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HomeMy WebLinkAbout01-6201 -. WILLIAMS' ASSOCIATES, PLAINTIFF : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PENNSYLVANIA v. JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC DEFENDANT : CML ACTION - LAW : NO. Ol-"'~l Q,utl <=-r~ PRAECIPE FOR WRIT OF SUMMONS TO THE PROTHONOTARY OF CUMBERLAND COUNTY, PENNSYLYANIA: Please issue a Writ of Summons directed to the above-named Defendant. Respectfully submitted, ~.-(^-- Markian R. Slobodian, Esquire ID No. 41075 801 North Second Street P.O. Box 11967 Harrisburg, PA 17108-1967 717/232-5180 Michael L. Solomon, Esquire ID No. 36031 212 Locust Street, Suite 500 Harrisburg, PA 17101 717/255-7600 Dated: O~. d-.". .;2.00 \ Counsel for Williams Associates WILLIAMS ASSOCIATES, PLAINTIFF : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PENNSYLVANIA v. : CIVIL ACTION. LAW JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC DEFENDANT : NO. 0 I - (,.;;l.b \ C;cJ~l y~ WRIT OF SUMMONS TO: John M. Sullivan & Associates, LLC You are hereby notified that Williams Associates has commenced an a~ainst you. p~b~rla~~ Date: Oct- ;) 9 ( d-OO I "-BY: A~P.~AA'V,-r Deputy John M. Sullivan, M.D. & Associate, LLC Southpoint Office Center 1001 South Market Street, Suite B Mechanicsburg, PA 17055 ,- " (:) -4, l( ~ ,~ ~ 0 0 ~ q -- or; ~ C C> ...'1 lrt ~ -, n "'1;:-::-: '1 , -00-,: .....( ..;.E~ l; tilF' 8 0 2;5' N '::,'~( '- ~ 25 \D "-'._~..,~ "- I f!) ~:;." ~ 'T.''''::..,! ~ r:;c) \~:~:?l , ~0 ~~ -V -to.' ~r 5',0 t; p:: ~ 'C: .- ~ ~ ~ (}1 '-< t f \...1..., SMIGEL. ANDEHS..rnN & SA(~KS. LLP ATTORNEYS AT LAW 2917 NORTH FRONT STREET ~ HARRIS8URG, PENNSYLVANIA 17110-1260 (7171 234-2401 WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCrA TES, LLC, DEFENDANT CIVI L ACTION - LAW PRAECIPE FOR RULE TO FILE COMPLAINT TO THE PROTHONOTARY: Kindly issue a Rule upon PlaintilTto file a Complaint in the above-captioned casc within twenty (20) days alicr service ofthc Rule or suffer ajudgment of non pros. /l1~/ol Date: By: LeRoy Sm el, Esquire ID #09617 2917 North Front Street Harrisburg, P A 17110-1260 (7 I 7) 234-240 I Attorneys for Defcndant RULE TO FILE COMPLAINT AND NOW, _l_AJr>.) Ie> __.2001, a Ruk IS hereby issued upon the Plaintiff to file a Complaint in the above-captioned case within twenty (20) days of service of this Rule or suffer judgment of non pros. I! (', /! -(~ --LJ.J fj d.. //.'<, Prot1lonotar~/ 'Sy: d. (') \~ \ / ' , ~,i....v " _ C . 71/// Deputy rJi'.J.. J' I 1 I I ;;:. CO ~ <:~ -~ ::'~ -, :=, ~-,;: - (J .:J :s; ...-=:;: '.' ,..., :-:-1 ~;: '>- ...0 ;~S en I __2 -, :~;J /- - tU c.; :/j c'- :;t: ..2: ::::> C> 0 SHERIFF'S RETURN - REGULAR CASE NO: 2001-06201 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND WILLIAMS' ASSOCIATES VS SULLIVAN JOHN M MD & ASSOCIATE HAROLD WEARY , Sheriff or Deputy Sheriff of Cumberland County,Pennsylvania, who being duly sworn according to law, says, the within WRIT OF SUMMONS was served upon SULLIVAN JOHN M MD & ASSOCITES LLC the DEFENDANT , at 0930:00 HOURS, on the 31st day of October ,2001 at SOUTHPOINT OFFICE CENTER 1001 SOUTH MARKET STREET STE B MECHANICSBURG, PA 17055 by handing to BARB WEAVER, OFFICE MANAGER a true and attested copy of WRIT OF SUMMONS together with and at the same time directing Her attention to the contents thereof. Sheriff's Costs: Docketing Service Affidavit Surcharge So Answers: 18.00 6.50 .00 10.00 .00 34.50 r~~-<t:~ R. Thomas Kline 11/01/2001 MARKIAN SLOBODIAN Sworn and Subscribed to before By: 7~/d~ Deputy Sheri me this '1 IE-' day of ~. .2~ AD (2 '7hu;,~ ~ ~. rothonotary . --'. t WILLIAMS ASSOCIATES, PLAINTIFF : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PA v. : CIVIL ACTION - LAW JOHN M. SULLIVAN, M.D. & ASSOCIATES,LLC,CAlUlTINAL THERAPIES, P.C. & JOHN M. SULLIVAN, : NO. 01-6201 - Civil Term DEFENDANTS NOTICE You have been sued in court. If vou wish to defend allainst the clairns set forth in the followinll palles. YOU rnust take action within twenty (20) days after this Cornplaint and Notice are served. by enterinll a written appearance personally or bv attorney and minll in writinll with the court your defenses or obiections to the clairns set forth allainst you. You are warned that if YOU fail to do so the case rnay proceed without you and a iudlmlent rnay be entered allainst YOU by the court without further notice for any rnoney clairned in the Complaint or for any other claim or relief reauested by the plaintiff. You rnay lose money or property or other rillhts irnportant to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE. GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. COURT ADMINISTRATOR 4th Floor, Curnberland County Court House Carlisle, PA 17013 717/240-6200 By 1A.. ~ MARKIAN R. SLOBODIAN, ESQ. ID No. 41075 ANDREW R. EISEMANN, ESQ. ID No. 87441 801 North Second Street P.O. Box 11967 Harrisburg, PA 17108-1967 717/232-5180 AI ')..,'1,^oo/ IVOu. I Counsel for Williarns Associates WILLIAMS ASSOCIATES, PLAINTIFF : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PA v. : CIVIL ACTION. LAW JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, : NO. 01.6201. Civil Term DEFENDANTS COMPLAINT NOW COMES, Plaintiff, Williarns Associates, by its counsel, The Law Offices of Markian R. Slobodian and Michael L. Solornon, Esq., and makes the following Cornplaint against Defendants John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.C. and John M. Sullivan: 1. Plaintiff Williams Associates, ("Williarns Associates") is a joint venture, having a principal place of business at 2525 North Seventh Street, Harrisburg, Dauphin County, PA 17110. 2. Defendant John M. Sullivan, M.D. & Associates, LLC (hereinafter "Sullivan, LLC") is a Pennsylvania limited-liability corporation having a principal place of business at 1001 South Market Street, Suite B, Mechanicsburg, Curnberland County, PA 17055. 3. Defendant Cardinal Therapies, P.C. (hereinafter "Cardinal Therapies") is a professional corporation having a principal place of business at 1001 South Market Street, Suite B, Mechanicsburg, Cumberland County, PA 17055. 4. Defendant John M. Sullivan is an individual having a principal place of business at 1001 South Market Street, Suite B, Mechanicsburg, Curnberland County, PA 17055. 5. On or about April 14, 1999, Williarns Associates entered into a Cornrnercial Lease Agreernent ("Commercial Lease") with PHB Managernent Co., Inc., a Pennsylvania corporation ("PHB"), with regard to the lease by PHB of certain prernises owned by Williams Associates known as 3710 Market Street, Harnpden Township, Curnberland County, PA containing a rentable area of 4,307 square feet, rnore or less, in a building consisting of a total of 28,720 square feet (the "Building") known as the Shoppes at Harnpden, together with the non-exclusive use in cornmon with other occupants of the Building, 34 spaces within the parking area and the right to use in comrnon with other occupants of said Building, any access roads serving the Building (hereinafter "Leased Premises"). A true and correct copy of the Cornmercial Lease is attached hereto and incorporated herein as Exhibit "~'. 6. The Comrnercial Lease provided for a lease term cornrnencing April 1, 1999 and terminating on the latter date often (10) years frorn last day of the rnonth in which the Cornrnercial Lease is executed or March 31,2009, unless earlier terminated pursuant to the provisions of the Cornrnercial Lease. 7. Paragraph 21 of the Commercial Lease gave PHB the ability to assign or sublet all or any portion of the Leased Prernises with Williams Associates prior written consent. 2 8. On or about January 16,2001, PHB, with Williarns Associates' written consent, entered into a Medical Office Sub-Lease Agreernent ("Sub-Lease") with Defendant Sullivan, LLC. A true and correct copy of the Sub-Lease is attached hereto and incorporated herein as Exhibit "B". 9. Pursuant to the terrns of the Sub-Lease, Sullivan, LLC agreed to sub- lease frorn PHB the Leased Prernises for an initial terrn of approxirnately thirty- nine (39) calendar rnonths cornrnencing on February 1, 2001 and terminating on March 31, 2004. 10. Paragraph 2 of the Sub-Lease requires Sullivan, LLC to pay rent in the arnount of Five Thousand Two Hundred Four Dollars and 29/100 ($5,204.29) per rnonth during the first year of the Sub-Lease terrn, payable on the first day of each rnonth cornmencing February 1, 2001 and continuing through January 31,2002. 11. Paragraph 2 of the Sub-Lease further requires Sullivan, LLC to pay rent in the arnount of Five Thousand Four Hundred Twelve Dollars and 46/100 ($5,412.46) per month during the second year ofthe Sub-Lease term, payable on the first day of each rnonth comrnencing February 1, 2002 and continuing through January 31,2003. 12. Paragraph 2 of the Sub-Lease requires Sullivan, LLC to pay rent in the arnount of Five Thousand Six Hundred Seventy-Two Dollars and 81/100 ($5,672.81) per rnonth during the third year of the Sub-Lease term payable on the first day of each rnonth cornrnencing February 1, 2003 and continuing through January 31, 2004. 3 13. Paragraph 2 ofthe Sub-Lease requires Sullivan, LLC to pay rent for the final two (2) rnonths of the Sub-Lease terrn in the arnount of Five Thousand Eight Hundred Fifty-Three Dollars and 93/100 ($5,853.93) per rnonth cornrnencing February 1, 2004 and continuing through March 31, 2004. 14. Paragraph 9 of the Sub-Lease indicates that by taking possession of the prernises, Sullivan, LLC agrees that the Leased Premises are and were in tenantable and good condition at the tirne oftaking possession. 15. Paragraph 16 of the Sub-Lease provides in relevant part that in the event of default by PHB to Williarns Associates in payment of rnonthly rent, Williarns Associates, at its election, rnay assurne the Sub-Lease thereby making Sullivan, LLC the tenant ofWilliarns Associates under all terms and conditions of the Sub-Lease. 16. On or about July 14, 2001, PHB filed a voluntary petition under Chapter 11 of the United States Bankruptcy Code with the Bankruptcy Court for the Northem District of Texas, Ft. Worth Division. 17. Pursuant to Section 362 of the Bankruptcy Code, 11 U.S.C. ~362, all actions against PHB were stayed pending an order granting relieffrorn autornatic stay or the Debtor's abandonrnent of the lease. 18. Neither PHB nor Sullivan, LLC have rnade any rent payments to Williams Associates for the rnonth of July, 2001 and thereafter. 19. By letter dated August 9, 2001, Sullivan, LLC, by its counsel, attempted to declare a default by PHB as sub-landlord due to certain alleged water and 4 sewage problerns on the Leased Prernises. A true and correct copy of Sullivan, LLC's counsel's letter of August 9, 2001 is attached hereto and made a part hereof as Exhibit "C". 20. By letter dated October 1, 2001, Sullivan, LLC's counsel advised Williarns Associates' counsel that it was exercising its option under Section 18 of the Sub-Lease to declare the Sub-Lease ended and void. A true and correct copy of the letter of October 1, 2001 is attached hereto and rnade a part hereof as Exhibit "D". 21. On October 4, 2001, the Bankruptcy Court for the Northern District of Texas, Ft. Worth Division, entered an Order authorizing the Debtor to reject certain unexpired leases and executory contracts, including the Cornrnercial Lease at issue in this case. A true and correct copy ofthe Bankruptcy Court's Order of October 4, 2001 is attached hereto and rnade a part hereof as Exhibit "E". 22. By letter dated October 15, 2001, counsel for Williarns Associates advised counsel for Sullivan, LLC that because ofPHB's bankruptcy filing on July 14, 2001, the purported default letter to the Debtor was ineffective due to the imposition ofthe Bankruptcy Autornatic Stay. A true and correct copy ofWilliarns Associates' counsel's letter of October 15, 2001 is attached hereto and rnade a part here of as Exhibit "F". 23. By letter dated October 17, 2001, Williarns Associates, by its counsel, forwarded to Sullivan, LLC's counsel a Notice of Assumption of Sub-Lease, whereby 5 pursuant to Section 16 of the Sub-Lease, Williarns Associates assurned the position of the sub-landlord under the Sub-Lease. 24. In the letter of October 17, 2001, Williarns Associates, through its counsel, further advised Sullivan, LLC of its intent to cornrnence repair ofthe allegedly faulty plurnbing line. A true and correct copy ofWilliarns Associates' Notice of October 17, 2001 is attached hereto and rnade a part hereof as Exhibit "G". 25. By Order dated Novernber 16, 2001, the Bankruptcy Court for the Northern District of Texas, Fort Worth Division, approved the assignrnent of all clairns ofPRB under the Lease or Sub-Lease to Williarns Associates. A true and correct copy of the Bankruptcy Court's Order of Novernber 16, 2001 is attached hereto and rnade a part hereof as Exhibit "R". COUNT I Williams Associates v. John M. Sullivan. LLC Breach of Contract 26. Williams Associates incorporates by referenced Paragraphs 1 through 25 of this Cornplaint. 27. Sullivan, LLC has failed to rnake rental payments due on July 1, 2001 and thereafter. 28. On or about October 29, 2001, Sullivan, LLC abandoned the Leased Prernises and relocated to its current location at 1001 South Market Street, Suite B, Mechanicsburg, PA. 6 29. Sullivan, LLC has defaulted on its obligations under the Sub-Lease pursuant to Paragraph 15 thereof by abandoning the Leased Prernises and by failing to rnake rnonthly rental installrnent payments when due. 30. Sullivan, LLC has defaulted on its obligations under the Sub-Lease by prernaturely and improperly declaring the lease to be terminated and thereby declaring its intention not to comply with any future obligations under the lease. 31. As a result of Sullivan, LLC's default, Williarns Associates has suffered darnages in the arnount of One Hundred Eighty Thousand Six Hundred Twenty- One Dollars and 21/100 ($180,621.21), which darnages consist of rent payments in the arnount of Thirty-Six Thousand Four Hundred Thirty Dollars and 03/100 ($36,430.03) due for July 1, 2001 through January 31,2002, Sixty-Four Thousand Nine Hundred Forty-Nine Dollars and 56/100 ($64,949.56) for rent payments due from February 1, 2002 through January 31,2003, Sixty-Seven Thousand Five Hundred Thirty-Three Dollars and 76/100 ($67,533.76) for rent payments due frorn February 1, 2003 through January 31, 2004, and Eleven Thousand Seven Hundred Seven Dollars and 86/100 ($11,707.86) for rent payments due frorn February 1, 2004 through the end of the lease term on March 31, 2004. WHEREFORE, Plaintiff requests that this Court enter judgrnent in its favor and against Defendant Sullivan, LLC in the arnount of One Hundred Eighty Thousand Six Hundred Twenty-One Dollars and 21/100 ($180,621.21) plus costs of suit, and interest from the date of judgment. 7 COUNT II Williarns Associates v. John M. Sullivan. M.D. & Associates. LLC Uniust Enrichment - (In the Alternative) If this Honorable Court should find that an express contract does not exist between PlaintiffWilliarns Associates and Defendant Sullivan, LLC, which is denied, then, in that event, Plaintiff asserts the following alternative cause of action in quanturn rneruit against Defendant Sullivan, LLC. 32. Williams Associates incorporates herein by reference Paragraph 1 through 31 ofthis Complaint. 33. Having occupied the Leased Prernises frorn July 1, 2001 through on or about October 29, 2001, Defendant Sullivan, LLC becarne liable to Williarns Associates for the just and reasonable fair market value rental charge for the Leased Prernises. 34. Defendant Sullivan, LLC has been unjustly enriched by occupying the Leased Prernises and not paying the fair rnarket rental value of the Leased Prernises. 35. The fair market rental value for the Leased Prernises calculated at Fourteen Dollars and 50/100 ($14.50) per square foot is Five Thousand Two Hundred Four Dollars and 29/100 ($5,204.29) per rnonth, which arnount is the just and reasonable charge of the Leased Premises during the tirne period in which they were occupied by Sullivan, LLC. 36. The total arnount by which Defendant Sullivan LLC has become enriched on account ofrernaining on the Leased Premises for the month of July 8 through October, 2001 is Fifteen Thousand Six Hundred Twelve Dollars and 87/100 ($15,612.87). WHEREFORE, Williarns Associates requests that this Court enter judgment in its favor and against Defendants John M. Sullivan, M.D. & Associates, LLC in the amount of Fifteen Thousand Six Hundred Twelve Dollars and 87/100 ($15,612.87). COUNT III Williarns Associates v. Cardinal Therapies. P.C. Trespass 37. Williarns Associates incorporates herein by reference Paragraph 1 through 36 of this Complaint. 38. During the period commencing February 1, 2001 and continuing through on or about October 29,2001, Defendant Cardinal Therapies occupied certain prernises consisting of approxirnately four hundred (400) square feet in the same building as the Leased Premises but not constituting part of the Leased Premises (the "Unauthorized Prernises"). 39. Cardinal Therapies used the Unauthorized Prernises to conduct certain business. 40. Cardinal Therapies utilized the Unauthorized Prernises without either the knowledge or consent ofWilliarns Associates. 41. Cardinal Therapies provided no compensation to Williams Associates for its unlawful use ofthe Unauthorized Premises. 9 42. During its use ofthe Unauthorized Premises, Defendant Cardinal Therapies rnade certain alterations to the Unauthorized Prernises including certain plurnbing alterations. 43. Cardinal Therapies occupied the Unauthorized Prernises intentionally. 44. Cardinal Therapies' occupation of the Unauthorized Premises has caused Williarns Associates to incur darnages in the arnount of Four Thousand Five Hundred Dollars and 00/100 ($4,500.00) for unpaid rent based on the fair rental value of the premises of Fifteen Dollars and 00/100 ($15.00) per square foot. 45. Cardinal Therapies' occupation of the Unauthorized Premises also caused Williarns Associates to incur darnages in the arnount of approxirnately Two Thousand Five Hundred Dollars and 00/100 ($2,500.00) which arnount represents the estirnated cost of restoring the Unauthorized Premises to their unaltered condition. 46. Cardinal Therapies' actions with regard to the Unauthorized Premises constitute trespass. 47. As a result of Cardinal Therapies' actions, it is liable to Williarns Associates for the above-referenced damages. WHEREFORE, PlaintiffWilliarns Associates requests that this Court enter judgment in its favor and against Defendant Cardinal Therapies in the arnount of Seven Thousand Dollars and 00/100 ($7,000.00) plus costs, plus interest from the date of judgment, plus such further relief that the Court deems necessary and just. 10 COUNT IV Williarns Associates v. John M. Sullivan Tresoass 48. Williarns Associates incorporates herein by reference Paragraph 1 through 47 ofthis Cornplaint. 49. During the period comrnencing February 1, 2001 and continuing through on or about October 29, 2001, Defendant John M. Sullivan occupied certain prernises consisting of approxirnately 400 square feet in the sarne building as the Leased Prernises but not constituting part of the Leased Prernises (the "Unauthorized Prernises"). 50. John M. Sullivan used the Unauthorized Prernises to conduct certain business. 51. John M. Sullivan utilized the Unauthorized Premises without either the knowledge or consent ofWilliarns Associates. 52. John M. Sullivan provided no cornpensation to Williarns Associates for his unlawful use of the Unauthorized Premises. 53. During his use of the Unauthorized Premises, Defendant John M. Sullivan made certain alterations to the Unauthorized Prernises including certain plumbing alterations. 54. John M. Sullivan occupied the Unauthorized Prernises intentionally. 55. John M. Sullivan's occupation of the Unauthorized Premises has caused Williams Associates to incur damages in the amount of Four Thousand Five 11 Hundred Dollars and 00/100 ($4,500.00) for unpaid rent based on the fair rental value of the prernises of Fifteen Dollars and 00/100 ($15.00) per square foot. 56. John M. Sullivan's occupation of the Unauthorized Prernises also caused Williarns Associates to incur darnages in the arnount of approxirnately Two Thousand Five Hundred Dollars and 00/100 ($2,500.00) which arnount represents the estimated cost of restoring the Unauthorized Prernises to its unaltered condition. 57. John M. Sullivan's actions with regard to the Unauthorized Prernises constitute trespass. 58. John M. Sullivan personally benefitted from his intentional trespass and the trespass of Cardinal Therapies upon the Unauthorized Premises. 59. As a result of John M. Sullivan's actions, he is liable to Williarns Associates for the above-referenced darnages. WHEREFORE, PlaintiffWilliarns Associates requests that this Court enter judgrnent in its favor and against Defendant John M. Sullivan in the arnount of Seven Thousand Dollars and 00/100 ($7,000.00) plus costs, plus interest frorn the date ofjudgrnent, plus such further relief that the Court deerns necessary and just. 12 COUNT V Williarns Associates v. Cardinal Therapies. P.C. Uniust Enrichrnent If this Honorable Court should find that Cardinal Therapies, P.C. is not liable to Williarns Associates for trespass darnages in an arnount equal to or exceeding Seven Thousand Dollars and 00/100 ($7,000.00), which is denied, then, in that event, Plaintiff asserts the following alternative cause of action in quantum rneruit against Defendant Cardinal Therapies, P.C. 60. Williams Associates incorporate herein by reference paragraphs 1 through 59 of this Cornplaint. 61. Having occupied the Unauthorized Prernises frorn February 1, 2001 through October 29, 2001, Defendant Cardinal Therapies becarne liable to Williarns Associates for the just and reasonable fair rnarket value rental charge for the Unauthorized Prernises. 62. Defendant Cardinal Therapies has been unjustly enriched by occupying the Unauthorized Prernises and not paying the fair market rental value for the Unauthorized Prernises. 63. The fair rnarket rental value for the Unauthorized Premises calculated at the rate of Fifteen Dollars and 00/100 ($15.00) per square foot is Four Thousand Five Hundred Dollars and 00/100 ($4,500.00). 13 64. Cardinal Therapies has further been unjustly enriched by altering the Unauthorized Prernises and not restoring the Unauthorized Premises to their unaltered condition. 65. By failing to restore the Unauthorized Prernises to their unaltered condition, Cardinal Therapies has been unjustly enriched by the additional arnount of Two Thousand Five Hundred Dollars and 00/100 ($2,500.00). 66. As a result of Cardinal Therapies' actions, it is liable to Williarns Associates for the above-referenced darnages. WHEREFORE, Plaintiff Williams Associates requests that this Court enter judgment in its favor and against Defendant Cardinal Therapies in the arnount of Seven Thousand Dollars and 00/100 ($7,000.00) plus costs, plus interest frorn the date of judgment, plus such further relief that the Court deerns necessary and just. COUNT VI Williarns Associates v. John M. Sullivan Uniust Enrichment If this Honorable Court should find that John M. Sullivan is not liable to Williarns Associates for trespass darnages in an arnount equal to or exceeding Seven Thousand Dollars and 00/100 ($7,000.00), which is denied, then, in that event, Plaintiff asserts the following alternative cause of action in quanturn rneruit against Defendant John M. Sullivan. 14 67. Williarns Associates incorporate herein by reference paragraphs 1 through 66 of this Cornplaint. 68. Having occupied the Unauthorized Premises frorn February 1, 2001 through October 29, 2001, Defendant John M. Sullivan becarne liable to Williarns Associates for the just and reasonable fair rnarket value rental charge for the Unauthorized Prernises. 69. Defendant John M. Sullivan has been unjustly enriched by occupying the Unauthorized Premises and not paying the fair rnarket rental value for the Unauthorized Premises. 70. The fair rnarket rental value for the Unauthorized Prernises calculated at the rate of Fifteen Dollars and 00/100 ($15.00) per square foot is Four Thousand Five Hundred Dollars and 00/100 ($4,500.00). 71. John M. Sullivan has further been unjustly enriched by altering the Unauthorized Prernises and not restoring the Unauthorized Prernises to their unaltered condition. 72. By failing to restore the Unauthorized Premises to their unaltered condition, John M. Sullivan has been unjustly enriched by the additional arnount of Two Thousand Five Hundred Dollars and 00/100 ($2,500.00). 73. As a result of John M. Sullivan's actions, he is liable to Williams Associates for the above-referenced darnages. 15 WHEREFORE, Plaintiff Williams Associates requests that this Court enter judgrnent in its favor and against Defendant John M. Sullivan in the arnount of Seven Thousand Dollars and 00/100 ($7,000.00) plus costs, plus interest frorn the date of judgment, plus such further relief that the Court deerns necessary and just. Respectfully subrnitted, 1tA~ Markian R. Slobodian, Esquire ID No. 41075 Andrew R. Eisernann, Esquire ID No. 87441 801 North Second Street P.O. Box 11967 Harrisburg, PA 17108-1967 717/232-5180 Dated: Ilb.,I~\ Michael L. Solornon, Esquire ID No. 36031 212 Locust Street, Suite 500 Harrisburg, PA 17101 717/255-7600 Counsel for Williams Associates 16 CERTIFICATE OF SERVICE I, Markian R. Slobodian, hereby certify that I have this date, rnailed a true and correct copy of the foregoing Cornplaint by United States rnail, first-class, postage prepaid, addressed to the following individual{s): LeRoy Srnigel, Esquire Srnigel, Anderson & Sacks 2917 North Front Street Harrisburg, PA 17110-1260 1-.A Aj~ MARKIAN R. SLOBODIAN, ESQ. 17 VERIFICATION I, JACK SOLOMON, Plaintiff's General and Managing Partner, hereby verify that the facts contained in the foregoing Complaint are true and correct to the best of my knowledge, information and belief. I understand that false statements herein are subject to the penalties of 18 Pa. C.S.A. S 4904 relating to unsworn falsification to authorities. DATE: November ';)..1,2001 EXHmIT "A" ( , COMMERCIAL LEASE THIS COMMERCIAL LEASE made as of this ~ day of ~~ , 1999, by and between WILLIAMS ASSOCIATES, a joint venture, (herein er called "Lessor") and PHB MANAGEMENT CO., INC., a Pennsylvania corporation (hereinafter called "Lessee"). - WHEREAS, Lessor desires to lease, demise, and let to Lessee, and Lessee desires to lease, take and accept from Lessor, the Leased Premises (as hereinafter defined). NOW, THEREFORE, in consideration of the rent and other charges required to be paid hereunder, and the mutual promises and covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, Lessor and Lessee agree as follows: I. Demised Premises. Lessor, does hereby lease, demise and let to Lessee, and Lessee does hereby lease, take and accept from Lessor, all that certain space ("Leased Premises") known as 3710 Market Street, Hampden Township, Cumberland County, Pennsylvania, containing a rentable area of 4,307 square feet more or less in the building consisting of a total of 28,720 square feet (the "Building") known as the Shoppes at Hampden, together with the nonexclusive use in common with other occupants of the Building, 34 spaces within the parking area and the right to use in common with other occupants of said Building any access road serving the Building. The Premises are let by Lessor to Lessee without representation or warranty by Lessor, and Lessee takes the Premises subject to all restrictive covenants and agreements of record, all zoning regulations, restrictions, rules and ordinances, certificates of occupancy (permanent or temporary), building restrictions and other laws and regulations now in effect or hereafter adopted by any governmental authority having jurisdiction. Lessee acknowledges that Lessee is familiar with and is satisfied as to the quality of title and the physical condition of the Leased Premises at the time of execution of this Lease. Lessee agrees to accept possession of the Leased Premises in the "as is" and "where is" condition of the premises on the date of the execution hereof. Notwithstanding the foregoing Lessor has agreed that during the tirst year of the Lease, Lessor shall replace or repair the roof, as needed, on the Building at its sole expense. Lessee shall be permitted to make certain site improvements, which improvements are subject to the approval of the Lessor. 2. Thnn. The term of the Lease shall commence on the earlier date of the execution of this Lease or April I, 1999 (the "Commencement Date"), and shall terminate on the later date often (10) years from the last day of the month in which this Lease is executed or March 31, 2009 unless earlier terminated pursuant to the provisions of this Lease. 3. Early Termination. So long as Lessee is not in default as of or at any time following Lessee's giving of notice as hereafter provided in this Section 3, Lessee shall be permitted to terminate this Lease at any time after the fifth (5th) full year following the Commencement Date (the "Early Termination Date"). Notwithstanding the foregoing, Lessee may terminate this Lease for cause, as may be permitted under the laws of the Commonwealth of Pennsylvania, at any time during any term of this Lease. If Lessee elects to terminate this Lease on the Early Termination Date, it shall do so by providing written notice to Lessor of its intent no later than one hundred eighty (180) days prior to the Early Termination Date (the date of notice shall be referred to as the "Early Termination Notice Date"), and by making a one-time payment at the time of the giving of notice to Lessor of four (4) months of the then-current Base Rent as set forth in Exhibit "A". If Lessee is permitted to terminate this Lease at any time other than the Early Termination Date, it shall do so by providing written notice to Lessor of its intent no later than sixty (60) days prior to the proposed termination date. 4. Base Rent and Additional Rent. Lessee shall pay as rent during the initial lease term, those sums set forth in Exhibit "A" to this Commercial Lease, the terms of which are incorporated herein as though set forth in their entirety, plus "Additional Rent" as set forth herein, due on or before the first of each month, in advance. Payment of Base Rent only shall commence on the date which is twelve (12) months subsequent to the Commencement Date; the obligation to pay Additional Rent shall commence as of the Commencement Date. If the Commencement Date is any date other than the first day of a month, Base Rent shall be prorated for the month in which Commencement Day falls and shall be due and payable on the due date of the first full month's Base Rent hereunder. If Lessee does not pay the total monthly Base Rent, including Additional Rent, within fifteen (15) days of the due date each month, Lessee will be required to pay a late penalty of 5% of the monthly payment. Lessee shall pay as additional rent any money required to be paid as such pursuant to the provisions of this Lease, as well as all other sums of money or charges required to be paid by Lessee under this Lease, whether or not. the same shall be designated "Additional Rent". 5. Renewal Option. So long as Lessee is not in default as defined in Section 18 as of or at any time following Lessee's giving of notice as hereafter provided, Lessee shall have the right to extend the Term for two (2) terms of three (3) years each (the "Renewal Periods"), the first of such Periods commencing on the expiration of the original Term of this Lease, and the second of such Periods commencing three (3) years thereafter. Notice of Lessee's exercise of option to extend for either of the Renewal Periods shall be in writing and given to Lessor no later than six (6) months prior to the expiration of the then-current Term. Lessor and Lessee's rights and obligations for the Renewal Periods shall be upon the same terms and conditions as are cllfltained in this Lease. Base Rent during the ; 2 (. ( Renewal Periods shall annually increase as set forth in Exhibit "A" hereto, together with all other sums due and payable as additional rent under the Lease. 6. Insurance and Taxes. Lessee agrees to and shall secure from a good and responsible company or companies doing insurance business in the Commonwealth of Pennsylvania, and maintain during the entire term of this Lease, public liability insurance with a combined single limit in the amount of $1,000,000.00 for loss from an accident resulting in bodily injury to or death to persons or from damage to or destruction of property, and additionally shall secure and maintain fire and extended coverage insurance on Lessee's fixtures, goods, wares and merchandise in or on the Leased Premises with coverage in the amount of not less than the reasonably estimated value of such fixtures, goods, wares and merchandise, and to the extent required by law, workers compensation or similar insurance in form and amounts required by law. Lessee shall name Lessor as an additional insured on the aforementioned policy or policies of insurance. On securing the foregoing coverage, Lessee shall provide Lessor with written notice thereof with a certificate of insurance. Lessee understands and agrees that Lessor has secured from a good and responsible company or companies doing insurance business in the Commonwealth of Pennsylvania, and does maintain insurance including fire and extended insurance and liability coverage which is currently in existence. Inasmuch as Lessee is leasing, pursuant to the terms of this Lease, 15% of the total square footage existing in the Building, Lessee agrees to pay as additional rent 15% of the premium paid by Lessor for the aforementioned insurance coverage; the aforesaid 15% additional rental shall be paid in one-twelfth (1I12th) monthly installments in the manner and at the times set forth in this Lease. Lessee shall pay in each year, during the term, as additional rent, 15% of all real estate taxes. ad valorem taxes and assessments, general and special assessments, business use and occupancy taxes, business operation taxes, or any other tax imposed upon or levied against real estate or upon Landlord's real estate as such rather than persons generally, or payments made to a federal, state or local government authority by Lessor in lieu of any such taxes or assessrnents, including any increase in such taxes occurring after the date of this Lease. The 15% additional rental shall be paid in one-twelfth (I/l2th) monthly installments in the manner and at the times..s.et forth in this Lease.~. ,/ . c:r ~ql,f.O" \ 1;1'P/'11 7. Deposit. Lessee shall deposit ~~;s~;)on the da~~e cut ion of this Lease, a sum equal to one (I) full months rent , . , which amount shall be held as a security deposit refundable in full to Lessee if it is not in default of the terms hereunder and otherwise retained by Lessor to assure the performance of Lessee hereunder. 