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Emory Hill and Co. v. Mrfruz LLC

Superior Court of Delaware, New Castle

September 24, 2013

Emory Hill and Company, Plaintiff,
v.
MRFRUZ LLC and Christiana Mall, LLC, Defendants.

Date Submitted: August 21, 2013

Upon Defendant Christiana Mall, LLC's Motion to Vacate Default Judgment – DENIED

Scott T. Earle, Esquire, Cohen, Seglias, Pallas, Greenhall & Furman, PC, Nemours Building, Attorney for Plaintiff.

Thomas C. Marconi, Esquire, Losco & Marconi, P.A., Attorney for Christiana Mall, LLC.

OPINION

Jan R. Jurden, Judge

Before the Court is a Motion to Vacate Default Judgment filed by Christiana Mall, LLC ("Christiana" or "Mall"). Pursuant to Superior Court Civil Rule 60(b), Christiana moves the Court to vacate on grounds of excusable neglect and because the judgment is void.

FACTS

Plaintiff Emory Hill and Company ("Emory Hill"), filed a Complaint and Statement of Mechanics' Lien ("Complaint") against Defendants on October 17, 2012, alleging that Mrfruz, LLC ("Mrfruz") failed to pay for construction materials and services provided by Emory Hill in connection with a "fit-out" of Mrfruz's yogurt stand at the Christiana Mall.[1] Emory Hill seeks to impose a mechanics' lien on the lands and premises which comprise a portion of Christiana Mall, and seeks to recover directly from Christiana based on quantum meruit, quantum valebant, and unjust enrichment.[2]

Christiana's registered agent was served in Delaware with the summons and Complaint on November 7, 2012.[3] On November 8, 2012, the registered agent forwarded a copy of the Complaint to Christiana's offices in Chicago, Illinois.[4]The Complaint was immediately sent to Christiana's managing agent, General Growth Properties, Inc. ("GGP").[5] On November 9, 2012, Frank Francone of GGP's legal department sent a copy of the Complaint to Christiana's tenant, MRF Atlantic, LLC, also known as Mrfruz, along with a demand that Mrfruz defend and indemnify Christiana in accordance with the terms of the lease between Christiana and Mrfruz.[6] Mrfruz accepted its responsibility to defend and indemnify Christiana by signing and returning Francone's demand letter.[7]

On November 16, 2012, Mrfruz's counsel, David M. Shafkowitz, Esquire, copied Francone on an email sent to Emory Hill's counsel, Scott Earle, Esquire.[8]In that email, Shafkowitz took issue with some of the expenses Emory Hill claimed, and stated: "… I want to confirm that you agreed to provide the appropriate extension of time to respond to the filing in this case…."[9]

On November 21, 2012, Earle responded to Shafkowitz's November 16, 2012 email stating, in pertinent part:

This email confirms that Mr. Fruzz [sic] has an extension to answer the complaint and no default judgment will be taken against Mr. Fruzz [sic].[10]

Francone was not copied on this email, and Shafkowitz did not forward it to him. Shafkowitz did, however, respond to a November 27, 2012 email from Francone requesting an update, stating:

Looks like they are reviewing our settlement proposal. He granted the necessary extensions of time to answer. If we do not have it resolved shortly I expect to have it removed for an arbitration. I will keep you posted.[11]

On December 11, 2012, Francone sent Shafkowitz another email requesting another update.[12] Shafkowitz did not respond to this request.[13] In his supplemental affidavit, Francone states that he has no recollection (or documentation) of taking any action after Shafkowitz failed to respond to his December 11th email.[14] Francone was not concerned, however, because he believed: (1) Christiana's interests were adequately protected based on Mrfruz's defense and indemnification agreement, (2) Shafkowitz's assurances that Mrfruz was engaged in settlement discussions, and (3) Shafkowitz's representations that Earle had granted the necessary extensions of time to answer the Complaint.[15]

Mrfruz was served with process on December 10, 2012.[16] Coincidentally, on December 11, 2012, the same day Francone emailed his second status request, Earle emailed Shafkowitz, informing him that Emory Hill believed Mrfruz was not acting in good faith and had until ...


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