text:
    527 A.2d 577
    Allen L. SWANSON, Appellant, v. Clarence E. CARLSON and Barbara A. Carlson.
    Superior Court of Pennsylvania.
    Argued April 30, 1987.
    Filed June 22, 1987.

      Marcia M. Ziki, Warren, for appellant.
    H. Robert Hampson, Warren, for appellees.
    Before CIRILLO, President Judge, and MONTEMURO and TAMILIA, JJ.
   CIRILLO, President Judge:

This is an appeal from a judgment on the pleadings granting appellees the right to harvest hay on land that they had leased to appellant. We affirm.

The issue presented on appeal is whether the doctrine of emblements entitled appellant to harvest hay on land that he leased from the appellees.

The record indicates that appellant Allen Swanson leased 26 acres of farmland from appellees Clarence and Barbara Carlson. Appellant used the farmland to grow hay for use in his dairy farm. The lease arrangement began in 1972, with year-to-year terms. Appellant planted a type of hybrid hay known as “birds-foot trefoil.” This hybrid hay was used as fodder for cattle.

Appellant sought damages that allegedly stemmed from appellees’ refusal to permit him to harvest hay during 1985. Appellant’s lease was terminated as of May 1985. The trial court opinion informs us that appellant admitted to being in arrears on his 1985 rental payments. Appellant argues that he is entitled to the harvested hay for 1985 based on the doctrine of emblements. This appeal followed the trial court’s rejection of that argument.

The Pennsylvania case law in this area is both sparse and old. Emblements are crops which are produced annually, not spontaneously, but by labor and industry. Reiff v. Reiff, 64 Pa. 134, 137 (1870). Emblements are also referred to as fructus industriales, id., or “way-going crops.” The classification of crops as emblements impacts on the right of a tenant to those emblements after the termination of his tenancy.

Under certain circumstances, the doctrine of emblements entitles a tenant to crops planted during his lease, but not ready for harvest until the termination of his tenancy. W. Burby, Real Property 18 (1965) (citing Edghill v. Mankey, 79 Neb. 347, 112 N.W. 570 (1907)). The “doctrine is premised on the policy of avoiding waste of land and the equity that a tenant should be entitled to the crops or their value since it was his labor that produced them.” Gallager v. Nelson, 383 N.W.2d 424, 425 (Minn.App.1986) (citing Anderson v. Bureau of Indian Affairs, 764 F.2d 1344,1347 (9th Cir.1985)).

There is an indication that “in some states, the right of a tenant for years to ‘way-going’ crops is recognized if special circumstances, such as an unusually late season, prevented harvest prior to the termination of the lease.” Burby, supra, at 19 (citing Stultz v. Dickey, 5 Binn. (Pa.) 285 (1812)). The record does not support the applicability of such an exception in this case.

We have previously held that when a tenant sows a crop in the fall which requires a period of ripening greater than the unexpired term of his lease, the tenant has a right to the crop. Commonwealth v. Peterman, 130 Pa.Super. 497, 499, 198 A. 687, 688 (1938) (quoting Marple v. Brister, 63 Pa.Super. 470, 473 (1916)). The Peterman case, however, dealt with the crop of wheat. The doctrine of emblements applies to wheat, because it is a crop which is the annual product of labor and industry. Annotation, Rights in Respect of Crops as between Estate of Life Tenant and Remainderman, 47 A.L.R.3d 784, 796 (1973).

Hay, however, has been characterized differently. In Reiff v. Reiff, 64 Pa. 134 (1870), the Pennsylvania Supreme Court held that “[t]he growing crop of grass, even if grown from seed, and though ready to be cut from hay, cannot be taken as emblements: because ... the improvement is not distinguishable from what is natural product, although it may be increased by cultivation.” Id. at 137 (citation omitted). The Reiff Court concluded by observing that the “learned trial judge ... is a practical farmer, thoroughly acquainted with the established usages of our state, and we have no hesitation in agreeing with him that this crop of hay was not emblements.” Id.

Although more than a century old, the decision in Reiff thaX hay is not subsumed by the term emblements is still good law, and we are bound to follow it according to principles of stare decisis. Cf. 47 A.L.R.3d supra at 789 n. 16 (citing contrary viewpoint).

Appellant argues that the law should change in recognition of new developments in agronomy and horticulture, which have produced hybrids of hay which are sold as cash crops and commodities. Notwithstanding the potential merits of appellant’s argument, we are bound to apply the law of Pennsylvania as it now exists. As an intermediate appellate court, we are not free to choose which Supreme Court precedents to follow.

Thus, we base our decision on the Pennsylvania Supreme Court’s determination that the doctrine of emblements does not apply to hay. Therefore, the trial court must be affirmed.

ORDER AFFIRMED.

      . See generally, 21A Am.Jur.2d Crops §§ 2, 25; Annotation, Rights as Between Landlord and Tenant, In Respect of Crops Unharvested at Expiration of Tenancy (Doctrine of Emblements), 141 A.L.R. 1240 (1942); Restatement of Property § 121; Restatement (Second), of Property § 12.3, illustration 4 and comment i. See also Bowser v. Patton, 161 Pa.Super. 284, 53 A.2d 839 (1947) (discussing crop of winter grain).

      . Hay is defined as "herbage and esp. grass mowed and cured for fodder.” Webster’s Ninth New Collegiate Dictionary 557 (1986).

      . See generally 13 Pa.C.S. § 2105 comment 1. (Uniform Commercial Code places hay in the category of goods).

      . For a discussion of the role played by intermediate appellate courts, see Spaeth, Achieving a Just Legal System: The Role of State Intermediate Appellate Courts, 462 Annals 48 (1982); Hopkins, The Role of an Intermediate Appellate Court, 41 Brooklyn L.Rev. 459 (1975).


source: Caselaw Access Project

author: POPOVICH, Judge:

license: Public Domain

text:
    527 A.2d 579
    COMMONWEALTH of Pennsylvania v. Arthur OGNIBENE, Appellant.
    Superior Court of Pennsylvania.
    Submitted April 6, 1987.
    Filed June 25, 1987.

      Stanton D. Levenson, Pittsburgh, for appellant.
    Robert L. Eberhardt, Deputy District Attorney, Pittsburgh, for Com., appellee.
    Before KELLY, POPOVICH and WATKINS, JJ.
   POPOVICH, Judge:

This is an appeal from an order denying a petition under the Post Conviction Hearing Act (PCHA). We affirm.

In 1984, appellant, Arthur Ognibene, entered a plea of guilty to a charge of theft by unlawful taking or disposition, 18 Pa.C.S.A. § 3921 and was subsequently sentenced to a term of 7 years probation and ordered to pay $8000 restitution. In 1986, appellant filed the instant petition requesting he be permitted to withdraw his guilty plea because counsel had rendered ineffective assistance.

Appellant raises two issues in his appeal to this court: 1) trial counsel was ineffective for failing to file a motion to supress; and, 2) trial counsel was ineffective for failing to file a motion to dismiss.

It is axiomatic that the standard of review in determining whether counsel rendered ineffective assistance necessitates an initial inquiry into the underlying claim. Commonwealth v. Hubbard, 472 Pa. 259, 372 A.2d 687 (1977). Only if an underlying claim is found to be of arguable merit, do we proceed to determine whether there existed a reasonable basis for counsel’s actions designed to protect the client’s interests. Commonwealth ex. rel. Washington v. Maroney, 427 Pa. 599, 235 A.2d 349 (1967).

We agree with the PCHA judge’s determination that under existing case law, neither claim is of arguable merit. The factual background is as follows. Appellant was employed by the Aloe Coal Company when company officials discovered equipment was being stolen. Appellant was related to the Aloe family, and in August, 1983, appellant was presented with a letter of resignation and told that if he signed it and helped with an internal investigation, he would be paid the balance of his 1983 salary and health benefits. Appellant did so. In September, 1983, at a meeting with the Aloe Brothers and the company’s attorney, appellant was informed he would not receive the money or benefits unless he made a full statement. He was told the statement was to be stenographically recorded but would not be used to prosecute him. Appellant did not receive the money nor benefits, and the statement was turned over to the police.