8. Fire and Casualty Dama~e. If the Leased Premises or any part of the Building shall be damaged by fire, flood or other casualty, and if such damage does not render all or a .substantial portion" (as determined by Lessor) of the Leased Premises or the Building untenantable, then Lessor shall proceed to repair and restore the Leased Premises with reasonable promptness. subject to reasonable delays for insurance 3 adjustments and delays caused by matters beyond Lessor's control. If any such damage renders all or a substantial portion of the Leased Premises or Building untenantable, Lessor shall cause such damage to be repaired at Lessor's expense, or may terminate the Lease as of the date of such damage upon written notice of its election to terminate to the Lessee. Lessor hereby agrees that the decision to repair or terminate shall be made within thirty (30) days of the casualty. Upon any such termination, any prepaid Base Rent, including Additional Rent, paid by Lessee shall be refunded to Lessee. Unless this Lease is terminated as provided in the preceding paragraph, Lessor shall proceed with reasonable promptness to repair and restore the Leased Premises, subject to reasonable delays for insurance adjustments and delays caused by matters beyond Lessor's control and also subject to zoning laws and building codes then in effect. Notwithstanding anything to the contrary herein set forth, (a) Lessor shall have no duty pursuant to this provision to repair or restore any portion of the alterations, additions or improvements made by Lessee in the Leased Premises or to expend for any repair or restoration amounts in excess of insurance proceeds paid to Lessor and available for repair and restoration, and (b) Lessee shall not have the right to terminate this Lease pursuant to this provision if the damage or destruction was caused by the willful act of Lessee, its agents, partners or employees. In the event any such fire, flood or casualty damage not caused by the willful act of Lessee, its agents, partners or employees, renders the Leased Premises untenantable and Lessee is unable to occupy the Leased Premises due to the untenantable condition, and if this Lease shall not be terminated pursuant to the foregoing provisions of this paragraph by reason of such damage, then Base Rent and Additional Rent shall abate during the period beginning with the date of such damage and ending with the date when Lessor completes its repair and restoration. Such abatement shall be in an amount bearing the same ratio to the total amount of Base Rent and Additional Rent for such period as the portion of the Leased Premises not ready for occupancy from time to time bears to the entire Leased Premises. If the damage to the Leased Premises is such that the whole of the Leased Premises is rendered untenantable for Lessee's use, Base Rent and Additional Rent shall abate in its entirety until such time as the Leased Premises is rendered tenantable for Lessee's use. In the event of termination of this Lease pursuant to this provision, Base Rent and Additional Rent shall be apportioned on a per diem basis and be paid to the date of the fire, flood or casualty. 9. Utilities. Beginning on the Commencement Date, Lessee shall during all terms hereof pay all charges for telephone. gas, electricity, sewage, water and all other utilities used in or on the Leased Premises and for the removal of rubbish therefrom immediately on becoming due and shall hold Lessor harmless from any liability therefor. Trash cleanup and control shall be held to the standards set forth by Lessor. If the premises being leased by Lessee under the terms of this agreement are not provided separate meters to measure the electricity, water, or gas provided to the Leased Premises, Lessor shall provide at its sole expense separate meters for the aforementioned utilities as well as separate sewage connections to the Leased Premises. , 4 10. Common Area~ and Fixtures. All automobile parking areas, driveways, entrances and exits thereto, and other facilities furnished by Lessor in or near the Building for the non-exclusive general common use of tenants and other occupants of the Building, their officers, agents, employees and customers, including without limitation, access roads, parking areas, loading docks, pedestrian sidewalks and ramps, parking area, loading docks, pedestrian sidewalks and ramps, landscaped areas, shall at all times be subject to the exclusive control and management of Lessor, and the Lessor shall have the right from time to time upon reasonable prior written notice to Lessee to establish, modifY and enforce reasonable rules and regulations with respect to all common areas. Lessor shall have the right to construct, maintain, operate lighting facilities in all common areas, to police the same, and upon reasonable prior notice to Lessee to change the area, level, location and arrangement of parking areas and other common areas, to restrict parking by Lessee, its officers, agents and employees to employee parking areas, to close all or any portion of said common areas to such extent as may, in the opinion of Lessor's counsel, be legally sufficient to prevent a dedication thereof or the accrual of any rights to any person of the public therein, to close temporarily all or any portion of the parking areas or other common areas, and to do and perform such other acts in and to said common areas as in the use of good business judgment, Lessor shall determine to be advisable. Lessee will pay the Lessor as further Additional Rent, assessable at the Commencement Date, 15% of Lessor's costs for common area maintenance, said Additional Rent to be paid by Lessee in monthly installments and paid in the manner and at the times set forth in this Lease. Such costs will be estimated by the Lessor at the beginning of each calendar year. Common area maintenance charges for the first year under the term of this Lease are estimated to be $1.50 per square foot as based on the information set forth on the attached Exhibit "B" hereto. At the end of each calendar year thereafter, Lessor shall determine its actual cost of maintenance of the common areas. Within thirty (30) days (or such additional time thereafter as is reasonable under the circumstances) after the end of such twelve (12) month period, Lessor shall deliver to Lessee a statement of the common area maintenance costs for such twelve (12) month period and the monthly installments paid or payable shall be adjusted between Lessor and Lessee and Lessee shall pay Lessor and Lessor shall credit Lessee's account (if such adjustment is at the end of the term, pay Lessee as the case may be, within thirty (30) days of receipt of such statement the amount of any excess or deficiency in Lessee's proportionate share of the common area cost paid by Lessee to Lessor during such twelve (12) month period. II. Use. Waste and Nuisance. Lessee shall use and occupy the Leased Premises throughout the term hereof fllr medical office purposes only and activities attendant thereto. Lessee shall not knol>. ingly use or occupy the LelL\'ed Premises in any manner or for any purpose which voids or makes voidable any insurance covering the Building, or which would violate the pm' isions of any mortgage, easement or restrictive covenant affecting the Building. 5 Lessor and Lessee covenant throughout the term and at their respective expense, to comply promptly with all laws, codes, ordinances, administrative and court orders and directives, rules and regulations which have the force of law, including without limitation the certificate of occupancy for the Building, and all covenants, declarations and easements affecting the Building, whether now in effect to hereafter promulgated. The parties shall have the right to contest the applicability and/or validity of any of the above with the prior written consent of the other so long as by reason of such action, the Leased Premises or the Building would not be in danger of forfeiture or loss and further provided the same does not subject Lessor or Lessor's interest in the Building to any fine, penalty, lien or civil or criminal liability. Lessee shall not commit or suffer to be committed, any waste of the Leased Premises, nor shall Lessee maintain, commit or permit the maintenance or commission of any nuisance on the Leased Premises or use the Leased Premises for any unlawful purpose. 12. Repairs and Initial Alterations by Lessee. Lessee agrees to keep the interior and exterior of the Leased Premises in good order and repair, reasonable wear and tear excepted. All maintenance and repair of the Leased Premises, excluding structural damages shall be repaired promptly by Lessee at its expense. Lessor shall maintain and repair all load bearing exterior walls and, in the first year of the Lease term, replace or repair the Building roof, as needed, and maintain the same at all times thereafter. All plumbing, heating, air conditioning, electrical, and other systems servicing the Leased Premises shall be maintained by Lessee. All such work will conform to all local, state and federal standards, as required. To the extent that Lessee has requested permission from Lessor and Lessor has granted permission to Lessee to make initial alterations to the Leased Premises, these alterations shall be explicitly described on Exhibit "C" hereto. Lessee will at its expense replace promptly any cracked or broken plate glass. damaged or broken from any cause whatsoever in and about the Leased Premises. The Lessee may at its option maintain glass insurance on all plate glass in an insurance company properly licensed to do business in the Commonwealth of Pennsylvania and approved by Lessor, and shall provide Lessor with a certificate of insurance evidencing the same. The certificate shall contain a clause stating that the insurer will not cancel or change the insurance without first giving Lessor thirty (30) days prior written notice. 13. Alterations. Improvements and Fixtures. Lessee shall not further alter or improve the Leased Premises without the prior written consent of Lessor to do so, which consent shall not be unreasonably withheld. Any and all alterations, additions, improvements and fixtures (except trade fixtures which Lessee shall be permitted to remove from the Leased Premises at any time during the term hereof or within thirty (30) days after the expiration or termination of this Lease and not otherwise if such removal can be effected without injury to the Leased Premises and if such fixtures shall not have become, by the manner in which the tixture is installed, an integral part of the Leased Premises) made or placed in or on said Leased Premises, including any approved exterior signage, shall on the expiration or sooner termination of this Lease belong to Lessor without compensation to Lessee; provided. however, Lessor shall have the option, to be I> exercised on the expiration or Sooner termination of this Lease, to require Lessee, at Lessee's expense, to remove any or all of such additions and irnprovements or fixtures. Before installing any fixture in or on the Leased Premises, Lessee shall submit plans and designs therefore to Lessor for its approval and in the event that the plans and designs are disapproved by Lessor, such fixtures shall not be installed until any changes required by Lessor are made. All alterations and other changes shall conform to all local, state and federal standards as required. Specifically, any equipment installed shall be done in conformance with local and state fire and safety standards. 14. Siins. Lessee shall not place any signs on the exterior of the Leased Premises or Building without the written consent of Lessor, said consent not to be unreasonably withheld. All permitted exterior signs shall conform to local ordinances regarding size and placement of signs. If so permitted pursuant to local ordinance, Lessor shall affix to the existing pylon sign at the Leased Premises advertisement of Lessee's presence in a manner so as to occupy no less than 20% of said sign and to be apparent on both sides of said sign. In no event, however, shall any sign be attached to the roof of the Building. Removal of any approved signage shall be in accordance with the provisions of Section 13 above. 15. Ouiet Enioyment. Lessor shall, on the commencement date of the term of this Lease as hereinabove set forth, place Lessee in quiet possession of the Leased Premises and shall secure Lessee in the quiet possession thereof against all persons lawfully claiming the same during the lease term and any extension thereof. 16. Surrender of Premises. Lessee agrees to and shall, on the expiration or sooner termination of the term hereof, promptly surrender and deliver the Leased Premises to Lessor without demand therefor in good condition, ordinary wear and tear excepted. 17. Condemnation. If during the term of this Lease or any extension or renewal thereof, all of the Leased Premises should be taken for any public or quasi public use under any law, ordinance or regulation or by right of eminent domain, or should be sold to the condemning authority under a threat of condemnation, this Lease shall terminate and the Base Rent including any Additional Rent due pursuant to the terms hereof shall be abated during the unexpired portion of this Lease, effective as of the date of taking of said premises by the condemning authority. Any prepaid Base Rent and Additional Rent shall be refunded to Lessee. If less than all of the Leased Premises shall be taken for any public of quasi public use under any law, ordinance or by right of eminent domain, or should be sold to the condemning authority for condemnation, the Lessee shall have the option to terminate the Lease in its entirety, and the Base Rent including any Additional Rent due shall be abated effective as of the date of taking of said premises by the condemning authority. Any prepaid Base Rent and Additional Rent shall be refunded to Lessee. If Lessee elects not to terminate, Lessor shall forthwith at its sole expense, restore and reconstruct the Lease Premises, provided such restoration or reconstruction shall make the same reasonably tenantable and suitable for the use for which the premises are leased. The Base Rent and 7 ( Additional Rent payable hereunder during the unexpired portion of the Lease shall be adjusted to reflect that portion of the Leased Premises taken by the condemning authority. Lessor shall be entitled to receive and retain all condemnation awards except for any relocation damages, including but not limited to moving expenses, business interruption costs or the taking of Lessee's personal property, which may be payable to Lessee. The termination of this Lease shall not affect the rights of the respective parties to such awards. _ 18. Defaults and Remedies. (A) If Lessee shall allow the Base Rent or Additional Rent to be in arrears for more than ten (10) days after receipt of written notice of such delinquency, or shall remain in default and shall not have commenced to cure such non-payment default under any other condition of this Lease for a period of thirty (30) days after written notice from Lessor, or should any other person than Lessee secure possession of the Leased Premises, or any part thereof, by operation of law in any manner whatsoever (the "Events of Default"), Lessor may at its option, without notice to Lessee, terminate this Lease or in the alternative, Lessor may re-enter and take possession of said Leased Premises and remove all persons and property therefrom, without being deemed guilty of any manner of trespass, and relet the Leased Premises or any part thereof, for all or part of the remainder of said term, to a party satisfactory to Lessor, and at such monthly rental as Lessor may with reasonable diligence be able to secure. Should Lessor be unable to relet after reasonable efforts to do so, or should such monthly rental be less than the rental that Lessee was obligated to pay under this Lease, or any renewal hereof, plus the expenses of reletting, then Lessee shall pay the amount of such deficiency to Lessor. It is expressly agreed that in the event of default by Lessee hereunder, Lessor shall have a lien on all goods, chattels or personal property of any description belonging to Lessee which are placed in, or become a part of: the Leased Premises as security for rent due and to become due for the remainder of the current lease term, which lien shall not be in lieu of or in any way affect the statutory Lessor's lien given by law, but shall be cumulative thereof; and Lessee hereby grants to Lessor a security interest in all such personal property placed in said Leased Premises for such purposes. This shall not prevent the sale by Lessee of any merchandise during the ordinary course of business free from such lien to Lessor. In the event Lessor exercises the option to terminate the leasehold, re- enter and relet the premises as provided in the preceding paragraph, then Lessor may take possession of all Lessee's property on the Leased Premises and sell the same at public or private sale after giving Lessee reasonable notice of the time and place of any public sale or of the time after which any private sale is to be made, for cash or on credit, or for such prices and terms as Lessor deem best, with our without having the property present at said sale. The proceeds of such sale shall be applied first to the necessary and proper expenses of removing, storing and selling such property then to the payment of rent due or become due under this Lease, with the balance, ifany, to be paid to Lessee. s ( All rights and remedies of Lessor in this Lease shall be cumulative, and none shall exclude any other right or remedy at law. (B) Should Lessor fail to perform any of its duties or obligations hereunder, Lessor shall have a period of thirty (30) days after its receipt of written notice from Lessee of a failure of performance within which to commence a cure of that failure. Failure of Lessor to commence that cure within the 30-day period or to effect that cure within that 30-day period shall be an event of default under this Lease and Lessee may, at its option, elect to: I. Terminate this Lease without any penalty to Lessee upon thirty (30) days written notice to Lessor; or 2. Commence such cure itself, and Lessee may either, at its option, offset any reasonable expenses it incurs in effecting such cure against the Base Rent and other charges reasonably due and payable by Lessee hereunder, or require that Lessor immediately reimburse Lessee for its expenses; provided, however, in the event of an emergency, Lessee may effect a cure ofLessor's failure should Lessor fail to act within 36 hours of notification to do so. 19. Indemnification and Exoneration. Except with respect to claims arising from Lessor's gross negligence or willful misconduct or that of its agents, servants, or employees, Lessee covenants to indemnify and save Lessor harmless (to the extent not reimbursed by insurance required by this Lease to be furnished by Lessee) from any and all claims for liability of any nature whatever arising from any use, occupancy, construction, repairs, or other work or activity done in, on or about the Leased Premises during the term, or from any condition of the Leased Premises or anything thereon or therein during the term, or from any occurrence whatever in, on or about the Leased Premises during the term, including all of Lessor's reasonable costs, expenses and counsel fees in connection with any such claim. Except with respect to claims arising from Lessor's gross negligence or willful misconduct or that of its agents, servants, or employees, or from Lessor's failure to make repairs required of it to be made pursuant to this Lease, Lessee covenants to save harmless, protect and indemnify the Lessor from and against and all losses, damages, claims, suits or actions, judgments and costs, which may arise or grow out of any injury to or death of any person or damage to any property (including, but not by way of limitation, Lessee and employees of Lessee and its property) which is caused by the gross negligence of the Lessee, its agents or servants, sub lessees and/or assigns, or which is caused by or arises in the use and possession of the Leased Premise~ and the equipment thereon by Lessee or the operation of the business conducted by Lessee. The provisions of this paragraph shall survive the expiration or earlier termination of this Lease. ..... 9 20. Inspection by Lessor. Lessee shall permit Lessor or its agents into and upon the Leased Premises upon prior reasonable notice at all reasonable times for the purpose of inspecting the same. Lessor covenants and agrees that any such inspections shall not materially interrupt the Lessee's business operations. 21. Assill'nment. Lessee shall not assign or sublet to an unrelated third party all or any portion of the Leased Premises without the prior written consent of Lessor, which consent shall not be unreasonably withheld. Lessor is expressly given the right to assign any or all of its interests under the terms of this Lease. In the event Lessee shall, with Lessor's permission, sublet all or any portion of the Leased Premises, Lessee shall remain principally liable to Lessor for any and all rental due under this Lease notwithstanding its sublease and shall remain principally responsible for performing all the terms, conditions and covenants hereof. Any rental paid to Lessee on assignment or sublease of the Leased Premises beyond amounts otherwise due Lessor may be retained by Lessee after deducting any additional reasonable expenses incurred by Lessor in granting the assignment or sublease. Notwithstanding the foregoing, the assignment of this Lease to an affiliate of Lessee, or the transfer of this Lease by merger, consolidation or liquidation or change in ownership of Lessee shall not constitute an assignment under the Lease. 22. Notice and Addresses. All notices provided to be given under this Lease shall be given by Certified Mail or Registered Mail, or by recognized overnight delivery service addressed to the proper party at the following addresses: Lessor: Williams Associates PO Box 5967 2525 N. Seventh Street Harrisburg. P A I 7110 Lessee: PHB Management Co., Inc. Attn.: Al Glenn. Administrator Plaza 21,425 N. 21 st Street CampHill.PA 17011 23. Parties Bound. This agn:.:ment shall be binding upon and inure to the benefit of the parties hereto their resp<.'Ctive heirs, executors, administrators, legal representatives, successors and assigns (when assignment permitted by this Lease). 24. Subordination' Attomm.:nt' '-Inn-Disturbance. Lessee, at Lessor's written request, shall subordinate Lessee's intcrcst herein to any mortgage hereafter placed on the premises, provided that such mortgage.: ,hall agree in writing that Le~ee's rights hereunder shall not be diminished. Lcssee ,hall attorn to any purchaser from mortgagee 10 ( provided Lessee's rights hereunder are acknowledged and agreed to by purchaser in writing. Any reasonable expenses incurred by Lessee in subordinating or attorning to interests as provided in this paragraph shall be reimbursed to Lessee. In the event of foreclosure or other action taken under any mortgage by the holders thereof, this Lease and the rights of Lessee hereunder shall not be disturbed but shall be continued in full force and in effect so long as Lessee shall not be in default hereunder and so long as there shall not have occurred any event which with the sending of notice and/or the passage of time would constitute a default hereunder. The provisions of this paragraph are self-operative and no further instrument of subordination is required to effectuate the provisions hereof. 25. Lessee Holdini Over. In the event that Lessee holds over at the expiration of the original term of this Lease or at the earlier termination thereof, Lessor shall be entitled to all the remedies now or hereafter in effect in the Commonwealth of Pennsylvania relating to the speedy recovery of possession of lands and damages for wrongful detention. In the event of any holding over after the expiration of the term hereof, without the written consent of Lessor, Lessee shall be liable to pay to Lessor one and one-half (1- 112) times the monthly Base Rent hereinbefore specified, on the terms and conditions hereinbefore specified. The receipt and acceptance by Lessor of all or any portion of such holdover occupancy payment shall not be deemed a waiver or acceptance by Lessor of Lessee's breach of its covenant to vacate or a waiver by Lessor if its right to institute holdover proceedings or of any other rights as remedies available to Lessor hereunder or at law. 26. Contaminants. Pollutants and Hazardous Waste. No contaminant, industrial waste, pollutant, toxic or hazardous waste or substance of any kind or character whatsoever shall be used, generated, stored, processed, disposed of or discharged at the Leased Premises or into the environment (i) in such quantity or in such manner as to exceed a level at which any regulatory agency can or may take action under any environmental law, rule or regulation, (ii) in such quantity or in such manner that Lessee or any owner or occupant (including without limitation Lessor) shall have an obligation to clean-up or remediate the same under any environmental law, rule or regulation, (iii) in such quantity or in such manner as to obligate Lessee to report any release or discharge under any environmental law, rule or regulation, or (iv) or into any sanitary sewer, collection or treatment system except in conformity with the requirements of all applicable laws, rules, regulations and permits. The term "contaminant" shall mean and refer to any substance the discharge or release of which would constitute air pollution or air contamination under any applicable federal, state or local environmental law, rule or regulation, including without limitation the Air Pollution Control Act, 35 P.S. Section 4001 et seq., or regulations thereunder. The term "industrial waste" shall mean any substance which is classified as an industrial waste or 'Which would result in pollution under any applicable federal, state or local environmental law, rule or regulation. including without limitation the Clean II ( Streams Law, 35 P.S. Section 691.1 et seq., or regulations thereunder. The term "pollutant" shall mean and refer to any substance subject to control under any applicable federal, state or local environmental law, rule or regulation, including without limitation: the Federal Water Pollution Control Act, 33 V.S.C.A. Section 1251 et seq., or the Clean Air Act, 42 V.S.C.A. Section 7401 et seq., or regulations thereunder. The term "toxic or hazardous waste" shall mean and refer to any chemical, substance or material which is classified by the Environmental Protection Agency as a hazardous substance under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 V.S.C, Section 9601 et seq., or regulations thereunder, or as a hazardous waste under the Resource Conservation and Recovery Act of 1976, 42 V.S.C. Section 6901 et seq., or regulations thereunder, or which is a petroleum product, or which is classified by the Pennsylvania Department of Environmental Resources as a hazardous waste under the provisions of Chapter 75 of Title 25 of the Pennsylvania Code or which is defined or classified as "toxic of hazardous waste" under any other applicable federal, state or local environmental law, rule or regulation whether now existing or hereafter in effect. Lessee shall, on request, advise Lessor in writing of all contaminants, industrial wastes, pollutants, and toxic or hazardous wastes used in or resulting from the activities of Lessee on the Leased Premises. Lessor covenants that to the best of its knowledge as of the time of execution of this Lease, the Leased Premises are free of contaminants, industrial waste, pollutants and toxic and hazardous waste. 28. ADA Compliance. Lessor warrants and represents that to the best of its knowledge, the Leased Premises and the common areas of the Building are in compliance with the requirements of Title III of the Americans with Disabilities Act and with the corresponding state requirements (collectively, the "ADA"). Lessor further represents and warrants that any alterations, moditications, upfit or construction performed by Lessor to the Leased Premises or the common areas shall be performed in compliance with the ADA. 29. Miscellaneous. (a) Legal Construction. In case one or more of the provisions contained in this Lease for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions hereof or unenforceable provision had never been contained herein. (b) Full Agreement of the Parties. This Lease and all attachments hereto constitutes the sole and only agreement of the parties hereto and supersedes any prior understandings or written or oral agreements between the parties respecting the within subject matter. (c) Amendment. No amendment, modification or alteration of the terms hereof shall be binding unless the same be in writing, dated subsequent to the date hereof, and duly executed by the parties hereto. (d) Rights and Remedies Cumulative. The rights and remedies provided by this Lease are cumulative and the use of anyone right or remedy by either party shall not 12 ( preclude or waive the right of Lessor or Lessee to use any or all other remedies. Said rights and remedies are given in addition to any other rights the parties may have by law, statute, ordinance or otherwise. (e) Waiver of Default. No waiver by the parties hereto of any default or breach of any term, condition or covenant of this Lease shall be deemed to be a waiver of any other breach of the same or any other term, condition or covenant contained herein. (f) Attorney's Fees. In the event Lessor or Lessee breach any of the terms of this agreement whereby the party not in default employs attorneys to protect the parties' rights hereunder and prevails, then the defaulting party agrees to pay the other party reasonable attorney's fees so incurred by such other party upon a judicial finding of default. (g) Singular and Plural. Wherever the plural is used, it shall also apply to any singular of Lessor or Lessee. (h) Time is of the Essence. Time is of the essence in construing the terms of this Lease. (i) Captions and Headings. The captions and headings throughout this Lease are for convenience and reference only, and the words contained therein shall in no way be held or deemed to define, limit, describe, explain, modifY, amplifY or add to the interpretation, construction or meaning of any provision of or the scope or intent of this Lease nor in any way affect this Leasc. (j) Merger. The Parties intend that there shall be no merger of the fee and leasehold estates, notwithstanding the vesting of such estates in the same person or entity. (k) Broker. Lessee warrants and represents that Lessee has dealt with no broker in connection with this Lease except Commercial-Industrial Realty Company. In the event of any brokerage claims predicated upon dealings with Lessee in connection with the Leased Premises, Lessee agrees to defend the same with counsel of Lessor's selection and to save Lessor harmless and indemnifY Lessor against any loss, cost or damage which may arise by reason of such claim. (I) Reservation of Rights. Notwithstanding anything contained in this Lease to the contrary, Lessor hereby reserves all rights in the Leased Premises not expressly granted herein to Lessee, including without limitation air rights, oil, gas and mineral rights, and developmental rights. Lessor specifically reserves the right to construct additional improvements in the Building. Lessor further reserves the right to create cross- easements for such new improvements in order to separately sell or finance the same, and this Lease shall be subject and subordinate to such cross-easement agreements; however, such cross-easements shall not unreasonably and materially interfere with the operations of Lessee in the Leased Premises. ' (m) Transfer by Lessor. Lessor hereby reserves the right, to be exercised in Lessor's sole discretion, to transfer its interest in the Building and to assign this Lease to any such transferee, provided such transfer will not affect, alter or amend the rights of the 13 ( ( Lessee, if Lessee is not then in default, as set forth herein. Lessor shall provide written notice to Lessee of any transfer of interest in the Building or any assignment of this Lease IN WITNESS WHEREOF, this undersigned Lessor and Lessee hereto execute this Agreement as of the date and year first above written. WITNESS: LESSOR: WILLIAMS ASSOCIATES BY~-= WITNESS: LESSEE: PHB MANAGEMENT CO., INC. dffl~J~ Oi.td- ~ ~ J tl.f. 14 ,. ( EXHIBIT A BETWEEN WILLIAMS ASSOCIATES AND PBH MANAGEMENT CO., INC. 5. Base Rent b.) Monthly Payment: $/SF Year I None Year 2 $3036.44 $8.46 Year 3 $3111.81 $8.67 Year 4 $3194.36 $8.90 Year 5 $3269.73 B.ll Year 6 $3352.28 $ 9.34 Year 7 $3434.83 $ 9.57 Year 8 $3520.97 $ 9.81 Year 9 $3610.70 $10.06 Year 10 $3700.43 $10.3 I I" Option (3% increases annuaIIy) Year I $3811.70 $10.62 Year 2 $3926.55 $10.94 Year 3 $4044.99 $11.27 2nd Option (3.5% increases annuaIIy) Year 1 $4184.97 $11.66 Year 2 $4332.12 $12.Q7 Year 3 $4482.87 $12.49 I'roposaJ to Loose E.hihi. A:JABlscm;1I4199 ( / \ ( . EXHIBIT B Body: Projected Cam, Taxes, Insurance Costs for 1999-2000 Insurance $0.26/SF Taxes 0.51/SF Water Sewer 0.05/SF Snow Removal 0.20/SF Lawn Maintenance Parking Lot Maint. 0.1 O/SF Management Fee@4% of gross rent 0.321SF Common area electric. 0.05/SF j; TOTAL $ I.50/SF j; These are costs that will be paid for by the Tenant as "Additional Rent". (SOLOMON.MIKE ;WMG1ca;lIl4199) ,- I ' EXHIBIT C ~ ... O."l~ ~ - I I , i , . I I J I . . I l ~ IDI_IAM UN _ ft. ,.. .- ... 1.,.,. DI - ....".~ (a i ,.. . : , : ~ ; i . I ! ~~......... TI'7-"'-74M x' ~ crt' EXHIBIT ''B'' ( MEDICAL OFFICE SUB-LEASE 3710 Market Street, Camp Hill, PA THIS Sublease made and entered into this i611. day of January, 2001, by and between PHB Management Co., Inc., a Pennsylvania corporation (hereinafter called "Sublandlord") and by John M. SuJ/ivan, M.D.+ & Associates, LLC a Pennsylvania restricted professional company (hereinafter called "Subtenant"); WIT N E SSE T H: WHEREAS, Sublandlord leases the Premises under that certain Connnercial Lease dated as of April 14, 1999 attached as Exhibit A between Williams Associates, as landlord ("Prime Landlord") and Sublandlord, as tenant (the "Prime Lease"); and WHEREAS, Sublandlord desires to sublease to Subtenant, and Subtenant desires to lease from Sublandlord, the Premises, on the terms and conditions set forth herein; and WHEREAS, Prime Landlord joins herein for the purpose of consenting to the foregoing Sublease on the terms and conditions set forth herein. NOW TIIEREFORE, for and in consideration of Ten Dollars ($10.00) cash in hand paid and the covenants and obligations contained herein and other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged by the parties, it is agreed as follows: 1. PREMISES AND TERM - The Sublandlord hereby subleases to the Subtenant, and the Subtenant hereby subleases and hires from the Sublandlord, demised premises as outlined in Prime Lease known as 3710 Market Street, Camp Hill, Pennsylvania (the "Building"), said space consisting of 4,307 square feet at the southeast comer of the Building as is shown on the drawing attached hereto as Exhibit B and attached hereto by this reference, referred to herein as the "Premises". This Sublease shall be for a term of approximately thirty-nine (39) calendar months connnencing on February I, 2001 (the "Connnencement Date") and terminating on March 31, 2004. Unless this Sublease is terminated prior to March 31,2004, then on March 31, 2004, automatically and without the requirement of further action, this Sublease shall be extinguished and Subtenant shall become the tenant of Prime Landlord under all of the terms and conditions of the Prime Lease, except the Subtenant shall have the right to give 180 days notice of "Early Termination" under the Prime Lease beginning on October 3, 2003, subject to a penalty due from the Subtenant of $/3,078.92, (i.e. if Subtenant exercises early termination for 3-31-04, Subtenant would give notice by October 3,2003 with a penalty due from Subtenant of $/3,078.92), and as of such date Sublandlord shall be released from all of its obligations and liabilities under this Sublease and the Prime Lease.1 Should the Commencement Date be a date ( other than the first day of the calendar month, the term shall begin on the first day of the following month. The rental for the last 5 years of the Prime Lease and 2 - 3 year renewals is revised and outlined in ExhIbit C. The Subtenant acknowledges that he has had the opportunity to inspect the Premises and he is accepting the Premises in an "as is" condition. 