NOT PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

No. 09-3702 BRAUSER REAL ESTATE, LLC

v. MEECORP CAPITAL MARKETS, LLC; MICHAEL EDREI; DANIEL EDREI; GERALD BRAUSER Brauser Real Estate, LLC; Gerald Brauser, Appellants Appeal f rom the United States District Court f or the District of

New Jersey (D.C. Civil No. 02-06-cv-01816) District Judge: Honorable Susan D. Wigenton Argued Septem

ber 14, 2010 Bef ore: RENDELL, FISHER and GARTH, Circuit Judges.

(Filed: June 1, 2012)

Jonathan C. Scott, Esq. [ARGUED] Scott & Scott 2200 Ross Avenue, Suite 5000 Dallas, TX 75201 Counsel for AppellantsDaniel S. Eichhorn, Esq.

Robert L. Ritter, Esq. [ARGUED] Schif f m an, Abraham, Kaufman and Ritter P.O. Box 410 Three University

Plaza Hackensack, NJ 07602 Counsel for Appellees

OPINION OF THE COURT RENDELL, Circuit Judge. Brauser Real Estate, LLC (“BRE”) and Gerald Brauser (“Brauser” ) appeal the District Court’s grant of

sum m ary judgm ent in f

avor of Meecorp Capital Markets, LLC, Michael Edrei, and Daniel Edrei (collectively “Meecorp”), and entry

of f inal judgm ent against BRE, in this breach of contract action. We will aff irm

. On Septem

ber 25, 2003, Plaintif

f BRE executed a Contract of Sale to purchase a thirty -two acre comm ercial property in Florida. On October 10, 2003, Meecorp presented Brauser with a “Letter of

Interest” to supply

the f inancing f

or a purchase of

land in the

am ount of

$28,000,000. Brauser paid a non-ref undable application f

ee of $25,000 in exchange f

or Meecorp’s agreement to enter into a Loan Com m itm ent (“Com m itm ent”) to provide f unding f or the purchase and development of the property . Meecorp prepared the f irst draf t of the Com m itm ent on October 21, 2003, and subsequently exchanged several draf ts and revisions with Brauser and his counsel. From the outset, the draf

t Com m itm ent was addressed to Gerald Brauser, BRE, and Outdoor Digital, and listed Brauser as

2individual guarantor of the Com m itm ent Fee. As part of

the f inal Com m itm ent letter, Meecorp agreed to loan up to $20,000,000 with a f irst m ortgage lien on the property as collateral. The “Acceptance of Com m itm ent” provision in the Com m itm ent provided as f ollows: The com m itm ent and all of its term s and conditions will becom e ef f ective only upon delivery

to this of f ice of a signed copy

of this com m itm ent duly

accepted by the Borrower, accompanied with the com m itm ent f ee installm ent in the am ount of Six Hundred Thousand Dollars ($600,000) which is non-ref undable and earned f or, am ong other things, the com m itm ent to provide f unds and due diligence expenses. (A-1380.) Both Brauser and Meecorp executed the f inal draf t of the Com m itm ent in Decem ber 2003 and Brauser made an initial Com m itm ent Fee pay

m ent of $200,000. The parties m et in March 2004 and Brauser indicated his inability to acquire certain of the required collateral and suggested potential alternative f orm s of collateral. Af ter the m eeting, Meecorp mem orialized its understanding that while it perm itted Brauser to seek other collateral, “the Comm itm ent Letter . . . is the instrum ent that drives the progress of

the proposed Loan.” The required collateral was not provided and the loan never closed. Brauser then requested a ref und of the $225,000 paid in f

ees. W hen Meecorp ref

used to ref

und the f ees and dem anded pay

m ent of the balance of

the Com m itm ent Fee, Brauser f iled suit in Florida state court f or return of

the f ees. Meecorp

rem oved the m atter to the Southern District of Florida and the action was then transf erred to the District of

