the fact-finder. Accordingly, the
district court erred in granting summary judgment on this issue.
¶16 Second, we reverse the district court‘s dismissal of Shree
Ganesh‘s tort claims because there remain genuine disputes of
material fact as to whether Weston Logan breached a common-law
duty owed to Shree Ganesh when Weston Logan failed to disclose
the information at issue.
I. We Reverse the District Court‘s Dismissal of Shree Ganesh‘s
Breach-of-Contract Claims Because the Purchase Agreement is
Ambiguous
¶17 Shree Ganesh argues that Weston Logan breached two
provisions of the Purchase Agreement by failing to disclose its plans
to build a competing hotel across the street from the Property. The
first provision it points to is Section 8.1. Section 8.1, entitled ―Books
and Records,‖ requires Weston Logan, in relevant part, to disclose
―[a]ll rental agreements, leases, service contracts, insurance policies,
6 Penunuri v. Sundance Partners, Ltd., 2017 UT 54, ¶ 14,
423 P.3d
1150 (citing UTAH R. CIV. P. 56).
7 Because we find summary judgment precluded based on the
Purchase Agreement‘s ambiguity, we do not address Weston
Logan‘s claims that it was not involved in the plans to build the hotel
across the street from the Property until after it closed on the
Property with Shree Ganesh.
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SHREE GANESH V. WESTON LOGAN
Opinion of the Court
latest tax bill(s) and other written agreements, written code violations
or other notices which affect the Property.‖8 Shree Ganesh argues that
the language ―other written agreements . . . which affect the
Property‖ obligated Weston Logan to disclose any written
agreements related to the development of the hotel property across
the street because those written agreements affected the market
value of the Property.
¶18 In contrast, the district court found that this provision
required disclosure only of ―agreements that involved, concerned, or
bound th[e] real property‖ being sold. Under this interpretation, the
Purchase Agreement did not require disclosure of documents having
an ―indirect impact on hotel market conditions or the future
profitability of the Best Western hotel business.‖
¶19 This interpretation is based primarily on the court‘s
understanding of how the Purchase Agreement defined the
―Property‖ being sold. According to the court, ―the term ‗the
Property,‘‖ as it is used in the Purchase Agreement, ―refers solely to
the real property that was sold‖ and not to the hotel as a business.
Although the court‘s interpretation of the term ―Property‖ may
ultimately be the one the parties intended, we disagree that the
term‘s meaning is unambiguous.
¶20 ―When we interpret a contract we first look at the plain
language [of the contract] to determine the parties‘ meaning and
intent.‖9 If the language of the ―contract is unambiguous, the parties‘
intentions are determined from the plain meaning of the contractual
language, and the contract may be interpreted as a matter of law.‖10
But if ―a contractual term or provision is ambiguous as to what the
parties intended,‖ such that genuine issues of material fact remain,
the moving party is not entitled to judgment as a matter of law.11
Summary judgment is therefore precluded and ―the question
becomes a question of fact to be determined by the fact-finder.‖12 A
―contractual term or provision is ambiguous if ‗it is capable of more
8 (Emphases added.)
9 Brady v. Park, 2019 UT 16, ¶ 53,
445 P.3d 395 (alteration in
original) (citation omitted) (internal quotation marks omitted).
10
Id. (citation omitted) (internal quotation marks omitted).
11
Id.
12
Id.
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Opinion of the Court
than one reasonable interpretation because of uncertain meanings of
terms, missing terms, or other facial deficiencies.‘‖13 In this case, the
term ―Property‖ could reasonably be interpreted in the narrow
manner proposed by the district court or in the broader manner
proposed by Shree Ganesh.
¶21 As the district court pointed out, the Purchase Agreement
defines the property as ―that certain real property . . . located in the
City of Logan, County of Cache County, State of Utah, and more
particularly described as follows: The 89 Unit Best Western Plus
Weston Inn located at 250 N. Main St., Logan Utah 84321 with Cache
County APN: 06-017-0008.‖ The court focused on the term ―certain
real property‖ to conclude that the meaning of ―Property‖ used
throughout the Purchase Agreement was clearly untethered from the
Property‘s market value as a site for the operation of a hotel
business.
¶22 But although the court is correct that the Purchase
Agreement refers to the Property as ―certain real property,‖ the court
overlooks the significance that the Purchase Agreement more
―particularly describe[s]‖ the Property as the ―89 Unit Best Western
Plus Weston Inn.‖ This suggests the parties were not concerned with
the transfer of real property alone, but with the transfer of real
property that would continue to be used for the operation of a Best
Western hotel business.
