Title: Wedderien v. Collins
Citation: N/A
Docket Number: 102, 2007
State: Delaware
Issuer: Delaware Supreme Court
Date: November 6, 2007

IN THE SUPREME COURT OF THE STATE OF DELAWARE 
 
PETER A. WEDDERIEN, 
 
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§ 
No. 102, 2007 
 
Plaintiff Below- 
  
 
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Appellant,  
 
 
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Court Below:  Superior Court 
 
 
 
 
 
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of the State of Delaware in and 
 
 
 
 
 
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for Sussex County 
v. 
 
 
 
 
 
§ 
 
 
 
 
 
 
§ 
ALAN S. COLLINS, JR.  & 
 
§ 
C.A. No. 05L-12-031 
ANGELA M. COLLINS  
 
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§ 
 
 
Defendants Below- 
 
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Appellees.  
 
 
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§ 
 
Submitted:  August 28, 2007 
   Decided:   November 6, 2007 
 
Before STEELE, Chief Justice, JACOBS, and RIDGELY, Justices. 
 
O R D E R 
This 6th day of November 2007, it appears to the Court that: 
(1) Appellant Peter A. Wedderien appeals the Superior Court’s dismissal of 
his complaint seeking a Writ of Scire Facias Sur Mortgage and an in personam 
judgment against Appellees Alan S. Collins, Jr. and Angela M. Collins (“Collins”). 
He also appeals the Superior Court’s entry of judgment against him on Collins’s 
counterclaim. After a bench trial, the Superior Court found Wedderin’s complaint 
to be premature and that he breached his contract with Collins by failing to pay 
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certain taxes, as promised in their agreement and bill of sale for a business.  We 
find no merit to Wedderien’s appeal and affirm. 
(2) Broad Creek Enterprises is a Delaware Corporation that owns real 
property in Sussex County that is the location for The Pit Restaurant.  Wedderien 
owned all of the common stock of Broad Creek.  On July 28, 2002, Wedderien and 
Collins signed a Contract of Sale for the real property and his stock.  In the 
contract, Wedderien and Broad Creek Enterprises promised to deliver to Collins all 
documents “demonstrating that no taxes are outstanding against the business or 
assets as of the date of closing.”1  Wedderien and Broad Creek Enterprises also 
represented that state and federal taxes related to the business that were due and 
owing at the time of sale had been or would be paid in full by the closing date. 
(3) On August 28, 2002, Wedderien and Collins signed an Agreement and 
Bill of Sale for the Business and Broad Creek Enterprises.2  Closing took place that 
day.  As part of the consideration for the contract and the agreement, Collins 
delivered a promissory note, secured by a second mortgage to Wedderien.  At 
                                          
 
1 Taxes for purpose of this section of the contract included “any and all business related taxes, 
including but not limited to gross receipts sale taxes, state and federal employee income tax 
withholding, federal social security tax withholdings, employment taxes, unemployment 
compensation taxes and any business or license fees.” 
2 The assets of the corporation included personal property and the alcohol beverage license 
related to the Operation of the Pit Restaurant.  The total purchase price was $260,000. 
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closing, both parties were represented by the same attorney who drafted all 
documents. 
(4) Beginning in September 2003, Wedderien stopped receiving payments 
from Collins.  He retained an attorney who contacted Collins on February 11, 2004 
to give notice of default and an opportunity to cure with late fees as required by 
Paragraph 6 of the note.3  The note Collins signed had the following provision 
regarding failure to pay:   
6. BORROWER’S FAILURE TO PAY AS REQUIRED 
(A) Late Charge for Overdue Payments.  If the Note Holder has not 
received the full amount of any monthly payment by the end of 15 
calendar days after the date it is due, I will pay a late charge to the 
Note Holder.  The amount of the charge will be 5% of my overdue 
payment of principal and interest.  I will pay this late charge promptly 
but only once on each late payment. 
(B) Default.  If I do not pay the full amount of each monthly payment 
on the date it is due, I will be in default. 
(C)  Notice of Default.  If I am in default, the Note Holder may send 
me a written notice telling me that if I do not pay the overdue amount 
by a certain date, the Note Holder may require me to pay immediately 
the full amount of principal which has not been paid and all the 
interest that I owe on that amount.  That date must be at least 30 days 
after the date on which the notice is delivered or mailed to me. 
The relevant terms of the mortgage provide that “if any installment is overdue and 
unpaid for a period of thirty (30) days following its due date, the holder hereof 
                                          