New Jersey

pursuant to the Com m itm ent’s choice of f orum clause. In the District Court, Meecorp asserted a counterclaim against BRE and Brauser for 3Brauser’s breach of contract, seeking the remainder of the Comm itm ent Fee. Af ter the parties f

iled cross m otions f

or sum m ary

judgm ent, the District Court granted Meecorp’s motion for partial summ ary judgm ent against BRE as the $400,000 balance of

the Com m itm ent Fee was due and owing, noting that “the remaining $400,000

was deferred

to the tim e of

closing,” and “was already earned upon the signing of the Loan Com m itm ent.” Upon Meecorp’s subsequent motion for summ ary judgm ent to recover the $400,000 f

ee f rom Brauser, the court opined that genuine issues of m aterial f act existed regarding whether: (1) Brauser individually guaranteed the entire Loan Com m itm ent f

ee, and (2) alleged material changes m ade to schedule C discharged Brauser’s liability . Bef

ore conducting a trial on these two discrete questions, the District Court granted Meecorp’s motion in limine precluding f rom trial evidence unrelated to the two triable issues, preventing Brauser f rom contesting the validity

of the Com m itm ent and BRE’s obligations thereunder. The District Court then conducted a trial on these lim ited questions and concluded that Meecorp never agreed to adjust the collateral bey ond what Schedule C provided f or in the executed Com m itm ent, and held Brauser individually

liable f or the balance of

the Com m itm ent f

ee. On appeal, BRE and Brauser assert several claims: (1) the District Court erred in f inding that Brauser signed or initialed a collateral schedule to the Comm itm ent and its inclusion in the Com m itm ent served to release Brauser’s guarantee claim; (2) the District Court erred by

precluding Brauser f

rom re-litigating the issue of

whether Outdoor

4Digital’s breach obligated BRE and triggered Brauser’s guarantee; (3) the District Court

erred in f inding a f irm com m itm ent to lend by

Meecorp; (4) the District Court erred in f inding f or Meecorp on issues of

perf orm ance and good f

aith and f air dealing; and (5) the District Court’s award of dam ages was excessive and should be reduced. We will aff irm the District Court’s Judgm ent. 1 DISCUSSION W e review the District Court’s f actual f indings f or clear error. Gordon v. Lewistown Hosp. , 423 F.3d 184, 201 (3d Cir. 2005) (citation om itted). “[ W ]here we are conf ronted with m ixed questions of f act and law, we apply

the clearly

erroneous standard except that the District Court’s choice and interpretation of legal precepts remain subject to plenary review.” Id. (citations om itted). Af ter com pleting discovery

and trial proceedings, the District Court conducted a thorough review of

the docum entation and ruled that Brauser executed the Comm itm ent and the collateral schedules attached thereto. The District Court’s extensive f actual f indings are supported by

the evidence. The record conf irm s that Brauser and his counsel

Af ter hearing oral argument in this case, we rem anded the case to the District 1 Court f or f urther consideration of

the court's diversity

jurisdiction. During the proceedings on remand, additional issues regarding the citizenship of the parties "surf aced". The District Court ultim ately ruled that diversity

jurisdiction did exist. W e received supplemental subm issions f rom the parties on this issue, and we agree with the District Court that Gerald Brauser's belated, inconsistent assertions are lacking in both proof and credibility , and, like the District Court, we conclude that diversity jurisdiction does exist.

5actively

participated in negotiating and draf ting the Com m itm ent, and subsequently signed, initialed and executed the Comm itm ent. Accordingly , the District Court properly held that the obligations stated in the collateral schedule did not materially alter the Com m itm ent, and that Brauser was obligated to abide by the sam e conditions. Subsequent to the trial proceedings, the District Court also determined that Brauser personally

guaranteed the balance of the Com m itm ent Fee. The court conducted a sixstep analy sis to determ ine Meecorp’s eligibility f or a judgm ent against Brauser individually . The plain language of the Com m itm ent’s collateral schedule names Brauser as an individual guarantor, and states that Brauser guaranteed “pay m ent of the rem aining Balance of

