NOT TO BE PUBLISHED
OPINION
MOORE, JUDGE.
O'Neil and Charlene Dishon appeal from summary judgment entered by the Pulaski Circuit Court in favor of Appellees, Equity One, Inc., and American General Financial Services, Inc., on the Dishons' claims against those entities for fraud, negligent misrepresentation, and breach of an implied-in-fact contract. Finding no error, we affirm.
I. FACTUAL AND PROCEDURAL HISTORY
On March 9, 2006, Michael Shane Abbott and Sabrina Abbott conveyed, via general warranty deed,1 certain property located in Pulaski County, Kentucky, to O'Neil and Charlene Dishon. The Dishons conducted no investigation of whether any liens encumbered this property prior to this conveyance. Nevertheless, the Dishons applied to Equity One, Inc., for a loan and, in their application, the Dishons offered this property as collateral and represented to Equity One that this property had no liens encumbering it.
On March 22, 2006, Equity One ultimately accepted the Dishons' offer, a closing was held, a mortgage agreement was executed, and Equity One loaned the Dishons $197,150.2 Relevant to this case, the mortgage agreement that the Dishons executed contained, among others, the following provision:
8. [The Dishons'] Loan Application. [The Dishons] shall be in default if, during the Loan application process, [the Dishons] or any persons or entities acting at the direction of [the Dishons] or with [the Dishons'] knowledge or consent gave materially false, misleading, or inaccurate information or statements to [Equity One] (or failed to provide [Equity One] with material information) in connection with the Loan. . . .
The Dishons also executed an affidavit prior to the closing, which represented in relevant part:
5. Liens or Encumbrances. We [the Dishons] have not allowed any interest (legal rights) to be created which affects our ownership or use of this property. No other persons have legal rights in this property, except the rights of utility companies to use this property along the road or for the purpose of serving this property. There are no pending lawsuits or judgments against us or other legal obligations which may be enforced against this property. . . .
. . .
8. Reliance. We make this affidavit in order to obtain the mortgage loan. We are aware that [Equity One] will rely on our truthfulness and the statements made in this affidavit.
Sometime in December, 2007, however, the Dishons were contacted by Jeffrey Rager, an attorney representing their grantors, the Abbotts. According to the Dishons, Rager explained that the Abbotts had accepted a loan of $128,000 from Choice Capital Funding, Inc., in December, 2005,3 but Choice Capital had mistakenly used the property that the Abbotts later conveyed to the Dishons as security for that loan. Following this conversation, the Dishons investigated the matter further and discovered that Choice Capital had, on December 27, 2005, recorded a mortgage against their property as security for the Abbotts' $128,000 loan.
As an aside, Choice Capital and the Abbotts agreed that they never contemplated using the property that the Abbotts conveyed to the Dishons as collateral for any loan transaction. Indeed, the Choice Capital mortgage lien was removed from the Dishons' property on May 7, 2010.
Be that as it may, the Dishons discovered, sometime prior to November 17, 2008, that Equity One had in its possession—approximately two weeks prior to the closing of their own loan—two separate title insurance commitments noting that the Choice Capital mortgage lien encumbered the Dishons' property. Consequently, on November 17, 2008, the Dishons filed a complaint in Pulaski Circuit Court which, in relation to Equity One and its successor in interest, American General Financial Services, Inc., alleged the following:
13. On March 22, 2006, O'Neil Dishon and Charlene Dishon obtained a loan from Equity One, Inc., which property was intended to be secured by Tracts 2, 3, 14, 15, and 16 of the J. C. Collins Property.
14. In obtaining and financing the loan through Equity One, Inc., Equity One, Inc., had the duty and obligation to have a title search performed and to obtain a title insurance binder as part of its loan process, and also had the corresponding duty to inform its borrowers, the Dishons, of any and all encumbrances existing against the property located at 170 Singleton Waynesburg Road.
15. At the time Equity One, Inc., made its loan to the Dishons, it had performed a title search contemporaneously with making said loan, and knew, or should have known, that there existed a prior and superior mortgage in favor of Choice Capital Funding, Inc. from Michael and Sabrina Abbott that encumbered and constituted a lien against the Dishons' property.
16. Equity One, Inc.'s failure, or the failure of its employees, representatives, or agents, to inform the Dishons of the mortgage lien and encumbrance in favor of Choice Capital Funding, Inc., constitutes a breach of contract and/or a failure by Equity One, Inc. to exercise the requisite degree of ordinary care expected of a mortgage lender.
17. Effective March 1, 2008, it is believed that Equity One, Inc. assigned, sold and transferred all of its rights and interest in the subject mortgage loan of the Dishons to American General Financial Services, Inc. and, by virtue of such sale and transfer, the Dishons assert the aforesaid claims against American General, the successor in interest to Equity One and/or its mortgage interest in and to the subject mortgage.