Appellant now contends trial counsel was ineffective for failing to file a motion to suppress this confession. Appellant argues that he was never advised of his Miranda rights, Miranda v. State of Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966), and he was induced by promises that the statement would not be used against him. However, as conceded by appellant, the Fifth Amendment proscribes only governmental action and is not applicable to the actions of private individuals unless they are acting as instruments of the state. United States v. Jacobsen, 466 U.S. 109, 104 S.Ct. 1652, 80 L.Ed.2d 85 (1984).

In the area of the Fourth Amendment; in order to determine whether a private individual was acting as an instrument of the state, we look to the purpose of the private individual’s search, the party who initiated it, and, whether the government acquiesced in it or ratified it. Commonwealth v. Cieri, 346 Pa.Super. 77, 499 A.2d 317 (1985). While this same standard is applicable to Fifth Amendment confessions, we do not accept appellant’s theory that the Commonwealth has “ratified” the actions of the private individuals and therefore, the taint of the illegal action was transferred to the government.

Appellant bases his ratification theory upon the proposed use of the confession as evidence by the Commonwealth. It is clear that the initial actions by the private individuals in obtaining the confession were not prompted by government officials. Our Pennsylvania Supreme Court has held that individual acts do not become imbued with the character of state action merely because they are relied upon and used by the Commonwealth in furtherance of state objectives. “The mere use by police and prosecutors of the results of an individual’s actions does not serve to ‘ratify’ those actions as conduct of the state.” Commonwealth v. Corley, 507 Pa. 540, 547, 491 A.2d 829, 832 (1985).

Just as we find trial counsel not to be ineffective for failing to file a motion to suppress which would have been properly denied, we also find no error in the failure to file a motion to dismiss. Pa.R.Cr.P. 314 states:

When a defendant is charged with an offense which is not alleged to have been committed by force or violence or threat thereof, the court may order the case to be dismissed upon motion and a showing that:
(a) the public interest will not be adversely affected; and
(b) the attorney for the Commonwealth consents to the dismissal; and
(c) satisfaction has been made to the aggrieved person or there is an agreement that satisfaction will be made to the aggrieved person; and
(d) there is an agreement as to who shall pay the costs, (emphasis added)

We agree with the PCHA court’s determination that satisfaction had not been made and hence, any motion to dismiss would have been futile.

Order affirmed.


author: PER CURIAM: WIEAND, Judge,

text:
    527 A.2d 1008
    D.A. HILL COMPANY CLEVETRUST REALTY INVESTORS, Appellant. ERIE FLEXUME SIGN CORPORATION and Felheim Roofing Company v. CLEVETRUST REALTY INVESTORS, Appellant.
    Superior Court of Pennsylvania.
    Argued Sept. 3, 1986.
    Filed May 5, 1987.
    Reargument Denied July 7, 1987.

      James M. Baggett, Pittsburgh, for appellant.
    Eugene J. Brew, Jr., Erie, for D.A. Hill, appellee.
    John R. Wingerter, Erie, for Erie Flexume, appellee.
    Before CAVANAUGH, WIEAND and JOHNSON, JJ.
   PER CURIAM:

Affirmed.

WIEAND, J., files a dissenting opinion.

WIEAND, Judge,

dissenting:

A careful review of the evidence in this case persuades me that D.A. Hill Company (Hill) and Felheim Roofing Company (Felheim) failed to prove causes of action for unjust enrichment against CleveTrust Realty Investors, Inc. (CleveTrust). Therefore, I must respectfully dissent from the majority’s affirmance of the judgments entered by the trial court.

CleveTrust agreed to provide construction financing for the Edinboro Mall in Erie County pursuant to a construction loan agreement with Edinboro Development Company (Ed-inboro), the owner of the land. Pursuant to the terms of that agreement, CleveTrust was to advance the sum of $2,200,000.00 for the construction of the mall, with the loan being secured by a first mortgage. Edinboro then engaged a general contractor, Drakes Mills Development Co., to perform the construction work. Hill and Felheim were subcontractors on the job.

Construction began in March, 1974. The established payment procedure was for each subcontractor to submit to the general contractor cost invoices for labor and materials which it had provided during the preceding month. After receiving the invoices, the general contractor would prepare an application for payment which was then given to an architect, who was selected by CleveTrust, for approval. The amount requested in each application for payment was itemized by the general contractor according to forty-eight descriptive categories of work performed by subcontractors. In any given application for payment, however, it was possible for the amount invoiced by a single contractor to be reflected in more than one category of work, and for the work of more than one subcontractor to be included within each category. The names of the subcontractors performing work under each category were not disclosed on the applications. Following approval by CleveTrust’s architect, each application for payment was forwarded to the property owner who, in turn, sent the application to CleveTrust for payment. Upon receipt of these applications for payment, CleveTrust wired the requested amount to a title company with instructions to disburse the funds to the property owner. The owner would then issue a single check to the general contractor in an amount sufficient to pay the invoices of the subcontractors. Each of the first eight applications for payment submitted by the general contractor were paid by CleveTrust.

On November 1, 1974, the owner of the mall defaulted in the terms of the loan agreement by failing to make a required payment of interest. Five days later, CleveTrust received from the owner the ninth application for payment. Exercising its right under the construction loan agreement, CleveTrust refused to disburse further funds. At the time of Edinboro’s default, CleveTrust had advanced a total of $1,903,891.13.

Upon learning of the property owner’s financial difficulties, the general contractor stopped work in December, 1974. Thereafter, several subcontractors, including Hill and Felheim, filed mechanics’ liens against the owner to recover costs of labor and materials for which they had not been paid. When the owner refused to pay their claims, the subcontractors commenced an action in assumpsit against the owner and the contractor based on their mechanics’ lien claims. Edinboro, the owner, filed a motion for summary judgment, arguing that the subcontractors’ claims were barred by waivers of the right to file mechanics’ liens which had been signed by the general contractor and filed prior to the commencement of construction. The trial court agreed and granted the owner’s motion for summary judgment. A panel of this Court affirmed. Hill v. Edinboro Development, Inc., 278 Pa.Super. 324, 420 A.2d 562 (1980).

The owner failed to make monthly interest payments due for the month of December, 1974, and for the months of January and February, 1975. On February 19, 1975, therefore, CleveTrust instituted foreclosure proceedings on its first mortgage. After the owner had filed a petition for bankruptcy, the trial court appointed a receiver to manage Edinboro’s assets and to operate its business. CleveTrust’s foreclosure action was thereafter stayed. When this stay was subsequently removed, the sheriff, on December 12, 1975, sold the mall property to CleveTrust for taxes and costs in the amount of $120,921.05. The deed to the mall property was recorded on May 27, 1976.

Nearly five years later, the appellee-subcontractors instituted actions in equity against CleveTrust on the theory that CleveTrust had been unjustly enriched when it purchased the mall, because it had received the benefit of appellees’ work on the project without having advanced the total amount of loan funds. CleveTrust, in its answer, contended that it had not been enriched because the value of the mall at the time when it acquired title had been less than the amount of loan funds which it had advanced. Moreover, CleveTrust contended, the funds which it had advanced to the owner for the categories of work performed by subcontractors had exceeded the cost of labor and materials which the subcontractors had invoiced and for which they had been paid.

The cases were consolidated for trial without jury. At the conclusion thereof, the trial court held that because CleveTrust had only advanced $1,903,000.00 of its $2,200,-000.00 loan commitment, the subcontractors were entitled to full recovery of their claims on grounds that CleveTrust had been enriched unjustly. CleveTrust filed exceptions to the trial court’s decision, and these were reviewed by the court en banc. That body remanded the case to the trial court for reconsideration in light of this Court’s decision in Gee v. Eberle, 279 Pa.Super. 101, 420 A.2d 1050 (1980). According to Gee, the court en banc explained, the key issue was whether sufficient funds had been disbursed by CleveTrust to satisfy appellees’ claims. The trial court conducted a hearing on this issue, after which it entered an order awarding $27,674.60, plus six percent interest, to Hill and $10,887.20, plus interest, to Felheim. CleveTrust’s exceptions to this second adjudication by the trial court were dismissed, and judgments were entered on behalf of Hill and Felheim in the amounts which had been awarded by the trial court. CleveTrust appealed.

