Guzzetta v. SERVICE CORP. OF WESTOVER HILLS
7 A.3d 467
| Del. | 2010Background
- In 2007, the Guzzettas purchased a property to create a grassy play area and planned demolition.
- Service Corporation of Westover Hills sought a permanent injunction based on a deed restriction.
- Temporary restraining order and preliminary injunction were issued; Guzzettas posted security under Rule 65(c).
- A Master recommended against a permanent injunction; later, the trial court increased bond from $5,000 to $10,000.
- Court of Chancery vacated the preliminary injunction, denied a permanent injunction, awarded Guzzetta fees, and awarded $10,000 damages to Guzzetta.
- Guzzetta appeal argued the bond was too low relative to potential damages, seeking reversal and higher bond.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the bond amount abused discretion. | Guzzetta argues bond should reflect potential damages. | Guzzetta/S.C. Westover Hills contends bond properly set and sufficient. | Bond must be set to cover probable damages; here reversal and remand for justification. |
Key Cases Cited
- Mead Johnson & Co. v. Abbott Laboratories, 201 F.3d 883 (7th Cir. 2000) (err on the high side when setting bond to avoid irreparable injury)
- Emerald Partners v. Berlin, 726 A.2d 1215 (Del. 1999) (damages must be proven; timing of damages affects bond scope)
- Coyne-Delany Co., Inc. v. Capital Development Bd. of Illinois, 717 F.2d 385 (7th Cir. 1983) (bonding principles guiding preliminary relief)
- Petty v. Penntech Papers, Inc., 1975 WL 7481 (Del. Ch.) (authority cited on damages and bond considerations)