DOWNTOWN OXFORD – Normally, the 5-1 Diner is a popular place to have breakfast and lunch or enjoy some ice cream from Cook’s Farm Dairy.
But on Aug. 31, the 51 S. Washington St. restaurant was visited by a small group of protesters and some television cameras as people came to support the staff and speak out against what they perceive as a gross injustice.
“It’s audacious and I don’t think that the community will allow it, will stand for it,” said Oxford resident Emily Towlerton.
“It’s outrageous to do that to a local business,” said Katie Rose, of Oxford.
“I think that what’s going on is wrong. I think it’s very wrong,” said regular diner customer Melissa Cordes. “They can’t get away with it.”
They’re referring to the fact that Nicole Ellsworth and her staff found themselves locked out of the 5-1 Diner last week by the people who own it. All of them are now, apparently, out of work.
“To kick somebody out like that is just baloney,” Rose said.
According to Ellsworth, of Oxford, she took over running the diner in April and was in the process of purchasing it per a verbal agreement.
There was no written agreement.
She claims she was making weekly payments to the owner as a show of “good faith,” but never requested or received any receipts. On top of that, she claims to have been paying rent to the property management company, even though the lease for the diner space is not in her name, and covering thousands of dollars in diner debts incurred prior to her taking over.
Ellsworth did take certain steps one could reasonably expect from someone who’s in the process of assuming ownership of a business.
She registered “51 Diner” as her Doing Business As (DBA) name with Oakland County on April 12. The county website shows it’s hers until April 11, 2021.
She applied for and received an employer identification number from the Internal Revenue Service for tax purposes.
Ellsworth noted she was also paying to stock and insure the diner.
But much to her shock and dismay, Ellsworth now finds herself locked out of the diner and facing a potential legal battle.
“I’m heartbroken. I’m absolutely at a loss for words,” she said. “You can’t just lock the door on somebody like that.”
On Saturday, Aug. 27, Ellsworth closed the diner for the day at 3 p.m. When she returned to do some work at 5 p.m., she discovered the locks had been changed.
“My keys didn’t work,” she said.
There was also a sign in the window to let patrons know the diner was “closed for remodeling.”
Ellsworth said she contacted Liljana Lucaj, who’s the leaseholder for the diner space, and “she told me that she was selling to somebody else and that we were out.”
“They were going to go in a different direction, (those were) her exact words,” she said.
According to Ellsworth, when she encountered the people who are apparently the new owners on Monday, Aug. 29, “they said they gave Nick an $80,000 deposit and that they were going to be opening on Monday (Sept. 5).”
The diner did not open on Monday and as of press time on Tuesday, it was still closed.
Nick is Nick Lucaj, the father of Liljana and the man who, Ellsworth claims, made the verbal agreement to sell her the diner and had been collecting the weekly “good faith” payments.
This reporter left voicemails for Liljana and Nick Lucaj seeking comment, but only Liljana called back.
“There’s not much I can disclose at this time, but we do deny all allegations,” Liljana said. “We are investigating potential embezzlement by Ms. Nicole Ellsworth and that’s all I can disclose at this time.”
“That’s absolutely ridiculous,” said Ellsworth in response to the accusation. “I was paying all of their bills. I have receipts for everything. That’s absolutely crazy.”
“I (hadn’t been) taking a full paycheck since April because I was dumping all the money back into the business,” she added.
The day before the locks were changed, Ellsworth sent an e-mail to the property management company because she claims she received a call from someone identifying himself as Nick’s son, “stating he would be here to change the locks tomorrow, saying I had no right to do what I did . . . He told me this place was sold, and we have to leave.”
But Ellsworth said when she spoke with Nick the next day, he told her “nothing like that was happening.”
“Everything was fine,” she said. “He said he has no idea what is going on, that’s not the case.”
But the locks did get changed, resulting in the current situation.
For months, Ellsworth said she had been operating under the belief the diner was going to be hers.
She had managed the restaurant for three years, starting back when it was originally called Lili’s Diner. The name changed to the 5-1 Diner last year.
In April of this year, Ellsworth said Nick came to her and asked her if she wanted the restaurant. She jumped at the opportunity.
“If I could be the boss and I could do things my way, then this is where I wanted to be,” she said. “I was the backbone of the restaurant. They were my recipes. They were my customers. I said absolutely I want the restaurant.”
Ellsworth said she and Nick Lucaj agreed verbally that she would buy the business, but there was never a written contract. She didn’t think she needed one.
“I just was too trusting,” Ellsworth said. “I had been there. It’s not like I just walked in off the street and said, ‘Oh, I want to buy a restaurant with no contract.’ It didn’t go down like that. I worked there. I trusted him. (It was) my fault, but it still doesn’t give them the right to do what they did.”