“The applicable standard of review in the consideration of an appeal from a final order in equity is well-settled. The findings of fact of a chancellor have the effect of a jury verdict and if based on legally competent and sufficient evidence, will not be disturbed on appeal. Snellbaker v. Herrmann, 315 Pa.Super. 520, 462 A.2d 713 (1983); August Petroleum Co. 77B v. Casciola, 303 Pa.Super. 374, 449 A.2d 735 (1982); Wright v. Buckeye Coal Co., 290 Pa.Super. 231, 434 A.2d 728 (1981). However, it is the duty and function of [a reviewing] [c]ourt to scrutinize the inferences and legal conclusions drawn from those facts. Silo Realty Corp. v. Redevelopment Authority of City of Philadelphia, 289 Pa.Super. 67, 432 A.2d 1053 (1981); McDole v. Duquesne Brewing Co. of Pittsburgh, 281 Pa.Super. 78, 421 A.2d 1155 (1980). If an error of law or an abuse of discretion [has been] committed, the decision of the [trial court] must be reversed. Dudash v. Dudash, 313 Pa.Super. 547, 460 A.2d 323 (1983).” Biglan v. Biglan, 330 Pa.Super. 512, 518, 479 A.2d 1021, 1024 (1984).

Apart from special statutory rights and a possible recovery for unjust enrichment, the decided cases hold unequivocally that a subcontractor who has furnished labor and/or materials for construction on the land of another has no right to recover therefor against the landowner, or against a construction lender, in the absence of a contractual relationship between them. See: Annot., Building and Construction Contracts: Right of Subcontractor Who Has Dealt With Primary Contractor to Recover Against Property Owner in Quasi Contract, 62 A.L.R.3d 288 (1975). In the instant case, the subcontractors did not enjoy a contractual relationship with the lender, and the subcontractors had also waived the right to assert a claim under the Mechanics’ Lien Law. Therefore, they attempted to establish a cause of action on the grounds of unjust enrichment.

The theory of unjust enrichment is founded on the principle that when a person receives a benefit from another, and it would be unconscionable for the recipient to retain that benefit, equity can be done only by requiring the recipient to make restitution. See: Myers-Macomber Engineers v. M.L.W. Construction Corp., 271 Pa.Super. 484, 490, 414 A.2d 357, 360 (1979). In order to recover under the theory of unjust enrichment, “there must be both (1) an enrichment, and (2) an injustice resulting if recovery for the enrichment is denied.” Meehan v. Cheltenham Township, 410 Pa. 446, 449, 189 A.2d 593, 595 (1963). The burden of proving the existence of these elements is upon the party seeking restitution. See: 66 Am.Jur.2d Restitution and Implied Contracts § 88.

For purposes of analyzing a claim for unjust enrichment, an “enrichment” is deemed to be the value of the benefit conferred by the claimant upon the adverse party. See: Id. In order to show that a financial benefit has been conferred, the party seeking restitution “cannot merely allege its own loss as the measure of recovery, i.e., the value of the labor and material expended — but instead must demonstrate that [the lender] has in fact been benefitted.” Meehan v. Cheltenham Township, supra, 410 Pa. at 450, 189 A.2d at 595 (footnote omitted). “Where the value of the benefit differs from the amount of the loss, and the recipient is free from fault, the amount of recovery is generally limited by the value of the benefit.” Id. n. 5, citing Restatement, Restitution § 1, comment e (1936). See: Berman v. Herrick, 346 F.2d 116, 118 (3d Cir.1965), quoting West v. Peoples First National Bank & Trust Co., 378 Pa. 275, 286, 106 A.2d 427, 433 (1954). Thus, where a subcontractor seeks restitution for work performed on a construction project, recovery by the subcontractor will be measured by the value of the benefit conferred by the subcontractor, not by the rates or prices charged by the subcontractor for labor and materials expended during the project. See: Berman v. Herrick, supra; Meehan v. Cheltenham Township, supra. See also: Annot., supra, 378 Pa. at 292, 106 A.2d at 427.

The subcontractors in the instant case failed to prove the extent to which the shopping mall had been enhanced, if at all, by their work. They offered only their unpaid invoices. These invoices, however, reflected the costs of labor and material expended and also profit allowed by their agreements with the general contractor. Under these circumstances, it cannot accurately be said that the invoices represented benefit received by CleveTrust as a result of work performed and materials supplied by the subcontractors.

Moreover, “[i]f the lender has in fact made advances to pay for the work of a subcontractor, it has satisfied its obligation — so far as it is concerned, it has paid for the work — and the subcontractor may not claim part of the proceeds of the profit [if the premises are resold] on an unjust enrichment theory. If, however, the lender has not made advances to pay for the work of the subcontractor, the subcontractor may be entitled to recover from the lender on a claim of unjust enrichment.” Gee v. Eberle, supra 279 Pa.Super. at 123, 420 A.2d at 1062 (emphasis added). Thus, each subcontractor’s claim must be carefully examined to determine whether it was covered by prior advances made by the lender. Where the amount disbursed by the lender exceeds the value of the subcontractor’s work, the subcontractor’s claim for unjust enrichment will fail even though he did not in fact receive all of the sums advanced. Id., 279 Pa.Superior Ct. at 120, 420 A.2d at 1061.

Felheim was unable to show that CleveTrust had failed to advance moneys sufficient to cover its invoices prior to the owner’s default. Felheim had performed work under categories ten and eleven. It had invoiced CleveTrust a total of $77,900.00. CleveTrust had advanced $97,984.80 for work done on these categories. Of this amount, $58,760.00 had been paid to Felheim by the general contractor. Although the trial court found that other subcontractors had also done work under these categories, there is no evidence with respect to the work which they had done or the amount which they had invoiced for such additional work. Thus, the record does not support Felheim’s contention that Cleve-Trust’s advances were insufficient to pay its invoice in full. Because the amount advanced by CleveTrust ($97,984.80) exceeded the amount invoiced by Felheim ($77,900.00), Fel-heim’s evidence failed to establish that CleveTrust had been unjustly enriched by virtue of the work which Felheim had performed.

Even if the subcontractors had been able to establish that CleveTrust was benefitted by the work which they had performed, they would not be entitled to recover from the lender unless the lender were enriched unjustly. This, too, the subcontractors failed to prove. Under the circumstances of this case, it would not have been unjust to deny the subcontractors’ claims. “The legislature in Pennsylvania has by statute provided the mechanics’ lien as a means by which a contractor or subcontractor can obtain security for work done.” Myers-Macomber Engineers v. M.L.W. Construction Corp., supra 271 Pa.Super. at 491, 414 A.2d at 361. The appellee-subcontractors elected to forego this remedy. They consented to a waiver of their rights to file mechanics’ liens prior to the commencement of construction and relied upon the credit of the general contractor. Equitable principles do not require or even recommend that the subcontractors be permitted to seek restitution five years later from the construction lender whose conduct throughout the period after the owner’s default was proper and in keeping with its rights under the construction loan agreement. This is especially true in view of the fact that the value of the mall at the time it was purchased by the lender at sheriff’s sale was not shown to exceed the sums which it had advanced or the loss which it had sustained as a result of the owner’s default.

It was undisputed that CleveTrust had advanced the sum of $1,903,891.13 for mall construction. At the time of the sheriff’s sale, CleveTrust notes, its claim for unpaid principal, interest and penalties was in the amount of $2,227,-400.00. The trial court did not make a finding with respect to the value of the mall at the time of the sheriff’s sale but found that the mall at the time of default, a year prior to the sheriff’s sale, had an approximate value of $2,000,000.00. At this time, the estimated cost of completing the mall was $100,000.00. Thus, the evidence did not show that the lender had acquired an asset whose value exceeded the advances and costs which the lender had paid for it. Under these circumstances, the equities of the lender were equal or superior to those of the subcontractors.

