Illona v. Curtis Center
Illona v. Curtis Center No. 3236 EDA 2016
| Pa. Super. Ct. | Jul 25, 2017Background
- Illona, LLC leased two suites (L45 and L89) and obtained an exclusive license to use the Atrium/Dream Garden (License Area) at the Curtis Center for banquets/weddings under a 2008 ten-year Lease.
- Curtis Center succeeded the prior landlord in 2014 and announced extensive renovations in 2015 that would affect Illona’s exclusive use, including removal of architectural features and erection of scaffolding.
- Illona had numerous bookings (dozens to ~120) for events during the renovation period and alleges it relied on the License and invested substantially.
- Illona sued after construction began and asserted claims including declaratory/equitable relief (irrevocable license), breach-based torts (tortious interference), gross negligence (damage to a Tiffany mosaic), and unjust enrichment.
- Trial court sustained defendants’ preliminary objections and dismissed Illona’s fourth amended complaint; the Superior Court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Illona holds an irrevocable license to the Atrium (distinct from leasehold) | License was irrevocable due to Illona’s detrimental reliance and investments securing exclusive event use | Lease expressly creates the license, defines common areas, and allows landlord alterations; written agreement governs rights | The court held the License was governed by the Lease, not an enforceable equitable irrevocable license given the written contract terms |
| Whether Illona had a right to quiet enjoyment of the License Area | License conferred a right of quiet enjoyment protecting event use | Covenant of quiet enjoyment applies to leasehold interests, not mere licenses; Illona’s quiet enjoyment applies to its leased suites only | Court held quiet enjoyment covered Illona’s leased suites, not the licensed common-area Atrium |
| Tortious interference with third‑party contracts | Curtis Center intentionally and without privilege interfered with Illona’s wedding contracts | Claim is essentially a contract-based grievance; barred by gist-of-the-action/economic-loss doctrines; no allegation of purposeful malice | Court dismissed tortious interference as arising from the Lease (contract) and lacking pleaded intentional, unjustified conduct |
| Gross negligence re: damage to Tiffany mosaic | Curtis Center’s construction caused damage; Lease permits gross-negligence claims | Section 7.5’s indemnity/liability language does not expose landlord for the alleged facts; Section 7.5 applies to damages from illegal third-party acts except for landlord’s own gross negligence tied to such acts | Court dismissed; Section 7.5 did not support the asserted gross-negligence claim under these facts |
| Unjust enrichment against various defendants | Some defendants are not parties to the Lease and were unjustly enriched by rents without providing value | An express written lease governs parties’ rights; unjust enrichment not available where an express contract exists and Illona failed to plead which defendants were outside the Lease | Court dismissed unjust enrichment as duplicative/inadequately pleaded given the written Lease |
Key Cases Cited
- Huff v. McCauley, 53 Pa. 206 (Pa. 1866) (origin of equitable irrevocable-license doctrine)
- Kovach v. General Telephone Co., 489 A.2d 883 (Pa. Super. 1985) (successors take subject to an irrevocable license if they had notice)
- Harkins v. Zamichieli, 405 A.2d 495 (Pa. Super. 1979) (describing irrevocable license as akin to an easement when reliance exists)
- Cole v. Ellwood, 65 A. 678 (Pa. 1907) (irrevocable license protects licensee’s enjoyment)
- Morning Call, Inc. v. Bell Atl.-Pennsylvania, Inc., 761 A.2d 139 (Pa. Super. 2000) (discussing irrevocable license principles)
- T.W. Phillips Gas & Oil Co. v. Jedlicka, 42 A.3d 261 (Pa. 2012) (contract/lease interpretation governed by plain language)
- Margolin v. Pennsylvania R.R. Co., 168 A.2d 320 (Pa. 1961) (written agreement creating license governs; no irrevocable license where contract defines terms)
- Bruno v. Erie Ins. Co., 106 A.3d 48 (Pa. 2014) (gist-of-the-action doctrine bars tort claims grounded in contract)
- Hillis Adjustment Agency, Inc. v. Graham Co., 911 A.2d 1008 (Pa. Super. 2006) (elements of tortious interference)
- Jeannette Paper Co. v. Longview Fibre Co., 548 A.2d 319 (Pa. Super. 1988) (intentional, malicious interference may support tort recovery)
- Mitchell v. Moore, 729 A.2d 1200 (Pa. Super. 1999) (unjust enrichment not available where an express contract governs)
- Ruby v. Abington Mem’l Hosp., 50 A.3d 128 (Pa. Super. 2012) (affirming dismissal of unjust enrichment where express contracts exist)