COURT OF CHANCERY
OF THE
STATE OF DELAWARE

SAM GLASSCOCK lll

VICE CHANCELLOR 34 THE CIRCLE

GEORGETOWN, DELAWARE 19947

Date Submitted: June 9, 2015
Date Decided: June 11, 2015

Richard L. Abbott, Esquire
Abbott Law Firm LLC

724 Yorklyn Road, Suite 240
Hockessin, DE 19707

David J. Weidman, Esquire
Sergovic, Carmean &Weidman, PA.
142 East Market Street

Georgetown, DE 19947

RefEi Seabreeze Homeowners Association, Inc. v. Marshall Jenney, et

a].
Civil Action No. 863 5-VCG

Dear Counsel:

In 2011, the homeowners’ association of Seabreeze subdivision sued the
Respondent, Marshall Jenney, in an attempt to force him to remove vegetation
which it asserted was growing in violation of deed restrictions on the Jenney
property. The property consists of two lots, a bay-front parcel and the adjacent
inland parcel in a subdivision, Seabreeze, fronting Rehoboth Bay near Dewey
Beach. Jenney settled that litigation on December 21, 2012 by agreeing

contractually to trim the foliage on his properties (the “Settlement Agreement”),

but, allegedly, Jenney failed to comply with the Settlement Agreement. On June

COURT OF CHANCERY COURTHOUSE

 

 

11, 2013, the Petitioner, Seabreeze Homeowners Association, Inc.] (the
“Homeowners”) ﬁled this action to speciﬁcally enforce the Settlement Agreement»;
This enforcement action, in turn, was settled by Jenney’s entry into a consent
stipulation that was entered as an Order of the Court on July 11, 2014 (“Stipulation
and Order”), again requiring Jenney to trim his foliage, with the work to be
completed by October 31, 2014. Since that time, this litigation has involved an
ongoing effort by the Petitioner to enforce the terms of that Stipulation and Order.
Remaining at issue is the trimming of foliage on the bay-front parcel.
Notwithstanding the rather limited nature of this case, it has become the most
actively litigated on my docket.

Currently before me is a request by Jenney and his wife, Erin C. Jenney,
recently added as a party respondent, for a stay of my June 1, 2015 Order directing
that the Respondents comply with the Stipulation and Order by trimming the
foliage in question by June 30, 2015. This Order implemented rulings made on
May 21, 2015, following a site visit with a court reporter and arborist, at which the

parties agreed on the extent of the trimming necessary to comply with the

 

1 According to the Respondents, this entity is not the same homeowners’ association that brought
the initial action.

 

 

Stipulation and Order. The stay is sought in light of an appeal of various Court
orders in this matter to our Supreme Court.2

Both parties rely on the four factor test for consideration of such a stay set
out in D.F. Rich Company v. Gray.3 Those factors are (1) the perceived likelihood
of success on appeal, (2) whether the movant faces irreparable harm absent a stay,
(3) the harm to other interested parties should the stay be granted, and (4) whether
the stay is in the public interest. I evaluate this matter under those factors as
follows.

I ﬁrst consider the likelihood of success on appeal. The issues presented on
appeal are difﬁcult to glean from the Notice of Appeal ﬁled by the Respondents.
As I understand the appeal, it appears that only the Jenneys’ argument that I
improperly denied a Rule 60 Motion to Vacate has any bearing on the action this
Court has directed the Respondents to take by June 30, 2015: the trimming of the
foliage.4 The Motion to Vacate involved whether the Stipulation and Order,

entered by Mr. Jenney with the advice of counsel, is enforceable; the Jenneys

 

_=.='T~ '—.

2 The addition of Mrs. Jenney as a party respondent is one of my Orders currently on appeal.
That Order was the result of an attempt by J enney to avoid the foliage trimming called for in the
Stipulation and Order by a sham transfer of the property in question to Mrs. J enney, his wife.

3 2006 WL 3872830 (Del. Ch. Dec. 15, 2006).