I would reverse the judgments entered in favor of the subcontractors.

      . Judgment was also entered for George H. Althof, Inc. Although CleveTrust filed a notice of appeal from this judgment to No. 1532 Pittsburgh, 1985, that appeal has been discontinued. The propriety of the judgment entered for George H. Althof, Inc., therefore, is not before this Court.


author: WIEAND, Judge:

text:
    527 A.2d 1012
    Barry ECK, Appellant, v. POWERMATIC HOUDAILLE, DIVISION OF HOUDAILLE INDUSTRIES, INC., a corporation, and Hermance Machine Company, a corporation, Appellees. Barry ECK v. POWERMATIC HOUDAILLE, DIVISION OF HOUDAILLE INDUSTRIES, INC., a corporation, and Hermance Machine Company, a corporation. Appeal of POWERMATIC HOUDAILLE, DIVISION OF HOUDAILLE INDUSTRIES, INC., a corporation. Barry ECK v. POWERMATIC HOUDAILLE, DIVISION OF HOUDAILLE INDUSTRIES, INC., a corporation, and Hermance Machine Company, a corporation. Appeal of HERMANCE MACHINE COMPANY, a corporation.
    Superior Court of Pennsylvania.
    Argued Feb. 20, 1987.
    Filed June 1, 1987.

      Louis C. Long, Pittsburgh, for Eck, appellant, (at 441) and appellee (at 473 and 474).
    Richard A. Gray, Williamsport, for Powermatic, appellant (at 473) and appellee (at 441 and 474).
    John P. Pietrovito, Williamsport, for Hermanee, appellant (at 474) and appellee (at 441 and 473).
    Before WIEAND, OLSZEWSKI and TAMILIA, JJ.
   WIEAND, Judge:

In the instant appeal, we are asked to determine the role of “foreseeability” in a “substantial change” defense asserted in a product liability action. The trial court charged the jury that any substantial change made to a product by a user or consumer would relieve the manufacturer and distributor of the product from liability for injuries caused thereby. Plaintiff-appellant argues that the jury should have been instructed that the manufacturer and distributor would be absolved of liability only for subsequent product modifications which were unforeseeable. We agree. Because we conclude that this erroneous instruction may have affected the verdict which the jury returned in favor of the manufacturer and distributor, we reverse and remand for a new trial.

On January 6, 1983, Barry Eck suffered injuries to his left hand when his arm came in contact with the rotating blade of an electrically-powered, tilting arbor saw. The saw had been manufactured by Powermatic Houdaille (Power-matic) and had been sold by Powermatic to Hermanee Machine Company (Hermanee), a commercial distributor of Powermatic saws. Hermanee, in turn, had sold the saw to Joseph Shumbat for use in his construction business. The saw, as manufactured by Powermatic and sold to Hermanee and Shumbat, contained a safety guard to prevent the hands of the operator from coming into contact with the blade of the saw while the saw was being operated. After purchasing the saw from Hermanee, Shumbat removed the safety guard and permanently fastened a “shim” with a formica covering to the fence of the saw. This was done to prevent pieces of wood from becoming caught in the saw during operation. Shumbat subsequently sold the saw, in its altered condition, to Eck, who was operating the saw in its altered condition at the time of the accident.

Eck commenced an action against Powermatic and Her-manee, alleging, inter alia, that the defendants were strictly liable for his injuries under Restatement (Second) of Torts § 402A. Specifically, he contended that the saw had been defective because, inter alia, it could not be operated to perform certain functions without removing the guard, the guard could too readily be removed by the operator, and it contained a warped fence which caused the pieces of wood being cut to “bind,” thereby increasing the possibility that the operator’s hands would be drawn toward the blade .of the moving saw. The defendants’ primary defense was that the saw had not been defective when sold in its original form to Shumbat, but had become defective, if at all, only after Shumbat had removed the safety guard and fastened a “shim” to the fence.

With respect to the issue of substantial change, the trial court instructed the jury as follows:

A seller, manufacturer or distributor is responsible only for such defects as exists at the time the product leaves its control. The seller, manufacturer or distributor is not liable for defective conditions created by substantial changes in the product occurring after the product has been sold. So even if you find the saw in question was defective it is for you, the Jury, to then decide whether the defect originated at the time of the sale by the Defendant, Powermatic and Hermanee or whether the defect originated as a result of the actions of Ernest L. Shumbat Company in removing the guard or failing to supply the manuals, and adding the shim. And I am going to read that again because I think you should hear it in a cohersive [sic] manner. Even if you find the saw in question is defective it is for you, the Jury, to decide whether that defect originated at the time the sale was made by the Defendant, Powermatic and Hermanee, or whether the defect resulted as a result of the actions of Ernest L. Shumbat and Company by removing the guard, failing to supply the manuals and adding the shim. If you find that the shim was permanently fastened to the fence of the saw by Ernest L. Shumbat Company, Inc. or that its agents or employees ... constituted substantial change in the condition of the saw before it reached the Plaintiff then Hermanee Machine Company and Power-matic are not liable to the Plaintiffs injuries. In other words, if you find that the fastening of the shim to the saw by Shumbat was a substantial change in the condition of the saw then the Defendants would not be liable. If you find that the removal of the guard and the failure to supply the guard to Barry Eck by Ernest L. Shumbat Company, Inc. constituted a substantial change in the condition of the saw before it reached Barry Eck then the Defendants Hermanee and Powermatic are not liable for the Plaintiffs injuries if the Plaintiffs injuries were caused by the failure to have a guard. If you find the shim was permanently fastened to the fence of the saw by Ernest L. Shumbat or its agents or done in an improper manner then such alteration of the saw could constitute a substantial change in the condition of the saw.

Immediately thereafter, the trial court invited counsel to object or suggest additions to the jury instructions. The following colloquy between counsel for Eck and the trial court occurred:

By Mr. Eck:
I have some, your Honor. Charge to Jury that if they found a substantial change by Shumbat, and if it was a cause in the injury ...
By The Court:
Substantial.
By Mr. Eck:
Then the Defendants are relieved of liability. I believe the proper charge is, that if a substantial change was caused by the actions of the Defendants or was anticipated by the Defendants, [then] that substantial change is not a defense.
By The Court:
Okay.
By Mr. Eck:
I think we have got a real problem here.
By Mr. Eck:
For this reason, that if they find the Shumbat shim was a substantial factor and caused the accident, but assuming they also find that this shim was put on because of a warp condition that Shumbat didn’t create, that it existed at the time of the sale, you then have a defect, but he attempted to correct the defect, the defect still existed and his intervening negligence is not a defense. That is where I think we have got a serious problem, that is why I objected yesterday because I thought we agreed it should not be a part of this proceeding. It makes it I think a serious problem.
By The Court:
Okay.
By Mr. Eck:
So I think they ought to be told two things. I seriously object to the charge of substantial change as relieving the defense because I think it only relieves the Defendants if they didn’t cause it. If they cause a defect and admittedly it is a defect they can’t exonerate themselves by saying, oh, the guy didn’t fix my defect right is what you are saying, then that is a problem.
By The Court:
They have to find the substantial change itself was the cause.
By Mr. Eck:
I agree.
By The Court:
Okay, I understand your argument.
By Mr. Eck:
The first issue I have no problem.
By The Court:
I am going to deny the request to add to the questions or to change the charge regarding substantial change after the saw left the hands of Hermanee and Powermatic.

Transcript of Sidebar Discussion at 2-4 (emphasis added). No further instructions were given by the trial court with respect to the issue of substantial change, and the case thereafter was submitted to the jury.

