Tri-State Auto v. Gleba, Inc ( 2021 )

J-A08031-21
2021 PA Super 109TRI-STATE AUTO AUCTION, INC. : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
GLEBA, INC. AND SHIPLEY ENERGY :
:
: No. 1846 EDA 2020
APPEAL OF: GLEBA, INC. :
Appeal from the Judgment Entered September 1, 2020
In the Court of Common Pleas of Montgomery County Civil Division at
No(s): No. 2016-06133
BEFORE: PANELLA, P.J., MURRAY, J., and STEVENS, P.J.E.*
OPINION BY STEVENS, P.J.E.: FILED MAY 26, 2021
Gleba, Inc. (“Gleba”) appeals from the judgment entered on September
1, 2020, in the Court of Common Pleas of Montgomery County following a
non-jury trial in a declaratory judgment action filed by Tri-State Auto Auction,
Inc. (“Tri-State”).1 This matter involves a dispute over a non-residential lease,
including a provision related to a right of first refusal to purchase property,
entered between Tri-State, as lessor, and Gleba, as lessee. After a careful
review, we affirm.
____________________________________________
* Former Justice specially assigned to the Superior Court.
1 We note Tri-State named Shipley Energy (“Shipley”), who sublet a portion
of the leased premises at issue from Gleba, in the declaratory judgment
complaint and sought a declaration as to whether Shipley was required to
vacate the premises. However, Shipley vacated the premises on June 4, 2016,
and there is no dispute that Shipley is no longer involved in this matter.
J-A08031-21
The trial court has aptly set forth the relevant facts and procedural
history, in part, as follows:
Both Tri-State and Gleba are Pennsylvania corporations with
their registered offices in Montgomery County. (Joint Stipulation
of Facts--Declaratory Judgment Action Only (“Joint Stipulation”),
filed 7/24/17, at 1). Tri-State is the title owner of an
approximately 5.4 acre parcel of improved land located at 538
Swedeland Road (“538 Swedeland”), Upper Merion Township,
Montgomery County (“the Premises”). (Id.; N.T., 8/14/17, at
18). COBOCO, LP (“COBOCO”) is a limited partnership formed
with Tri-State as the general partner and the two individual
principals of Tri-State as the limited partners. (Id. at 19).
COBOCO owns a contiguous, approximately five (5) acre parcel of
improved land located at 504 Swedeland Road (“504 Swedeland”),
Upper Merion Township, Montgomery County. (Id.; Joint
Stipulation at 4). The COBOCO property at 504 Swedeland has
no street frontage and access is limited to a small driveway that
is an easement across the Premises at 538 Swedeland. (N.T.,
8/14/17, at 21).
Tri-State owned and operated an automobile auction
company and used the entire ten (10) acres of the two (2) parcels
to operate the business. ([Id.] at 19-20). Once Tri-State
stopped [its] automobile auction business in 2008, [its] goal was
to eventually sell the parcels. (Id. at 25).
In December 2010, Tri-State, as lessor, leased the Premises
at 538 Swedeland to Gleba, as lessee, pursuant to a lease with a
Rider and a subsequent addendum (“the Lease”). (Joint
Stipulation at 1-2, Exhibit A). David W. Bowe, President, and
Jerome J. Combs, Secretary, signed the Lease on behalf of Tri-
State[,] and Walter C. Gleba, President and Secretary, signed on
behalf of Gleba. (Id.) Counsel for Gleba, including John D. Maida,
Esquire (“Attorney Maida”), drafted the Lease without speaking to
[c]ounsel for Tri-State. (N.T., 8/14/17, at 24-25, 58-60).
[Specifically, there was no direct communication between Mitchell
Russell, Esquire on behalf of Tri-State, and Attorney Maida,
counsel for Gleba.] Although Attorney Russell provided comments
regarding a draft of the [L]ease to his client, Tri-State, he did not
participate in the negotiation of the Lease. ([Id.] at 24-25).
The Lease is a fully integrated instrument setting forth all of
the provisions thereof. (Joint Stipulation at 3). Paragraph (k) of
the Rider provides as follows:
-2-
J-A08031-21
The Lessee shall have the right to extend the term of
this Lease, for two additional terms of two (2)
additional years each by notifying the Lessor of the
Lessee’s election to exercise such right at least three
(3) months prior to the expiration of the then current
term of this Lease provided that at the time of the
exercise of such right and at the time of such renewal,
the Lessee shall not be in default in the performance
of any of the terms, covenants, or conditions herein
contained, and that this Lease shall not have been
terminated prior to the commencement of such
extended term. Lessee’s minimum annual rent during
the option terms shall be increased to $1,800.00 per
month during the first option lease term and to
$1,900.00 per month during the second option lease
term. Notwithstanding the foregoing and with respect
to the entire term of this lease (initial and renewal),
Lessor shall have the right to terminate this lease at
any time during any term upon ninety (90) days prior
written notice of termination to Lessee and payment
to Lessee of a termination fee of $100,000.00.
(Joint Stipulation Exhibit A, Rider to Lease, at 2).
Paragraph (p) of the Rider provides:
Lessor hereby grants Lessee a right of first refusal to
purchase the leased premises for the purchase price
to be determined as herein set forth; such right of first
refusal shall exist upon the occurrence of either of the
following events only:
1. Any attempted transfer of Premises, whether
voluntary or involuntary, by operation of law or
otherwise, including but not limited to, all executions
or legal processes attaching Premises and all
processes affecting the interest of Lessor therein; or
2. The receipt by Lessor of a bona fide offer from
a third party legally entitled to purchase Premises,
which offer Lessor desires to accept.
