                                                                                                                           Opinions of the United
2007 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


11-6-2007

Hampden Real Estate v. Metro Mgmt Grp
Precedential or Non-Precedential: Non-Precedential

Docket No. 06-4052




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                                                        NOT PRECEDENTIAL

               UNITED STATES COURT OF APPEALS
                    FOR THE THIRD CIRCUIT


                              No. 06-4052


  HAMPDEN REAL ESTATE, INC., General Partner; JAGDISH BANSAL;
ASHOK LUHADIA; INDU GARG; ANIL GUPTA, Limited Partners, trading as
     Hampden Enterprises, L.P., A New Jersey Limited Partnership,
                                                       Appellants

                                    v.

           METROPOLITAN MANAGEMENT GROUP, INC.;
            SKYLINE APARTMENTS, LLC, A PA. Limited
             Liability Company; KEVIN TIMOCHENKO


             On Appeal from the United States District Court
                 for the Eastern District of Pennsylvania
                       (D.C. Civil No. 02-cv-01160)
             District Judge: Honorable Michael M. Baylson


               Submitted Under Third Circuit LAR 34.1(a)
                           October 26, 2007

    Before: SLOVITER, CHAGARES, and HARDIMAN, Circuit Judges

                       (Filed: November 6, 2007)



                               OPINION
SLOVITER, Circuit Judge.

       A jury decided that Metropolitan Management Group, Inc. (“Metropolitan”) (the

buyer) was entitled to the fund of approximately $120,000 held in escrow pursuant to its

purchase of a residential property. The seller, Hampden Real Estate. Inc. (“Hampden”),

appeals from the District Court’s order denying its motion for summary judgment and/or

motion in limine, and its motion for post-trial relief. The District Court had jurisdiction

pursuant to 28 U.S.C. § 1332, and we have jurisdiction pursuant to 28 U.S.C. § 1291. We

will affirm.

       Because we write primarily for the parties, who are familiar with the proceedings,

we do not restate the facts in detail. The amended Agreement of Sale (the “Sale

Agreement”) by which Hampden sold the residential property to Metropolitan provided

that the property would cost $3.7 million, that Metropolitan would assume Hampden’s

mortgage on the property, and that Hampden would receive a credit of $120,549.78. The

credit was held in escrow pursuant to Hampden’s mortgage.

       The parties executed the Sale Agreement on September 24, 2001, and closed on

November 28, 2001. During the intervening time period, the parties negotiated the

purchase price to reflect costs required to repair the property. During these negotiations,

the parties viewed a draft and a final version of a HUD-1 Settlement Statement prepared

by the closing agent. The final Settlement Statement did not show the escrow amount

among the itemized debits and credits.

       After closing, Hampden made a demand for payment of the escrow amount, which

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Metropolitan refused. Hampden then filed suit, claiming breach of contract, unjust

enrichment, and conversion. Metropolitan counterclaimed for breach of contract, unjust

enrichment, and fraudulent or negligent misrepresentation. The District Court granted

Hampden’s partial motion for summary judgment as to the breach of contract claim and

dismissed its remaining claims as moot. It denied Metropolitan’s cross-motion for

summary judgment on all counts.

       On Metropolitan’s appeal of the District Court’s order with respect to the breach of

contract claim, we held that the parol evidence rule did not preclude testimony that the

parties had intended for the Settlement Statement to modify the Sale Agreement. Because

we concluded that the parties’ intention to modify the Sale Agreement was a material

issue of fact, we reversed the District Court’s grant of summary judgment, and remanded

for further proceedings. Hampden Real Estate, Inc. v. Metro. Mgmt. Group, Inc., 142 F.

App’x 600 (3d Cir. 2005).

       On remand, the District Court reopened discovery and permitted the deposition

testimony of Metropolitan’s CEO, Kevin Timochenko. The District Court denied the

parties’ renewed cross-motions for summary judgment and Hampden’s motion in limine.

The matter proceeded to trial. The jury determined that the parties had modified the

original Sale Agreement, and returned a verdict for Metropolitan. The District Court then

denied Hampden’s motion for post-trial relief. Hampden appeals.

