Hammer v. Howard, Sr.

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

NANCY HAMMER, )
)
Appellant, )
) C.A. No. K20A-11-002 NEP
v. )
)
WILLIAM HOWARD, SR., )
CYNDI HOWARD MCCOY, )
and HOWARD INDUSTRIES, INC., )
)
Appellees. )

Submitted: July 8, 2021
Decided: October 22, 2021

MEMORANDUM OPINION AND ORDER

Upon Appellant’s Appeal of the Decision on Motion to Dismiss of the
Court of Common Pleas

AFFIRMED

Nancy Hammer, Appellant, pro se.

R. Eric Hacker, Esquire, Morris James LLP, Wilmington, Delaware, Attorney for
Appellees.

Primos, J.
 Before the Court is an appeal from the decision of the Court of Common Pleas
(hereinafter the “CCP”) brought by Plaintiff-below/Appellant Nancy Hammer
(hereinafter “Plaintiff”). On November 16, 2020, Plaintiff filed an appeal of the
CCP’s determination (hereinafter the “CCP’s Order”) to grant the Motion to Dismiss
of Defendants-below/Appellees William Howard, Sr., Cyndi Howard McCoy, and
Howard Industries, Inc. (hereinafter collectively “Defendants”). The CCP’s Order
dismissed Plaintiff’s case with prejudice based upon res judicata and the statute of
limitations. This Court, while disagreeing with some of the CCP’s legal analysis,
AFFIRMS the CCP’s Order for the reasons that follow.
FACTUAL AND PROCEDURAL BACKGROUND
On May 8, 2015, Plaintiff filed a breach of contract claim in this Court
(hereinafter “Hammer I”) against Howard Medical, Inc., and Howard Industries,
Inc., for commission payments allegedly owed to Plaintiff for work performed prior
to her termination. In Hammer I, Plaintiff contended that she entered into both an
oral “implied” agreement on June 10, 2010, and a written agreement on August 18,
2010, to sell medical equipment with those defendants, pursuant to which she would
earn a commission on each sale.1 Plaintiff alleged that she was to earn a 10%
commission for sales to customers she had “secured” during her employment.2 In
Hammer I, Plaintiff failed to respond appropriately to interrogatories,
notwithstanding this Court’s repeated instructions and orders to her to do so. 3 On
April 26, 2017, after the defendants filed a motion to dismiss based on the
aforementioned discovery violations, this Court granted the motion in an order,
dismissing Plaintiff’s case with prejudice.4

1
Hammer I, Compl. ¶¶7-8.
2
Hammer I, Compl. ¶11.
3 Hammer v. Howard (“Hammer II”), 2020 WL 6083725, at *1 (Del. Com. Pl. Oct. 15, 2020).
4
See R. at APPX260-264 (“This dispute about the Interrogatories and her failure to comply has
been going on for nearly a year. It is clear that Hammer has been using her objections and non-

2
 On December 20, 2019, Plaintiff filed a new claim in the CCP against
Defendants for debt allegedly resulting from Defendants’ failure to pay commissions
for purchase orders from customers Plaintiff had acquired prior to her termination
but who had made purchases post-termination. In her complaint, Plaintiff asserted
that these commissions became payable in 2014 and 2015 after her customers
completed purchases, and that Plaintiff did not receive documentation from
Defendants regarding the commissions until December 22, 2016, and April 27,
2017.5
On January 27, 2020, Defendants filed a Motion to Dismiss with the CCP,
arguing that the complaint should be dismissed on two separate grounds, i.e, res
judicata and the applicable statute of limitations. Thereafter, Plaintiff filed this
appeal.
STANDARD OF REVIEW
On appeal from the CCP to this Court, “the standard of review is whether there
is legal error, whether the trial court's factual findings are sufficiently supported by
the record, and whether those findings are the product of an orderly and logical
reasoning process.”6 First, questions of law are reviewed de novo.7 Second, this
Court has analogized review of the CCP’s findings of fact to a substantial evidence
standard.8 Therefore, this Court’s role “is to correct errors of law and to review the

compliance as a tactic to delay the progress of this case. . . . After consideration of the six Drejka
factors, the Court is convinced that the only appropriate sanction for Hammer [sic] repeated and
willful failure to respond to Howard’s First Set of Interrogatories is dismissal of her case with
prejudice.”). The referenced appendix (“APPX”) is the Appendix to Defendants’ Motion to
Dismiss, which is part of the record from the CCP filed in this Court.
5
CCP Compl. ¶¶8-9.
6
Hicklin v. Onyx Acceptance Corp., 970 A.2d 244, 248 (Del. 2009).
7 Massey v. Nationwide Assurance Co., 2018 WL 4692488, at *2 (Del. Super. Sept. 28, 2018)