Immediately upon the occurrence of any of the events
herein before set forth, the Lessor shall send written
notice by certified mail to the Lessee of such fact. If
Lessor desires to sell Premises as a result of a bona
fide offer, such written notice shall contain the name,
-3-
J-A08031-21
address and qualifications of the person who made the
offer and all of the terms of such offer. During the
period that shall begin with the occurrence of such
event and shall end thirty (30) days after such written
notice is given, the Lessee shall have the right to
exercise its option to purchase the Premises upon any
terms and conditions that are more beneficial to the
Lessor than those set forth in the offer to purchase so
presented. If Lessee does not exercise its option to
purchase Premises or waives such right in writing, this
option shall terminate and be of no further force and
effect. If any event occurs pursuant to which Lessee
may exercise its option to purchase Premises and it
fails to so exercise its option to purchase Premises,
within the allocated time, said option to purchase
Premises shall terminate; provided, however, in the
event a proposed transfer or sale is not consummated
in accordance with the price and on the terms set forth
in the notice sent to Lessee as required hereby, the
Lessor shall not be entitled to sell Premises unless re-
offered to Lessee under the terms of this Agreement
at any different price and/or on any different terms.
Moreover, if the Premises is not sold pursuant to the
notice within six (6) months after the notice is given,
the Premises may not be sold unless re-offered
pursuant to this Agreement.
Any notice required to be given hereunder or
any exercise of an option granted herein must be
made in writing, sent by either registered or certified
mail, return receipt requested and addressed as
required by the Lease.
(Joint Stipulation Exhibit A, Rider to Lease, at 3-4).
Even prior to Gleba expressing an interest in leasing 538
Swedeland, and at all times material hereto, there had been a “For
Sale” sign located on the Premises and the COBOCO parcel
(together “the Sale Properties”)[,] as they were jointly offered for
sale. (Joint Stipulation at 4; N.T., 4/19/18, at 22-25). At one
time, the Sale Properties were jointly offered for sale for the sum
of $3,750,000.00. (Joint Stipulation at 4; N.T., 4/19/18, at 65,
77). Tri-State never offered the Premises for sale as a parcel
separate and apart from the Sale Properties. (Joint Stipulation at
4; N.T., 8/14/17, at 29; N.T., 4/19/18, at 41-43).
-4-
J-A08031-21
In 2014, Tri-State received a letter of intent from an affiliate
of O’Neill Properties, 508 Swedeland Road Associates, LP,
regarding their interest in the purchase of the Sale Properties.
(Joint Stipulation at 4; N.T., 8/14/17, at 27; Joint Exhibit 2). At
Attorney Russell’s direction, Jerome Combs, representing Tri-
State, met with Walter Gleba in that time period to discuss what
Tri-State believed to be the basic terms of an offer acceptable to
Tri-State on the Sale Properties to ascertain whether Gleba had
an interest under the right of first refusal to purchase the
property. (Joint Stipulation at 4; N.T., 8/14/17, at 30). Attorney
Russell subsequently received a call from Attorney Maida
informing him that Attorney Maida believed it was premature to
discuss a right of first refusal because there was no agreement of
sale in place. (N.T., 8/14/17, at 30).
The 508 Swedeland Road Associates letter of intent was
reduced to a purchase agreement dated April 24, 2014. (Joint
Stipulation at 4). Attorney Russell sent a letter dated May 2,
2014, to Mr. Gleba outlining the terms of an agreement of sale for
the purchase of the Sale Properties. (N.T., 4/19/18, at 99; May
2, 2014, Letter, Exhibit D-4). In that May 2, 2014, letter to Mr.
Gleba, Attorney Russell misidentified the property subject to the
agreement of sale as solely 538 Swedeland Road when, in fact,
Attorney Russell intended to reference the entire approximately
ten (10) acres to include the 504 Swedeland Road property. (N.T.,
4/19/18, at 99-100).
Attorney Russell forwarded the full terms of the agreement
to Attorney Maida on May 2, 2014, stating that Gleba would have
thirty (30) days to exercise or waive the right of first refusal.
(N.T., 8/14/17, at 30-31). In a letter dated May 15, 2014,
Attorney Maida stated, in part, “[b]ased on what has been sent to
me to date (your letter and the AOS), my client cannot and has
no obligation in my opinion to make any decision or exercise any
option since the contradictions in your letter notice and the AOS
are so material as to render both notices a nullity.” (Exhibit P-2,
Letter to Tri-State from John D. Maida dated May 15, 2014, at 2).
Attorney Maida also stated “[b]ecause your letter and the AOS so
greatly differ, I must advise my client that, in my opinion, the
differences of your letter as compared to the AOS demonstrate a
bad faith effort to frustrate my client’s right of first refusal and an
attempt to force it to purchase a contiguous property in which it
has no interest.” (Id. at 3).
Following an exchange of correspondence, Tri-State
understood Gleba’s position to be that a property constructed offer
-5-
J-A08031-21
that would give rise to Gleba’s obligation to exercise or waive the
right of first refusal would need to be limited to the leased
Premises alone[,] and that if Tri-State attempted to sell the leased
Premises in any manner outside of that understanding, Gleba
would take legal action. (N.T., 8/14/17, at 35-36).
The April 24, 2014, purchase agreement terminated
pursuant to its “due diligence” provisions. (Id. at 37; Joint
Stipulation at 4). Once the agreement of sale with the O’Neill
group expired, the issue raised by Attorney Maida in
correspondence of a purchase price for both properties but a right
of first refusal for only one (1) of the properties became moot.
(N.T., 4/19/18, at 105). Tri-State ceased marketing of the Sale
Properties at that time. (N.T., 8/14/17, at 37, 44; N.T., 4/19/18,
at 66).
On advice of counsel, the Tri-State and COBOCO principals
determined that it was best to wait until the [L]ease naturally
expired in April of 2016 to pursue a sale of the Sale Properties.