18. As a result of the error and negligence of Equity One in not disclosing the mortgage of Choice Capital Funding, Plaintiffs are entitled to Judgment against Equity One for all damages suffered by them as the result of the negligent acts of its employees, representatives and agents in failing to make such disclosure, including, but not limited to, all losses sustained by the Plaintiffs in not being able to refinance their loan at a more favorable rate and the cost of savings from which the Plaintiffs would have benefitted but for the mistake, error and negligence of Equity One as previously mentioned.
Following a period of discovery (which garnered evidence more fully discussed in our analysis below), Equity One and American General moved for summary judgment, which the circuit court granted on March 29, 2010. Interpreting the Dishons' complaint, the circuit court understood that the Dishons had asserted three claims against Equity One and American General: 1) negligent misrepresentation; 2) breach of fiduciary duty; and 3) breach of an implied contract. With respect to the first of these claims, the circuit court held that the Dishons' theory of negligent misrepresentation failed because the Dishons had presented no evidence demonstrating that they reasonably relied upon any representation of Equity One and also presented no evidence supporting that Equity One was aware that it had undertaken a duty to inform the Dishons about the status of the Dishons' title to the property. As to the second claim the circuit court found that under the circumstances of this case, Equity One owed the Dishons no fiduciary duty to inform the Dishons about the status of the Dishons' title to the property. And, as to the Dishons' third claim the circuit court found that even if it assumed that Equity One had an implied contract with the Dishons and that Equity One had breached it by failing to disclose the Choice Capital mortgage to the Dishons prior to loaning the Dishons $197,150, Equity One's purported breach caused the Dishons no damage.
Thereafter, the Dishons moved the circuit court, per Civil Rule (CR) 59.05, to reconsider its judgment on their three above-referenced claims. Also, their motion asserted that they had raised a claim of fraud against Equity One and American General and that the circuit court had failed to address it. The circuit court overruled the Dishons' motion, further held that the Dishons' complaint failed to allege any claim of fraud and considered the Dishons' purported fraud claim untimely because it appeared that the Dishons had alleged this claim for the first time in their CR 59.05 motion. This appeal followed.
II. STANDARD OF LAW
Summary judgment serves to terminate litigation where "the pleadings, depositions, answers to interrogatories, stipulations, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Kentucky Rule of Civil Procedure (CR) 56.03. It should be granted only if it appears impossible that the nonmoving party will be able to produce evidence at trial warranting a judgment in his favor. Steelvest, Inc. v. Scansteel Service Center, Inc., 807 S.W.2d 476 (Ky. 1991). Nevertheless, summary judgment "is proper where the movant shows that the adverse party could not prevail under any circumstances." Id. (citing Paintsville Hosp. Co. v. Rose, 683 S.W.2d 255 (Ky.1985)). And, it is well established that a party responding to a properly supported summary judgment motion cannot merely rest on the allegations in his pleadings, but must, by counter-affidavit or otherwise, show that evidence is available justifying trial of the issue involved. Continental Casualty Co. v. Belknap Hardware & Manufacturing Co., 281 S.W.2d 914 (Ky. 1955).
On appeal, we must consider whether the circuit court correctly determined that there were no genuine issues of material fact and that the moving party was entitled to judgment as a matter of law. Scifres v. Kraft, 916 S.W.2d 779 (Ky.App.1996). Because summary judgment involves only questions of law and not the resolution of disputed material facts, an appellate court does not defer to the circuit court's decision. Goldsmith v. Allied Building Components, Inc., 833 S.W.2d 378 (Ky. 1992). Our review is de novo.
III. ANALYSIS
On appeal, the Dishons argue that the circuit court erred as a matter of law with respect to their claims of negligent misrepresentation and breach of implied contract against Equity One and American General.4 Furthermore, the Dishons claim that their complaint, as it appears above, is capable of asserting and preserving a claim of fraud.5
1. Fraud
We begin our analysis with the Dishons' claim of fraud. The entirety of the Dishons' argument hinges upon the following phrase in paragraph 15: "At the time Equity One, Inc., made its loan to the Dishons, it had performed a title search contemporaneously with making said loan, and knew, or should have known, that there existed a prior and superior mortgage in favor of Choice Capital Funding, Inc. . . ." (Emphasis added.) The Dishons reason that because they chose to use the word "knew" in this paragraph and because fraud is an intentional tort, the Dishons' complaint therefore asserted a claim of fraud, and Equity One was, therefore, on notice.
