NAS Consulting Services and Sean Yi v. Broadcast Properties, Inc.

Opinion

FILEw SLiPE¥N(18§'? CuLt??;T GFGUAM 2022 HAY 19 PH l*I 58 CLERK OF couRT

IN THE SUPERIOR COURT OF GUAM

NAS CONSULTING SERVICES and SEAN CIVIL CASE NO. CV0642-21 YI,

Plaintiffs, DECISION AND ORDER vs. GRANTING BROADCAST PROPERTIES, INC.'S BROADCAST PROPERTIES, INC., MOTION TO DISMISS

Defendant.

This matter came before the Honorable Dana A. Gutierrez on February 18, 2022 for a

hearing on Defendant Broadcast Properties, Inc. 's ("Broadcast") Motion to Dismiss Complaint

("Motion") c Present via Zoom were Attorney Edwin J. Tories representing Plaintiffs Nas

Consulting Services ("Nas Consulting") and Sean Yi ("Yi") (collectively, "Plaintiffs"), and

Attorney Martin F. Deinhart representing Broadcast. Upon a review of the briefings and in

consideration of the arguments presented by the parties, the Court now issues this Decision and

Order GRANTING the Motion.

PROCEDURAL BACKGROUND

The instant matter arises out of Plaintiffs' Complaint tiled on August 23, 2021 asserting a

Breach of Contract claim against Broadcast. On September 10, 2021 Broadcast- filed a Motion to

Dismiss Complaint citing to Rule 12(b)(6) and Rule 56 of the Guam Rules of Civil Procedure

("GRCP") alleging that the Complaint fails to state a claim upon which relief can be granted.

Motion, at 4. DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean Y u Broadcast Properties, Inc.

On October 7, 2021, Plaintiffs filed their Opposition to Motion to Dismiss. Broadcast

filed its Reply on October 22, 2021. The Court heard oral argument from the parties on February

18, 2022 and took the matter under advisement.

FACTUAL BACKGROUND

T he C ompla int a lleges tha t on December 21, 2020, Br oa dca st enter ed into a lea se

a gr eement with Na s Consulting (the "Lea se") for the use of Building B Unit 107 Kitchen,

Building B Unit 108, and Building B patio (collectively, the "Property"). Conical., at 117. The

Compla int a lleges tha t the initia l ter m of the Lea se wa s for thr ee (3) months commencing

January 18, 2021, with an option to extend the term for one (1) year "once allowance of indoor

occupancy reaches one hundred percent (l00%") and airport resume [sic] normal operation with

the airlines or at your execution of this option." Id. at 1114-15, Exhibit A.

Additionally, the Lease states that "[u]pon completion of the initial there [sic] (3) month

lease period and until one hundred percent (l00%) occupancy is allowed, the tenant will have the

option to extend on a month to month basis at the $3,000 per month rate until the option to

extend for one years kicks in." Id. at 1117, Exhibit A. The Complaint asserts that Plaintiffs have

"duly paid the monthly amounts due under the Lease and performed all obligations required by

the Lease," renewing the Lease each month as required by the Lease's terms. Id. at 1119-20.

Plaintiffs allege that on March 8, 2021, Broadcast sent a letter to Yi stating that the Lease

"grants to you the right to use the described spaces from January 18, 2021 for three months.

Therefore, the termination date is April 18, 2021. This letter is to advise you that the owner,

Broadcast Properties, Inc., will terminate the use of the described spaces on April 18, 2021. You

must vacate the described spaces on or before that date." Id. at 1121, Exhibit B. The Complaint

asserts that on April 9, 2021, Yi responded to Broadcast's letter stating that their March 8, 2021

2 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean Y: v Broadcast Properties, Inc.

letter constituted a material breach of the Lease. Id. at 1122. Yi's letter further stated that Yi

intended to "vacate the premises in order to keep the peace" and demanded $250,000 "in order to

avoid future litigation." Deck. of Mei Hui Sorensen, Exhibit 1 (Sept. 10, 2021).

DISCUSSION

I. B r o a d c a s t ' s Mo t io n t o D is m is s Mu s t B e C o n v e r t e d t o a R u le 5 6 Mo t io n f o r Summary Judgment.