(N.T., 8/14/17, at 38). Although counsel for Tri-State received
two (2) nonbinding letters of intent, dated October 2, 2015, and
November 27, 2015, respectively, from a broker2 on behalf of
___________________________________________________
2 The broker, Paul French, did not have a listing agreement on the Sale
Properties at the time. (N.T., 8/14/17, at 45; N.T., 4/19/18, at 74-75).
Mr. French subsequently entered into a commission agreement for the
Sale Properties after February 2, 2017. (N.T., 4/19/18, at 75, 94, 96-
97).
Thomas J. Puhl and Kristen F. Puhl [(collectively “the Puhls”)],
[c]ounsel determined that they never amounted to an offer and
instructed the broker to inform the Puhls, as well as many other
interested parties, that the Sale Properties were off the market.
(N.T., 8/14/17, at 45-48; N.T., 4/19/18, at 66-67, 69-71, 73, 75,
81-83, 95). Attorney Russell did not communicate the existence
of these letters or the potential interest in the Sale Properties to
the principals of Tri-State at this time. (N.T., 8/14/17, at 100-
01).
In early 2016, Gleba exercised its option to renew the Lease.
(Id. at 39). As a result of Gleba’s action, Tri-State made the
economic decision to pay Gleba $100,000.00 to terminate the
Lease early in order to market the Sale Properties as a combined
parcel. (Id.).
On March 9, 2016, [c]ounsel for Tri-State, Michael J.
Clement, Esquire (“Attorney Clement”), dispatched a letter dated
March 8, 2016, by certified mail, return receipt requested, on
-6-
J-A08031-21
behalf of Tri-State (“the Letter”) to Walter C. Gleba as President
of Gleba, Inc. (Joint Stipulation at 2). Counsel enclosed a check
payable to Gleba in the amount of $100,000.00 with the March 8,
2016, [L]etter. (Id., Exhibit B). The Letter and $100,000.00
check to Gleba constituted Tri-State’s notice of termination of the
Lease effective June 7, 2016, pursuant to [paragraph] (k) of the
Rider. Tri-State also sought “written adequate assurance” within
ten (10) days that Gleba would vacate the leased Premises within
ninety (90) days. (Id.).
The term “written adequate assurance” is not a defined term
in the Lease. (Joint Stipulation at 3). Attorney Russell explained
that the reasons in support of the decision to request adequate
assurance from Gleba were two-fold. The first reason being the
very large $100,000.00 payment made up front in light of a
$1,800.00[-]a[-]month lease…before Gleba was required to
vacate the premises. The second reason being the history of
communication with Attorney Maida regarding the right of first
refusal. (N.T., 8/14/17, at 42-43).
Gleba admittedly received the [March 8, 2016,] Letter on
March 13, 2016. (Joint Stipulation at 2). Attorney Clement’s
office also mailed a copy of the Letter to Gleba’s [c]ounsel,
Attorney Maida, on March 8, 2016. (Complaint, filed 3/30/16, at
¶ 11; Answer, filed 4/22/16, at ¶ 11; Exhibit B). Counsel for Tri-
State sent two (2) emails to [c]ounsel for Gleba seeking a
response, on March 21, 2016, and March 22, 2016, respectively.
(Complaint at ¶ 12, Exhibit C; Answer, filed 4/22/16, at ¶ 12).
Because Gleba failed to respond with an assurance, Tri-State filed
a Complaint in Declaratory Judgment on March 30, 2016.
(Complaint at ¶ 15). In the Complaint, Tri-State requested a
declaration that the [L]ease terminated effective June 7, 2016.
(Id. at ¶ 17). Tri-State sought a determination regarding the
parties’ respective rights and obligations by requesting a clear
judicial indication as to when Gleba must vacate the Premises as
required by the Lease. (Id. at ¶¶ 18, 19).
Gleba filed an Answer with New Matter on April 22, 2016,
and Tri-State filed an Answer to the New Matter on May 5, 2016.
In the New Matter, Gleba avers “no controversy exists as to the
provisions of an integrated Lease,” that Tri-State’s “Letter
Notice…is a nullity and of no import to the instant action in that it
does not conform to the provisions of the Lease,” that Tri-State
“violated Gleba’s right of first refusal set forth in the Lease,” and
“[b]y the terms of the Lease, Gleba’s right of first refusal is binding
upon Plaintiff until the actual termination of the Lease.” (Answer
-7-
J-A08031-21
with New Matter at ¶¶ 3, 14, 17, 18). In response to Gleba’s New
Matter, Tri-State asserted, inter alia, that its “Letter Notice
conforms to the provisions of the Lease which require a tender of
One Hundred Thousand Dollars ($100,000.00) by Landlord for the
early termination of the Lease,” “Lessor has not received a bona
fide offer from a third party legally entitled to purchase the
Premises, which offer Lessor desires to accept,” and “Gleba’s right
of first refusal is a written right, specifically limited to two events
only, neither of which has occurred nor will occur prior to the
termination of the Lease on June 7, 2016.” (Answer to Defendant
Gleba, Inc.’s New Matter, filed 5/5/16, at ¶¶ 14, 17, 18).
On May 13, 2016, Tri-State’s [c]ounsel sent a Letter to
Gleba’s [c]ounsel providing a modification of the notice and
granting Gleba until June 13, 2016, to vacate the Premises. (Joint
Stipulation at 3, Exhibit C). The May 13, 2016, Letter also
informed Gleba that Tri-State would declare Gleba in breach of the
Lease and seek monetary and exemplary damages[,] including
recovery of the $100,000.00 it had paid to Gleba[,] should Gleba
not vacate on or before June 13, 2016. (Id.; N.T., 8/14/17, at
63-65).
Gleba paid, and Tri-State accepted, all base rent due up to
and including April 30, 2016. (Joint Stipulation at 3). On June 9,
2016, Gleba deposited the $100,000.00 check, which Attorney
Clement had enclosed with the March 8, 2016, termination Letter.
