Greenfield v. Heckenbach

SALMON, J. In late 1997, Robert D. Greenfield and his wife, Marguerite Greenfield (“the Greenfields”), bought, for 1.6 million dollars, a 24.5 acre improved parcel of land located in Talbot County, Maryland. The sellers of the property were Udo Heckenbach and his wife, Cornelia Heckenbach (“the sellers” or “the Heckenbachs”). Approximately twenty-one months after the purchase of the property, the Greenfields sued the Hecken ¹¹³ bachs claiming that, prior to the sale, the Heckenbaehs either fraudulently or negligently misrepresented their development plans for an adjoining parcel of land—which the Heckenbaehs also owned. According to the complaint, the misrepresentations by the Heckenbaehs induced the Greenfields to make the 1.6 million dollar purchase.

The two main counts in the Greenfields’ complaint were tort claims for which the plaintiffs sought damages or, alternatively, equitable relief (injunction). The Greenfields did not allege that the Heckenbaehs breached the contract for the sale of the land. One of the primary contentions advanced by the Heckenbaehs in the lower court was that the parol evidence rule acted as a complete bar to the introduction into evidence of any precontractual representations made by the sellers that would add to or vary the written sales contract. This contention was accepted by the trial judge and ultimately led to his grant of summary judgment in favor of the Heckenbaehs as to the two main counts.

The exclusionary effect, if any, of the parol evidence rule in a tort action often presents thorny issues. See Weisman v. Connors, 312 Md. 428 , 456-57 n. 4, 540 A.2d 783 (1988). 1 In ¹¹⁴ the case at hand, we are called upon to resolve some of those issues. Broadly speaking, the main question presented is whether the trial judge was legally correct in granting the Heckenbachs’ motion for summary judgment as to Count I (fraud) and Count II (negligent misrepresentation). In view of the nature of that broad question, the facts set forth in Part I 'are presented in the light most favorable to the Greenfields, the non-prevailing party below.

See Md. Rule 2-501; see also Jones v. Mid-Atlantic Funding Co., 362 Md. 661, 676 , 766 A.2d 617 (2001). It should be noted, however, that many of these facts are disputed by the Heckenbachs. I. In 1997, the Heckenbachs owned and resided at “Windrush Farm” located in Royal Oak, Maryland. The Heckenbachs wanted to sell Windrush Farm and with that goal in mind listed the property with a real estate firm known as Sharp, Critchlow, Nash & Crouch (“SCN & C”).

Their asking price was $1,950,000. SCN & C prepared a brochure that included the following description of the property and its environs: [A]n area of large farms and estates known as Deep Neck, “Windrush Farm” will take you back in time with its meticulously restored and renovated 19th century farm house, guest house, horse stable, pump house and numerous other dependencies including a tenant house, pool and pool house, tennis court, three-bay garage, and bam. A recent visitor affectionately described this property as being like “a little village,” and indeed it does recall the age of self-sufficient farms and southern plantations. ¹¹⁵ Complimenting this idyllic setting you will find a fruit orchard, fenced vegetable garden, rose and perennial gardens, pasture, woodland and according to a local tree and landscape expert, “perhaps the finest variety of trees on any one estate in Talbot County.” The main house, a classic, vernacular Eastern Shore farm house (stately and at the same time understated and unpretentious), offers over 4,500 sq. ft. of living space and provides incredible natural and unspoiled southwesterly views across Irish Creek and the Choptank River from nearly every room.... [2] (Emphasis added.) Windrush Farm is adjoined by a twenty-two acre, unimproved parcel of land known as “Windfield Farm.” That farm is also owned by the Heckenbachs. In July 1997, the Greenfields learned from Francis Maffitt, a realtor employed by SCN & C, that Windrush Farm was available for purchase.