Broadcast's Motion cites to Rule 12(b)(6) but states that Rule 12 allows the Court to treat

a 12(b)(6) motion as one for a Rule56 summary judgment if matters outside the pleadings are

raised in the motion. Motion, at 2. Rule l2(b)(6) of the GRCP allows a plaintiff to assert in a

responsive pleading or in a motion that the defendant failed to state a claim upon which relief

could be granted. Guam R. Civ. P. 12(b)(6), First Hawaiian Bank u Manley, 2007 Guam 2 'H 9.

Dismissal pursuant to Rule l2(b)(6) of the GRCP "is not proper unless 'it appears beyond

doubt that the Plaintiff can prove no set of facts in support of his claim which would entitle him

to relief."' Id. "In r uling on a l2(b)(6) motion, a cour t's consider a tion is limited to the

complaint, written instruments attached to the complaint as exhibits, statements or documents

incorporated in the complaint by reference, and documents on which the complaint heavily

r elies." Newby v Gov'z' o f Gu a m, 2010 Guam 4 1 14.

However, in ruling on a Rule l2(b)(6) motion to dismiss, a trial court "must convert the

dismissal motion into a summary judgment motion whenever it considers extraneous material

outside the pleadings. as Cor e Tech Int'l Cor p. M Hamil Eng'g & Const, Co., Ltd., 2010 Guam 13

1] 26-29. Where a plaintiff attaches a declaration to their opposition to a motion to dismiss, the

Supreme Court, in Core Tech v Hamil, held that the trial court should consider the attached

declarations and other documents and convert the motion to one for summary judgment. Id. at 1]

3 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nas Consulting Services and Sean Y v Broadcast Properties, Ire.

26, note 4.

Here, Broadcast submits the Declaration of Mei Hui Sorensen and attaches an additional

document not included in the Complaint in support of their Motion to Dismiss. Deal. of Mei Hui

Sorensen, Exhibit 1. The document is Yi's April 9, 2021 letter responding to Broadcast. Id.

Because the Court must consider these documents and the information therein, which were not

included in the Complaint and its accompanying exhibits, the Court finds that it must convert

Broadcast's Motion to a Motion for Summary Judgment.

11. Standard for a Motion for Summary Judgment.

P u r s u a nt t o R u le 5 6 (0 ) of t he G R C P , s u mma r y ju dgment ma y b e gr a nt ed "if t he

plea dings, deposit ions, a nswer s t o int er r oga t or ies, a nd a dmissions on file, t oget her wit h

affidavits, if any, show that there is no genuine issue as to any material fact and that the moving

pa r ty is entitled to judgment a s a ma tter of la w. " A genuine issue exists when "ther e is

'sufficient evidence' which establishes a factual dispute requiring resolution by a fact-finder."

liuka Corp. u Kawasho Inf? (Guam) Inc., 1997 Guam 10 1]7. The factual dispute must concern

a material fact. Id. "A 'material fact' is one that is relevant to an element of a claim or defense

a nd whose existence might a ffect the outcome of the suit . . . [d]isputes over ir r eleva nt or

unnecessary facts will not preclude a grant of summary judgment." Id.

In addition, "the court must view the evidence and draw inferences in the light most

favorable to the non-movant." Edwards v. Paeu'ic Financial Corp., 2007 Guam 27 'H 7. The

court's "ultimate inquiry is to determine whether a 'specific fact' set forth by the nonmoving

party, coupled with the undisputed background or contextual facts, are such that a rational or

reasonable jury might return a verdict in its favor based on that evidence." l i u k a , 1997 Guam

4 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean Y v Broadcast Properties, Inc.

10 1] 8. This standard will guide the COurt in its analysis.

A. There Are No Genuine Issues of Material Fact.

When determining whether a material fact exists, "if the movant can demonstrate that

there are no genuine issues of material fact, the non-movant cannot merely rely on allegations

contained in the complaint, but must pr oduce at least some significant pr obative evidence

tending to support the complaint." Moylan v Citizens Sec, Bank, 2015 Guam 36 'H 23. "A

genuine issue exists when there is 'sufficient evidence' which establishes a factual dispute

requiring resolution by a fact-finder ... However, the dispute must involve a 'material fact. 973

Government of Guarn v. Gutierrez, 2015 Guam 8 25 (internal citations omitted).

