Jurisdiction in this matter arises under 28 U.S.C. § 1332. Landlord is a citizen of 1

Pennsylvania. Complaint ¶ 1. Tenant is incorporated under the laws of Delaware with its

principal place of business in New York. Id. ¶ 2. 

There is no allegation that Tenant failed to pay rent. 2

1

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

OXFORD ASSOCIATES REAL

ESTATE, L.P.

v.

TSI SOCIETY HILL, INC.

: CIVIL ACTION 

:

: NO. 05-CV-4445

:

:

:

MEMORANDUM AND ORDER

Kauffman, J. March 6, 2006

Plaintiff Oxford Associates Real Estate, L.P. (“Landlord”), a commercial landlord,

confessed judgment against Defendant TSI Society Hill, Inc., its tenant (“Tenant”). The parties 1

are in the middle of a valuable fifteen-year commercial lease for a property where Tenant has

made substantial improvements. At issue is the timeliness of the payment of approximately

$12,000 in real estate taxes. Now before the Court is Tenant’s Motion to Open Confessed

Judgment pursuant to Fed. R. Civ. P. 60(b). For the reasons that follow, the Court will grant the

Motion. 

I. Background

On December 17, 1997, the parties entered into a fifteen-year lease (“Lease”) for real

property consisting of 20,000 square feet located in Philadelphia, Pennsylvania for an annual rent

of $260,000. Complaint, Ex. A (Lease) §§ 1.02, 2.01. Tenant uses the leased premises to 2

operate a health and fitness club where it services approximately 7,000 to 8,000 members every

week. Tenant Mem. at 6, Ex. B (Decl. of John Smallwood (“Smallwood Decl.”)) ¶ 2. After the

Case 2:05-cv-04445-BWK Document 17 Filed 03/07/06 Page 1 of 6
2

initial term of the Lease, Tenant has a right of renewal. Lease Addendum No. 1 § 10. 

Pursuant to the Lease, Tenant is responsible for paying its proportionate share of the

annual real estate taxes assessed against the premises. Lease at § 2.02(a). In addition, Tenant is

responsible for the repair, maintenance, and replacement of the swimming pool and its related

mechanics and surrounding area. Id. at § 1.05. 

The Lease expressly provides that all notices to Tenant must be sent to Alexander

Alimanestianu, Esquire (“Alimanestianu”), Executive Vice President of Town Sports

International, Inc., Tenant’s parent company (“Town Sports”), with a copy to Nicholas T.

Donovan, Esquire (“Donovan”), a partner in the law firm that represented Tenant in connection

with the Lease. Id. at § 12.05. Landlord is authorized to terminate the Lease and to confess

judgment if (1) Tenant fails to make payment “of any rental or other charges due” under the

Lease or “fails to perform any other of the terms, conditions or covenants” of the Lease; (2)

Landlord provides written notice of the default; and (3) Tenant fails to cure the default within

thirty days or within fifteen days if the default is in respect of a monetary obligation. Id. at § 9.01

(emphasis added). 

On May 12, 2005, Landlord sent a letter requesting that Tenant “cure its default” by May

27, 2005, and pay $12,005.94 for its share of real estate taxes. Complaint, Ex. C. Tenant claims

it never received the May 12th letter, Smallwood Decl. ¶ 4, which, in any event, was

misaddressed. This purported notice was not sent to Alimanestianu with a copy to Donovan as

required by the Lease. UPS tracking information reveals that someone named “Gooden” signed

for the package containing the letter but Gooden is not an employee of Tenant. Tenant Mem. Ex.

I (Decl. of Jenny Sinert (“Sinert Decl.”)) ¶ 3. 

On June 6, 2005, Landlord sent Tenant a letter properly addressed to Alimanestianu with

a copy to Donovan “kindly requesting” payment of the real estate taxes, but failing to even

Case 2:05-cv-04445-BWK Document 17 Filed 03/07/06 Page 2 of 6
3

mention default. Complaint, Ex. D. 

On June 10, 2005, Landlord sent Tenant a letter addressed to John Smallwood

(“Smallwood”), the Director of Real Estate and Development for Town Sports, with copies to

Alimanestianu and Donovan. Landlord Opp. Mem. Ex. 7. This letter referred to a telephone call

between Landlord and Smallwood a day earlier during which Landlord allegedly confirmed that

Tenant “would cure the default in accordance with the terms of its lease.” Id.

On June 24, 2005, allegedly within the fifteen-day cure period provided by the Lease,

Tenant mailed to Landlord a check dated June 21, 2005 for the real estate taxes. Tenant Mem.

Ex. K (Declaration of Robert Herbst (“Herbst Decl.”)) ¶ 3. That same day, Landlord sent a letter

to Alimanestianu and Donovan, stating that it was terminating the Lease based on Tenant’s

failure to pay $12,005.94, its share of real estate taxes. Complaint, Ex. E. Also on that day,

Landlord sent Tenant a Notice to Quit, asserting that Tenant had violated the Lease when it failed

to make a timely payment of its share of real estate taxes and, for the first time, asserted that

Tenant had failed to properly repair, maintain, and replace the pool and its related mechanics and

surrounding area. Complaint, Ex. F. 

On July 27, 2005, Landlord filed a complaint against Tenant in confession of judgment in

ejectment for possession of real property in the Court of Common Pleas of Philadelphia County. 

