LANDAN et al v. WAL-MART REAL ESTATE BUSINESS TRUST et al

Filing 90

OPINION resolving 56 defendants' motion for summary judgment on plaintiffs' breach of contract claim. Signed by Judge David S. Cercone on 3/31/15. (mwm)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
LINDA LANDAN, HOLLY AND LINDSEY,
LLC, JEFFREY J. SIKIRICA, Trustee for
B.L. MCCANDLESS, LP., B.L. MCCANDLESS,
LP, BROAD LAND PA, LLC, BLAZIER
DRIVE, LLC,
Plaintiffs,
v.
WAL-MART REAL ESTATE BUSINESS
TRUST, WAL-MART STORES EAST, LP,
WAL-MART STORES, INC., S. ROBSON
WALTON, President, BRIAN CORNELL,
President Wal-Mart Real Estate, MICHAEL T.
DUKE, EVP, CHARLES M. HOLLEY, JR.,
CFO, Walmart Realty,
Defendants.

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2:12cv926
Electronic Filing

OPINION
Plaintiffs commenced this action seeking damages arising from a land development
agreement that contemplated the construction of a “225 prototype” Wal-Mart supercenter.
Plaintiffs maintain that the parties entered an enforceable agreement in the form of a ground
lease and defendants then breached that agreement by failing to execute it. Presently before the
court is defendants’ motion for summary judgment. For the reasons set forth below, the motion
will be granted.
Federal Rule of Civil Procedure 56 provides that "[t]he court shall grant summary
judgment if the movant shows that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(A). Rule 56 "'mandates
the entry of summary judgment, after adequate time for discovery and upon motion, against a
party who fails to make a showing sufficient to establish the existence of an element essential to

that party's case, and on which that party will bear the burden of proof at trial.'" Marten v.
Godwin, 499 F.3d 290, 295 (3d Cir. 2007) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322–
23 (1986)). Deciding a summary judgment motion requires the court to view the facts, draw all
reasonable inferences and resolve all doubts in favor of the nonmoving party. Doe v. Cnty. of
Centre, Pa., 242 F.3d 437, 446 (3d Cir. 2001).
The moving party bears the initial burden of identifying evidence which demonstrates the
absence of a genuine issue of material fact. When the movant does not bear the burden of proof
on the claim, the movant=s initial burden may be met by demonstrating the lack of record
evidence to support the opponent=s claim. Nat'l State Bank v. Fed. Reserve Bank of New York,
979 F.2d 1579, 1581-82 (3d Cir. 1992). Once that burden has been met, the non-moving party
must set forth "specific facts showing that there is a genuine issue for trial," or the factual record
will be taken as presented by the moving party and judgment will be entered as a matter of law.
Matsushita Electric Industrial Corp. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (quoting
Fed. R. Civ. P. 56(E)) (emphasis in Matsushita). An issue is genuine only if the evidence is such
that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248 (1986).
In meeting its burden of proof, the "opponent must do more than simply show that there
is some metaphysical doubt as to the material facts." Matsushita, 475 U.S. at 586. The nonmoving party "must present affirmative evidence in order to defeat a properly supported
motion" . . . "and cannot simply reassert factually unsupported allegations." Williams v.
Borough of West Chester, 891 F.2d 458, 460 (3d Cir. 1989). Nor can the opponent "merely
rely upon conclusory allegations in [its] pleadings or in memoranda and briefs." Harter v.
GAF Corp., 967 F.2d 846, 852 (3d Cir. 1992); Sec. & Exch. Comm'n v. Bonastia, 614 F.2d
908, 914 (3d Cir. 1980) ("[L]egal conclusions, unsupported by documentation of specific facts,
2

are insufficient to create issues of material fact that would preclude summary judgment.").
Likewise, mere conjecture or speculation by the party resisting summary judgment will not
provide a basis upon which to deny the motion. Robertson v. Allied Signal, Inc., 914 F.2d 360,
382-83 n.12 (3d Cir. 1990). If the non-moving party's evidence is merely colorable or lacks
sufficient probative force summary judgment may be granted. Anderson, 477 U.S. at 249-50;
see also Big Apple BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1363 (3d Cir. 1992),
cert. denied, 507 U.S. 912 (1993) (although the court is not permitted to weigh facts or
competing inferences, it is no longer required to "turn a blind eye" to the weight of the
evidence).
The record as read in the light most favorable to plaintiff establishes the background set
forth below.