Despite this verbal agreement, Ellsworth said, “We hadn’t really determined a price yet.”
She said Nick Lucaj wanted $250,000 and she countered with $150,000. “Which is more than it’s even worth, but I love the place and I wanted it,” Ellsworth said.
What was agreed upon, according to Ellsworth, is that she would have control of the diner, they would attempt to agree on a sale price and “money was not supposed to change hands for six months,” initially.
But after about two weeks, she said Nick Lucaj started coming around and seeking payments. So, Ellsworth said she started making “good faith” payments to him on a weekly basis.
According to an Aug. 30 letter from Ellsworth’s attorney, the Oxford-based Phillip B. Maxwell, to Liljana Lucaj, she made “approximately six payments” to Nick Lucaj by June 1.
Ellsworth claims she made other payments to him after that, some of which were as much as $1,000.
All of these payments were made in cash, according to Ellsworth, and she never requested or received receipts because, again, she thought she could trust Nick Lucaj.
“I worked for him for three years and I never thought that he would do something like this,” she said.
On top of that, Ellsworth claims she was paying the $2,900-per-month rent even though her name was not the lease. She said she paid rent, from May to August, directly to the property management company.
Ellsworth claims she also took it upon herself to settle the thousands of dollars worth of outstanding debts incurred by the diner prior to her agreeing to buy it.
“Everything was upside down – the water bill, the cable bill, the Edison (bill),” she said. “I started pecking away at it.”
Ellsworth said she and her cook, who was going to be her partner, had been shorting themselves in terms of pay in order to help straighten out the diner’s finances.
“We felt like we were going to be here forever. We didn’t have a problem doing that,” she said.
But apparently, forever ended last week and Ellsworth is now planning legal action.
According to Maxwell’s Aug. 30 letter to Liljana Lucaj, “In order to compensate Ms. Ellsworth for her time and expense, we demand payment of thirty thousand dollars. If we are unable to reach an agreement by the end of the week, we will file suit in Oakland County Circuit Court for redress and to enjoin any pending sale of the property.”
In his letter, Maxwell accuses Nick Lucaj of perpetrating a “fraudulent scheme” and making “false representations” to Ellsworth.
But Ellsworth isn’t looking for a payout.
“I want back in my restaurant and I want the lease,” she said. “I don’t really want money, I want back in. I want to continue the good thing that we were doing. I don’t want a settlement from these people.”
She said the owners can have all their equipment back. “I could get new equipment. I have an investor that’s ready to go,” Ellsworth explained. “The money I was going to give to Nick, I will buy new equipment with (it).”
Ellsworth isn’t just concerned about herself in all this. She’s also worried about the 15 people she employed at the diner.
“They’re all out of work,” she said.
Her employees are definitely concerned about their futures.
“Now, I have no income,” said former 5-1 Diner waitress Kayla Hart, who had worked there for a year-and-a-half. “I just came home from vacation and now, I can’t go and make money for next week.”
“Things are very tight right now,” said Maria Johnston, who had waited tables at the diner for three years.
These waitresses are just as mad as Ellsworth about the situation at the diner, which, they, too, view as unjust.
“It’s just not right,” Johnston said. “They’re not going to get very far. I don’t foresee people coming in here anymore.”
“Seriously, like shame on you,” Hart said.
They both enjoyed working there.
“I liked my customers. It was a cute little restaurant. Good vibes,” Hart said.
“I loved it. I loved working for Nicole. She was a great boss,” Johnston said. “We’re just a big family here.”
Families stand up for each other, which is what a small group of community members did on Aug. 31 when they staged a protest in front of the diner decrying the lockout and supporting Ellsworth’s claim. “The community wants us here,” Ellsworth said.
Adults and kids alike waved their signs and received plenty of honks and thumbs-up gestures from drivers.
“I would have been disappointed in myself if I didn’t come out and support (Ellsworth) and the diner,” Cordes said. “I think the community should rally around Nicole and say we don’t want this.”
“It’s just not right what they did to them, to take the restaurant from under them,” Towlerton said. “People are out of jobs now because of it, without any notice.”
Rose brought her children, Jack, 5, and Liam, 3, to the protest. Each carried a little sign.
“I think it’s important to teach them things like this,” she said. “We’ve got to stand up and speak out when things happen to people that aren’t right. We’re a small community and I think your voice can be stronger because of it.”
Come on! No contract, no agreed upon price, no receipts! Why would you not change the locks when you bought it? Why would you not put the lease and utilities in your name. It may very well be what she is saying, but when you take all the above into account it seems fishy.