The jury was provided with a verdict form in which they were asked to answer seven special interrogatories. These questions, and the jury’s responses thereto, were as follows:

1. Was the guard assembly, supplied with the subject saw, defective when it was sold by the Defendants, Powermatic and Hermanee Machine Company, in 1980?
x Yes _No
2. Was the cast iron fence, supplied with the subject saw, defective when it was sold by the Defendants, Powermatic and Hermanee Machine Company, in 1980.
x Yes _No
Note: If your answered “No” to both questions #1 and #2, stop and do not answer any of the following questions. If you answer “Yes” to either question #1 or #2, answer question #3.
3. Was the defect or defects found by you in answering question #1 or question #2 a substantial factor in bringing about the accident of January 6, 1983?
_Yes x No
Note: If your answer to question #3 is “No,” stop and do not answer any of the following questions. If you answered “Yes” to question #3, answer question #4.
4. Did Plaintiff, Barry Eck, voluntarily assume the risk of his injuries?
_Yes _No
Note: If your answer to question #4 is “Yes” stop and do not answer any of the following questions. If you answered “No” to question #4, answer question #5.
5. Was there a substantial change making the saw defective after it was delivered and left the control of Defendants, Powermatic and Hermanee?
_Yes _No
Note: Answer question #6 only if you answered “Yes” to question #5. If you answered “No” to question #5, do not answer question #6 and proceed to question #7.
6. Was the substantial change found by you in answering “Yes” to question #5 a substantial factor in bringing about the accident of January 6, 1983?
_Yes _No
Note: If your answer to question #6 was “Yes,” stop and do not answer question #7. If your answer to question #6 was “No” proceed to question #7.
7. Indicate the total amount of damages you award the Plaintiff for the injuries and damages sustained as a result of the accident of January 6, 1983.
Answer $_

On the basis of the jury’s answers to these interrogatories, a verdict was entered for the defendants.

Eck filed a motion for new trial in which he contended that the charge of the trial court on the issue of substantial change had been erroneous. He asserted specifically that the court should have instructed the jury that the defendants would not be relieved of liability if the alterations made by Shumbat to the saw were foreseeable. In response to Eck’s motion, the defendants argued, inter alia, that by failing to request such a charge during trial, Eck had waived the right to challenge the court’s instruction.

Following argument, the trial court determined that Eck had properly preserved his objections to the charge. The court also agreed with Eck that its instruction with respect to the issue of substantial change, in fact, had been erroneous. Nevertheless, the court denied Eck’s request for a new trial on the ground that the erroneous portion of the charge had been harmless and had had no effect upon the jury’s verdict. The court observed that the jury, in essence, had made only two determinations: that the saw, as manufactured by Powermatic and sold by Hermanee, was defective; and that the defects in the saw were not a substantial factor in causing Eck’s injuries. Because Eck had failed to make out a prima facie case of strict liability, the court maintained, the jury had not reached the issue of substantial change. As a result, the court concluded, any omission with respect to the substantial change instruction had been harmless. After judgment was entered on the verdict, all parties appealed.

Eck, in his appeal, contends that because the charge of the trial court failed to address the issue of foreseeability, it necessarily had an adverse impact on the jury’s determination of causation. He seeks a new trial limited solely to that issue. The jury’s determination of the saw’s defectiveness, it is asserted, was unaffected by the erroneous charge of the court and, therefore, this issue should not be relit-igated.

The defendants, on the other hand, renew their argument that Eck failed to preserve his objection to the trial court’s instructions concerning the issue of substantial change. The remainder of the defendants’ arguments merely contest the allegations made by Eck in his appeal.

To be entitled to prosecute an appeal, one must have a present interest in the subject matter and must be aggrieved by the judgment, order or decree entered. Elliot Estate, 388 Pa. 321, 323, 131 A.2d 357, 358 (1957); Burchanowski v. Lycoming County, 32 Pa.Cmwlth. 207, 210, 378 A.2d 1025, 1027 (1977). To be an “aggrieved party” for purposes of appeal, a litigant must be adversely affected by the order appealed from and he or she must have some pecuniary interest which is injuriously affected. Pierro v. Pierro, 434 Pa. 131, 132, 252 A.2d 652, 653 (1969). See: Louden Hill Farm, Inc. v. Milk Control Commission, 420 Pa. 548, 551, 217 A.2d 735, 736-737 (1966); Atlee Estate, 406 Pa. 528, 532, 178 A.2d 722, 724 (1962). “When one issue in a case is decided against a party, but the party prevails on the other issues and wins the case in chief, the party cannot claim to have been ‘aggrieved’ by the decision; he therefore lacks standing to appeal the single issue decided against him.” Burchanowski v. Lycoming County, supra. See: Bensalem Township School District v. County Commissioners of Bucks County, 8 Pa.Cmwlth. 411, 303 A.2d 258 (1973).

In the instant case, the jury returned a verdict in favor of the defendants and judgment thereafter was entered on the verdict. The verdict did not injuriously affect any pecuniary interest of the defendants; therefore, they are not “aggrieved” parties who are entitled to pursue an appeal. This is so despite the fact that the trial court determined, adversely to the defendants, that Eck had properly preserved the issue concerning the propriety of the court’s instructions. Because the defendants prevailed and judgment was entered in their behalf, they cannot file a separate appeal merely because a single issue was decided against them. The appeals at Nos. 473 and 474 Harrisburg, 1986, therefore, will be quashed. The arguments advanced by the defendants, however, will be considered in determining the appeal filed by Eck.

In reviewing an order denying a motion for new trial, our scope of review is limited. An order refusing a new trial will be reversed on appeal only where there has been a clear abuse of discretion or an error of law which controlled the outcome of the case. Chesko v. Steinbough, 434 Pa. 82, 84, 252 A.2d 644, 645 (1969); Collins v. Hand, 431 Pa. 378, 382, 246 A.2d 398, 400 (1968); Wood v. Smith, 343 Pa.Super. 547, 550, 495 A.2d 601, 603 (1985); Fannin v. Cratty, 331 Pa.Super. 326, 331, 480 A.2d 1056, 1058 (1984). An erroneous jury instruction may provide the basis for a new trial if it is shown that the instruction was fundamentally in error and that it might have been responsible for the verdict. Hawthorne v. Dravo Corp., Keystone Division, 352 Pa.Super. 359, 368, 508 A.2d 298, 303 (1986).

Preliminarily, we consider whether the issues raised in Eck’s appeal have been properly preserved for appellate review. It is well-settled that a matter not raised in the trial court will not be considered on appeal. Commonwealth v. National Federation of the Blind, 471 Pa. 529, 536, 370 A.2d 732, 736 (1977); Keystone Building Corp. v. Lincoln Savings and Loan Association, 468 Pa. 85, 91, 360 A.2d 191, 194 (1976); Wenzel v. Morris Distributing Co., 439 Pa. 364, 374, 266 A.2d 662, 667 (1970). This includes an alleged error in the jury instructions delivered by the court. Where a party fails to object to a jury instruction, he or she is precluded from assigning the alleged error as a basis for a new trial on appeal. Broxie v. Household Finance Co., 472 Pa. 373, 372 A.2d 741 (1977); Dilliplaine v. Lehigh Valley Trust Co., 457 Pa. 255, 322 A.2d 114 (1974).

Instantly, Eck argues that the jury should have been instructed that the defendants would not be relieved of liability for the injuries caused by Shumbat’s post-delivery modification of the saw if the changes made by Shumbat were foreseeable. Although Eck did not include a specific point for charge on this issue, the record reveals that he did make a verbal request therefor after the trial court had concluded its jury instructions. The record reveals further that Eck’s proposed instruction was, in fact, considered and rejected by the trial court before the case was submitted to the jury. Under these circumstances, we conclude that Eck’s challenge to the charge was properly preserved for appellate review.

Under section 402A(l)(b) of the Restatement (Second) of Torts, a manufacturer or seller of a defective product is liable for harm caused thereby where the product is expected to and does reach the user or consumer without substantial change in the condition in which it has been sold. Interpreting this section of the Restatement, this Court, in D’Antona v. Hampton Grinding Wheel Co., 225 Pa.Super. 120, 310 A.2d 307 (1973), stated that “[t]he test in such a situation is whether the manufacturer could have reasonably expected or foreseen such an alteration [in its product]; such a determination is for the fact-finder unless the inferences are so clear that a court can say as a matter of law that a reasonable manufacturer could not have foreseen the change.” Id., 225 Pa.Superior Ct. at 125, 310 A.2d at 310. Similarly, a plurality of the Supreme Court, in Kuisis v. Baldwin-Lima-Hamilton Corp., 457 Pa. 321, 319 A.2d 914 (1974), opined that “the question whether post-delivery alteration in a product is a superceding cause of harm to a plaintiff may turn on foreseeability as well as causation in fact. If the alteration should have been reasonably anticipated by the seller, it would be a ‘substantial change’ within the meaning of § 402A only if it were negligently or improperly implemented.” Id., 457 Pa. at 333 n. 15, 319 A.2d at 922 n. 15.