In this case, Plaintiffs' Complaint asserts that Broadcast's March 8, 2021 letter terminated

the Lease Agreement which constituted a material breach of the Lease Agreement. Con pl., at 'H

22-25. Plaintiffs' Opposition further specifies that Broadcast's Motion should be denied because

Yi treated the March 8, 2021 letter as an "anticipatory breach," and Plaintiffs were authorized to

"treat the repudiation as an anticipatory breach and immediately seek damages for breach of

contract." Opp., at 2-3.

The issue of whether "anticipatory repudiation" has occurred may sometimes be an issue

of fact for the fact-finder to decide. See 1 Neb. Proc., NJI2d Civ. 15.01 fl VIII (West 2021).

However, the issue of whether, known, undisputed facts constitute repudiation is a question of

law that may be decided through a motion to dismiss or a motion for summary judgment. Id.,

Truman L. Flatt & Sons Co., Inc. v Schupf, 649 N.E.2d 990, 993-94 (Ill. App. Ct. 1995) (where

there were no disputed facts so whether the plaintiffs committed anticipatory repudiation of the

contract was a question of law to be decided through summary judgment), In re Wansdown

5 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean H' VI Broadcast Properties, Inc.

Properties Corp. NV, 620 B.R. 487, 500 (Banks. S.D.N.Y. 2020 ("Ordinarily, anticipatory

repudiation presents a question of fact but when the anticipatory repudiation is expressed in

writing it may be decided as a question of law."). The fact question is whether facts exist, while

the question of law is whether the facts, when they do exist, constitute repudiation. 1 Neb. Proc.,

NJI2d Civ. 15.01 1 VIII (West 2021).

Here, the material facts relevant to Plaintiffs' breach of contract claim-the only cause of

action asserted in the Complaint-are based on the language contained in the Lease Agreement,

Broadcast's March 8, 2021 letter to Yi, and Yi's April 9, 2021 letter to Broadcast. The parties do

not dispute the contents of these documents, nor do the Plaintiffs' allege that any other relevant

documents or communications among the parties exist that may constitute additional material

facts. See Motion, Opp., Reply, Min. Entry (Feb. 18, 2022).

Plaintiffs' Opposition does not identify any facts put forth by Broadcast that Plaintiffs

dispute. Opp., at 3-4. When asked by the Court whether there are any disputed facts and if so, to

identify them, Plaintiffs, by and through counsel, did not direct this Court to any facts that are

disputed. Min. Entry (Feb. 18, 2022). Instead, Plaintiffs asserted that whether the tenant could

have exercised the option to extend the lease and the parties' intent are questions of fact. Id.

Despite these assertions, a court's interpretation of undisputed facts and the ultimate

conclusion t o be dr a wn fr om t hem r espect ing int ent ion is a ppr opr ia t ely decided t hr ough

s u mma r y ju d g me n t. F o x u J o h n s o n & W i n s e t t , 127 F.2d 729, 736-37 (D.C. 1942) ("There was

conflict concerning interpretation of the facts and the ultimate conclusion to be drawn from them

respecting intention. But her e wa s none a s to the fa cts themselves. In other wor ds, the

evidentiary facts were not substantially in dispute.") (where the court affirmed the dismissal of

6 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS . CV0642-21; Nag Consulting Services aNd Sean Y: v Broadcast Properties, Inc,

an action for specific performance of a contract through summary judgment), see B M C o .

Avery, 2001 Guam 27 at 11 9 ("Wllen the trial court looks merely to the contract language in

inter pr eting the contr a ct, a nd not to extr a neous fa cts, the cour t's inter pr eta tion is a lega l

conclusion[.]").