Cornelia Heckenbach, one of the sellers, was the listing agent for the property and an agent of SCN & C. The Greenfields had direct negotiations with the Heckenbachs about the purchase of Windrush Farm, starting in late July or early August 1997. During these discussions, the Heckenbachs told the Greenfields that they owned Windfield Farm and that they intended to construct a main house, garage/apartment, pool, and timber pier on that land. Because Windfield Farm was situated between Windrush Farm and Irish Creek, the Greenfields asked the Heckenbachs how this building project would impact the water view from Windrush Farm. According to the Greenfields, the Heckenbachs told them that they would “not construct anything on [Wind-field Farm] ... that would obstruct clear view [from Win- ¹¹⁶ finish Farm] across Irish Creek and the Choptank River or significantly block the view down Irish Creek.” 3 In addition to the more general representation that they would not “construct anything” on Windfield Farm that would obstruct the purchasers’ clear view across Irish Creek and the Choptank River, or significantly block the view from Windrush Farm down Irish Creek, the Heckenbachs made the following more specific representations: A. [The Windfield Farm’s] pier would be located slightly east of the middle of the south-facing water frontage on [Windfield Farm so] that it would not even be visible from [the Windrush Farm property]; B. [The main house to be constructed on Windfield Farm] would be “smaller” than the existing main house on the [Windrush Farm] [property; and C. [Windfield Farm’s main] house would be located where a grove of trees was then located on the eastern side of [the Windfield Farm] [property so as to avoid significantly interfering with [the Greenfields’] water, view down Irish Creek.

The Heckenbachs representations concerning their construction plans were a material factor in persuading the Greenfields to offer to purchase Windrush Farm. The offer was accepted on August 11, 1997. The contract of sale was in the form of a multi-page printed contract with four printed ¹¹⁷ addenda, a partially typed and partially handwritten addendum, and numerous disclosure statements. The printed forms contained several handwritten changes and deletions made by the Greenfields.

One of the provisions in the contract was a general form integration [or merger] clause that provided: This Contract and any Addenda thereto contain the final and entire agreement between the parties, and neither they nor their agents shall be bound by any terms[,] conditions, statements, warranties or representations, oral or written, not herein contained. In the written contract, no mention was made of the representations by the Heckenbachs regarding their construction plans for Windfield Farm or the promise by them to preserve the buyers’ water view across Irish Creek. The closing for the sale of Windrush Farm was held on December 15, 1997. Sometime before closing (the exact date is not shown in the record), the Heckenbachs poured the foundation for the main house on Windfield Farm and built up the walls of the structure to a height approximately three feet above ground.

Additionally, prior to closing, the Heckenbachs staked out the location of the wood pier. Neither the foundation for the main house nor the place where the pier was staked out was where the Heckenbachs had represented it would be in their pre-contract conversations with the Green-fields. The Greenfields, however, did not observe the house foundation or the area where the pier had been staked out prior to closing. On December 16, 1997, which was the day following closing, the Greenfields went to Florida, where they stayed until approximately April 15, 1998.

In the four-month interim during which the Greenfields were absent from Talbot County, the Heckenbachs constructed a pier that jutted out 170 feet from their Windfield Farm property. The pier was approximately 150 feet west of the location where the Heckenbachs had represented that it would be situated. The difference in location was material to the Greenfields because, if the pier had been located as promised, it “would not [have been] visible ¹¹⁸ from the main house on Windrush Farm.” As located, it “destroy[ed] the otherwise unobstructed water view ... [from Windrush Farm] across Irish Creek....” Construction of the main house on Windfield Farm proceeded with alacrity, starting in April 1998. By the end of June 1998, the entire main house and its screened porch were framed, the house was under roof, and the doors were installed.

The main house, however, was not located “in the grove of trees on the eastern side of’ Windfield Farm. Instead, it was situated “approximately one hundred feet (100') west of the grove of trees.” Moreover, the main house was much larger than the existing main house on Windrush Farm. Because of its size and location, the Heckenbachs’ new home “substantially impaired] the [Greenfields’] water view ... from the main residence on Windrush Farm.” Sometime between June 20 and June 30, 1998, the Heckenbachs hosted a party on Windfield Farm, which the Green-fields attended. The party was held outside, and the Heckenbachs’ guests, including the Greenfields, were given a tour of the new main house.