On March 3, 2005, plaintiff B.L. McCandless, L.P. (“B.L. McCandless”)

purchased a parcel of land slightly larger than eleven acres located at 555 Blazier Drive in
Wexford, Pennsylvania (“Parcel No. 1”) through a bankruptcy sale. (Doc. Nos. 58, at ¶ 1; 61,
at ¶ 66). In doing so, B.L. McCandless successfully outbid defendant Wal-Mart Real Estate
Business Trust (“Wal-Mart Real Estate”) for the parcel. (Doc. No. 61, at ¶ 67). Following this
sale, Wal-Mart’s representative Kevin Dougherty (“Dougherty”) contacted plaintiff Linda
Landan (“Landan”), a managing member of B.L. McCandless, and asked that she meet with
Jeff Doss (“Doss”), a representative of Wal-Mart Real Estate. (Doc. No. 61, at ¶ 69). At their
subsequent meeting Doss made Landan an offer to purchase Parcel 1, but Landan refused. (Id.
at ¶ 70). However, Landan did express interest in negotiating a lease for the property. (Id.)
Wal-Mart Real Estate was interested in leasing Parcel 1 for the purpose of building a
“225 prototype” superstore. (Doc. Nos. 61, at ¶ 71; 73, at ¶ 71). During the discussions with
Landan it was indicated that Wal-Mart Real Estate would require an area larger than Parcel 1.
(Doc. No. 61, at ¶ 71). In an effort to acquire the needed acreage, B.L. McCandless initiated
3

efforts to obtain a 2.8 acre parcel adjacent to Parcel 1 (“Parcel 3”) in July 2005. (Doc. No. 58,
at ¶ 2). B.L. McCandless purchased Parcel 3 on October 15, 2005. (Doc. No. 58, at ¶ 5).
Throughout the remainder of 2005, representatives of Wal-Mart Real Estate and B.L.
McCandless discussed the possibility of negotiating a lease for these properties, but did not
come to an agreement. (Doc. No. 58, at ¶ 3).
Throughout these negotiations Landan negotiated primarily with Mary Rottler1
(“Rottler”), a Senior Director of Real Estate for defendant Wal-Mart Stores, Inc. (“Wal-Mart
Stores”). (Doc. No. 58, at ¶ 6). Plaintiffs claim that “[a]n oral agreement was entered into in
March, 2006 between Mary Rottler and B.L. McCandless,” although the terms of this supposed
agreement and the circumstances of its formation are not detailed. (Doc. No. 61, at ¶ 73).
Defendants dispute that a binding oral agreement was ever entered into by the parties. (Doc.
No. 73, at ¶ 73). Despite the existence of any oral agreement, negotiations continued until a
Letter of Intent (“LOI”) was executed on June 28, 2006.2 (Doc. Nos. 58, at ¶ 7; 61, at ¶ 76;
66). Landan sent the LOI to Rottler. It began: “[i]t is my pleasure to submit the following
proposal to Wal-Mart to lease the premises known as Blazier Drive, Wexford, PA.” (Doc. No.
66).
The LOI purported to set forth the terms of a lease for a site of “approximately 19
acres” (the “Site”) which consisted of three individual adjacent parcels: Parcels 1 and 3 and an
additional 5.1 acre parcel (“Parcel 2”).3 (Id., at p. 1). By the document’s own provisions, the

1

Rottler’s maiden name was Svoboda, (Docket No. 58, at ¶ 6), which appears on several of the
exhibits submitted.
2
The first version of the LOI is dated April 5, 2006. (Doc. No. 66).
3
B.L. McCandless entered into an option contract for Parcel 2 in September of 2006, at a cost of
$8,000 per month. (Doc. No. 61, at ¶ 79). Although not reflected in any of the parties’ written
drafts, B.L. McCandless also entered into a contract to purchase a fourth adjacent parcel (the
4

LOI was “intended as an outline of the major provisions of a proposed lease between [B.L.
McCandless] and [Wal-Mart Stores].” (Id., at p. 5). The initial term of this proposed lease was
to be twenty years, with sixteen consecutive five year options to follow. (Id., at p. 2). The LOI
clarified its “non-binding” character, “whether or not countersigned.” (Id., at p. 5). In fact, it
went on to specify that “[n]either party shall have any obligation to the other with respect to
this proposal and the matters set forth herein unless and until a mutually acceptable lease
agreement is fully executed and delivered by both parties.” (Id.) (emphasis added).
The LOI contained several tentative and/or conditional aspects. First, it was expressly
indicated that its “provisions are subject to withdrawal and modification by either party at any
time for any reason.” (Id.). Further, it provided that “[a]ny acts or undertakings, or costs or
expenses incurred by either party in furtherance of, or in conducting due diligence with respect
to, th[e] proposal, are made, done and incurred at such party’s own expense.” (Id.). The
proposed lease also was noted to be contingent upon the following: obtaining the
governmental approvals and third-party agreements necessary for Wal-Mart Stores to proceed
with construction, B.L. McCandless’ “closing the purchase of parcels 2 and 3,” and Wal-Mart
Stores’ satisfaction with the title to, survey of, and physical condition of the Site. (Id., at pp. 34) (emphasis added). Finally, B.L. McCandless was to deliver the Site to Wal-Mart Stores free
of any existing tenants, including Bally’s Health Club (“Bally’s”), Trader Horn, and Brew’ry
Outlet North. (Id., at p. 4). Wal-Mart Stores would reimburse B.L. McCandless up to
$500,000 for any necessary buy-out of Bally’s lease. (Id.).
After the LOI was executed, B.L. McCandless and Rottler began negotiating the terms
of a ground lease. (Doc. Nos. 58, at ¶ 17; 61, at ¶ 77). Landan was told that the consummation