Plaintiffs did not meet their burden to provide the Court with "significant evidence" that

any disputed facts exist outside the contents of the Lease Agreement, the March 8, 2021 letter,

and the April 9, 2021 letter, that would be necessary for the Court, or a fact-finder, to consider in

determining whether Broadcast committed an anticipatory breach as a matter of law. Id. ;

Gutierrez, 2015 Gu a m 8 1 1 2 5 , s e e C h ild r e n o f A me r ic a ( C o r tla n d t Ma n o r ) , L L C v P ik e P la z a

Associates, LLC, 113 A.D.3d 583, 584 CRY App. Div. 2014) (where the tenant's letter offering

options for modifying terms of the lease did not constitute anticipatory repudiation as a matter of

law, but triable issues of fact remained as to whether the tenant orally expressed an unequivocal

intention to not perform). Merely asserting that facts are in dispute without identifying which

facts those may be and without providing "sufficient evidence" of those facts is not sufficient for

a fin d in g that genuine issues of material fact exist. See Gutierrez, 2015 Guam 8 ii 25

It is insufficient to mer ely r ely on the a llega tions put for th in the Compla int when

refuting the moving party's demonstration that no genuine issue of material fact exists. Moylan,

2015 Guam 36 'H 23. Neither the Plaintiffs' assertions at the February 18, 2022 Motion Hearing,

nor the Plaintiffs' Opposition, set forth any additional evidence that was not already presented in

the Complaint. Because mere reliance on allegations in the Complaint are insufficient, Plaintiffs

failed to direct this Court to facts which are disputed, and Plaintiffs have not provided the Court

with "significant evidence" establishing that any factual dispute exists, this Court finds that there

7 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nas Consulting Services and Sean Yi v Broadcast Properties, Inc.

are no genuine issues of material fact in this case.

B. Br oadcast Did N o t C o m m i t Ant icipat or y Br each As a Mat t er of Law.

Plaintiffs assert that if the Court converts Broadcast's Motion to a Motion for Summary

Judgment, then the Lease Agreement, the March 8, 2021 letter sent by Broadcast, and the April

9, 2021 letter sent by Yi present undisputed facts that the Court should use to ind summary

judgment in favor of Plaintiffs. Opp., at 4. Plaintiffs assert that Broadcast's March 8, 2021 letter

pr evented "Plaintiffs fr om exer cising their option gr anted to them under the Lease" which

constituted an "anticipatory breach" of the Lease Agreement. Id. at 5-6. Thus, Plaintiffs request

that the Court grant summary judgment in their favor. Id. at 6.

In response, Broadcast argues that Plaintiffs cannot point to any statement in the March 8,

2021 letter that specifically informs Plaintiffs that their option to extend the lease has been

repudiated. Reply, at 3. Broadcast further argues that Plaintiffs' April 9, 2021 letter admits that

the March 8, 2021 letter does not deprive the Plaintiffs of their option to extend the lease. Id. at

3-4.

The Guam Supreme Court has not addressed the definition of an anticipatory breach as a

cause of action. With regard to the standard for finding an anticipatory breach, the Restatement

(Second) of Contracts provides that;

A repudiation is: (a) a statement by the obligor to the oblige indicating that the obligor will commit a breach that would of itself give the oblige a claim for damages for total breach under § 243, or (b) a volunt a r y a ffir ma t ive a ct which r ender s t he obligor una ble or apparently unable to perfonn without such a breach.

8 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean Y u Broadcast Properties, Inc.

Restatement (Second) of Contracts § 250 (1981) (internal citations omitted).I

Williston on Contracts explains that:

It is invariably stated in the decisions that in order to give rise to an anticipatory breach of contract, the defendant's refusal to perform must have been positive and unconditional. The ntle has alternately been stated that the repudiating party must communicate "unequivocally and positively its intention not to perform", "clearly a nd ex p r es s ly" c ommu nic a t e it s int ent ion not t o p er f or m, c ommu nic a t e a "posltlve, unequivocal or distinct renunciation" o f t h e agreement, or "unequivocally signify] its intent to breach the contract", or that the repudiation be a "definite a nd unequivoca l ma nifesta tion" of the intention not to r ender performance, be "clear and unequivocal", "evince] a 'distinct, unequivocal, and absolute r efusal to per for m accor ding to the ter ms of the agr eement"', or be "entire, absolute, and unequivocal."