¶23 Other provisions of the Purchase Agreement support this
conclusion. For example, in describing what is being purchased, it
specifically includes any ―leases, contracts, signage, billboards, all
transferable licenses or permits and all hotel inventory (consisting of
linens, paper goods, cleaning and operating supplies) now in, owned
and used in the operation of the Property.‖14 By categorizing this list of
hotel-related items as items ―owned and used in the operation of the
Property,‖ the Purchase Agreement equates the ―Property‖ with a
hotel business. This again suggests that the parties‘ ultimate aim was
not merely to transfer real property, but to transfer property with
which Shree Ganesh could operate a successful hotel business.
¶24 Similarly, in Section 8.1(b), the Purchase Agreement requires
Weston Logan to disclose the ―operating statements and Federal Tax
Returns of the Property.‖ In addition to once again equating the term
13 Id. ¶ 54 (citation omitted).
14 (Emphasis added.)
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SHREE GANESH V. WESTON LOGAN
Opinion of the Court
―Property‖ with a functioning hotel business, this provision
expressly requires Weston Logan to disclose the important financial
documents related to the operation of that business.
¶25 As these examples from other provisions in the Purchase
Agreement demonstrate, the subject of the Purchase Agreement was
not solely real estate. Rather it included other things necessary or
helpful to Shree Ganesh‘s continued operation of a Best Western
hotel franchise on the Property. With this in mind, we conclude that
it is reasonable to interpret the language ―other written agreements
. . . which affect the Property‖ contained in Section 8.1 to require
disclosure of written agreements that would affect the continued
operation of the hotel business. Accordingly, the district court erred
in concluding that the meaning of this provision was unambiguous.
¶26 Shree Ganesh also argues that Weston Logan violated
Section 12 of the Purchase Agreement. Section 12 states that after
Shree Ganesh had removed certain contingencies (thereby nullifying
the disclosure requirements in Section 8.1), Weston Logan would be
prohibited from ―enter[ing] into any new service or tenant contracts
that cannot be canceled with 30 days notice and without penalty‖
and from ―mak[ing] any material changes to the Property, do[ing]
any act, or enter[ing] into any agreements of any kind that materially
changes the value of the Property or the rights of [Shree Ganesh] as they
relate to the Property,‖ unless Weston Logan first obtains Shree
Ganesh‘s written consent.15
¶27 As it did with Shree Ganesh‘s claim under Section 8.1, the
district court dismissed this claim based on its interpretation of the
term ―the Property,‖ concluding that Weston Logan‘s ―obligation ‗to
not make any material changes to the Property‘ simply mean[t] that
it could not make material changes to the real property.‖ And it
concluded that the ―prohibition against ‗any act, or . . . agreements of
any kind that materially changes the value of the Property or the rights
. . . relate[d] to the Property‘‖ meant that Weston Logan ―could not,
without [Shree Ganesh‘s] written consent, engage in any actions or
enter into agreements that materially changed the value of the Best
Western real property or [Shree Ganesh‘s] rights related to that real
property.‖
¶28 For the same reason we rejected the district court‘s
conclusion under Section 8.1, we reject it here. The parties clearly
15 (Emphasis added.)
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Opinion of the Court
intended to transfer what was necessary to continue the operation of
the Property as a hotel business. And based on this understanding,
we conclude it is reasonable to interpret Section 12 as prohibiting
Weston Logan from engaging in acts that would harm Shree
Ganesh‘s operation of that business. In fact, Section 12 provides
additional support for this interpretation by expressly prohibiting
actions that would materially change ―the value of the Property.‖16
Accordingly, the court erred in treating this provision as
unambiguous.
¶29 Because the district court erred in concluding that Sections
8.1 and 12 are susceptible to only one reasonable interpretation, we
reverse the district court‘s dismissal of Shree Ganesh‘s contract
claims against Weston Logan.17
16 (Emphasis added.) We note that even under the district court‘s
accepted meaning of the term ―Property,‖ the development of the
hotel across the street could reasonably affect the value of the Best
Western real property.
17 Shree Ganesh also requests that we reverse the dismissal of its
contract claims against Matthew Weston in his individual capacity.
The district court dismissed these claims on summary judgment
because, based on its interpretation of the Purchase Agreement,
Matthew Weston had not made any personal guarantees or
otherwise agreed to be bound in his individual capacity when he
signed on behalf of Weston Logan. Upon review of the Purchase
Agreement, we agree with the district court. We find the Purchase
Agreement unambiguous on this issue, with no genuine issue of
material fact remaining to preclude summary judgment. The
Purchase Agreement specifically identifies the ―Seller‖ as ―Weston
Logan, Inc.‖ And Mathew Weston clearly signed on the line marked
―Seller.‖ And, contrary to what Shree Ganesh argues, this conclusion
is not altered by a provision purporting to bind ―heirs, successors,
agents, representatives and assigns of the parties.‖ That provision
would bind agents only in their role as agents of the contract
parties—it does not make the agents parties to the Purchase
Agreement nor does it subject them to personal liability.