2. RENTAL - During the first year of the term of this Sublease, rental for the Premises shall be the sum of $14.50 per square foot per annum, payable in advance without demand therefore, in equal monthly installments of $5,204.29, the first such instaIlrnent being due and payable on the first day of the first month of the term and like installment payments on the first day of each succeeding month of the term. All rental payments shall be made payable to Sublessor at 801 Cherry Street, Suite 3200, Fort Worth, Texas 76102, or at any other address that Sublessor may direct. During the second year of the term of this Sublease, the rental shall be increased to $ I 5 .08 per square foot per annum, during the third year of the term of this Sublease the rental shaJJ be increased to $15.68 per square foot per annum, and during the finaJ three months of the term of this Sublease the rental shall be increased to $16.31 per square foot per annum. Rent for any partial month from the commencement date to the first day of the next succeeding month shall be prorated upon a thirty (30) day month and shall be payable on the delivery of possession of the Premises to the Subtenant. If Subtenant has not given notice of "Early Termination" under the prime lease, and the Subtenant becomes the tenant of prime landlord by the automatic assignment provision under paragraph I, Sublandlord will grant to Subtenant one (I) months credit for the last month of rent due under this sublease. 3. SALES TAX - In the event of the enactment of any Federal, State or local sales or other tax upon rents, said tax is added to the amount of rent agreed upon between the parties. It shall be collected by the Sublandlord and remitted to the taxing authority. The Subtenant agrees to pay to the Sublandlord the amount of such tax at the time and place such other rental payments reserved herein are required. 4. PARKING - The Subtenant shall be entitled to all parking facilities provided to Sublandlord under the Prime Lease, subject to the provisions of said Prime Lease. follows: 5. SERVICES - Building services provided by Sublandlord sbaJl be as " Utilities to be used within the Premises consisting of heat, electricity, water, sewer, and air-conditioning, as such utilities are reasonably necessary for a medical office practice " All real estate taxes required to be paid by Sublandlord under the Prime Lease .. Payment of all sums required under the Prime Lease for maintenance of grounds and landscaping and snow removal 6. USE OF PREMISES - The Premises shaJJ be used by the Subtenant for the delivery of medical and ancillary health care services, sale of neutraceuticaIs, and 2 I administrative office space necessary to support such uses. The Subtenant will be responsible for the following services, at its expense: n Insurance on contents and general liability insurance as required of the tenant under the Prime Lease " Telephone service to the Premises " Trash removal, including without limitation, disposal of all infectious or hazardous waste in a lawful manner n Janitorial services " Interior repairs and non-structural repairs The Subtenant agrees that it shall occupy and use the Premises for the above purpose during the term of this Sublease or any extension thereof In the event the Subtenant shall abandon the Premises or not occupy the Premises for the purposes above stated, the SubIandlord may declare the Sublease to be terminated and repossess the said Premises without waiver of obligations of the Subtenant to the Sublandlord hereunder, or, in the alternative, the SubIandlord may exercise the rights reserved to it hereinbelow. 7. ASSIGNMENT AND SUBLETTING - Subtenant shall not assign this Sublease, or any interest therein, or sublet the Premises, or any portion thereof, without the prior written consent of the SubIandlord and Prime Landlord, which consent shall not be unreasonably withheld. Notwithstanding any assignment of this Sublease, or the subletting of the said Premises, or any portion thereof, Subtenant shall continue to be liable for the performance of terms, conditions and covenants of this Sublease, including the payment of rents. 8. CARE AND USE OF PREMISES - The Subtenant shall keep the Premises in good order and condition and surrender the Premises upon termination of this Sublease in as good a condition as received, ordinary wear and tear excepted. The Subtenant shaJI comply with the rules and regulations promulgated by the Prime Landlord governing the use of the Building, parking areas, common areas and accommodation areas for the best interest of all the Subtenants of the Building. 9. REPAIRS - The Prime Landlord is responsible for structural repairs under the terms of the Prime Lease. The Subtenant agrees to maintain the Premises in good and substantial repair and clean condition, to prevent waste, and upon the expiration or earlier termination of this Sublease to peaceably yield up and surrender the Premises in as good condition as when taken, reasonable wear and tear excepted. By taking possession of the Premises, the Subtenant agrees that the Subleased Premises are and were in a tenantable and good condition at the time of taking possession. In the event Subtenant does not so maintain and repair the Premises, Sublandlord shall have the right to enter and charge such sums as are necessary to accomplish any needed repairs or maintenance to Subtenant as additional rental hereunder. 3 ( 10. ALTERATIONS - The Subtenant shall make no alterations, additions or improvements to the Premises (such as subdivision partitions or installing waIls, panels, bookshelves, floor covering, cabinets and similar items) without obtaining the prior written consent of the Sublandlord and the Prime Landlord which consent shall not be unreasonably withheld. Any alterations shall be made only under the control and supervision of the Sublandlord and the Prime Landlord. When completed, such additions and improvements made by the Subtenant (save for movable furniture, trade fixtures and equipment) shall become the property of the Prime Landlord and shall remain upon and be surrendered with the Premises at the expiration or early Termination of this Sublease or upon the Subtenant's vacating said Premises. Unless, the Prime Landlord, at its option, requires the Subtenant to remove any such additions or improvements which they may designate in written notice delivered to the Subtenant specifYing the items to be removed. The Subtenant agrees to and shall promptly reimburse the Sublandlord for any expenses that they incur in connection with removing such items (if the Subtenant fails to do so) and restoring the Premises to the condition required hereunder. 11. SUBLANDLORD'S LIABILITY - The Sublandlord shall not be liable for damage to persons or property sustained by the Subtenant, its servants, agents, employees and invitees, when due to defects in the Building or the Premises, or any other cause beyond the reasonable control of Sublandlord. The Sublandlord shall not be liable to the Subtenant for damage to its property caused by leaking water or any other defect. The Sublandlord shall not be liable for failure or interruption of utilities in the Building occasioning injury to the Subtenant, its guests, invitees or licensees or their property nor for acts of neglect of other Subtenants in the Building. The Sublandlord shall not be liable for theft of property of the Subtenant. The Sublandlord and Subtenant agree (to the extent that such agreement does not invalidate coverage under any policy of insurance) that, in the event the Premises, or any part thereof; are damaged or destroyed by fire or other casualty that is covered by insurance of the Sublandlord or Subtenant, or the sublessees, assignees, or transferees of Subtenant, the rights of any party against the other or against the employees, agents or licensees of any party, with respect to such damage or destruction and with respect to any loss resulting therefrom, including the interruption of the business of any of the parties, are hereby waived to the extent of the coverage of said insurance. The Sublandlord and Subtenant further agree that all policies of fire, extended coverage, business interruption and other insurance covering the Premises or the contents therein shall, if possible, provide that the insurance shall not be impaired if the insureds have waived their right of recovery from any person or persons prior to the date and time ofIoss or damage. Any additional premiums for such clause or endorsement shall be paid by the primary insured. 12. SUBTENANT'S LIABILITY - The Subtenant shall indemnify and defend and save hannless the Sublandlord and its agents and employees against and from any and all claims or causes (whether groundless or otherwise) by or on behalf of any person, firm or corporation arising by reason of injury to persons or property occurring in the Premises or in the Building or upon any parking facility or appurtenance used in connection with the same, occasioned in whole or in part by any of the following: 4 ( (a) any act or omission on the part of the Subtenant or any employee or agent of the Subtenant (whether or not acting within the scope of employment or agency); (b) any misuse, neglect or unlawful use of the Premises or the Building or any of its facilities; (c) any breach, violation or nonperformance of any covenant in this Sublease on the part of the Subtenant to be observed or performed; or (d) any unlawful use of the Premises. Further, the Subtenant shall obtain and keep in effect and pay the premiums for a comprehensive public liability policy insuring the Subtenant for occurrences during the term hereof with limits of liability for personal injury or death of One Million Dollars ($1,000,000.00) for any single claim and Three Million Dollars ($3,000,000.00) for claims arising out of a single accident or occurrence, and One Hundred Thousand Dollars ($100,000.00) for property damage, and the Subtenant shall furnish the SubIandlord with a certificate of such coverage which shall provide that thirty (30) days' advance written notice be given to the Sublandlord in the event of cancellation or material change in the insurance policy and shaII name Sublandlord as an additional insured thereunder. 13. DAMAGE BY FIRE OR THE ELEMENTS - In the event the Building shall, during the term of this Sublease, be destroyed by fire, storm, earthquake, acts of God, or as a resuh of war, riots, civil commotion, or by other causes not under the control of the SubIandlord, the Sublease hereby made shall end and terminate as of the date of such destruction. shall govem In the event of partial damage to the Building, the provisions of the Prime Lease 14. LICENSES AND EASEMENTS - The Subtenant hereby grants to the SubIandlord and/or the Prime Landlord such licenses or easements in or over the Premises or any portions thereof; as shall be reasonably required for the instaJlation or maintenance of mains, conduits, pipes, or other facilities to serve the Building, or any part thereof; including but not by way of limitations, the premises of any such other tenant thereof; provided, however, that the SubIandlord or the Prime Landlord, as the case may be, shall pay for any alteration required on the Premises as a result of any such exercise, occupancy under, or enjoyment of any such license or easement, and provided further that no exercise, occupancy under, or enjoyment of any such license or easement shall result in any unreasonable interference with the Subtenant's use, occupancy, or enjoyment of the Premises as contemplated by this Sublease. Further, the SubIandlord and its authorized agents shall have the right to enter upon the Premises at all reasonable times for the purpose of inspecting the same, exhibiting the same to prospective Subtenants or purchasers of the Building, preventing waste, making 5 ( ( alterations or repairs or for any other reason permitted in the Sublease. If, during the last month of the term, the Subtenant shall have removed all or substantially all of the Subtenant's property therefrom, the Sublandlord may immediately enter and alter, renovate and redecorate the Premises without elimination or abatement of rent, or incurring liability to the Subtenant for any compensation, and such acts shall have no effect upon this Sublease. 15. SUBTENANT DEFAULT - Upon the happening of anyone or more of the following events: (a) Subtenant's failure to pay any monthly rental installment to the Sublandlord for a period of ten (10) days after receipt of written notice of such default sent, to the Subtenant by Sublandlord or the Sublandlord's agent, via certified mail with return receipt requested and copied simultaneously to the Prime Landlord. In such instance, the subtenant shall have a period of thirty (30) days from the date of receipt of said written notice to cure such delinquency. (b) Subtenant's continued failure to perform any other covenant of this Sublease for a period of ten (10) days after delivery of written notice of such default, sent, via certified mail with return receipt requested and copied simultaneously to the Prime Landlord, to the Subtenant from Sublandlord or Sublandlord's agent. In such instance, the Subtenant shall have a period of thirty (30) days from the date of receipt of said written notice to cure such delinquency. (c) Bankruptcy of theSubtenant; (d) Subtenant making an assignment for the benefit of creditors; ( e) A receiver or trustee being appointed for the Subtenant; (f) Subtenant voluntarily petitioning for relief under or otherwise seeking the benefit of any bankruptcy, reorganization, arrangement or insolvency law; (g) Abandonment of Premises by the Subtenant; (h) Subtenant's interest under this Sublease being assigned by operation oflaw; (i) Subtenant's interest under this Sublease being sold under execution or other legal process; options: The Sublandlord, at its election, may exercise one or more of the following 6 ( (a) Declare this Sublease to be terminated, ended and null and void, and re-enter upon and take possession of the Premises; whereupon, the term hereby granted and all rights, title and interest of the Subtenant in the Premises shall end. Such termination shall be without prejudice to the Sublandlord's right to collect from the Subtenant any rental which as accrued prior to such termination, together with all damages suffered by the Sublandlord because of the Subtenant's breach of any covenant under this Sublease; (b) Exercise any of the other rights of the Sublandlord under this Sublease by reason of Subtenant default thereunder. The exercise by the Sublandlord of any one or more of the options provided to it under.this Sublease shall not affect the Sublandlord's right to exercise any of its other options contained in this Sublease or available at law or in equity. 16. SUBLANDLORD MONTHLY RENTAL DEFAULT - In the event of default by SubIandlord to Prime Landlord in payment of monthly rent, Prime Landlord, at Prime Landlord's election may assume this Sublease by releasing Sublandlord from all of its obligations and liabilities under the Sublease and the Prime Lease, making Subtenant the tenant of the Prime Landlord under all terms and conditions of this Sublease. 17. SUBLANDLORD INDEMNIFICATION - In the event Subtenant pays SubIandlord monthly rental payments in accordance with the terms of this Sublease, but SubIandlord fails to pay monthly rental payments to the Prime Landlord in accordance with the terms of the Prime Lease, the Sublandlord agrees to indemnifY and save harmless the Subtenant from any and all causes of action, claims and demands whatsoever that may result from a SubIandlord defuult, including counsel fees, costs and expenses. 18. DEFAULT BY PRIME LANDLORD OR SUBLANDLORD - If the Prime Landlord or SubIandlord fails to perform any duties or obligations under the provisions of this Sublease or the Prime Lease, then upon Prime Landlord or Sublandlord's continued failure to perform any covenant of this Sublease for a period of ten (10) days after delivery of written notice of such delimit, sent, via certified mail with return receipt requested and copied simultaneously to the Prime Landlord, to the Sublandlord from Subtenant or Subtenant's agent, the Prime Landlord or Sublandlord shall have a period of thirty (30) days from the date of receipt of said written notice to cure such delinquency. In the event Prime Landlord or Sublandlord fails to cure such delinquency in the time allotted above, the Subtenant, may exercise one or more of the following options: (a) Declare this Sublease to be terminated, ended and null and void. Whereupon, the term hereby granted and all rights, title and interest of the Subtenant in the Premises shall end and the Prime Landlord and the Sublandlord shall have no further clairns, rights or causes of action against the Subtenant other than Prime Landlord's or SubIandlord's right to collect from the Subtenant any rental or payments which have accrued prior to such termination. 7 ( (b) Exercise any of the other rights of the Subtenant under this Sublease by reason of Prime Landlord or Sublandlord's default thereunder or exercise any of its other options available at law or in equity. 19. EMINENT DOMAIN - If the whole or any part of the Building shall be taken for any public or quasi-public use under any statute or by right of eminent domain or private purchase in lieu thereof, the proVisions of the Prime Lease shall govem 20. SUBORDINATION - This Sublease is subject and subordinate to the Prime Lease and to all ground or underlying leases and to all mortgages and/or deeds of trust which may now or hereafter affect such leases or the real property of which the Premises form a part, and to all renewals, modifications, consolidations, replacements and evidences thereof. This clause shall be self-operative and no further instrument of subordination shall be required by any mortgagee. In confirmation of such subordination, the Subtenant shall execute promptly any certificate that Sublandlord or Prime Landlord may request. Subtenant hereby constitutes and appoints the Sublandlord as the Subtenant's attorney-in-fact to execute any such certificate or certificates for or on behalf of the Subtenant. 21. NON-WAIVER- (a) The failure of the Sublandlord in one or more instances to insist upon strict performance or observance of one or more of the covenants or . conditions hereunder shall not be construed as a relinquishment or waiver for the future of such covenant or condition or of the right to enforce the same. (b) The receipt by the Sublandlord of rent or of any other payment required to be made by the Subtenant, or any part thereof, shall not be a waiver of any other rents or payments then due, nor shall such receipt, though with knowledge of the breach of any covenant or condition thereof, operate as or be deemed to be a waiver or such breach. (c) No waiver by the Sublandlord of any of the provisions hereof, or any of the Subtenant's rights, remedies, privileges or options hereunder, shall be deemed to have been made unless made in writing by the Sublandlord. (d) If the Sublandlord shall consent to the assignment of this Sublease or to a subletting of all or any portion of the Premises, no further assignment or subletting shall be made without the written consent of the Sublandlord first obtained. 22. REMOVAL OF FIXTURES, ETC. AT TERMINATION OF SUBLEASE - It is agreed by the parties to this Sublease that at the termination of this Sublease, in the event the Subtenant is not in default with respect to any of the terms and conditions of this 8 ( Sublease, including the payment of rentals, the Subtenant may remove from the Premises all of the Subtenant's furniture, fixtures and equipment which is not affixed or attached to the Building; provided, however, that if any damage to the Premises or the Building results from said removal, such damage shall be immediately repaired by the Subtenant at the Subtenant's cost. 23. SERVICE OF NOTICE - The Subtenant hereby appoints )t~~ fr,'Co ~,;>~. S...i.el A.w;,.. ~ )...,I::~ ;7-,,1 N &J' 51., ;/J.,j. f'I11'7110 , as its agent to receive the service of an dispossessory or distraint proceedings and notices required under this Sublease. .,. 24. SUCCESSORS AND ASSIGNS - This Sublease shaJJ be binding upon ~ the parties hereto, their respective heirs, personal representatives, successor and assigns. 25. HOLDING OVER - If the Subtenant shall for any reason hold over at the expiration of the term, or any extension hereof, such holding over shall not create a new term and the Subtenant shall be a Subtenant at will subject to eviction at anytime by the SubJandlord without notice. The rental rate in the event of such a holdover shaJJ be equal to 150% of the monthly rate in effect at the expiration of the term, or any extension hereof. 26. ENTIRE AGREEMENT - This Sublease contains the entire agreement of t/:1e parties and no representations, inducements, promises or agreements, oral or otherwise, between the parties not embodied herein shall be of any force or effect. No failure of the SubJandlord to exercise any power by the SubJandlord hereunder or to insist upon strict compliance by the Subtenant of any obligation hereunder, and no custom or practice of the parties at variance with the terms hereof shall constitute a waiver of the Sublandlord's right to demand exact compliance with the terms hereof. 27. COMMISSIONS - The Sublandlord shall be responsible for payment of all agents fees payable to Commercial-IndustriaJ Realty Company pursuant to its separate agreement with Sublandlord, and Sublandlord and Subtenant warrant and represent to each other that they have not employed or dealt with any other real estate agents or brokers relative to the leasing of the Premises, and each party indemnifies and holds the other harmless from and against any liability (including costs and attorneys' fees incurred in the defense thereof) to any other agents or brokers with whom such party may have dealt. 28. GOVERNING LAW - The validity of this Sublease, the interpretation of the rights and duties of the parties hereunder and the construction of the terms hereof shall be governed in accordance with the internal laws of the Commonwealth of Pennsylvania except to the extent that any additional agreement entered into pursuant to this Sublease by both parties may otherwise specificaIly provide. 29. SEVERABILITY - In the event any term or provision hereof shall be determined by a court of competent jurisdiction to be unenforceable, the remainder hereof shall survive and the unenforceable provision shall be reformed to form an enforceable provision consistent with the intent of the parties as evidenced herein. 9 Initial Term Year First ODtion Year Second Opti( Year f , ( IN WITNESS WHEREOF, the parties hereto have executed day and year first above written. Date: . j '-' J q \,. (J I Date: Date: Sublandlord: PHB MANAGEMENT I By: Title: V (J Subtenant: ~i JOHN M. SULLIVAN .s By: ' Prime Landlord: W~ ~ 0-+ By: ~ ~CH Title: .?t1, 6-;( , 10 '-, EXHIBIT "C" ( ( SMIGEL, ANDERSON & SACKSLLP LEROY SMIGEL, ESQUIRE PHONE: (711) 234-2401 TOLL FREE, 1-800-82:1-9761 ATrORNEYSATLAW FACSIMILE (711) 234-3611 EMAIL: Ismigel@sasllp.oom www.sasllp.com FileNo. 5873-1-2 August 9,2001 Charles McQueary, CEO PHB Management Co., Inc. Fort Worth, TX 76102 Dear Mr. McQueary: This letter is to inform you that you are in default with respect to the Medical Office Sublease executed on January 16, 2001 with John M. Sullivan, M.D. & Associates, L.L.C., of Harrisburg, Pennsylvania. The water and sewage problems persist at the leased premises, which you are required to maintain under Section 5 of the Sublease, stating the Sublandlord shall provide utilities that are reasonably necessary to conduct a medical office practice. Your continued failure to pay for the necessary maintenance at the leased premises renders it non-tenantable in its current condition. Please contact us immediately to informus of your intentions with regard to your obligations under the Medical Office Sublease. LRS:VJF:vlf cc: Michael L. Solomon, Esquire John M. Sullivan, M.D. 2917 North Front Street. HarnsbuN. Pennsvlvania 17110-1260 A PENNSYLVANIA LU,I1TED LlABlLITY PARTNERSHIP ... EXIllBIT "D" ( ( SMIGEL, ANDERSON & SACKS LLP ATTORNEYS AT LAW LEROY SMIGEL, ESQUIRE PHONE, (717) 284--3401 TOLL FREE, 1-800-822-9767 FACSIMILE (717) 23UGll EMAIL, l.mig.l~....np.com www....np.com File No. 5873-1-2 October 1,2001 Michael 1. Solomon, Esq. 212 Locust Street, Suite 500 Harrisburg,PA 17101 Re: John M. Sullivan, M.D. & Associates. LLC Dear Mr. Solomon: This letter is to inform Williams Associates that the Medical Office Sublease it held with John M. Sullivan, M.D. & Associates, LLC, is hereby declared tenninated, ended and null and void pursuant to the terms of Section 18, Default by Prime Landlord or Sublandlord' Under Section 18, notice of default of either the Prime or Sublandlord must be given in writing, which was given to PHB, Inc., and copied to Williams Associates, effective August 28, 2001. Under Section 18 of the Medical Office Sublease, either the Prime or Sublandlord must cure the default within thirty (30) days from the date of receipt of said written notice to cure such delinquency. As thirty (30) days have expired from the receipt of said written notice and since neither the Prime or Sublandlord has effectuated a cure of said delinquency. John M. Sullivan M.D. & Associates, LLC, hereby exercises its option under Section 18 to declare the Medical Office Sublease terminated. ended, null and void. It is the intention of John M. Sullivan M.D. & Associates, LLC, to vacate the leased premises within a reasonable time. Thank you for your continued cooperation. Sincerely, LeRoy Smigel LRS:vjf cc: John M. Sullivan, M.D. 2917 North Front Street. H.rri,ibUTr. PeD..ftsv]v.niA 17110.1280 A PENNSYLVANIA LIMITED LIABILITY P AltTNEllSHIP OIS-j ZO/ZO'd OlS-! 119EtEZlll s~~vs , NOS~30NV"3~lnS""O~j tl:91 IO-IO-!~O EXHIBIT "E" ,ent by: ,ANDREWS & KURTH ',. 't 214 6594401; 10/17/01 3:09PM;Jedax #937;page 2/3 I r . , ,I..;. '. .....: .,,- ~".' ,'. )' :: ,. .. ".. [l .l~......:.::._:~~" .:,' IN.-THE UNITED STATES BANKRUPTCY CO$lOCT - .{ 2001 I FOR THE NORTHERN DISTRICT OF TEXAL____..___--' FORT WORTH DMSION' rA'.J'JANA c. ~..- -i$Ht..LL., CLERK ''"!y~_._~ D':Vllty ._--~- IN RE: ~ ~ PROMEDCO OF LAS CRUCES, INC., et al'J ~ ~ Debtors. ~ Case No. 00-46863-BIH-ll (Chapter 11) Jointly Administered ORDER AUTHORIZING REJECTION OF UNEXPIRED LEASES AND EXECUTORY CONTRACTS (pROMEDCO MANAGEMENT COMPAN\') (pHB MANAGEMENT COMPANY) (PROMEDCO OF TEMPLE, INC.) (pROMEDCO OF EAST TENNESSEE) (pROMEDCO OF SARASOTA, INC.) (PROMEDCO OF MAYFIELD, INC.) lPROMEDCO OF INDIANA. INC,} Upon the motion (the "Motion") of(ProMedCo Management Company), ProMedCo of East Tennessee, Inc. ("PME'r'), ProMedCo of Sarasota, Inc. (npMSr'), ProMedCo of Mayfield, Inc.(npMMr'), ProMedCo of Temple, Inc. ("PMTr'), ProMedCo of/ndiana, Inc. ("PMll''), and PHB Management Company (''PHB'') (collectively the "Debtors"), seven of the above-captioned debtors and debtors in possession, for an order pursuant to section 365(a) of the Bankruptcy Code Authorizing Rejection of Interests in Unexpired Leases and Executory Contracts; and the Court having jurisdiction over the Motion pursuant to 28 U.S.C. U 157 and 1334 and this being a core proceeding pursuant to 28 U.S.C. 0 157(b)(2); and venue being proper before this Court pursuant to 28 U.S.C. U 1408 and 1409; and it appearing that notice of the Motion has been given to the Office of the United States Trustee, the counter parties to !he executory contracts and unexpired leases to be rejected, as set forth in the Motion (collectively, the "Contracts and Leases") and all ORDER AlJTB01UZll'lG JlE.lECTlON O. tJNEXPlRED LE.lSa....o EXECUTORY CONTRACTS. P_ I DA.UI S19U Sent by:.ANDREWS & KURTH ~ 214 659 4401 j 10/17/01 3: 1 OPMjJetlax #937jpage 3/3 ( parties who have. filed a notice of appearance and request for service of pleadings in these Chapter 11 cases, and that no other or further notice need be given; and upon the hearing on the Motion held on October 4,2001. good cause appearing therefor, it is ORDERED that the Motion is granted and the Debtors shall be, and hereby arc, auThorized to reject their interests in The Contracts and Leases and the same shall be, and hereby are, deemed to be, rejected; and it is further ORDERED that the De ors be, and hereby are, authorized to assign all of the estates' rights, Office Sublease by and between PHB and 10hn M. laims against the Debtors arising out of, relating to or in cOMection with th Sullivan Lease and the overlease between PHB and Williams (The "Overlease"); and it is further hereby is, deemed to have waived any and all claims Overlease and Williams be, precluded from asserting any such claims against the Debtors or their estates; ORDERED that the Objection filed by 10hn M. Sullivan, M.D. and Associates LLC be, and hereby is, overruled. SIGNED this .1.~y orcffakr . 2001. r ......... - lIT I /1/ BAR&vtA J. HouSat HONORABLE BARBARA 1. HOUSER UNITED STATES BANKRUPTCY JUDGE ORDU AllTIIORIZING JU:.lECTIOl'I' OF UNUI'DUD LEASES AND EXECtJToav CONTRACTS . .... a DAl..:JI.~J.z EXHIBIT "F" ( MICHAEL L. SOLOMON, Es",. THE LOCUST COURT BUILDING 2 1 2 LOCUST STREET, SUITE 500 HARRISSURG, PA 1 7101 717-255-7600 717-236-8278 (FAX) MSDLDMDN@TTANLAW.COM October 15, 2001 LeRoy Smigel SMIGEL, ANDERSON & SACKS 2917 N. Front Street Harrisburg, PA 17110-1260 Re: John M. Sullivan, M.D. & Associates, LLC Dear Lee: As you know, Dr. Sullivan's sublandlord, PHB Management, Inc., filed a petition in bankruptcy on July 14, 2001. By letter dated August 9, 2001, you purported to notify the debtor of an alleged default with regard to the condition of the subleased premises. Thereafter, on October 1, 2001, you unilaterally informed the prime landlord, Williams Associates, that the sublease was "declared terminated, ended and null and void pursuant to the terms of Section 18. . ." of the sublease. As of that date, to my knowledge, the debtor had not acted to reject the lease or the sublease as is its prerogative under the Bankruptcy Code. You assume that your interpretation of the sublease controls under the circumstances presented. To the contrary, we are both bound by the dictate of Section 362 of the Bankruptcy Code. This Section, of course, affords the debtor an automatic stay applicable, without doubt, to attempted enforcement of your client's rights under the sublease. I am unaware of any effort by or on behalf of your client to seek relief from the automatic stay. Consequently, your unilateral declarations of default and termination are void ab initio. As I earlier suggested, it behooves the remaining parties to the sublease to discuss alternative resolutions to the problem; today, I modify my earlier suggestion by adding that such a meeting occur when either or both of our clients have leaal standina to consider alternatives. Please give these thoughts your full and immediate consideration. Sincerely, Michael L. Solomon EXIllBIT "G" ( ( MICHAEL L. SOLOMON, ESQ. THE LOCUST COURT BUILDING 21 2 LOCUST STREET, SUITE see HARRISBURG, PA 1 71 C 1 717-255-7600 71 7-236-a278 (PAX) MSCLDMClN@TTANLAW.CCM October 17, 2001 LeRoy Smigel SMIGEL, ANDERSON & SACKS 2917 N. Front Street Harrisburg, PA 17110-1260 NOTICE OF ASSUMPTION OF SUBLEASE Dear lee: Consider this letter confirmation of the information provided in my October 15 letter to you. Specifically, I am now informed that the Bankruptcy Court issued an Order granting PHB Management's Rejection Motion on October 4, 2001. The Order encompassed the "Overlease" for the premises occupied by Dr. Sullivan. Inasmuch as a lease rejection by a debtor is tantamount to a condition of breach, we are now at the crossroads over which you prematurely tried to steer in your August notice of default. Properly juxtaposed, this is also the appropriate time for Williams Associates to exercise its assumption of the Sublease as it is permitted to do under Section 16 of the Sublease. In so doing, Williams Associates will now commence repair of the faulty plumbing line at the premises. Kindly advise as to any dates or times when it would be inconvenient to your client to have contractors, adjusters, estimators or the like visit the premises. We will not undertake any significant repairs without Dr. Sullivan's knowledge and permission. Meanwhile, my client is aware of a letter being distributed by Dr. Sullivan to patients and other parties in interest advising of his pending relocation, and further insinuating or directly attributing the departure to actions by the landlord. To the extent that any misstatements of fact are being leveled against Williams Associates, I encourage you to lend appropriate advice to your client. Given the illegal nature of the announced termination of sublease, it occurs to me that Dr. Sullivan, instead, ought to be reconsidering his decision to relocate. I anxiously await your report. Sincerely, Michael L. Solomon cc: Williams Associates EXIllBIT "H" Rece.1.ved: 11/26/01 10:S1AM; , . 717 236 8278 -> LAW OFFICES OF MARKIAN SLOBODIAN; TrA&N 2146594401; 11121101 US BANICRUI'1'CY CT 1"1' "lC'1'1I IaJ 0021003 7:10PM;~ '475iPige 3/6 "'=IV",. 11/26/01 09: 34 Sent by: ANDREWS & KURTH 11/19/2001 12:52 F~l 817 333 6001 '6'717 236 8278 " . . '-./ '---" , i~tered Debtors. Upon the Motion (the "Motion") ofPHB Management Company ("PHB") one of the above- caption=d debtors and debtors inpossessioll to Approve AssigrunentofCauses of Action to Williams Associates ("Williams"); and the Court being fully advised in the premises Ill1d having detmnined that the lega! and ti.ctual basel; set forth in 1M Motion and at the hearing thereon establish just cause for the relief granted berein; and upon the record of ~ese Chapter 11 cases and after due deliberation, and good cause appearing therefor, IT IS HEREBY FOUND THAT:l (1) This Coun has jurisdiction over the Motion pursuantto 28 U .s.C. U 157 and 1334; (2) The Motion presents a core proceeding pursuant to 28 V.S.C. i157(b )(2); (3) Notice of the Motion was sufficient undsr the circumstances pursuant to Section 363(b)( I) of the Bankruptcy Code, Bankruptcy Rules 2002, 6004, 9006 and the Local Bankruptcy ~ ! Rules: (:lpit::Llizcd l~nn~ u.sed but tlln dtflnoc) ba1lin bay!! Iho lnCPlinp .ucribcd lei INch lCIlDS ill. tM :Mt.cion. ORDiR GaA.'lTlNG MOTIO;\/ TO APPROVE ASSIGNMENT OF C.U;!lE!~ aii' ACTION 1.'0 WU.LIAMS ASSOCIATES (I"tlll MAN^G~N,)' c.o~r~'Y) - S-&I;. 1 DA1.;J22.'3~.1 Page 2 loq( . Recei.ved: 11/26/01 10:51AM; 11/26/01 09:34 tr717 236 Sent by: ANDREWS & KURTH 11/19/2001 12:53 FAX 817 ~33 6001 717 236 8278 -> LAW OFFICES OF MARKrAN SLOBODIAN; Page 3 tal 003/003 7: 1 OPMlJeHix #475jpage 4/6 1IYUY.:a 8278 TTA&N 2146594401j 11/21/01 LIS BANlRtlP1'CY &"1' H' WKl'Il .... ,e'.' --... ."""'--:..... (4) The assigmnent by PHS orits rights, claims and caUlies of aciio'n (the "Claims") arisins Ol.lt of. relating to or in connection with the Leases in the mllnner and. on the terms set forth in the Motion is within the sound exercise ofl'HB's business judgment and is in the best interests ofPHB and its estate and credito[$; NOW, THERF:FORE, IT IS ORDERED THAT: (A) The findings of fact and conclusions of law set forth above shall be, and hereby are, so ontered; (B) The Motion is hereby granted in all respects; (C) Thc assignment ofthc Claims of PH .a under the Leases be, and hereby is, approved in all re~ts; (0) Williams be, and hereby is deemed to have waived any and all claims against PHS's estate arising out of, or relating to or in cOllncction with the Leases ineludillg, but not limited te, claims for rejection damages and payment ofpostpetirion rent; (E) Williams be, and hereby is deemed to be, the owner of all Claims under thcLellSes, and. Williams be, and hereby is, deemed to have auCl:Ccdcd to all ofPHB's and the estate's interests therein, subject to such defenses and defects as PHB ~~~J~\Y,'v,~ been subject, had pEffi asserted . ........-- .....- such Claims in its 0....11 right; and . .' : .. ... . . ...__.':~_' ..' ..~~ ~;.I . ,i' ' (f) Notwithstanding the, V,t~Y\jj9~s of BanlQ'upic:j'Rule 6004(g), this Ord.er shall be effective immediately, ....J.'.:~. ,'" .. " SIGNED this .Ji day of , ,.,:.~t,..,JY, '~: ,2001. . .;~~...:,;..' .f.. 'I ,. I. .. ." t, '. ~""" '.~!""I ""'.,A,. .... .....,'1.~.1 ,:~......- .. .0, .-.:~i~~..:.t.~.'tl'.' :i.