Christiana Mall LLC v. Feet First, LLC

• Court: Superior Court of Delaware
• Decided: January 23, 2023
• Docket: N21C-09-173 CLS
• Status: Published

Opinion

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

CHRISTIANA MALL LLC, ) ) Plaintiff, ) ) v. ) ) C.A. No. N21C-09-173 CLS FEET FIRST, LLC, et al., ) ) Defendants. ) ) ) )

Date Submitted: October 28, 2022 Date Decided: January 23, 2023

Upon Plaintiff’s Motion for Summary Judgment. DENIED.

ORDER

Alexandra D. Rogin, Esquire, Eckert Seamans Cherin & Mellott, LLC, Wilmington, Delaware, 19801, Attorney for Plaintiff, Christiana Mall.

Charles J. Brown, III, Esquire, Gellert Scali Busenkell & Brown, LLC, Wilmington, Delaware, 19801, Attorney for Defendants Feet First, LLC d/b/a Flip Flop Shops, Eric Lingenfelter, Bronwyn Wilke, Eric Barr, and Heather Barr.

SCOTT, J.

1 INTRODUCTION Before the Court is Plaintiff Christiana Mall’s (“Christiana Mall”) Motion for

Summary Judgment (“Motion”). Upon consideration of the Motion and Defendants

Feet First, LLC et al.’s (“Feet First”) response, Plaintiff’s Motion is DENIED for

the following reasons.

BACKGROUND Feet First signed a lease with Christiana Mall on 2/19/2016 to occupy a retail

premises. The lease was set to expire on 6/14/2026. Christiana Mall entered a

written guaranty dated 2/19/2016 with guarantors Eric Lingenfelter, Eric Barr, and

Heather Barr to guaranty Feet First’s obligations under the lease.

Before the COVID-19 Pandemic, Feet First failed to make payments due

under the Lease. Christiana Mall delivered a Notice of Default to Feet First

demanding payment. Feet First did not cure the default, and the Lease was

terminated on 3/4/2020. After termination of the Lease, the parties attempted to

negotiate to allow Feet First to make its account current and occupy the commercial

space. Feet First made some payment but failed to make the account current. From

this point, the parties were unable to reach further agreement and Feet First

abandoned the premises in May of 2021, more than a year after Christiana Mall

terminated its lease.

2 PARTIES’ ASSERTIONS In its Motion, Christiana Mall argues that although Feet First denies breach of

the lease, Feet First’s sworn discovery responses admit it “did not pay all of the rents

called for under the Lease Agreement.” Therefore, Christiana Mall argues the failure

to pay all amounts owed constitutes default under the Lease, thereby entitling

Christiana Mall to terminate the lease and it did so on 3/4/2020. Further, Christiana

Mall argues that upon termination of the lease, Christiana Mall is entitled to recover

outstanding amounts owed at the time of termination, plus remaining amounts it

would have been owed through the Lease Term of 6/14/2026, amounting to

$641,023.22. Christiana Mall admits it received $19,267.36 as a result of

“commercially reasonable efforts to re-let the Leased Premises to multiple

prospective tenants,” so damages are $622,023.22 and Christiana Mall’s damages

against Guarantors are limited to $105,018.96, plus interest, costs, and fees as this is

the amount of rent Feet First failed to pay.

Feet First argue the Motion should be denied because its claim for damages is

too speculative, because its claims are barred by Christiana Mall’s prior breach of

contract and material facts are in dispute regarding Plaintiff’s efforts to mitigate

damages. Feet First further argues there are relevant portions of the lease that

Christiana Mall fails to mention, including an early termination clause in the event

that the sales of Feet First did meet a certain threshold, termination in the event that

3 two or more of the Christiana Mall’s anchor tenants failed to remain open for

business, as well as storefront visibility issues stemming from Feet First’s inability

to install its sign until the other tenants in the mall repositioned their signs. Feet First

contend the early termination clause and allowance for rent abatement in the lease

allow for their defenses of impossibility and impracticability to survive.

Additionally, citing a Pennsylvania case, Feet First believes its ignored request for

Christiana Mall to provide space for its signage from 2016-2019 amounted to a

breach of the covenant of good faith and fair dealing. It is Feet First’s position that

after it vacated the property in May 2021, Bronwyn Wilke visited the location in

October 2021 to find a new tenant occupying the location with a permanent sign

affixed to the premises. According to a declaration made by Bronwyn Wilke,

Christiana Mall claims no rent had been collected from the new occupant. This raised

concerns for Feet First of Christiana Mall’s reasonableness of its efforts to mitigate

its damages.

STANDARD OF REVIEW Under Superior Court Rule 56, the Court may grant summary judgment if “the

pleadings, depositions, answers to interrogatories, 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 summary judgment as a matter of law.”1 The

1 Super. Ct. Civ. R. 56(c); Burkhart v. Davies, 602 A.2d 56, 59 (Del. 1991). 4 moving party bears the initial burden of showing that no material issues of fact are

present.2 Once such a showing is made, the burden shifts to the non-moving party

to demonstrate that there are material issues of fact in dispute.3 In considering a

motion for summary judgment, the Court must view the record in a light most

favorable to the non-moving party.4 The Court will not grant summary judgment if

it seems desirable to inquire more thoroughly into the facts in order to clarify the

application of the law.5

DISCUSSION

The Court finds there are genuine issues of material fact present.

In viewing the record in a light most favorable to the non-moving party, the

sum owed to Christiana Mall, a material fact, cannot be determined and therefore it

not ripe for summary judgment. This Court agrees with Feet First’s sentiments

regarding Christiana Mall’s duty to mitigate. Christiana Mall owes a general duty to

mitigate damages if it is feasible to do so,6 such a strategy to mitigate is subject to

reasonableness and whether the loss is mitigable.7 Here, Feet Frist argue Christiana

2 Moore v. Sizemore, 405 A.2d 679, 680 (Del. 1979). 3 Id. at 681. 4 Burkhart, 602 A.2d at 59. 5 Ebersole v. Lowengrub, 180 A.2d 467, 470 (Del. 1962); Phillip-Postle v. BJ Prods., Inc., 2006 WL 1720073, at *1 (Del. Super. Ct. Apr. 26, 2006). 6 Norkei Ventures, LLC v. Butler-Gordan, Inc., 2008 WL 4152775, at *2. (Del. Super. Aug.28, 2008). 7 W.Willow-Bay Court LLC v. Robino-Bay Court Plaza, LLC, 2009 WL 458779, at *8 (Del. Ch. Feb. 23, 2009). 5 Mall failed to mitigate damages based on the Declaration of Bronwyn Wilke

regarding new tenants occupying Feet First’s previous premises with Christiana Mall

claiming they have collected no rent from the new occupant. Feet First offer credible

means by which Christiana Mall could have mitigated its damages from Defendants’

failure to pay, such as collecting rent from new occupants of the previously leased

premises. If found Christiana Mall did not collect rental income from new occupants,

there mitigation efforts would not be reasonable as they would be collecting money

from Feet First and the new tenant, making them more than whole. Because these

questions involving mitigation of damages are factual, they are issues of material

fact. Additionally, because there is question of how much Christiana Mall mitigated

their damages, the sum is uncertain, which is another issue of material fact.

CONCLUSION For the foregoing reasons, Plaintiff’s Motion for Summary Judgment is

DENIED.

IT IS SO ORDERED.

/s/ Calvin L. Scott Judge Calvin L. Scott, Jr.