The opinion of the court was delivered by: Loretta Preska, District Judge
This action arises out of a failed mortgage loan transaction undertaken in connection with an attempt by plaintiff CGI Properties Ltd. II Realty Trust ("CGI") to acquire certain property in Bloomsburg, Pennsylvania. Individual plaintiffs Gerald D. Cohen, Harold C. Garnick and Richard B. Cohen are the trustees and beneficiaries of plaintiff CGI (collectively, "plaintiffs"). When the financing arrangement did not come to fruition, plaintiffs commenced suit against the proposed lender, defendant Lehman Brothers Bank, FSB ("Lehman"), claiming breach of contract and promissory estoppel.
Plaintiffs' claims are based on a document titled "Lehman Brothers CTL Program Application/Commitment Letter" (the "Application"). Plaintiffs argue that the Application constitutes a contract which Lehman breached when it terminated the loan transaction. Alternatively, plaintiffs argue that the Application constitutes a preliminary binding agreement which Lehman breached by failing to negotiate in good faith to consummate the loan transaction. Plaintiffs also claim that Lehman breached its implied obligation of good faith and fair dealing under the preliminary binding agreement. Finally, plaintiffs contend that Lehman should be held liable for reliance damages under the theory of promissory estoppel.
Defendant argues that the parties did not enter into any agreement — preliminary or otherwise — because the Application was not a binding contract. Alternatively, defendant contends that plaintiffs' first three claims based on breach of contract are barred by the Statute of Frauds because there is no writing subscribed by Lehman agreeing to make a mortgage loan to plaintiffs. With respect to plaintiffs' promissory estoppel claim, defendant argues that plaintiffs cannot demonstrate either that defendant made a clear and unambiguous promise or that any reliance by plaintiffs was reasonable. Lehman now moves for summary judgment on all of plaintiffs' claims. In the alternative, Lehman moves to strike plaintiffs' jury demand.
I. Timeline of the Transaction
The following facts are taken from the parties' Rule 56.1 Statements and are undisputed. In the late fall of 1999, CGI became interested in purchasing certain commercial real property in Bloomsburg, Pennsylvania, as part of a tax-free exchange of property under Internal Revenue Code § 1031. As part of this endeavor, in late 1999 or early 2000, CGI retained the services of Casimir Groblewski of Spectrum Financial Corporation to serve as a mortgage broker in securing a mortgage loan. Groblewski solicited quotes on CGI's behalf from a number of lenders, including Lehman, and on February 15, 2000, Groblewski advised Gerald Cohen by email of his communications. He summarized the proposals of three possible lenders and concluded that "Lehman is the best bet," with which Gerald Cohen agreed.
On or about March 6, 2000, Lehman provided CGI with a document with the heading "Lehman Brothers CTL Program Application/Commitment Letter." (Ex. H to the Affidavit of Kathleen A. Donohue ("Donohue Aff.")). On March 29, 2000, the marked-up document was returned to Lehman. On April 10, 2000, Gerald Cohen overnighted to Charles Manna at Lehman an "executed Application for the [Bloomsburg] property as well as a [deposit] check for $30,000." (Ex. J to Donohue Aff.). The executed Application was dated April 6, 2000 and was signed by Gerald Cohen, Harold Garnick and Richard Cohen, as trustees of CGI. (Ex. K to Donohue Aff.).
The loan transaction was never consummated. On May 15, 2000, Manna forwarded Gerald Cohen a letter written by Kenneth Cohen at Lehman, which stated, "We have notified you that we will be unable to issue a Commitment and you have requested us to return to you any unexpended deposit. . . ." (Ex. S to Donohue Aff.). Lehman subsequently refunded $20,112.50 of the deposit made by CGI.
The Application, dated April 6, 2000, (Ex. K to Donohue Aff.), contains several provisions which are relevant to this Court's consideration of defendant's motion. Much quoted by both parties is Section B of the Application, titled "Commitment," which provides in pertinent part:
The consummation of the Loan transaction is
conditioned upon the issuance by Lender [Lehman] of a
mortgage loan commitment substantially in the form
annexed hereto as Schedule 3 (the "Commitment")
confirming its agreement to make the Loan upon, and
subject to, the terms and conditions set forth in this
(Ex. K at 1). Section C of the Application provides:
In addition to the issuance and acceptance of a
Commitment, the closing of the Loan shall be
conditioned upon (a) the completion by Lender and
Lender's Counsel (hereinafter defined) of such due
diligence investigations with respect to Borrower, its
principals and the Property as Lender and Lenders
Counsel shall deem appropriate. . . .
(Id. at 2). Section I of the Application, which discusses termination, provides that "Lender may, at any time prior to the issuance of a Commitment and at its sole discretion, decline to proceed further with respect to a financing of the Property." (Id. at 6). The Application also contains the following paragraph:
THIS APPLICATION IS NOT A COMMITMENT BY LENDER TO LEND
(ON EITHER AN EXPRESS OR IMPLIED BASIS) AND DOES NOT
IMPOSE ANY OBLIGATIONS ON LENDER. LENDER SHALL ONLY
COMMIT TO MAKE A LOAN WITH RESPECT TO THE PROPERTY
PURSUANT TO A COMMITMENT SUBSTANTIALLY IN THE FORM
ANNEXED HERETO AS SCHEDULE 3 (WITH SUCH MODIFICATIONS OR
SUPPLEMENTS AS LENDER SHALL DEEM APPROPRIATE) WHICH HAS
BEEN SIGNED BY LENDER AND COUNTERSIGNED BY BORROWER AND