~~ ' 1(." ': BABBARA J. HOUSER ""nr'" UNITm STATES BANKRUPTCY RIDGE , ,I. ...., ..." ORDltR CRANTING MOTION 10 "PPIlOVE ASllLGNMEI'o'T OF ~...tlSl'<S 0" A''''ION TO WII.l.'''M~ ...$$OC.1......U (PHB MA"ACE1IRNT COMPANY). .>c. 2 P.\t:J12fi~5, 1 I >- ,~ J i'= r~ ('-: ! ,.~ 7 ~ ....::: '5,.,:; (.-. ,._)..... ( ~ ;,., L_ :::::j .. >- r- :_;'i- (l) , N "12 .. U~15 --" c:; tJ) D... f~. :c: :.~ u_ :-:J 0 c, () SMIGEL, ANDERSON 8: SACKS AT I UI-CN ~YS AT LAW 2917 NORTH FRONT STREET HARRISBURG. PENNSYLVANIA 17110-1223 (717) 234-2401 WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY. PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIA TES, LLC. DEFENDANT CIVIL ACTION - LAW CERTIFICATE OF SERVICE I, LeRoy Smigel, Esquire, attorney for Dcfendant in the above-captioned matter, do hereby ccrtify that I served a true and correct copy of the Rule to Filc Complaint on counsel for the Plaintiff by depositing same in the U.S. Mail, on November 7,2001, postage prepaid for first class mail, addressed as follows: MARKIAN R. SLOBODIAN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG, P A 17108-1967 MICHAEL L. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISBURG, PA 17101 By: LeRoy Smig , Esquire 2917 North Front Street Harrisburg, PA 17110-1260 (717) 234-2401 Attorneys for Defendant -- ~~ - .... 5873.1.2/preliminary objections/LRS/vlf January 10.2002 II :46 AM. WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCLATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS CIVIL ACTION - LAW PRELIMINARY OBJECTIONS TO PLAINTIFF'S COMPLAINT AND NOW, comes Defendants, John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.C., and John M. Sullivan, by and through their attorneys, Smigel, Anderson & Sacks, and files this Preliminary Objection in the Nature of a Demurrer for failure to state a claim against said Defendants, and challenges Plaintiffs standing to plead in the above-captioned matter for the reasons hereinafter set forth: PRELIMINARY OBJECTION IN THE NATURE OF A DEMURRER FOR FAILURE TO STATE A CLAIM I. Plaintiff's Cornplaint alleged several causes of action against John M. Sullivan ("Dr. Sullivan"), individually. 2. Plaintiff's Complaint contained no facts alleging that Dr. Sullivan, individually, was liable to Plaintiff in this matter. 3. The facts alleged in Plaintiff's Complaint did not state a cause of action against Dr. Sullivan, individually, because the alleged facts did not establish that Dr. Sullivan, individually, entered into a Medical Office Sublease agreement with PHB, Inc., ("PHB") deblor or Plaintiff, Williams Associates. 4. On its face, Plaintiffs Complaint is insufficient to support a claim against Dr. Sullivan, individually. WHEREFORE, Defendant, John M. Sullivan, individually, respectfully requests that this Court sustain his preliminary objections in the nature of a demurrer and enter an order dismissing Plaintiffs Complaint against John M. Sullivan for the reason that Plaintiff has failed to state a cause of action. PRELIMINARY OBJECTION IN THE NATURE OF A DEMURRER FOR FAILURE TO STATE A CLAIM 5. Plaintiff s Complaint alleged several causes of action against Cardinal Therapies, P.C. 6. Plaintiffs Complaint contained no facts alleging that Cardinal Therapies, P.C., was liable to Plaintiff in this matter. 7. Cardinal Therapies, P.c., did not execute a lease agreement with PHB/debtor, nor did Cardinal Therapies, P.C., execute a lease agreement with Plaintiff, Williams Associates. 8. On its face, Plaintiffs Complaint is insufficient to support a claim against Defendant Cardinal Therapies, P.C. WHEREFORE, Defendant, Cardinal Therapies, P.C., respectfully requests that this Honorable Court sustain its Preliminary Objections in the nature of a demurrer and enter an Order dismissing Plaintiffs Complaint against Cardinal Therapies, P.C., for the reason that Plaintiff failed to state a cause of action upon which relief may be granted. - 2 - PRELIMINARY OBJECTION IN THE NATURE OF A DEMURRER FOR FAILURE TO STATE A CLAIM 9. Plaintiffs Complaint failed to state facts constituting a cause of action against John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.C., and John M. Sullivan ("Defendants"). Moreover, the alleged facts established that John M. Sullivan, M.D. & Associates, LLC, properly followed the terms and conditions of the sublease, exercising its right to terminate the Sublease upon the default of the Prime Landlord, Williams Associates. 10. On or about July 14,2001, PHB/debtor and Sublandlord, filed a voluntary Petition under Chapter II ofthe United States Bankruptcy Code with the Bankruptcy Court for the Northern District of Texas, Ft. Worth Division. II. Under Section 18 ofthe Medical Office Sublease between John M. Sullivan, M.D., & Associates, LLC, and PHB, written notice of default of either the Prime Landlord (Williams Associates) or Sub landlord (PHB) must be given to both the Sub landlord and Prime Landlord. Written notice of default was given to PHB and copied to Williams Associates, on August 28,2001. (See Exhibit C and Exhibit 0 of Plaintiffs Complaint). 12. By letter dated August 9, 2001, Defendant John M. Sullivan, M.D., & Associates, LLC, by its counsel, declared a default by PHB, as Sub landlord, due to certain water and sewage problems on the leased premises. Said letter was sent via certified mail with return receipt requested and copied simultaneously to the Prime Landlord, Williams Associates. 13. Prime Landlord, Williams Associates, received proper notice of default according to Section 18 of the Medical Office Sublease, as admitted in Paragraph 9 of Plaintiffs Complaint. - 3 - 14. Under Section 18 of the Medical Office Sublease, either the Prime Landlord or the Sub landlord must cure the default within thirty (30) days frorn the date of receipt of said written notice, thereby giving either the Sublandlord, PHB, or the Prime Landlord, Williams Associates, an opportunity to cure such default. 15. Following the expiration of the thirty (30) days, Defendant John M. Sullivan M.D. & Associates, LLC, executed a letter dated October I, 2001, providing written notice to Plaintiff, Williams Associates, that since neither the Prime Landlord (Williams Associates) nor the Sublandlord (PHB) had effectuated a cure of said default, Defendant, John M. Sullivan, M.D. & Associates, LLC, exercised its option under Section 18 of the Medical Office Sublease to declare said Medical Office Sublease terminated, ended, null and void. (See Exhibit A of Plaintiffs Complaint for the Medical Office Sublease; Exhibit 0 of Plaintiffs Complaint for the letter dated October I, 200 I). 16. By letter dated October 1, 2001, John M. Sullivan, M.D. & Associates, LLC, stated its intention to vacate the leased premises within a reasonable time. (See Exhibit 0 of Plaintiffs Complaint). 17. Defendant John M. Sullivan, M.D. & Associates, LLC, in fact vacated the premises within a reasonable time, on or about October 29,2001. (See Paragraph 49 of Plaintiffs Complaint). 18. Plaintiff contends that the automatic stay applied to Sublandlord PHB/debtor and Prime Landlord Williams Associates. However, the automatic stay did not apply to Prime Landlord, Williams Associates, since automatic stay provisions are not available, nor do they inure to the benefit of non-debtors. Matter ofGEC Industries. Inc., Bkrtcy. D. Del. 1990, 116 B.R. 932; See Carwav v. Progressive County Mut. Ins. Co., S.D. Tex. 1995, 183 B.R. 769 -4- (holding that although automatic stay provisions provide for automatic stay of any judicial proceeding against debtor in Chapter 11 bankruptcy, it generally does not extent to non-debtors, such as insurers and co-Defendants who may have some connection to debtor.) 19. Plaintiff, Williams Associates, was a non-debtor. 20. Plaintiff, Williams Associates, being a non-debtor, was not afforded the protection from the automatic stay. Therefore, Plaintiff, Williams Associates, was in default of said Medical Office Sublease for its failure to cure said default within 30 days as required under Section 18 ofthe Medical Office Sublease. 21. Assuming arguendo, even if Plaintiff, Williams Associates, non-debtor, was afforded protection by the automatic stay applicable to debtor PHB, when PHB's Prime Lease with Plaintiff, Williams Associates, was rejected pursuant to the bankruptcy statute, the sublease under that Prime Lease must also have been rejected. Chaltos Svstems. Inc. v. Kaplan, D. Del. 1992, 147 B.R. 96, affirmed 998 F.2d 1005, on remand 163 B.R. 435. 22. On October 4, 2001, the Bankruptcy Court for the Northern District of Texas, Ft. Worth Division, granted debtor PHB's Motion to Reject the Prime Lease, approximately 82 days from the date PHB filed the voluntary Petition under Chapter 11 of the United States Bankruptcy Code with the Bankruptcy Court for the Northern District of Texas, Ft. Worth Division on July 14,2001. (See Exhibit E of Plaintiffs Complaint). Additionally, by failing to assume or rej ect the Prime Lease within sixty (60) days of filing the Bankruptcy Petition, said Prime Lease was automatically rejected by operation ofIaw on or about September 14,2001, pursuant to 11 U.S.C. g 365 (d)( 4). 23. In Bankruptcy, the rejection of an executory contract results in its termination. See In Re Port Angeles Waterfront Associates, 9th Cir. Bap (Wash.) 1991, 134 B.R. 377. - 5 - 24. II V.S.C. ~ 365(h) governs the rights of a lessee whose lease has been rejected by a debtor-lessor. Section 365(h) permits only the lessee to choose whether to remain in possession under the terms of the lease or treat the lease as terminated by the rejection. See also In Re Carlton Restaurant. Inc., Bkrtcy. E.D. Pa. 1993, 151 B.R. 353; In Re Giles Associates. Ltd., Bkrtcy. W.D. Tex. 1988,92 B.R. 695 (holding that automatic rejection of a lease based on a debtor's failure to assume or rej ect lease within sixty (60) days after filing was not merely "breach" oflease, but rather, terminated lease as to all parties, including secured creditors). 25. Defendant, John M. Sullivan, M.D., & Associates, LLC, exercised its right to terminate the Medical Office Sublease pursuant to Section 18 of the Medical Office Sublease and subsequently vacated the premises within a reasonable time. Additionally, Defendant, John M. Sullivan, M.D., & Associates, LLC, exercised its right to terminate the Medical Office Sublease by operation oflaw pursuant to 11 U.S.C. ~ 365(h), where upon sixty (60) days after PHB filed its Petition in Bankruptcy, the Prime Lease and any Subleases were automatically rejected on or about September 14, 2001, thereby rendering the Medical Office Sublease terminated. 26. Regardless of whether or not the automatic stay afforded Plaintiff Williams Associates any protection, the Medical Office Sublease, which is the basis of Plaintiff's Complaint, was properly terminated according to the terms of the Medical Office Sublease and was also terminated by operation oflaw pursuant to 11 U.S.c. ~ 365(h). Moreover, Defendant, John M. Sullivan, M.D. & Associates, LLC, vacated the leased premises within a reasonable time, on or about October 29,2001. 27. On its face, Plaintiffs Complaint is insufficient to support a claim against Defendants, John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.C., and John M. Sullivan. -6- WHEREFORE, Defendants respectfully request that this Honorable Court sustain their Preliminary Objections in the nature of a demurrer and enter an Order dismissing Plaintiffs Complaint against Defendants for the reason that Plaintiff failed to state a cause of action upon which relief may be granted. PRELIMINARY OBJECTION ON GROUND OF LACK OF CAPACITY TO SUE 28. Defendants incorporate herein by reference Paragraphs I through 27 as though set forth herein at length. 29. Defendants, in the above-entitled action, request that this Honorable Court enter an Order dismissing the instant action on the ground that the Plaintiff, Williams Associates, lacks standing and the legal capacity to sue the Defendants. 30. "A party seeking judicial resolution of a controversy in this Commonwealth must, as a prerequisite, establish that he has standing to maintain the action." Nve v. Erie Insurance Exchange, 504 Pa. 3, 5, 470 A.2d 98,100 (1983), citing William Penn Parking Garage. Inc. v. City ofPittsburiili, 464 Pa. 168,346 A.2d 269 (1975). 31. "As a general matter, the core of the concept of standing is that a person who is not adversely affected in any way by the matter he seeks to challenge is not aggrieved thereby and has no right to obtain a judicial resolution of his challenge." Pennsvlvania Game Commission v. Deot. of Environmental Resources, 521 Pa. 121, 127,555 A.2d 812,814 (1989). 32. In William Penn Parking Garage, supra, the Supreme Court of Pennsylvania observed that what is necessary to render a person aggrieved is that the party has a substantial, direct and immediate interest in the claim sought to be litigated. - 7 - 33. The Plaintiffs Complaint set forth allegations of a claim for various actions as a result of Defendant John M. Sullivan, M.D., & Associates, LLC's failure to make rental payments and by prematurely and improperly declaring the sublease to be terminated. 34. Defendant John M. Sullivan, M.D., & Associates, LLC alleged that the Medical Office Sublease was properly terminated, as the result of Prime Landlord's (Williams Associates) default. Additionally, the Medical Office Sublease was terminated by operation of law for the failure to assume or reject the Prime Lease within the required sixty (60) days from the date of filing the debtor's (PHB) Motion in Bankruptcy. Additionally, the Medical Office Sublease was terminated when the Motion to reject the Prime Lease was granted by the Bankruptcy Court for the Northern District of Texas, Ft. Worth Division on October 4, 2001. (See Exhibit E of Plaintiffs Complaint). 35. Plaintiff had a right under both the provisions ofthe Medical Office Sublease and II V.S.C. ~ 365(h) to terminate the Medical Office Sublease. 36. Defendant John M. Sullivan, M.D. & Associates, LLC, exercised its option to terminate the Medical Office Sublease and subsequently vacated the leased premises within a reasonable time. 37. As the termination of the Medical Office Sublease was proper, Plaintiff is not an aggrieved party with a substantial, direct and immediate interest in the claim sought to be litigated. 38. On its face, Plaintiffs Complaint failed to set forth any facts to establish the legal capacity to sue, which is necessary to support a claim against Defendants, John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.C., and John M. Sullivan. - 8- WHEREFORE, Defendants respectfully requests that this Honorable Court enter an Order dismissing Plaintiffs Complaint against Defendants for the reason that Plaintiff lacks capacity to sue. Respectfully submitted, Date: 1- It) - O?- :GEL'1l;J;; LeRoy Smigel, Esquire ill #09617 Keith J. Figured, Esquire ill #87443 Valerie J. Faden, Esquire ill #87442 2917 North Front Street Harrisburg, PA 17110-1260 (717) 234-2401 Attorneys for Defendants -9- WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS CIVIL ACTION - LAW CERTIFICATE OF SERVICE I, LeRoy Smigel, Esquire, attorney for Defendants in the above-captioned matter, do hereby certify that I served a true and correct copy of the Preliminary Objections to Plaintiffs Complaint on counsel for the Plaintiff by depositing same in the U.S. Mail, on January 10, 2002, postage prepaid for first class mail, addressed as follows: MARKIAN R. SLOBODIAN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG, PA 17108-1967 MICHAEL L. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISBURG, PA 17101 SMIGEL, ANDERSON & SACKS By: ,Esqu' ID #09617 2917 North ront Street Harrisburg, PA 17110-1260 (717) 234-2401 Attorneys for Defendants >- 1J? . i- ~, (I_\?'- c> ('-. w..- I'" u_ C) Cl ?-= :L-: :;~~ .:=( {(-~:t ---" ....-( c'\?3 :?S~ ,-c:::..: ujLl.1 d)~ ':<:..:;........ '5 (,) "'~ ~ c...\ r,::) WILLIAMS ASSOCIATES, PLAINTIFF : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PA v. : CIVIL ACTION - LAW JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.c. & JOHN M. SULLIVAN, : NO. 01-6201 - Civil Term DEFENDANTS PLAINTIFF'S REPLY TO DEFENDANTS' PRELIMINARY OBJECTIONS NOW COMES, Plaintiff, Williams Associates, by its counsel, The Law Offices of Markian R. Slobodian, and Michael L. Solomon, Esq., and makes the following response to Defendants' Preliminary Objections in the above-referenced case: Preliminary Objections in the Nature of a Demurrer for an Alle~ed Failure to State a Claim 1. Admitted. 2. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent that an answer may be required, Plaintiff denies the allegation that its Complaint contains no facts alleging that Defendant Sullivan, individually, was liable to Plaintiff in this matter. Count IV and VI of the Complaint contain specific averments regarding the actions of John M. Sullivan, individually. 3. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Plaintiff denies the allegation that its Complaint did not state a cause of action against Dr. Sullivan individually because the alleged facts did not establish that Dr. Sullivan individually entered into a medical office sublease agreement with PHB, Inc., or with Plaintiff, Williams Associates. By way of further answer, the two counts against Defendant John Sullivan individually are counts in trespass and unjust enrichment. Neither of these counts is based on the establishment of a contractual relationship between Williams Associates and Defendant Sullivan. 4. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that its Complaint is insufficient to support a claim against Defendant Sullivan individually. WHEREFORE, Plaintiff, Williams Associates requests that this Court enter an Order denying Defendant's Preliminary Objections in the Nature of Demurrer and entering judgment in favor of Plaintiff and against Defendant as more fully set forth in the Complaint. Defendant's Preliminary Objection in the Nature of Demurrer for Failure to State a Claim. 5. Admitted. 6. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent that an answer may be required, Williams Associates denies the allegation that its Complaint contains no facts alleging that Cardinal Therapies was liable to Plaintiff in this matter. Counts III and V of the Complaint contain specific averments regarding the actions of Cardinal Therapies. 7. Admitted in part and denied in part. Williams Associates admits that it did not execute a lease agreement with Cardinal Therapies, P.c. After reasonable investigation, William Associates lacks sufficient knowledge to form a belief as to the accuracy of the 2 allegation that Cardinal Therapies, P.e. did not execute a lease agreement with PHBjDebtor. Accordingly, Williams Associates denies this allegation and demands proof thereof at trial. 8. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that its Complaint is insufficient to support a claim against Defendant Cardinal Therapies, P.e. By way of further answer, Counts III and V of Plaintiff's Complaint, the counts against Cardinal Therapies, P.e., are not based on any breach of contract theory. Accordingly, Defendant's allegations that Williams Associates did not execute a lease agreement directly with Cardinal Therapies, P.e. is irrelevant. WHEREFORE, Plaintiff, Williams Associates requests that this Court enter an Order denying Defendant's Preliminary Objections in the Nature of Demurrer and entering judgment in favor of Plaintiff and against Defendant as more fully set forth in the Complaint. Defendants' Preliminary Objection in the Nature of Demurrer for Alleged Failure to State a Claim 9. Denied. This paragraph states four conclusions of law to which no answers are required. To the extent answers may be required, Williams Associates denies the allegation that its Complaint failed to state facts constituting a cause of action against Defendants. Williams Associates further denies the allegation that the facts as alleged in the Complaint establish that Defendant John M. Sullivan, M.D. & Associates, L.L.e. ("Sullivan, L.L.e.") properly followed the terms and conditions of the sublease. Williams Associates further denies the allegation that Sullivan, L.L.e. properly terminated the stIblease. Finally, 3 Williams Associates denies the allegation that it defaulted upon the terms and conditions of the sublease. 10. Admitted. 11. Denied. This paragraph seeks to summarize or characterize the provisions of Section 18 of the medical office sublease. The sublease is a written document which speaks for itself. Accordingly, Williams Associates denies any characterization or summarization of the contents of that document. Williams Associates specifically denies any inference that Sullivan, L.L.c. provided any type of legally effective notice of default to PHB or Williams Associates. By way of further answer, as a result of the Chapter 11 bankruptcy filing of PHB, any default notice which Sullivan, L.L.C. attempted to provide to PHB was in violation of the automatic stay contained in Section 362 of the Bankruptcy Code, 11 D.S.C. 9362 and therefore lacked any legal effect. 12. Admitted in part and denied in part. Williams Associates admits that Sullivan, L.L.c.' counsel forwarded to PHB a letter dated August 9,2001. Williams Associates further admits that it received a copy of the August 9, 2001 letter. Williams Associates denies any inference that the letter had the legal effect of declaring a default under the lease. By way of further answer, as a result of the automatic stay and pending rejection of the lease by PHB, the letter of Sullivan, L.L.c.' s counsel had no legal cause or effect. 13. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that it received proper notice of default according to section 18 of the medical office sublease. By way of further answer, any purported notice of default was rendered legally ineffective as a result of the bankruptcy stay. 4 14. Denied. This paragraph attempts to summarize or characterize the contents of section 18 of the medical office sublease. This sublease is a written document which speaks for itself. Accordingly, Williams Associates denies any characterization or summarization of the contents of that document. By way of further answer, the duty to make repairs is not set forth in Paragraph 18 of the Lease but, rather, in Paragraphs 5, 6, and 9 of the Lease. Paragraph 5 provides that the Sub-landlord shall be responsible for various enumerated building services. Paragraph 6 of the Lease requires that the Sub-tenant will be responsible for certain services including" interior repairs and non-structural repairs" . Paragraph 9 of the Lease indicates that the Prime Landlord is responsible for structural repairs under the terms of the Prime Lease. The Sub-tenant agrees to maintain the Premises in good and substantial repair and good and clean condition. With regard to any duties assigned to the Sub-landlord, Paragraph 16 of the Lease allows Williams Associates as Prime Landlord to assume the obligations and liabilities of the Sub-landlord only after the Sub-landlord defaults and the Prime Landlord both releases the Sub-landlord from all its obligations and liabilities under the Sub-lease and the Prime Lease and, in turn, assumes all such obligations and liabilities under the Sub-lease. Any obligation on the part of the Williams Associates under Paragraph 18 of the Lease to perform any duties and any rights of the Sub-tenant to declare a default on any such obligation of the Prime Landlord can only arise after Williams Associates can legally declare default on the Sub-landlord. As previously stated, Williams Associates could not legally do so until after the Automatic Stay no longer applied. 15. Admitted in part and denied in part. Williams Associates admits that Sullivan, L.L.c. executed a letter dated October 1, 2001. The letter is a written document which 5 speaks for itself. Accordingly, Williams Associates denies any summarization or characterization of the contents of that letter. Williams Associates further denies any inference that the letter had the effect of terminating or ending the sublease. 16. Admitted in part and denied in part. Williams Associates admits that Sullivan, L.L.c. prepared the letter dated October 1, 2001 attached to Plaintiff's Complaint as Exhibit "D". The letter is a written document which speaks for itself. Accordingly, Williams Associates denies any characterization or summarization of the contents of that document. 17. Admitted in part and denied in part. Williams Associates admits that Sullivan, L.L.c. vacated the premises on or about October 29, 2001. The allegation that Sullivan, L.L.c. vacated the premises within a reasonable time states a legal conclusion to which no answer is required. 18. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that the automatic stay did not apply to Williams Associates as Prime Landlord. By way of further answer, the automatic stay prevented Sullivan, L.L.c. from terminating its sublease with PHB, a debtor undergoing reorganization proceedings pursuant to Chapter 11 of the Bankruptcy Code. The automatic stay further precluded Williams Associates from declaring a default under the Prime Lease with PHB so that it could step into the shoes of PHB as Sub-landlord and assume the rights and responsibilities of PHB with regard to Sullivan, L.L.c. Sullivan, L.L.c. now appears to argue that because Williams Associates, a non- debtor, eventually, upon Debtor's rejection of the lease, assumed the position of the Debtor 6 as Sub-landlord, the clear prohibitions of the automatic stay which applied prior to the lease rejection should be ignored. This simply is not the law. Similarly, Sullivan, L. L.c.' s citation of legal precedent for the proposition that the automatic stay does not apply to non-debtors has no application in this case. The cases which Sullivan, L.L.c. cite allow a creditor to proceed against a non-debtor joint obligor. Williams Associates was not a joint obligor. It had no duties or responsibilities to Sullivan, L.L.c. until after it assumed the Debtor's position as Sub-landlord. It could not assume such a position until after Debtor rejected its interest in the sublease and this did not occur until October 4, 2001. 19. Admitted. 20. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that it had any duties to Sullivan, L.L.c. until after Debtor rejected the lease. 21. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that PHB's rejection of the Prime Lease with Williams Associates also absolved Sullivan, L.L.c. from any legal obligation to Williams Associates. By way of further answer, Williams Associates has a contractual relationship with Sullivan, LLC. Williams Associates' agreement with Sullivan, LLC is unaffected by PHB's rejection of its agreement with Williams Associates. 22. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates admits that on October 4, 2001, the Bankruptcy Court for the Northern District of Texas granted PHB's 7 motion to reject the Prime Lease. Williams Associates denies the allegation that the lease was automatically rejected by operation of law on or about September 14, 2001 pursuant to 11 U.S.c. s365(d)(4). That section only applies when Debtor's motion to assume or reject a lease is not timely. In this case, Debtor requested and obtained from the Bankruptcy Court an extension of time to file motions to assume or reject leases. 23. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies any inference that PHB's rejection of the Prime Lease resulted in the termination of Williams Associates' Sub-lease with Sullivan, L.L.c.. 24. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies any inference that PHB's rejection of its interests in the Prime Lease in any way excused Sullivan, L.L.c.'s obligation to make payments to Williams Associates as the substituted new Sub-landlord. 25. Denied. This paragraph states numerous conclusions of law to which no answers are required. To the extent answers may be required, Williams Associates denies the allegation that Sullivan, L.L.c. properly exercised its rights to terminate the medical office sublease, and that Sullivan, L.L.c. exercised its rights to terminate the sublease by operation of law pursuant to 11 U.S.c. s365(h). Williams Associates further denies the allegation that the Prime Lease and any subleases were automatically rejected on or about September 14, 2001 thereby rendering the medical office sublease terminated. 26. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the 8 allegation that the sublease was properly terminated according to either the terms of the sublease or by operation of law. Williams Associates admits that Sullivan, L.L.c. vacated the leased premises on or about October 29, 2001. 27. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that its Complaint is insufficient to support a claim against Defendants. WHEREFORE, Plaintiff, Williams Associates requests that this Court enter an Order denying Defendant's Preliminary Objections in the Nature of Demurrer and entering judgment in favor of Plaintiff and against Defendant as more fully set forth in the Complaint. Defendants' Preliminary Objections on Ground of Alleged Lack of Capacity to Sue 28. This paragraph incorporates by reference paragraphs 1 through 27 of Defendants' Preliminary Objections. Accordingly, Williams Associates incorporates by reference its answers to paragraphs 1 through 27 of the Defendants' Preliminary Objections. 29. Denied. This paragraph states a legal conclusion to which no answer is required. To the extent an answer may be required, Williams Associates denies any inference that Defendants are entitled to an Order dismissing the instant action on the grounds that Williams Associates allegedly lacks standing and the legal capacity to sue Defendants. 30. Denied. This paragraph states a legal conclusion to which no answer is required. 31. Denied. This paragraph states a legal conclusion to which no answer is required. 9 32. Denied. This paragraph states a legal conclusion to which no answer is required. 33. Denied. This paragraph attempts to summarize the allegations of Williams Associates' Complaint. The Complaint is a written document which speaks for itself. Williams Associates, accordingly, denies any characterization or summarization of the contents of the Complaint. 34. Denied. This paragraph states legal conclusions to which no answers are required. To the extent answers may be required, Williams Associates denies the allegation that the sublease was terminated as a result of Williams Associates' alleged default. Williams Associates further denies the allegation that the sublease was terminated by operation of law. Finally, Williams Associates denies the allegation that the sublease was terminated when the Bankruptcy Court for the Northern District of Texas granted PHB's motion to reject the Prime Lease. 35. Denied. This paragraph states a conclusion of law to which no answer is required. 36. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that Sullivan, L.L.c. effectively exercised its option to terminate the sublease. 37. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that the sublease was properly terminated. Williams Associates further denies the allegation that it is not an aggrieved party with a substantial direct and immediate interest in the claim sought to be litigated. By way of further answer, Williams Associates 10 has suffered substantial harm due to Sullivan, L.L.c.' abandonment of the lease premises and its failure to make rental payments over the remaining term of the lease. 38. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that its Complaint fails to set forth any facts to establish its legal capacity to sue. WHEREFORE, Plaintiff, Williams Associates requests that this Court enter an Order denying Defendant's Preliminary Objection on grounds of lack of capacity to sue and entering judgment in favor of Plaintiff and against Defendant as more fully set forth in the Complaint. Respectfully submitted, ~ .-'("^- Markian R. Slobodian, Esquire 10 No. 41075 Andrew R. Eisemann, Esquire 10 No. 87441 801 North Second Street p.o. Box 11967 Harrisburg, PA 17108-1967 717/232-5180 Dated: ~ { ~ 0 \ C.l- Michael L. Solom~m, Esquire 10 No. 36031 212 Locust Street, Suite 500 Harrisburg, PA 17101 717/255-7600 Counsel for Williams Associates 11 se~t &y: LAW OFFICES OF MARKIAN SLOBODIAN;717 232 6528; Jun-13-02 4:08PM; Page 2/2 VERmCATION I, Jack Solomon, Plaintiff's General and Managing Partner, hereby verify that the fac:ts contained in the foregoing Pleading arc true and corrc..'Ct to the best of my knowledge, information and belief. I understand that false statements herein arc subject to the penalties of 18 Pa. C.S.A ~904 relating to unsworn falsification to authorities. Date: v~~ CERTIFICATE OF SERVICE I, Markian R. Slobodian, hereby certify that I have this date, mailed a true and correct copy of the foregoing Plaintiff's Response to Defendants' Preliminary Objections by United States mail, first-class, postage prepaid, addressed to the following individual(s): LeRoy Smigel, Esquire Smigel, Anderson & Sacks 2917 North Front Street Harrisburg, PA 17110-1260 ~~r MARKIAN R. SLOBODIAN, ESQ. 1'4 ~ 1 0, luo l...-- >- cc; ;'S.: ~~~~ --- -' I i;_ (~) c M j:': z B~ C) :rr C):--) Y).- ~.i'. (I) .)~ --"-.""- UlU f'lD- ~~ :::l <.) )-c 0- ('cJ ;;.'" _C) "'-J .0 WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS CIVIL ACTION - LAW PETITION TO DISALLOW PLAINTIFF'S REPLY TO DEFENDANTS' PRELIMINARY OBJECTIONS AND NOW, comes Defendants, John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.e. and John M. Sullivan, by and through their attorneys, Smigel, Anderson & Sacks, and files this Petition to Disallow Plaintiffs Reply to Defendants' Preliminary Objections, and grant Defendants' Preliminary Objections filed June 20, 2002. 1. Plaintiff filed a Praecipe for Writ of Summons on or about October 26, 2001. 2. On or about November 2, 2001, the Defendants filed a Praecipe for Rule to File Complaint. 3. The Prothonotary for this Court issued a subsequent Rule to File Complaint on or about November 6,2001. 4. Plaintiff then filed a Complaint on or about November 27, 2001 alleging three claims against each Defendant: (1) Breach of Contract, (2) Unjust Enrichment, (3) Trespass. 5. Plaintiff filed a Notice of Intention to Enter Judgment By Default on or about January 4, 2002. 6. Defendants filed Preliminary Objections to Plaintiffs Complaint on or about January 10, 2002 in the nature of demurrers as to the counts and for lack of capacity to sue as to all Defendants. Attached hereto and made part of this document as Exhibit "An is Defendants' Proof of Service for the Preliminary Objections. 7. Under Local Rule 208-1, the Plaintiff had twenty (20) days in which to respond to Defendants' Preliminary Objections or was thereafter barred from responding as a matter of course. 8. To the best of Defendants' infonnation, knowledge, and belief Plaintiff never sought leave of court to file a reply to Defendants' Preliminary Objections or an amended Complaint beyond the 20-days proscribed by the Local Rule 208-1. 9. The 20-day period for Plaintiff to file a reply to Defendants' Preliminary Objections or amend the original Complaint expired on or about January 30, 2002. WHEREFORE, Defendants respectfully request that this Honorable Court strike Plaintiffs reply to Defendants' Preliminary Objections as untimely and that, in accordance with Local Rules 208-1 and 208-2, this Court enter a final decree sustaining Defendants' Preliminary Objections and dismissing this matter with prejudice. Respectfully Submitted, SMIGEL, ANDERSON & SACKS Date: '7 j,,,,k 'Z-- By: LeRoy Smi el, Esquire ill # 09617 Susan Zeamer, Esquire ill # 82023 Valerie J. Faden, Esquire ill # 87442 4431 North Front Street Harrisburg, PA 17110-1709 (717) 234-2401 Attorneys for Defendants '. WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYL VANIA v. JOHN M. SULLN AN, M.D. & ASSOCIATES,LLC,CAJUDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, No. 01-6201 CNIL TERM DEFENDANTS CIVIL ACTION - LAW CERTIFICATE OF SERVICE I, LeRoy Smigel, Esquire, attorney for Defendants in the above-captioned matter, do hereby certify that I served a true and correct copy of the Petition to Disallow Plaintiff's Reply to Defendants' Preliminary Objections on cOWlsel for the Plaintiffby depositing same in the U.S. Mail, on July 12, 2002, postage prepaid for fIrst class mail, addressed as follows: MARKJAN R. SLOBODIAN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG, PA 17108-1967 MICHAEL L. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISBURG, PA 17101 SMIGEL, ANDERSON & SACKS By --p'A.~ L:;'~i~l, ESqUi:e ill #09617 Susan Zeamer, Esquire ill # 82023 Valerie J. Faden, Esquire ill # 87442 4431 North Front Street Harrisburg, P A 1711 0-1 709 (717) 234-2401 Attorneys for Defendants (') 0 0 c: N -n s: S= ---4 -oc:' ,- [11fT! r- ~~: c.." -, r:::C; -0 :!'- of? 0 3; Zc $ c.: w :z '" ~ .-.1 5873_1_2/PraecipeArgumentlSMZ/cnn 7/26/023:44 PM WILLIAMS ASSOCIATES, PLAlNTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CNIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS CIVIL ACTION - LAW PRAECIPE FOR LISTING CASE FOR ARGUMENT TO THE PROTHONOTARY OF CUMBERLAND COUNTY: NOW COMES, Defendants, John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.C. & John M. Sullivan, by its counsel, Smigel, Anderson & Sacks, LLP, and files the within Praecipe For Listing Case For Argument: 1. The matters to be argued before this Court are the Defendants' Preliminary Objections to the Plaintiffs Complaint. The Preliminary Objections are in the form of a demurer, as Plaintiff failed to adequately state a claim, as well as Plaintiff s lack of capacity to sue. 2. The names and addresses of all attorneys who will argue the case are as follows: (a) Plaintiff: Markian R. Slobodian, Esquire Andrew R. Eisemann, Esquire 801 North Second Street P.O. Box 11967 Harrisburg, PA 17108-1967 (717) 232-5180 Michael L. Solomon, Esquire 212 Locust Street, Suite 500 Harrisburg, PA 17101 (717) 255-7600 (b) Defendants: LeRoy Smigel, Esquire Valerie J. Faden, Esquire Susan M. Zeamer, Esquire Smigel, Anderson & Sacks, LLP 4431 North Front Street Harrisburg, P A 17110-1709 (717) 234-2401 3. Within two (2) days, I will notify all parties that this case has been listed for argument once I receive a time-stamped copy of this Praecipe setting forth the argument court date. 4. Argument Court Date: Dated: if!l.b lot- ~ LeRoy Smig , EsqUIre Valerie J. Faden, Esquire Susan M. Zeamer, Esquire Attorneys for Defendants WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES,LLC,CAJUDINAL THERAPIES, P.c. & JOHN M. SULLIVAN, DEFENDANTS CIVIL ACTION - LAW CERTIFICATE OF SERVICE I, LeRoy Smigel, Esquire, attorney for Defendants in the above-captioned matter, do hereby certify that I served a true and correct copy of the Preliminary Objections to Plaintiffs Complaint on counsel for the Plaintiff by depositing same in the U.S. Mail, on January 10, 2002, postage prepaid for first class mail, addressed as follows: MARKIAN R. SLOBODIAN, ESQUIRE ANDREW R. EISEMANN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG, P A 17108-1967 MICHAEL L. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISBURG, PA 17101 By: SMIGEL, ANDERSON & SACKS, LLP ~~ LeRoy Smigel, Esquire, ill #09617 Valerie J. Faden, Esquire, ill #87442 Susan M. Zeamer, Esquire, ill 82023 4431 North Front Street Harrisburg, PA 17110-1709 (717) 234-2401 Attorneys for Defendants 0 C-. -. C r..,,",) ~~ ~ "D ,~- [! iii 7 ~~ ;?:C- 1') ~r, ; \.;,:) U_ -< .- ~~~ .1.") ~:2 ~) :2: --, -j ()) 5..; -, -< WILLIAMS ASSOCIATES, PLAINTIFF V. : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS 01-(.;20\ : ~-6~Ol CIVIL TERM IN RE: MOTION PRELIMINARY OBJECTIONS OF DEFENDANTS TO PLAINTIFF'S COMPLAINT BEFORE BAYLEY, J. AND HESS, J. ORDER OF COURT AND NOW, this ~'\~ day of August, 2002, the preliminary objections of defendants to plaintiffs complaint, ARE DISMISSED. Edgar B. Bayley, J. .; ,/Markian R. Slobodian, Esquire yAt1ichael L. Solomon For Plaintiff () . t7fi.J.. ~~ <6-.2q.C,z ,./leRoy Smigel, Esquire For Defendants :saa VlNV^lASNN3d JJ.NnCtl O~rt{)Hj8~n~ 1 S :8 WV 6 Z ~.HW 20 Ac.N10NOt.t.:.CGd :H.!. ::10 3JH:iQ--{jj'11~ WILLIAMS ASSOCIATES, PLAINTIFF v. JOHN M. SULLIVAN, M.D. & ASSOCIATES,LLC,CAJlD~AL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS TO: Markian R. Slobodian, Esquire 801 North Second Street P.O. Box 11967 Harrisburg, P A 17108.1967 ~ THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYL VANIA No. 01-6201 CIVIL TERM CIVIL ACTION - LAW NOTICE TO PLEAD Michael L. Solomon, Esquire 212 Locust Street, Ste. 500 Harrisburg, Pa 17101 You are hereby notified to file a written response to the enclosed New Matter and Counterclaim within twenty (20) days from service hereof or a judgment may be entered against you. Oat, ff/dL SMIGEL, ANDERSON & SACKS, LLP ~vuv-- lY'\, eRoy Smigel .0. #09617 Susan M. Zeam J.D. #82023 4431 North Front Street, 3rd Floor Harrisburg, P A 17110-1709 (717) 234-2401 Attorneys for Defendants ::- 'II , I " WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CAJUJINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS CIVIL ACTION - LAW DEFENDANTS' ANSWER WITH NEW MATTER AND COUNTERCLAIM ANSWER AND NOW COMES, Defendants, John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.c. & John M. Sullivan, by and through their counsel, Smigel, Anderson & Sacks, LLP and files the following Answer, New Matter and Counterclaim to the Plaintiffs Complaint as follows: 1. Denied. After reasonable investigation, Defendants John M. Sullivan, M.D. & Associates, LLC ("Sullivan LLC"), Cardinal Therapies, P.c. ("Cardinal Therapies") and John M. Sullivan ("Sullivan"), collectively referred to as "Defendants", are without knowledge or sufficient information to form a belief as to the truth of the averment. Therefore, the averment is denied. 2. Admitted. 3. Admitted. 4. Admitted. II" 5. Denied. The averment contained within paragraph 5 of the Complaint is an averment that does not pertain to the Defendants in the above-captioned matter. As such, no responsive pleading is required on the parts of the Defendants in the above-captioned matter. Therefore, the averment is denied. By way of further answer, a true and correct copy of the Commercial Lease Agreement ("Prime Lease") between PHB Management Company ("PHB") and Williams Associates ("Williams") is attached as Exhibit "A" to the Complaint. The Prime Lease is a legal document that speaks for itself. Therefore, any summarization or interpretations of the contents of that document are hereby denied. 6. Denied. The averment contained within paragraph 6 of the Complaint is an averment that does not pertain to the Defendants in the above-captioned matter. As such, no responsive pleading is required on the parts of the Defendants. Therefore, the averment is denied. By way of further answer, the Prime Lease is a legal document that speaks for itself. Therefore, any summarization or interpretations of the contents of that document are hereby denied. 7. Denied. The averment contained within paragraph 7 of the Complaint is an averment that does not pertain to the Defendants in the above-captioned matter. As such, no responsive pleading is required on the parts of the Defendants. Therefore, the averment is denied. By way of further answer, the Prime Lease is a legal document that speaks for itself. Therefore, any summarization or interpretations of the contents of that document are hereby denied. 8. Admitted. It is admitted that on or about January 16,2001 PHB entered into a Medical Office Sublease Agreement ("Sublease") with Defendant Sullivan LLC to which Plaintiff Williams consented. 9. Denied. The Sublease, attached to Plaintiffs Complaint as Exhibit "B", is a legal document that speaks for itself. Therefore, any interpretations or summarizations as to the contents of the Sublease are hereby denied. 10. Denied. The Sublease, attached to Plaintiffs Complaint as Exhibit "B", is a legal document that speaks for itself. Therefore, any interpretations or summarizations as to the contents of the Sublease are hereby denied. 11. Denied. The Sublease, attached to Plaintiffs Complaint as Exhibit "B", is a legal document that speaks for itself. Therefore, any interpretations or summarizations as to the contents of the Sublease are hereby denied. 12. Denied. The Sublease, attached to Plaintiffs Complaint as Exhibit "B", is a legal document that speaks for itself. Therefore, any interpretations or summarizations as to the contents of the Sublease are hereby denied. 13. Denied. The Sublease, attached to Plaintiffs Complaint as Exhibit "B", is a legal document that speaks for itself. Therefore, any interpretations or summarizations as to the contents of the Sublease are hereby denied. 14. Denied. The Sublease, attached to Plaintiffs Complaint as Exhibit "B", is a legal document that speaks for itself. Therefore, any interpretations or summarizations as to the contents of the Sublease are hereby denied. 15. Denied. The Sublease, attached to Plaintiffs Complaint as Exhibit "B", is a legal document that speaks for itself. Therefore, any interpretations or summarizations as to the contents of the Sublease are hereby denied. 16. Admitted in part and denied in part. It is admitted that the Defendants had been advised, through Plaintiffs counsel, that PHB previously filed for bankruptcy. To the extent that Defendants were not and have not been served with any papers from the Bankruptcy Court regarding such filing, the averment is hereby denied. 17. Denied. Section 362 of the Bankruptcy Code is a provision of a Federal Statute, a federal law, and therefore speaks for itself. Any summarization or interpretation of the meaning of this particular provision of the Bankruptcy Code is therefore specifically denied. 18. Admitted in part and denied in part. After reasonable investigation, Defendants are without knowledge or sufficient information to form a belief as to that portion of the averment which states that PHB has failed to make any rent payments to Williams for the month of July, 2001 and thereafter. Therefore, that portion of the averment is specifically denied. It is admitted that Sullivan LLC has not made rent payments to Williams. By way of further answer, the sublease was entered into between PHB and Sullivan LLC. As such, Sullivan LLC was not required to make rental payments to Williams. 19. Admitted in part and denied in part. It is admitted that counsel for Sullivan LLC advised PHB of its default of the Sublease, as contractually required under the provisions of the Sublease. Additionally, the letter referred to in paragraph 19 of Plaintiffs Complaint was attached as Exhibit "c" to Plaintiff s Complaint and speaks for itself. As such, any interpretation or summarization of the letter referred to in paragraph 19 of the Complaint is therefore specifically denied. By way of further answer, the letter of August 9, 2001 from counsel for Sullivan LLC was also served upon Williams by and through their counsel. 20. Admitted in part and denied in part. It is admitted that counsel for Sullivan LLC advised PHB that the Sublease was ended and void in accordance with the terms of the Sublease. Additionally, the letter referred to in paragraph 20 of Plaintiffs Complaint was attached as Exhibit "D" to Plaintiffs Complaint and, as such, speaks for itself. Any interpretation or II " II summarization of the letter referred to in paragraph 20 of the Complaint is therefore specifically denied. By way of further answer, the letter of August 9, 2001 from counsel for Sullivan LLC was also served upon Williams by and through their counsel. 21. Admitted in part and denied in part. It is admitted that the document attached as Exhibit "E" to the Plaintiff s Complaint is a Court Order from the Bankruptcy Court for the Northern District of Texas, Fort Worth Division which authorizes debtor to reject certain unexpired leases including the Prime Lease between PHB and Williams. To the extent that counsel for Plaintiff advised counsel for Defendants that such an Order was filed, the allegation is admitted. To the extent, however, that the Defendants were not served with a copy of the October 4th Order from the Bankruptcy Court as they were not parties to the bankruptcy proceedings, the averment is hereby denied. It is further denied that the Prime Lease is the lease at issue in this matter. By way of further answer, it is the Sublease between PHB and Sullivan LLC that is the only lease entered into by, or which obligates, any ofthe Defendants. 22. Admitted in part and denied in part. It is admitted that the October 15, 2001 letter from counsel for Williams to counsel for Sullivan LLC was attached to the Plaintiffs Complaint as Exhibit "F." Any interpretations, conclusions or summaries drawn with regard to the contents of that letter are hereby specifically denied as the letter is a document that speaks for itself. Further, any interpretation, conclusions or summarization as to the Bankruptcy Code, a Federal Statute, contained within the letter are also hereby specifically denied as conclusions of law. The provisions of the Bankruptcy Code regarding automatic stays are a matter of Federal law, which speak for themselves. 23. Admitted in part and denied in part. It is admitted that counsel for Williams sent a letter dated October 17, 2001 to counsel for Sullivan LLC. A true and correct copy of the 'T October 17, 2001 letter is attached hereto and made part of this document as Exhibit "A." The document speaks for itself and therefore, any interpretation or summarization with regards to the contents of that letter is hereby specifically denied. Further, that portion of the averment that states that Williams assumed the position of Sublandlord under the Sublease is a conclusion of law and, therefore, that portion of the averment is also specifically denied. 24. Admitted in part and denied in part. It is admitted that Exhibit "G" to Plaintiff's Complaint is a letter dated October 17,2001 from Williams to counsel for Sullivan LLC. As the content of the letter speaks for itself, any summarization or conclusions with regard to the content of that letter are hereby denied. 25. Admitted in part and denied in part. It is admitted that the document attached as Exhibit "R" to the Plaintiffs Complaint, a Court Order from the Bankruptcy Court for the Northern District of Texas, Fort Worth Division, authorizes debtor to reject certain unexpired leases including the Prime Lease between PHB and Williams. To the extent the Defendants were advised by counsel for Plaintiff that such an Order was filed, the allegation is admitted. To the extent, however, that Defendants were not served with a copy of the October 16th Order from the Bankruptcy Court, as they were not parties to the bankruptcy proceedings, the averment is hereby denied. COUNT I Williams Associates v. John M. Sullivan. LLC Breach of Contract 26. Defendants hereby incorporate by reference the responsive averments contained in paragraphs 1-25, supra, as if fully stated herein. II II Ii ., ! 27. Admitted. It is admitted that Sullivan LLC ceased to make rental payments after July of2001. By way of further answer, at that point, PHB was in default of the Sublease and, therefore, Sullivan LLC ceased all further rent payments. In addition to the default, PHB refused to reimburse Sullivan LLC for expenditures it was making on a weekly basis for the repair of water and sewer systems on the leased premises. As a result of, and in addition to, the default, the rental payments were withheld as a setoff to the mounting repair bills. 28. Admitted in part and denied in part. It is admitted that on or about October 29, 2001 Sullivan LLC left the leased premises and began practicing at its current location- 1001 South Market Street, Suite B, Mechanicsburg, PA 17055. The remaining averments contained within paragraph 28 of Plaintiffs Complaint constitute conclusions of law to which no responsive pleading is required and are, therefore, denied. By way of further answer, it is denied that Sullivan LLC abandoned the leased premises. To the contrary, PHB was in default under the terms of the Sublease. After notice of its default, both PHB and Williams failed to cure the default. Only after such notice, and the requisite time period was allowed to elapse following such notice, Sullivan left the leased premises as permitted under the contractual provisions of the Sublease. 29. Denied. The averments contained in paragraph 29 of Plaintiffs Complaint constitute conclusions of law to which no responsive pleading is required and are, therefore, denied. Additionally, the Sublease is attached to the Plaintiffs Complaint as Exhibit "B" and is a legal document that speaks for itself. Therefore, any summarizations, conclusions or interpretations of the contents of that document are hereby specifically denied. By way of further answer, it is denied that Sullivan LLC defaulted under the terms of the Sublease. It is further denied that Sullivan LLC abandoned the Leased Premises. Moreover, PHB defaulted under the terms of the Sublease, was notified of such (as was Plaintiff) and allowed an opportunity to cure such default in accordance with the terms of the Sublease before Sullivan LLC was constructively evicted from the premises. 30. Denied. The averments contained in paragraph 30 of Plaintiffs Complaint constitute conclusions oflaw to which no responsive pleading is required and are, therefore, denied. Additionally, the Sublease, attached to the Plaintiffs Complaint as Exhibit "B", is a legal document that speaks for itself and, therefore, any conclusions or summarizations as to the contents of the Sublease are denied. By way of further answer, it is denied that Sullivan LLC defaulted under the terms of the Sublease. To the contrary, PHB was in default under the terms of the Sublease. After notice of its default (also served upon Plaintiff), both PHB and Williams failed to cure the default. Only after such notice was provided and the requisite time period was allowed to elapse, was Sullivan forced to leave the leased premises - in effect, Sullivan was constructively evicted. 31. Denied. The averments contained in paragraph 31 of Plaintiffs Complaint constitute conclusions of law to which no responsive pleading is required and are, therefore, specifically denied. It is denied that Sullivan LLC defaulted under the terms of the Sublease. By way of further answer, it is denied that Williams has suffered damages as a result of any action or inaction by Sullivan LLC. Moreover, it is denied that Williams suffered damages in the amount of $180,621.21 by the actions or inactions of any party as the damages were calculated through the expiration of the lease, or March 31, 2004, and the premises in question was sold on or about July 30, 2002. t. II COUNT II Williams Associates v. John M. Sullivan. M.D. & Associates. LLC Unjust Enrichment - (In the Alternative) 32. Defendants hereby incorporate by reference the responsive averments contained in paragraphs 1-31, supra, as if fully stated herein. 33. Denied. The averment contained in paragraph 33 of Plaintiffs Complaint is a conclusion oflaw to which no responsive pleading is required. Therefore, the averment is denied. By way of further answer, under the facts as alleged in paragraph 23 of Plaintiffs Complaint, Williams did not purport to assume the Sublease until October 17, 2001. See Complaint, , 23. Additionally, and again under the facts as alleged in Plaintiffs Complaint, the Bankruptcy Court for the Northern District of Texas did not approve Plaintiffs assumption of PHB's claims under the Lease or Sublease until it's Order dated November 16,2001 was issued. See Complaint, , 25. By way of further answer, PHB had defaulted on the Sublease and both PHB and Williams had failed to cure such default. As a result, Sullivan LLC incurred damages. Finally, it is denied that the bankruptcy proceedings applied to the Sublease as Sullivan LLC was not a creditor ofPHB and, further, that Sullivan LLC declared a default under the contractual terms of the Sublease, but did not seek to institute an action against PHB or otherwise seek a money award. 34. Denied. The averment contained in paragraph 34 of Plaintiffs Complaint is a conclusion of law to which no responsive pleading is required. Therefore, the averment is denied. 35. Denied. The averment that $14.50 per square foot, or $5,204.29 per month, is a "just and reasonable charge of the leased premises during the time period in which they were occupied..." is a conclusion of law to which no responsive pleading is required. Therefore, the averment contained in paragraph 35 of the Plaintiff's Complaint is hereby denied. By way of further answer, it is denied that the fair market rental value for a premise with severe water and sewer problems is $14.50 per square foot, or a monthly lease payment equal to $5,204.29. 36. Denied. The averment that Sullivan LLC has become enriched by leasing the premises from July through October 2001 is a conclusion of law to which no responsive pleading is required and is, therefore, denied. By way of further answer, it is denied that, if found to be so enriched, the amount of such enrichment would be equal to $15,612.87. COUNT III Williams Associates v. Cardinal Therapies. P.c. Trespass 37. Defendants hereby incorporate by reference the responsive averments contained in paragraphs 1-36, supra, as if fully stated herein. 38. Denied. It is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiff's Complaint. It is further denied that Cardinal Therapies occupied an unauthorized portion of the premises from February 1,2001 through October 29,2001. 39. Denied. It is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. By way of further answer, it is denied that Cardinal Therapies used an unauthorized portion of the premises. It is further denied that Cardinal Therapies conducted any business on an unauthorized portion of the premises. 40. Denied. It is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiff's Complaint. By way of further answer, it is denied that Cardinal Therapies, either with or without Williams' knowledge, used an unauthorized portion of the premises. 41. Admitted in part and denied in part. It is admitted that Cardinal Therapies provided no compensation to Williams. It is hereby denied that Cardinal Therapies had any obligation to pay compensation to Williams. It is further denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiff's Complaint. By way of further answer, it is denied that Cardinal Therapies used, lawfully or unlawfully, an unauthorized portion of the premises. 42. Denied. It is denied that there was any part of the premises designated as ''unauthorized''. See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiff's Complaint. By way of further answer, it is denied that Cardinal Therapies used an unauthorized portion of the premises. It is further denied that Cardinal Therapies made any alterations to an unauthorized portion of the premises. 43. Denied. The averments contained in paragraph 43 of the Plaintiff's Complaint are conclusions oflaw to which no responsive pleading is required. Therefore, the averments are denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiff's Complaint. It is denied that Cardinal Therapies occupied an unauthorized portion of the premises. It is, therefore, further denied that Cardinal Therapies could have done so intentionally. 'I 44. Denied. The averments contained in paragraph 44 of Plaintiffs Complaint constitute conclusions of law to which no responsive pleading is required and are, therefore, denied. By way of further answer, it is denied that there was any part of the premises designated as ''unauthorized''. See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. As such, it is denied that Cardinal Therapies occupied an unauthorized portion of the premises. Additionally, it is denied that Cardinal Therapies caused Plaintiff to incur any damages as a result of unpaid rent. 45. Denied. The allegations contained in paragraph 45 of Plaintiffs Complaint constitute conclusions of law to which no responsive pleadings are required and are, therefore, denied. Further, after reasonable investigation, Defendants are without knowledge or information sufficient to form a belief as to the truth of the costs of repairs for the restoration of the "unauthorized premises." Therefore, this portion of the averment is specifically denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. As such, it is denied that Cardinal Therapies occupied an unauthorized portion of the premises. It is further denied that Cardinal Therapies in any way altered the premises or caused Williams to incur damages as a result. 46. Denied. The averment contained in paragraph 46 of Plaintiffs Complaint constitutes a conclusion oflaw to which no responsive pleading is required. Therefore, the averment is denied. 47. Denied. The averment contained in paragraph 47 of Plaintiffs Complaint constitutes a conclusion oflaw to which no responsive pleading is required. Therefore, the averment is denied. COUNT IV Williams Associates v. John M. Sullivan Trespass 48. Defendants hereby incorporate by reference the responsive averments contained in paragraphs 1-47, supra, as if fully stated herein. 49. Denied. It is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. By way of further answer, it is denied that Sullivan occupied an unauthorized portion of the leased premises from February 1,2001 through October 29,2001. 50. Denied. It is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. By way of further answer, it is denied that Sullivan used an unauthorized portion of the premises. As such, it denied that Sullivan conducted any business on an unauthorized portion of the premises. 51. Denied. It is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. By way of further answer, it is denied that Sullivan used an unauthorized portion of the premises. 52. Admitted in part and denied in part. It is admitted that Sullivan provided no compensation to Williams. It is denied, however, that Sullivan had any obligation to provide compensation to Williams. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, II " II Exhibit "B" to Plaintiffs Complaint. It is denied that Sullivan used an unauthorized portion of the premises. 53. Denied. It is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. By way of further answer, it is denied that Sullivan used an unauthorized portion of the premises. It is further denied that Sullivan made any alterations to an unauthorized portion of the premises. 54. Denied. The averments contained in paragraph 54 ofthe Plaintiffs Complaint constitute conclusions oflaw to which no responsive pleadings are required. Therefore, the averments are denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. Additionally, it is denied that Sullivan occupied an unauthorized portion of the premises. It is, therefore, denied that Sullivan could have occupied some unauthorized portion of the premises intentionally. 55. Denied. The averments contained in paragraph 55 of Plaintiffs Complaint constitute conclusions of law to which no responsive pleadings are required and are, therefore, denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. Additionally, it is denied that Sullivan used an unauthorized portion of the premises. As such, it is denied that Sullivan owed rent to Plaintiff or caused Plaintiff to incur any damages as a result of unpaid rent. 56. Denied. The averments contained in paragraph 56 of Plaintiffs Complaint constitute conclusions oflaw to which no responsive pleadings are required and are, therefore, denied. Additionally, after reasonable investigation, Defendants are without knowledge or information sufficient to form a belief as to the truth of the costs of repairs for the restoration of the "unauthorized premises." Therefore, this portion of the averment is specifically denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. Additionally, it is denied that Sullivan used an unauthorized portion of the premises. It is further denied that Sullivan altered an unauthorized portion ofthe premises in any way. As such, it is denied that Sullivan caused Williams to incur any damages. 57. Denied. The averment contained in paragraph 57 of Plaintiffs Complaint constitutes a conclusion oflaw to which no responsive pleading is required. Therefore, the averment is denied. 58. Denied. The averment contained in paragraph 58 of the Complaint is a conclusion of law to which no responsive pleading is required. Therefore, the averment is denied. 59. Denied. The averment contained in paragraph 59 of Plaintiffs Complaint constitutes a conclusion of law to which no responsive pleading is required. Therefore, the averment is denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. As such, it is denied that Sullivan trespassed, intentional or otherwise, upon an unauthorized portion of the premises. II 'I 11 'II II I, COUNT V Williams Associates v. Cardinal Therapies. P.e. Unjust Enrichment 60. Defendants hereby incorporate by reference the responsive averments contained in paragraphs 1-59, supra, as if fully stated herein. 61. Denied. The averment contained in paragraph 61 of Plaintiffs Complaint is a conclusion oflaw to which no responsive pleading is required. Therefore, the averment is denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. It is further denied that Cardinal Therapies occupied an unauthorized portion of the premises. Moreover, under the facts as asserted in paragraph 61 of Plaintiffs Complaint, the Plaintiff did not purport to assume the Sublease until October 17, 2001. Additionally, and again under the facts as asserted in Plaintiffs Complaint, the Bankruptcy Court for the Northern District of Texas did not approve Plaintiffs assumption ofPHB's claims under the Lease or Sublease until its Order dated November 16, 2001 was issued. See Complaint, ~ 25. Finally, it is denied that the bankruptcy proceedings applied to the Sublease as Sullivan LLC was not a creditor ofPHB and, further, that Sullivan LLC declared a default under the contractual terms of the Sublease, but did not seek to institute an action against PHB or otherwise seek a money award. 62. Denied. The averment contained in paragraph 62 of Plaintiffs Complaint is a conclusion of law to which no responsive pleading is required. Therefore, the averment is denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. It is denied that Cardinal Therapies occupied an unauthorized portion of the leased premises. 63. Denied. The averment contained in paragraph 63 of Plaintiffs Complaint constitutes a conclusion of law to which no responsive pleading is required and is, therefore, denied. By way of further answer, it is denied that the fair market rental value for a premise with severe water and sewer problems is $14.50 per square foot, or equal to a lease payment of $5,204.29. 64. Denied. The averments contained in paragraph 64 of Plaintiffs Complaint constitute conclusions oflaw to which no responsive pleading is required. Therefore, the averments are denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiffs Complaint. Moreover, it is denied that Cardinal Therapies in any way altered an unauthorized portion of the premises. 65. Denied. The averment contained in paragraph 65 constitutes a conclusion oflaw to which no responsive pleading is required and is, therefore, denied. By way of further answer, it is denied, if this honorable Court should find Cardinal Therapies to be so enriched, that the amount of such enrichment would be equal to $2,500.00. 66. Denied. The averment contained in paragraph 66 of Plaintiffs Complaint constitutes a conclusion oflaw to which no responsive pleading is required. Therefore, the averment is denied. COUNT VI Williams Associates v. John M. Sullivan Unjust Enrichment 67. Defendants hereby incorporate by reference the responsive averments contained in paragraphs 1-66, supra, as if fully stated herein. 68. Denied. The averment contained in paragraph 68 of Plaintiffs Complaint is a conclusion of law to which no responsive pleading is required. Therefore, the averment is denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiff's Complaint. Moreover, it is denied that Sullivan occupied the "unauthorized premises." Under the facts as asserted in paragraph 23 of Plaintiff's Complaint, the Plaintiff did not purport to assume the Sublease until October 17,2001. Further, and again under the facts as asserted in Plaintiff's Complaint, the Bankruptcy Court for the Northern District of Texas did not approve Plaintiff's assumption ofPHB's claims under the Lease or Sublease until its Order dated November 16, 2001 was issued. See Complaint, ~ 25. Finally, it is denied that the bankruptcy proceedings applied to the Sublease as Sullivan LLC was not a creditor ofPHB and, further, that Sullivan LLC declared a default under the contractual terms of the Sublease, but did not seek to institute an action against PHB or otherwise seek a money award. 69. Denied. The averment contained in paragraph 69 of Plaintiffs Complaint is a conclusion oflaw to which no responsive pleading is required. Therefore, the averment is denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiff's Complaint. Moreover, it is denied that Sullivan occupied the "unauthorized 11 . .11 , premises." Further, Sullivan had no duty or obligation to pay a fair market value for the ''unauthorized premises." 70. Denied. The averments contained in paragraph 70 of the Complaint constitute conclusions of law to which no responsive pleading is required and are, therefore, denied. It is further denied that the fair market rental value for a premise with severe water and sewer deficiencies is $15.00 per square foot, or equal to a lease payment of $4,500.00. 71. Denied. The averments contained in paragraph 71 of Plaintiff's Complaint contain conclusions of law to which no responsive pleading is required. Therefore, the averments are denied. By way of further answer, it is denied that there was any part of the premises designated as "unauthorized". See Drawing attached as "Exhibit B" to the Sublease, Exhibit "B" to Plaintiff's Complaint. Moreover, it is denied that Sullivan in any way altered an unauthorized portion of the premises. 72. Denied. The averments contained in paragraph 72 of Plaintiff's Complaint constitute conclusions oflaw to which no responsive pleading is required and are, therefore, denied. By way of further answer, it is denied that, should this honorable Court find that Sullivan was enriched, the amount of such enrichment would be equal to $2,500.00. 73. Denied. The averment contained in paragraph 73 of Plaintiffs Complaint is a conclusion oflaw to which no responsive pleading is required. Therefore, the averment is denied. NEW MATTER 74. Defendants hereby incorporate by reference the responsive averments contained in paragraphs 1-73, supra, as if fully stated herein. II 75. Plaintiff Williams was not a party to the Sublease and, therefore, has no legal standing to state a claim against the Defendants as a matter oflaw. The Sub-Landlord was in default, Notice of Default was sent to Sub-Landlord and Prime Landlord, and the default went uncured for the 30-day period specified in the Sublease. As such, and due to Sub-Landlord's default, the Sublease was terminated and considered null and void prior to the date Plaintiff purported to assume the Sublease. 76. Plaintiff Williams expressly acknowledged that PHB as Sub-Landlord was in default of the Sublease Agreement for ".. . failure to provide sewer services as 'are reasonably necessary for medical office practice' (Section 5 of the Sublease)." See August 8, 2001 letter from Michael L. Solomon, Esquire, a true and correct copy which is attached hereto and made part of this document as Exhibit "B". By acknowledging default by the Sub-Landlord ofthe Sublease, Prime Landlord has waived any claim of default alleged to have subsequently arisen against the sub-tenant. 77. Plaintiff Williams, by and through counsel Michael L. Solomon, Esquire, orally advised Defendant Sullivan, LLC to cease all lease payments made to the Sub-Landlord and, therefore, has waived any claim against the Sub-Landlord for failure to make such lease payments. 