(N.T., 8/14/17, at 62-63, 65). On June 13, 2016, Attorney Maida,
on behalf of Gleba[,] wrote to Attorney Clement, as counsel for
Tri-State, to state, inter alia, that Gleba rejected the March 8,
2016, [L]etter as being of no force and/or effect; the Lease, as an
integrated instrument, speaks for itself; Attorney Clement’s May
13, 2016, [L]etter was accepted as adequate notice to exercise
the option to terminate the Lease ninety (90) days hence, and
Gleba has accepted payment of $100,000.00 in consideration of
the Lease terminating on August 11, 2016. (Joint Stipulation,
Exhibit D).
Gleba did not vacate the Premises by June 13, 2016, nor did
Gleba vacate the Premises by August 11, 2016, as represented in
Attorney Maida’s June 13, 2016, Letter. (N.T., 8/14/17, at 40).
Tri-State finally obtained possession of the [Premises] through a
writ of possession served on July 12, 2016, with possession taken
on October 13, 2016. However, Gleba did not vacate the Premises
until October 28, 2016. (Joint Stipulation at 2).
-8-
J-A08031-21
In the fall of 2016, well after Gleba had cashed the
$100,000.00 check and vacated the property, Tri-State instructed
a broker to go back to the two parties who had previously
expressed the most serious interest, O’Neill Properties and the
Puhls.3 (N.T., 8/14/17, at 48, 50). The principals of Tri-State and
COBOCO, the broker[,] and [c]ounsel met at the end of January
2017 to discuss the two offers. ([Id.] at 48, 50).
3 Mitchell Russell, Esquire testified at trial that Tri-State and COBOCO
had hoped to go back onto the market with the property on roughly June
13, 2016, but Gleba’s actions prevented that from occurring until several
months later. ([Id.] at 53).
Even though O’Neill had presented a slightly higher
purchase price, the group decided to accept the Puhls’ offer. (Id.
at 51). Tri-State and COBOCO entered into a purchase agreement
for the Sale Properties with the Puhls dated February 2, 2017, for
the purchase price of $3,900,000.00. ([Id.] at 12, 48-49; Joint
Exhibit J-2; P-3). Gleba has never made an offer, large or small,
for any portion of the Sale Properties. (N.T., 8/14/17, at 69).
On June 24, 2016, Tri-State filed a Complaint for Confession
of Judgment along with a Praecipe for Writ of Possession Upon a
Confessed Judgment seeking possession of the leased property
from Gleba. (Complaint and Praecipe for Writ of Possession, filed
6/24/16, at Docket No. 2016-13334). Tri-State filed a Complaint
for Confession of Judgment under Pa.R.C.P. 2952 on December 9,
2016, seeking unpaid rents due under the Lease together with
costs, interest, and an attorney’s commission. (Complaint for
Confession of Judgment, filed 12/9/16, at Docket No. 2016-
29319). On May 2, 2017, by agreement of [c]ounsel, the Court
consolidated the three matters under docket number 2016-
06133.4 (Order dated May 2, 2017, docketed May 4, 2017).
4 Gleba subsequently filed a lawsuit against Tri-State, David Bowe,
Jerome Combs, and Thomas Puhl on August 3, 2017, under docket
number 2017-19677. [The trial] court granted summary judgment in
favor of Tri-State, Bowe, Combs, and Puhl, and dismissed Gleba’s
complaint on May 10, 2019. Gleba filed two notices of appeal. The
Superior Court initially quashed the appeal at 1912 EDA 2019 but
reinstated that appeal at 3200 EDA 2019. The other appeal was
docketed at 2108 EDA 2019. [Relevantly, the Superior Court affirmed
the orders granting summary judgment in favor of Tri-State, Bowe,
Combs, and Puhl, and dismissing Gleba’s complaint, in its entirety. See
Gleba, Inc. v. Tri-State Auto Auction, Inc., 2108 and 3200 EDA 2019
(Pa.Super. filed 2/19/21) (unpublished memorandum). Specifically, the
Superior Court agreed with the trial court that Gleba’s lawsuit was
-9-
J-A08031-21
barred by the doctrine of res judicata as it raised the same claims as
those raised in the instant declaratory judgment matter. See id.]
[A two-day bench trial was held regarding the Declaratory
Judgment Action on August 14, 2017, and April 19, 2018]. Prior
to [the trial court] taking the bench on the first day, the [p]arties
presented the [trial] court with a document on Attorney Maida’s
caption entitled “Joint Stipulation of Facts—Declaratory Judgment
Action Only,” [which was] admitted as Exhibit J-1 Stipulation.
[The trial court] found Attorney Russell’s testimony on direct
and cross[-]examination highly credible. After Tri-State rested its
case, [c]ounsel moved for a partial directed verdict on the
termination of the [L]ease being proper, including the termination
of the right of first refusal. (N.T., 8/14/17, at 108). Counsel for
Gleba did not object procedurally to the oral motion and instead
moved to dismiss the case or direct the addition of the potential
buyer, Thomas Puhl[,] as an indispensable party. (Id. at 109).
The court reiterated what had been discussed in conference earlier
in the day, that after the testimony was transcribed, the court
would issue an order for [c]ounsel to file their submissions.
Counsel filed briefs on their respective motions, and the
[trial] court entered its [d]ecision on January 24, 2018. Gleba
filed post-trial motions on February 2, 2018, arguing that it had
not had the opportunity to present its witnesses. Although the
[trial] court disagreed with Gleba’s position as presented, [the trial
court] entered an order on March 2, 2018, opening the record in
the interest of justice to proceed with Gleba’s witnesses. [Also,
on March 2, 2018, the trial court entered an order denying Gleba’s
motion in limine alleging the failure to join an indispensable party
and oral motion to dismiss.]