Additionally, Shree Ganesh asks us to reverse the dismissal of its
claim under the implied covenant of good faith and fair dealing.
According to Shree Ganesh, even if the Purchase Agreement did not
require disclosure, the covenant of good faith and fair dealing did.
(Continued)
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SHREE GANESH V. WESTON LOGAN
Opinion of the Court
II. We Reverse the District Court‘s Dismissal of Shree Ganesh‘s Tort
Claims Because There Remain Unresolved Issues of Material Fact
¶30 Shree Ganesh also argues that Weston Logan and Mr.
Weston committed the tort of fraudulent nondisclosure by failing to
disclose information about their plans to build a competing hotel
across the street. To prevail on a claim for fraudulent nondisclosure,
a plaintiff must prove three elements: ―(1) the defendant had a legal
duty to communicate information, (2) the defendant knew of the
information . . . , and (3) the nondisclosed information was
material.‖18 The district court dismissed Shree Ganesh‘s
nondisclosure claim because it concluded that Weston Logan did not
breach a legal duty to communicate the information at issue. But,
because we conclude that two genuine disputes of fact related to this
claim exist, we reverse this determination.
¶31 First, there is a genuine dispute as to whether Weston Logan
breached a common-law duty to disclose information about a
competing hotel across the street. As the district court noted, we
recognized a duty to disclose ―material elements‖ of a property in
Ong International (U.S.A.), Inc. v. 11th Avenue Corp.19 In that case we
stated that ―a seller [of real property] has a duty to represent fairly
and accurately the material elements of property sold when such
elements are not easily ascertainable by the buyer and materially
affect the value of the property.‖20 Although the district court cited
our decision in Ong, the court concluded that, as a matter of law,
information about the development of a competing hotel across the
street could not constitute a material element of the Property. This is
incorrect.
Because any determination on Shree Ganesh‘s implied-covenant
claim would be premature in light of our determination regarding
Shree Ganesh‘s contract claims, we do not reach the merits of this
argument. But, because the district court on remand may want to
revisit its implied-covenant decision in connection with Shree
Ganesh‘s contract claims, we also remand for a reconsideration of
this issue.
18Anderson v. Kriser, 2011 UT 66, ¶ 22,
266 P.3d 819 (emphases
omitted) (citation omitted).
19
850 P.2d 447, 454 (Utah 1993).
20
Id. (emphasis added).
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Opinion of the Court
¶32 In Yazd v. Woodside Homes Corp., we explained that to ―be
material, the information must be ‗important.‘‖21 And we explained
that ―[i]mportance, in turn, can be gauged by the degree to which the
information could be expected to influence the judgment of a person
buying property or assenting to a particular purchase price.‖22 In this
case, Shree Ganesh provided testimony that information about a
competing hotel across the street would have been an important
factor in its decision to purchase the Property. So to the extent the
district court was suggesting the undisclosed information in this case
was indisputably immaterial, we disagree.
¶33 We also disagree with the district court‘s assertion that the
undisclosed information could not constitute an ―element‖ of the
Property. Under our case law, the type of information at issue in this
case may constitute an element of real property triggering a tort duty
to disclose. For example, in Elder v. Clawson we recognized that the
failure to disclose information that the Agricultural Department had
quarantined farm property because of the existence of a noxious
weed could form the basis of a fraudulent nondisclosure claim.23 In
that case, the buyer knew of the existence of the weed at the time of
the purchase, but the seller did not inform the buyer that the
property was quarantined.24 Based on these facts, we concluded that
the seller had committed fraud. So in that case the material element
was not the physical defect on the land—the noxious weed. Rather,
the material defect was the information affecting the viability of the
―economic operation‖ of the farm—the quarantine imposed by the
Agricultural Department.25
¶34 Similarly, in Ong, we cited Moschelle v. Hulse, a Montana
case in which the Montana Supreme Court determined that the
withholding of information related to a commercial property‘s
―probable business earnings‖ was deemed to be fraudulent.26 In a
parenthetical description of the Moschelle decision, we described the
21 2006 UT 47, ¶ 34,
143 P.3d 283.
22
Id.
23
384 P.2d 802, 803–05 (Utah 1963).
24
Id. at 803.
25
Id.