(citing Robert J. Smith Companies, Inc. v. Thomas, 2001 WL 1729143, at *2 (Del. Super. Dec. 10,
2001)).
8 See, e.g., May v. Hillcap I, LLC, 2020 WL 4932331, at *3 (Del. Super. Aug. 21, 2020) (“The

Court will not disturb a CCP decision without finding an error of law or lack of substantial

3
factual findings of the court below to determine if they are sufficiently supported by
the record and are the product of an orderly and logical deductive process.”9
The CCP’s Order granted Defendant’s motion to dismiss for failure to state a
claim pursuant to Court of Common Pleas Civil Rule 12(b)(6). On such a motion,
the moving party bears the burden of demonstrating that “under no set of facts which
could be proven in support of [the complaint] would the [plaintiff] be entitled to
relief.”10 Upon a trial court’s review of a motion to dismiss, “(i) all well-pleaded
factual allegations are accepted as true; (ii) even vague allegations are well-pleaded
if they give the opposing party notice of the claim; (iii) the [c]ourt must draw all
reasonable inferences in favor of the non-moving party; and [(iv)] dismissal is
inappropriate unless the plaintiff would not be entitled to recover under any
reasonably conceivable set of circumstances susceptible of proof.”11 A trial court
may properly decide a motion to dismiss by considering documents referenced in
the complaint and may take judicial notice of “matters that are not subject to
reasonable dispute.”12
DISCUSSION
On appeal, Plaintiff has raised several issues regarding decisions of the CCP
rendered prior to the CCP’s Order. 13 As to Plaintiff’s two motions for default

evidence as support from the record below.”); Thomas, 2001 WL 1729143, at *2 (“In addressing
appeals from a trial court, this Court is limited to correcting errors of law and determining whether
substantial evidence exists to support factual findings.”).
9
Uribe v. Md. Auto. Ins. Fund, 2014 WL 4942340, at *2 (Del. Super. Sept. 30, 2014), aff'd, 115
A.3d 1216 (Del. 2015) (internal quotations and citations omitted).
10
Dufresne v. Camden-Wyoming Fire Co. Inc., 2020 WL 2125797, at *2 (Del. Super. May 5,
2020) (internal quotations omitted) (alterations in original).
11
Savor, Inc. v. FMR Corp., 812 A.2d 894, 897 (Del. 2002) (citing Kofron v. Amoco Chems. Corp.,
441 A.2d 226, 227 (Del. 1982)).
12 In re Gen. Motors (Hughes) S'holder Litig., 897 A.2d 162, 169 (Del. 2006) (citation omitted).
13
These include the CCP’s 1) denial of Plaintiff’s motions for default judgment on two separate
occasions, 2) refusal to strike Defendants’ letter objecting to Plaintiff’s first motion for default
judgment, and (3) refusal to strike Defendants’ motion to dismiss. See Plaintiff’s Opening Brief
at 6-7.

4
judgment prior to the CCP’s Order, the CCP noted in both instances that “the
sanction for filing a pleading late is not dismissal.”14 This Court finds no legal error
or abuse of discretion in the CCP’s denial of default judgment or any of its other
discretionary decisions rendered prior to the CCP’s Order.
As to the CCP’s Order, Plaintiff argues in her reply brief that there were both
legal and factual errors made by the CCP in analyzing the issues of res judicata and
the statute of limitations.15
1. Res Judicata
The doctrine of res judicata precludes efforts to litigate the same cause of
action more than once.16 In Delaware, a dismissal with prejudice is considered an
adjudication on the merits.17 When an action has been dismissed on the merits, the
res judicata doctrine “forecloses a losing party from reasserting for a second time
the same cause of action against the same party.”18
In her appeal, Plaintiff does not dispute that the original dismissal was on the
merits, but instead contends that the application of res judicata to her claims was
improper. Under Delaware law, a party claiming that the doctrine of res
judicata bars a subsequent action must demonstrate the presence of five elements:
“(1) the court making the prior adjudication had jurisdiction, (2) the parties in the