the Com m itm ent Fee.” As such, Meecorp possessed the right to “proceed directly against [ him ] as suret[ y ] and cannot be compelled to first sue on the primary obligation.” Salitan v. Magnus , 145 A.2d 10, 13 (N.J. 1958). Brauser has f ailed to raise any persuasive arguments as to why the District Court’s conclusion is incorrect based on the contractual language. Theref ore, we will af

f irm the District Court’s ruling as to Brauser’s personal obligation f or the balance of

the Com m itm ent f

ee, as f urther discussed below. W e next review the District Court’s decision to exclude evidence on a motion in limine f or abuse of

discretion. Houston v. Easton Area Sch. Dist. , 355 Fed. Appx. 651, at *2 (3d Cir. 2009). The District Court granted Meecorp’s motion in limine , precluding Brauser f rom introducing at trial evidence related to several issues previously decided

6against BRE, nam ely , the validity of the Com m itm ent, Meecorp’s entitlement to the

rem aining balance of

the Com m itm ent Fee, and Meecorp’s ability and willingness to perf orm under the Com m itm ent. Brauser asserted that none of the af orem entioned determ inations were binding on BRE, Outdoor Digital, or Brauser since BRE was allegedly not contractually

bound by the Com m itm ent. Despite his protestations to the contrary , the record conf

irm s BRE’s status as a party to the Com m itm ent: (1) Brauser brought the lawsuit on behalf of BRE, rather than Outdoor Digital; (2) the Com m itm ent was addressed to Gerald Brauser, BRE, and Outdoor Digital; and (3) Brauser himself attested in an af

f idavit that BRE executed the Com m itm ent and paid a portion of the Com m itm ent Fee in accordance with the agreement. As such, Brauser’s argum ent that BRE was not a party

to the Com m itm ent or guarantee is unavailing. Accordingly , we will f ind that the District Court did not abuse its discretion by granting Meecorp’s moti on. Finally , we review the District Court’s determination that Meecorp’s prom ise to perf orm was not illusory

and that the Com m itm ent was a valid and enf orceable agreem ent. As an initial m atter, under controlling New Jersey law, “courts should seek to enf orce contracts and avoid deeming them illusory .” Del Sontro v. Cendant Corp.,Inc. , 223 F.2d 563, 578 (D.N.J. 2002) ( citing Russell v. Princeton Labs. Inc. , 231 A.2d 800 (N.J. 1967)). Accordingly , “a prom ise is deem ed illusory and unenf

orceable if perf orm ance is entirely

optional with a prom isor.” Id. ( citing Bryant v. City of Atlantic City , 707 A.2d 1072, 1085 (N.J. Super. App. Div. 1998)). Here, the Comm itm ent

7obligated Meecorp to conduct due diligence and to locate sources of f unding. At the

sam e tim e, the Com m itm ent f urther m andated that Meecorp ref und the entire Com m itm ent Fee if

it f ailed to successf

ully perf orm its obligations under the term s of the agreem ent. As such, Meecorp’s obligations were not “entirely optional.” Del Sontro , 223 F.2d at 578. Additionally , because “an implied obligation t o use good f aith is enough to avoid the f

inding of an illusory

prom ise,” In re Cendant Corp. Litig. , 264 F.3d 286, 300 (3d Cir. 2001) (citation om itted), we will reject Brauser’s challenge to the District Court’s f inding of a non-illusory

prom ise. Sim ilarly , the District Court correctly concluded that the Com m itm ent was valid and enf orceable upon pay

m ent of the $200,000 by

BRE. In addition to the previously

m entioned Acceptance of Com m itm ent provision, which provided that the Com m itm ent would becom e ef

f ective upon execution of

the Loan Com m itm ent letter and pay m ent of $600,000, the Com m itm ent included two relevant provisions that support the District Court’s decision. First, the “W aiver of Trial By Jury ” clause provided that notwithstanding the requirem ent to pay $600,000 at the signing of the com m itm ent, Meecorp would accept pay m ent in two installm ents – $200,000 at signing and $400,000 at closing – in consideration f or the parties’ waiver of

a trial by jury and agreement to a Choice of Forum clause. This installm ent clause conf irm s that the def

erred pay m ent plan constituted an independent agreement between the parties to perform their full obligations under the Com m itm ent, including pay m ent of the entire Com m itm ent Fee in installm ents.

