Court Opinion

ID: 2732617
Source: CourtListenerOpinion
Date Created: 2014-09-12 19:00:32.181151+00
Date Added: 2024-06-11T10:03:17.762129
License: Public Domain

UNPUBLISHED

                  UNITED STATES COURT OF APPEALS
                      FOR THE FOURTH CIRCUIT

                               No. 13-2335

BV RETAIL, LLC,

                Plaintiff – Appellee,

          v.

JAMES M. DONNELLY; STACY D. TAKATS

                Defendants - Appellants.

Appeal from the United States District Court for the Western
District of North Carolina, at Charlotte.    David Shepardson
Cayer, Magistrate Judge. (3:12-cv-00348-DSC)

Submitted:   August 28, 2014             Decided:   September 12, 2014

Before KING and THACKER, Circuit Judges, and HAMILTON, Senior
Circuit Judge.

Affirmed by unpublished per curiam opinion.

Fred M. Wood, Jr., C. Bailey King, Jr., Timothy P. Lendino,
SMITH MOORE LEATHERWOOD LLP, Charlotte, North Carolina, for
Appellant.     William R. Terpening, Matthew S. DeAntonio,
Jonathan E.   Schulz,   NEXSEN PRUET, PLLC, Charlotte, North
Carolina, for Appellee.

Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:

            A jury returned a verdict of $126,908.27 against James

M.    Donnelly    and    Stacy   D.     Takats    (the    Donnellys).      The   jury

determined that a Termination of Lease (Termination Agreement)

did not extinguish the Donnellys’ obligations as guarantors of

a lease between BV Retail, LLC (BV Retail) and Emerson Joseph,

LLC (Emerson Joseph).            The Donnellys now appeal, arguing that

the    district    court    erred       when    it   denied   their     post-verdict

judgment as a matter of law. *            We affirm.

            The    Donnellys      were     owners    of   Emerson     Joseph,    which

leased space in a shopping center owned by BV Retail.                       As part

of the transaction, the Donnellys signed a Guaranty of Lease

(Guaranty),       in    which    they    personally       guaranteed     payment   of

Emerson    Joseph’s      rent.        Emerson    Joseph    encountered     financial

difficulties and fell behind on its rent.                   Subsequently, Emerson

Joseph and BV Retail executed the Termination Agreement.

            BV Retail sued to enforce the Guaranty, claiming that

the Donnellys were liable as guarantors for rent and other fees.

The Donnellys moved for summary judgment, asserting that the

Termination       Agreement      plainly       extinguished    their    obligations

under the Guaranty.             The district court ruled that a genuine

       *
       Although BV Retail disputes that such a post-verdict
motion was made, the district court docket sheet reflects that
it was. We accordingly will review the denial of the motion.

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issue of material fact existed on this issue.               Accordingly, the

court denied the Donnellys’ motion for summary judgment.

             Following   trial,        the    jury    determined      that    the

Termination     Agreement    did       not     extinguish   the       Donnellys’

obligations.     The verdict of $126,908.27 represented primarily

the amount of unpaid rent accrued prior to execution of the

Termination    Agreement.       Following      the   verdict,   the    Donnellys

moved for judgment as a matter of law, again asserting that the

Termination     Agreement   clearly      and    unambiguously      ended     their

obligations under the Guaranty.              The district court denied the

motion.

             On appeal, the Donnellys claim that the district court

erred when it denied their motion.             “We review de novo the legal

conclusions upon which the district court’s denial . . . [was]

premised.”     Belk, Inc. v. Meyer Corp. U.S., 679 F.3d 146, 164

(4th Cir. 2012).

             Application of basic contract principles compels our

conclusion that the district court’s ruling was correct. The

Termination Agreement provided, “As of October 28, 2011 . . . ,

the Lease shall be terminated and the Leased Premises shall be

surrendered     to   Landlord     by    Tenant.        Accordingly,     neither

Landlord nor Tenant shall have any further duties, obligations,

or liabilities under the Lease from and after the Termination

Date.”    Further, various provisions of the Guaranty provide that

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the Donnellys’ liability as guarantors would survive an event

such as a lease termination.                   For instance, the Guaranty states

that it “is a continuing Guaranty, and the liability of the

Guarantor     .     .    .   shall     in     no       way   be    affected,       modified   or

diminished        by     reason   of     .    .        .   any    dealings,    transactions,

matters or things occurring between the Landlord and Tenant.”

The Guaranty additionally states that its “validity . . . and

the obligations of the Guarantor . . . shall not in any way be

terminated . . . by reason of the termination of the Lease so

long as the Tenant continues to be liable.”

              The       above     passages,            construed        together,     strongly

suggest that Emerson Joseph was released from its obligation

under the Lease for rent accrued after October 28, 2011, but

that    Emerson         Joseph—and      the    Donnellys           as    guarantors—remained

liable for past-due rent.                    The district court did not err in

concluding that the Termination Agreement did not, as a matter

of     law,   extinguish          the        Donnellys’           obligations       under     the

Guaranty.

                  We     accordingly         affirm.              We    dispense    with    oral

argument because the facts and legal contentions are adequately

presented in the material before the court and argument would

not aid the decisional process.

                                                                                      AFFIRMED

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