“Sperling property”) in February of 2007. (Id., at ¶ 86). Landan intended to either offer this
parcel for sale to Wal-Mart or retain it for future development. (Doc. No. 58, at ¶ 18).
5

of this deal was important to Wal-Mart Stores given its “affirmative action program,” which
sought “to increase the number of minority and female owned vendors” with which it deals.
(Doc. No. 61, at ¶ 78). The parties produced several drafts of a ground lease between
September 9, 2006, (Doc. No. 61, at ¶ 77) and July 3, 2007, (Doc. No. 58, at ¶¶ 32-33).
The July 3, 2007 draft (the “Final Draft”) contains substantial editing, both red-line and
handwritten, including a change in the name of the party identified as the “Lessor” from B.L.
McCandless to Blazier Drive LLC (“Blazier Drive”). (Doc, Nos. 58, at ¶¶ 35, 37; 66-3).
Further, the Final Draft references several unattached exhibits and is unexecuted. (Doc, Nos.
58, at ¶¶ 34, 38; 66-3, at pp. 38-61). No modifications were made to the Final Draft by either
party after July 3, 2007, and it was never withdrawn from consideration. (Doc. No. 61, at ¶
95).
Despite the seemingly continuous evolution of the lease’s terms beginning in June of
2006, plaintiffs claim that defendants promised execution of leases multiple times during this
time frame. Plaintiffs’ allege that Rottler first promised twice in mid-October of 2006 that a
closing would be held within a couple of weeks, (Doc. No. 61, at ¶¶ 81-82), but
communications between Rottler and Landan during December 2006 and January 2007
demonstrate that neither Wal-Mart Stores nor B.L. McCandless was satisfied with the
agreement’s language as of then, (Doc. No. 58, at ¶¶ 20, 22).4 While the parties continued to
exchange successive drafts, Landan repeatedly communicated deadlines by which she would

4

On December 15, 2006, Rottler sent Landan a bullet point list of issues related to a draft of the
lease which assertedly precluded Wal-Mart from executing it. (Doc. No. 58, at ¶ 20). On
January 16, 2007, Landan sent an email to Rottler highlighting “several very disturbing issues in
the lease,” including a default clause which Landan wanted addressed. (Id., at ¶ 22).
6

back away from the deal unless there was a signed lease. (Docket No. 58, at ¶¶ 24, 26, 27).5
On May 31, 2007, the then-current term of the Bally’s Sublease expired. (Doc. No. 61, at ¶
87). Landan did not terminate the tenancy and continued to permit Bally’s to operate under it.
Bally’s continued to occupy the premises until at least 2009, (Doc. No. 73, at ¶ 87), and a
subsequent email sent by Landan on July 28, 2007, explained that Bally’s “rejected the
$500,000 buy out number but [is] willing to relocate or terminate their lease,” (Doc, No. 58, at
¶ 40).
Following the delivery of the Final Draft, Landan sent an email to Rottler asking “can
we get the thing closed? What is left here?” (Doc. No. 61, at ¶ 90). At a meeting between the
two on August 3, 2007, plaintiffs allege that Rottler once again promised Landan a closing
within two weeks. (Id., at ¶ 91). However, less than two weeks later, Landan was threatening
to “cut [her] losses on this proposed deal and move in a different direction unless this is done
very soon.” (Doc. No. 58, at ¶ 41) (emphasis added). On August 15, 2007, an email from
Rottler to Landan shows there were a number of outstanding items that had to be addressed in
order to finalize the lease.6 (Id., at ¶ 42). Later that day, Landan requested a list of “requested
restrictions, explaining that “[s]ome restrictions I will agree to.” (Id., at ¶ 43). Then, on
August 23, 2007, Landan emailed Rottler threatening “an increase in the ground rent if we go
5

On April 24, 2007, Landan stated in an email to outside counsel for B.L. McCandless, “If this
is not finished by May 16, I am pulling this deal.” (Doc. No. 58, at ¶ 24). On May 5, 2007, she
explained to Rotter that “After Friday I am done. . . . I will give this property to Westinghouse.”
(Id., at ¶ 26). Then on June 1, 2007, Landan emailed outside counsel for B.L. McCandless and
Wal-Mart to explain that she “will feel [no] obligation to Walmart” if she does not receive a
signed lease by Tuesday. (Id., at ¶ 27).
6
Rottler mentions necessary steps “including, but not limited to: obtaining a subordination, nondisturbance and attornment agreement (‘SDNA’) from Fidelity Bank; negotiating a Declaration
of Restrictive Covenant; reaching a lease termination agreement between the parties and Bally’s;
negotiating an escrow agreement; drafting agreed-upon notice to surrender forms to be sent to
existing tenants; obtaining a signed purchase agreement for the Zappala property [(Parcel 3)];
and creation of several schedules for the lease.” (ECF No. 58, at ¶ 42).
7