78. Plaintiff Williams, by and through counsel Michael L. Solomon, Esquire, orally advised Defendant Sullivan, LLC to cease all lease payments and, therefore, consented to Defendant's actions of withholding such lease payments from the Sub-Landlord. By consenting to the Sub-Tenant's actions, Plaintiff Williams is now barred from bringing the present action to recover such lease payments. IT 79. Plaintiff Williams, by and through counsel Michael L. Solomon, Esquire, expressly acknowledged Sub-Landlord's default in the Sublease and orally advised the Sub- Tenant to cease all lease payments to the Sub-Landlord. Sub-Tenant justifiably relied upon the instruction provided by the Plaintiff, the Prime Landlord. As such, Plaintiff Williams is barred from bringing the present action against the Sub-Tenant, claiming default by the Sub-Tenant for failure to pay such lease payments. 80. Plaintiff Williams failed to state a claim against Cardinal Therapies on all counts as a matter oflaw. 81. Plaintiff Williams failed to state a claim against John Sullivan, in his individual capacity, on all counts as a matter of law. 82. Defendant Sullivan, LLC properly provided notice of default to the Sub-Landlord and Prime Landlord, as required under the terms of the Sublease, and allowed for the 30-day period for curing such default before acknowledging default by the Sub-Landlord and Prime Landlord and declaring the Sublease terminated, null and void. Therefore, Defendant Sullivan, LLC, the Sub-Tenant, did not default on the Sublease. As such, Plaintiff Williams has no legally cognizable damages under any count as a matter oflaw. 83. Plaintiff Williams is unable to claim damages from on or about July 30, 2002 through the expiration of the Lease, or in March of 2004, as the premises at issue was sold by Plaintiff Williams to a third party on or about July 30, 2002. 84. Defendants' actions and conduct in this matter were lawful, proper, privileged, and justifiable. 85. Defendant's actions and conduct in this matter were not illegally intentional. II . .1 86. The actions or inactions ofPHB, as the Sub-Landlord, and Plaintiff Williams, as Prime Landlord, amounted to a substantial failure of consideration with regard to the Sublease. The purpose of the Sublease was for the operation of a medical office, and is titled as such. By failing to cure the sewer problems affecting the leased premises, the premises were not suitable for the operation of a medical office. 87. The actions or inactions of the Sub-Landlord, PHB, and the Plaintiff, as Prime Landlord, resulted in substantial failure of consideration with regard to the Sublease. Under the terms of the Sublease, Sub-Landlord was to provide utilities such as water and sewer to the leased premises. Sub-Landlord's promise to provide such utilities was a significant portion of the consideration for entering into the Lease Agreement. By failing to provide these utilities, the premise was not suitable for business operations. Further, there no longer existed the significant portion of consideration for entering into the Sublease and, therefore, Sub-Tenant was justified in retaining lease payments during the periods of time in which such utilities were not provided. By the terms of the Sublease, either the Prime Landlord, the Plaintiff in this matter, or the Sub- Landlord could have cured such deficiencies and thus the default. The failure of either to cure resulted in a default of the Sublease by both the Prime Landlord and the Sub-Landlord. 88. Under the terms of the Sublease, Sub-Landlord was to provide utilities such as water and sewer for the leased premises. The provision of such utilities was a significant portion ofthe consideration for the Sub-Tenant entering into the Sublease Agreement. By failing to so provide these utilities and by further failing to cure the default with regard to the service ofthese utilities, Defendant Sullivan, LLC was forced to incur numerous and expensive service and repair bills. As a result of both this breach of contract and failure of consideration, Defendant 11 'I .11 'I Sullivan, LLC was justified in withholding lease payments as a setoff for the numerous repair and service bills incurred. 89. Defendant Sullivan, LLC properly provided notice of default to the Sub-Landlord and Prime Landlord, as required under the contractual provisions of the Sublease, and allowed for the 30-day period for curing such default before acknowledging default by the Sub-Landlord and Prime Landlord and declaring the Sublease terminated, null and void. Sullivan LLC, in declaring the default and subsequent termination of the sublease, did not".. . act to obtain possession of property of the estate or property from the estate or to exercise control over property of the estate." See 11 U.S.C. * 362(a)(3). Nor did Sullivan LLC "..act to collect, assess, or recover a claim against a debtor..." See 11 U.S.C. * 362(a)(6). Further, Sullivan LLC was not a creditor of the estate. As such, the Automatic Stay provisions relied upon by Williams in the Complaint were not applicable to Sullivan LLC. PHB and Williams were, thus, in default and Sullivan LLC satisfied the contractual requirements for terminating the Sublease. DEFENDANTS' COUNTERCLAIM AGAINST PLAINTIFF WILLIAMS ASSOCIATES BREACH OF CONTRACT 90. Defendants hereby incorporate the responsive averments contained in paragraphs 1 through 89 of this Answer with New Matter and Counterclaim as if fully stated herein. 91. As stated above, Plaintiff Williams entered into a Lease Agreement with PHB, a true and correct copy of which is attached to Plaintiff's Complaint as Exhibit A. 'I d , ,II 92. PHB, with Plaintiffs consent, entered into a Sublease Agreement with Defendant Sullivan, LLC for the same leased premises, a true and correct copy of which is attached to Plaintiff s Complaint as Exhibit B. 93. Pursuant to the terms of the Sublease, PHB expressly agreed to provide "...water and sewer...as such utilities are reasonable necessary for a medical office practice..." as part of the consideration for Defendant Sullivan, LLC entering into the Sublease. See Complaint Exhibit "B", , 5. 94. PHB failed to provide water and sewer utilities ''reasonably necessary for a medical office practice". See Complaint Exhibit "B",' 5. 95. In accordance with paragraph 18 of the Sublease, Defendant Sullivan, LLC, as Sub-Tenant, provided notice of default and allowed a 30-day period for either the Prime Landlord, the Plaintiff in this matter, or PHB as Sub-Landlord to cure such default. See Notice, a true and correct copy of which is attached hereto as Exhibit "C". 96. Neither the Plaintiff as Prime Landlord, nor PHB as Sub-Landlord cured, nor attempted to cure, said default. 97. As sewer services suitable for running a medical office were not provided, PHB and Plaintiff failed to provide a significant portion of the consideration offered for Sullivan LLC to enter into the Sublease. 98. Further, due to the condition of the sewer system at the leased premises, the leased premises were not suitable for the business purpose for which they were leased - a medical office. Defendant Sullivan LLC was, thus, constructively evicted from the leased premIses. 99. As a result, Sullivan LLC suffered damages in excess of$35,000 plus attorneys' fees and costs. These damages consist of moving expenses, two (2) days of staff labor, two (2) days oflost revenue due to the move, lost revenue due to the uninhabitable condition of the leased premises, lost future revenue due to the reduced lease space obtained upon constructive eviction, and water and sewer service and repair bills incurred at the expense of Sullivan LLC. WHEREFORE, Sullivan, LLC demands that judgment be entered in its favor and against Williams for an amount in excess of $35,000, plus Attorneys' fees and costs. Respectfully Submitted, SMIGEL, ANDERSON & SACKS, LLP Date: "/1/01- ~ M. eRoy Smigel .D. #09617 usan M. Zeamer J.D. #82023 4431 North Front Street, 3rd Floor Harrisburg, P A 17110-1709 (717) 234-2401 Attorneys for Defendants !I , J WILLIAMS ASSOCIATES, PLAINTIFF v. JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDTINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS TIN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA No. 01-6201 CIVIL TERM CIVIL ACTION - LAW CERTIFICATE OF SERVICE I, Susan M. Zeamer, Esquire, attorney for the Defendants in the above-captioned matter, do hereby certify that I served a true and correct copy of the Defendants' Answer with New Matter and Counterclaim on counsel for the Plaintiff by depositing the same in the U.S. Mail, on this l'jtf>..lay of ~, 2002, postage prepaid for first class mail, addressed as follows: MARKIAN R. SLOBODIAN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG,PA 17108-1967 Date: 1/lf (e7- f I MICHAEL L. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISBURG,PA 17101 SMIGEL, ANDERSON & SACKS, LLP 0-__rv... oy Smigel 1. . #09617 Susan M. Zeamer I.D. #82023 4431 North Front Street, 3rd Floor Harrisburg, PA 17110-1709 (717) 234-2401 Attorneys for Defendants Exhibit A ~'-~'-~.._.";;"...:,,,,,._-^.,..._.- MICHAEL L. SOLOMON, ESJ:;;I. THE LOCUST COURT BUILDING 21 2 LOCUST STREET, SUITE SOD HARRISBURG, PA 1 71 0 1 717-255-7600 717-236-8278 (..AX) Mec LCMDN@TTANLAWaCOM October 17,2001 LeRoy Smigel SMIGEL, ANDERSON & SACKS 2917 N. Front Street Harrisburg, PA 17110-1260 NOTiCE OF ASSUMPTION OF SUBLEASE Dear Lee: Consider this letter confirmation of the information provided in my October 15 letter to you. Specifically, I am now informed that the Bankruptcy Court issued an Order granting PHB Management's Rejection Motion on October 4, 2001. The Order encompassed the "Overlease" for the premises occupied by Dr. Sullivan. Inasmuch as a lease rejection by a debtor is tantamount to a condition of breach, we are now at the crossroads over which you prematurely tried to steer in your August notice of default. Properly juxtaposed, this is also the appropriate time for Williams Associates to exercise its assumption of the Sublease as it is permitted to do under Section 16 of the Sublease. In so doing, Williams Associates will now commence repair of the faulty plumbing line at the premises. Kindly advise as to any dates or times when it would be inconvenient to your client to have contractors, adjusters, estimators or the like visit the premises. We will not undertake any significant repairs without Dr. Sullivan's knowledge and permission. Meanwhile, my client is aware of a letter being distributed by Dr. Sullivan to patients and other parties in interest advising of his pending relocation, and further insinuating or directly attributing the departure to actions by the landlord. To the extent that any misstatements of fact are being leveled against Williams Associates, I encourage you to lend appropriate advice to your client. Given the illegal nature of the announced termination of sublease, it occurs to me that Dr. Sullivan, instead, ought to be reconsidering his decision to relocate. I anxiously await your report. cc: Williams Associates Exhibit B ....._.,--,~.-~.---_._-. . .. . " MICHAEL L. SOLClMON, J:;!'iltl. TH~ LOCUST COURT BUILDING :3 1 Z LOCUST 5TRe:e:T, SiUITE 500 J-tARRISSURG, PA 17101 ? 1 '1_;255-'7600 '71 '7_236-83'78 IP'AXI Io'ISl;l\"OIo'lDN@TTANLAW.COIo'l August 8. 2001 Valerie Faden, ESquire SMIGEL. ANDERSON & SACKS 2917 N. Front Street Harrisburg, PA 17110 Re: PHS Management Bankruptcy Dear Valerie: VIA FACSIM1LE It Is a pleasure to make your acquaintanCe, end I look fOlward to worldnQ wltn yoU to resol~e issues arising from tns p~B Management bankrUPtcy In a ",anner mutually satisfactory to our cltents, TodaY. I attact1 copies of tns feW bankrUplC\f- reiated documents received bY WilliamS Associates, my client and the prime landlord of your client's space. Regarding the bankrUplC\f. I nave e prellmlnery understanding from p~B'. counsel tnaltheY will reject our leese, as Is lt1eir rigl1lln bankrUplC\f. AcCOrdinglY. it seems in our best Interest to eJ<PSdrte tnl. action so tnat our clients can obtaIn a direct relationsnlP wllt1eacn otner. It Is "'Y Intention to declare p~B in default for non;>SY"'ent of rent. and tnen move to ass"",,, tl1e Sublease as permitted In Section 16 of the sublease. you maY si",ilarlY want to declare a default of tne Sublease for failure to provide ",,,.r services as "are reasonablY "ecessllfY for a medical office prectice" (section 5 of lt1e Sublease). DoIng so will undOUbtedlY accelerate p~B'S interest in rejecting the lease arrangements. ~ t~ -- - ----------------- '--...._""~ , , - ~ . ,. . . (. I MICHAEL L. SOLOMON, ES~. THE LOCUST COURT eUILDING 21 :2 LoCUST 5TRE:E:1", SUITE soe HAFtRlliIElURG, PA 1 71 C 1 71 7-:2SS-7SDD 71 7-235-&2'7B IF'Axl MSgLgMON@TTANLAW.CDM August 8, 2001 Valerie Faden, Esquire SMIGEL, ANDERSON & SACKS 2917 N. Front Street Harrisburg, PA 17110 VIA FACSIMILE Re: PHB Management Bankruptcy Dear Valerie: It is a pleasure to make your acquaintance, and I look forward to working with you to resolve issues arising from the PHS Management bankruptcy in a manner mutually satisfactory to our clients. Today, I attach copies of the few bankruptcy- related documents received by Williams Associates, my client and the prime landlord of your client's space. Regarding the bankruptcy, I have a preliminary understanding from PHS's counsel that they will reject our lease, as is their right in bankruptcy. Accordingly, it seems in our best interest to expedite this action so that our clients can obtain a direct relationship with each other. It is my intention to declare PHS in default for non-payment of rent, and then move to assume the Sublease as permitted in Section 16 of the Sublease. You may similarly want to declare a default of the Sublease for failure to provide sewer services as "are reasonably necessary for a medical office practice" (Section 5 of the Sublease). Doing so will undoubtedly accelerate PHB's interest in rejecting the lease arrangements. ,". . j ~ I . Valerie Faden, Esquire August 8,2001 Page 2 After you have an opportunity to review this letter and the attached documents, please call to discuss your position. Thank you. ~c~- Michael L. Solomon cc; Williams Associates Attachments Exhibit C . . .. 6> .. .. . SMIGEL, ANDERSON & SACKSLLP LEROY SMIGEL, ESQUIRE PHONE: (717) 234-2401 TOLL FREE: 1-800-822-9767 ATI'ORNEYS AT LAW FACSIMILE (717) 234-3611 DlAIL: Ismigel@sasllp.com www.sasllp.com File No. 5873-1-2 August 9, 2001 Charles McQueary, CEO PHB Management Co., Inc. Fort Worth, TX 76102 Dear Mr. McQueary: This letter is to inform you that you are in default with respect to the Medical Office Sublease executed on January 16,2001 with John M. Sullivan, M.D. & Associates, L.L.C., of .. Harrisburg, Pennsylvania. The water and sewage problems persist at the leased premises, which you are required to maintain under Section 5 of the Sublease, stating the Sublandlord shall provide utilities that are reasonably necessary to conduct a medical office practice, Your continued failure to pay for the necessary maintenance at the leased premises renders it non-tenantable in its current condition. Please contact us immediately to inform us of your intentions with regard to your obligations under the Medical Office Sublease. LRS:VJF:vlf cc: Michael L. Solomon, Esquire John M. Sullivan, M.D. 2917 North Front Street. Harrisburl!. Pennsvlvania 17110-1260 A PENNSYLVANIA LIMITED LIABILITY PARTNERSHIP . (') ... C) c;:,; _.c;, ., -, -, r~ ) ,.. C \ .) >~ - c' --."' .,.::- , -j c..;. -, WILLIAMS ASSOCIATES, Plaintiff : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, P A v. : CIVIL ACTION - LAW JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.c. & JOHN M. SULLIV AN, : NO. 01-6201- Civil Term Defendants PLAINTIFF'S ANSWER TO NEW MATTER & COUNTERCLAIM NEW MATTER TO COUNTERCLAIM NOW COMES, Plaintiff, Williams Associates, by its counsel, The Law Offices of Markian R. Slobodian, and makes the following Answer to Defendant's New Matter and Counterclaim in the above-referenced case: ANSWER TO NEW MATTER 74. Plaintiff incorporates by reference the allegations contained in Paragraph 1 through 73 of its Complaint. 75. Denied. This paragraph states a series of conclusions of law to which no answers are required. To the extent answers may be required, Plaintiff denies the allegation that it was not a party to the Sublease. Plaintiff further denies the allegation that it has no legal standing to state a claim against the Defendants as a matter of law. After reasonable investigation, Plaintiff lacks sufficient information to form a belief as to the accuracy of the allegation that the Sub- Landlord was in default. Accordingly, Plaintiff denies this allegation and demands proof thereof at trial. Plaintiff denies the allegation that it received a Notice of Default. By way of further answer, Defendants addressed a Notice of Default to the Sub-Landlord and sent a copy of the Default Notice to Williams Associates. After reasonable investigation, Plaintiff lacks sufficient information to form a belief as to the accuracy of the allegation that a default went uncured for a thirty (30) day period. Accordingly, Williams Associates denies this allegation and demands proof thereof at trial. Plaintiff denies the allegation that due to Sub-Landlord' s alleged defaultf the sublease was terminated and considered null and void. By way of further answer, any Notice of Default which Defendants sent to the Sub-Landlord was stayed and therefore null and void by virtue of the Automatic Stay imposed upon Sub-Landlord's filing a Petition under Chapter 11 of the Bankruptcy Code. 76. Denied. This paragraph states several conclusions of law to which no answers are required. To the extent answers may be required, Williams Associates denies the allegation that it expressly acknowledged that PHB as Sub-Landlord was in default of the sublease agreement. William Associates further denies the inference that the letter of August 8, 2001 from Michael L. Solomonf Esq. to Defendant expressly acknowledged any such default. The letter of August 8, 2001 is a written document which speaks for itself. Williams Associates, accordingly, denies Defendant's characterization of the substance of that document. By way of further answerf the letter of August 8, 2001 merely advises Defendant's counsel of the procedural option of declaring a default on the sublease. It does not acknowledge that any such default took place. Finally, Williams Associates denies the allegation that it has waived any claim of default against the Sub-Tenant. 77. Denied. Williams Associates denies the allegation that Michael L. Solomon, Esq. orally advised Defendant Sullivan, LLC to cease all lease payments to the Sub-Landlord. Williams Associates further denies the allegation that it has waived any claim against the Sub- Landlord for failure to make lease payments. 78. Denied. Williams Associates denies that its counsel, Michael L. Solomon, Esq., orally advised Defendant Sullivan, LLC to cease all lease payments. The remaining allegations in this paragraph constitute legal conclusions to which no answer is required. To the extent 2 answers may be required, Williams Associates denies the allegation that it consented to Defendant's actions of withholding lease payments from Sub-Landlord. Williams Associates further denies the allegation that by allegedly consenting to the Sub-Tenants actions, Williams Associates is now barred from bringing the present action to recover the lease payments. 79. Denied. Williams Associates denies the allegation that its counsel, Michael L. Solomonf ESq'f expressly acknowledged Sub-Landlord's default in the sublease and orally advised the Sub-Tenant to cease all lease payments to the Sub-Landlord. Williams Associates further denies the allegation that Sub- Tenant justifiably relied upon any instruction provided by the Plaintiff or its counsel. Williams Associates further denies the allegation that it is barred from bringing the present action against the Sub-Tenant with regard to Sub-Tenant' s failure to make lease payments to Williams Associates. 80. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that it has failed to state a claim against Cardinal Therapies on all counts as a matter of law. 81. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that it has failed to state a claim against John Sullivan in his individual capacity on all counts as a matter of law. 82. Denied. This paragraph states a series of legal conclusions to which no answers are required. To the extent answers may be required, Williams Associates denies that Defendant Sullivan, LLC properly provided Notice of Default to the Sub-Landlord and Prime Landlord as required under the terms of the sublease. Williams Associates further denies that Defendant Sullivan, LLC properly allowed for the appropriate period for curing the default to expire before acknowledging default by the Sub-Landlord and Prime Landlord and declaring 3 the sublease allegedly terminatedf null and void. Williams Associates further denies the allegation that Defendant Sullivan, LLC did not default on the sublease. Finally, Williams Associates denies the allegation that it has no legally cognizable damages under any count as a matter of law. By way of further answer, Defendant Sullivan, LLC's purported Notice of Default to the Sub-Landlord, a debtor undergoing reorganization under Chapter 11 of the Bankruptcy Code, was provided in violation of the automatic stay and was, accordingly, null and void and without any legal effect whatsoever. 83. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that Defendant is not liable for damages on or after July 30f 2002. By way of further answerf Defendants continue to be liable for damages which accrued after July 30, 2002 either to Williams Associates or to its assigns and/ or successors-in-interest. 84. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that Defendant's actions and conduct in this matter were lawful, proper, privileged, and justifiable. 85. Denied. This paragraph states a conclusion of law to which no answer is required. 86. Denied. This paragraph states a series of conclusions of law to which no answers are required. To the extent answers may be required, Williams Associates denies the allegation that the actions or inactions of PHB and Williams Associates amounted to a substantial failure of consideration with regard to the sublease. Williams Associates further denies the allegation that any party failed to cure any sewer problem within any deadline set forth under applicable law. Finally, Williams Associates denies the allegation that the premises were not suitable for the operation of a medical office. 4 87. Denied. This paragraph states a series of conclusions of law to which no answers are required. To the extent answers may be required, Williams Associates denies the allegation that the actions or inactions of the Sub-Landlord, PHB, and the Plaintiff, as Prime Landlord, resulted in substantial failure of consideration with regard to the sublease. Williams Associates denies the allegation that it failed to provide water and sewer services to the leased premises. Williams Associates further denies the allegation that the premises were not suitable for business operations. Williams Associates further denies the allegation that there no longer existed the significant portion of consideration for entering into the sublease. In addition, Williams Associates denies the allegation that Sub-Tenant was justified in retaining lease payments during the time period in which utilities were not provided. Williams Associates further denies the allegation that it had any obligation or ability to cure the alleged default prior to obtaining relief from automatic stay and relieving PHB from its rights and duties under the lease. Finally, Williams Associates denies the allegation that its actions or the actions of PHB resulted in a default under the sublease. 88. Denied. This paragraph states a series of conclusions of law to which no answers are required. To the extent answers may be requiredf the Sublease Agreement is a written document which speaks for itself. Williams Associates denies Defendants' attempt to summarize the contents of the Sublease Agreement. Williams Associates further denies the allegation that provision of utilities was a significant portion of the Sub-Tenant' s consideration in entering into the Sublease Agreement. After reasonable investigation, Williams Associates lacks sufficient information to form a belief as to the accuracy of the allegation that as a result of PHB's failure to take certain actions with regard to the service of utilitiesf Defendant Sullivan, LLC was forced to incur numerous and expensive service and repair bills. Williams Associates, accordingly, denies this allegation and demands proof thereof at trial. Because Williams 5 Associates lacks sufficient information to form a belief as to the accuracy of Defendant's allegation that it incurred numerous repair and service bills, it similarly denies the allegation that Sullivan, LLC was justified in withholding lease payments as a setoff for the alleged repair and service bills. 89. Denied. This paragraph states yet another series of legal conclusions to which no answers are required. To the extent answers may be required, Williams Associates denies the allegation that Defendant Sullivan, LLC properly provided Notices of Default to Sub-Landlord and Prime Landlord as well as the allegation that Defendant Sullivan, LLC properly allowed for the applicable cure period to expire before declaring default and declaring the sublease terminated, null and void. Williams Associates further denies the allegation that Sullivan, LLC's Declaration of Default did not constitute" an act to obtain possession of property of the estate or property from the estate or to exercise control over property of the estate." See 11 US.c. s362(a)(3). Defendant Sullivan, LLC's proported termination of Debtor's property interests in the lease was certainly an act to obtain possession of the estate or property from the estate or to exercise control over property of the estate. Similarly, Williams Associates denies the allegation that Sullivan, LLC's actions did not constitute" an act to collect, assess, or recover claims against a debtor. . ." See 11 U.S.c. s362(a)(6). By way of further answerf Sullivan, LLC sought to assess a claim against the Debtor for alleged breach of the Sublease Agreement. Sullivan now appears to be pressing this claim in its counterclaim against Williams Associates. In additionf Williams Associates denies the allegation that Sullivan, LLC was not a creditor to the estate and the further allegation that the automatic stay provisions were, accordingly, inapplicable. By way of further answer, the automatic stay provisions set forth in the Bankruptcy Code apply to all entities, not merely to creditors of the Debtor. Sullivan, LLC's allegation that Sullivan, LLC was not a creditor of the estate is, accordingly, irrelevant. FinallYf 6 Williams Associates denies the allegation that PHB and Williams Associates were in default of the lease and that Sullivanf LLC properly satisfied the contractual requirements for terminating the sublease. ANSWER TO COUNTERCLAIM 90. Plaintiff incorporates by reference the allegations set forth in paragraphs 1 through 73 of its Complaint and paragraphs 74 through 89 of its Answer to New Matter. 91. Admitted. 92. Denied as stated. This paragraph contains a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that the Sublease Agreement was a contract between Sullivan, LLC and PHB with Plaintiff's consent. By way of further answer, Plaintiff, Defendant, and PHB all had various rights and responsibilities under the Sublease Agreement. 93. Denied. The Sublease Agreement is a written document which speaks for itself. Williams Associates, accordinglYf denies Defendant's characterization or summary of the contents of that Agreement. 94. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates lacks sufficient information to form a belief as to the accuracy of the allegation that PHB failed to provide water and sewer utilities "reasonably necessary for a medical office practice." Accordingly, Williams Associates denies this allegation and demands proof thereof at triaL 95. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies that Defendant Sullivanf LLC provided a legally effective Notice of Default. 7 96. Denied. Williams Associates denies the allegation that neither the Plaintiff as Prime Landlord nor PHB as Sub-Landlord cured nor attempted to cure the alleged default. By way of further answer, shortly after the Bankruptcy Court, by Order dated October 4, 2001, granted Debtor's Motion to Reject the Leasef and thereby granted relief from the automatic staYf Williams Associates, by letter dated October 17f 2001, attached to Defendant's Counterclaim as Exhibit" A", assumed the duties of the Debtor and, thereafter, made any and all necessary repairs to the property. 97. Denied. This paragraph states a conclusion of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that sewer services suitable for running a medical office were not provided as well as the allegation that PHB and Plaintiff failed to provide a significant portion of the consideration offered for Sullivan, LLC to enter into the sublease. 98. Denied. This paragraph states a series of conclusions of law to which no answer is required. To the extent an answer may be required, Williams Associates denies the allegation that the leased premises were not suitable for the business purpose for which they were leased as well as the allegation that Sullivan, LLC was constructively evicted from the leased premises. By way of further answerf Defendant Sullivan, LLC was very well aware that the Sub- Landlord, PHBf was undergoing reorganization proceedings under Chapter 11 of the Bankruptcy Code and that Williams Associates could not take any action with regard to the leased premises until it received relief from automatic stay from the Bankruptcy Court. Defendant Sullivan, LLC was also very much aware that Williams Associates intended to make any and all necessary repairs to the property immediately upon receiving relief from automatic stay. In fact, Williams Associates did make all necessary repairs shortly after the automatic stay was lifted in this case. Defendant Sullivan, LLC merely used Debtor's alleged temporary 8 failure to provide certain utility services as an excuse to terminate its Sublease Agreement and relocate to smaller premises to compensate for loss of Dr. Sullivan's medical practice associate and corresponding loss of income. 99. Denied. Williams Associates denies that Defendant Sullivanf LLC suffered any damages as a result of the allegedly uninhabitable conditions of the leased premises including moving expenses, staff labor, lost revenuef and lost future revenue. After reasonable investigation, Williams Associates lacks sufficient information to form a belief as to whether Defendant Sullivan, LLC incurred any sewer service and repair bills. Accordingly, Williams Associates denies this allegation and demands proof thereof at trial. NEW MAITER 100. Williams Associates incorporates by reference its answer to paragraphs 74 through 89 of Defendants' New Matter and paragraphs 90 through 99 of Defendants' Counterclaim. 101. In its prayer for relief, Sullivanf LLC demands judgment for an amount in excess of $35,000.00 plus attorneys' fees and costs. 102. Defendant Sullivan, LLC has failed to state a legally cognizable claim against Williams Associates for attorneys' fees. 103. In its Counterclaim, Defendant Sullivan, LLC seeks reimbursement for various alleged consequential damages such as moving expenses, staff labor, and lost revenue. 104. Defendant Sullivanf LLC has failed to state a legally recognizable claim against Williams Associates for such consequential damages. 9 WHEREFORE, Plaintiff, Williams Associates requests that this Court enter an Order denying all relief requested by Defendants in their New Matter and Counterclaim and, instead, entering judgment in favor of Plaintiff Williams Associates and against Defendants as set forth in Plaintiff's Complaint. Respectfully submitted, LAW OFFICES of MARKIAN R. SLOBODIAN ~ 1/,-- MARKIAN R. SLOBODIAN, ESQ. LD. No. 41075 ANDREW R. EISEMANN, ESQ. LD. No. 87441 801 North Second Street Harrisburg, PA 17102 717/232-5180 MICHAEL L. SOLOMON, ESQ. ID No. 36031 212 Locust Street, Suite 500 Harrisburg, P A 17101 Dated: OJ- <f .}...I>1- I Counsel for Williams Associates, Plaintiff 10 VERIFICATION I, MICHAEL L. SOLOMON, hereby verify that the facts contained in the foregoing pleading are true and correct to the best of my knowledge, information and belief. I understand that false statements herein are subject to the penalties of 18 Pa. C.SA S 4904 relating to unsworn falsification to authorities. DATE: October -1-,2002 CERTIFICATE OF SERVICE I, Markian R. Slobodianf hereby certify that I have this date, mailed a true and correct copy of the foregoing Plaintiff's Answer to New Matter and Counterclaim by United States mail, first-class, postage prepaid, addressed to the following individual(s): LeRoy Smigel, Esquire Smigel, Anderson & Sacks 2917 North Front Street Harrisburg, PA 17110-1260 ~-1--- Dated: ,,,,1.,(0').- MARKIAN R. SLOBODIANf ESQ. () c =- ::':, ,70:1 ~l~I'i 2C-~ (/) ~c~ -< r-' 5~ -... -''''.(...' :L~ f'~ 2: :;l , .-y :.n (':;) o ,.." o C, -f , \.D o -q ::::! ~1 ~~:.! .~ !~q j,,- I () "I! --r') . S) "' n :::~ -....~ ::::; -< -n WILLIAMS ' ASSOCIATES, Plaintiff, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, Defendants. CIVIL ACTION - LAW DEFENDANTS' RESPONSE TO PLAINTIFF'S NEW MATTER TO COUNTERCLAIM AND NOW COMES, Defendants, John M. Sullivan, M.D. and Associates, L.L.C., Cardinal Therapies, P.C. & John M. Sullivan, by and through their counsel Smigel, Anderson & Sacks, L.L.P. and files the following Response to Plaintiffs New Matter to Counterclaim by stating the following: 100. Defendants John M. Sullivan, M.D. and Associates, L.L.C., Cardinal Therapies, P.e. & John M. Sullivan ("Defendants") incorporate by reference the responsive averments contained in paragraphs 1 through 99 of Defendants' Answer with New Matter and Counterclaims as if fully set forth herein. 101. Admitted. 102. Denied. The averment contained in paragraph 102 of Plaintiffs New Matter to Counterclaim contains a conclusion of law to which no responsive pleading is required. Therefore, the averment is denied. By way of further answer, it is denied that Defendants have failed to state a legally cognizable claim against Williams' Associates for attorneys' fees. 103. Admitted in part and denied in part. It is admittc;:d that the Defendants seek reimbursement for damages Defendants suffered as a result of Plaintiff Williams' Associates breach on contract. By way of further answer, Defendants' damages are in excess of$35,000. These damages include but are not limited to moving expenses, stafflabor, lost revenue, lost future revenue, and service and repair bills. The damages are listed in paragraph 99 of Defendants' Answer with New Matter and Counterclaim. Therefore, any conclusions, summary, or characterization made by the Plaintiff regarding contents of that paragraph are denied as the pleading speaks for itself. 104. Denied. The averments contained in paragraph 104 of Plaintiffs New Matter to Counterclaim contains a conclusion of law to which no responsive pleading is required. Therefore, the averment is denied. By way of further answer, it is denied that Defendants have failed to state a legally recognizable claim against Williams' Associates for what it characterizes to be "consequential" damages. WHEREFORE, Defendants request that this Court enter an Order denying the relief sought by the Plaintiffs in their Answer and now New Matter, and enter judgment in favor of the Defendants and against Williams' Associates for an amount in excess of$35,000 plus attorneys' fees and costs as set forth in Defendants' Counterclaim. SMIGEL, ANDERSON & SACKS, LLP Date: ~- ~l- <:. ~ Q V'V\ "" ( Le oy Smigel I. . #09617 Susan M. Zeamer I.D. #82023 4431 North Front Street, 3rd Floor Harrisburg, PA 17110-1709 (717) 234-2401 Attorneys for Defendants 2 WILLIAMS ' ASSOCIATES, Plaintiff, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01-6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, Defendants. CIVIL ACTION - LAW CERTIFICATE OF SERVICE I, Susan M. Zeamer, Esquire, attorney for the Defendants in the above-captioned matter, do hereby certify that I served a true and correct copy of DEFENDANTS' RESPONSE TO PLAINTIFF'S NEW MATTER TO COUNTERCLAIM on counsel for the Plaintiff by depositing the same in the U.S. Mail, on this ; 7 th day of ~~003, postage prepaid for first class mail, addressed as follows: MARKIAN R. SLOBODIAN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG, PA 17108-1967 MICHAEL 1.. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISBURG,PA 17101 SMIGEL, ANDERSON & SACKS, LLP Date: J'~ J..1-6~ Y;;;z. <h'\. oy Smigel . #09617 . Susan M. Zeamer J.D. #82023 4431 North Front Street, 3rd Floor Harrisburg, PA 17110-1709 (717) 234-2401 Attorneys for Defendants 3 (') c: -".. <, '"U5:1 mr.l.i Z,-' LC-" (/' .. ~2' ~C er, ~b c ~ o w ....., rl'1 CO N co -0 :Jt: N o "n ;cj ,'-~~~ (5{~n -I Of> ~ -< w '" PRAECIPE FOR LISTING CASE FOR TRIAL (Must be typewritten and submitted in duplicate) TO THE PROTHONJrARY OF CUMBERLAND COUNrY Please list the following case: (Check one) for JURY trial at the next term of civil court. X) for trial without a jury. ----------------------------------------- CAPTION OF CASE (entire caption must be stated in full) (check one) ( X ) Civil Action - Law Appeal from Arbitration Williams Associates (other) (Plaintiff) vs. John M. Sullivan, MD & Associates, LLC, Cardinal Therapies, PC & John M~ Sullivan, The trial list will be called on and Trials commence on (Defendant) Pretrials will be held on (Briefs are due 5 days before pretrials.) vs. (The party listing this case for trial shall provide forthwith a copy of the praecipe to all counsel, pursuant to local Rule 214.1.) No.01-6201 Civil 19 Indicate the attorney who will try case for the party who files this praecipe: Markian R. Slobodian, Esq. Indicate trial counsel for other parties if known: LeRoy Smigel, Esq. This case is ready for trial. Signed: ~~~ Print ~: Markian R. Slobodian 1/ 1,0111"], Attorney for: Williams Assoc., Plaintiff Date: CERTIFICATE OF SERVICE I hereby certify that I have this date, mailed a true and correct copy of the foregoing Praecipe by United States mail, first-class, postage prepaid, addressed to the following individual(s): LeRoy Smigel, Esq. Smigel, Anderson & Sacks 2917 North Front Street Harrisburg, PA 17110-1260 ~-1 Markian R. Slobodian Dated: (I \ ,.l.."') ...... 0 co 0 c:: W -n ~ ::::!: ~:" -J v'rr' '.:J "T1 ITlf: r~ f--:; .....,;?T ~-_.. Z ~~ .. !:_~J ~ ['.) ~~) kt~ ''0 .. ~r, ~-, :r. )C) L- t;..,~, ~- c. ~ ;~rn ?C~. -7 ,> Si ;J'1 ~~ ,l:"" WILLIAMS ASSOCIATES V. IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA NO. 01-6201 CIVIL JOHN M. SULLIVAN, MD & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN IN RE: PRETRIAL CONFERENCE ORDER OF COURT AND NOW, November 14, 2003, the above-captioned case is listed for pre-trial conference on Wednesday, December 17, 2003; counsel to follow the usual briefing schedule. The date for the trial will be decided at the pre-trial conference. By the Court, P.J. ~arkian R. Slobodian, Esquire 801 North Second Street Harrisburg, PA 17102 > LO'f~ fY) ~1{~ 11- J L/ -03 ~eRoy Smigel, Esquire 2917 North Front Street Harrisburg, PA 17110 Court Administrator \j1rNillJ,SNN:1d , 'rl!",-("~\ ,-,,~"_.,\. ,''''-,!.'<In'' ;\..;" ,: ,,!; :- ,-_~r:H'l1 J (; I : \ \ \PJ'11 ..UN SO AHll(:,\'--,',,' 'i]_ JO j'J\:\ ::!,.).{j,:,:n_~':l 15 - Hoffer WILLIAMS ASSOCIATES, Plaintiff IN THE COU:U OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA V. JOHN M. SULLIVAN, M.D. & 01-6201 CIVIL TERM ASSOCIATES, LLC, CARDINAL: THERAPIES, P.C. & JOHN M. SULLIVAN, CIVIL ACTION - LAW Defendants IN RE: PRETRIAL CONFERENCE In this contract case, Markian R. Slobodian, Esquire, represents the plaintiff, and LeRoy Smigel, Esquire, and Susan Zeamer, Esquire, represent the defendants. Plaintiffs are a group that owns an office building in Cumberland County. Plaintiff leased various space to a group of doctors called Promedco. This group subleased certain premises to defendants. Promedco subsequently went into bankruptcy at some point and plaintiff claims that the defendants :,n this case took the place of the bankrupt parties in regard to rental and lease obligations. Those obligations would have carried over from July 1, 2001, through the term of the lease ending on March 31, 2004. 01-6201 In Re: Page 2 Civil Term Pretrial Conference In July 2001 defendants moved out of the premises. Defendants claim that the premises became uninhabitable due to various water and sewer problems causing them to move out. The defendants have a counterclaim for various lost business and other itmes of damages because they had to move. Defendants indicate that they will be filing a motion for summary judgment to decide certain questions of law. This court directs that outstanding discovery will be responded to by the plaintiff within thirty days of today's date. From that date, the parties will have thirty days to complete depositions. From that date, the parties have thirty days to file a motion for summary judgment. This case shall be tried non-jury in front of a judge to be assigned to the case. At the time the trial judge sets a time for trial, the court will expect each side to have a complete set of Findings of Fact and Conclusions of Law to support their case-in-chief and any counterclaim for damages. These documents must be furnished to the court by each counsel at least three weeks before trial datef and 01-6201 In Re: Page 2 Civil Term Pretrial conference each counsel shall respond with an answering document, admitting or denying, one week before the trial date to the trial judge. By the Court, .J. Markian R. Slobodian, Esquire 801 North Second Street Harrisburg, Pa. 17102 For the Plaintiff LeRoy Smigel, Esquire Susan Zeamer, Esquire 2917 North Front Street Harrisburg, Pa. 17110-1260 For the Defendants / Prothonotary L. Court Administrator :mtf -. /1;;:) ~ I :2 \~d 2Z :no EOOl )\'~N~"Ci<OH-LCUd 3~1 :10 :]8LJ~O"'G311:l WILLIAMS ASSOCIATES, PLAINTIFF V. JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P,C. & JOHN M. SULLIVAN, DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 01-6201 CIVIL TERM ORDER OF COURT AND NOW, this 14th day of January, 2004, the trial on the within action shall be conducted on Thursday, March 4, 2004, at 8:45 a.m., in Courtroom No.2, Cumberland County Courthouse, Carlisle, Pennsylvania. The case having been assigned to this judge the last paragraph of the pretrial conference memorandum of December 17, 2003 is deleted. Instead, counsel shall each have a trial brief to be presented to the court at the commencement of trial. No findings of fact or conclusions of law are necessary. vMarkian R. Slobodian, Esquire 801 North Second Street Harrisburg, PA 17102 For Plaintiff AeRoy Smigel, Esquire Susan Zeamer, Esquire 2917 North Front Street Harrisburg, PA 17110-1260 For Defendants :sal By the Court, ~ f ~. r\) . / L-f~.~.A- ~ Ol-I~-()t./ \i!!',,:\/i\l}, '~?< [\~Jd '" 1\L1 .!:~';I' '-'-'''n'' '~::,.y~ IV 68:8 II! II\JI~ fooD' 7 . ,,~, j U (" }..},:\/i.C\j;:):"IlDHd 3Hl .:10 -,:j'~)H::tO-{JjlH WILLIAMS ASSOCIATES, PLAINTIFF V. JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA : 01-6201 CIVIL TERM ORDER OF COURT AND NOW, this 22nd day of January, 2004, the order of January 14, 2004, setting a trial date for March 4, 2004, is vacated as prematurely entered.' ./Markian R. Slobodian, Esquire 801 North Second Street Harrisburg, PA 17102 For Plaintiff ~eRoy Smigel, Esquire Susan Zeamer, Esquire 2917 North Front Street Harrisburg, PA 17110-1260 For Defendants Court Administrator :sal By the Court, ~j.~ Edg . Bay ey, J. ' ~~ ~ OI-1~.O~ 1 The pretrial conference memorandum of Judge Hooffer reflects that defendants intend to file motions for summary judgment. The case is not at issue. S?, :7.. \c':d zz ir~r \-1~G"l. 11 II II I I WILLIAMS ' ASSOCIATES, Plaintiff, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01.6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES,LLC,CAJUDINAL THERAPIES, P.C. & JOHN M, SULLIVAN, CIVIL ACTION - LAW Defendants. NOTICE TO PLEAD TO: MARKIAN R. SLOBODIAN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG, PA 17108-1967 MICHAEL L. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISBURG,PA 17101 You are hereby notified to file a written response to the enclosed Motion for Summary Judgment within twenty (20) days from service hereof or a judgment may be entered against you. SMIGEL, ANDER N & SACKS, LLP Date:~ , B' ~~1'-- I~ , eter M. Good .0. #64316 Susan M. Zeamer 1.0. #82023 4431 North Front Street, 3rd Floor Harrisburg, P A 1711 0.1709 (717) 234.2401 Attorneys for Defendants WILLIAMS' ASSOCIATES, Plaintiff, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01.6201 CIVIL TERM JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CAJUDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, Defendants. CIVIL ACTION - LAW ORDER AND NOW, this day of , 2004, it is hereby Ordered that Defendants John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.C. and John M. Sullivan's Motion for Swnmary Judgment is granted and each Count of Plaintiff's Complaint is dismissed with prejudice. By The Court: J. II II I I I WILLIAMS ' ASSOCIATES, Plaintiff, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. JOHN M. SULLIVAN, M.D. & ASSOCIATES,LLC,CAJUDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, No. 01-6201 CIVIL TERM Defendants. CIVIL ACTION -- LAW DEFENDANTS' MOTION FOR SUMMARY JUDGMENT John M. Sullivan, M.D, & Associates, LLC, Cardinal Therapies, P.C. and John M. Sullivan (collectively "the Defendants"), by their undersigned counsel, Smigel, Anderson & Sacks, LLP, respectfully move for summary judgment on all Counts of Plaintiffs Complaint under Rule 1035.2 of the Pennsylvania Rules of Civil Procedure, Cumberland County local Rule 206-2, and, in support thereof aver as follows: I. In accordance with Cumberland County Local Rule 206-2, the Honorable George E. Hoffer, President Judge, presided over the pretrial conference in the matter sub judice. 2. In accordance with Cumberland County Local Rule 206-2, the Honorable Edgar B. Bayley was assigned to preside over the trial in this matter and has since ruled on a request to remove the matter from the trial list. Factual Backeround: 3. On or about April 14, 1999, Plaintiff leased the facility at issue ("Leased Premises") to PHB Management Company ("PHB"). 4. On or about February 2001, PHB and John M. Sullivan, M.D. & Associates, LLC entered into a sublease agreement for the Leased Premises, with Plaintiff's consent. 5. Immediately upon leasing the Leased Premises, Defendant began to experience water and sewer problems at the Leased Premises. 6, Defendant began incurring weekly service bills in an attempt to resolve the water and sewer problems at the Leased Premises. 7. PHB was not paying for the water and sewer repair services and failed to reimburse Defendant who paid for the same out of pocket. 8. On or about July 14, 2001, PHB filed a voluntary Petition for bankruptcy under Chapter 11 of the United States Bankruptcy Code with the Bankruptcy Court for the Northern District of Texas, Ft. Worth Division. 9. By letter dated August 9,2001, Defendant John M. Sullivan, M.D., & Associates, LLC, by its counsel, declared a default by PHB due to certain water and sewage problems on the Leased Premises. Said letter was sent via certified mail with return receipt requested and copied simultaneously to the Prime Landlord, Plaintiff Williams Assodates. Lel!al Backl!round: 10. Under Section 18 of the Medical Office Sublease Agreement between John M. Sullivan, M.D., & Associates, LLC and PHB ("Sublease Agreement"), written notice of default of either the Prime Landlord, here Plaintiff, or the Sub landlord, here PHB, must be given to both the Sublandlord and Prime Landlord. Written notice of default was given to PHB and copied to Plaintiff, on August 28, 2001. See Exhibit C and Exhibit D of Plaintiffs Complaint. 11. Under the Sublease Agreement, either the Prime Landlord or the Sub landlord must cure the default within thirty (30) days from the date of reGeipt of said written notice, thereby giving either the opportunity to cure said default. 2 12. Following the expiration of the thirty (30) day period, Defendant John M. Sullivan M.D. & Associates, LLC executed a letter dated October 1,2001, providing written notice to the Plaintiff and PHB that since neither had cured thf' default, Defendant John M. Sullivan, M.D. & Associates, LLC was exercising its option under the Sublease Agreement to declare the Sublease Agreement terminated, ended, null and void. See Exhibits A and D of Plaintiffs Complaint. 13. Within the same letter, Defendant John M. Sullivan, M.D. & Associates, LLC stated its intention to vacate the Leased Premises within a reasonable time. See Plaintiffs Complaint, , 49 and Exhibit D. 14. Defendant did not vacate the premises until after the Prime Lease and sublease in question, as well as all other unexpired leases involving PHB, were rejected by the Trustee in bankruptcy. The Order rejecting all unexpired leases was issued October 4, 200 I. 15. Defendant vacated the Leased Premises on or about October 29, 2001. COUNT I Williams Associates v. John M. Sullivan. M.D. & Associates. LLC Breach of Contract 16. Defendants hereby incorporate paragraphs 1-15 of this Motion for Summary Judgment as if fully stated herein. 17. Plaintiff, as the Prime Landlord, seeks compensatory damages, in the amount of $180,621.21, claiming that Defendant John M. Sullivan M.D. & Associates, LLC breached the Sublease Agreement it entered into with PHB by abandoning the Leased Premises and, thereafter, failing to pay monthly rent. See Plaintiff's Complaint, " 26-31. 18. Plaintiff has failed to produce any facts that would support a finding that Defendant John M. Sullivan M.D. & Associates, LLC defaulted on its obligations under the 3 Sublease Agreement. Additionally, the Sublease Agreement was entered into between PHB and Defendant John M. Sullivan, M.D. & Associates, LLC and, as such, Defendant was not required to make rental payments to Plaintiff. 19. It is uncontroverted that Defendant John M. Sullivan M.D, & Associates, LLC properly followed the terms and conditions ofthe Sublease Agreement, exercising its right to terminate the Sublease Agreement after notice of default and an opportunity to cure were provided to Plaintiff and PHB. See Plaintiffs Complaint, Exhibits C and D. 20. Moreover both the Prime Lease and the Sublease were rejected by the Trustee prior to the Defendant terminating the Sublease Agreement. WHEREFORE, Defendant John M. Sullivan, M.D. & Associates, LLC requests that this Court enter Judgment in its favor and against Plaintiff, Williams Associates, dismissing the cause of action against Defendants for Breach of Contract. COUNT II Williams Associates v. John M. Sullivan. M.D, & Associates. LLC Uniust Enrichment - (In the Alternative) 21. Defendants hereby incorporate paragraphs 1.20 of this Motion for Summary Judgment as if fully stated herein. 22. The Plaintiff has alternatively pled for damages in quantum meriut in the amount of$15,612.87, which represents the amount of rent allegedly owed to it from the date that the Bankruptcy Court for the Northern District of Texas, Fort Worth Division, granted debtor's Motion to Reject all unexpired leases, to the date that Defendant vacated the Leased Premises on October 29,2001. See Plaintiffs Complaint, ~~ 32-36. 23. Plaintiff has failed to produce any facts that would support a finding that the Defendant has been unjustly enriched during the time frame from when the unexpired leases 4 were rejected by the Trustee to the date that Defendants terminated the Sublease Agreement and vacated the Leased Premises. 24. It is uncontroverted that PHB breached the Sublease Agreement with Defendant, despite notices provided by the Defendant, and that both PHB and Plaintiff failed to cure the breach. As a result, and in accordance with the terms of the Sublease Agreement, Defendant terminated the Sublease agreement. See Plaintiffs Complaint, Exhibits C and D. 25. Moreover, the unexpired leases associated with PHB were rejected through the bankruptcy proceedings, including the Prime Lease between Plaintiff and PHB and the Sublease Agreement between PHB and the Defendant. Plaintiff has no authority to seek redress against Defendant. WHEREFORE, Defendant John M. Sullivan, M.D. & Associates, LLC requests that this Court enter Judgment in its favor and against Plaintiff, Williams Associates, dismissing the cause of action against the Defendant for Unjust Enrichment. COUNT III Williams Associates v. Cardinal Therapies. P.C. Trespass 26. Defendants hereby incorporate paragraphs 1-25 ofthis Motion for Summary Judgment as if fully stated herein, 27. Plaintiff seeks damages in the amount of$7,000, against Defendant Cardinal Therapies, P.C., for an alleged trespass on and damage to propflrty that was in the same building as the Leased Premises but allegedly did not constitute part of the Leased Premises. See Plaintiffs Complaint, '\['\[37-47, 28. Plaintiff has failed to produce any facts that would support a finding that Cardinal Therapies, P.C. trespassed on the property and/or caused damages as alleged. 5 29. To the contrary, it is uncontroverted that Cardinal Therapies, P.C, was rightfully on the property and that only the property contained within th(: Leased Premises was accessed. Moreover, Plaintiff has acquiesced to this fact through deposition testimony. As such, the claim cannot stand as it has no basis in law or fact. WHEREFORE, Defendant Cardinal Therapies, P.C. requests that this Court enter Judgment in its favor and against Plaintiff, Williams Associates, dismissing the cause of action against Defendant for Trespass. COUNT IV Williams Associates v. John M. Sullivan Trespass 30. Defendants hereby incorporate paragraphs 1-29 of this Motion for Summary Judgment as if fully stated herein. 31. Plaintiff seeks damages in the amount of$7,000 against Defendant John M. Sullivan in his individual capacity for an alleged trespass and damage of property that was in the same building as the Leased Premises but did not constitute part of the Leased Premises. See Plaintiffs Complaint, ~~ 48-59. 32. Plaintiff has failed to produce any facts that would support a finding that Defendant trespassed or damaged property that was in the same building as Leased Premises but did not constitute part of the Leased Premises. 33. To the contrary, it is uncontroverted that John M. Sullivan was rightfully on the property and thus only the property comprising the Leased Premises was accessed. Moreover, Plaintiff has acquiesced to this fact through Deposition testimony. As such, Plaintiffs claim cannot stand as it has no basis in law or fact. 6 WHEREFORE, Defendant John M, Sullivan requests that this Court enter Judgment in its favor and against Plaintiff, Williams Associates, dismissing the cause of action against Defendant for Trespass, COUNT V Williams Associates v, Cardinal Therapies. P,C. Uniust Enrichment 34. Defendants hereby incorporate paragraphs 1.33 of this Motion for Summary Judgment as if fully stated herein. 35. In an additional alternative pleading, Plaintiff seeks damages in quantum meriut, against Cardinal Therapies, P.C., in the amount of $7,000, which allegedly represents both the fair rental value of the unleased portion of property that was located in the same building as the Leased Premises but allegedly did not constitute part ofthe Leased Premises and the amount of money needed to restore said property to its unaltered condition. See Plaintiff's Complaint, ~~ 60.66. 36. Plaintiffhas failed to produce any facts that would support a finding that Defendant was unjustly enriched through the use of said property and/or avoidance of paying costs to restore the allegedly damaged unleased property. 37. To the contrary, the undisputed facts indicate that Cardinal Therapies, P.C. was rightfully on the property and that only the property comprising the Leased Premises was accessed. Moreover, Plaintiff has acquiesced to this fact through Deposition testimony. As such, Plaintiff's claim cannot stand as it has no basis in law or fact. WHEREFORE, Defendant Cardinal Therapies, P.C. requests that this Court enter Judgment in its favor and against Plaintiff, Williams Associates, dismissing the cause of action against Defendant for Unjust Enrichment 7 II '11 I COUNT VI Williams Associates v. John M. Sullivan Uniust Enrichment 38. Defendants hereby incorporate paragraphs 1-37 of this Motion for Summary Judgment as if fully stated herein. 39. In an additional alternative pleading, Plaintiff seeks damages in quantum meriut, against John M. Sullivan in his individual capacity for the amount of $7,000 which allegedly represents both the fair rental value of the unleased portion of property that was located in the same building as the Leased Premises but did not constitute part ofthe Leased Premises as well as the amount of money needed to restore the property to its unaltered condition. See Plaintiffs Complaint, ~~ 67.73. 40. Plaintiff has failed to produce any facts that would support a finding that Defendant was unjustly enriched through the use of said property and/or avoidance of paying costs to restore the allegedly damaged unleased property. 41. To the contrary, the undisputed facts indicate that John M. Sullivan was rightfully on the property and that only the property comprising the Leased Premises was accessed. Moreover, Plaintiff has acquiesced to this fact through Deposition testimony. As such, Plaintiff's claim cannot stand as it has no basis in law or fact. 42. As all necessary discovery by both parties has occurred, it is apparent that there is no genuine issue of any material fact as to any necessary element of the cause of actions that Plaintiff has alleged. There are no disputed facts that would support a cause of action against the Defendants. 43. Moreover, the facts establish that the Defendants properly followed the terms and conditions of the Sublease Agreement, exercising the right to terminate the Sublease Agreement 8 upon the default ofPHB, and doing so only after proper notice and the rejection of the unexpired leases through the bankruptcy proceedings. 44. Additionally, Plaintiff lacks standing to sue the Defendants under the causes of action enumerated in its Complaint as there is no privity of contract between Plaintiff and Defendants. As such, they are an improper party to seek redr(:ssability of their alleged injuries. This is particularly true in light of the fact that both the Prime Lease, between Plaintiff and PHB, and the Sublease Agreement, between PHB and the Defendants, were rejected by the Trustee in bankruptcy prior to Defendants terminating the sublease. WHEREFORE, Defendant requests that this Court enter Judgment in its favor and against Plaintiff, Williams Associates, dismissing the cause of action against Defendants for Unjust Enrichment. Respectfully submitted, SMIGEL, ANDERSON & SACKS, LLP Date:~(1A 0, .)0'1. LI f~/ka.", ~ ,- Pe r M. Good LI .#64316 Susan M. Zeamer LD. #. 82023 4431 North Front Street Harrisburg, P A 17110 (717) 234-2401 Attorneys for Defendants 9 WILLIAMS' ASSOCIATES, Plaintiff, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. JOHN M. SULLIVAN, M.D. & ASSOCIATES,LLC,CAJUDINAL THERAPIES, P.C. & JOHN M, SULLIVAN, No. 01.6201 CIVIL TERM Defendants. CIVIL ACTION - LAW CERTIFICATE OF SERVICE I, Susan M. Zeamer, Esquire, attorney for the Defendants in the above-captioned matter, do hereby certify that I served a true and correct copy of DEFENDANTS' MOTION FOR SUMMARY JUDGMENT on counsel for the Plaintiff by depositing the same in the U.S. Mail, on this n~ day of _~~ ,2004, postage prepaid for first class mail, addressed as follows: MARKIAN R. SLOBODIAN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG,PA 17108-1967 MICHAEL L. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISB1JRG,PA 17101 SMIGEL, ANDERSON & SACKS, LLP Date: (\\<Y\c lrt 01 d60Y B~ ,~ ".~ ~ Pet r M. Good 1.0.#64316 Susan M. Zl:amer 1.0.#82023 4431 North Front Street, 3rd Floor Harrisburg, PA 17110.1709 (717) 234.2401 Attorneys for Defendants (> c t?-. <",:.,-,-', ; o -n .' :"'>J -' co) - ~.) WILLIAMS ASSOCIATES, PLAINTIFF : I:'-! THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, P A v. : CIVIL ACTION .. LAW JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, : NO. 01-6201. Civil Term DEFENDANTS PLAINTIFF'S RESPONSE TO DEFENDANTS' MOTION FOR SUMMARY JUDGMENT NOW COMES, Plaintiff, Williams Associates, by its counsel, The Law Offices of Markian R. Slobodian and Michael L. Solomon, Esq., and makes the following Response to Defendants' Motion for Summary Judgment in the above.referenced case: 1. Admitted. 2. Denied. This paragraph states a conclusion oflaw to which no answer is required. To the extent an answer may be required, Plaintiff denies that the Court has issued any ruling on any request to remove the matter from the trial list. Factual Backl!round: 3. Denied as stated. Plaintiff denies that the tenant for the premises was PHB Management Company. By way of further answer, the Commercial Lease, dated April 14, 1999, identifies the tenant as PHB Management, Co., lnc ("PHB"). 4. Denied as stated. Plaintiff denies the characterization of the Sub-lease Agreement as an agreement between Defendant John M. Sullivan, M.D. & Associates, LLC ("Sullivan & Associates") and PHB with Plaintiffs consent. By way of further answer, the medical office sub.lease was an agreement signed by PHB, Sullivan & Associates, and Williams Associates. 5. Denied. Plaintiff denies that Defendant began to experience immediate water and sewer problems at the Leased Premises. By way of further answer, Defendant John M. Sullivan testified at his deposition that he only experienced one incidence of the sewer not functioning properly. Defendant Sullivan further testified that after that incident, he performed regular maintenance on the sewer line to ensure that he would not experience any further sewer problems. 6. Denied as stated. Plaintiff admits that Defendant Sullivan & Associates contracted for weekly sewer maintenance at the Leased Premises. Plaintiff denies that Defendant Sullivan & Associates incurred sewage bills for the services. By way of further answer, Defendant Sullivan & Associates forwarded its sewage maintenance bills to PRB for payment. 7. Denied as stated. Defendant Sullivan testified at his deposition that PRB paid for a number of the water and sewer maintenance services and that he paid for others. Defendant Sullivan could not specify which services he paid for and which were paid for by PRB. 8. Admitted. 9. Admitted in part and denied in part. Plaintiff admits that Defendant Sullivan & Associates, by its counsel, addressed a letter to PRB in which it purported to declare a default on the lease. Plaintiff also admits that Defendant sent a copy of the letter to Michael L. Solomon, Esq. The letter is a written document which speaks for itself. Plaintiff accordingly denies any summarization or characterization of the contents ofthese letters. Lellal Backllround 10. Denied. Section 18 of the Medical Office Sub.lease Agreement (the "Sub.lease Agreement") is a written document which speaks for itself. Plaintiff denies Defendant's summarization of the contents of Section 18 ofthe Sub.lease Agreement. Plaintifffurther denies the allegation that written notice of default was given to PRB and copied to Plaintiff on August 28, 200 I. By way of further answer, because PRB was in bankruptcy at the time, Defendant Sullivan & Associates was prevented by the automatic stay imposed by II V.S.C. 9362 from declaring any default and any such attempted declaration of default would have been null and void and without any legal effect. 2 II. Denied. The Sub-lease Agreement is a written document which speaks for itself. Plaintiff, accordingly, denies Defendants' characterization or summarization of this document. By way of further answer, because of the automatic stay, Plaintiff denies that it was under any obligation to cure any alleged default within the 30 day period specified in this paragraph. 12. Admitted in part and denied in part. Plaintiff admits that Defendant Sullivan & Associates' counsel executed the letter dated October I, 200 I. The letter is a written document which speaks for itself. Accordingly, Plaintiff denies any characterization or summarization of the contents of that letter. 13. Denied. The letter dated October I, 2001 is a written document that speaks for itself. Accordingly, Plaintiff denies any characterization or summarization of the contents of that letter. In addition, Plaintiff denies that the cited Paragraph 49 of Plaintiffs Complaint has any relevance to the allegation set forth in Paragraph 13 of Defendants' Motion for Summary Judgment. 14. Admitted in part and rejected in part. Plaintiff admits that PHB rejected its interest in the unexpired sub.lease and that such rejection was approved by Court Order dated October 4,2001. Plaintiff denies the averment that all other unexpired sub. leases involving PHB were rejected by the Trustee. 15. Admitted. COUNT I Williams Associates v. John M. Sullivan. M.D. & Associates. LLC - Breach of Contract 16. Plaintiff incorporates by reference its answers to Paragraphs I through 15 of Defendants' Motion for Summary Judgment. 17. Denied as stated. Plaintiff denies the inference that De~endant Sullivan & Associates failed to pay monthly rent after abandoning the Leased Premises. By way of further answer, Defendant Sullivan & Associates failed to tender rent payments due on July I, 200 I and thereafter. 3 18. Denied. Plaintiff denies that it has failed to produce any facts that would support a finding that Defendant Sullivan & Associates defaulted on its obligation under the Sub.lease Agreement. It is undisputed that Defendant Sullivan & Associates failed to make rent payments after July 1, 2001 and, further, that Defendant Sullivan & Associates abandoned the Leased Premises prior to the expiration of the lease term. Plaintiff further denies the allegation that Defendant Sullivan & Associates was not required to make rental payments to Plaintiff. Defendant Sullivan was required to make rental payments to PHB until the time the lease was rejected. At that time, pursuant to Section 16 of the sub.lease, Plaintiff duly exercised its option to assume the position of the sub.landlord under the sub.lease. After such assumption, Defendant Sullivan & Associates was required to make all rental payments directly to Plaintiff. 19. Denied. Plaintiff denies that Defendant Sullivan & Associates followed the terms and conditions of the Sub.lease Agreement, that it had any basis for terminating the Sub.lease Agreement, that it provided proper and effective notice of default and opportunity to cure, and that it properly terminated the Sub.lease Agreement. By way of further answer, Defendant Sullivan & Associates has failed to show that it had any right to declare a default under the Sub.lease Agreement. Moreover, because of the automatic stay imposed by II V.S.C. ~362, Defendant Sullivan & Associates' attempt to terminate the lease was premature, ineffective, and in violation ofth~ Federal Bankruptcy Law. 20. Denied. This paragraph states a conclusion oflaw to which no answer is required. To the extent an answer may be required, Plaintiff admits that PHB rejected its interest in the sub.lease with Defendant Sullivan & Associates. Plaintiff denies that PHB terminated the Sub.lease Agreement. By way offurther answer, pursuant to the terms of the Sub.lease Agreement, upon PHB's default, Williams Associates, as prime landlord, had the option of assuming the role of sub. landlord under the Sub.lease Agreement. PHB's rejection of its interests in the Sub.lease Agreement had no effect on Williams Associates' right to assume the role of sub.landlord. 4 WHEREFORE, Plaintiff Williams Associates requests that this Court deny Defendants' Motion for Summary Judgment and, further, that the Court deny all relief requested by Defendants in their Summary Judgment Motion. COUNT II Williams Associates v. John M. Sullivan. M.D. & Associates. LLC Uniust Enrichment an the AlterDlltive) 21. Plaintiff incorporates by reference its answers to Paragraphs I through 20 of Defendants' Motion for Summary Judgment. 22. Admitted in part and denied in part. Plaintiff admits that it has alternatively plead for damages in quantum meruit in the amount of$15,612.87. Williams Associates denies that the sum of $15,612.87 represents the amount of rent allegedly owed to it from the date that the Bankruptcy Court for the Northern District of Texas, Ft. Worth Division, granted Debtor's Motion to Reject All Leases to the date Defendant vacated the Leased Premises on October 29, 2001. By way offurther answer, the requested damages represent the amount of unpaid rent from July 1,2001 through October 29,2001. 23. Denied. Plaintiff denies the allegation that it has failed to produce any facts that would support a finding that the Defendant has been unjustly enriched during the time frame from July I, 200 I through October 29,2001. It is uncontroverted that Defendant Sullivan & Associates occupied the Leased Premises at the time and did not pay rent for its use of the Ll:ased Premises. 24. Denied. Williams Associates denies the allegation that PHB breached the Sub. Lease Agreement with Defendant, the allegation that Defendant provided l:ffective notice of the breach, and that both PHB and Plaintiff failed to cure the alleged breach. Williams Associates further denies the allegation the Defendants properly and justifiably terminated the Sub. lease Agreement. By way of further answer, Defendant Sullivan & Associates was not justified in seeking a termination of the 5 Sublease Agreement, Defendant did not properly or effectively provide Notice of Default, and Defendant did not properly or effectively terminate its sublease with PHB or the Sublease Agreement. 25. Denied. This Paragraph states a conclusion oflaw to which no answer is required. To the extent an answer is required, Plaintiff denies the allegation that the lmexpired leases associated with PHB were rejected through the bankruptcy proceedings, including the Prime Lease between Plaintiff and PHB and the Sublease Agreement between PHB and the Defendant. By way of further answer, PHB simply rejected its interest in the Sublease Agreement. Upon such rejection, Williams Associates was authorized by the Sublease Agreement to step into the shoes ofPHB as the sub.landlord. Williams Associates denies the allegation that Plaintiff has no authority to seek redress against Defendant. WHEREFORE, Plaintiff Williams Associates requests that this Court deny Defendants' Motion for Summary Judgment and, further, that the Court deny all relief requested by Defendants in their Summary Judgment Motion. COUNT III Williams Associates v. Cardinal TheraDies. :P.C. - TresDass 26. Plaintiff incorporates by reference its answers to Paragraphs I through 25 of Defendants' Motion for Summary Judgment. 27. Admitted in part and denied in part. Plaintiff admits that in Paragraphs 27 through 47 of its Complaint, it seeks damages against Defendants for an alleged trespass on and damage to property. Plaintiff further admits that in its Complaint it alleges that the trespass and damage occurred in the same building as the Leased Premises but allegedly did not constitute part of the Leased Premises. After further investigation and discovery, Plaintiff believes that Defendant Cardinal Therapies' alleged trespass occurred on the Leased Premises. By way of further answer, Defendant Cardinal Therapies occupied the Leased Premises as a sub.tenant without the required consent of the sub.landlord and prime landlord as required by Paragraph 7 of the Sublease Agreement. 