Despite knowledge that the pier and main house were not constructed where the Heckenbachs said they would be constructed, the Greenfields made no protest to the Heckenbachs. Their reason for remaining mute, in Mrs. Greenfield’s words, was “because construction was either completed or substantially completed” on the pier and main house, which made the Greenfields realize that “complaining to the Heckenbachs after the fact would not resolve our concerns.” The main house was fully completed in October 1998. In August 1999, the Greenfields discovered, while in the Talbot County planning and zoning office investigating an unrelated matter, that the application that the Heckenbachs had submitted for a permit to construct thé pier on Windfield Farm located the proposed pier “precisely where the Heckenbachs had [pre-contractually] represented ... [to them that] the pier would be constructed.” The Greenfields also discovered “that the building permit for the main house on Windfield ¹¹⁹ [Farm] stated that the house was to be 3,800 square feet,” which was smaller in size than the main house on Windrush Farm. Armed with this information, which the Greenfields viewed as corroborating their claim of pre-contractual fraudulent and/or negligent misrepresentation, they filed suit against the Heckenbachs in the Circuit Court for Talbot County on September 10,1999.

The complaint filed by the Greenfields has five counts. Count I (fraud) and Count II (negligent misrepresentation) prayed for both legal and equitable relief. In regard to monetary relief, the plaintiffs asked for damages “in an amount to be determined but which substantially exceeds $25,000.” For equitable relief, they asked that the timber pier erected by the Heckenbachs be removed and that the main house be relocated so that it will be in “full compliance with the terms of the Residential Permit issued to [the Heckenbachs] and the representations [the Heckenbachs] made to [the Greenfields].” In addition, plaintiffs ask, as equitable relief, that the Heckenbachs be ordered to “[p]lant and maintain sufficient mature trees to block the view of [the Heckenbachs’ house] from [Windrush Farm] where said house extends westerly beyond the grove of trees where [the Heckenbachs] represented that their house would be built.” Count III asserted that the Heckenbachs’ construction of both the pier and the main house violated the building permits issued by Talbot County. 4 The fourth count alleged that the erection of the pier violated the “wetlands license” that the ¹²⁰ Heckenbachs were issued prior to constructing the timber pier. The fifth count is captioned “Unjust Enrichment.” The Heckenbachs filed an answer to the complaint, in which they denied making any of the oral construction plan representations alleged by the Greenfields.

They also filed a motion for summary judgment, supported by an affidavit signed by Mrs. Heckenbach and interrogatory answers filed by the Greenfields. The interrogatory answers showed, inter alia, that both of the Greenfields were licensed attorneys who had previously bought or sold land on numerous occasions. The plaintiffs responded by filing an opposition to the summary judgment motion, together with various exhibits and an affidavit by Mrs. Greenfield. Shortly before a hearing on the motion for summary judgment, the Heckenbachs were forced by governmental authorities to remove the pier on Windfield Farm because it extended more than 150 feet into Irish Creek.

Therefore, the only item constructed by the Heckenbachs that is currently blocking the Greenfields’ water view is the main house on Windfield Farm. The Heckenbachs, however, plan—if allowed to do so—to build a shorter (150') pier, but at the same location. After hearing oral argument on the matter, the motions judge granted summary judgment in favor of the Heckenbachs on all counts. His reasons for doing so was based on the “reasoning, analysis, and authorities set forth in [djefendants’ memorandum filed in support of their motion for summary judgment ... as well as [those reasons] asserted by counsel for [defendants at the hearing on said motion.” In their motion for summary judgment, the Heckenbachs advanced numerous reasons why summary judgment should be granted.

We will, therefore, discuss each of those reasons.

II

ANALYSIS As to Counts III and IV, the reasons successfully advanced by the Heckenbachs in favor of the grant of summary judgment was that the Greenfields had no standing to ¹²¹ object, even if the house and/or the pier did violate either the terms of the building permit or the terms of the wetlands license. In the Greenfields’ initial brief, they do not argue that the motions judge erred in granting summary judgment as to Counts III and IV, nor do they advance such an argument in their reply brief. Accordingly, appellants waived any right they otherwise would have had to object to the grant of summary judgment as to Counts III and IV. The grant of summary judgment as to those counts shall be affirmed. 5 In arguing that summary judgment should be granted as to Count V, one of the reasons advanced by the Heckenbachs was that appellants could not succeed on an unjust enrichment theory because plaintiffs had no proof that they (the Greenfields) had conferred any benefit upon the Heckenbachs.