past” September 15. (Id., at ¶ 44). Rottler responded that “Wal-Mart is willing to finish this
deal if you have the Bally’s issue worked out,” but warned that an increase to the amount of
rent would mean “our deal is done.” (Id., at ¶ 45).
While Landan continued to push for a signed lease on the existing terms, (Doc. Nos. 58,
at ¶ 46; 61, at ¶ 62), she also began investigating other options for the site. Even though
plaintiffs assert that once again in May of 2008 Rottler stated that the deal was completed and
she wanted to have a lease executed in thirty days, (Doc. No. 61, at ¶ 96), Landan took the
following steps during that timeframe. First, at some point before June of 2008, Landan began
to explore a joint venture with CBL & Associates, Inc. (“CBL”) to continue work on the WalMart project. (Doc. No. 58, at ¶¶ 47-51). Second, she entered into negotiations during June of
2008 with existing tenants to extend their leases. (Id., at ¶ 52).7 Third, on July 15, 2008,
Landan actually offered to “sell Walmart th[e] property for a price off [sic] $13 million.”
(Doc. Nos. 58, at ¶ 53; 58-35, at p. 2). Landan reduced this price once to $11.5 million on
August 21, 2008, (Doc. No. 58, at ¶ 58), and again to $10.5 million on November 6, 2008, (id.,
at ¶ 59). Fourth, beginning in at latest August 2008, Landan began investigating the possibility
of selling some or all of the property to third parties. (Id., at ¶ 56).8
The parties agree that Wal-Mart Stores discontinued this project in January of 2009,
although plaintiffs dispute whether Landon was ever informed of this decision. (Doc. Nos. 61,
at ¶ 97; 73, at ¶ 97). Regardless of the lack of notice of Wal-Mart Stores’ decision, certain
7

In a June 25, 2008 email from Landan to Rottler she explains that “[i]f we can’t get this deal
done . . . then I have no choice but to cut a new deal with Trader Horn. I have asked for an
increase in their rent to $5.00 psf NNN. They have agreed to this price conditional upon my
giving them an extension of the termination notice to 3 years.” (Doc. Nos. 58, at ¶ 52; 58-34).
8
In an August 14, 2008 email to a potential partner developer Landan mentions having to “make
a decision by Friday August 15, 2008” concerning the option of “selling off a few pads for $2.5
million dollars.” (Doc. No. 58-36, at p. 1). She also mentions an unsolicited offer from Market
Place Developers which she “promised to call them back tomorrow to discuss.” (Id.).
8

contingencies mentioned within the LOI remained unsatisfied until at least March of 2009.
Specifically, Bally’s lease had yet to be terminated. In a March 4, 2009 email from Landan to
Rottler, Landan announced that “[i]n an effort to finalize our deal, I will proceed with the
termination of [Bally’s] lease through the Bankruptcy Court.” (Doc. No. 58, at ¶ 60). Further,
B.L. McCandless never actually closed the purchase of Parcel 2, although it did have a contract
to purchase it. (Doc. No. 61, at ¶ 61).
These events culminated in B.L. McCandless filing for bankruptcy on August 8, 2009,
(id., at ¶ 98), with plaintiff Jeffrey Sikirica (“Sikirica”) being appointed as trustee, (Doc. No.
46, at ¶ 45). The property at issue was sold at a bankruptcy sale on October 25, 2011 to the
secured lender. (Doc. No. 61, at ¶ 99). Wal-Mart Stores then began to negotiate with the
purchaser and presently is working toward building a store at the Site. (Doc. No. 73, at ¶ 100).
On June 18, 2014, defendants filed a motion for summary judgment with respect to
plaintiffs’ claim for breach of contract. (Doc. No. 56). Defendants contend that this claim fails
as a matter of law because the parties never entered into an enforceable contract. Specifically,
plaintiffs have failed to establish a sufficiently definite oral agreement, and any oral agreement
to enter into a ground lease in the future would be an unenforceable agreement to agree. To the
extent that an oral agreement could reasonably be found, it would be unenforceable under the
Statute of Frauds. Further, as the LOI required any enforceable agreement to be in writing and
executed by both parties, no enforceable written contract was ever formed because the Final
Draft was never executed. Further, the “draft” nature of the Final Draft and the objective
conduct of the parties demonstrate that there was never an agreement to essential terms.
Finally, defendants assert that plaintiffs never satisfied certain identified prerequisites to
reaching a binding agreement.

9

In response, plaintiffs contend there was a valid oral agreement to enter into a ground
lease which was formed in March of 2006. The subsequent LOI satisfied the requirements of
the Statute of Frauds, making the oral agreement enforceable. The Final Draft then became a
binding written agreement, because at that juncture the parties agreed on the essential terms
and all that remained was formal execution. From plaintiffs’ perspective, the handwritten and
redline changes to the Final Draft do not preclude recognition of the document as an
enforceable contract because it is common for such an agreement to exhibit such markups.
Additionally, Landan should be permitted to testify as to her motivations for any conduct that
objectively could be viewed as contrary to her understanding that a binding agreement was in
place. Finally, plaintiffs maintain that any stated conditions precluding a valid contract
sufficiently had been satisfied.
“To state a claim for breach of contract under Pennsylvania law, a plaintiff must allege
(1) the existence of a contract, including its essential terms, (2) a breach of a duty imposed by
the contract, and (3) resultant damages.” Chemtech Int'l, Inc. v. Chem. Injection Technologies,
Inc., 247 F. App'x 403, 405 (3d Cir. 2007) (internal citations omitted). The existence of an
enforceable contract is a question of “(1) whether both parties manifested an intention to be
bound by the agreement; (2) whether the terms of the agreement are sufficiently definite to be
enforced; and (3) whether there was consideration.” ATACS Corp. v. Trans World Commc'ns,
Inc., 155 F.3d 659, 666 (3d Cir. 1998). “[W]hen the record contains conflicting evidence
regarding intent, the question of whether the parties formed a completed contract is one for the
trier of fact.” Channel Home Centers, Div. of Grace Retail Corp. v. Grossman, 795 F.2d 291,
300 n.9 (3d Cir. 1986). Where there is no genuine issue of material fact, the court may
determine the parties’ intention to be bound as a matter of law. See EBC, Inc. v. Clark Bldg.
Sys., Inc., 618 F.3d 253, 263-64 (3d Cir. 2010).
10

