IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

601 CHRISTIANA INVESTORS, LLC, )
by way of assignment from Wilmington )

Savings Fund Society, FSB, )
)
Plaintiff, )
)

 ) C.A. No. N15J-03882
)
CHARLES H. GIFFORD, III, )
)
)

Defendant.

Submitted: March 22, 2016
Decided: July 12, 2016

Upon Defendant’s Motion for Reconsideration of Cornmissioner’s Order Pursuant
to Superior Court Civil Rule 132(a)(3)(ii).

DENIED.

Wi11iam D. Sullivan, Esquire, 901 North Market Street, Suite 1300, Wilmington
DE 19801; Mark S. Haltzman, Esquire and Ma1co1m Gould, Esquire, Silverang,
Donohue, Rosenzweig & Haltzman, LLC, 585 East Lancaster Avenue, Suite 203,
St. David’s PA 19087, attorneys for 601 Christiana Investors, LLC

John A. Sergovic, Jr. Esquire, 142 East Market Street, Georgetown, DE 19947,
Attorney for Defendant Charles H. Gifford, III.

WH§ARTON, J.

.QR=DE_R_

This 12th day of July, 20l6, upon consideration of Defendant Charles H.
Gifford’s ("Gifford") Motion for Reconsideration of Commissioner’s Order
Pursuant to Superior Court Civil Rule l32(a)(3)(ii) ("Motion"), Plaintiff 601
Christiana Investors, LLC’s ("60l Christiana") Response, and the record in this
case, it appears to the Court that:

l. On September 2, 2015, 601 Christiana filed a Rule 58.1 confessed

judgment and the Prothonotary entered a "Tentative Confessed
Judgment" against Gifford in the principal amount of $4,858,238.99.1
On October 5, Gifford objected to the entry of judgment by confession
and requested that a hearing be scheduled.z After motion practice,
limited discovery and pre-hearing briefmg, a hearing was conducted
on February 22, 2016 before a commissioner of this court.3 At that
hearing, the commissioner resolved the two issues contested by the
parties in favor of 601 Christiana, ruling that 601 Christiana did have
standing to bring this action, and that Gifford knowingly, voluntarily

and intelligently waived his rights in connection with the confession

‘ D.I. l.
2 D.I. 5.
3D.I. 45.

4 D.I. 47.
5 D.I. 48.

"’ D.I. 50

of judgment.4 The commissioner entered a form of order submitted
by 601 Christiana on February 25, 2016.

On March 8, 2016, Gifford submitted a Motion for Reconsideration of
Commissioner’s Order Pursuant to Superior Court Civil Rule
l32(a)(3 )(ii).§ The single argument presented in the Motion is that the
commissioner exceeded his authority by entering a case-dispositive
order instead of submitting proposed findings of fact and
recommendations for disposition to a judge. 601 Christiana opposes
the Motion on the ground that the commissioner’s order was not case-
dispositive since judgment was entered previously on September 2,
2015.6

Superior Court Civil Rule 132 sets out the authority of a
commissioner to conduct both case-dispositive and non case-
dispositive hearings.7 In case dispositive matters, the commissioner
makes proposed findings of fact and recommendations to a judges In
non case-dispositive matters, the commissioner files an order.9

The rule also sets out the procedure by which an aggrieved party may

7 Super. .Ct. Civ. R. 132(a)(3) and (4).
8 Super. Ct. Civ. R. l32(a)(4)(i).
° Super. Ct. Civ. R. 132(a)(3)(i).

 

seek redress to a judge.lo In both case-dispositive and non case-
dispositive matters, "any party may serve and file written objections

to the Commissioner’s order which set forth with particularity the

ball

basis for the objections. The only difference in the procedures the

rules require a litigant to follow is in captioning the objections. In the
case of a non case-dispositive matters the objections are entitled
"Motion for Reconsideration of Commissioner’s Order,"lz while in

the case of case-dispositive matters, the objections are to be captioned

"Appeal from Commissioner’s Findings of Fact and

Recommendations."n
Whether the matter is case-dispositive or non case-dispositive
determines the standard of review of the commissioner’s order. In
non case-dispositive matters, a judge may reconsider a matter "only
where it has been shown on the record that the Commissioner’s order

is based upon findings of fact that are clearly erroneous, or is contrary

to law, or is an abuse of discretion."m In case-dispositive matters, a

judge reviews de novo those portions of the commissioner’s report or

proposed findings of fact or recommendations to which an objection is

‘° Super. Ct. Civ. R. l32(a)(3)(ii) and (a)(4)(ii)-,;

11

11 Super. cr. Civ. R. 132(@1)(3)(11).
13 Super. ct Civ. R. 132(@)(4)(11).
"‘ Super. Ct. Civ. R. 132(a)(3)(iv).

made.l§

6. Gifford’s obligation to raise objections to the commissioner’s order is
the same whether the matter was case-dispositive or non case-
dispositive. Yet, he asserts only a single objection - that the
commissioner should have treated the matter as case-dispositive and
filed proposed findings of fact and recommendations. Notably, he
does not object to the commissioner’s factual determination that
Gifford waived his rights regarding the confession of judgment freely,
knowingly and voluntarily, nor does he object to the commissioner’s
legal conclusion that 601 Christiana had standing to bring this action.