On April 19, 2018, the [trial court] presided over a second
day of trial. Attorney Maida started his argument in support of a
motion for nonsuit by stating that at the first day of trial[, as well
as pleadings filed since then and the stipulated facts,] the case
went beyond what he had filed in his pretrial statement[.]
Referring to the document entitled “Joint Stipulation of Facts—
Declaratory Judgment Action Only,” [c]ounsel then went on to
state “[b]ut the stipulated facts were predicated on the
consolidation of all the cases.” (N.T., 4/19/18, at 4). He
continued “it was stipulated as to all the cases, these are the facts
which—because it was a consolidated matter.” (Id.)
In response, Attorney Clement argued “we’re here today
because there is a dispute between the parties related to a [L]ease
- 10 -
J-A08031-21
and a right of first refusal contained within the [L]ease. And, as
Mr. Maida indicated, this is a fully integrated document. My client
believes the [L]ease was properly terminated. They came to this
[c]ourt to have the [c]ourt confirm for them that the [L]ease was
properly terminated.” ([Id.] at 11).
The [trial] court denied Gleba’s motion for compulsory
nonsuit. (Id. at 12). Gleba then presented witnesses[:] Jerome
Combs and David Bowe of Tri-State, broker Paul French[,] and
Attorney Russell. While the [trial] court found all of these
witnesses credible, the [trial] court specifically found Mr. French’s
testimony highly credible.
Trial Court Opinion, filed 10/29/20, at 1-15 (footnote omitted).
After considering all of the evidence presented at the bench trial, the
court issued an Amended Decision on August 14, 2018, which contained the
following relevant declarations as to Tri-State’s complaint for declaratory
relief:
18. In this action, [Tri-State] seeks a declaration that 1) Tri-State
properly terminated the Lease; 2) Gleba’s right of first refusal set
forth in the Lease terminated contemporaneously with the Lease;
3) a repudiation of the Lease by Gleba occurred[;] and 4) an
anticipatory breach of the Lease by Gleba occurred.
19. Th[e] [trial] court opines that the Lease is unambiguous.
20. Both [p]arties concede that the Lease contains an integration
clause that is binding.
21. A fair reading of the complaint in combination with the
evidence admitted at trial results in the court[’s] determining that
[Tri- State] properly terminated the Lease pursuant to paragraph
(k) of the Lease [R]ider[,] as of Monday, June 13, 2016, by mailing
the written March 8, 2016, Letter with the enclosed check in the
amount of $100,000.00 by certified mail on March 9, 2016, and
as admittedly received by [Gleba] on March 13, 2016.
22. The right of first refusal was contained within paragraph (p)
of the Lease [R]ider also terminated as part of the Lease on or
before June 13, 2016.
- 11 -
J-A08031-21
23. The [trial] court concludes that Gleba’s actions and failure to
provide what [Tri-State] terms “adequate assurance[,”] while no
doubt frustrating, did not constitute an “absolute and unequivocal
refusal to perform[.”]
24. Therefore, the [trial] court finds for Gleba and against [Tri-
State] on the claims of repudiation and anticipatory breach.
25. The [trial] court also concludes that Gleba did not vacate the
Premises pursuant to the terms of the Lease, which failure
constituted a breach of that Lease. The [trial] court will issue a
separate order scheduling argument and a hearing, if necessary,
to hear Gleba’s petition to open the judgment and to assess
damages including, inter alia, Gleba’s failure to pay rent and
taxes, together with costs, interest[,] and an attorney’s
commission, in a subsequent proceeding under docket [No.]
2016-29319, now consolidated [at No. 2016-06133].[11]
11 Paragraph 25 of the Amended Decision was [later] amended by order
dated September 1, 2020, to omit the first sentence regarding the trial
court’s determination that Gleba’s failure to vacate the Premises
constituted a breach of the Lease.
26. [Tri-State’s] [c]omplaint in [c]onfession of [j]udgment for
possession filed under docket [No.] 2016-13334, now
consolidated [at No. 2016-06133], is moot.
Gleba, Inc. v. Tri-State Auto Auction, Inc., 2108 and 3200 EDA 2019, at
*11-12 (Pa.Super. filed 2/19/21) (unpublished memorandum) (citing
Amended Decision, filed 8/14/18, at 16-17).
On August 21, 2018, Gleba filed a timely post-trial motion,2 and Tri-
State filed a response on September 10, 2018. On September 20, 2018,
before the trial court ruled on the post-trial motion, Gleba filed an appeal to
____________________________________________
2 In Motorists Mutual Ins. Co. v. Pinkerton, 574 Pa. 333, 830 A.2d 958(2003), our Supreme Court ruled that a party must file a post-trial motion if
there is a trial in a declaratory judgment action, and the Court noted that an
appeal lies after the motion for post-trial relief is denied.
- 12 -
J-A08031-21
this Court.3 By order entered on June 29, 2020, this Court quashed Gleba’s
appeal on the basis it was interlocutory. Gleba, Inc. v. Tri-State Auto
Auction, Inc., 2679 EDA 2018 (Pa.Super. filed 6/29/20) (per curiam order).
On August 25, 2020, the trial court heard oral argument on Gleba’s
motion for post-trial relief, and on September 1, 2020, the trial court granted
in part, and denied, in part Gleba’s post-trial motion. Specifically, as indicated
supra, the trial court granted the motion to amend paragraph 25 of the
Amended Decision. The trial court denied Gleba’s post-trial motion in all other
respects and entered judgment. This timely appeal by Gleba followed. 4
____________________________________________
3 The trial court directed Gleba to file a Pa.R.A.P. 1925(b) statement, and
Gleba timely complied.
