Opinion
C.A. No. 01C-01-230-FSS
Submitted: June 9, 2003
Decided: June 17, 2003
Upon First USA Bank's Motion for Partial Reargument DENIED
James S. Green, Esquire Seitz, Van Ogtrop Green, Wilmington.
Richard L. Abbott, Esquire The Bayard Firm, Wilmington.
Dear Counsel:
On June 9, 2003, First USA Bank filed a motion for partial reargument of the June 2, 2003 Opinion and Order. The motion is timely under Superior Court Civil Rule 59(e). In its underlying motion for summary judgment, First USA Bank alleged that the leases at issue are unenforceable because of the Statute of Frauds. Now, it is not satisfied that the court addressed the claim that the leases do not describe the premises adequately.
First USA argues that in the face of the Statute of Frauds, "[a]t a minimum the lease must reveal the location of the units, how many bedrooms the units will have, the number of bathrooms, and whether there will be a full kitchen, a living room, a dining area, and adequate storage." Furthermore, as to the Queensbury Village lease, First USA Bank alleges that the proposed location for Queensbury Village, itself, is too vague. First USA Bank provides no case authority establishing how specific a lease must be in order to get past the Statute of Frauds. And there is no rule that a lease must be so specific that it addresses "adequate storage."
RESTATEMENT (SECOND) OF CONTRACTS ¶ 131(e) (f) (1981).
First USA Bank's lead authority is Crockett vs. Green, which concerned the sale of a parcel of land. Crockett holds:
1870 WL 1647 (Del.Ch.).
Where the terms used are too vague or insensible to be rendered certain by extrinsic facts, touching the property, so that something further must be incorporated to enable us to locate the premises. . . . Such additional matter cannot be introduced except by means of a reference to it in the memorandum itself. In other words, the contract in Crockett was too vague.
This case is not like Crockett. It is apparent from the leases, themselves, that Plaintiffs are wholesaling rental properties to a bank. As presented in the Opinion and Order, the combination lease identifies the rental units by address, including apartment number, monthly rent and term. The Harbor House lease sufficiently identifies the existing building where the rental units are located, except that it does not refer to any unit by apartment number. It does, however, state that Plaintiffs will provide 68 units of approximately 700 square feet each for five years at a monthly rate of $ 3,100.00 per unit. The Queensbury lease (formally known as the Rockwood lease) similarly states that Plaintiffs will provide 50 units of approximately 900 square feet each for five years at a monthly rate of $ 2,500.00 per unit.
RESTATEMENT (SECOND) OF CONTRACTS ¶ 131(c) (1981) (reasoning that the "primary purpose of the Statute is evidentiary, to require reliable evidence of the existence and terms of the contract and to prevent enforcement through fraud or perjury of contracts never in fact made . . . Where only an evidentiary purpose is served, the requirement of a memorandum is read in the light of the dispute which arises and the admissions of the party to be charged; there is no need for evidence on points not in dispute.")
It remains to be seen whether the Plaintiffs and First USA Bank had enforceable lease agreements and if so, whether First USA Bank breached them. The jury may then decide what, if anything, the leases are worth. As discussed in the Opinion and Order, First USA Bank can explain what its representative, Melissa Counsellor, was doing signing leases on its behalf. Plaintiffs can explain why they did not insist on establishing Counsellor's bona fides when she signed $ 30,000,000.00 worth of leases in her employer's name. By the same token, Plaintiffs can explain to the jury how they considered the leases binding, even though they only describe many of the rental units in square feet. And what, if anything, they did to mitigate their alleged damages Conversely, First USA Bank can explain why it signed these leases and, allegedly, partially performed on them. And so on. Finally, after the jury returns its verdict, assuming that the court does not grant a dispositive motion during trial, the court will have a last opportunity to consider the outcome in light of a full record.
Meanwhile, despite the ambiguities presented by this situation, which the jury must address, the court is satisfied that all three leases satisfy the Statute of Frauds. The court is not satisfied that it truly understands what this case represents. And so, it looks forward to getting to the bottom of this long-standing dispute, at trial on September 29, 2003.
For the foregoing reasons, First USA Bank's motion for partial reargument is DENIED. It is so ordered.