DDR del Sol LLC, S.E. v. Cajun and Grill of America

Filing 60

OPINION AND ORDER GRANTING 46 MOTION for Reconsideration, filed by DDR del Sol LLC, S.E. The court reverses its earlier finding that a genuine question of material fact remains (ECF No. 44), and GRANTS summary judgment against Defendant Cajun and Grill of America, Inc., in the amount of $227,434.22 in past due rent owed under the payment plan, plus interest, late charges, and reasonable attorneys' fees incurred. Judgment in favor of Plaintiff DDR Del Sol, S.E. will be entered accordingly. Signed by Judge Jose A. Fuste on 12/18/2015.(mrj)

UNITED STATES DISTRICT COURT
DISTRICT OF PUERTO RICO

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DDR DEL SOL LLC, S.E., Successor in
interest to BY Ventures, S.E.,
Civil No. 3:15-CV-01111 (JAF)
Plaintiff,
v.
CAJUN AND GRILL OF AMERICA, INC.,
Defendant.
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ORDER

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The matter is before the court on Plaintiff DDR Del Sol, LLC, S.E.’s (“DDR Del

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Sol”) motion for reconsideration of our Opinion and Order denying DDR Del Sol’s

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Motion for Summary Judgment (ECF No. 46), filed on November 4, 2015. As of the date

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of this Order, Defendant Cajun and Grill of America, Inc. has failed to respond in

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opposition to the motion for reconsideration. After carefully examining the relevant law,

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the court GRANTS Plaintiff’s motion for reconsideration. Further, for the foregoing

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reasons, the court reverses its previous order denying summary judgment and now

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GRANTS Plaintiff DDR Del Sol’s Motion for Summary Judgment as there is no longer a

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question of material fact.

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Law and Analysis

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Plaintiff DDR Del Sol moved pursuant to Fed. R. Civ. P. 59(e) for this court to

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reconsider its order denying summary judgment. “Rule 59(e) motions are granted only

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where the movant shows a manifest error of law or newly discovered evidence.” Prescott

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v. Higgins, 538 F.3d 32, 45 (1st Cir.2008) (quoting Kansky v. Coca–Cola Bottling Co. of

Civil No. 3:15-CV-01111 (JAF)

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New Eng., 492 F.3d 54, 60 (1st Cir. 2007)). “[A] motion for reconsideration is not

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properly grounded in a request for a district court to rethink a decision it has already

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made, rightly or wrongly”. Villanueva-Mendez v. Nieves Vazquez, 360 F. Supp. 2d 320,

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324 (D.P.R. 2005) aff’d sub nom. Villanueva-Mendez v. Nieves-Vazquez, 440 F.3d 11

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(1st Cir. 2006) (citation omitted). “A district court may, however, grant a party’s motion

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for reconsideration in any of three situations: (1) the availability of new evidence not

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previously available, (2) an intervening change in controlling law, or (3) the need to

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correct a clear error of law or to prevent manifest injustice.” Id. (citation omitted).

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Because we denied summary judgment on the grounds that a genuine question of

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material fact exists as to the payment plan contained in Schedule B, an issue not

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previously briefed by the parties, and the parties have now had the opportunity to fully

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brief the issue, the court GRANTS Plaintiff DDR Del Sol’s Motion for Reconsideration

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in order to review the evidence that has since been presented to the court regarding

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Schedule B.

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On November 4, 2015, Plaintiff DDR Del Sol provided the court with the

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documents supporting its argument that the totality of the payment plan in Schedule B

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constitutes accrued “Rent” and is not subject to the 2011 Lease termination. Defendant

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Cajun and Grill of America was given ample time to brief its response in opposition to

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Plaintiff DDR Del Sol’s argument, yet it did not oppose the motion. Because we believe

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that both parties have had an opportunity to address the matter before the court, we will

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now return to the merits of Plaintiff DDR Del Sol’s motion for summary judgment and

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the supplemental briefing.

Civil No. 3:15-CV-01111 (JAF)

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The Balance of the Delinquency in Schedule B

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Previously we held summary judgment was not proper because there exists a

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genuine question of material fact as to what makes up the balance of the delinquency in

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Schedule B. The evidence now shows that Schedule B, the payment plan for $368,812

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attached to the 2009 Modification of the 1998 Lease, is comprised of $266,189.84 owed

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as of July 9, 2009, under the 1998 Lease, and $121,557.95 owed as of July 9, 2009, under

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the Suki Hana Lease, less a discount of $18,935. 1

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Plaintiff DDR Del Sol argues that the amount in Schedule B classifies as

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Additional Rent exempt from the 2011 Lease. As we previously stated, Additional Rent

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under the terms of the 2011 Lease includes Percentage Rent, taxes, Common Area

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Charge, utility charges that are not separately metered, fixed marketing charge, Food

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Court Marketing Charge, Food Court Operating Costs, Insurance Expenses, and unpaid

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rent, additional rent, costs and damages incurred under the 1998 Lease. Plaintiff DDR

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Del Sol argues that the delinquency related to the Suki Hana Lease became payable under

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the 1998 Lease under the terms of the 2009 Modification. Upon further review of the

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terms of the 2009 Modification, the 1998 Lease, and the 2011 Lease, we agree with

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Plaintiff DDR Del Sol.

