PIZZA KING, INC., v. THEOCHARI, INC.,

NOT FOR PUBLICATION WITHOUT THE
                               APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
     internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.




                                                         SUPERIOR COURT OF NEW JERSEY
                                                         APPELLATE DIVISION
                                                         DOCKET NO. A-1533-17T1

PIZZA KING, INC., and
FIVE B CORPORATION,

          Plaintiffs-Respondents,

v.

THEOCHARI, INC., MARIA
HADJIYEROU and HARRY
HADJIYEROU,

          Defendants/Third-Party
          Plaintiffs-Appellants,

v.

NATALINA BRUSCO,

     Third-Party Defendant.
____________________________

                    Submitted November 19, 2019 – Decided December 3, 2019

                    Before Judges Fisher and Rose.

                    On appeal from the Superior Court of New Jersey,
                    Law Division, Bergen County, Docket No. L-8204-15.

                    George J. Cotz, attorney for appellants.
              Kates Nussman Ellis Farhi & Earle, LLP, attorneys for
              respondents (Zachary M. Rosenberg, on the brief).

PER CURIAM

         Plaintiff Five B Corporation owns commercial property on Abbott

Boulevard in Fort Lee that consists of five apartments and two stores; plaintiff

Pizza King, Inc. owned and operated a pizzeria in the premises. In 2013, Pizza

King sold its business to defendant Theochari, Inc., for $90,000 plus inventor y;

their contract required Theochari's payment of $10,000 at the time of signing

and $15,000 at the time of closing. Theochari was also required to provide a

$65,000 five-year promissory note at closing.          In accordance with their

agreement, Five B leased Pizza King's premises to Theochari for five years at

the monthly rate of $4000. The individual defendants personally guaranteed

Theochari's performance of these obligations. The contract documents provided

that defendants' default on the lease would trigger a default on the note, and vice

versa.

         Theochari experienced cash flow problems in the summer of 2014 and

failed to pay rent in the fall. Five B and Pizza King (hereafter "plaintiffs") filed

a tenancy action in December 2014, asserting Theochari's failure to pay rent in

September, October, and November 2014.           That complaint also asserted a

default on the promissory note.

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      In January 2015, the parties resolved the tenancy matter and entered into

a consent judgment that required Theochari to pay the past due rent and the

outstanding payments on the promissory note. That total amount was divided

roughly in half; the judgment required the first half to be paid on or before

January 15, 2015, and the other half three days after plaintiffs repaired the

premises.1   The judgment also contained Theochari's agreement to timely

provide the note payments and rent payments going forward; Theochari also

agreed to comply with its original obligation under the lease to provide a

certificate of insurance.

      Theochari and the individual defendants (hereafter "defendants") never

made any of the payments required by the consent judgment or as otherwise

obligated by the promissory note and the lease; they did not provide the

certificate of insurance. And they never inquired whether plaintiff made the

repairs required and never resumed operation of the business.

      Plaintiffs commenced this action, seeking damages arising from

defendants' breach of the settlement agreement, the promissory note, and the

lease. After a four-day bench trial, the judge ruled in plaintiffs' favor. As



 1 In November 2014, a water leak in an upstairs apartment caused problems for
Theochari's business.
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explained in a thorough written decision, the judge found that defendants

breached the promised they made in the contract documents, that plaintiffs made

timely repairs of the premises, and that plaintiffs reasonably attempted to

mitigate damages after defendants breached. In a later written opinion, the judge

quantified the counsel fees to which plaintiffs were entitled.

        Defendants appeal, arguing:

              I.   STANDARD OF REVIEW.

              II. [NATALINA] BRUSCO [2]             WAS    NOT    A
              CREDIBLE WITNESS.

              III. PLAINTIFF CANNOT RECOVER DAMAGES
              FOR BREACH OF THE LEASE BECAUSE IT DID
              NOT MAKE REASONABLE EFFORTS TO
              MITIGATE.

              IV. PLAINTIFF BREACHED THE LEASE BY
              ALLOWING THE PREMISES TO REMAIN
              UNINHABITABLE     THEREBY  EXCUSING
              DEFENDANTS' DEFAULT.

              V. PLAINTIFF EXERCISED ITS RIGHT TO A
              STRICT   FORECLOSURE    AGAINST   THE
              COLLATERAL.

              VI. TO THE EXTENT CONTRACTUAL DAMAGES
              ARE REDUCED, COUNSEL FEES MUST ALSO BE
              REDUCED.



2
    Natalina Brusco was a principal in these entities.
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We find insufficient merit in these arguments to warrant further discussion in a

written opinion, R. 2:11-3(e)(1)(E), and affirm substantially for the reasons set

forth in Judge Mary F. Thurber's thorough and well-reasoned written opinion.

      Affirmed.




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