KEEN-WIK ASSOCIATIONS v. ANTHONY G. CAMPISI

Court of Chancery of Delaware·Decided October 19, 2020·No. CA 2019-0616-PWG·Published

Opinion

EFiled: Oct 19 2020 02:06PM EDT Transaction ID 66033233

Case No. 2019-0616-PWG

COURT OF CHANCERY

OF THE

STATE OF DELAWARE

PATRICIA W. GRIFFIN CHANCERY COURTHOUSE MASTER IN CHANCERY 34 The Circle GEORGETOWN, DELAWARE 19947

Final Report: October 19, 2020 Date Submitted: August 26, 2020

Chad J. Toms, Esquire Whiteford Taylor Preston LLC Renaissance Center, Suite 500 405 North King Street Wilmington, Delaware 19801-3700

Edward J. Fornias, III, Esquire Law Office of E.J. Fornias, P.A. 615 West 18th Street, Lower Level Wilmington, DE 19802

RE: Keen-Wik Association v. Anthony G. Campisi Civil Action Number: 2019-0616-PWG

Dear Counsel:

Pending before me are a homeowner’s motion to vacate a default judgment entered against him regarding alterations to his deck in violation of deed restrictions, and his homeowners’ association’s motion for contempt and award of attorneys’ fees and costs for his failure to comply with the default judgment. I recommend that the Court deny the homeowner’s motion to vacate the default judgment and the association’s motion for attorneys’ fees, but grant costs. I also recommend the Court grant the motion for contempt, extending the time for compliance. This is a final report.

2019-0616-PWG October 19, 2020

I. Background On August 7, 2019, Plaintiff Keen-Wik Association (“Association”) filed a complaint seeking a permanent injunction against Defendant Anthony G. Campisi (“Campisi”) for the removal of the portion of his deck extending into the twenty (20) foot setback (from the shore line) in violation of deed restrictions (“Restrictions”) on his property at 38189 Keenwik Road, Selbyville, Delaware (“Property”). The Association also contends that Campisi completed construction on the deck without obtaining approval by the Association, as required by the Restrictions. Campisi was served through the long-arm statute, 10 Del. C. §3104, in Cedars, Pennsylvania.1 When Campisi did not file an answer or respond to the complaint, the Association filed a motion for default judgment, on November 25, 2019, and a hearing on that motion was held on January 22, 2020. Campisi received notice of the hearing.2 Campisi failed to appear at the hearing and an order of default judgment (“Order”) was entered against him on January 22, 2020, granting a permanent injunction that he “remove a deck extension rearward and

1 The affidavit of service shows Campisi received service by signing for the registered letters on October 23, 2019. Docket Item (“D.I.”) 6, Ex. B. 2 See D.I. 10. The Association’s counsel emailed a copy of the notice to Campisi. Id., Ex. B. And, in a December 14, 2019 email to the Association’s counsel, Campisi stated that he was “not going to engage in this law suit, I just don’t have the time or energy right now.” D.I. 21, Ex. A; see also D.I. 13, ¶ 4.

2019-0616-PWG October 19, 2020

into the twenty foot setback” on the Property, within 90 days of the Order.3 Campisi received notice of the Order.4 Receiving no response from Campisi, the Association contacted him by phone and he “informed counsel that he is aware of the Order and does not intend to comply.” 5 In response to the Association’s May 22, 2020 motion for contempt (“Contempt Motion”), 6 Campisi filed, on July 23, 2020, his opposition to the Contempt Motion and a motion to vacate the default judgment (“Motion to Vacate”).7 II. Analysis A. Should the default judgment be vacated?

Campisi requests that the default judgment be vacated under Rule 60(b)(2), Rule 60(b)(3) and Rule 60(b)(6). “Court of Chancery Rule 55(c) permits the court to set aside a default on the grounds identified in Court of Chancery Rule 60(b).”8

3 D.I. 12.

4 The Association’s Counsel sent a copy of the Order by mail and email on or about February 10, 2020. D.I. 13, ¶ 4. When no action was taken on the deck, Association’s Counsel sent a second copy of the Order by regular and certified mail, and email, demanding a response, to Campisi, on or about April 27, 2020. Id., ¶ 4. The evidence shows the certified notice was signed for on April 29, 2020. Id., Ex. C. 5 Id., ¶ 4.