In their brief, the appellants do not argue that the trial judge was wrong in accepting that argument. Therefore, any contention that the trial judge erred in granting summary judgment as to Count V is waived. 6 III. THE PAROL EVIDENCE RULE AS IT RELATES TO COUNT I—THE FRAUD COUNT “The legal principles which govern here are well established in Maryland. As long ago as 1869, Judge Miller, speaking for the Court, said in Bladen v. Wells, 30 Md. 577 , 581: ‘No principle of law is more firmly settled than that which excludes parol evidence from being used either at law or in equity for the purpose of contradicting, adding to, subtracting from, or varying the terms of a deed, or controlling its legal operation and effect, except where it ¹²² is impeached for fraud, or where it is sought to be reformed upon the allegations of fraud, accident or mistake.’ This is generally referred to as the merger doctrine, and many decisions pertinent thereto are collected in 6 M.L.E., Conveyances, § 94.” Id. at 598-99.

Canatella v. Davis, 264 Md. 190, 200 , 286 A.2d 122 (1972) (emphasis added) (citing Mullins v. Ray, 232 Md. 596, 598-99 , 194 A.2d 806 (1963)); see also Donovan v. Kirchner, 100 Md.App. 409, 419 , 641 A.2d 961 (1994). The Heckenbachs contend that, if trial were held in this matter, the parol evidence would prevent the Greenfields from testifying as to the alleged oral representations concerning the Heckenbachs’ construction plans for Windfield Farm because such testimony would contradict the words in the integration clause contained in the written contract. While the Heckenbachs obliquely acknowledge that the parol evidence rule contains an exception for fraud, they contend that the fraud exception is inapplicable here. As will be shown, the case of Fowler v. Benton, 229 Md. 571, 583 , 185 A.2d 344 (1962), demonstrates that the existence of an integration clause in a written contract, standing alone, does not bar a fraud count such as the one set forth in Count I. In Fowler , the plaintiffs negotiated with C.P. Benton for the purchase of a home located in Prince George’s County.

Id. at 573 , 185 A.2d 344 . Benton, a builder with over thirty-five years’ experience, owned a five-room house with one bathroom. Id. At the time Benton negotiated the contract with the plaintiffs, Benton knew that the plaintiffs’ family consisted of nine children and two adults.

Id. at 573, 581 , 185 A.2d 344 . In pre-contract negotiations, Benton agreed with the plaintiffs to make certain alterations and additions to the house, which, when completed, increased its size to “five bedrooms, two baths, living room, dining room, and kitchen.” Id. at 573 , 185 A.2d 344 . Mrs. Fowler (one of the plaintiffs) asked Benton during pre-contract negotiations if she and her husband “could rely upon the septic system installed in the home.” Id. at 574 , ¹²³ 185 A.2d 344 . Benton replied that “there wasn’t any reason in the world why [the plaintiffs] couldn’t feel that it was adequate because it had been put in according to Health Department regulations and that it had been approved by the County Health Department.” Id.

While it was true that the septic system was constructed according to the permit issued to Benton by the health department, the system had not been approved after the additions to the house had been made. Id. Soon after the Fowlers purchased the home from Benton, serious septic problems developed. Id.

The Fowlers subsequently brought suit against Benton, and others, alleging, inter alia, fraud and deceit. Id. at 573 , 185 A.2d 344 . At the conclusion of the plaintiffs’ case, the trial judge directed a verdict in favor of Benton on the fraud and deceit counts. Id.

The Court of Appeals reversed the judgment as to Benton, holding that there was sufficient evidence from which the jury could find that Benton sold the house to the plaintiffs knowing that the septic system was inadequate for a family of' eleven and thus had intentionally made a false representation; additionally, the Court found that all the other elements necessary to show fraud had been proven. Id. at 580-82 , 185 A.2d 344 . In Fowler , as here, the contract for sale of real estate contained an integration clause, which is sometimes also referred to as a “merger clause.” Id. at 583 , 185 A.2d 344 . The Fowler Court said: Although Benton does not urgently press the point, he mentions, in his brief, that the contract involved herein contained an integration, or merger, clause.