“In assessing intent, the object of inquiry is not the inner, subjective intent of the
parties, but rather the intent a reasonable person would apprehend in considering the parties’
behavior.” Am. Eagle Outfitters v. Lyle & Scott Ltd., 584 F.3d 575, 582 (3d Cir. 2009) (citing
Ingrassia Constr. Co., Inc. v. Walsh, 486 A.2d 478, 483 (Pa. Super. Ct. 1984)). While
“preliminary negotiations or an agreement to enter into a binding contract in the future does not
alone constitute a contract,” Channel Home Centers, 795 F.2d at 298, an agreement does not
have to be memorialized in a writing to be effective. “[I]t is well-settled in Pennsylvania that
where the parties have settled upon the essential terms and the only remaining act to be done is
the formalization of the agreement, the latter is not inconsistent with [a] present contract.”
Melo-Sonics Corp. v. Cropp, 342 F.2d 856, 859-60 (3d Cir. 1965). However, “when one party
has expressed an intent not to be bound until a written contract is executed, the parties are not
bound until that event has occurred.” Schulman v. J.P. Morgan Inv. Mgmt., Inc., 35 F.3d 799,
808 (3d Cir. 1994) (citing Essner v. Shoemaker, 143 A.2d 364 (Pa. 1958)).
Although a valid oral agreement is generally all that is required to bind the parties to
perform, “oral contracts to convey real estate violate the Statute of Frauds and are
unenforceable.” Concorde Investments, Inc. v. Gallagher, 497 A.2d 637, 640 (Pa. Super. Ct.
1985); see 33 Pa. Cons. Stat. § 1. As such, “[u]nder Pennsylvania law, a lease of real property
for a term of more than three years must be made in writing and signed by the parties creating
the lease.” Flight Sys., Inc. v. Elec. Data Sys. Corp., 112 F.3d 124, 127 (3d Cir. 1997) (citing
68 Pa. Cons. Stat. § 250.202)). This writing “requirement can be met by creation of a written
memorandum that need not consist of one single document.” Hessenthaler v. Farzin, 564 A.2d
990, 992 (Pa. Super. Ct. 1989). A writing signed by the party to be charged can incorporate
other writings if those writings are either physically attached or sufficiently identified. Id.
(citing Restatement (First) of Contracts § 208 (1932)). A prior oral agreement can also be
11

incorporated by such a writing which “sufficiently indicat[es] the terms of the oral agreement
so that there is no serious possibility of consummating fraud by its enforcement.” Strausser v.
PRAMCO, III, 944 A.2d 761, 765 (Pa. Super. Ct. 2008).
When the terms of an agreement to convey an interest in land are not sufficiently
indicated by a signed writing, its proponent faces a high burden of proof. See Firetree, Ltd. v.
Dep't of Gen. Servs., 978 A.2d 1067, 1075 (Pa. Commw. Ct. 2009). “‘[T]erms of the contract
must be shown by full, complete, and satisfactory proof,’ and the plaintiff must provide
evidence ‘of such weight and directness as to make out the facts alleged beyond a doubt.’” Id.
(quoting Kurland v. Stolker, 533 A.2d 1370, 1373 (Pa. 1987)) (emphasis in original). Courts
have found this burden to have been satisfied in only a few circumstances. See, e.g., Nakles v.
Union Real Estate Co. of Pittsburgh, 204 A.2d 50 (Pa. 1964) (prospective tenant signed lease
and paid one month’s rent, although landlord never signed lease); Zlotziver v. Zlotziver, 49
A.2d 779 (Pa. 1946) (seller admitted the existence of the oral contract under oath); Greenwich
Coal & Coke Co. v. Learn, 83 A. 74 (Pa. 1912) (donee of land took possession, made
improvements, and lived there for 20 years).
Plaintiffs argue that there are two binding agreements at issue here. First, plaintiffs
assert that “[a]n oral agreement was entered into in March, 2006 between . . . Rottler and B.L.
McCandless” to enter into a ground lease. (Doc. No. 61, at ¶ 73). Second, the parties agreed
that the Final Draft constituted an enforceable contract because at that juncture all material
terms had been finalized and the only remaining step was formal execution of the document.