14
Hammer II, 2020 WL 6083725, at *3. Additionally, Defendants argued that Plaintiff did not
follow the proper procedure for seeking a default judgment because she did not file an affidavit
pursuant to Court of Common Pleas Civil Rule 55(b)(1).
15
The Court notes Defendants’ position that the Court should not consider any of the Plaintiff’s
arguments not raised in her opening brief. However, Defendants argued in their answering brief
why these legal issues, specifically res judicata and the statute of limitations, were correctly
decided. Therefore, the Court will take into consideration Plaintiff’s response, but finds that
Plaintiff has waived any additional arguments in her reply brief not stemming from these two
issues by failing to assert them in her opening brief.
16 Kaufman v. Nisky, 2011 WL 7062500, at *1 (Del. Super. Dec. 20, 2011) (citing Ezzes v.

Ackerman, 234 A.2d 444, 446 (Del. 1967)).
17
Id. (citing Savage v. Himes, 2010 WL 2006573, at *3 (Del. Super. May 18, 2010)).
18
Id. (citing Savage, 2010 WL 2006573, at *3).

5
present action are either the same parties or in privity with the parties from the prior
adjudication, (3) the cause of action must be the same in both cases or the issues
decided in the prior action must be the same as those raised in the present case, (4)
the issues in the prior action must be decided adversely to the plaintiff's contentions
in the instant case, and (5) the prior adjudication must be final.”19

Plaintiff has not argued on appeal that the CCP erred in its determination of
factors 1, 4, and 5. Therefore, the Court will consider only factors 2 and 3.

a. Factor 2—Privity
Plaintiff claims that the two suits she filed had different defendants. While
this is true on its face—in the instant suit both William Howard, Sr., and Cyndi
Howard McCoy (hereinafter “Mr. Howard and Ms. McCoy”) were added—the res
judicata doctrine, as noted supra, applies not only to the same parties but to those in
“privity with the parties from the prior adjudication.”20 Privity “does not require a
direct contractual relationship,”21 but rather is a “legal determination” made by the
trial court “with regard to whether the relationship between the parties is sufficiently
close to support preclusion.”22 Parties are in privity when “their interests are
identical or closely aligned such that they were actively and adequately represented
in the first suit.”23 In general, “[a] director's close relationship with the corporation
will . . . establish privity.”24

19 Bailey v. City of Wilmington, 766 A.2d 477, 481 (Del. 2001).
20
Id.
21
Aveta Inc. v. Cavallieri, 23 A.3d 157, 180 (Del. Ch. 2010).
22
Higgins v. Walls, 901 A.2d 122, 138 (Del. Super. 2005) (quoting James Wm. Moore et al.,
Moore’s Federal Practice § 132.04[1][b] (3d. ed. 2004)).
23
Aveta, 23 A.3d at 180.
24
Lowell Staats Min. Co. v. Phila. Elec. Co., 878 F.2d 1271, 1277 (10th Cir. 1989) (citing Oglala
Sioux Tribe of Pine Ridge Indian Rsrv. v. Homestake Min. Co., 722 F.2d 1407, 1410 (8th Cir.
1983)); see also Pedrina v. Chun, 97 F.3d 1296, 1302 (9th Cir. 1996) (finding corporate officers
named in RICO action were in privity with corporation that was party to earlier action because the

6
 Here, the CCP concluded that the two actions involved the same parties and
their privies. However, in making that determination, the CCP appears to have relied
on the fact that Plaintiff “affiliates” the added parties—Mr. Howard and Ms.
McCoy—with Howard Industries, Inc.25 Plaintiff’s subjective viewpoint of the
affiliation between the parties, however, is not determinative. The correct inquiry is
to examine the added parties’ interests as stated in the complaint and to determine if
they are “identical or closely aligned such that they are actively and adequately
represented in the first suit.”26

Plaintiff’s CCP complaint reflects that Mr. Howard and Ms. McCoy are
corporate officers of Howard Industries Inc.27 The complaint also alleges that Mr.
Howard and Ms. McCoy made key decisions in the company, directly involving
Plaintiff’s conditions of employment.28