7. Whether the commissioner determined a case-dispositive matter or
non case-dispositive matter is not a question the Court needs to
resolve. In either circumstance, Gifford is not entitled to relief.

8. If the Court treats the matter as non case-dispositive, the Court applies
the standard of review required by Rule l32(a)(3)(iv). In doing so,
the Court finds that Gifford’s Motion fails for three reasons. First, he
has not raised any objections to the actual decisions made by the
commissioner with respect to waiver and standing. Second, after

reviewing the hearing transcript the Court finds that the

15 Super. Ct. Civ. R. l32(a)(4)(iv),

commissioner’s finding of fact that Gifford knowingly, voluntarily
and intelligently waived his rights in connection with the confession
of judgment is not clearly erroneous. In fact, that factual finding was
compelled by the evidence. As recited by the commissioner:

We have a case of a lawyer, of sophisticated
businessmen who entered into these
documents with advice of counsel. It’s rare
that we have the type of documents that I
see in the confession-of-judgment cases, but
here we have a notarized affidavit from a
lawyer stating that Mr. Gifford consulted
with a lawyer and had these items explained
to him. The evidence is clear, he was
represented by counsel, his businesses were
represented by counsel, and he had ample
opportunity on numerous occasions to
consult with them. And, frankly, l\/lr.
Gifford’s testimony, you know, we’re
talking about something six years ago, all
but concedes that he read the documents and
did consult with a lawyer although he can’t
recall specifically

But in any event, the law is such that it’s for
the Court to look at the totality of the
circumstances to see if the waiver of rights
was knowing, intelligent, and voluntary, and
everything before me in the record indicates
that it was. I have no question whatsoever.
The documents themselves are clear. The
confession-of-judgment language is bold,
it’s highlighted, and it clearly spells out
what would happen upon default. There’s no
ambiguity as to the language. It’s set apart
from the other language in the document so
it’s readily apparent that this is an important

6

16 Tr. 109-110.

17 Id. 108-111.

section and it makes clear to anybody who

reads it what it means. So, there’s no

question in the Court’s mind that the

standard has been met to show that there

was a kn:-?vw:’iz':ig,,,_: intelligent and voluntary of

the confes_sio.r; @fjudgment. 16
Third, the commissioner’s determination that 601 Christiana had
standing to bring this action is not contrary to law. The Court finds
that the commissioner correctly interpreted Section 6.6 of the business
loan agreement to permit the original lender to assign the loan to 601
Christiana.
If the Court treats the matter as case-dispositive, Gifford would have
the Court vacate the commissioner’s order and require the
commissioner to submit to a judge the commissioner’s proposed
findings of fact and recommendations for disposition. The Court sees
no point to engaging in that exercise because the commissioner clearly
set out his findings of fact and recommendations for disposition in his
bench ruling.w No purpose, other than delay, would be served by
remanding the matter back to the commissioner for the purpose of

having him recast his findings of fact and disposition as proposed

findings of fact and recommendations for disposition. Instead, the

Court will apply the de novo standard of review required by Rule
l32(a)(4)(iv) to the commissioner’s order. Treating the Motion as an
appeal from the commissioner’s findings of fact and
recommendations, the commissioner’s order must be affinned, again,
for three reasons. First, Gifford raises no objection to the
commissioner’s findings of fact as to waiver, nor does he object to the
commissioner’s conclusion of law as to standing. Second, the Court
finds from the record that Gifford knowingly, Voluntarily, and
intelligently waived his rights pursuant to the confession of judgment
based on the same evidence and for the same reasons as the
commissioner did. Third, the Court finds that the business loan
agreement permitted the original lender to assign the loan to 601
Christiana, again for the same reasons as the commissioner did.
Therefore, Defendant Charles H. Gifford, III’s Motion for Reconsideration

of Commissioner’s Order Pursuant to Superior Court Civil Rule 132(a)(3)(ii) is

DENIED.

IT IS SO O`.B§B'E`_EH`¥§§`D.

   

l F_ei~ri'  `%-’-=h_ar¥:r¥  J .