6 Id.

7 D.I. 16; D.I. 17.

8 Organovo Holdings, Inc. v. Dimitrov, 162 A.3d 102, 112 (Del. Ch. 2017).

2019-0616-PWG October 19, 2020

Motions to vacate default judgments under Rule 60(b) are addressed to the discretion of the court. 9 “Delaware public policy favors deciding cases on the merits, leading to the inference that ‘[a]ny doubt should be resolved in favor of the petitioner.’” 10 Rule 60(b) advances “two important values: the integrity of the judicial process and the finality of judgments.”11 “Because of the significant interest in preserving the finality of judgments, Rule 60(b) motions are not to be taken lightly or easily granted.”12 First, I consider whether the judgment should be vacated under Rule 60(b)(2). “Court of Chancery Rule 60(b)(2) affords a disappointed litigant an opportunity to obtain judicial reconsideration of the merits of his claim on account of ‘newly discovered evidence.’” 13 “Delaware law is clear that reopening a judgment based on new evidence is disfavored.”14 To succeed

9 Cf. Old Guard Ins. Co. v. Jimmy’s Grille, Inc., 860 A.2d 811 (Del. 2004); Word v. Balakrishnan, 2004 WL 780134, at *3 (Del. Super. Apr. 13, 2004), aff’d, 860 A.2d 809 (Del. 2004). 10 Word, 2004 WL 780134, at *3 (citation omitted); see also Dishmon v. Fucci, 32 A.3d 338, 346 (Del. 2011); Deutsche Bank Nat’l Tr. Co. v. Vleugels, 2017 WL 2124425, at *2 (Del. Ch. May 10, 2017). 11 Oklahoma Firefighters Pension & Ret. Sys. v. Corbat, 2018 WL 1254958, at *1 (Del. Ch. Mar. 12, 2018) (citation omitted). 12 Wilson v. Montague, 19 A.3d 302 (Del. 2011) (citations omitted); see also High River Ltd. P’ship v. Forest Labs., Inc., 2013 WL 492555, at *6 (Del. Ch. Feb. 5, 2013). 13 Norberg v. Sec. Storage Co. of Washington, 2002 WL 31821025, at *2 (Del. Ch. Dec. 9, 2002). 14 Oklahoma Firefighters Pension & Ret. Sys., 2018 WL 1254958, at *2.

2019-0616-PWG October 19, 2020

under Rule 60(b)(2), the moving party must show all of the following: “[1] the newly discovered evidence has come to his knowledge since the [judgment]; [2] that it could not, in the exercise of reasonable diligence, have been discovered for use [before the judgment]; [3] that it is so material and relevant that it will probably change the result . . .; [4] that it is not merely cumulative or impeaching in character; and [5] that it is reasonably possible that the evidence will be produced at the trial.” 15 Campisi argues that the Association waived its ability to exclude the deck extension into the 20-foot setback because the extension existed in the same footprint since Campisi purchased the Property around 20 years ago. 16 He offers photographs of the deck in 2016 and recently, and his statement that the footprint of the deck was unaltered by his 2018 work on the deck, as newly discovered evidence.17 The Association responds that the photographs are not newly discovered evidence, since Campisi could have discovered them before the entry of the default judgment if he had exercised reasonable diligence. 18

15 Id., at *1 (citation omitted); see also Wimbledon Fund LP v. SV Special Situations LP, 2011 WL 378827, at *5 (Del. Ch. Feb. 4, 2011) (citations omitted). 16 D.I. 17, ¶¶ 3-5.

17 D.I. 16, Ex. 1; Ex. 2; D.I. 17, ¶ 6.

18 D.I. 20, ¶ 3.

2019-0616-PWG October 19, 2020

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