Here, as corporate officers, with at least some control over both hiring and
firing decisions and those concerning compensation—specifically involving
Plaintiff—Mr. Howard’s and Ms. McCoy’s interests were identical or closely
aligned with those of the defendants in Hammer I, and their interests were adequately
represented in that suit.
b. Factor 3—Same Transaction
Delaware follows a transactional approach to res judicata.29 In determining
whether two claims arise under the same transaction, the fact finder looks at
“whether the facts are related in time, space, origin, or motivation, whether they form

officers stood accused of participating in the same wrongdoing, committed in their official
capacities, of which the corporation stood accused in the earlier action).
25
Hammer II, 2020 WL 6083725, at *5.
26
Aveta, 23 A.3d at 180.
27
CCP Compl. ¶¶2-3.
28
See id. ¶¶4-5.
29
LaPoint v. AmerisourceBergen Corp., 970 A.2d 185, 193 (Del. 2009) (citations omitted).

7
a convenient trial unit, and whether their treatment as a unit conforms to the parties'
expectations or business understanding or usage.”30 “Two claims derive[d] from a
common nucleus of operative fact[s] arise from the same transaction. . . . [T]o
assert res judicata as a bar to a plaintiff's claim, in addition to showing that the same
transaction formed the basis for both the present and former suits, the defendant must
show that the plaintiff neglected or failed to assert claims which in fairness should
have been asserted in the first action.”31
The CCP ultimately determined that the claims in Hammer I and those in the
instant case arose from the same transaction. Although this Court agrees with the
CCP’s conclusion, the Court feels it important to explain the legal reasoning behind
that conclusion, given that the CCP did not address the issue of Plaintiff’s ability to
sue for future commission claims during Hammer I.32

The pleadings reflect that Plaintiff was fired on May 8, 2013.33 The CCP
effectively took judicial notice of a letter dated February 20, 2014,34 attached as an
exhibit in Plaintiff’s motion practice in Hammer I35 and provided by Plaintiff to the
CCP during oral argument on Defendants’ Motion to Dismiss. 36 The letter was sent

30
Id. (internal quotations omitted).
31 Id. (internal quotations omitted) (first and second alteration in original).
32
Plaintiff has argued below and to this Court that the transactions had not consummated until
after her termination, and therefore that she was not aware a breach had occurred until 2016 and
2017. Additionally, Plaintiff attempts to distinguish the two sets of claims from each other because
they are separate in time.
33
CCP Compl. ¶4.
34
Hammer II, 2020 WL 6083725, at *1 (stating contents of the letter in the factual and procedural
history portion of the CCP’s Order).
35
R. at APPX333 (attached as an exhibit to Plaintiff’s Motion from Relief from Order dated May
8, 2017).
36 CCP Civil Worksheet (Aug. 14, 2020) (listing “Feb. 20, 2014 Letter from Richard Yoder” under

“Plaintiff(s) [sic] Exhibits”). Neither party disputes the authenticity of the letter. See Pl.’s
Response to Defs.’ Mt. Dismiss ¶19 (claiming that on “February 20, 2014, Defendants [sic]
Counsel, Richard Yoder wrote to Plaintiff . . . .”). Hence, the letter’s existence is “not subject to
reasonable dispute.” See Gen. Motors, 897 A.2d at 169 (“The trial court may also take judicial

8
to Plaintiff by Richard Yoder, attorney for Howard Industries, Inc., and stated,
“[H]oward has denied and continues to deny that it owes [Plaintiff] a commission
on firm orders accepted after June 10, 2013 . . . . No further payments will be made
by Howard regarding this matter.”37 At this point, Plaintiff had notice of
Defendants’ alleged breach of any oral or written contractual commission
agreements.

