UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

No. 14-1484

IHFC PROPERTIES, LLC,

Plaintiff - Appellee,

v.

WHALEN FURNITURE MANUFACTURING, INC.,

Defendant - Appellant,

and

APA MARKETING, INC.,

Defendant.

No. 14-1536

IHFC PROPERTIES, LLC,

Plaintiff - Appellant,

v.

WHALEN FURNITURE MANUFACTURING, INC.,

Defendant - Appellee,

and

APA MARKETING, INC.,

Defendant.
2

Appeals from the United States District Court for the Middle 

District of North Carolina, at Greensboro. Thomas D. Schroeder, 

District Judge. (1:10-cv-00568-TDS-LPA)

Submitted: April 27, 2015 Decided: June 11, 2015

Before GREGORY and HARRIS, Circuit Judges, and DAVIS, Senior 

Circuit Judge.

Affirmed by unpublished per curiam opinion.

Randal S. Waier, LAW OFFICES OF RANDAL S. WAIER, Newport Beach, 

California, for Appellant. Andrew S. Lasine, KEZIAH GATES LLP, 

High Point, North Carolina, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
3

PER CURIAM:

Following a bench trial, the district court concluded that 

Whalen Furniture Manufacturing, Inc. (“Whalen Furniture”), was 

estopped from asserting a statute of frauds defense and awarded 

IHFC Properties, LLC (“IHFC”), $172,470.51, which represented 

the base rent, common area maintenance (“CAM”) charges, Consumer 

Price Index (“CPI”) escalation charges, and showroom taxes 

remaining under the lease that IHFC was unable to mitigate after 

Whalen Furniture vacated IHFC’s property.

Whalen Furniture appeals, arguing that it should not be 

estopped from asserting a statute of frauds defense; 

alternatively, Whalen Furniture contends that it was at most a 

sublessee of APA Marketing, Inc. (“APA Marketing”), which signed 

the original lease, and therefore IHFC lacked privity of estate 

to enforce the contract against it. Whalen Furniture also 

challenges the district court’s damages calculation, asserting 

that it cannot be held liable for the CAM charges and CPI 

escalation charges because it was not on notice of these 

charges. IHFC cross-appeals, arguing that the district court 

should have awarded contractual prejudgment interest and 

attorney’s fees, or, alternatively, statutory prejudgment 

interest. Finding no reversible error, we affirm.
4

I.

“[W]e review judgments stemming from a bench trial under a 

mixed standard: factual findings are reviewed for clear error, 

whereas conclusions of law are reviewed de novo.” Makdessi v. 

Fields, ___ F.3d ____, 2015 WL 1062747 at *4 (4th Cir. Mar. 12, 

2015) (citation and internal quotation marks omitted). “In 

cases in which a district court’s factual findings turn on 

assessments of witness credibility or the weighing of 

conflicting evidence during a bench trial, such findings are 

entitled to even greater deference.” Helton v. AT&T, Inc., 709 

F.3d 343, 350 (4th Cir. 2013). Because the district court was 

exercising its diversity jurisdiction, North Carolina 

substantive law governed. Erie R.R. Co. v. Tompkins, 304 U.S. 

64, 78-80 (1938).

II.

Whalen Furniture first contends that it was not estopped 

from asserting a statute of frauds defense because it did not 

take inconsistent positions regarding a written document to 

which it was a party. “Under a quasi-estoppel theory, a party 

who accepts a transaction or instrument and then accepts 

benefits under it may be estopped to take a later position 

inconsistent with the prior acceptance of that same transaction 

or instrument.” Whitacre P’ship v. Biosignia, Inc., 591 S.E.2d 

870, 881-82 (N.C. 2004). “[T]he essential purpose of quasi-
5

estoppel . . . is to prevent a party from benefitting by taking 

two clearly inconsistent positions.” B & F Slosman v. 

Sonopress, Inc., 557 S.E.2d 176, 181 (N.C. Ct. App. 2001). 

Quasi-estoppel, an equitable doctrine, is “inherently flexible 

and cannot be reduced to any rigid formulation.” Whitacre 

P’ship, 591 S.E.2d at 882.

We conclude that Whalen Furniture was estopped from 

asserting an affirmative defense based on the statute of frauds. 

Whalen Furniture accepted the lease, with knowledge of the 

material terms, when its president informed IHFC’s vice 

president for leasing that Whalen Furniture would take care of 

the rent after confirming that Whalen Furniture had purchased 

either APA Marketing or its assets, and paid the rent for the 

showroom for the October 2008 and April 2009 markets. Whalen 

Furniture then accepted benefits under the lease beyond mere 

occupation of the premises when it conducted a private showing 

for a customer during an off-market time, a privilege only 

extended to leased tenants.

Whalen Furniture argues that its failure to sign a written 

lease is fatal to the district court’s quasi-estoppel analysis, 

asserting that this case is virtually identical to B & F 

Slosman. In B & F Slosman, the defendant occupied space within 

the plaintiff’s property while negotiating for additional space 

within the property. 557 S.E.2d at 178-79. The parties were 
6

unable to reach an agreement, and the defendant vacated the 

premises. Id. When the plaintiff sued, seeking to hold the 

defendant to its proposed lease term, the North Carolina Court 

of Appeals concluded that quasi-estoppel was not appropriate 

because “[t]he fact that defendant occupied the additional space 

during the negotiation process and agreed to pay a monthly rent 

[did] not result in defendant’s taking two inconsistent 

positions.” Id. at 181. Here, however, the district court 

found that Whalen Furniture accepted the terms of the lease and 

enjoyed the benefits of the lease for nearly one year. 