4 After Gleba filed the instant appeal from the entry of judgment, the trial
court did not direct Gleba to file a Pa.R.A.P. 1925(b) statement, and
consequently, Gleba did not file a Rule 1925(b) statement. The trial court,
however, filed a Rule 1925(a) opinion on October 29, 2020, utilizing the issues
presented in Gleba’s Rule 1925(b) statement, which Gleba filed with regard to
the previous interlocutory appeal docketed in this Court at 2679 EDA 2018.
The trial court now urges this Court to find Gleba’s present appellate issues
waived on the basis Gleba presented a vague, voluminous Rule 1925(b)
statement. We agree with the trial court’s characterization of Gleba’s Rule
1925(b) statement. See Jiricko v. Geico Ins. Co., 947 A.2d 206 (Pa.Super.
2008) (noting the appellant filed an incoherent, rambling, voluminous
statement in violation of Pa.R.A.P. 1925(b)). However, the Rule 1925(b)
statement to which the trial court refers was filed by Gleba specifically in
connection with its previous interlocutory appeal docketed in this Court at
2679 EDA 2018. Thus, inasmuch as the deficient Rule 1925(b) statement at
issue was filed in a prior appeal, we decline to find waiver with regard to the
issues raised in the instant appeal.
- 13 -
J-A08031-21
On appeal, Gleba sets forth the following issues in its “Statement of the
Questions Involved” (verbatim):
1. Should Amended Decisions declaration 18, 21, and 22, as
appealed, be vacated because they determine rights in
anticipation of events that had not occurred or were moot?
2. Did the lower court by the Amended Decision’s declarations 18,
21, and 22 improperly determine uncertainties or controversies
not before the Court, as never having been pled? 42 P.S. §
7538?
3. By awarding supplemental relief in the Amended Decision’s
declarations 18, 21, and 22, did the lower court commit
reversible error because the issues therein posed may only
have been adjudicated and sufficiently heard with Thomas Puhl
as an additional party? If so, absent Appellee joining Thomas
Puhl as an additional party, did the lower court and now this
Court lack subject matter jurisdiction as mandated by Rule the
Act? 42 P.S. § 7540[?]
4. Did the lower court’s granting of “supplemental relief” in
declarations 18, 21, and 22 of the Amended Decision,
constitute reversible error because Appellant, Gleba, Inc. was
not afforded notice, as required by 42 P.S. § 7540, to show
cause why such supplemental declarations should not be
granted?
5. Was supplemental relief granted in declarations 18, 21, and 22
of the Amended Decision, including but not limited to
terminating Gleba’s right of first refusal, reversible error, in
light of Judge Rogers’ determining that Thomas Puhl’s
Agreement of Sale to purchase the Premises, was insufficient
to prove he was an indispensable party, per 42 P.S. § 7540?
Gleba’s Brief at xii-xiii (footnotes, bold, and suggested answers omitted).5
Before examining the merits of Gleba’s issues, we admonish Gleba for
its lack of compliance with our Rules of Appellate Procedure. Although Gleba
____________________________________________
5 We note Gleba misnumbered its questions as 1, 2, 3, 6, and 7. We have
corrected the numbering as 1, 2, 3, 4, and 5.
- 14 -
J-A08031-21
sets forth five issues for our review in its “Statement of the Questions
Involved,” the argument portion of its brief contains only one section, in
violation of Rule 2119(a). See Pa.R.A.P. 2119(a) (“The argument shall be
divided into as many parts as there are questions to be argued; and shall have
at the head of each part—in distinctive type or in type distinctively displayed—
the particular point treated therein….”).
Moreover, we note that significant portions of Gleba’s single argument
section contain rambling assertions of fact in the light most favorable to Gleba
without any citation to authority or development of an appropriate argument.
See Gleba’s Brief at 24-29. Further, mid-way in the argument section, Gleba
indicates its appellate issues presently before this Court are as follows
(verbatim):
1. Whether, other than as stated in the Verdict, did Tri State’s
Complaint on the date of trial set forth any other causes of
action or controversy upon which relief could have also been
granted;
2. Whether Tri State’s Complaint set forth causes of action upon
which relief should be denied in Equity due to its unclean
hands;
3. Whether Tri State’s acts were fraudulent and a breach of the
Lease and denied Appellant’s rights and entitlements
thereunder; and
4. Whether Tri State’s defective Notice of Termination was inter
alia a breach of Lease by Tri State invalidating the lower court’s
“fair reading” of the Lease termination date.
Gleba’s Brief at 28-29.
- 15 -
J-A08031-21
The remainder of Gleba’s single argument section is a combination of
argument aimed at its issues as initially set forth in the “Statement of the
Questions Involved” and its issues as set forth mid-way in the argument
portion of the brief. See id. at 29-47.
In light of Gleba’s clear violations of the Rules of Appellate Procedure,
we could quash this appeal, as Tri-State urges this Court to do. See Tri-
State’s Brief at 28-30; In re W.H., 25 A.3d 330, 339 n.3 (Pa.Super. 2011)
(“[W]here an appellate brief fails to provide any discussion of a claim with
citation to relevant authority or fails to develop the issue in any other
meaningful fashion capable of review that claim is waived.”); Pa.R.A.P. 2101
(“[I]f the defects are in the brief or reproduced record of the appellant and
are substantial, the appeal or other matter may be quashed or dismissed.”).
However, to the extent Gleba has presented a properly developed
argument in support of the claims set forth in its “Statement of Questions
Involved,” which challenged the trial court’s August 14, 2018, Amended
Decision relating to declarations 18, 21, and 22, we shall review the claims
collectively.
Preliminarily, we set forth the following relevant legal precepts:
[The Declaratory Judgment Act relevantly provides that]
any person interested under a…contract, or other writings
constituting a contract…may have determined any question of
construction or validity arising under the instrument…and obtain
a declaration of rights, status, or other legal relations thereunder.