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Section 12.25(g) of the 1998 Lease defines all delinquencies as “Minimum Rent”:

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Landlord shall have the same remedies for Tenant's failure to make any and
all payments required to be made by Tenant hereunder [including, but not
limited to, Percentage Rent, Operating Costs, Taxes, Marketing Charges,
separate trash removal charges, cooperative advertising and all other
charges and all advances, damages, expenditures, late fees, administrative
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The discount reduced the Minimum Rent from $16,230 to $13,525 for seven months.

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charges, fines, additional rent, security deposit reimbursements and
Interest] as for failure to pay Minimum Rent, as if, for purposes of such
remedies, all of the foregoing were deemed part of Minimum Rent. Specific
references to this point elsewhere in this Lease shall not limit the generality
of this paragraph.

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and the Suki Hana Lease into Schedule B, an obligation of the tenant, thereby making the

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amount owed under Schedule B, regardless of its genesis, “Minimum Rent” under the

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terms of the 1998 Lease. Accordingly, all of the delinquent charges incorporated into the

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payment plan are deemed part of Minimum Rent, i.e., within the meaning of “Rent”

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under the 1998 Lease, as amended, and excluded from termination under the 2011 Lease.

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Attorney’s Fees

The 2009 Modification then incorporated the delinquencies of both the 1998 Lease

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Having found that the entire payment plan in Schedule B of the 2009 Modification

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is exempt from the termination of the 1998 Lease, we must continue our analysis of

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Plaintiff DDR Del Sol’s motion for summary judgment. In addition to the $227,434.22

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in past due rent owed under the payment plan, Plaintiff DDR Del Sol requests $40,233 in

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attorneys’ fees and $3,647.26 in costs incurred during the litigation of this matter and the

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case pending in the Court of First Instance between DDR Del Sol and the tenant, IRMG.

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There is no dispute that Defendant Cajun and Grill of America, Inc. guaranteed the

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payments set forth in Schedule B of the 2009 Modification. Defendant argues, however,

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that it is not obligated to pay the attorneys’ fees and costs incurred by DDR Del Sol in

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litigating the matter in state court against the tenant IRMG.

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The Guaranty states, in pertinent part:

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[T]he undersigned, jointly and severally among themselves and with
Tenant, hereby guarantee(s) to Landlord (a) the full and prompt payment of
the Rent, additional rent and any and all other sums payable by Tenant
under the Lease, and (b) the full and timely performance and observance of
all terms and conditions to be performed and observed by Tenant under the
Lease: and the undersigned, jointly and severally among themselves and
with Tenant, hereby covenant(s) and agree(s) to and with Landlord that if
default shall at any time be made in (i) the payment, when due, of any or
(ii) Rent, additional rent and/or other sums payable under the Lease, or (iii)
the prompt performance and observance of any of the terms or conditions
contained in the Lease, the undersigned shall forthwith pay such Rent,
additional rent and/or other sums (and any arrears of any of the same) to
Landlord and shall forthwith perform and fulfill all of such terms and
conditions of the Lease, and shall forthwith pay to Landlord all damage;
that may arise in consequence of any default by Tenant under the Lease,
including (without limitation) all attorneys’ fees and disbursements
incurred by Landlord in connection with any such default and/or in
connection with the enforcement of the Lease and/or this Guaranty,
whether or not suit be brought (and if suit be brought, through all appellate
actions and proceedings, if any.)

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(ECF No. 15-4 at 13) (emphasis added). “[W]hen a contractual fee provision is included

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by the parties, the question of what fees are owed is ultimately one of contract

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interpretation, and our primary obligation is simply to honor the agreement struck by the

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parties.” AccuSoft Corp. v. Palo, 237 F.3d 31, 61 (1st Cir. 2001) (citation and internal

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quotation marks omitted). “[I]nterpreting agreements and their scope is a matter of state

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contract law.” Fábrica de Muebles J.J. Álvarez, Inc. v. Inversiones Mendoza, Inc., 682

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F.3d 26, 33 (1st Cir.2012).

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Under the terms of the Guaranty, Defendant Cajun and Grill of America, Inc., is

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obligated to pay Plaintiff DDR Del Sol all attorneys’ fees associated with the

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enforcement of the 1998 Lease, as amended, and the Guaranty. However, the court may

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read into the contract a requirement that the requested fees be reasonable. We find that

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Plaintiff DDR Del Sol is entitled to attorneys’ fees and costs pursuant to the terms of the

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Guaranty. The amount of the award, however, remains to be determined.

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Plaintiff DDR Del Sol shall move for attorneys’ fees within fourteen (14) days of
this order and in compliance with Fed. R. Civ. P. 54.
Conclusion

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For the aforementioned reasons, the court GRANTS Plaintiff DDR Del Sol’s

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motion for reconsideration (ECF No. 46), reverses its earlier finding that a genuine

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question of material fact remains (ECF No. 44), and GRANTS summary judgment

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against Defendant Cajun and Grill of America, Inc., in the amount of $227,434.22 in past

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due rent owed under the payment plan, plus interest, late charges, and reasonable

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attorneys’ fees incurred (ECF No. 18).

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Judgment in favor of Plaintiff DDR Del Sol, S.E. will be entered accordingly.

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IT IS SO ORDERED.

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San Juan, Puerto Rico, this 18th day of December, 2015.

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S/José Antonio Fusté
JOSE ANTONIO FUSTE
U. S. DISTRICT JUDGE