These decisions suggest that the concept of “foreseeability” is a significant factor in determining whether a manufacturer or seller will be held responsible for injuries resulting after post-sale modifications of a product have been made. The defendant-appellees argue, however, that the viability of this line of authority has been undercut by the subsequent decision of the Pennsylvania Supreme Court in Azzarello v. Black Brothers Co., 480 Pa. 547, 391 A.2d 1020 (1978). Their argument, stated syllogistically, is as follows: Azzarello precludes the injection of negligence principles into strict product liability actions; “reasonable foreseeability” is a negligence concept; therefore, under Azzarello, the concept of foreseeability may not be used in a strict liability action to elucidate the responsibility of a manufacturer for injuries caused by a product which has undergone substantial alteration after leaving the manufacturer’s control.

A similar argument was rejected by the United States Court of Appeals for the Third Circuit in Merriweather v. E.W. Bliss Co., 636 F.2d 42 (3d Cir.1980). There, the trial court had. refused to charge the jury that reasonably foreseeable changes in a product would not absolve the manufacturer of liability for injuries caused by that product. Instead, the jury was instructed on the issue of substantial change without any reference to reasonable foreseeability. In finding this instruction to be erroneous under Pennsylvania law, the Third Circuit stated:

The court below ... apparently felt that Azzarello had, by implication, overruled [D'Antona and Kuisis and federal decisions which had followed them] and that, under Azzarello, a jury charge on substantial change could not be framed in terms of reasonable foreseeability. We disagree. As we previously noted, the Pennsylvania Supreme Court’s decision in Azzarello simply deleted the phrase “unreasonably dangerous” from jury instructions in product liability cases. It did not purport to address the question of substantial change at all. Moreover, following Azzarello this court has specifically approved jury charges in product liability cases which were framed in terms of reasonable foreseeability. See, Baker v. Outboard Marine Corp., 595 F.2d 176, 183-184 (3d Cir. 1979), (approving an instruction on superseding cause in a product liability case which incorporates reasonable foreseeability). See also, Heckman v. Federal Press Co., [587 F.2d 612 (3d Cir.1978) ]. Therefore we find no precedential basis for the district court’s conclusion that Azzarello has implicitly deleted the phrase reasonably foreseeable from jury instructions on substantial change.
But more fundamentally, we find that the trial court’s instruction was in error because it directly contradicted the policies underlying the Pennsylvania Supreme Court’s decision in Azzarello. In Azzarello the court eschewed the use of the phrase unreasonably dangerous in large part because it felt that that phrase improperly de-empha-sized the duty of the manufacturer to act as the guarantor of his product’s safety. See Azzarello, supra, 480 Pa. at 559, 391 A.2d at 1027. Were we to adopt the approach to the substantial change doctrine accepted by the district court in this case we would significantly undercut this policy. If the manufacturer is to effectively act as the guarantor of his product’s safety, then he should be held responsible for all dangers which result from foreseeable modifications of that product. Yet under the view taken by the court below this would not occur. Rather, once the modification of the product was shown to be substantial the manufacturer would be excused from all liability for injuries caused by that product, even if that modification was clearly foreseeable. As a practical matter, therefore, the district court’s decision broadens considerably the scope of the substantial change defense. Because the broadening of this defense is inconsistent with the concept of the manufacturer as the guarantor of his product, we feel that the charge given by the district court is in direct conflict with Azzarello.

Id. at 45-46.

The analysis in Merriweather is persuasive. Azzarello had no effect upon the established rule of law which requires consideration of “foreseeability” in connection with a “substantial change” defense. As we recently reiterated in Thompson v. Motch & Merryweather Machinery Co., 358 Pa.Super. 149, 516 A.2d 1226 (1986), “[i]f the alteration [in a product] could not reasonably have been foreseen by the manufacturer and if it were a superceding cause of the user’s injury, the manufacturer would be relieved of liability even if there had been design defects existing at the time the [product] was delivered to the purchaser.” Id., 358 Pa.Superior Ct. at 155, 516 A.2d at 1229 (emphasis added). Therefore, it was error in the instant case for the trial court to instruct the jury that any substantial change in the offending power saw would relieve the defendants of liability for the injuries sustained by Eck.

For a new trial to be required, however, it must appear that the erroneous instruction may have affected the jury’s verdict. Defendant-appellees contend that any error in the trial court’s instruction on substantial change was harmless because it could have had no bearing on the outcome of the trial. We disagree.

There is general agreement among legal authorities that “the question of liability of a manufacturer or seller for injuries sustained by the user of an altered product involves the issue of whether the injuries were proximately caused by a defect in the product as manufactured and sold, or by a defect created by the alteration by the user or third party.” Annot., Products Liability: Alteration of Product After It Leaves Hands of Manufacturer or Seller As Affecting Liability For Product-Caused Harm, 41 A.L. R.3d 1251, 1253 (1972). Most courts have held that “a manufacturer or seller is not liable for injuries caused by a defective product if the defect was created by an alteration which amounts to an intervening or superseding cause, as distinguished from a concurrent cause, of the injuries.” Id.

The appellate decisions of this Commonwealth are in accord. In Kuisis v. Baldwin-Lima-Hamilton Corp., supra, it was observed that “courts which have discussed post-delivery alterations in terms of substantial change have treated the problem as one of proximate causation.” Id. 457 Pa. at 333 n. 15, 319 A.2d at 922 n. 15. Aligning itself with these authorities, the Court opined that post-delivery modifications of a product have relevance to the issue of the manufacturer’s liability “only if, individually or in combination, they amounted to a superseding cause of plaintiff’s injuries.” Id., 457 Pa. at 333, 319 A.2d at 922. In a similar vein, a panel of this Court has recently suggested that where a product is defective at the time it is delivered to the user or consumer, the manufacturer will be relieved of liability only if the product was substantially altered after it left the manufacturer’s control, and the modifications made to the product were a superseding cause of the user’s injury. See: Thompson v. Motch & Merryweather Machinery Co., supra 358 Pa.Super. at 154-155, 516 A.2d at 1229.

As is betokened by these decisions, evidence of post-delivery modifications is relevant only to show that the altered product was the cause in fact of the plaintiff’s injuries. To this extent, the issue of substantial change is part and parcel of a causation analysis.

In the instant case, the jury, in response to the interrogatories contained in the verdict slip, determined that the safety guard assembly and cast iron fence of the saw had been defective at the time when it was sold by the defendants. Nevertheless, it was the jury’s conclusion that these defects were not a substantial factor in causing Eck’s injuries. In reaching these determinations, the jury answered only the first three interrogatories appearing on the verdict form. The remaining questions, including numbers five and six which related to the issue of substantial change, were left unanswered. Interpreting the completed verdict form, the trial court determined that because Eck had failed to make out a prima facie case of strict liability, the jury did not reach the defense of substantial change. The court concluded, therefore, that any error in the instruction on substantial change could not have had any effect upon the verdict.

The reasoning of the trial court is faulty. Although it is true that the jury did not respond to the special interrogatories which addressed the issue of substantial change, it is difficult to imagine that the issue could have escaped the jury's consideration. As we have already observed, the issues of substantial change and causation are inseparable. Here, the issue of causation was the focal point of the trial and was hotly contested by the parties. The foundation of defendant-appellees’ defense was that Eck’s injuries had been caused by the modifications which had been made to the saw by Shumbat. Eck argued, on the other hand, that the cause of the accident was the defendants’ failure to design and manufacture the saw in a way that alterations thereto by consumers would have been unnecessary. In deciding the issue of causation, therefore, it was essential for the jury to consider whether and to what extent the saw had been altered by Shumbat before it had been sold to Eck. This remains true even though the trial court erroneously separated the issues of causation and substantial change in the interrogatories on the verdict form. Assuming, as we must, that the jury did consider the issue of substantial change in determining the cause of the accident, the charge of the court with respect to this issue looms significant. Any error in the instructions on substantial change, therefore, in all probability had an impact on the jury’s resolution of the causation issue.

