When Maryland developer Joseph Della Ratta struck what he thought was a partnership with a development corporation in late 1979 to build a $4 million office building, he did not bother to put the agreement in writing.
He has not lived to regret it.
Last week, a jury in Maryland's Howard County Circuit Court ruled that the partnership was legal and binding, despite protests to the contrary by the Howard Research & Development Corp., which Della Ratta says backed out of the partnership shortly after it was struck.
The Howard Corp. is now sole owner of the office building.
The jury ordered the corporation to pay Della Ratta the $1.9 million that he claims to have lost in the deal when the partnership didn't materialize.
"There used to be a saying that an oral contract isn't worth the paper it's written on," said Roy Niedermayer, Della Ratta's attorney, last week.
"Obviously, Maryland doesn't feel that way," Niedermayer added.
The Howard Corp., a subsidiary of The Rouse Co., has appealed to Judge Raymond J. Kane Jr..
Kane's ruling is expected sometime after Friday.
"There are motions before the court that the verdict was incorrect," said Howard Senior Vice President Douglas McGregor, who would not discuss the case in detail.
"It is a complicated contract dispute in which the plantiff claims he had an intererest when he did not have one," McGregor said.
A partnership between Della Ratta, owner of Della Ratta Inc., and the Howard Corp. was first formed in 1978, according to Niedermayer, when officials from Howard approached the developer about building three office buildings next to the Columbia Mall in Columbia, Md.
The first building, 10 Columbia Corporate Center, opened in 1979 with great success, Niedermayer said.
Built by Della Ratta's construction firm and primarily financed by the Howard Corp., the $3.9 million building was quickly filled by such tenants as Westinghouse and a computer software firm.
He said Della Ratta talked with Howard Corp. officials in 1979 and agreed the existing partnership would carry over to the second and third buildings.
The Howard officials wrote a memo outlining the partnership agreement, but the deal was never written into a contract or signed by the parties.
Six weeks after the memo, Howard Corp. officials told Della Ratta they wanted him to build the second office building for a fee. However, they added that they did not want or need a partner to share the cost and profit of the venture, according to court documents.
Niedermayer claims the corporation had already found tenants for the second building and did not need Della Ratta to share the then-nonexistent risks of constructing new office space.
The builder sued Howard Corp. in 1981.
McGregor said Howard Corp. lawyers argued during the subsequent trial that a possible partnership was discussed but never agreed upon.
After deliberating 30 minutes, the jury sided with Della Ratta, who completed the second building, 20 Columbia Corporate Center, last year at a cost of $4.2 million.
Niedermayer said Della Ratta was paid for constructing the second building but was not a part owner.
He also said the builder will not construct the third building of the office complex.
According to Niedermayer, "This [settlement] proves the oral word is as good as the written word and that there isn't any difference to the State of Maryland.
"It is just more difficult to prove."