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One Carol Place Co., L.L.C. v. Melnor

UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY


November 17, 1998

ONE CAROL PLACE CO., L.L.C.,
PLAINTIFF,
V.
MELNOR, INC., HUNT-WESSON, INC., AND HUNTER FAN CO.,
DEFENDANTS,
AND
MELNOR, INC.,
DEFENDANT/THIRD
PARTY PLAINTIFF,
V.
CAPACITY, INC., AND R. SISKIND & CO.,
THIRD PARTY DEFENDANTS.

The opinion of the court was delivered by: Joel A. Pisano United States Magistrate Judge

MEMORANDUM OPINION

Before the Court is defendants' motion for a protective order. Plaintiff filed opposition and the Court did not hear oral argument, choosing instead to decide the motion on the papers pursuant to Federal Rule of Civil Procedure 78. For the reasons set forth below, defendants' motion is denied in part and granted in part.

It is not necessary for the Court to set out at length the detailed facts of the case thus far. For a thorough discussion of the procedural and factual history of the case, see Judge Wolin's opinion of April 23, 1998. Some brief background information is necessary, however, for an understanding of the motion currently under consideration.

This case concerns the claim of plaintiff One Carol Place Company, L.L.C., that defendants are responsible for (1) repairing and (2) removing alterations and improvements to the industrial facility that they leased from plaintiff. Judge Wolin's April 23, 1998, opinion grew out of various parties' motions for summary judgment. At issue, inter alia, before Judge Wolin was whether defendants were in default on their lease as of November 6, 1992, the date on which plaintiff and defendant signed a Consent Lease to a new tenant. Before agreeing to the new lease, defendants wanted to ensure that they would not be held liable for damage caused by the new tenant. The Consent Lease set forth who was responsible for what damage and repairs as of November 6, 1992. Litigation ensued because plaintiff claimed defendants failed to meet their original lease obligations, while defendants asserted that, because plaintiff signed the Consent Lease, it waived any right to claim that defendants breached their original lease.

In this regard, the Court sided with defendants and determined that defendants were not in default at the time the parties signed the Consent Lease on November 6, 1992. Rather, defendants needed only to perform certain minor repairs described in a document known as the Engineer's Report. Significantly, the Court concluded that § 7(d) of the Lease provides that the tenant was not in default at the time the parties signed the Consent Lease. [The Consent Lease] clearly limited [defendants'] obligation to the repairs contained in the Engineer's Report.

One Carol Place, L.L.C., v. Melnor, Inc., No. 96-2122, slip op. at 33-34 (D.N.J. April 23, 1998). By signing the Consent Lease, the Court held that plaintiff had released defendants from their obligations under the original lease because plaintiff was, in effect, confirming that defendants were not in default on the original lease.

Continuing, the Court concluded that plaintiff could not hold defendants liable for repairs to the building and grounds that were needed, but about which plaintiff did not know on November 6, 1992. Specifically, the Court held:

[P]laintiff has no one to blame but itself for not learning about alleged defects because it knew that it was requiring [defendants] to repair only those items listed in the Engineer's Report. Thus plaintiff waived the right to have its tenant perform other repairs that may have been needed on November 6, 1992, when it signed the Consent Lease. One Carol Place, L.L.C., v. Melnor, Inc., No. 96-2122, slip op. at 34 (D.N.J. April 23, 1998) (emphasis in original).

Thus, the Court determined that, not only were defendants not in default on their lease, they would not be held liable in the future for defects that existed on November 6, 1992, but about which plaintiff had no knowledge.

On September 4, 1998, defendants filed a motion seeking a protective order that would preclude plaintiff from conducting further discovery concerning the repair or replacement of the roofs. In addition, defendants seek to prohibit plaintiff from deposing five witnesses who defendant alleges have information concerning the meaning of the Consent Lease. Plaintiffs oppose the motion for a protective order.

In plaintiff's papers opposing defendants' motion for a protective order, plaintiff attempts an end run around Judge Wolin's opinion by asserting that the damage to the roof was caused by defendants' post- 1992 failures to maintain it in good repair. As proof, plaintiff offers the expert opinion of Jan Kalas, a licensed architect from an engineering and architectural consulting firm. In his September 15, 1998, declaration in lieu of affidavit, Kalas declares that he first examined the roof in fall 1997 and that the roof defects in need of repair were caused by "inadequate maintenance of the roofs subsequent to the date of the Engineer's Report . . . ." Later in his September report, Kalas declares that another section of the roof "rapidly deteriorated between the date of the [Engineer's] Report and [his] examination in the fall of 1997." Therefore, plaintiff relies on the expert's September report in an effort to avoid the strictures of Judge Wolin's opinion, which held that plaintiff could not make claims for roof damage because these were waived when it signed the Consent Lease in November 1992.

