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Re/Max Relocation, Inc. v. Valero Services, Inc.

United States District Court, D. Colorado

August 26, 2014

RE/MAX Relocation, Inc., Plaintiff,
v.
VALERO SERVICES, INC., Defendant.

MEMORANDUM OPINION AND ORDER

RICHARD P. MATSCH, Senior District Judge.

In this civil action, Plaintiff RE/MAX Relocation, Inc. ("RMR") claims that Defendant Valero Services, Inc. breached the parties' Agreement for Relocation Services by failing to indemnify RMR for attorneys' fees and costs RMR incurred in defending a lawsuit in California state court. Valero concedes that the Agreement's indemnification provision applies to RMR's defense of the California litigation. [Doc. 19 at 4.] Valero's only contention is that RMR's claim is barred by the applicable statute of limitations. Both sides have moved for summary judgment on the timeliness issue. [Docs. 15 & 18.]

A. Undisputed Facts

On January 28, 1998, RMR and Valero entered into an Agreement for Relocation Services ("the Agreement") pursuant to which Valero paid RMR to provide relocation services to Valero employees who were relocating due to a reassignment within the company. [Doc. 15, Statement of Uncontested Material Facts ("SUMF") ¶ 1.] Those services included helping the relocating Valero employee sell his home. The Agreement contains an indemnification provision, which states:

[Valero] shall indemnify and hold harmless RE/MAX and its successors, assigns, officers, directors, employees and agents from any and all claims, liability, losses, damages, costs and expenses (including attorneys' fees) (except to the extent the same are caused by the negligent or intentional acts or omissions of RE/MAX) which RE/MAX may sustain, suffer or be put to as a result of carrying out its obligations under this Agreement, including but not limited to, those arising out of or in any way related to (a) the Contract of Sale or any other agreements or transactions contemplated hereby; (b) the purchase or subsequent sale by RE/MAX of any Home or Special Property; (c) the fraud, deceit or misrepresentation of [the relocating employee] and (d) claims relating to title, encumbrances, zoning, physical or structural condition of any Home or Special Property or encroachments of any kind whatsoever. Notwithstanding the foregoing, in no event shall [Valero] be required to indemnify and hold harmless RE/MAX and its successors, assigns, officers, directors, employees or agents with respect to any claim, liability, loss, damage, cost or expense (including reasonable attorneys' fees) which RE/MAX may sustain, suffer or be put to as a result of the failure of any RE/MAX employee to perform his or her duties, as a result of negligence on the part of any RE/MAX employee, or as a result of the failure on the part of RE/MAX or any RE/MAX employee to exercise that standard of care customary for persons and firms of similar responsibility and employment in the corporate relocation business.

[Doc. 15, Ex. 1 § 6.A.] The indemnification obligation in Section 6 is contingent on:

(i) [Valero] receiving prompt notice of all claims, liabilities, losses, damages, costs and expenses asserted against [RMR]; (ii) [Valero] controlling the defense using counsel of [Valero's] choice and (iii) [RMR] fully cooperating with [Valero] in such defense.

[Id.]

In 2005, pursuant to the Agreement, Valero engaged RMR to provide relocation services for a Valero employee, Mr. McCardle, and his wife. RMR helped the McCardles sell their condominium in Solano County, California. [SUMF ¶ 6.] The sale occurred in 2005.

On or about September 28, 2009, the purchaser of the McCardles' condo, Thomas Oetjen, filed a lawsuit against the McCardles in Solano County Superior Court ("the California Litigation"). RMR was not named as a defendant. Oetjen filed his first amended complaint on April 12, 2010, which added RMR as a defendant and brought claims for breach of contract, breach of a statutory duty of disclosure, and fraudulent concealment against the McCardles, RMR, and John Jackson, the real estate agent for the McCardles. [SUMF ¶¶ 7-9.] Oetjen alleged that all of the defendants failed to investigate the condition of the property purchased, and failed to disclose to him the defects in the property's condition before the sale occurred. Specifically, Oetjen alleged that:

[The McCardles] and [RMR] and their agent John P. Jackson breached the Purchase Agreement by failing to disclose material and important information regarding the condition of the real property that was within these defendants [sic] knowledge....
...
[Jackson] and [RMR] participated in [the McCardles'] breach of the Purchase Contract by failing to prevent sellers' misleading disclosures and failing to disclose information that they knew or should have know [sic].
...
[The McCardles], [RMR] and [John Jackson] owed plaintiff a duty under California Civil Code sections 1102 et. seq. to inspect and to disclose fully and fairly all facts that materially affect or related to the condition of the real property and to disclose truthful and complete, rather than misleading, information.
...
[RMR] and [John Jackson] failed to undertake a sufficient inquiry of [the McCardles] as to the condition of the property or to undertake a reasonably competent and diligent investigation of the real property to determine whether ...

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