6 28. Denied. Plaintiff denies that it has failed to prove any facts to support the finding that Defendant Cardinal Therapies, P.e. trespassed on the property and/or caused damages. By way of further answer, it is uncontroverted that Defendant Cardinal Therapies, P.C. occupied a portion of the Leased Premises without consent of the sub.landlord and prime landllord. 29. Admitted in part and denied in part. Plaintiff admits that Cardinal Therapies, P.C. occupied a potion of the Leased Premises. Williams Associates denies the allegation that Defendant Cardinal Therapies was rightfully on the property. By way offurther answer, Cardinal Therapies, P.C. wrongfully occupied a portion of the Leased Premises without the landlord's consent. WHEREFORE, Plaintiff Williams Associates requests that this Court deny Defendant Cardinal Therapies, P.C.'s Motion for Summary Judgment and, further, that the Court deny all relief requested by Defendants in their Summary Judgment Motion. COUNT IV Williams Associates v. John M. Sullivan - TresDass 30. Plaintiff incorporates by reference its answers to Paragraphs I through 29 of Defendants' Motion for Summary Judgment. 31. Admitted in part and denied in part. Plaintiff admits that in Paragraphs 48 through 59 of its Complaint, it seeks damages against Defendants for an alleged trespass on and damage to property. Plaintiff further admits that in its Complaint it alleges that the trespass and damage occurred in the same building as the Leased Premises but allegedly did not constitute part of the Leased Premises. After further investigation and discovery, Plaintiff believes that Defendant John M. Sullivan's alleged trespass occurred on the Leased Premises. By way of further answer, Defendant John M. Sullivan occupied the Leased Premises as a sub.tenant without the required consent of the sub.landlord and prime landlord as required by Paragraph 7 of the Sublease Agreement 7 32. Denied. Plaintiff denies that it has failed to prove any facts to support the finding that Defendant John M. Sullivan trespassed on the property and/or caust:d damages. By way of further answer, it is uncontroverted that Defendant John M. Sullivan occup:ied a portion of the Leased Premises without consent ofthe sub.landlord and prime landlord. 33. Admitted in part and denied in part. Plaintiff admits that John M. Sullivan occupied a potion of the Leased Premises. Williams Associates denies the allegation that Defendant John M. Sullivan was rightfully on the property. By way offurther answer, John M. Sullivan wrongfully occupied a portion ofthe Leased Premises without the landlord's consent. WHEREFORE, Plaintiff Williams Associates requests that this Court deny Defendant John M. Sullivan's Motion for Summary Judgment and, further, that the Court deny all relief requested by Defendants in their Summary Judgment Motion. COUNT V Williams Associates v. Cardinal Theraoies. P.C. .. Uniust Enrichment 34. Plaintiffiocorporates by reference its answers to Paragraphs I through 33 ofDefendaots' Motion for Summary Judgment. 35. Admitted in part and denied in part. Plaintiff admits that in Paragraphs 60 through 66 of its Complaint, it seeks damages for both the fair value of the unleased portion of property as well as the amount of money needed to restore said property to its unaltered condition. Plaintiff further admits that in its Complaint it alleges that the trespass and damage occurred in the same building as the Leased Premises but allegedly did not constitute part of the Leased Premises. After further investigation and discovery, Plaintiff believes that Defendant Cardinal Therapies' alleged trespass occurred on the Leased Premises. By way of further answer, Defendant Cardinal Therapies occupied the Leased Premises as a sub.tenant without the required consent of the sub.landlord and prime landlord as required by Paragraph 7 of the Sublease Agreement. 8 36. Denied. Plaintiff denies that it has failed to prove any facts to support the finding that Defendant Cardinal Therapies, P.C. trespassed on the property and/or caused damages. By way of further answer, it is uncontroverted that Defendant Cardinal Therapies, P .C. occupied a portion of the Leased Premises without consent of the sub.landlord and prime landlord. 37. Admitted in part and denied in part. Plaintiff admits that Cardinal Therapies, P.C. occupied a potion of the Leased Premises. Williams Associates denies the allegation that Defendant Cardinal Therapies was rightfully on the property. By way of further answer, Cardinal Therapies, P.C. wrongfully occupied a portion of the Leased Premises without the landlord's consent. WHEREFORE, Plaintiff Williams Associates requests that this Court deny Defendant Cardinal Therapies, P.C.'s Motion for Summary Judgment and, further, that the Court deny all relief requested by Defendants in their Summary Judgment Motion. COUNT VI Williams Associates v. John M. Sullivan - Uniiust Enrichment 38. Plaintiff incorporates by reference its answers to Paragraphs I through 37 of Defendants' Motion for Summary Judgment. 39. Admitted in part and denied in part. Plaintiff admits that in Paragraphs 67 through 73 of its Complaint, it seeks damages against Defendants for both the fair value of the unleased portion of property as well as the amount of money needed to restore said property to its unaltered condition. After further investigation and discovery, Plaintiff believes that Defendant John M. Sullivan's alleged trespass occurred on the Leased Premises. By way of further answer, Defendant John M. Sullivan occupied the Leased Premises as a sub.tenant without the required consent of the sub.landlord and prime landlord as required by Paragraph 7 of the Sublease Agreement 40. Denied. Plaintiff denies that it has failed to prove any facts to support the finding that Defendant John M. Sullivan trespassed on the property and/or caus(,d damages. By way of further 9 answer, it is uncontroverted that Defendant John M. Sullivan occupi<:d a portion of the Leased Premises without consent of the sub.landlord and prime landlord. 41. Admitted in part and denied in part. Plaintiff admits that John M. Sullivan occupied a potion of the Leased Premises. Williams As~ociates denies the allegation that Defendant John M. Sullivan was rightfully on the property. By way of further answer, John M. Sullivan wrongfully occupied a portion of the Leased Premises without the landlord's consent. 42. Denied. Plaintiff denies that all necessary discovery by both parties has occurred. Plaintiff further denies that there is no genuine issue of any material fact to any necessary element of the cause of actions that Plaintiff has alleged. Finally, Plaintiff denies the allegation that there are no disputed facts that would support a cause of action against the Defendants. 43. Denied. Plaintiff denies the allegation that the facts establish that Defendants properly followed the terms and conditions of the Sublease Agreement, that Defendants properly exercised their right to terminate the Sublease Agreement, that PHB defaulted, and that Defendants acted only after proper notice and the rejection of the unexpired leases through the bankruptcy proceedings. By way of further answer, Defendants' actions were premature, unjustified, and legally ineffective. Moreover, it is undisputed that Defendants vacated the Leased Premises and have not made the payments through the expiration of the agreed lease term. 44. Denied. Plaintiff denies the allegation that Williams Associates lack standing to sue the Defendants under the causes of action enumerated in its Complaint on the basis that there is no alleged privity between Plaintiff and Defendants. It is undisputed that Plaintiff and Defendants both signed the Sublease Agreement and, accordingly, entered into a contract regarding the Leased Premises. Williams Associates denies the allegation that it is an improper party to seek redressability [sic] of its alleged injuries. Finally, Williams Associates denies the allegation that the Prime Lease between Plaintiff and PHB and the Sublease Agreement between PHB and the Defendant was rejected by the Trustee in 10 bankruptcy prior to the Defendants allegedly terminating the sublease. By way of further answer, PHB, as debtor.in.possession, rejected its interest in the Sublease Agreement. Pursuant to the terms of that Agreement, Williams Associates duly exercised its right to assume the role of the sub.landlordand demand full performance by Defendant Sullivan. It is undisputed that Defendant Sullivan has not performed its obligation to continue to occupy the Leased Premises and to continue to pay rent during the duration of the sublease term. WHEREFORE, Plaintiff Williams Associates requests that this Court deny Defendant John M. Sullivan's Motion for Summary Judgment and, further, that the Comt deny all relief requested by Defendants in their Summary Judgment Motion. Respectfully submitted, ~~~ Markian R. Slobodian, Esquire ID No. 41075 Andrew R. Eisemann, Esquire ID No. 874H 801 North Second Street Harrisburg, P A 171 02 717/232-5180 Dated: ~ \ \:1\-:>'\ Michael L. Solomon, Esquire ID No. 36031 212 Locust Street, Suite 500 Harrisburg, PA 17101 717/255.7600 Counsel for Williams Associates 11 CERTIFICATE OF SERVICE: I hereby certify that I have this date, mailed a true and correet copy of the foregoing Response by United States mail, first.class, postage prepaid, addressed to the following individual(s): Peter M. Good, Esquire Smigel, Anderson & Sacks 2917 North Front Street Harrisburg, P A 17110.1260 Michael L. Solomon, Esq. 212 Locust Street, Suite 500 Harrisburg, PA 17101 NL~tp ~ ~I'_ l"3/'i)~ 'I n "., {,:':".> ::= 7"t-. -'-~' w <) c.~ c::: C) " :-.1 i-h"::, ,- ''', rn -J L:;; (.J PRAECIPE FOR LISTING CASE FOR ARGUMENT (Must be typewritten and suhnitted in duplicate) TO THE PROTHONOTARY OF CUMBERLAND COUNTY: Please list the within matter for the next ArgUnent Court. --------------------------------------------------------------------------------------- CAPTION OF CASE (entiIe caption must be stated in full) WILLIAMS ASSOCIATES ( plaintiff) vs. JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL 'lliERAPIFS, P.C. & JOHN M. SULLIVJIN ( oeferrlant) No. 01-6201 Civil LAW lpj 2001 1. state matter to be argued (Le., plaintiff's rootion for new trial. deferrlant's darurrer to ccnplaint. etc.): SUIlIl1arY Judgment 2. Identify =unse11Obo will argue case: (b) for deferrlant: Address: Martian R. Slob:>dian, Esquire Law offices of MarlcLan R. Slob:>dian 801 N. Second st. Harrisburg, PA 17102 Peter M. Good, Esqui.re; Susan M. zeamer, Esquire smigel, Anderson & Sacks, LLP 4431 N. Front st. Harrisburg, PA 17110 (a) for plaintiff: Address : 3. I will notify all parties in writing within two days that this case has been listed for argunent. 4. Arg\.I1leIlt Court Date: June 9, 2004 Dated: ~~c.~~~ / 1\ 1?orney for ~-{~,,\-;) "-...( , .~.~ o :::--: s ....., = = .c- o "Tl :::! n~:n ,. .:.n;S'6" ~-... '~( --1-1,. ;r;-rj :c-}.C) ~~m '.'::>0 ~b '< - J;!... -< f'" Cl ~-" -:.i.. '2 Ul \D DEBORAH C, KENNEDY-MARKLE IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA V. RONALD SCOTT MARKLE : NO. 2001-6314 CIVIL TERM CIVIL ACTION - DIVORCE ORDER OF COURT AND NOW, this 4TH day of JUNE, 2004, after review of the record we can find no evidence that notice of Defendant's intention to request f:ntry of a divorce decree was served upon Plaintiffs attorney of record as required by Pa. R.C.P. 1920.42(d)(1). Therefore, Defendant's request for the entry of a divorce decree is DENIED without prejudice. Edward E. Guido, J. ~e1 J. Hanft, Esquire 19 Brookwood Avenue Carlisle, Pa. 17013 ~ald Scott Markle 85 Greenview Street Carlisle, Pa. 17013 > :sld ).JJ\lriCY'-: ':'~~;?~nJ zz : \ \ I,J,'J 1]- 1m! ~GOZ AtI"7'.lJJ;\lU;-U"Gdd '3Hl jO 3C)\~::!O,-{l3lH WILLIAMS ASSOCIATES, Plaintiff : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PENNSYLVANIA v. : NO. 01-6201- Civil Term JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.c., and JOHN M. SULLIVAN, Defendants PRAECIPE TO AlT ACH VERIFICATION TO PETITION FOR RULE TO AMEND COMPLAINT TO THE PROTHONOTARY OF CUMBERLAND COUNTY. Please attach the signed Verification to the Petition for Rule to Amend Complaint in the above.referenced case. LAW OFFICES OF MARKIAN R. SLOBODIAN By ~ 'f/,--- MARKIAN R. SLOBODIAN, ESQ. ID No. 41075 ANDREW R. EISEMANN, ESQ. ID No. 874141 801 North Second Street Harrisburg, PA 17102 (717) 232-5180 Attorneys for Williams Associates Dated: , l 5'10 "\ VERIFICATION I, JACK SOLOMON, hereby verify that the facts contained in the foregoing pleading are true and correct to the best of my knowledge, information and belief. I understand that false statements herein are subject to the penalties of 18 Pa. C.SA S 4904 relating to unsworn falsification to authorities. rz~mfjf7>>t ~ DATE: ~>-.l( 8 ,2004 CERTIFICATE OF SERVICE I hereby certify that I have, this date, served a true and correct copy of the foregoing Praecipe via facsimile, to the following individual(s): Peter M. Good, Esq. 717/234-3611 : c<JJ~ {L..reI KAREN L. HAY CA OLL Dated:~, 9.'o-t [ ...0 CO ~ (-:: '..'-:' ..,.-- , t.J.") , , y~'( o -n --4 ~~:n \,,\-- -'nt-I.:' --J L._ (:~~(> ~~-~, ~2 (;:":) c...) <.D Y' .:-\ -~':' WILLIAMS ASSOCIATES, Plaintiff : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PA ~ JUN v 9 2004 o v. : CIVIL ACTION - LAW JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.c. & JOHN M. SULLIVAN, : NO. 01-6201- Civil Term Defendants RULE TO SHOW CAUSE AND NOW, this ~o day of June 2004 on Petition of The Law Offices of Markian R. Slobodian, counsel for Plaintiff Williams Associates, a Rule is entered on Defendants John M. Sullivan, M.D. & Associates, LLC, Card.inal Therapies, P.e. & John M. Sullivan to show cause why their Complaint in the above-relferenced case should not be amended as follows: (a) Amend Paragraphs 38 and 49 of the Complaint to state, "During the period commencing February 1, 2001 and continuing through on or about October 29, 2001, Defendant Cardinal Therapies, P.e. occupied certain premises consisting of approximately four hundred (400) square feet in the Leased Premises (the "Unauthorized Premises")."; (b) Amend Paragraphs 44 and 55 of the Complaint to state that "Defendants' occupation of the Unauthorized Premises has caused Williams Associates to incur damages in the amount of $1,933.33 for unpaid rent based on the fair rental value of the premises of $14.50 per square foot."; (c) Amend Paragraphs 63 and 70 of the Complaint to state that "the fair market rental value for the Unauthorized Premises calculated at the rate of $14,50 per square foot is $1,933.33."; and (d) Reduce the amount of damages stated in the Wherefore clauses for Counts III, N,v,andVlbythesumOI8'~~~/,) c4- ~~ Returnable on - ~ Judge / rff 'r,!;h:,;:,'..\l) .,~>.t,r~ ,:-\ )\.li\!,~:C!'"' . ./>:i18 all : m,i~ 0 I HnnDOZ 1-,::::;,'v",U>JUr-l108d 3Hl :10 ~;~~l;-\::'O-G:nl:l WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA v. No. 01.6201 CIVIL TERM JOHN M, SULLIVAN, M.D. & ASSOCIATES,LLC,CAllDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, DEFENDANTS CIVIL ACTION - LAW Defendants' Response in Opposition to Plaintiff's Petition for Rule to Amend Complaint AND NOW COMES, Defendants John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.C. and John M. Sullivan (collectively "the Defendants"), by and through their counsel Smigel, Anderson & Sacks, LLP, who file this response in opposition to Plaintiff's Petition for Rule to Amend Complaint for the reasons that follow: 1. Admitted. 2. Admitted as stated. 3. Admitted as stated. Upon information and belief, based upon Plaintiffs statements at deposition and to this Court through their Response to the Defendant's Motion for Summary Judgment and in the present petition, the Defendants admit the averments contained in paragraph 3 of Plaintiff's Petition. 4. Denied. Paragraph 4 of Plaintiffs Petition eontains conclusions oflaw to which no responsive pleading is required. To the extent a response may be required, and without waiving the above, it is denied that the Leased Premises was subleased by John M. Sullivan. M.D. & Associates, LLC. It is further denied that any "occupation" that may have occurred by John M. Sullivan and/or Cardinal Therapies, P .C. had an effect upon Plaintiff as John M. Sullivan, Cardinal Therapies, P.C. and John M. Sullivan, M.D. & Associates, LLC are all one in the same as John M. Sullivan as an individual was and is the sole owner of Cardinal Therapies, P.C. and John M. Sullivan, M,D. & Associates. Moreover, John M. Sullivan was the signator on the Sublease in question for John M. Sullivan, M.D. & Associates. 5. Admitted as stated. By way of further answer, in its response to the Defendants' Motion for Summary Judgment, Plaintiff has not only attempted to correct its prior error but has added a new cause of action for unlawful occupation of the Leased Premises, See Plaintiffs Response to Defendants' Motion for Summary Judgment. 6. Denied. The Defendants have denied the averments in question originally made by Plaintiff since refilling of its Answer with New Matter and Counterclaim was filed. By way of further answer, the Defendants were not aware of Plaintiff s admission to the incorrect statements of fact in their Complaint until the date of depositions, or February 11, 2004. 7. Admitted as stated. 8. Denied. Although no responsive pleading is required to this allegation, it is specifically denied that the referenced Defendants "occupied" unauthorized premises. Further, how such alleged occupation was unauthorized is wldefined. Strict proof at the time of trial, if admissible, is demanded. 9. Denied. Although no responsive pleading is Jrequired to this allegation, it is specifically denied that the referenced Defendants "occupied" unauthorized premises. Further, how such alleged occupation was unauthorized is undefined. Strict proof at the time of trial, if admissible, is demanded. 2 II ',I. 10. Denied. Although responsive pleading is required, it is specifically denied that any action by the Defendants caused Plaintiff to incur damages. Such an averment is a conclusion oflaw to which no responsive pleading is required. Moreover, Plaintiffs proposed amendment continues to refer to the Leased Property as the "Unauthorized Premises". Further, how such alleged occupation was unauthorized is undefined. Strict proof at the time of trial, if admissible, is demanded. 11. Denied. Although responsive pleading is required, it is specifically denied that the fair market rental value for the Leased Premises is equal to $14.50 per square foot and strict proof at the time of trial, if admissible, is demanded. Moreover, Plaintiffs proposed amendment continues to refer to the Leased Property as the "Unauthorized Premises" . 12. Denied. Although responsive pleading is required, Defendants specifically deny that Plaintiff incurred any damages as a direct result of any of the Defendants actions. Strict proof at the time of trial, if admissible, is demanded. 13. Denied. The averments contained in paragraph 13 of Plaintiffs Petition contain conclusions of law to which no responsive pleading is required. The averments are therefore denied. 14. Denied. The averments contained in paragraph 14 of Plaintiff s Petition contain conclusions of law to which no responsive pleading is required. The averments are therefore denied. 15. Denied. The averments contained in paragraph 15 of Plaintiff s Petition contain conclusions of law to which no responsive pleading is required. The averments are therefore denied. 3 ". 16. Denied. The averments contained in paragraph 16 of Plaintiffs Petition contain conclusions oflaw to which no responsive pleading is required. The averments are therefore denied. 17. Denied, Defendants cited to Vierner v. Jacobs, 834 A.2d 566 (Pa. Super. 2003) in its Motion for Summary Judgment, not in response to a request or petition to amend Plaintiffs Complaint. Plaintiff was seeking, through its response to Defendants' Motion for Summary Judgment, to effectively amend its Complaint through said response, as opposed to specifically petitioning the Court for permission to do so. Plaintiff, by such action, was (and is, as the Motion for Summary Judgment remains pending) attempting to have the Court consider the Motion as if the Complaint had already been amended, not on the pleading that currently stands before this Court. To that end, Defendants relied upon Vierner. 18. Denied. The averments contained in paragraph 18 of Plaintiffs Petition contain conclusions oflaw to which no responsive pleading is required. Therefore, the averments are denied. 19. Denied, The averments contained in paragraph 18 of Plaintiff's Petition contain conclusions oflaw to which no responsive pleading is required. Therefore, the averments are denied. 4 II" I WHEREFORE, Defendants request that this Honorable Court deny Plaintiff's Petition for Rule to Amend Complaint. In the alternative, Defendants respectfully request that this Honorable Court stay Plaintiffs petition until after disposition of the pending Motion for Summary Judgment, argument for which was heard on June 9, 2004, D"~1" '. Mr-..l. \ ~ . J(jJv " , { ~I SMIGE][', ANDERSON & SACKS ^ c----. ~M'~Od, ' \J ~::l Zeamer, Es 4431 North Front et Harrisburg, P A 1711 0.1709 (717) 234-2401 Attomeys for Defendants 5 WILLIAMS ASSOCIATES, PLAINTIFF IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYL VANIA v. JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CAJUDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, No, 01.6201 CIVIL TERM DEFENDANTS CIVIL ACTION - LAW CERTIFICATE OF SERVICE I, Susan M. Zeamer, Esquire, attorney for Defendants !in the above-captioned matter, do hereby certify that I served a true and correct copy of the Defendants' Response in Opposition to Plaintiff's Petition for Rule to Amend Complaint on counsel for the Plaintiff by depositing same in the U.S, Mail, on June 14,2004, postage prepaid for first class mail, addressed as follows: MARKIAN R. SLOBODIAN, ESQUIRE 801 NORTH SECOND STREET P.O. BOX 11967 HARRISBURG, PA 17108-1967 MICHAEL L. SOLOMON, ESQUIRE 212 LOCUST STREET, STE. 500 HARRISBURG,PA 17101 Da~lj)o.~, ILl! "i(j"~ SMIGEL, ANDE ~'-',,,,,"-fv..... ~-eter M. Good, uire# 64316 Susan Zeamer, uire# 82023 4431 North Front Street Harrisburg, P A 1711 0.1709 (71 7) 234.240 I Attorneys for Defendants (") ,..., ~ c:;:.:) (..:: 5F :r'Tl "'0 t~~: <..- ,'-'C", c~: nll'P , ;;0<:: :g~ V) .s:- O ~:. "-1 (_:: ''--~ _'r".' , ;:--. -0 ~~.t~ ( -,- ~ ~~I-n -' <.::) C~, )c,. ~-~? "j> \"'..,) ~D ._; :.< -< 0) WILLIAMS ASSOCIATES, Plaintiff :IN THE COURT OF COMMON PLEAS :CUMBERLAND COUNTY v. JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.C. & JOHN M. SULLIVAN, :CIVIL ACTION - LAW :NO. 01-6201 - Civil Term Defendants CERTIFICATE OF SERVICE REGARDING RULE TO SHOW CAUSE I hereby certifY that I have, this date, served a true and correct copy of the attached Rule via U.S. fIrst class mail, postage paid, to the following individual(s): Peter M. Good, Esq. Smigel, Anderson & Sacks, LLP River Chase OffIce Center, 3nl Floor 4431 North Front Street Harrisburg, PA 17110.1709 Respectfully submitted, THE LAW OFFICES OF MARKIAN R. SLOBODIAN Dated: {, I, ~ I b 'i ~~- MARKIAN R. SLOBODIAN, ESQ. ANDREW R. EISEMANN, ESQ. 80 I North Second Street Harrisburg, P A 17102 717/232-5180 Counsel for Williams Associates WILLIAMS ASSOCIATES, Plaintiff : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PA JUN u 9 z004 c v. JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.e. & JOHN M. SULLIVAN, : CIVIL ACTION - LAW : NO. 01-6201- Civil Term Defendants RULE TO SHOW CAUSE AND NOW, this /0 day of June 2004 on P,etition of The Law Offices of Markian R. Slobodian, counsel for Plaintiff Williams Associates, a Ru1e is entered on Defendants John M. Sullivan, M.D. & Associates, LLC, Cardinal Therapies, P.c. & John M, Sullivan to show cause why their Complaint in the above-referenced case should not be amended as follows: (a) Amend Paragraphs 38 and 49 of the Complaint to state, "During the period commencing February 1, 2001 and continuing through on or about October 29, 2001, Defendant Cardinal Therapies, P.c. occupied certain premis'2s consisting of approximately four hundred (400) square feet in the Leased Premises (the "Unauthorized Premises")."; (b) Amend Paragraphs 44 and 55 of the Complaint to state that "Defendants' Occupation of the Unauthorized Premises has caused Williams Associates to incur damages in the amount of $1,933.33 for unpaid rent based on the fair rental value of the premises of $14.50 per square foot."; (c) Amend Paragraphs 63 and 70 of the Complaint to state that "the fair market rental value for the Unauthorized Premises calculated at the rate of $14.50 per square foot is $1,933.33."; and (d) Reduce the amount of damages stated in the Wherefore clauses for Counts III, IV, V, and VI by the sum of $2f066'ib ..t1 /11 jf) +) ~ Returnable on J UJ.,,, 2fJ6i.'::;-O BY THE COURT: WILLIAMS ASSOCIATES, Plaintiff : IN THE COURT OF COMMON PLEAS : CUMBERLAND COUNTY, PA v. JOHN M. SULLIVAN, M.D. &: ASSOCIATES, LLC, CARDINAL THERAPIES, P.e. &: JOHN M. SULLIVAN, : CIVIL ACfION - LAW : NO. 01-6201- Civil Term Defendants PETITION FOR RULE TO AMEND COMPLAINT o c-- "-' fj; ~, :"..; --. '- -.-- fi-j,-'.: :'~ CJ I NOW COMES, Plaintiff Williams Associates, by its counsel, The Law O{flces or' =} Markian R. Slobodian, and files this Petition for Rule to Amend its Complaint to' correcUwo '," erroneously stated factual averments in Counts III, N, V, and VI: -, (Jl C) }, The Petitioner is the Plaintiff in the above-referenced action. 2. Plaintiff's Complaint alleges in Counts III, N, V, and VI that Defendants Cardinal Therapies, P.c. and John M. Sullivan occupied certain premises consisting of approximately 400 sq. ft. in the same building as the Leased Premises, but not constituting part of the Leased Premises (the "Unauthorized Premises"). 3. After further investigation, Plaintiffs now believe the averment that Defendants occupied a part not constituting the Leased Premises to be an incorrect statement of the facts. 4. Defendants John M. Sullivan and Cardinal Therapies, P.c. actually occupied a part of the premises leased to Defendant John M. Sullivan, M.D. &: Associates, LLC. 5. Counsel for Williams Associates notified Defendants regarding the incorrect statement of fact during discovery and in its Response to Deflmdants' Motion for Summary Judgment. 6. Counsel for Defendants has been aware of the said incorrect statement of fact related to the "Unauthorized Premises" since February 2004. 7. Defendants have always known: exactly what portion of the building they occupied. 8. Plaintiff seeks leave to amend Paragraphs 38 and 49 of the Complaint to state "During the period commencing February 1, 2001 and continuing through on or about October 29, 2001, Defendant Cardinal Therapies, P.c. (Or Defendant John M. Sullivan respectively) occupied certain premises consisting of approximately four hundred (400) square feet in the Leased Premises (the "Unauthorized Premises")." 9. In addition, the amount of alleged damages for four months of unpaid rent from Defendants John M. Sullivan and Cardinal Therapies, P.c. in Counts III, N, V, and VI were incorrectly calculated and should be reduced. 10, Plaintiff seeks to amend Paragraphs 44 and 55 of the Complaint to indicate that Defendants' occupation of the Unauthorized Premises has caused Williams Associates to incur damages in the amount of $1,933.33 for unpaid rent based on the fair rental value of the premises of $14.50 per square foot. 11. Plaintiff further seeks to amend Paragraphs 63 and 70 of the Complaint to state that the fair market rental value for the Unauthorized Premises calculated at the rate of $14.50 per square foot is $1,933.33. 12. Finally, Plaintiff seeks to reduce the amount of damages stated in the Wherefore clauses for Counts III, N, V, and VI by the sum of $2,066.67. 2 Legal Analysis of Application of Pewlsylvania Rule Allowing Amendments to Complaint 13. Under Pennsylvania case law, amendments to complaints have been liberally permitted by trial courts, See Lutz v. Springettsbury Twp., 667 A.2d 251 (pa. Commw. Ct 1995) (holding that amendments to complaints should be freely allowed and that claims should not be jeopardized by minor defects in the pleading,); see also Werner v. Zazyczny, 681 A.2d 1331 (Pa. 1996) (holding that the right to amend should be liberally granted at any stage of proceedings). 14. Generally, under Pennsylvania case law an amendment of a complaint that will facilitate a trial upon the merits is allowed wherever: (1) the justice of the case requires an amendment; and (2) no injury is thereby inflicted on the adverse party. See Bata v. Central- Penn Nat, Bank of Philadelphia, 293 A.2d 343 (Pa.1972). 15. Under Pennsylvania case law, however, an amendment should not be allowed where it will present an entirely new cause of action or unfairly surprise or prejudice an opposing party. See Sejpal v. Corson, Mitchell, Tomhave & McKinley, N.D.'s, Inc., 665 A.2d 1198 (Pa, Super. Ct. 1995); see also Carpitella v. Consolidated Ruil Corp., 533 A.2d 762 (Pa. Super. Ct. 1987) (holding that amendments should be allowed in any stage of the adversary process to secure a decision of the case on its merits, unless unfair surprise or prejudice to the other party would result.); see also Connor v. Allegheny General Hasp., 461 A.2d 600 (Pa, 1983) (holding that an amendment of a complaint will not be allowed if it will cause prejudice or surprise to the adverse party.) 16. To be prejudicial, an amendment must compromise the opposing party's -' ability to present its case. See City of Philadelphia v. Spencer, 59'1 A.2d 5 (pa. Commw. Ct. 3 1991). In assessing whether an amendment will cause prejudice, the court will consider the time when the amendment is offered, see Capobianchi v. BIC COrp'f 666 A.2d 344 (pa. Super. Ct. 1995), however, it is inappropriate to rely solely on "delay" to determine whether an amendment is proper. See Brooks v. McMenamin, 503 A.2d 446 (pa. Super. Ct. 1986); see also Borough of Mifflinberg v. Heim, 705 A.2d 456 (Pa. Super. Ct. 1997) (holding that a party must establish more than undue delay to overcome the liberal policy governing the amendment of pleadings.). 17. Defendants cite the case Vierner v. Jacobs, 834 A.2d 546 (pa, Super. Ct. 2003) as authority that this Court should not allow Williams Associates to amend its Complaint to correct an erroneously stated factual issue. (Defs.' Br. in Supp. of Defs.' Mot. for Summ. J. at page 8.) 18. The facts of the Vierner case can be easily distinguished from the case presently before this Court. In Vierner, the defendant attempted to aml~nd his Answer several months following the end of the liability phase of a bi-furcated trial. ld. at 560. The parties had already commenced the second phase to determine damages when the defendant attempted to amend his Answer. ld. The court held that the defendant's failure to amend his Answer left the plaintiff unprepared to defend himself against new allegations contained in the defendant's Motion to Amend. ld. Furthermore, the Vierner court observed that the plaintiff's property interests were being administered by the U.S. Bankruptcy Trustee and that the trial court was without jurisdiction to consider defendant's new claim. ld. 19. In the present case, the Defendant is not subject to undue prejudice or surprise for the following reasons: (1) William Associates is attempting to correct an erroneously .,.. 4 stated issue of fact, rather than add a new allegation; (2) OJunsel for Williams Associates informed Defendants of the factual error before and durinl~ depositions in February 2004, and Williams Associates repeated the correction in its Response to Defendants' Motion for Summary Judgment; (3) Williams Associates is amending its Complaint during and as a result of formal discovery. This case is not yet near trial, a Itrial has not yet been rescheduled, and this Court's Scheduling Order has been rescinded because Defendants, not Plaintiff, filed the instant Motion for Summary Judgment; and (4) The fact, as amended, that Defendants were actually occupying Leased Premises, rather than a part not constituting the Leased Premises, does not present any new cause of action and does not compromise Defendants' ability to present their case. WHEREFORE, Petitioner prays leave to amend its Complaint by amending the Complaint as follows: (a) Amend Paragraphs 38 and 49 of the Complaint to state, "During the period commencing February 1, 2001 and continuing through on or about October 29, 2001, Defendant Cardinal Therapies, P.e. occupied certain premises consisting of approximately four hundred (400) square feet in the Leased Premises (the "Unauthorized Premises")."; and (b) Amend Paragraphs 44 and 55 of the Complaint to state that "Defendants' occupation of the Unauthorized Premises has caused Williams Associates to incur damages in the amount of $1,933.33 for unpaid rent based on the fair rental value of the prem~es of $14.50 per square foot."; 5 (c) Amend Paragraphs 63 and 70 of the Complaint to state that "the fair market rental value for the Unauthorized Premises calculated at Ithe rate of $14.50 per square foot is $1,933.33."; and (d) Reduce the amount of damages stated in the Wherefore clauses for Counts ill, IV, V, and VI by the sum of $2,066.67. Respectfully submitted, LAW OFFICES of MARKIAN R. SLOBODIAN ~--1~ MARKIAN R. SLOBODIAN, ESQ. I.D. No. 41075 ANDREW R. EISEMANN, ESQ. I.D. No. 87441 801 North Second Street Harrisburg, PA 17102 717/232-5180 Dated: ,{ 4. \0,,\ MICHAEL L. SOLOMON, ESQ. ID No. 36031 212 Locust Street, Suite 500 Harrisburg, PA 17101 Counsel for Williams Associates, Plaintiff 6 CERTIFICATE OF SERVICE I, Markian R. Slobodian, hereby certify that I hav<e this date, mailed a true and correct copy of the foregoing Petition by United States mail, first-class, postage prepaid, addressed to the following individual(s): LeRoy Smigel, Esquire Smigel, Anderson & Sacks 2917 North Front Street Harrisburg, PA 17110-1260 Dated: ,\ ~ \ 0,\ /"';)' \A.. k MARKIAN R. SLOBODIAN, ESQ. 7 ".'fl (') c ..... CJ = .<-- <- c::: ....,;.. d~ ""-. o -n .-j :r:-rl fnp ~g9 ;~C) ~I: :::fi !iF~ C:-;' ;;~: (.n -0 ::K r~) 0:> ~~ WILLIAMS ASSOCIATES, Plaintiff vs. IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW 01-6201 CIVIL JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.c. & JOHN M. SULLIVAN, Defendants IN RE: DEFENDANTS' MOTION FOR SUMMARY JUDGMENT BEFORE BAYLEY AND HESS, J.J. ORDER AND NOW, this Z -:! day of August, 2004, it apperuring that this case presents genuine issues of material fact and it appearing, also, that there is pending a motion to amend the plaintiffs complaint, the motion of the defendants for summary judgment is DENIED. BY THE COURT, vM'arkian R. Slobodian, Esquire For the Plaintiff ./(J;J Peter M. Good, Esquire > ~usan M. Zeamer, Esquire For the Defendants :rlm Ogo -03 0 I r cO' i:'~; ~ uJ';,:,~ C)'~''::, rc ~y'~ !..i-""'~ C)r-~~ 2:.,0 L". Wfs:. duJ tJ-'J,: ,- u,. o \f) ,,,, 0' ",,:0- ",:;- ;..a: C'} \ c.D ::::> .,z -'" = ~ t: / ;iii 'i'~~ .:~\~:2, ~:,!.~:~\t :5 o WILLIAMS ASSOCIATES, Plaintiff itt~~~ITiI : IN THE COURT OF COMMON PLEAS )''&)3 - I - L : CUMBERLAND COUNTY, PENNSYLVANIA v. : NO. 01-6201 - Civil Term JOHN M. SULLIVAN, M.D. & ASSOCIATES, LLC, CARDINAL THERAPIES, P.c., and JOHN M. SULLIV AN, Defendants JOINT PRAECIPE TO DISMISS COMPLAINT, NEW MATTER, and COUNTER CLAIM WITH PREJUDICE TO THE PROTHONOTARY OF CUMBERLAND COUNTY. Please mark the Complaint, New Matter, and Counter Claim filed by the respective parties in the above-referenced case as Dismissed With Prejudice. Respectfully submitted, LA W OFFICES OF MARKIAN R. SLOBODIAN By ~A,^-- MARKIAN R. SLOBODIAN, ESQ. ID No. 41075 ANDREW R. EISEMANN, ESQ. ID No. 87441 801 North Second Street Harrisburg, PA 17102 (717) 232-5180 Attorneys for Williams Associates, Plaintiff SMIGEL, ANDERSON & SACKS, LLP By ~ Dated: 9-11 -06 PETER M. GOOD, ESQ. ID #64316 Smigel, Anderson & Sacks 2917 North Front Street Harrisburg, PA 17112-1260 Counsel for John M. Sullivan, M.D. & Assoc., LLC, Cardinal Therapies, PC, and John M. Sullivant, Defendants .--1 ('0 r',,,~ '~-:'"':I