DERR Enters. v. Union City Ind. Props., 21A-CC-2305

Citation21A-CC-2305
Case DateSeptember 14, 2022
CourtCourt of Appeals of Indiana

DERR Enterprises, LLC, Appellant-Defendant,
v.

Union City Indiana Properties, LLC, Appellee-Plaintiff

No. 21A-CC-2305

Court of Appeals of Indiana

September 14, 2022


Pursuant to Ind. Appellate Rule 65(D), this Memorandum Decision shall not be regarded as precedent or cited before any court except for the purpose of establishing the defense of res judicata, collateral estoppel, or the law of the case.

Appeal from the Hamilton Superior Court The Honorable Jonathan M. Brown, Judge Trial Court Cause No. 29D02-2002-CC-1726

Attorney for Appellant Christopher J. McElwee Monday McElwee Albright Indianapolis, Indiana

Attorney for Appellee Christopher P. Jeter Massillamany Jeter & Carson LLP Fishers, Indiana

MEMORANDUM DECISION

MAY, JUDGE

[¶1] DERR Enterprises, LLC ("DERR") appeals following the trial court's orders granting summary judgment in favor of Union City Indiana Properties, LLC ("Union City") and denying DERR's motion to correct error. DERR raises one issue on appeal, which is whether the trial court erred by denying DERR's

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motion to correct error because the grant of summary judgment for Union City was erroneous. We reverse and remand.

Facts and Procedural History

[¶2] On July 2, 2018, DERR, a wholesaler of hospitality and restaurant products, agreed to lease a commercial property located at 107 South Main Street in Summitville, Indiana (hereinafter, "the Property"), from Union City, a business that owns and leases commercial real estate. According to the commercial lease agreement, the lease was to run from July 2, 2018, until July 2, 2020. The lease agreement required DERR to pay a base rent of $3,874.00 per month. The agreement also included a clause that stated: "This Agreement contains a complete expression of the agreement between the parties and there are no promises, representations or inducements except such as are herein provided." (App. Vol. II at 30.)

[¶3] DERR began operating its business at the Property, but it eventually became economically unfeasible to continue business operations at the location. On June 27, 2019, Rodi Rozin, DERR manager, emailed Joshua Orahood, the principal owner of Union City:

Hi Josh
As we discussed yesterday over the phone, we have to close our operation in Summitville due to continued weakness in our business. We plan to wind everything down by December 31 2019
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I hope you will work with us to terminate our lease 6 months early.
Please let me know if you need anything else from my side. Jamie and the rest of the team have been informed, so if you need access to the building feel free to coordinate through Jamie.
Thanks for your understanding and cooperation.
Best,
Rodi

(Id. at 129.) Orahood then replied:

Rodi
Received. Are you shutting down the whole business or just the Summitville location?
What are you going to do with the equipment at Summitville? We may be interested in some of it like the forklifts, shop tools etc. if you plan to sell them.
Regarding Jamie-if she's looking for a job, we might be able to employ her in our business and actually utilize that building for another segment we have, not sure but possibly. Please send her my contact info when convenient and I will see what I can do. She seemed pretty sharp.
Thanks for the heads up. Sorry to hear that things took a bad turn and wish you all better fortunes in the future.
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(Id. at 128.)

[¶4] Sometime in October or November 2019, Union City listed the Property online as available for lease. On November 25, 2019, Rozin emailed Orahood:

Josh,
We are wrapping up production in Summitville. The equipment auction is on December 4th. We will spend the remaining time cleaning up.
Since December is our last month, would it be possible to apply our deposit against the rent payment? As I've shared with you before, the business is not doing well, and I am trying to keep the lights on in my other location.
Your help with this would be greatly appreciated.
Thanks,
Rodi

(Id. at 70.) Orahood replied later that day:

Rodi-I've got a business to run as well and lots of mouths to feed, and if I recall correctly, you wanted to have us sign a 2 year lease agreement so you could get your business loan. I shifted my business plans around and made significant investments in alternate real estate to accommodate you, in consideration of the lease agreement.
Our expectation is to be paid to the completion of the term laid out in the lease agreement.
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Thanks

(Id. at 69-70.) Rozin wrote back:

Josh,
With all due respect, I gave you 6 months notice and my understanding was that you were ok with early termination. This is the first time I am hearing of your expectation to get paid through June. . . . I am really shocked considering we had a discussion and you never brought this up.
Thanks,
Rodi

(Id. at 69.) DERR hired an outside contractor and additional employees to help it vacate the Property by the end of December, and it sold most of its equipment at the December auction.

[¶5] On February 21, 2020, Union City filed a complaint alleging DERR breached the lease agreement by discontinuing its rent payments in December 2019 and by damaging the Property and leaving business personal property behind. On March 4, 2021, Union City filed a motion for summary judgment. Union City argued the lease agreement was a valid contract, which DERR breached by vacating the property before expiration of the lease term. Union City asserted it never agreed to shorten the lease term, but to the extent DERR contends there was such an agreement, "there was no consideration to support a modification of the Contract." (Id. at 47.) DERR filed a memorandum in opposition to

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Union City's motion for summary judgment in which DERR argued the contract was orally modified by agreement to allow early termination. In support of its memorandum, DERR submitted an affidavit from Rozin, in which he averred:

5. In June 2019, on behalf of [DERR], I notified Josh Orahood, the Plaintiff's owner ("Landlord"), that due to ongoing business difficulties, [DERR] would be unlikely to successfully complete the lease term and requested an early lease termination effective December 31, 2019.
6. The Landlord agreed to the early termination at that time in June 2019. Shortly after he agreed to the early lease termination and on numerous occasions, the Landlord stated that he planned to use the premises for his own business.
10. All of [DERR's] property had been removed from the premises by the end of December 2019. The only remaining items in the premises were racking Landlord asked to be left behind, an antique safe and antique table owned by Landlord, and some heaters that Landlord asked to be left at the premises. Any other remaining items were fixtures that are physically connected to the premises,
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