As defendants properly point out in their reply papers, Judge Wolin had Kalas's February 18, 1998, expert roofing report before him when he signed his April 23, 1998, opinion and order. Kalas's February report claimed that subsurface defects existing prior to November 6, 1992, caused the need for roof replacement in 1997. Now plaintiff attempts to revise Kalas's opinion by asserting that the real cause of the roof defects was post-1992 "inadequate maintenance." Plaintiff cannot have it both ways. In connection with the summary judgment motions this spring, plaintiff's expert asserted an opinion as to the roof that now, as a result of Judge Wolin's opinion, forecloses plaintiff's theory of recovery. Plaintiff cannot now shift gears and assert that the damage to the roof was not caused by the factors listed in Kalas's February 1998 expert roofing report.

Apparently realizing that it would appear disingenuous to assert one position and then, only seven months later, assert a different one, plaintiff incorporates by reference Kalas's February 1998 expert opinion into the September 1998 declaration. The two declarations, however, assert different opinions. Plaintiff relied on the first declaration in connection with the spring 1998 summary judgment motions; plaintiff is therefore estopped from now changing its mind and offering a new exert opinion at a time in the litigation when the prior declaration works to its disadvantage. In sum, the Court agrees with defendant and concludes that Judge Wolin's April 23, 1998, opinion bars further discovery as to all issues relating to the repair or replacement of roofs.

One issue remains. Defendants seek to preclude plaintiff from deposing Anthony Barone, Mary Fortino, C.H. Yahn, Ed Whitcraft, and Ben Adams. Plaintiff asserts that each witness knows discoverable information about the meaning of the Consent Lease, namely whether the parties intended that the Consent Lease would release defendants from liability and, if so, what issues were released.

Judge Wolin addressed this issue in the summary judgment opinion dated April 23, 1998. In this regard, Judge Wolin concluded: The question, therefore, is whether § 7(d), which states that [defendant] is not in default of the Lease, absolved [defendant] from its obligations under the lease. [Defendant] answers the question affirmatively. Plaintiff counters that § 6(c), which provides that the Consent Lease does not release [defendant] or any prior tenant from its obligations under the Lease, requires the Court to answer the question negatively. The Court concludes that a genuine issue of material fact exists as to whether § 7(d) materially altered the Lease such that [defendant], as the original lessee, is released from its obligations. Thus, a jury should decide the issue. One Carol Place, L.L.C., v. Melnor, Inc., No. 96-2122, slip op. at 39-40 (D.N.J. April 23, 1998) (emphasis added).

Plaintiffs argue that in order to decide the issue jurors will need to hear witnesses' testimony and construe the intent of the parties who entered the Consent Lease. The Court agrees and notes that defendants appear to concede that plaintiff is entitled to depose the parties who entered into the Consent Lease, as defendants state that they do not object to deposition discovery as long as it is limited to the jury issue defined by Judge Wolin's opinion dated April 23, 1998. Therefore, consistent with Judge Wolin's opinion, defendants' motion to preclude deposition discovery is denied. Plaintiff is admonished, however, to avoid in deposition questioning subjects that do not further the analysis of whether § 7(d) of the Consent Lease materially altered the lease such that defendant Hunt-Wesson was released from its obligation.

An appropriate order follows.

Orig: Clerk

cc: Hon. Alfred M. Wolin

All parties

Order

Before the Court is defendants' motion for a protective order. Plaintiff filed opposition and the Court decided the motion on the papers pursuant to Federal Rule of Civil Procedure 78. For the reasons set forth in the attached memorandum opinion,

IT IS on this 16th day of November 1998

ORDERED that defendants' motion for a protective order is granted as to discovery concerning repair or replacement of roofs, and it is further

ORDERED that defendants' motion for a protective order is denied as to deposition discovery regarding the meaning of § 7(d) of the Consent Lease.

JOEL A. PISANO UNITED STATES MAGISTRATE JUDGE

Orig: Clerk cc: Hon. Alfred M. Wolin

19981117

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