23 Williston on Contracts § 63:45 (4th ed. West 2022) (internal citations omitted).

1. Broadcast's Performance Requirements under the Lease Agreement.

Because anticipatory breach is the "unequivocal and positive" statement by an obligor of

the obligor 's intention to not per for m, this Cour t must fir st identify Br oadcast's pr omised

"per for ma nce" under the ter ns of the Lea se Agr eement. Id. Under Gua m la w, a contr a ct's

"plain meaning" is to be ascertained by looking to the "four corners" of the contract. Wasson la

Berg, 2007 Guam 16 1] 16_17.2

Under the Lease Agreement, Broadcast promised Plaintiffs' the use of the Property "for

an initial period of three (3) months commencing January 18, 2021" in exchange for, inter alia,

1 In Sana rap u Cyfred Ltd., the parties entered into a Land Purchase Agreement which required Cyfred to install a sewer line on the property. Cyfred, Ltd., 2009 Guam 13 114-5. When Cyfred did not take steps to install the sewer line, the Sananaps ceased their mortgage payments and sought an injunction to prohibit Cyfred from foreclosing on the property. Id. at 'H 4-11. The Cyfred Court directed the trial court on remand to consider "the time at which [Cyfred's] breach was anticipated" in deciding the amount owed, if any, by the non-breaching party. Cyfred, Ltd., 2009 Guam 13 ii 76-77. In giving these instructions, the Guam Supreme Court cited the Restatement (Second) of Contracts § 25l(l). Cyfred, Ltd., 2009 Guam 13 'll 76. Therefore, this Court Mrs to the Restatement (Second) of Contracts in reviewing the standard for anticipatory breach. 2 The Court notes that Plaintiffs here do not allege that the Lease Agreement is "ambiguous" Opp., at l~6.

9 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean Y v Broadcast Properties, Inc.

monthly rent in the amount of $3,000. Comal., Exhibit A. Broadcast promised that, upon

compilation of the "initial there [sic] (3) month lease period and until one hundred percent

(l00%) occupancy is allowed, the tenant will have the option to extend on a month to month

basis ... until the option to extend for one year kicks in." Id. Broadcast further promised that

the tenant has the "option to extend" the Lease Agreement for one (1) year "once the allowance

of indoor occupancy r eaches one hundr ed per cent (100%) and air por t r esume [sic] nor mal

operation with the airlines[.]" Id.

2. B ro adcas t' s L etter W as N o t an A nticipato ry R epudiatio n o f I ts Promises Under the Lease Agreement.

Having identified Broadcast's promises pursuant to the Lease Agreement, the question

Tums on whether Broadcast's March 8, 2021 letter communicated "unequivocally and positively

its intention not to perform" those promises. See 23 Williston on Contracts § 63:45 (4th ed. West

2022). To constitute an anticipatory repudiation, the obligor must communicate "an absolute and

unequivocal refusal to perform or a distinct and positive statement of an inability to do so." 2401

Pennsylvania Ave. Corp., v Federation of ,/ewisn Agencies of Greater P/ziladelpnia, 489 A.2d

733, 736 (Penn. 1985).

For example, in Federation of Jewish Agencies, the tenant-the Federation-entered into a

lease agreement to rent the landlord's property for a period of two years. Id. at 734-35. In that

case, the Supreme Court of Pennsylvania held that the landlord failed to prove that the tenant

committed an anticipatory repudiation of the contract where the tenant, either orally or in

writing, communicated to the landlord that: l) the lease would have no effect because it could

not take possession at the time specified in the lease, 2) the tenant did not want to occupy the

property because it had no use for it, and 3) the tenant would not consider any type of extension

10 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean YI u Broadcast Properties, Inc.

without a release of liability firm the lease. Id., at 737.

As another example, in Turner Const. Co. v US. Framing, Inc., a subcontractor entered

into a contract to obtain lumber for a construction project. Rzrner, 28 N . y s . 3 d 651, at *I-2

(N.Y Sup. Ct. 2015). When the contr a ctor exper ienced difficulty communica ting with the

subcontractor regarding the lumber contract, the contractor wrote to the subcontractor via email

stating that the contractor "is calling the bond in on the lumber and will be soliciting pricing

from a local farmer. [Subcontractor] has made it clear that they cannot perform on this project."

Id. at *2. The Turner Court found that this email was not "an unequivocal, definite, and final

expression of the contractor's intention not to perform its obligations." Id. at *5 .