The Dishons' argument has no merit, however, because it ignores the substance of their own complaint: in spite of using the word "known," their complaint particularly characterizes Equity One's actions as a "failure by Equity One, Inc. to exercise the requisite degree of ordinary care expected of a mortgage lender" (paragraph 16), a "breach of contract" (paragraph 16), and a "mistake, error, and negligence" (paragraph 18). In light of this explicit language, we agree with the circuit court's determination that the Dishons' complaint failed to raise the issue of fraud; it lacks sufficient particularity to fairly apprise Equity One that the Dishons were asserting such a claim.
Moreover, in our own review of the record, it appears that the first time the Dishons made any allegation that Equity One's conduct constituted fraud was in their CR 59.05 motion. Therefore, the circuit court correctly declined to review this claim because "[a] party cannot invoke CR 59.05 to raise arguments and introduce evidence that could and should have been presented during the proceedings before the entry of the judgment." Hopkins v. Ratliff, 957 S.W.2d 300, 301 (Ky. App. 1997).
2. Negligent Misrepresentation
In Presnell Const. Managers, Inc., 134 S.W.3d 575 (Ky. 2004), the Supreme Court of Kentucky adopted the tort of negligent misrepresentation, as defined in Restatement (Second) of Torts § 552 (1976). Section 552 was quoted in Presnell, 134 S.W.3d at 580, as follows:
(1) One who, in the course of his business, profession or employment, or in any other transaction in which he has a pecuniary interest, supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information.
(2) Except as stated in Subsection (3), the liability stated in Subsection (1) is limited to loss suffered
(a) by the person or one of a limited group of persons for whose benefit and guidance he intends to supply the information or knows that the recipient intends to supply it; and
(b) through reliance upon it in a transaction that he intends the information to influence or knows that the recipient so intends or in a substantially similar transaction.
(3) The liability of one who is under a public duty to give the information extends to loss suffered by any of the class of persons for whose benefit the duty is created, in any of the transactions in which it is intended to protect them.
As stated in their complaint, the Dishons assert that the basis of their negligent misrepresentation claim against Equity One is Equity One's failure to disclose information, i.e., the results of its two title commitments. In and of itself, however, this warrants dismissal because "this tort requires an affirmative false statement; a mere omission will not do." Republic Bank & Trust Co. v. Bear, Stearns & Co., Inc., 707 F.Supp.2d 702, 714 (W. D. Ky. 2010). Furthermore, the Dishons fail to cite anything in the record demonstrating that Equity One ever assured or represented to the Dishons that their mortgage with Equity One would be the only mortgage encumbering the Dishons' property.6
Yet another reason justifying the circuit court's decision to dismiss this claim is found in the Restatement (Second) of Torts § 552 (1976), Comment a, which states in relevant part:
[T]he duty of care to be observed in supplying information for use in commercial transactions implies an undertaking to observe a relative standard, which may be defined only in terms of the use to which the information will be put, weighed against the magnitude and probability of loss that might attend that use if the information proves to be incorrect. A user of commercial information cannot reasonably expect its maker to have undertaken to satisfy this obligation unless the terms of the obligation were known to him. Rather, one who relies upon information in connection with a commercial transaction may reasonably expect to hold the maker to a duty of care only in circumstances in which the maker was manifestly aware of the use to which the information was to be put and intended to supply it for that purpose.
(Emphasis added.)
In short, even if the Dishons had pointed to an instance where Equity One supplied the Dishons with information for use in their commercial loan transaction (i.e., information relating to the current status of the Dishons' title), Equity One had no obligation to exercise reasonable care in providing that information, and the Dishons had no right to rely upon it, unless Equity One was manifestly aware that the Dishons would rely upon that information.
Here, the Dishons point to nothing in the record indicating that Equity One intended to supply the Dishons with information that it was manifestly aware that the Dishons would rely upon in assessing the state of their own title. To the contrary, the Dishons acknowledged in their own affidavit of title that they understood Equity One would be relying upon them to divulge the state of their title. The Dishons acknowledged in their mortgage agreement that if they failed to provide correct information to Equity One about their title, their failure would constitute an event of default and expose them to Equity One's foreclosure remedies. The Dishons also testified in each of their respective depositions that they executed both the affidavit of title and mortgage agreement with full knowledge and understanding of the contents of each document. In sum, we find no error in the circuit court's decision to dismiss this claim.
3. Breach of an Implied-In-Fact Contract
The Dishons argue that when Equity One failed to disclose the results of its two title commitments prior to their loan transaction, Equity One breached an implied-in-fact contract with them and that they were damaged as a result. Therefore, the two essential issues of this claim are 1) how this purported contract was formed,7 and 2) the nature of the Dishons' purported damage.
