Kass Realty Company v. Stanley Company of America

• Decision Date: 19 August 1955
• Docket Number: No. 12554.,12554.
• Citation: Kass Realty Company v. Stanley Company of America, 226 F.2d 54, 96 U.S.App.D.C. 332 (D.C. Cir. 1955)
• Parties: KASS REALTY COMPANY, Inc., Appellant, v. STANLEY COMPANY OF AMERICA, Appellee.
• Court: U.S. Court of Appeals — District of Columbia Circuit

226 F.2d 54 (1955)

KASS REALTY COMPANY, Inc., Appellant, v. STANLEY COMPANY OF AMERICA, Appellee.

No. 12554.

United States Court of Appeals District of Columbia Circuit.

May 19, 1955.

Decided August 19, 1955.

Mr. O. R. McGuire, Jr., Washington, D. C., for appellant.

Mr. Philip W. Amram, Washington, D. C., for appellee.

Before PRETTYMAN, WILBUR K. MILLER and FAHY, Circuit Judges.

WILBUR K. MILLER, Circuit Judge.

Kass Realty Company sued Stanley Company of America for damages in the sum of $250,000 because of an alleged breach by Stanley of a contract between them executed December 12, 1944. By the terms of the agreement Kass was to erect a theatre on a MacArthur Boulevard site and upon its completion Stanley was to lease it for a term of twenty years. Kass alleged it had acquired the site prior to the execution of the contract in reliance on Stanley's agreement to lease the theatre. It alleged also that it commenced construction in March, 1945, but stopped work when in October, 1945, Stanley notified it to do so and stated it would not honor the lease agreement. This action by Stanley is the alleged breach of contract as a result of which Kass declared it had suffered the damages sought.

Among other defenses Stanley pleaded that January 3, 1946, it had entered into a tripartite contract with Kass and a partnership composed of Kogod and Burka (K-B), by the terms of which the contract of December 12, 1944, had been cancelled and the claim being sued on had been settled. The District Court granted summary judgment to Stanley, saying, "Any cause of action released." Kass appeals.

It is of course necessary to determine the effect of the alleged settlement agreement and to examine the events which led to its execution. In 1945 K-B bought a site on MacArthur Boulevard about three blocks from the Kass-Stanley location and announced they would build a theatre. The area could not profitably support two theatres. K-B sued Kass, Stanley and several others to enjoin construction of the Stanley theatre on the ground it was part of a plan to perpetuate a Warner monopoly, Stanley then being a subsidiary of Warner Brothers Pictures, Inc. That suit resulted in a settlement evidenced by three contracts, two of which were between Stanley and K-B and provided for abandoning the Stanley theatre project and forming the MacArthur Corporation, with stock control divided between Stanley and K-B, to own and operate a theatre on the K-B site.

The settlement depended on the third contract, dated January 3, 1946, which is the instrument pleaded by Stanley as a settlement of the claim involved in the present action. Kass therein agreed to cancel the lease of December 12, 1944, in consideration of the sum of $45,000 and to sell the unwanted Stanley site to the MacArthur Corporation for $15,000. Stanley and K-B agree to designate within two years a site for another theatre to be built by Kass elsewhere in the District of Columbia and to be leased to Stanley or, at Kass' option, to Stanley and K-B. Stanley and K-B agreed to pay Kass $100,000 as damages if they failed to...