12

As will now be discussed in detail, the record fails to contain sufficient evidence to support a
finding of an enforceable contract in either of these instances.9
With respect to the oral agreement allegedly entered into in March of 2006, plaintiffs’
position is less than a model of clarity. On one hand, plaintiffs assert that the March 2006 oral
agreement required that “Wal-Mart Stores would enter into a ground lease with B.L.
McCandless.” (Doc. No. 70, at p. 2). Along these lines, Landan explained in her deposition
that she was promised verbally that if she did certain things asked of her, Wal-Mart “would
sign a contract with [her].” (Doc. No. 64-2, at p. 2). On the other, plaintiffs appear to be
arguing that this oral agreement represented a binding ground lease on its own. Plaintiffs
contend that this “oral agreement had definite terms and reflected the intent of both parties to
be bound by the agreement and provided for consideration.” (Doc. No. 77, at p. 2). Whichever
position plaintiffs are attempting to advance, neither is grounded in sufficient evidence.
To the extent plaintiffs maintain that there was an oral agreement which would have
required Wal-Mart to sign a contract at some point in the future after the satisfaction of certain
conditions, such an oral agreement was nothing but an unenforceable “agreement to agree.”
See MDL Capital Mgmt., Inc. v. Fed. Ins. Co., 274 F. App'x 169, 171 (3d Cir. 2008). “[I]t is
well established that evidence of preliminary negotiations or a general agreement to enter a
binding contract in the future fail as enforceable contracts because the parties themselves have
not come to an agreement on the essential terms of the bargain and therefore there is nothing
for the court to enforce.” ATACS Corp., 155 F.3d at 666 (citing Goldman v. McShain, 247
9

Given that no binding agreements could be found to have existed between the parties, it is
unnecessary to consider defendants’ argument that plaintiffs’ failure to satisfy certain stated
conditions precluded contract formation. However, this argument would fail because “an
unfulfilled condition does not impede the formation of a valid contract. Instead, . . . the inquiry
is whether the unfulfilled condition postponed the duty to perform under the contract.” Shovel
Transfer & Storage, Inc. v. Pennsylvania Liquor Control Bd., 739 A.2d 133, 139 (Pa. 1999).
13

