A dispute over a supermarket tenant’s right to subdivide its leased parcel from a larger shopping center has led to a series of legal decisions confirming the tenant’s contractual rights and outlining the obligations of both parties. The conflict centers on whether the shopping center’s owners must cooperate with the tenant’s efforts to obtain government approvals for subdivision, an issue with implications for commercial leasing practices.
The case was brought by Acme Markets, Inc., which filed complaints in the Superior Court of New Jersey against Bayshore Mall 1A, LLC, Bayshore Mall 1B, LLC, and Bayshore Mall 2, LLC. The matter was reviewed by both the Law Division and Chancery Division in Cape May County under Docket No. L-0028-24. The Appellate Division issued its decision on April 1, 2026.
According to court documents, Acme holds a ninety-nine-year lease for sixty-three acres within Bayshore Mall, stemming from an agreement executed in 1988 by predecessors of both parties. The lease included an option for Acme to purchase its leased parcel after obtaining municipal subdivision approval. Over ten years of litigation have focused on whether Acme can exercise this option and what level of cooperation is required from Bayshore as landlord.
The central issue involves Acme’s attempts to subdivide its leased premises from the rest of the shopping center. The lease obligates Bayshore to “cooperate with and assist” Acme in securing necessary governmental approvals for subdivision, including executing documents required by authorities. Despite this clause, Bayshore opposed Acme’s efforts on several grounds: alleged breaches by Acme such as failing to provide an accurate as-built survey; encroachments onto common areas; nonconforming outdoor sales and signage; and claims that requested variances would negatively impact the remainder of the property.
Acme initiated legal action in 2016 seeking to compel Bayshore’s compliance with these cooperation provisions. In response, Bayshore counterclaimed to invalidate Acme’s subdivision plan. Judge Julio Mendez partially granted summary judgment for Acme in April 2017, upholding Acme’s purchase option and finding that “the governing documents are crystal clear and provide[d] Acme with the right to exercise the purchase option.” Judge Mendez also affirmed that Bayshore had “a duty to cooperate [with] and assist Acme in subdividing the premises.”
However, Judge Mendez found that while Bayshore must work diligently with Acme—including correcting inadvertent mistakes in documents—it was not required to sign every document exactly as presented if inaccuracies existed. He noted inconsistencies between site plans attached as exhibits but accepted modifications proposed by Acme that aligned with land descriptions.
Subsequent motions saw further refinement of each party’s rights and duties. In August 2017, Judge Mendez enjoined certain activities by Acme—such as sidewalk sales and unauthorized signage—after municipal planning authorities denied related variance applications. However, he declined requests from Bayshore to prevent future variance applications or block pursuit of subdivision entirely.
As litigation continued into subsequent years—including discovery disputes resolved through appointment of a special adjudicator—Acme filed amended complaints reiterating claims that Bayshore breached its obligation under the lease by refusing full cooperation on subdivision matters. In September 2023, another complaint renewed demands for declaratory relief compelling cooperation and sought compensatory damages plus attorney fees.
In February 2024, Judge Michael J. Blee consolidated related cases under one docket (second action). Both sides moved for summary judgment later that year. On November 22, 2024, Judge Blee granted summary judgment largely in favor of Acme regarding breach-of-contract claims against Bayshore but ruled partly for Bayshore concerning allocation of real estate taxes due to ambiguity in lease language.
Judge Blee determined that “Bayshore breached the Lease by failing to cooperate with and assist Acme in obtaining subdivision approval,” calling arguments about discrepancies or variances “baseless.” He cited earlier orders requiring mutual correction of inadvertent errors as part of cooperation duties outlined in their contract.
The judge also found that any alleged breaches by Acme—such as minor encroachments or need for zoning variances—did not rise to material breaches justifying refusal by Bayshore to cooperate under the lease terms. He stated there were alternative remedies available if damages occurred but those did not excuse non-cooperation regarding subdivision rights.
On reconsideration motions filed by Bayshore challenging these findings—including arguments about advisory opinions or expanded obligations—the court reaffirmed prior reasoning: enforcing plain language rather than issuing hypothetical rulings or exceeding contractual boundaries.
On appeal before Judges Mayer and Jacobs at the Appellate Division (Docket No. A-1717-24), all lower court orders were affirmed. The appellate opinion emphasized standards for summary judgment review and contract interpretation under New Jersey law while rejecting arguments advanced by Bayshore about materiality of alleged breaches or limits on cooperation clauses.
The opinion concluded that none of Acme’s actions constituted material breaches precluding enforcement of its purchase option or requiring denial of equitable relief; nor did they justify limiting reciprocal obligations under their agreement. Furthermore, issues involving land use violations were properly directed toward administrative remedies before being raised as breach-of-contract claims.
Attorneys representing appellants (Bayshore) were David Larry Braverman and Kevin W. Burdett (Braverman Kaskey PC). Attorneys representing respondent (Acme) included Mark A. Kasten and Gerald E. Burns (Buchanan Ingersoll & Rooney PC), admitted pro hac vice from Pennsylvania bar; Nicholas F. Talvacchia; Cooper Levenson; Buchanan Ingersoll & Rooney PC handled briefing.
Source: A171724_Acme_Markets_Inc_v_Bayshore_Mall_A1_LLC_Opinion_New_Jersey_Superior_Court_of_Appeals.pdf