4 As noted, one of the Orders on appeal involves my grant of the Homeowners’ motion to join
Mrs. Jenney. That Order was entered after Mr. Jenney undertook a transfer of the properties in
question to Mrs. Jenney in an attempt to avoid the Stipulation and Order. She is now a record
owner of the property that the Homeowners seek to have trimmed in vindication of the
Settlement Agreement and the Stipulation and Order. I ﬁnd it unlikely that the appeal of that
Order bears on the trimming work to be completed by June 30, but, in any event, it is unclear to
me on what grounds the joinder of Mrs. Jenney could be found improper under Court of
Chancery Rule 19, and this issue, in my view, is unlikely to ﬁnd success on appeal.

contend, on various grounds, that it is not. This argument, in my estimation, is
unlikely to be successful on appeal. Jenney’s primary argument is that he would
have prevailed on the merits of the Homeowners’ deed restriction and speciﬁc
performance claims, but instead agreed to an unfavorable settlement on the
incompetent advice of counsel. If true, this may give rise to a malpractice claim,
but is insufﬁcient grounds to set aside a court order based on a stipulation in
vindication of a contractual obligation. He also pointed out that the Settlement
Agreement lists the former name of the homeowners association for Seabreeze,
while this action is brought under the current name; J enney argues that this makes
the attempt to enforce the Settlement Agreement by the Homeowners fraudulent. I
ﬁnd that contention unlikely to prevail on appeal as well.

Next I turn to the second and third factors, the relative harms involved in
either issuing, or declining to issue, a stay. If my refusal to vacate is reversed on
appeal after the Jenneys have complied with my order directing speciﬁc
performance by June 30, the Jenneys will have needlessly trimmed their foliage;-
This involves some quantum of threatened irreparable harm. On the other hand, a
stay—improvidently granted—would frustrate the exercise of their property rights
by the other property owners in the Seabreeze subdivision, also involving some

quantum of irreparable harm. Neither the Petitioner nor the Respondents will

 

suffer overwhelming harm, in either case. Finally, threatened harm to the public is
nil.

In sum, I am left with an unlikely appeal and offsetting, and minimally
substantial, competing harms. Under these circumstances, the exercise of my
discretion in favor of a stay is not warranted. I note that the Homeowners have
been attempting for over seven months to enforce the Stipulation and Order for
trimming trees and bushes which, by its terms, was to be completed by October 31,
2014. Accordingly, the Respondents’ request for a stay is DENIED. To the extent
the foregoing requires an order to take effect, IT IS SO ORDERED.

I next turn to the fees and costs incurred by the Homeowners in responding
to the sham transfer of the property, which I found a vexatious litigation tactic. I
shifted attorney fees under the vexatious litigation exception to the American rule
on attorney fees, under which each party bears its own fees, win or lose. I directed
the attorney for the Homeowners to ﬁle an afﬁdavit of fees and costs incurred
solely in response to the sham transaction, including bringing a rule to show cause
for contempt,5 and I gave the Respondents the opportunity to oppose the amount of
fees sought. In objection, the Respondents took issue with the characterization of
the transfer to Mrs. J enney by the Homeowners as a “fraudulent transfer,” asserting

that “no one has yet to produce one shred of legal authority supporting the

5 See Oral Arg. Tr. (May 21, 2015) 27116—2825,,

proposition that a transfer of real property from a husband to his wife in order to
end the harassing and seemingly never-ending acts by the Petitioner was anything
other than legal and permissible,” and argued that because Mrs. Jenney was added
as a party respondent, the motion for contempt related to that transfer was moot
and thus, any fees awarded should exclude time spent on that motion.6 I found,
however, that the transfer itself was a vexatious litigation tactic and was a
contemptuous attempt to avoid enforcement of the Stipulation and Consent Order;
whether or not the effects of the transfer have been minimized by my ﬁnding that
_ Mrs. Jenney should be joined to this action is irrelevant to that finding. In other
words, the response to the fee affidavit was an attempt to reargue my decision to
shift a limited amount of fees, and not, as I had directed, an objection to the
quantum of fees requested by the Homeowners. I find that the Petitioner’s
requested fees are reasonable and comply with my Order on May 21, 2015. This
letter is accompanied by a form of order directing Respondents to pay the

Petitioner’s fees and costs in the amount of $3,750.00.

Sincerely,

/s/ Sam Glasscock 111

Sam Glasscock III

==__'x-.

 

 

 

6 Respjts’ Resp. to Pet’r’s Aff. for Att’y’s Fees at 

 

 

 

 

IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE

SEABREEZE HOMEOWNERS )
ASSOCIATION, INC., )
Petitioner, 3
Va. 3 CA. No. 8635-VCG
MARSHALL JENNEY, 3
Respondent. 3
ORDER“.

 

AND NOW, this 11th day of June, 2015,

The Court having considered the Petitioner’s Afﬁdavit for Attorney’s Fees
and the June 9, 2015 response thereto, IT IS HEREBY ORDERED that

Petitioner is awarded attorney’s fees in the amount of $3,750.00 for work
performed by Petitioner’s counsel relating to the Respondent’s conveyance of
properties located at 317 Salisbury Street and 318 Salisbury Street in Rehoboth

Beach, Delaware,

SO ORDERED:

48/ SEWQLSQAAA;

 

Vice Chancellor

 