- 16 -
J-A08031-21
42 Pa.C.S.A. § 7533. In order to establish a right to relief through a
declaratory judgment, a plaintiff must establish a direct, substantial and
present interest. Bromwell v. Michigan Mut. Ins. Co., 716 A.2d 667, 670
(Pa.Super. 1998). Further, a plaintiff must demonstrate that an actual
controversy exists. Id. “The prime purpose of the Declaratory Judgment Act
is to speedily determine issues that would…be delayed, to the possible injury
of those interested if they were compelled to wait the ordinary course of
judicial proceedings.” Osram Sylvania Products, Inc. v. Comsup
Commodities, Inc., 845 A.2d 846, 849 (Pa.Super. 2004) (quotation marks
and quotation omitted).
Further,
[w]hen reviewing the results of a non-jury trial, we give great
deference to the factual findings of the trial court. We must
determine whether the trial court’s verdict is supported by
competent evidence in the record and is free from legal error. For
discretionary questions, we review for an abuse of that discretion.
For pure questions of law, our review is de novo.
Recreation Land Corp. v. Hartzfeld, 947 A.2d 771, 774 (Pa.Super. 2008)
(internal citations omitted). See Stokes v. Gary Barbera Enterprises,
Inc., 783 A.2d 296, 297 (Pa.Super. 2001) (“When the trial court sits as fact
finder, the weight to be assigned the testimony of the witnesses is within its
exclusive province, as are credibility determinations, and the court is free to
choose to believe all, part, or none of the evidence presented.”).
- 17 -
J-A08031-21
Additionally, we recognize the interpretation of a lease is a question of
law and this Court’s scope of review is plenary. See Szymanowski v. Brace,
987 A.2d 717 (Pa.Super. 2009).
[A] lease is in the nature of a contract and is controlled by
principles of contract law. It must be construed in accordance
with the terms of the agreement as manifestly expressed, and the
accepted and plain meaning of the language used, rather than the
silent intentions of the contracting parties, determines the
construction to be given the agreement. Further, a party seeking
to terminate a lease bears the burden of proof.
T.W. Phillips Gas & Oil Co. v. Jedlicka, 615 Pa. 199, 42 A.3d 261, 267
(2012) (quotation marks, quotations, and citations omitted).
The intent of the parties to a written agreement is to be
regarded as being embodied in the writing itself. The whole
instrument must be taken together in arriving at contractual
intent. Courts do not assume that a [lease’s] language was
chosen carelessly, nor do they assume that the parties were
ignorant of the meaning of the language they employed. When a
writing is clear and unequivocal, its meaning must be determined
by its contents alone.
Murphy v. Duquesne University Of The Holy Ghost, 565 Pa. 571, 777
A.2d 418, 429 (2001) (internal citations and quotation marks omitted).
Furthermore, where a written lease contains an integration clause, the
lease, “if unambiguous, must be held to express all of the negotiations,
conversations, and agreements made prior to its execution, and neither oral
testimony nor prior written agreements, or other writings, are admissible to
explain or vary the terms of the [lease].” 1726 Cherry Street Partnership
v. Bell Atlantic Properties, Inc., 653 A.2d 663, 665 (Pa.Super. 1995)
(citation omitted).
- 18 -
J-A08031-21
In the case sub judice, in addressing Gleba’s challenges to the trial
court’s August 14, 2018, Amended Decision relating to declarations 18, 21,
and 22, the trial court relevantly indicated as follows:
[Gleba challenges the trial court’s determination that the
Lease terminated on June 13, 2016.] The record is abundantly
clear that Attorney Russell opined the [L]ease terminated ninety
(90) days after Mr. Gleba received the March 8, 2016[,] [L]etter
and check on March 13, 2016. Later in his testimony, Attorney
Russell specifically testified that the [L]ease terminated on June
13, 2016, or approximately 90 days after March 13, 2016….Simply
because [Gleba disagrees with the trial court’s determination] is
not an indication of bias. To the contrary, it demonstrates that
the court weighed all of the evidence…in a careful, thoughtful, and
unbiased manner.
***
Gleba…[seeks] to modify paragraph 18 and strike
paragraphs 21 [and] 22…of the Amended Decision. Specifically,
Gleba desires a determination as to whether Tri-State properly
terminated the Lease but not whether the right of first refusal
terminated as part of the Lease. Gleba has conceded that the
[L]ease, along with the right of first refusal, has terminated. The
[p]arties disagree on the date of termination.
***
Instantly, on the one hand, [c]ounsel for Gleba asserts that
the [trial] court erred in determining that the [L]ease terminated
on a date other than August 13, 2016, and on the other hand[,]
[c]ounsel claims error because the court did not rule on whether
it terminated as of June 7, 2016. Gleba concedes the [L]ease has
terminated. Tri-State’s position is that the [L]ease terminated
ninety (90) days after [c]ounsel mailed the termination [L]etter
and tendered the $100,000.00 check received by Gleba on March
13, 2016.
In drafting its decision, resolution of the dispute required
the [trial] court to interpret, inter alia, the following language in
the [L]ease: “Lessor shall have the right to terminate this lease
at any time during any term upon ninety (90) days prior written
notice of termination to Lessee and payment to Lessee of a
termination fee of $100,000.00.” The word “payment” alone is
not defined in the [L]ease. After reviewing the evidence and the
- 19 -
J-A08031-21
law, the [trial] court interpreted the words “payment to,” together
in context with the remainder of the provision, to mean that Tri-
State had properly terminated the [L]ease as of June 13, 2016,
when it mailed the termination [L]etter dated March 8, 2016,
enclosing a check for $100,000.00 to Gleba, both of which Gleba
admittedly received on March 13, 2016. When Gleba actually
deposited the check enclosed with the termination [L]etter is of
no moment.