Ordinarily, this letter, and the statement within it, would be considered an
anticipatory repudiation.38 “In the case of an anticipatory repudiation the non-
breaching party is entitled to a choice of several different types of remedy, including
waiting until performance is due to pursue its claims.”39 However, “significant
authority supports the conclusion that a repudiation coupled with simultaneous non-
performance gives rise to an action for total breach . . . under the contract.”40 In

notice of matters that are not subject to reasonable dispute.”) (citation omitted). Moreover, the
letter was part of the record in Hammer I, and Plaintiff herself had placed the letter into that record,
and it was therefore proper for the CCP to take judicial notice of the letter for purposes of deciding
a Rule 12(b)(6) motion to dismiss. See Fortis Advisors LLC v. Shire US Holdings, Inc, 2020 WL
748660, at *1 n.3 (Del. Ch. Feb. 13, 2020) (stating, in deciding a Rule 12(b)(6) motion to dismiss
based on res judicata, “[w]hile I have drawn the facts from the well-pled allegations in the
Complaint, I have also taken judicial notice of the court record that gave rise to the 2017
Decision”); see also Frank v. Wilson, 32 A.2d 277, 280 (Del. 1943) (taking judicial notice of court
record in companion litigation when addressing a motion to dismiss); Orloff v. Shulman, 2005 WL
3272355, at *12 (Del. Ch. Nov. 23, 2005) (taking judicial notice of the “record of the bankruptcy
court's approval” of a lease assignment).
37
R. at APPX333.
38 23 Williston on Contracts § 63:28 (4th ed.) (defining an anticipatory breach as “a repudiation of

the obligations of a contract by a party to it before the time has come for performance on his or
her part”).
39
BioVeris Corp. v. Meso Scale Diagnostics, LLC, 2017 WL 5035530, at *8 (Del. Ch. Nov. 2,
2017), aff'd, 202 A.3d 509 (Del. 2019) (TABLE) (citing 23 Williston on Contracts § 63:33 (4th
ed.)).
40
Id.

9
other words, “the non-performance plus the repudiation constitute one and only one
cause of action.”41

Here, Plaintiff has acknowledged that she received the February 2014 letter,
and therefore she was put on notice of Defendants’ position regarding any future
commission payments. She subsequently sued in Hammer I for commissions she
deemed she was owed, alleging non-performance of written or oral agreements.
Consequently, the February 2014 letter, paired with the missed payments as
originally alleged in Hammer I, encompassed a total breach and formed “one cause
of action.”

Plaintiff was in the proper position to sue for her right to all current and future
claims for commission payments during Hammer I.42 Now Plaintiff is attempting to
get a second bite at the apple. Both claims arise from the same “nucleus of operative
fact,” including the employment arrangement and accompanying contractual
agreements regarding earned commissions. Once the Court in Hammer I dismissed
Plaintiff’s claims, including breach of contract claims, with prejudice, her rights to
pursue future claims under the same operative contracts were extinguished, as they

41
Id. at *9 (internal quotation marks omitted) (quoting 9 Arthur Linton Corbin Corbin on
Contracts § 954 (interim ed. 2002)) (citations omitted); 10 John E. Murray, Jr. Corbin on
Contracts § 53.12 (Joseph M. Perillo, ed., rev. ed. 2014) (citations omitted)); see also id. (internal
quotations marks omitted) (quoting 31 Williston on Contracts § 79:19 (4th ed.)) (“In the case of a
strictly anticipatory breach, it is true, there is often at least a theoretical possibility that the
repudiator can and will effectively withdraw the repudiation so that the contract can be performed,
but after a material present breach, any attempt to withdrawal by the wrongdoer would be
ineffectual. . . .The idea that the injured party may elect not to call a breach something that is a
breach . . . is not logically defensible, whatever authorities may be cited in its favor.”).
42
The mere fact that Plaintiff was not aware of the specific future commissions she alleged she
was owed until a later time does not negate her ability and obligation to sue for the total breach of
the alleged agreements in Hammer I.

10
were part of the same transaction.43 Therefore, the CCP properly determined that
Plaintiff’s claims in that Court were barred by the principle of res judicata.

2. Statute of Limitations
As noted supra, res judicata provided an adequate ground for dismissal of
Plaintiff’s claims in the CCP. Accordingly, this Court need not, and will not, reach
the merits of the CCP’s determination that Plaintiff’s claims are also barred by the
applicable statute of limitations.
CONCLUSION
WHEREFORE, for the foregoing reasons, the CCP’s Order is AFFIRMED .
IT IS SO ORDERED.

/s/Noel Eason Primos
Judge

NEP/wjs
Via File & ServeXpress
Oc: Prothonotary
Nancy Hammer, pro se
Counsel of Record

43 See Kaufman, 2011 WL 7062500, at *1 (citing Savage, 2010 WL 2006573, at *3) (“In Delaware,
a dismissal with prejudice is considered an adjudication on the merits.”).

11