We do not find it necessary to discuss the point elaborately. In the first place, there was no objection to the testimony of Mr. and Mrs. Fowler as to the statements made to them by Benton with reference to the adequacy of the sanitary system. And where fraud is alleged to have caused the execution of a written contract, a merger clause therein is not conclusive. 5 Williston, Contracts, (Third Ed., Jaeger), § 811; Restatement, Contracts, § 238. Cf.

Schmidt v. Millhauser, 212 ¹²⁴ Md. 585, 130 A.2d 572 ; Rinaudo v. Bloom, 209 Md. 1 , 120 A.2d 184 . Id. at 583 , 185 A.2d 344 (emphasis added). Volume 5, section 811 of Williston on Contracts, cited by the Court in Fowler , provides, in relevant part, that a “merger clause is ineffectual to exclude evidence of extraneous prior to contemporaneous representations of either the principal or an agent to establish fraud.... ” The Fowler case was relied upon in Fort Howard Cup Corp. v. Quality Kitchen Corp., 1992 WL 207276 , 1992 Del.Super. Ct. Lexis 337 (1992), where a defendant brought a counterclaim for, inter alia, negligent misrepresentation and fraud.

Id., 1992 WL 207276 at ¹, 1992 Del.Super. Ct. Lexis 337 at ³. Applying Maryland law, the Court said: Plaintiffs argue the parol evidence rule bars defendant from introducing evidence on the fraud and misrepresentation counterclaims. Plaintiffs point to a merger clause in the lease agreement and suggest the Court may consider only the language in the lease agreement to discern the parties’ complete understanding.

Plaintiffs contend the agreement clearly reflects defendant knowingly opted to rent the model 1100 which it obtained and nothing in the lease indicates defendant hoped to obtain the purported higher quality model 6500 machine. An allegation that fraud caused the execution of an agreement renders a merger clause in that agreement inconclusive. Fowler v. Benton, 229 Md. 571 , 185 A.2d 344, 352 (1962). Under Maryland law, “the materiality of a misrepresentation turns on the facts of a particular case.” Chesapeake Homes, Inc. v. McGrath, 249 Md. 480 , 240 A.2d 245 (1968).

Similarly, Delaware courts have recognized numerous exceptions to the parol evidence rule including evidence to prove fraud or to prove a collateral or separate agreement. Scott-Douglas v. Greyhound Corp., Del.Super., 304 A.2d 309, 315 (1973). Maryland courts have endorsed the views expressed by Professor Corbin concerning the parol evidence rule: ¹²⁵ Its name has distracted attention ... from the real issues that are involved which “may be any one or more of the following: (1) Have the parties made a contract? (2) Is that contract void or voidable because of illegality, fraud, mistake, or any other reason?

(3) Did the parties assent to a particular writing as the complete and accurate ‘integration’ of that contract” ... “In determining these issues, or any of them there is no parol evidence rule to be applied. On these issues, no relevant evidence, whether parol or otherwise is excluded. No written document is sufficient, standing alone, to determine any one of them.... ” Smith v. Rosenthal Toyota, Inc., 83 Md.App. 55 , 573 A.2d 418 (1990), cert. denied, 320 Md. 800 , 580 A.2d 219 (quoting Whitney, Exec. v. Halibut, 235 Md. 517, 527 , 202 A.2d 629 (1964)). Id., 1992 WL 207276 at ³, 1992 Del.Super.

Ct. Lexis 377 at ⁷-8 (emphasis added). The Heckenbachs rely heavily on Call Carl, Inc. v. BP Oil Corp., 554 F.2d 623 (4th Cir.1977) in support of their argument that in the case sub judice the parol evidence rule would defeat the Greenfields’ fraud count. In Call Carl, the plaintiffs were ten independent service station operators who were notified that their leases and franchise agreements with BP Oil would not be renewed when their contracts expired. Id. at 624 .