 
3 The five missing payments were for September 2003-January 2004. 
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may, at its option, declare the entire unpaid principal balance immediately due and 
payable.” 
(5) On March 18, 2004, Collins provided a check to cover the five 
outstanding monthly payments through his attorney, but refused to pay any late 
fees because he did not have notice of Wedderien’s new mailing address.4  Collins 
also notified Wedderien that he had received a notice from the IRS that Broad 
Creek Enterprises owed approximately $3,233.39, exclusive of $308.98 that the 
IRS had deducted from Broad Creek Enterprises’ most recent tax overpayment.  At 
trial, Collins testified that the outstanding IRS amount was incurred during the 
month of August 2002. 
(6) Wedderien continued to receive the monthly payments from March 
2004 through July 2005, although they were regularly twenty or twenty-five days 
late.5  Collins’s August check for payment was returned to Wedderien by his bank 
on October 26, 2005 for insufficient funds (the “NSF Payment”).  Through his 
attorney, Wedderien sent another letter to Collins dated November 30, 2005 (the 
                                          
 
4 Approximately eight months after closing, Wedderien moved from Sussex County to North 
Carolina.  Prior to moving, he contacted the post office to forward his mail and testified that he 
notified Collins of this move by letter.  At trial, Wedderien testified that he did not make a copy 
of the letter, and Collins testified that he never received any notice from Wedderien.  While in 
North Carolina, Wedderien moved to three different cities in the course of a year and a half. 
5 Despite receiving the March 18 letter from Collins and acknowledging receipt and payment of 
the outstanding balances less late fees, Wedderien sent another letter on December 13, 2004 to 
Collins notifying him that he was still in default from not paying the September 2003-January 
2004 installments and that the mortgage would be accelerated unless the default was cured by 
January 15, 2005. 
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“November Letter”).  This letter, titled “Notice of Default and Acceleration,” 
informed Collins that because of the NSF Payment and because he had not 
received payments in October and November, Collins was in default of the 
mortgage, and Wedderien was accelerating the mortgage under the relevant 
provisions of the note.6  The letter provided Collins with the total amount due plus 
penalties and interest, and demanded that he pay it within fifteen days.7 
(7) On December 12, 2005 Collins paid the August 2005 installment with a 
late fee.  Five days later, Wedderien commenced this action on the mortgage and 
the note even though all previously due monthly installments had been paid.  
Wedderien also continued to accept monthly payments from Collins after the filing 
of the Amended Complaint.8  In their Answer, Collins denied any default and 
counterclaimed for breach of contract against Wedderien based upon the 
outstanding tax debt owed by Broad Creek Enterprises prior to the sale on January 
18, 2006.  The case proceeded to trial before a Superior Court Judge. 
(8) After each party presented evidence, the trial judge interpreted the 
terms of the note and mortgage regarding notice of default.  He found that together 
                                          
 
6 At trial, Wedderien explained that although Collins had made the October and November 
payments, he had applied them retroactively to cover the August and September payments.   
7 Wedderien, in the Pre-Trial Stipulation, later conceded that the total amount demanded in the 
letter was incorrect because it ignored monthly payments received by Wedderien prior to 
November 30, 2005.   
8 The Amended Complaint was signed December 30, 2005. 
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they required the note holder to send written notice of default, and the borrower 
would have 30 days to cure before the note holder could accelerate and demand the 
full amount of unpaid principal plus interest due.  The trial judge also determined 
that because the November Letter did not properly give notice prior to the demand 
for accelerated payment, Wedderien’s complaint was premature.  On the 
counterclaim, the trial judge considered Wedderien’s testimony and found that 
both he and Broad Creek Enterprises promised that the debts related to the IRS 
notice would be paid before the August 28 closing date.  Thus the amount owed to 
the IRS related to payments incurred in August 2002 when Wedderien still owned 
the business.  Alternatively, the trial judge found that Collins was a third-party 
beneficiary of the promise made by Wedderien on behalf of the corporation.  The 
court then awarded Collins $4,282.42, representing the current amount due based 
on the IRS’s most recent notice plus the amount taken from Collins’s overpayment 
in 2003.  This appeal followed. 
(9) Wedderien first argues that the NSF Payment put Collins in default and 
justified his acceleration of the Mortgage.  According to Wedderien, the terms of 
the mortgage did not require him to give Collins any opportunity to cure a default.  
According to Wedderien, the November Letter correctly provided Collins notice of 
acceleration, which Wedderien set at fifteen days from the date of the letter.  We 
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review interpretations of contract language and the trial court’s legal conclusions 
de novo.9 
(10) The relevant terms of the note are clear and unambiguous.  The failure 
to pay the full amount of each monthly payment on its due date puts the borrower 
in default.  Because of Collins’s NSF Payment, of which Wedderien received 
notice on October 26, 2005, Collins was then in default under Paragraph 6(B) of 
the note.  Wedderien applied Collins’s subsequent monthly payments toward the 
NSF Payment, leaving a recurring negative balance for the mortgage.  Regardless 
of how Wedderien accounted for Collins’s payments, at the time of the November 
Letter, Collins was one month behind in his payments.  We concluded that 
Wedderien properly exercised his option to invoke Paragraph 6(C), as he had on 
two previous occasions. 
(11) Because Collins was in default, Paragraph 6(C) permitted Wedderien to 
send a written notice of the due date for the overdue amount.  This due date had to 
be 30 days after the date on which the notice was mailed, which would have been 
30 days after November 30, or December 30.  The Superior Court concluded that 
Wedderien could not unilaterally shorten this time to fifteen days, as he purported 
                                          