“It is the normal practice in granting a new trial to grant it generally against all parties on all issues.” Stokan v. Turnbull, 243 Pa.Super. 440, 445, 365 A.2d 1305, 1307 (1976), rev’d on other grounds, 480 Pa. 71, 389 A.2d 90 (1978). The power to grant a limited new trial should be exercised cautiously. Gagliano v. Ditzler, 213 Pa.Super. 238, 240, 247 A.2d 632, 633 (1968), aff'd, 437 Pa. 230, 263 A.2d 319 (1970). Troncatti v. Smereczniak, 428 Pa. 7, 9, 235 A.2d 345, 346 (1967); Rosen v. Slough, 212 Pa.Super. 398, 402, 242 A.2d 898, 900 (1968). Where the issues are interwoven and cannot be separated without injustice to one of the parties, the other party should not be permitted to select for retrial the issues decided against him and upon the rehearing treat those issues decided in his favor as settled. Friedman v. Matovich, 191 Pa.Super. 275, 281, 156 A.2d 608, 611 (1959).

In the case sub judice, the court’s erroneous instruction with regard to the issue of substantial change may well have affected the jury’s determination of defectiveness and causation alike, for the two issues were inextricably interwoven. As the authors of one prominent treatise have observed, “when there has been an unforeseeable or uncon-templated alteration in a product ..., it is difficult to determine (1) whether there was ever a defect in the product when sold and (2) if so, whether the defect contributed to the damaging event.” Prosser and Keeton on Torts § 102, at 711 (5th ed. 1984). We hold, therefore, that upon remand the entire issue of liability must be relitigated.

The appeals at Nos. 473 and 474 Harrisburg, 1986 are quashed. The appeal at No. 441 Harrisburg, 1986 is sustained; the judgment is reversed; and the case is remanded for a new trial generally. Jurisdiction is not retained.

      . That section provides as follows:
      (1) One who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property is subject to liability for physical harm thereby caused to the ultimate user or consumer, or to his property, if
      (a) the seller is engaged in the business of selling such a product, and
      (b) it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold.
      (2) The rule stated in Subsection (1) applies although
      (a) the seller has exercised all possible care in the preparation and sale of his product, and
      (b) the user or consumer has not bought the product from or entered into any contractual relation with the seller.

      . The defendants also asserted the defense of assumption of risk.

      . The record indicates that Eck had raised the issue of foreseeability during an in-chambers conference held before the court delivered its charge to the jury. There, counsel for Eck had stated that “if the subsequent changes [made by Shumbat to the saw were] foreseeable, then those are not changes which would insulate a manufacturer” from liability. However, the trial court determined to instruct the jury consistently with Pennsylvania Standard Jury Instruction 8.08, which provides that any substantial change will relieve a product-seller of liability.


author: BROSKY, Judge: ROWLEY, Judge,

text:
    527 A.2d 1021
    ALLSTATE INSURANCE COMPANY v. Samuel K. CLARKE and Lebovitz & Lebovitz, P.A. Appeal of Samuel K. CLARKE.
    Superior Court of Pennsylvania.
    Argued Sept. 9, 1986.
    Filed June 10, 1987.

      Yaier Y. Lehrer, Pittsburgh, for appellant.
    John M. Silvestri, Pittsburgh, for appellee.
    Before BROSKY, ROWLEY and POPOVICH, JJ.
   BROSKY, Judge:

This is an appeal from an order entering summary judgment in favor of Appellee-plaintiff in the amount of $4,007.00.

Appellant has raised two issues in this appeal: (1) whether a subrogee is entitled to full payment when an entire matter has not been litigated and only a portion of the claimed damage has been recovered by settlement; and (2) whether the subrogor may make payment in full less reasonable attorneys fees where the fund against which a subrogee attempts to collect has been created by the work of the attorney for the subrogee.

We have reviewed the record and briefs submitted by counsel and find that the entry of summary judgment was improper under the facts of this case. Accordingly, we vacate the order of the trial court granting summary judgment in favor of appellee.

Appellee, Allstate Insurance Company, instituted the action below seeking the sum of $4,007.00 from appellant, Samuel Clarke. Appellant had insurance coverage provided by appellee on an automobile which was damaged severely in a collision with two other vehicles. Appellee paid the value of the car to appellant who was also seeking damages in legal proceedings against the other two drivers involved in the collision. Appellant received a $100,000 settlement against one of the drivers and his insurance carrier, which represented the extent of liability coverage of the driver, and executed a joint tort-feasor release agreement releasing the driver and his carrier from any further damages. Ap-pellee, who had previously notified appellant of its subrogation interest and after learning of the settlement, demanded repayment of the sum paid to appellant citing a subrogation provision in the insurance contract as grounds for the repayment. Appellant, through his attorneys, notified ap-pellee that the sum in question was being held in escrow pending resolution of the action against the other driver and the City of Pittsburgh, for whom that driver was employed at the time of the collision. Appellee then filed the action which is the subject of this appeal.

Appellant, while acknowledging appellee’s subrogation right, has maintained throughout this case, that appellee’s interest cannot be determined until appellant has resolved all actions and claims arising out of the collision in question. Appellant has maintained this position because it is also his contention that appellee cannot recover, in subrogation, the full amount paid to appellant unless appellant in turn recovers the full amount of his claim against the alleged tort-fea-sors. Given this premise, appellant argues, the percentage of repayment on the subrogation claim cannot be determined until after resolution of the other claim and attempts at subrogation now are both premature and inequitable. Both parties cite in their briefs Associated Hospital Service of Philadelphia v. Pustilnik, infra, in support of their position. We agree that Pustilnik controls the disposition of this case.

Associated Hospital Service of Philadelphia v. Pustil-nik, 262 Pa.Super. 600, 396 A.2d 1332 (1979), (vacated on other grounds), 497 Pa. 221, 439 A.2d 1149 (1981), dealt with a similar factual pattern to the one presently before the Court. In Pustilnik the insured was injured when struck by a subway car operated by SEPTA and was hospitalized on three occasions. Accumulated medical bills approximated $30,000 but Pustilnik was credited with only $18,960.18 under the terms of a subscription agreement with Associated Hospital Service of Philadelphia (Blue Cross). Pustilnik claimed this amount as an element of damages in a suit against SEPTA which settled in its fifth day of trial for $235,000. Blue Cross, having previously notified the insured of its subrogation interest, notified the trial court of its claim as well. Subsequent to the settlement, a trial was held to determine the amount of Blue Cross’ subrogation interest. The court accepted the credited value of $18,-960.18 as a starting point but reduced the amount by 50% because it found the settlement was at less than full value of the damages suffered. The court then made further deductions for attorney’s fees and litigation expenses, both parties filed appeals.

This Court found that the trial court erred in reducing Blue Cross’ subrogation interest by 50% to reflect settlement at less than full value of the claim. Citing Illinois Automobile Insurance Exchange v. Braun, 280 Pa. 550, 124 A. 691 (1924), this Court recited the status of the law in this regard: “that when a subrogor settles instead of pressing his suit against an alleged tort-feasor to verdict, he cannot defeat a subrogee’s claim by asserting that his loss exceeded the settlement recovery.” This Court, after further discussion, concluded that “when a subrogor settles, he waives his right to a judicial determination of his losses, and conclusively establishes the settlement amount as full compensation for his damages.” 396 A.2d at 1338. The appel-lee has quoted extensively our opinion in Pustilnik and argued that it requires a like result here, the immediate repayment in full of the amount paid to the insured under the insurance contract. However, Pustilnik, while similar to this case in most regards, is different in at least one material respect. In Pustilnik, the settlement with SEPTA on the fifth day of trial conclusively terminated the insured’s claim against potential tort-feasors for damages. In the present case, there still is to be resolved Clarke’s claim against the City of Pittsburgh. To understand the distinction it is important to understand the nature of Allstate’s subrogation interest.