On August 22, 2005, Tenant removed the action to this Court, filed a motion to open the

confessed judgment, and filed a motion to stay execution. On September 13, 2005, the parties

stipulated that (1) Landlord would stay all efforts to evict Tenant or otherwise execute on its

confessed judgment pending the Court’s resolution of the motion to open confessed judgment;

(2) Tenant agreed to post a bond in the amount of $50,000; and (3) Tenant agreed to continue

paying its monthly rent without prejudice to either party’s position in the litigation.

 II. Legal Standard

Case 2:05-cv-04445-BWK Document 17 Filed 03/07/06 Page 3 of 6
Landlord argues that Tenant’s affidavits are not admissible. However, Pa. R. Civ. 3

P. 2959(e) provides that the Court “shall dispose of [the motion to open judgment] on petition

and answer, and on any testimony, depositions, admissions and other evidence.” Pa. R. Civ. P.

2959(e) (emphasis added); see Mountbatten Sur. Co. v. Jenkins, No. 02-8421, 2003 U.S. Dist.

LEXIS 4055, at *18-19 (E.D. Pa. Mar. 17, 2003) (considering the defendants’ affidavits in its

evaluation of the defendants’ motion to open confessed judgment).

Landlord does not respond to Tenant’s assertion that the issues relating to the pool

cannot constitute a default since Landlord never served Tenant with written notice of a default

relating to the pool that would provide an opportunity to cure. 

4

The procedure for opening a confessed judgment is governed by Fed. R. Civ. P. 60(b). 

FDIC v. Deglau, 207 F.3d 153, 161 (3d Cir. 2000). State law governs the substantive aspects of

a motion to open confessed judgment. Id. at 167. In Pennsylvania, the petitioner must present

“clear, direct, precise and ‘believable’ evidence” of a meritorious defense. Suburban Mech.

Contractors, Inc. v. Leo, 502 A.2d 230, 232 (Pa. Super. Ct. 1985) (quoting Pennsylvania Bank,

N.A. v. Lehr, 438 A.2d 600, 606-07 (Pa. Super. Ct. 1981)). The court must consider the

evidence in the light most favorable to the petitioner and accept as true all evidence and make all

proper inferences in the petitioner’s favor. Deglau, 207 F.3d at 168 (citing Suburban Mech.

Contractors, 502 A.2d at 232). If sufficient evidence is produced “which in a jury trial would

require the issues to be submitted to the jury,” a motion to open confessed judgment will be

granted. Pa. R. Civ. P. 2959(e). 

III. Analysis

Landlord argues that Tenant has failed to produce sufficient evidence that it did not

receive proper written notice of a default before June 10, 2005. 

3

The Lease provides that notice shall be given in the following manner:

Any notice, demand, request, or other instrument which may be or is required to be

given under this Lease shall be sent by United States certified mail, return receipt

requested, postage prepaid, or via recognized overnight carrier and shall be

addressed: . . . to Tenant, at Alexander Alimanestianu, Esq, Town Sports

International, Inc. . . . with copy to Nicholas T. Donovan, Donovan & Giannuzzi[.]

Case 2:05-cv-04445-BWK Document 17 Filed 03/07/06 Page 4 of 6
5

Lease § 12.05. The Lease thus expressly provides that Landlord (1) must provide written notice

of a default and (2) must send the notice to Alimanestianu with a copy to Donovan. Viewing the

evidence in the light most favorable to Tenant, the Court finds that Tenant did not receive written

notice of default for failure to pay its $12,005.94 portion of the real estate taxes until it received

the June 10, 2005 letter. 

The misaddressed May 12, 2005 letter indisputably failed to comply with the notice

requirements of the Lease. The June 6, 2005 letter also did not constitute proper notice of a

default. In this letter, Landlord simply requested that Tenant pay its share of the real estate taxes,

but does not even mention default. The June 10, 2005 letter was thus the first writing that could

be construed to comply with the notice requirements of the Lease.

However, assuming that the June 10th letter was proper written notice of default, Tenant

cured the default when it mailed the check to Landlord on June 24, 2005, within the fifteen-day

cure period provided by the Lease. Herbst Decl. ¶ 3. While Landlord claims that Tenant did not

mail the check until June 30, 2005, the Court must view the evidence in a light most favorable to

Tenant. See Deglau, 207 F.3d at 168. The Court thus finds that Tenant has presented sufficient

evidence to present to a jury that it cured its relatively minor default within the cure period. To

rule otherwise would be manifestly unjust. Accordingly, the Court will open the confessed

judgment. 

IV. Conclusion

For the foregoing reasons, the Court will grant Tenant’s motion to open confessed

judgment. An appropriate Order follows.

Case 2:05-cv-04445-BWK Document 17 Filed 03/07/06 Page 5 of 6
6

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

OXFORD ASSOCIATES REAL

ESTATE, L.P.

v.

TSI SOCIETY HILL, INC.

: CIVIL ACTION 

:

: NO. 05-CV-4445

:

:

:

ORDER

AND NOW, this 6 day of March, 2006, upon consideration of Defendant’s th

Motion to Open Confessed Judgment (docket no. 3) and Plaintiff’s opposition thereto, and the

arguments presented at the Hearing held on August 29, 2005, it is ORDERED that Defendant’s

Motion is GRANTED and the Judgment is OPENED for the reasons stated in the accompanying

Memorandum. 

BY THE COURT:

/s/ Bruce W. Kauffman 

BRUCE W. KAUFFMAN, J.

Case 2:05-cv-04445-BWK Document 17 Filed 03/07/06 Page 6 of 6