All the operators’ lease and franchise agreements with BP specified that, after an initial period of time, the leases would be renewed thereafter “for successive terms of one year each, provided, however, that either party may terminate the lease at the end of the first one-year term or any successive yearly term on Thirty (30) days’ written notice given prior to the end of any such term.” Id. at 625 . In September of 1973, despite the fact that the plaintiffs had not violated their agreements with BP over several successive terms, BP gave thirty days’ notice to the plaintiffs that their dealerships would be terminated at the expiration of their terms. Id. The plaintiffs contended that they were induced by BP’s agents to enter into the franchise agreements with a knowingly false ¹²⁶ oral representation that the agreements, although of one-year terms, would be renewed annually as long as the plaintiffs complied with their contractual obligations.

Id. at 628-29 . Plaintiffs sued BP in federal court for antitrust violations as well as state law claims for breach of contract, fraud, and deceit. Id. at 624 . The jury found in favor of BP (and a co-defendant) on the breach of contract count but found the defendants liable, applying Maryland law, for fraud and deceit.

Id. at 624-25 . The court in Call Carl accurately pointed out that under Maryland law, five elements must be proven to recover on a fraud count: (1) a representation made by a party was false; (2) its falsity was either known to the party or made with such reckless indifference to the truth to impute knowledge; (3) the misrepresentation was made for the purpose of defrauding some other person; (4) that person reasonably acted in reliance upon the misrepresentation with full belief in its truth, and he would not have done the thing from which damage resulted had it not been made; and (5) the person so acting suffered damage directly resulting from the misrepresentation. Id. at 629 (citing James v. Goldberg, 256 Md. 520 , 261 A.2d 753 (1970)). The Court held that the first four elements had been proven, but as to the fifth—the existence of damages—held that the plaintiffs’ proof was insufficient.

Call Carl, 554 F.2d at 629 . The Court said: It is true that the parol evidence rule presents no bar to proof of fraud in a fraud and deceit action, Standard Motor Co. v. Peltzer, 147 Md. 509 , 128 A. 451 (1925); nor in an action for rescission even where oral representations are expressly disclaimed in the contract. Ortel v. Upper Ashburton Realty Co., 171 Md. 678 , 190 A. 239 (1937). But we do not believe that the Maryland Court of Appeals would extend this principle to permit damage awards that, by the expedient of a fraud label, would severely undermine the ¹²⁷ policy of the parol evidence rule, which is grounded in the inherent reliability of a writing as opposed to the memories of contracting parties.

See Housing Authority of College Park v. Macro Housing, Inc., 275 Md. 281 , 340 A.2d 216 (1975). This result finds support in the case of Canatella v. Davis, 264 Md. 190 , 286 A.2d 122 (1972), where the court, in an action for fraud and breach of real estate covenants, noted that the relaxation of the parol evidence rule for fraud is recognized only in the pursuit of equitable remedies, such as reformation or specific performance. The plaintiff, having sued for damages, was held to have chosen his form of action at law, and was therefore subject to the constraints of the parol evidence rule. If Maryland law will not allow contract damages (as sought here) for loss of an expectancy created in Canatella both by oral representation and a previous writing inconsistent with the terms of a deed in an action on its covenants, we do not think it would do so in a fraud action based wholly on oral representations plainly contradicto'ry to the terms of a contract, as appears in this case.

Id. at 630 (emphasis added). Contrary to the language used in Call Carl, the Canatella Court did not “note[ ]” that “the relaxation of the parol evidence rule for fraud is recognized only in the pursuit of equitable remedies, such as reformation or specific performance.” There was no fraud proven against the seller (Canatella ) because there was no showing that the seller knew the representations at issue (the amount of acreage sold) were false or made with reckless indifference to the truth. 264 Md. at 200 , 286 A.2d 122 . The Canatella Court, while saying that the parol evidence rule was applied differently in law as opposed to equity, did not spell out the difference; instead, the Court simply pointed out that the case at hand was a law action where the plaintiffs had failed to prove fraud and that no other exception to the parol evidence rule was applicable. Id. at 203-04 , 286 A.2d 122 .

Insofar as the Call Carl Court interpreted Maryland law as meaning that fraud was not an exception to the parol evidence ¹²⁸ rule in law actions, we believe the Court was mistaken. See Fowler, 229 Md. at 583 , 185 A.2d 344 . See also Martens Chevrolet, Inc. v. Seney, 292 Md. 328 , 338 n. 7, 439 A.2d 534 (1982) (discussed infra). Moreover, Call Carl is distinguishable in another important way.