Her e, Br oa dca s t 's M a r ch 8 , 2 0 2 1 let t er s t a t es t ha t t he L ea s e Agr eement "gr a nt s

[Plaintiffs] the right to use the described spaces from January 18, 2021 for three months. as

Compo., Exhibit B. Broadcast's letter elaborates, stating: "Therefore, the termination date is

April 18, 2021. This letter is to advise you that the owner, Broadcast Properties, Inc. will

terminate your use of the described spaces on April 18, 2021." Compo., Exhibit B. Three

months from the commencement of the Lease Agreement, January 18, 2021, was April 18, 2021.

Based on a plain reading of the March 8, 2021 letter and the Lease Agreement, Broadcast's

aforementioned statement is not an "unequivocal, definite, and final expression" of Broadcast's

intention not to per for m its obligations under the Lease Agr eement. See 23 Williston on

Contracts § 63:45 (4th ed. West 2022).

Although Broadcast did not recite all of Plaintiffs' rights under the Lease Agreement,

including Plaintiffs' right to exercise its option to extend on a month-to-month basis, Plaintiffs

were free to-and did-review the Lease Agreement to determine what rights, if any, Plaintiffs

11 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean Yi u Broadcast Properties, Inc.

had under the Lease Agreement.

Plaintiffs' April 9, 2021 letter makes it clear that Plaintiffs reviewed their rights under the

Lease Agreement and confined that the March 8, 2021 letter did not renounce Plaintiffs' right

to exercise the option to extend the lease. Specifically, Yi wrote in the April 9, 2021 letter:

As you know, the Memorandum provides for an absolute right to an option to extend for at least one (1) year, which can only be triggered by the Governor allowing indoor occupancy for dining reaching 100% and the airport resuming normal operations. Neither of those two events have occurred. Thus, I still have the ability to exer cise that option. You will also note that dur ing the option period, I have the absolute right to extend the lease under the Memorandum on a month-to-month basis "until the option to extend for one-year kicks in."

Deck. of Mei Hui Sorensen, Exhibit 1.

The language in Yi's April 9, 2021 letter demonstrates that Plaintiffs did not vacate the

premises because Broadcast had unequivocally renounced Plaintiffs' right to exercise their

option to extend, as Yi himself acknowledges that he "still ha[d] the ability to exercise that

option." Id. Rather, Plaintiffs decided to "vacate the premises in order to keep the peace[.]" Id.

Further, Plaintiffs admit that they never exercised their option to extend the Lease Agreement.

Min. Entry (Feb. 18, 2022).

3. I n st ead o f S eeki n g A ssu r an ce o f P er f o r man ce, P l ai n t i f f s C h o se t o Vacate the Premise and Demand Damages.

Plaintiffs assert that when faced with anticipatory repudiation, Plaintiffs have the option

to immediately seek damages for breach of contract. Opp., at 2. Broadcast argues that this

remedy is inapplicable where the complaining party is unable to prove that an anticipatory

repudiation has indeed occurred. Reply, at 4.

The determination that a breach by repudiation has occurred is often difficult to make. 23

Williston on Contracts § 63:46 (4th ed. West 2022) (internal citations omitted). In instances of

12 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean Y v Broadcast Properties, Ire,

a nticipa tor y br ea ch, the noubr ea ching pa r ty ha s the option to tr ea t the r epudia tion a s a n

immediate breach and maintain an action at once for the damages. Id. However, where the

actions of the apparently repudiating party are equivocal or uncertain, this option presents the

nonbreaching poNy With the following dilemma:

If the promise regards the apparent repudiation as an anticipatory repudiation, terminates his or her own performance and sues for breach, the promise is placed in jeopa r dy of being found to ha ve br ea ched if the cour t detennines tha t the apparent repudiation was not sufficiently clear and unequivocal to constitute an anticipatory repudiation justifying nonperformance. If, on the other hand, the promise continues to perform after perceiving an apparent repudiation, and it is subsequently determined that an anticipatory repudiation took place, the promise may be denied recovery for post-repudiation expenditures because of his or her failure to avoid those expenses as part of a reasonable effort to mitigate damages after the repudiation.

Id. (citing McNeil v_ Label, 953 A.2d 396, 462 (N.H. 2008).