As to the former issue, an implied-in-fact contract is a contract where one or more of the terms are inferred from the conduct of the parties. It is a contract that is based partly or wholly upon the parties' conduct. Dorton v. Ashland Oil & Refining Co., 303 Ky. 279, 197 S.W.2d 274 (1946). Stated differently, an implied-in-fact contract is "founded upon a meeting of minds, which, although not embodied in an express contract, is inferred, as a fact, from conduct of the parties showing, in light of the surrounding circumstances, their tacit understanding." Baltimore & O.R. Co. v. United States, 261 U.S. 592, 597, 43 S.Ct. 425, 67 L.Ed. 816 (1923). With an implied-in-fact contract, mutual assent is manifested by the parties' conduct. The foundation of an implied contract is the recognition that "[w]ords are not the only medium of expression. Conduct may often convey as clearly as words a promise or an assent to a proposed promise." Israel's Adm'r v. Rice, 295 Ky. 360, 174 S.W.2d 517, 518-519 (1943); see also, Restatement (Second) of Contracts § 22 (1981).
Here, both Mr. and Mrs. Dishon testified to having no recollection of asking Equity One to advise them of the state of their title or the substance of its title commitments, and further testified to having no recollection of any representations from Equity One that it would do anything to that effect. Indeed, while they urge that an implied-in-fact contract was formed from Equity One's conduct, the Dishons nevertheless rely exclusively upon the contents of the documentation contained in Equity One's loan file to support their theory. In particular, they argue
[t]he paperwork exchanged between the parties during the processing of the loan and the fees paid by the Dishons to Equity One for processing the loan is sufficient evidence for a reasonable juror to conclude that Equity One had undertaken an obligation to properly process a loan secured by a first mortgage on the Dishon property in exchange for payment of [title insurance and processing] fees.
By making this argument, however, the Dishons again ignore that the "paperwork exchanged between the parties," specifically the mortgage agreement and affidavit of title (which they admittedly understood and executed), placed the duty of knowing the state of the Dishons' title, as well as the risk for supplying incorrect information, squarely upon the Dishons. In light of the above, this Court declines to imply the contract urged by the Dishons; its terms would conflict with the express terms of their loan transaction with Equity One, and are supported by no evidence of mutual assent (i.e., that Equity One assumed any obligation to advise the Dishons regarding the state of the Dishons' title).
An alternative reason justifying summary judgment in favor of Equity One, however, is the matter of the damages claimed by the Dishons. As described in both their complaint and in their brief before this Court, the Dishons argue that they "have been unable to refinance the Equity One mortgage to take advantage of lower interest rates."
As noted above, the terms of the Dishons' mortgage with Equity One provided for an interest rate of 9.75%. Aside from their own testimony, the only evidence presented by the Dishons demonstrating that they ever sought to refinance their loan comes in the form of an August 20, 2008 letter from a Cumberland Security Bank lending officer, Josh Anderson:
To Whom It May Concern:
In the case that Oniel [sic] and Charlene Dishon applied for a home loan from Cumberland Security Bank their rate on a 20 year mortgage would be 6.625% fixed for term of loan.
In their respective depositions, Mr. and Mrs. Dishon explained that Anderson's letter was directed toward their property at issue in this matter. They argue that it should be interpreted to mean that, but for the Choice Capital mortgage recorded against their property, Cumberland Security Bank would be willing to refinance the Dishons' Equity One loan at a rate of 6.625%. And while their calculations are not included with this record, the Dishons estimated that such a refinance would save them $1,000 each month.
Yet, the Dishons point to nothing obligating Cumberland Security Bank, or any other bank for that matter, to refinance any loan. The Dishons both testified that they had sufficient funds to pay the Equity One loan outright as of the date they discovered the Choice Capital mortgage encumbering their property, but chose not to do so. Both testified that they had other property to use as collateral for another loan, which they could have used to pay the Equity One loan outright. The loan documentation reflects that when the Dishons accepted their loan from Equity One, they negotiated and accepted an interest rate on that loan which they believed fairly reflected an interest rate for a first mortgage. And in exchange for this loan, Equity One accepted collateral from the Dishons which, assuming the Choice Capital mortgage was a valid encumbrance, had far less value than the parties had anticipated.
Thus boiled down, the Dishons simply argue that they were either damaged 1) by the simple fact that they took out a loan, or 2) because, at least until the Choice Capital mortgage was excised from their title on May 7, 2010, they were unable to use this particular property, rather than other property, as collateral for a new loan to pay off the balance of the Equity One loan. The former is not an event of damage; Equity One received nothing more than what the parties agreed upon and, indeed, actually received far less. Moreover, the latter is too speculative to warrant recovery.
IV. CONCLUSION
For these reasons, the Judgment of the Pulaski Circuit Court is hereby AFFIRMED.
ALL CONCUR.