A.2d 455, 458 (Pa. 1968)). Therefore, to the extent plaintiffs argue that defendants orally
agreed to sign a lease in the future, that position fails because such an agreement lacks
sufficient essential terms and would be unenforceable.
Plaintiffs also have failed to adduce sufficient facts for a reasonable jury to conclude
that the parties formed a binding oral lease agreement in March of 2006. Plaintiffs repeatedly
assert that “[a]n oral agreement was entered into in March, 2006 between Mary Rottler and
B.L. McCandless.” (Doc. Nos. 61, at ¶ 73; 70, at pp. 1-2; 77, at pp. 1-2). These assertions
merely amount to a legal conclusion which, on its own, is insufficient to preclude summary
judgment. Bonastia, 614 F.2d at 914. Plaintiffs do summarily conclude that this alleged “oral
agreement had definite terms and reflected the intent of both parties to be bound by the
agreement and provided for consideration.” (Doc. No. 77, at p. 2). However, no specific facts
uncovered during discovery support the existence of any of the three essential elements of an
enforceable contract at this juncture. See ATACS Corp., 155 F.3d at 666.
More specifically, establishing the element of intent appears to be plaintiffs’ most
formidable challenge. Plaintiffs point to no specific facts which support the parties’
manifestation of intent to be bound by an oral agreement in March of 2006. The existing
evidence actually compels the opposite conclusion. In particular, the parties’ first version of
the LOI was produced on April 5, 2006, only days after the asserted formation of the oral
agreement. In its final form, the LOI began with Landan indicating that it was her “pleasure to
submit the following revised proposal to Wal-Mart.” (Doc. No. 66, at p. 1) (emphasis added).
The LOI makes no reference to any prior oral agreement. In fact, the LOI makes it clear that
no binding lease existed between the parties at that point. (Id. at p. 5) (“This lease proposal is
intended only as an outline of the major provisions of a proposed lease between Landlord and
Tenant, and as such, whether or not countersigned, is non-binding.”). In addition, none of the
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parties is even alleged to have mentioned an existing oral agreement during the course of the
negotiations. Thus, there is no evidence of an enforceable March 2006 oral agreement to enter
into a ground lease and all objective evidence negates the existence of such an agreement.
No reasonable jury could conclude that the parties manifested the intent to be bound by
an oral agreement in March of 2006 based on the evidence of record. As such, plaintiffs have
failed to establish a genuine issue of material fact with regard to this essential element of their
claim for breach of an oral agreement, and summary judgment is proper. See Celotex Corp.,
477 U.S. at 322-23.
Even if plaintiffs could establish a genuine issue with respect to the existence of a
binding oral agreement, any such agreement would be unenforceable under the Statute of
Frauds. As a lease of real property with a term of more than three years, the purported March
2006 agreement must have been in writing and signed by the parties to be enforceable. Flight
Sys., Inc., 112 F.3d at 127. Plaintiffs argue that the statute’s writing requirement was satisfied
by the LOI. (Doc. No. 77, at p. 3). Assuming the LOI separately satisfies the statute, this
argument still skips a necessary logical step. While the terms of an oral lease agreement can be
incorporated into a subsequent writing which independently satisfies the Statute of Frauds, that
writing must “sufficiently indicate the terms of the oral agreement so that there is no serious
possibility of consummating fraud by its enforcement.” Strausser, 944 A.2d at 765.
Here, the LOI cannot have the effect of incorporating a prior oral agreement because it
fails to recognize that such an agreement exists. To the contrary, it expressly refutes the
existence of such an agreement. Any other writings relevant to this matter share this lack of
recognition, in addition to lacking signatures. This leaves the purported March 2006 oral
agreement without a writing sufficient to satisfy the statute. Without a sufficient writing, an
oral lease agreement will only be enforced if circumstances demonstrate its existence beyond a
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doubt. See Firetree, Ltd., 978 A.2d at 1075. As defendants are not alleged to have admitted
the agreement’s existence under oath, taken possession of the property or paid rent, any oral
lease agreement entered by the parties in March of 2006 would be unenforceable under the
Statute of Frauds. Id.
Plaintiffs also have failed to establish a genuine issue of material fact regarding the
existence of a written agreement between the parties. Plaintiffs concede that the LOI did not
establish a binding lease agreement. (Doc. No. 70, at p. 4). They nevertheless contend that the
parties’ conduct clearly demonstrates the intent to be bound by the terms of the Final Draft.
(Id., at pp. 5-10). This is so despite the Final Draft’s lack of execution. (Id., at p. 4).
Plaintiffs’ arguments on this score fail for two reasons. First, the parties specifically
contemplated that execution was necessary to establish a binding agreement. (Doc. No. 66, at
p. 5). Second, a reasonable jury could not conclude, based on objective manifestations of
assent, that the parties intended to be bound by the terms of the Final Draft.
Plaintiffs’ assertion that the lack of execution does not preclude the Final Draft from
being enforced as a binding contract fails to identify sufficient evidence to overcome the effect
of the LOI. Plaintiffs correctly note that the failure to formalize an agreement alone will not
preclude its enforcement when the parties have settled on all of its essential terms. MeloSonics Corp., 342 F.2d at 859-60. “As a general rule, signatures are not required unless such
signing is expressly required by law or by the intent of the parties.” Shovel Transfer &
Storage, Inc., 739 A.2d at 136. But, “if the parties themselves contemplate that their agreement
cannot be considered complete, and its terms assented to, before it is reduced to writing, no
contract exists until the execution of the writing.” Essner, 143 A.2d at 366 (Pa. 1958).
Here, the parties clearly intended that their agreement would only be binding upon
formal execution of a written lease. The LOI, the only signed agreement between the parties,
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explicitly states that “[n]either party shall have any obligation to the other with respect to this
proposal and the matters set forth herein unless and until a mutually acceptable lease
agreement is fully executed and delivered by both parties.” (Doc. No. 66, at p. 5). Plaintiffs
admit that the LOI was executed before the parties even began negotiating a ground lease.
(Doc. No. 61, at ¶ 77). Although Wal-Mart never formally withdrew from negotiations after
the circulation of the Final Draft and no other modifications were made to it by either party,
(id., at ¶ 95), it is undisputed that neither the Final Draft nor any other draft lease was ever
signed. Even separate proof of actual acceptance is insufficient to form a binding agreement
when the parties fail to satisfy a contractual term requiring formal execution. Schulman, 35
F.3d at 807-08 (summary judgment was proper against the proponent of an unsigned lease
agreement which expressly required execution and delivery to be binding, even though the
purported tenant took possession of the premises, made improvements, paid rent, and received