In the Call Carl opinion, an integration clause was not even mentioned. Instead, the written contract explicitly contradicted what the plaintiffs claimed was said orally, i.e., the written contract said that BP could end the contract at the end of each one-year term if it chose to do so, while the oral promise was (allegedly) that the contract could not be cancelled at the end of the one-year term—unless the plaintiffs failed to abide by the terms of the agreement. In the case at bar, the written contract was silent as to any pre-contractual representations. Instead, the merger clause said, in effect, that the parties were not bound by such representations.

The distinction was discussed in Danann Realty Corp. v. Harris, 5 N.Y.2d 317 , 184 N.Y.S.2d 599 , 157 N.E.2d 597 (1959), where the court distinguished a general merger clause (where parol evidence is admitted) from specific disclaimer of reliance upon certain representations (where parol evidence is disallowed). The plaintiff in Danann claimed that in negotiations for the purchase of a lease the seller had falsely made representations as to the operating expenses of the premises. Id. at 599. The written sales agreement said, however, that the seller “ha[d] not made ... any representations as to the ... expenses, operation or any other matter or thing affecting or related to the ... premises, except ... [as contained in the agreement], and the Purchaser hereby expressly acknowledges that no such representations have been made____” Id. at 598 (emphasis omitted).

The written sales contract also contained a general merger clause. Id. The Danann Court, in distinguishing the case before it from ones in which only a general merger clause was involved, said: Here, however, plaintiff has in the plainest language announced and stipulated that it is not relying on any representations as to the very matter as to which it now ¹²⁹ claims it was defrauded. Such a specific disclaimer destroys the allegations in plaintiffs complaint that the agreement was executed in reliance upon these contrary oral representations (Cohen v. Cohen, ... [ 144 N.E.2d 649 (N.Y.1957)]), The Sabo case ... [ 143 N.E.2d 906 (N.Y.Sup.

Ct.1957) ], dealt with the usual merger clause. The present case, as the Cohen case, additionally, includes a disclaimer as to specific representations. This specific disclaimer is one of the material distinctions between this case and Bridger v. Goldsmith (supra) and Crowell-Collier Pub. Co. v. Josefowitz ( 5 N.Y.2d 998 , 184 N.Y.S.2d 859 , 157 N.E.2d 730 ).

In the Bridger case, the court considered the effect of a general disclaimer as to representations in a contract of sale, concluding that the insertion of such a clause at the insistence of the seller cannot be used as a shield to protect him from his fraud. Consequently, this clause, which declares that the parties to the agreement do not rely on specific representations not embodied in the contract, excludes this case from the scope of the Jackson, Angerosa, Bridger and Crowell-Collier cases (supra). (See Foundation Co. v. State of New York, 233 N.Y. 177 , 135 N.E. 236 .) [7] Id. at 599 (emphasis added). At oral argument, counsel for the Heckenbachs was asked how he distinguished the Fowler case from the case at hand.

He replied: Fowler involved, literally, a misrepresentation as to the condition of the property that was being sold.... That is a classic fraud case.... [The Fowlers’ claimed] ... “You told me you sold me a Cadillac but in fact you sold me a Chevrolet.” ¹³⁰ Counsel went on to say, quoting from Call Carl, Inc., et al. v. BP Oil Company, 554 F.2d at 631 , “A fraud action can only be predicated on misrepresentation of past or existing fact; breach of future promises lies in the realm of contract.” [8] The argument is unpersuasive. The Court in Weisman v. Connors, 312 Md. 428 , 540 A.2d 783 (1988), said: “[t]hat the misrepresentation of one’s own intention may constitute the misrepresentation of a present fact is clear.” Id. at 456 , 540 A.2d 783 (citing Levin v. Singer, 227 Md. 47, 63-64 , 175 A.2d 423 (1961)); Harper, James, and Gray The Law of Torts § 7.10, at 445-46 (2d ed.1986); see Call Carl, supra, 554 F.2d at 631 . “The only actionable fraud that could have been committed by [BP] lies ... in its misrepresentation of its existing intention to ... [renew a lease] at the time the actionable statements were made.” Id. at 631 . If a