8Separately , the Acceptance of Com m itm ent clause f

urther stipulated that Meecorp would have no obligation to perf orm under the Com m itm ent “unless and until this

com m itm ent letter [ was] f ully executed and received by Meecorp along with the required portion of

the com m itm ent f

ee.” The latter language conf orm s with the District Court’s f inding that the parties anticipated pay m ent of only a “required portion of

the

com m itm ent f

ee” f or the Com m itm ent to becom e binding upon Meecorp and ef f ective as to both parties, rather than pay m ent-in-f ull upon signing. Rather than conditioning pay m ent of the f ull balance upon closing, the installm ent agreement withi n the Com m itm ent m erely

def erred pay m ent of the rem aining balance to a later date to provide Brauser with a f

avorable pay

m ent schedule. Accordingly , Brauser’s execution of the agreem ent and pay

m ent of the “required portion” of $200,000 rendered the Comm itm ent valid and enf

orceable. In this vein, the District Court’s holding regarding the parties’ perf orm ance under the valid Loan Com m itm ent is also correct. As the District Court noted, the record is 2

Brauser’s assertion that Meecorp allegedly violated its im

plied duty

of good f aith 2 and f air dealing is both untim ely and unsubstantiated. The District Court did not address this issue in the second sum m ary judgm ent order, contrary to Brauser’s suggestion, nor do the various pleadings provide any evidence that Brauser previously raised this m atter in the District Court. “[ A]n appellate court may only review the record as it existed at the tim e sum m ary

judgm ent was entered,” and appellants cannot “advance new theor ies or raise new issues in order to secure a reversal of the lower court’s determination.” Union Pac. R. Co. v. Greentree Transp. Truck. Co. , 293 F.3d 120, 126 (3d Cir. 2002); see also Bacon v. Sullivan , 969 F.2d 1517, 1521 (3d Cir. 1992) ( citing Newark Morning Ledger Co. v. United States , 539 F.2d 929, 932 (3d Cir. 1976) (“new issue cannot be considered on appeal if

it was not raised below”)). Even if the question was tim ely , Brauser points to 9devoid of

any evidence supporting Brauser’s assertion that Meecorp lacked the ability to perf orm its obligations pursuant to the Com m itm ent. In contrast, Brauser’s inability to secure the collateral prescribed f or in the Com m itm ent was clearly com m unicated to Meecorp during the March 2004 meeting. As such, the District Court properly held that the record suf

f iciently dem onstrated “the absence of a genuine issue of

m aterial f

act” as to Brauser’s breach of

the Com m itm ent, see generally Miller v. Indiana Hosp. , 843 F.2d 139, 143 (3d Cir. 1988), and appropriately granted sum

m ary judgm ent in Meecorp’s f avor. The District Court’s award of dam ages was sim ilarly

correct. The Comm itm ent expressly provided that BRE – or Brauser as individual guarantor – would pay a total of $600,000 in exchange f

or Meecorp’s bargained-f or due diligence and f

unding, even if

the pay m ents were m ade in installm ents. The Com m itm ent did not provide f or reim bursem ent of

a portion of

the Com m itm ent Fee if

the loan was reduced, even though the Com m itm ent expressly stated that the loan could be reduced based upon a subsequent appraisal. Because the parties voluntarily agreed to a Com m itm ent Fee of $600,000 – 3 no evidence adduced to support his allegation that Meecorp accepted pay m ent without ever intending to lend f

unds to BRE. Brauser contends that the $600,000 Com m itm ent Fee is unreasonable because 3 Meecorp predicated its comm itm ent f ee claim on 3% of a $20 m illion loan, but subsequently