 
9 Seaford Golf & Country Club v. E.I. duPont de Nemours & Co., 925 A.2d 1255, 1261 (Del. 
2007) 
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to do in the November Letter.  Collins paid the outstanding balance plus penalties 
on December 22, within the 30-day period required by the note.   
(12) The parties dispute the availability of a specific period of time to cure 
the default.  The Superior Court found that the mortgage and note had to be 
construed together to determine the parties’ intentions.10  Because the mortgage 
was silent on how Wedderien could make a declaration that the entire balance was 
due and payable, the trial judge read them together and found that Paragraph 6(C) 
of the note controlled.  We agree.   
(13) The relevant provisions of the note unambiguously provide that in the 
case of a default of the mortgage, notice and an opportunity to cure must be given 
prior to the note holder’s acceleration of the entire debt.  In other words, the plain 
language of Paragraph 6(C) provided for acceleration only if Collins failed to pay 
the default after receiving the requisite 30 days notice.  Here, Collins cured the 
default within 30 days of the mailing of the notice of default.  The Superior Court 
did not err in concluding that Wedderien’s complaint was premature. 
(14) Next, Wedderien argues that the counterclaim should have been 
dismissed for three reasons: the claim violated the statute of limitations, Collins 
                                          
 
10 Metro. Life Ins. Co. v. Monroe Park, 442 A.2d 503, 507 (Del. Super. Ct. 1982) (“It is the usual 
view that the mortgage and a note or bond secured by it are considered part of one transaction 
and, where possible, construed together in order to gain the intentions of the parties.”), rev’d on 
other grounds, 457 A.2d 734 (Del. 1983). 
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failed to present sufficient evidence to support the counterclaim during trial, and 
Collins lacked standing to assert the claim on behalf of Broad Creek Enterprises.  
We review the factual findings of a judge during a bench trial to determine whether 
they are clearly erroneous and not supported by credible and sufficient evidence in 
the record.11  For questions involving mixed questions of law and fact, our review 
is de novo.12 
(15) The statute of limitations for a breach of contract claim is three years.13  
The evidence showed that the IRS notice to Collins regarding the outstanding 
balance was dated August 11, 2003 for the tax period ended September 30, 2002.  
Thus, Collins’s filing of his counterclaim on January 18, 2006 was within the 
required limitations period.  Wedderien’s assertion that Collins’s claim is outside 
the statute of limitations is without merit. 
(16) Wedderien also argues that Collins presented insufficient evidence for 
the court to find that the amount due from the IRS notice covered the period prior 
to the August 28, 2002 sale when he owned the business.  Particularly because the 
notice covered the tax period that ended on September 30, 2002, Wedderien argues 
that the amount due to the IRS could have included the month of September, when 
                                          
 
11 Homestore, Inc. v. Tafeen, 888 A.2d 204, 217 (Del. 2005); Levitt v. Bouvier, 287 A.2d 671, 
673 (Del. 1972). 
12 Zirn v. VLI Corp., 681 A.2d 1050, 1055 (Del. 1996) (discussing the scope of this review). 
13 DEL. CODE ANN. tit. 10, § 8106 (1999). 
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Collins owned the business.  Wedderien’s argument ignores Collins testimony that 
the period reflected in the IRS notice was “for the third quarter, which was—the 
month was August that it wasn’t paid.”  The IRS notices were exhibits at trial and 
the trial judge accepted Collins’s testimony.  The findings of fact are sufficiently 
supported by the record and are not clearly erroneous. 
(17) Wedderien’s last argument is that Collins lacked standing.  Although 
this issue was raised as an affirmative defense in the answer which was filed, 
Wedderien did not raise the issue by motion or at trial.  Because he did not, he is 
precluded from raising this issue on appeal.14 
NOW, THEREFORE, IT IS ORDERED that the judgment of the Superior 
Court is AFFIRMED. 
 
BY THE COURT: 
 
/s/ Henry duPont Ridgely 
 
 
 
 
 
 
 
Justice 
                                          
 
14 Del. Supr. Ct. R. 8.  Even if we did consider his standing claim, Wedderien’s argument would 
fail.  Wedderien argues that Collins is not suffering any injury-in-fact because Broad Creek 
Enterprises is the party being penalized by the IRS in its regular application of the Business’s 
overpaid employment taxes against the outstanding debt created by Wedderien, which would 
make them an indispensable party to the counterclaim.  However, one of the Superior Court’s 
findings was that Collins, in his personal capacity, was “clearly [a] third-party beneficiar[y] of 
[Wedderien’s] promise [to pay the debts owed by Wedderien and Broad Creek Enterprises prior 
to the date of closing].”