[Furthermore], [a]t the second day of trial, Attorney Maida
submitted “it was affirmed that this case for declaratory relief was
relying solely on the pleadings in that case. Does not involve the
other two actions, whereas the stipulation involves them all.”
(N.T., 4/19/18, at 7). While the “Joint Stipulation of Facts—
Declaratory Judgment Action Only” speaks for itself, the [trial]
court agreed with Attorney Maida’s argument that the bench trial
pertained solely to the declaratory judgment pleadings. Those
pleadings included Tri-State’s complaint, Gleba’s answer with new
matter[,] and Tri-State’s answer to Gleba’s new matter. As
previously noted, in Gleba’s new matter, Gleba averred “the
Plaintiff violated Gleba’s right of first refusal set forth in the Lease”
and “[b]y the terms of the Lease, Gleba’s right of first refusal is
binding upon Plaintiff until the actual termination of the Lease.”
(Gleba’s Answer with New Matter at ¶¶ 17, 18).
The right of first refusal obtained by Gleba is a clause within
the [L]ease. When the [L]ease terminated, so too did the right of
first refusal. The [trial] court made a determination, as requested
by the [p]arties in their pleadings, as to whether Tri-State
properly terminated the [L]ease, which included a right of first
refusal therein. The [trial] court made those determinations as
part of its August 14, 2018[,] Amended Decision. Counsel has
presented no evidence, viable argument[,] or applicable law in
support of a claim that the right of first refusal somehow survived
the proper termination of the [L]ease.[6]
____________________________________________
6 We specifically note that, to the extent Gleba contends the “controversy”
over the termination of the right of first refusal was an issue in anticipation of
events that had not yet occurred (Issue 1 supra), was not an issue before the
trial court (Issue 2 supra), or was decided without Gleba having adequate
notice (Issue 4 supra), we find no merit. As the trial court indicated, Attorney
Maida acknowledged the bench trial pertained to the Declaratory Judgment
(Footnote Continued Next Page)
- 20 -
J-A08031-21
Finally, Gleba complained in its post-trial motion that the
[trial] court erroneously ruled that Gleba had breached the
[L]ease based upon events which occurred after Tri-State filed its
complaint. Because the [trial court] concluded that Gleba’s
position [in this regard] was correct, and now finally having had
the opportunity to address the issue, the [trial] court modified
Paragraph 25 to remove that particular ruling.
Trial Court Opinion, filed 10/29/20, at 33-34, 37-39 (footnotes and bold
omitted)
We agree with the trial court’s sound reasoning in this regard. We find
no abuse of discretion or error of law. See Recreation Land Corp., supra.Finally, it bears mentioning that Gleba sets forth two issues (Issue 3 and
5) in its “Statement of the Questions Involved” pertaining to the trial court’s
failure to join Thomas Puhl as an indispensable party to the declaratory
judgment action. We dispose of this claim simply by noting that, aside from
making bald assertions of error, Gleba did not develop an argument,
supported with proper citation, regarding the issue of whether Puhl was an
indispensable party. See Gleba’s Brief at 19 n. 56 (baldly asserting Puhl was
an “undoubtedly theretofore an indispensable party”); 40 (baldly asserting
“Puhl by both Rules of Court and the Declaratory Judgment Act, was an
____________________________________________
Action and all pleadings filed therein, including Gleba’s new matter which
averred Tri-State had violated Gleba’s right to first refusal set forth in the
Lease. Thus, a specific determination regarding whether the right of first
refusal contained within the fully integrated Lease terminated upon
termination of the Lease, was an issue properly before the trial court, and
Gleba had adequate notice of the issue.
- 21 -
J-A08031-21
indispensable party; and, then, in turn, the lower court lacked subject matter
jurisdiction and therefore the entire Amended Decision must be vacated.”).
We note the “bulk” of Gleba’s “argument” that Puhl was an indispensable
party appears on page 217 of Gleba’s brief as follows (verbatim):
[E]ven though the lower court declared Puhl a dispensable
party, Declarations 18, 21, and 22 of the Amended Decision were
solely beneficial to Tri-State in its dealings with Puhl. Admittedly,
but for the Erroneous Declarations 18, 21, and 22, Puhl may have
been dispensable; in which case, however, such erroneous
decisions would not have had reason to be entered. When the
Court entered the Erroneous Declarations, Puhl thereby became
indispensable and jurisdiction was lost; thus vacating all
declarations and the case ab initio.
The Erroneous Decisions are now to be deemed by Judge
Rogers’ Amended Decision as the law of the case (res judicata) in
Gleba’s independent suit against Tri-State, Puhl, Combs, and
Bowe. Therefore, as this case is determined so will be the appeals
filed in 2108 EDA 2019 and 3200 EDA 2019. If Puhl became in
indispensable party and jurisdiction was lost in the matter before
the Court; so it will be in all declarations and the entirety of this
case ab initio, as well as in all other proceedings.
Gleba’s Brief at 21 (footnote omitted).
Gleba’s undeveloped claim without citation to authority merits no further
review. See, e.g., Commonwealth v. Johnson, 604 Pa. 176, 985 A.2d 915,
924 (2009) (stating “where an appellate brief fails to provide any discussion
of a claim with citation to relevant authority or fails to develop the issue in
any other meaningful fashion capable of review, that claim is waived”);
____________________________________________
7We note there are two consecutive pages, which are both numbered 21 in
Gleba’s brief.
- 22 -
J-A08031-21
Commonwealth v. McMullen, 745 A.2d 683, 689 (Pa.Super. 2000) (finding
waiver where the argument for the issue “consists of a one paragraph
‘argument’ with virtually no citation to relevant statutory authority or case
law”).
For all of the foregoing reasons, we affirm.
Affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 5/26/2021
- 23 -