letters from the landlord’s representatives confirming the lease). As such, the parties’ failure to
sign and deliver the Final Draft precludes its enforcement here.
Even if the lack of execution did not preclude the formation of a binding written
agreement, plaintiffs have failed to establish a genuine issue of material fact as to whether such
an agreement was formed. As discussed above, an agreement cannot become binding until the
parties have manifested an intent to be bound by it. ATACS Corp., 155 F.3d at 666. In the
absence of an explicit acceptance, “‘an offer may be accepted by conduct and what the parties
d[o] pursuant to th[e] offer’ is germane to show whether the offer is accepted.” Accu-Weather,
Inc. v. Thomas Broad. Co., 625 A.2d 75, 78 (Pa. Super. Ct. 1993) (quoting Gum, Inc. v. Felton,
17 A.2d 386, 389 (Pa. 1941)). To determine whether there has been an acceptance, “the court
considers the parties’ outward and objective manifestations of assent, as opposed to their
undisclosed and subjective intentions.” Stamerro v. Stamerro, 889 A.2d 1251, 1258 (Pa.
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Super. Ct. 2005). Plaintiffs argue that the parties’ course of conduct demonstrates their
recognition of a binding agreement. (Doc. No. 70, at p. 6 (citing Accu-Weather, Inc., 625 A.2d
at 78)). This argument lacks any evidentiary support.
Plaintiffs have never alleged and no evidence shows that defendants explicitly or
implicitly assented to the terms of any written document exchanged by the parties. Instead,
plaintiffs rely on purported assurances by Rottler to Landan that a closing would occur within a
couple weeks as demonstrating Wal-Mart’s acceptance. (Doc. No. 70, at p. 5 (citing Doc. No.
61, at ¶¶ 81, 82, 91)). Viewed in isolation, a reasonable jury could view these assurances as an
assent to a final agreement. However, the context and undisputed facts preclude such a
finding.
The record undisputedly reveals that these assurances were premised on an intent to
work toward finalizing a lease; not an acknowledgment that one had been reached. Following
Rottler’s first assurance of a closing in October of 2006, (Doc. No. 61, at ¶ 81, 82), the parties
continued to negotiate the terms of the lease. (Id. at ¶ 80). They exchanged at least one
additional draft before the Final Draft was circulated on July 3, 2007. (Id., at ¶¶ 88-89). In an
email to Rottler on January 16, 2007, Landan herself pointed out that “there are several very
disturbing issues in the lease. One is the default clause. . . . We need to either delete this or
find an answer to this horrible one sided language.” (Doc. No. 58, at ¶ 22) (alteration in
original). This position in itself defeats plaintiffs’ contention that an enforceable ground lease
had been finalized when the assurance was made in October of 2006.
Rottler made a similar assurance that a closing was imminent in August of 2007. Less
than two weeks after this assurance, Landan sent her an email threatening to “just cut my losses
on this proposed deal and move in a different direction unless this is done very soon.” (Doc.
No. 58, at ¶ 41) (emphasis added). Three weeks later Landan threatened to raise the rent if the
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deal did not become finalized. She also negotiated new leases with existing tenants and
offered to sell the property outright. Clearly, not even Landan believed that a binding lease
agreement had been formed following Rottler’s promises to close.
Plaintiffs do not point to any other conduct by defendants which could support a jury
finding that defendants either assented to an enforceable agreement or believed that a binding
agreement had been formed. Instead, they are forced to explain how Landan’s conduct is
consistent with her own belief that such an agreement was in place. Plaintiffs argue that each
time Landan threatened to withdraw from negotiations if a certain deadline passed, (Doc. No.
58, at ¶¶ 24, 26, 41, 43, 44), she was only “bluffing” in order to force Wal-Mart’s hand, (Doc.
No. 70, at pp. 6-7). But Landan took several actions following the circulation of the Final
Draft that were inimical to the position that the parties had agreed on a final, enforceable
agreement and the only thing left was to execute it. She renegotiated an existing lease with
Trader Horn. (Doc. No. 58, at ¶ 52). She investigated possible joint ventures in pursuit of the
Wal-Mart lease. (Id., at ¶¶ 47, 55). And she considered potential sales of the Site. (Id., at ¶¶
53, 56, 58, 59).
Plaintiffs argue that all of these measures were simply efforts to mitigate damages, and
Landan “should be allowed to testify to a jury as to the motivations behind her actions and
statements.” (Doc. No. 70, at pp. 6-8). But Landan’s “undisclosed and subjective intentions”
have no bearing on the inquiry at hand. Stamerro, 889 A.2d at 1258. The question is whether
the statements and conduct of the parties can be found to reflect a manifestation of an
agreement to be bound. Considering only Landan’s objective manifestations, a reasonable jury
could not conclude that she believed the Final Draft was binding.
The Final Draft itself also undermines the proposition that a jury can find that the
parties agreed to a final, binding agreement. Although this version of the document was never
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withdrawn from consideration or subject to additional modifications, the Final Draft is still
very much in “draft” form. There are numerous red-line edits and handwritten changes
throughout the document. (Doc. Nos. 58, at ¶ 37; 66-3). Significantly, one of the red-line edits
alters the name of the party identified as the “Lessor” from B.L. McCandless to Blazier Drive,
LLC. (Doc. No. 66-3, at pp. 1, 34, 38). Handwritten changes modify the time periods during
which Wal-Mart could terminate the lease for any reason. (Doc. Nos. 58, at ¶ 37; 66-3, at p.
15). A handwritten note in the “Contingencies” section of the lease also indicates that
someone needed to “Revise” eight lines of text. (Doc. No. 66-3, at p. 20). These revisions
were not further identified. In addition, none of the eighteen exhibits for which the Final Draft
contains placeholders are attached to the document. (Id., at pp. 40-61). In short, the Final
Draft is not in a form which appears ready for execution. Instead, it reflects ongoing
negotiations between the parties.
Given the foregoing facts, summary judgment against plaintiffs on their claim for
breach of a written agreement is proper. Plaintiffs have adduced insufficient evidence to
support a finding that both parties assented to a written agreement or came to an understanding
that a binding written agreement existed. In other words, plaintiffs have failed to identify
evidence that will sufficiently support a finding that defendants had the intent to enter into an
existing agreement that the parties both agreed was binding. As this is an essential element of
their claim, summary judgment is proper. Celotex Corp., 477 U.S. at 322-23.
For the reasons set forth above, plaintiffs have failed to identify sufficient evidence to
proceed with their breach of contract claim, and therefore defendants’ motion for summary

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judgment (Doc. No. 56) will be granted. An appropriate order will follow.
Date: March 31, 2015
s/David Stewart Cercone
David Stewart Cercone
United States District Judge
cc:

Marvin Leibowitz, Esquire
Ronald W. Crouch, Esquire
Kevin Batik, Esquire
(Via CM/ECF Electronic Mail)

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