26See Moschelle v. Hulse,
622 P.2d 155, 159 (Mont. 1980); see also
Ong,
850 P.2d at 454 n.24 (citing Moschelle,
622 P.2d at 159).
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Opinion of the Court
case as standing for the proposition that ―creating [a] false
impression as to [a] matter of vital importance to [the] purchaser
amounted to fraud.‖27 In so doing, we equated the phrase ―material
element‖ with the phrase ―matter of vital importance‖ and we
suggested that matters of vital importance could encompass
information about a commercial property‘s ―probable business
earnings.‖
¶35 As our discussion of these cases illustrates, our definition of
a ―material element‖ of property is not limited to physical defects or
conditions on the land. Rather, it encompasses any matter or
information that would have been an important factor in a buyer‘s
decision to purchase the real estate. Under this definition,
information that could substantially decrease the Property‘s market
value or future economic potential could be deemed (based on the
specific facts in the case) a material element. Accordingly, there
exists a genuine dispute of material fact as to whether Weston Logan
breached its duty to disclose ―material elements‖ of the Property
when it withheld information about its plans to build a competing
hotel across the street.
¶36 Second, there also exists a genuine dispute of material fact
as to whether Weston Logan breached its duty to clarify potentially
misleading statements made by its real estate agent. A month or so
before the original closing date, Dharmesh Ahir, Shree Ganesh‘s
owner, sent an email to Wesley Christensen, Weston Logan‘s real
estate agent, requesting a price reduction based on the fact that three
new hotels would soon enter the Logan market. Mr. Christensen
responded by attaching a document titled ―STR Supply Pipeline for
Utah‖ and stating, presumably in reference to the attached
document, that there was not a ―single property, not even in the
preplanning stage, ever mentioned in Logan.‖ Mr. Christensen then
stated that the requested price reduction was ―ridiculous‖ based on
Mr. Ahir‘s ―supply claim.‖ Shree Ganesh argues that Weston Logan
committed the tort of fraudulent or negligent nondisclosure because
it failed to clarify Mr. Christensen‘s misleading statement by failing
to disclose additional information about Weston Logan‘s hotel
development plans.
¶37 In addressing this claim, the district court noted, correctly,
that where a person makes an affirmative statement, that person has
27 Id.
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a common-law duty to disclose all material facts necessary to
prevent that statement from being misleading.28 Notwithstanding
this common-law duty, the district court dismissed Shree Ganesh‘s
claim because, in the court‘s view, Mr. Christensen‘s statement was
not a misleading statement necessitating the disclosure of additional,
clarifying information.
¶38 According to the court, the statement was ―an accurate
representation of an attached STR report, which did not reference
any hotels in the pre-planning stage.‖ Although Shree Ganesh
concedes that Mr. Christensen‘s comments about the report were
accurate, Shree Ganesh argues ―it is clear that the intention of the
email—particularly the ‗ridiculous‘ comment—was to assure Shree
Ganesh that there were, in fact, no hotels being planned in the near
future, not just that none appeared in the STR report.‖ We conclude
that this creates a genuine dispute as to a material fact.
¶39 Mr. Christensen made the statement at issue in response to
Mr. Ahir‘s email inquiring about competing hotel developments in
the area. In that email, Mr. Ahir did not ask Mr. Christensen about
what was shown in the STR report. Instead, Mr. Ahir‘s focus was on
whether other hotels were in fact being developed in the area. With
this context in mind, it is reasonable to conclude that
Mr. Christensen‘s partial statement, which did not directly respond
to Mr. Ahir‘s core concern, was misleading absent the disclosure of
other, clarifying information. Accordingly, we conclude there exists
a genuine dispute as to whether Weston Logan breached its duty to
clarify a potentially misleading and material statement made by its
agent concerning the Property.
¶40 Because genuine disputes exist as to whether Weston Logan
breached its duties to disclose ―material elements‖ about the
Property and to correct misleading affirmative statements, we
reverse the district court‘s grant of summary judgment on Shree
Ganesh‘s tort claims.29
28First Sec. Bank of Utah N.A. v. Banberry Dev. Corp., 786 P.2d 1326,
1330–31 (Utah 1990) (recognizing a common law duty to disclose
matters ―that [one party] knows to be necessary to prevent [the
party‘s] partial or ambiguous statement of the facts from being
misleading‖) (citing Restatement (Second) of Torts § 551, 119 (1977)).
29 Shree Ganesh also argues that we should reverse the district
court‘s denial of Shree Ganesh‘s motion to amend its complaint to
(Continued)
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Opinion of the Court
Conclusion
¶41 Because we conclude that the Purchase Agreement between
the parties is ambiguous as to Weston Logan‘s disclosure obligations
and because there remains a genuine dispute as to material facts
relevant to Shree Ganesh‘s tort claims, we reverse the district court‘s
dismissal of Shree Ganesh‘s contract and tort claims against Weston
Logan.
add conspiracy claims against several new defendants. Because the
district court may want to revisit this decision on remand in
connection with its determinations as to Shree Ganesh‘s other claims,
we also remand for a reconsideration of the denial of the motion to
amend. But in so doing, we make no decision regarding the merits of
the district court‘s decision on this issue. Rather our decision is
motivated only by the fact that—in light of our other
determinations—a decision on the issue at this time would be
premature.
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