Therefore, its assertion of the statute of frauds is 

inconsistent with its representations that it would honor the 

lease and its acceptance of benefits available only to a 

leaseholder. We therefore conclude that Whalen Furniture was 

estopped from asserting the statute of frauds.

Next, Whalen Furniture asserts that it was at most a 

sublessee of APA Marketing because APA Marketing retained a 

reversionary interest in the showroom. IHFC contends that there 

is no evidence of a subleasing agreement between APA Marketing 

and Whalen Furniture and that the district court properly found 

that Whalen assumed the lease through an oral agreement with 

IHFC.

Under North Carolina law, “a conveyance is an assignment if 

the tenant conveys his entire interest in the premises, without 
7

retaining any reversionary interest in the term itself. A 

sublease . . . is a conveyance in which the tenant retains a 

reversion in some portion of the original lease term, however 

short.” Christensen v. Tidewater Fibre Corp., 616 S.E.2d 583, 

587 (N.C. Ct. App. 2005).

We agree with the district court that there was no evidence 

presented demonstrating that Whalen Furniture was a sublessee of 

APA Marketing. Whalen Furniture’s witnesses testified that it 

paid the rent APA Marketing owed on APA Marketing’s behalf, not 

because Whalen Furniture had agreed to sublet the showroom from 

APA Marketing. Moreover, the district court did not find, as 

Whalen Furniture asserts, that APA Marketing retained a 

reversionary interest in the lease; instead, it found that APA 

Marketing had no need for the IHFC showroom after the asset sale 

to Whalen Furniture because APA Marketing had no more product to 

sell.

III.

Finally, Whalen Furniture challenges the district court’s 

damages calculation, arguing that IHFC did not discuss the 

calculation of CAM charges and CPI escalation charges with 

Whalen Furniture and therefore the court erroneously awarded 

IHFC damages for those charges. To the extent that Whalen 

Furniture is challenging the district court’s factual finding to 

the contrary, we discern no clear error. IHFC’s vice president 
8

testified that he informed Whalen Furniture’s president about 

the outstanding balance for the April 2008 invoice, which 

included CAM and CPI escalation charges, and discussed the 

length of the lease, payment due dates, the termination date of 

the lease, and the rate per square foot. He further stated that 

it was his usual practice to discuss CPI escalation charges with 

tenants, which IHFC understood Whalen Furniture would be, 

because they were part of the payment terms. Moreover, Whalen 

Furniture received a copy of the April 2008 invoice, which 

included CAM charges in “rent” and listed the CPI escalation 

charge for 2008. As the district court noted, Whalen Furniture 

paid these charges without complaint while occupying the 

showroom. On these facts, we discern no clear error.

IV.

In its cross-appeal, IHFC argues that the district court 

erred when it refused to award prejudgment interest at the 

contract rate and attorney’s fees under the contract, contending 

that the knowledge of these terms by APA Marketing’s principals, 

who became Whalen Furniture employees, should be imputed to 

Whalen Furniture. Alternatively, IHFC argues that the district 

court should have awarded statutory prejudgment interest. 

Whalen Furniture responds that IHFC waived these arguments by 

failing to raise them below.
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It is a “settled rule” that this court will not consider 

issues raised for the first time on appeal absent “fundamental 

error or a denial of fundamental justice.” In re Under Seal, 

749 F.3d 276, 285-86 (4th Cir. 2014). “Fundamental error is 

more limited than the plain error standard that [this court]

appl[ies] in criminal cases.” Id. at 285. Thus, this court has 

used the plain error standard “as something of an intermediate 

step in a civil case.” Id. at 286. “[W]hen a party in a civil 

case fails to meet the plain-error standard, we can say with 

confidence that he has not established fundamental error.” Id.

To establish plain error, IHFC must demonstrate “that the 

district court erred, that the error was plain, and that it 

affected [its] substantial rights.” United States v. Robinson, 

627 F.3d 941, 954 (4th Cir. 2010) (internal alterations and 

quotation marks omitted). An error affects substantial rights

if it “affected the outcome of the district court proceedings.” 

United States v. Olano, 507 U.S. 725, 734 (1993). We have

discretion to correct such error only if it “seriously affect[s] 

the fairness, integrity or public reputation of judicial 

proceedings.” Id. at 736 (internal quotation marks and 

alteration omitted).

We have refused, however, to undertake plain error review 

where the party “failed to make its most essential argument in 

its briefs or at oral argument: it never contended that the 
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district court fundamentally or even plainly erred.” In re 

Under Seal, 749 F.3d at 292; see Makdessi, 2015 WL 1062747, at 

*4. Here, IHFC fails to argue in its briefs that the district 

court fundamentally erred or that the elements of plain error 

review are satisfied here. Thus, IHFC has abandoned these 

claims and its “failure to argue for plain error and its 

application on appeal surely marks the end of the road for its 

argument for reversal not first presented to the district 

court.” In re Under Seal, 749 F.3d at 292 (internal alterations 

omitted).

V.

Accordingly, we affirm the district court’s judgment. We 

dispense with oral argument because the facts and legal 

contentions are adequately presented in the material before this 

court and argument will not aid the decisional process.

AFFIRMED