       Hampden first argues that the District Court erred by failing to grant its motion for

summary judgment. Our review of the District Court’s denial of summary judgment is

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plenary, and we apply the same standard of review as the District Court. Given the

Settlement Statement and the deposition testimony of Timochenko that prior to closing

the parties were negotiating the “number [he] was willing to pay for the property,” there

were several genuine issues of material fact in dispute. App. at 6. These included:

whether the parties intended to delete the escrow provision from the final contract;

whether the parties intended to orally modify the Sale Agreement; and whether the

Settlement Statement was intended to modify the Sale Agreement. Accordingly,

Hampden was not entitled to summary judgment.

       Hampden also contends that it was entitled to a new trial or judgment

notwithstanding the verdict because the evidence failed to establish that the parties

intended to modify the Sale Agreement. We review the District Court’s denial of the

motion for a new trial under the abuse of discretion standard. A new trial should be

granted “only when the record shows that the jury’s verdict resulted in a miscarriage of

justice or where the verdict, on the record, cries out to be overturned or shocks our

conscience.” Williamson v. Consol. Rail Corp., 926 F.2d 1344, 1353 (3d Cir. 1991). The

verdict does not meet this standard.

       Contrary to Hampden’s contention, there was sufficient evidence to support the

conclusion that the parties intended to exclude the escrow amount. During trial,

Timochenko testified that after executing the Sale Agreement Metropolitan discovered

numerous defects in the property. Further, Timochenko gave detailed testimony about the

price negotiations that followed this discovery. Hampden counters that the escrow

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amount was never mentioned during these negotiations. From this, it concludes that no

reasonable jury could have found that the parties intended the final sale price to exclude

that amount. In light of the defects to the property, the heated negotiations that preceded

closing, and the fact that the final Settlement Statement did not include the escrow

amount, we cannot conclude that there is insufficient evidence to support the jury’s

verdict.

       Similarly, the District Court did not err in denying Hampden’s motion for

judgment notwithstanding the verdict. For the same reasons discussed above, there was

sufficient evidence to support the jury’s determination that the final sale price did not

include the escrow amount.

       Hampden further contends that the District Court erred in denying its motion in

limine and allowing Timochenko’s testimony. We review the District Court’s ruling to

admit evidence for abuse of discretion. Renda v. King, 347 F.3d 550, 553 (3d Cir. 2003).

Under this deferential standard, we will not disturb the District Court’s exercise of

discretion unless there is a clear error or “no reasonable person would adopt the district

court’s view.” Oddi v. Ford Motor Co., 234 F.3d 136, 146 (3d Cir. 2000) (citation

omitted).

       Unless otherwise barred, relevant evidence is admissible, and relevant evidence is

any evidence that tends to make a consequential fact more or less probable. See Fed. R.

Evid. 401, 402 & 403. There can be little doubt that Timochenko’s testimony was highly

relevant to the central issue in this case: whether the parties intended to modify their

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original agreement. In our earlier holding in this case, we held that the parol evidence

rule does not preclude evidence of subsequent oral modifications. Specifically, we stated

that “the parol evidence rule does not preclude testimony regarding the parties[’] intention

to alter the final purchase price by executing a Settlement Statement, after the execution

of the Sale Agreement, which omitted the Escrow Account Credit.” Hampden Real

Estate, 142 F. App’x at 602-03. Timochenko’s testimony was evidence of post-execution

negotiations, and thus the parol evidence rule does not provide a basis for its exclusion.

       Finally, Hampden contends that the District Court erred by submitting confusing

interrogatories to the jury. Rule 51 of the Federal Rules of Civil Procedure provides that

no party may assign error to jury instructions unless it objected thereto. Failure to object

to an instruction at the time the jury receives it constitutes a waiver of this objection.

Inter Med. Supplies, Ltd. v. Ebi Med. Sys., Inc., 181 F.3d 446, 463 (3d Cir. 1999).

       Because Hampden failed to object during trial, we review for plain error. Watson

v. SEPTA, 207 F.3d 207, 222 (3d Cir. 2000). The District Court presented the

interrogatories in a clear and logical fashion. Moreover, given the fact that there was

sufficient evidence to support the jury’s conclusion that the parties did modify the Sale

Agreement, we are unable to find any plain error.

       For the reasons set forth, we will affirm the judgment of the District Court.




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