Alt hough t he Gua m S upr eme C our t ha s not dir ect ly a na lyzed t he is s ue of how t o

determine whether an anticipatory breach has occurred, the Court has referenced an obligee's

solution to the aforementioned dilemma in cases where the obliged suspects that the obligor is

committing an anticipatory breach. As noted in footnote one, supra, when Cyfred apparently

took no actions towards installing the sewer line, the Guam Supreme Court acknowledged that

the Sananaps may have anticipated that Cyfred had no intention of meeting its obligations.

Cyfred, Ltd., 2009 Guam 13 at 1] 76. The Cyfred Conn cited the following from the Restatement

(Second) of Contracts:

Where reasonable grounds arise to believe that the obligor will commit a breach by non-per fonna nce . . . t he obliged ma y dema nd a dequa t e a ssur a nce of due performance and may, if reasonable, suspend any performance for which he has not already received the agreed exchange until he receives such assurance.

Id.

13 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean YI u Broadcast Properties, Inc.

Therefore, in this case, even if Broadcast's March 8, 2021 letter constituted "reasonable

gr ounds " for P la int iffs t o believe t ha t Br oa dca s t int ended t o commit a fut ur e br ea ch by

non-perfonnance, the more appropriate course of action would have been for Yi to demand

adequate assurance of the due performance. See Restaternent (Second) of Contracts § 251

(1981). Instead, Yi immediately demanded a payment of $250,000 and decided to "vacate the

premises in order to keep the peace." Deal. of Mei Hui Sorensen, Exhibit 1.

In doing so, Yi accepted the risk that a court may later find that what he regarded as an

anticipatory repudiation was not sufficiently clear and unequivocal to constitute an anticipatory

repudiation. See 23 Williston on Contracts § 63:46 (4th ed. West 2022), Magic Valley Foods,

Inc. u Sun Valley Potatoes, Inc., 10 P.3d 734, 790-91 (Idaho 2000) (where the obliged failed to

seek a dequa t e a ssur a nces of due per for ma nce of obligor a nd pr ema t ur ely cea sed it s own

performance, and the court found that obliged breached).

In sum, there can be no question that Broadcast's March 8, 2021 letter did not contain any

statement that clearly and unequivocally repudiated Plaintiffs' right to exercise its option to

extend the lease because nowhere in the March 8, 2021 letter does Broadcast make any mention

r ega r ding Pla intiffs' option or Pla intiffs' r ights under the Lea se Agr eement. In or der t o

unequivocally repudiate Plaintiffs' right to exercise the option, Broadcast would have had to, at

the very least, make a statement about that right. Further, Yi himself admitted that he "still ha[d]

the ability to exercise that option." Decl. of Mei Hui Sorensen, Exhibit 1. In the fa ce of

Broadcast's March 8, 2021 letter, Plaintiffs voluntarily chose to vacate the premises, not because

he no longer had the right to exercise the option but rather, "in order to keep the peace[.]" Id.

Accordingly, based upon a plain reading of the Lease Agreement, Broadcast's March 8,

14 DECISION AND ORDER GRANTING BROADCAST PROPERTIES, INC.'S MOTION TO DISMISS CV0642-21; Nag Consulting Services and Sean Y u Broadcast Properties, Inc.

2021 letter, and Yi's April 9, 2021 letter, this Court finds that Broadcast did not communicate "an

unequivocal, definite, and final Gxpression" of a n intention not to per for m its obligations.

Because Plaintiffs admit that they never affirmatively exercised their right to the option to

extend, Broadcasts' March 8, 2021 letter informed Plaintiffs that the initial three-month rental

period ended on April 18, 2021. In the absence of an "unequivocal and definite" repudiation of

Plaintiffs' option to extend the Lease Agreement, the Court finds that Plaintiffs were free to

exercise that right, but declined to do so.

CONCLUSION

For the foregoing reasons and in accordance with the applicable law, the Court hereby

GRANTS Broadcast's Motion to Dislniss Complaint, which has been converted to a motion for

summary judgment.

SO ORDERED: MAY 1 9 2022

HON RABLE DANA IM. GUTI EZ Judy, Suneiior Court bf Guam SERVICE VIA E-MAIL i acknowledge that an electronic copy of the original was e-maiied 10: l2l*l2zaf-4/WAn ?Twv.f Ulnar W i f e Jr[n/0

Date: § l M l 7 2 Time ~ l M } ' A C/I Deputy Clerk, Superior Court of Guam