Defendant accused of Fraudulent Inducement

A legal battle has unfolded over a contract dispute involving the installation of a silicone coating product on a shopping center roof, with accusations of fraudulent inducement at its core. Midlantic Builders VA, LLC filed a complaint against Mule-Hide Products Co., Inc. and American Builders & Contractors Supply Co., Inc. in the Circuit Court of the City of Portsmouth, alleging that they were misled into signing a contract under false pretenses regarding the qualifications of the contractor, Nigel Miles.

The case revolves around Midlantic’s decision to coat the roof of Academy Crossing Shopping Center in Portsmouth, Virginia, with a silicone product sold by Mule-Hide and distributed by ABCS. Midlantic claims that it was fraudulently induced to enter into this contract based on assurances that Miles was trained and certified to install the product. After a six-day bench trial, the circuit court ruled in favor of Midlantic, awarding them $149,674.03 in damages and later $445,000 in attorney fees. However, both parties challenged aspects of this judgment on appeal.

The appeals court affirmed part of the circuit court’s decision but found errors in how damages were calculated and reversed the award for attorney fees. The court determined that credible evidence supported Midlantic’s reliance on representations made by Mule-Hide’s representative about Miles’s training before finalizing their hiring decision. Yet, it found fault with the circuit court’s method for calculating damages using an unrecognized “half-replacement-cost” methodology instead of actual property values as required under Virginia law.

Midlantic sought compensatory damages claiming fraudulent inducement caused them financial harm beyond just replacing or repairing the defective work done by SPC (Subconsciously Precise Construction). They argued for recovery based on what they would have gained had all representations been true—a measure not properly applied according to appellate judges who called for recalculating these amounts upon remand.

Additionally troubling was awarding attorney fees without granting any equitable relief such as rescission or restitution—conditions necessary under Virginia precedent like Bershader v Prospect Development Company where courts can exercise discretion when awarding such costs only if equitable remedies are involved; thus making this fee grant improper per current standards set forth within state jurisprudence guidelines governing similar cases today.

Representing Mule-Hide were attorneys Jonathan R Mook & Chad E Kurtz from Ogletree Deakins Nash Smoak & Stewart PC along with Cozen O’Connor while George H Bowles represented Midlantic through Williams Mullen firm during proceedings overseen initially by Judge Johnny E Morrison then reviewed further upon appeal before Judges Malveaux Bernhard Senior Judge Humphreys presiding collectively over matters identified officially via Record Nos 1693-24-1/1825-24-1 respectively throughout course litigation timeline documented hereinabove.