reduced the alleged of

f er to lend to $9.9 m illion. Although the record includes the Final Loan Of f er of $9.9 m illion ref

erenced by

Brauser, (JA-373), the Of f er was never accepted and, is thus, of no legal ef

f ect. Other than the Com m itm ent, which expressly provided f

or a $600,000 f

ee, Brauser did not advance any other legally -binding loan docum ent suggestive of an alternative f

ee calculation. 10which was never revised by agreem ent – we will af

f irm the District Court’s award of dam ages against BRE and Brauser. CONCLUSION For the f oregoing reasons, we will af f irm the District Court’s orders in all respects.

111

Brauser v. Meecorp No. 09 - 3702 GARTH, Circuit Judge , dissenting. I write separately because although I agree with the majority‟s conclusion to the effect that Meecorp‟s C ommitment promise is not illusory

— and is thus enforceable

— I cannot agree that the Me ecorp C ommitment on which Brauser‟s fee is predicated is a $20,000,000 C ommitment. Rather, as Meecorp‟s Final Loan Offer is no more than $9,900,000, I calculate Brauser‟s obligation to be $297,000 (3% of $9,900,000), of which Brauser has already paid $20 0,000

. Meecorp‟s initial letter C ommitment of November 18, 2003 contemplated a loan of $20,000,000 . However, Meecorp carefully conditioned its obligation to lend $20,000,000 on the appraisal of Brauser‟s collateral by stating “the borrower [Brauser] und erstands that Meecorp will inspect the collateral and Meecorp cannot and will not lend more than fifty percent (50%) of the As

- Is market value of the collateral.” Accordingly, after Meecorp appraised Brauser‟s collateral, it withdrew its $20,000,000 Co mmitment in its March 2004 Final Loan Offer. In that Final Loan Offer, Meecorp stated : Pursuant to our commitment Letter dated November 18, 2003 . . . this letter shall constitute our Final Offer to make a loan on the terms and conditions of the Commitm ent, . . . A land acquisition loan of up to Nine Million, Nine Hundred Thousand dollars ($9,900,000) . . . pursuant to the Commitment and the following conditions.

. . As you know, our commitment was issued for an amount not exceeding $20,000,000 limit ed to 50% of the „As

- Is‟ value of the land. . . . Meecorp ordered and received an independent appraisal and it is the opinion of the Appraiser that the “As

- Is 180

- day Sale Value” is $18,000,000. Therefore, we hereby agree to proceed with the initial p hase of the Loan based on the terms and conditions of our Commitment . . . $9,900,000.2

As Meecorp explains in its Final Loan Offer letter, it initially proposed a $20,000,000 loan predicated on the assumption that the land would appraise at a value suffi cient to support such a loan. The language of the loan Commitment expressly stated that the $20,000,000 loan figure was a “ceiling, ” and left open the possibility that the loan amount would be decreased if the land appraised for less than what Brauser rep resented its value to be. Indeed, the loan Commitment stated “[t]he borrower [Brauser] understands that Meecorp will inspect the Collateral and Meecorp cannot and will not lend more than Fifty Percent (50%) of the As

- Is Market Value of the Collateral. . . ” Thereafter, Meecorp conducted its own appraisal and found the land to be worth less than Brauser had represented. It was at that point Meecorp effectively withdrew its $20,000,000 Commitment proposal and replaced it with the Commitment of $9,900,000. Three percent of $9,900,000 is $297,000, and since it is undisputed that Brauser has already paid $200,000, Brauser‟s remaining balance is no more than $97,000. The District Court and the majority of this court have therefore erred when they adjudged that Brauser‟s remaining balance was $400,000 (the remainder of a $600,000 commitment fee minus $200,000 paid by Brauser) . In my view, wholly based upon the documents of record , I would hold that Brauser is obligated to Meecorp for $97,000, and no more. I therefore respectfully dissent from the majority‟s judgment.