It is well established that the action for subrogation is one based on considerations of equity and good conscience. The goal is to place the burden of the debt upon the person who should bear it. The right of subrogation may be contractually declared or founded in equity, but even if contractually declared, it is to be regarded as based upon and governed by equitable principles. Pustilnik, supra. It has often been said that the equitable doctrine of subrogation places the subrogee in the precise position of the one to whose rights and disabilities he is subrogated. Michel v. City of Bethlehem, 84 Pa.Cmwlth. 43, 478 A.2d 164 (1984); Fell v. Johnston, 154 Pa.Super. 470, 36 A.2d 227 (1944). Hence, when an individual who has been indemnified for a loss subsequently recovers for the same loss from a third party, equity compels that the indemnifying party be restored that which he paid the injured party; thereby placing the cost of the injury upon the party causing the harm while preventing the injured party from profiting a “double recovery” at the indemnifying party’s expense. However, as the subrogee stands in the precise position of the subrogor the subrogee should be limited to recovering in subrogation the amount received by the subrogor relative to the claim paid by the subrogee, for equity will not allow the subrogee’s claim to be placed ahead of the subro-gor’s.

Application of the doctrine of subrogation is a relatively easy task when there exists only one element of damage to the insured party. If an individual suffers $5,000.00 damage to an automobile, for example, and is paid this amount pursuant to collision coverage of an insurance contract and then is later successful in recovering $5,000 in a suit for damage to the vehicle against a third party, the insurer is entitled to the $5,000 judgment. If the insured were to recover only $4,000 in a suit against the third party, the insurer would still be entitled to the $4,000. If for some reason, say a favorable valuation of the automobile, the insured were to recover $6,000 against the third party, the insurer would remain entitled to only $5,000, the excess would belong to the insured. However, subrogation becomes increasingly more difficult to apply as the amount of the claim increases and encompasses many elements of damages. If, to use the same example, in a collision an insured sustains not only property damages but personal injury, his claim against the tort-feasor will likely encompass medical bills, loss of earning capacity, lost wages, pain and suffering, and various other elements of personal injury damages in addition to the property damages. If the case goes to verdict and full damages are awarded and later collected, the insurer’s subrogation right would remain easily ascertainable because if the insured recovered in full the subrogee is also entitled to recover in full. However, if after damages are determined, the insured does not recover all of the damages, the insurer’s subrogation rights are more difficult to determine, for the insured, while likely recovering an amount in excess of that paid by the insurer for the property damage, would not have recovered, in full, against the tort-feasor, his claim for property damages or for any other element of damage.

In Pustilnik, Blue Cross had an equitable right to the proceeds of the insured’s settlement with the third party tort-feasor to the extent that settlement reflected payment for hospital expenses incurred by the insured and paid by Blue Cross. This equitable right existed to the extent of Blue Cross’ payment of medical bills on Pustilnik’s behalf and, of course, could not exceed that amount. However, the right was also limited by the amount recovered by Pustilnik relative to this claim. In Pustilnik, Blue Cross was awarded subrogation to the full extent of its payment, not because the recovery by Pustilnik exceeded that paid by Blue Cross, or that they had first priority to the settlement proceeds, but because Pustilnik was deemed by the law of this Commonwealth to have recovered the full extent of his damages from SEPTA, including medical expenses, as a result of settling the claim against SEPTA. Hence, as presumably Pustilnik recovered in full, Blue Cross’ subrogation right rose to the full extent of its payment in Pustilnik’s behalf. This is illustrated in this court’s language: “when a subrogor settles, he waives his right to a judicial determination of his losses, and conclusively establishes the settlement amount as full compensation for his damages.” (emphasis added).

In the present case, there were two alleged tort-feasors. Clarke has already settled with one, yet there is an action pending against the City of Pittsburgh which may still go to trial. Consequently, unlike Pustilnik who, by settling, had “waived” his right to judicial determination of his damages, the settlement here does not have that effect. If the remaining action does go to trial, there still may be a judicial determination of the losses suffered. Only then, after collection efforts are made, will the parties be able to determine how much of Clarke’s claim for property damage to his vehicle has actually been realized (encompassing the proceeds of claims against both tort-feasors). If, for whatever reason, Clarke does not collect, in full, his claim for property damage, it would be improper for Allstate to receive the full extent of its payment to Clarke. To do so would be to place Allstate’s claim in damages proceeds above that of Clarke’s and would require the diversion of proceeds for other elements of Clarke’s damages to Allstate to the detriment of Clarke; this is contrary to the entire concept of subrogation. Appellee has not brought to the court’s attention any authority to support placing a superior priority on the insurer-subrogee’s interest as opposed to the subrogor’s, nor has the court’s own review found any, and this Court does not wish to create such a precedent with this case. Conversely, if the appellant here subsequently settles the action against the City of Pittsburgh, under Pustilnik, he will be conclusively establishing the extent of his damages at the total of both settlements and will then be estopped from claiming his loss exceeded that recovery.

Appellant also challenges the trial court’s refusal to set Allstate’s recovery in subrogation at an amount representing that paid Clarke minus reasonable attorney’s fees and costs. We are inclined to agree with Appellant that this constituted error. The trial court found appellant’s contention to be without merit because he had not raised the claim in his pleadings. However, as the subrogation action is equitable in nature the recovery must be limited by equitable principles. Our Supreme Court stated in Associated Hospital Service v. Pustilnik, 497 Pa. 221, 439 A.2d 1149 (1981), that the insurer in that case, Blue Cross, was “entitled to receive under the equitable doctrine of subrogation only what is actually paid on appellant’s behalf, less a reasonable attorney’s fee and a proportionate share of costs.” It would seem, therefore, that appellant was not obliged to plead attorney’s fees as a counterclaim or setoff to appellee’s claim for subrogation as equity would require that the insurer’s subrogation claim be limited to recovery reflecting the insurer subrogee’s proportionate share of the costs necessary to effectuate recovery, including attorney’s fees.

We are aware that appellee expressed a desire to appellant and his attorney not to have appellant’s attorney represent their subrogation interest. However, under these circumstances, we do not see how appellant could have protected himself and accomodated appellee, nor do we find that appellee was prejudiced by appellant’s actions. If appellee will not join in appellant’s recovery attempts or allow appellant’s attorney to represent appellee’s interest then appellee is effectively asking appellant to split the cause of action pursuing only damages for personal injury and thereby allowing appellee to proceed for damage to appellant’s automobile. However, such a cause of action could conceivably run afoul of our rules on joinder as well as the doctrine of res judicata. Furthermore, these concerns aside, this would appear feasible only where there existed no limitations on the ability to recover. However, where, as here, there exist effective limitations on recovery, the only way appellant could have realistically preserved the subrogation rights of appellee without itself recovering the maximum amount and holding the sum for appellee, which appellant did, would be to settle the personal injury aspect of the case at an amount less than the coverage provided. But, as indicated previously, the exact sum of appellee’s subrogation interest is not yet known. All that is known is that it may rise to its fullest level, in which case it would be worth the $4,007.00 claimed. We believe appellant has fully protected appellee’s subrogation interest by recovering the maximum liability coverage and holding the disputed amount in escrow.

As appellee reached no agreement with appellant and his attorney regarding fees, appellee will not be bound by a set formula of compensation or by appellant’s fee agreement with his attorney, but will, nevertheless, have its subrogation interest subject to the deduction of a reasonable fee. See, Associated Hospital Service v. Pustilnik, supra. This is in accord with equitable principles as well, since surely, had the insurer sought recovery in its own behalf, it too would have incurred similar costs. To allow the subrogee to recover without deduction for reasonable costs would be to place the subrogee in a better relative position than the subrogor; again this would run contrary to equitable principles. Nor do we place much weight on the fact that Allstate told appellant’s attorney not to represent their interest. As already noted, appellant’s attorney recovered for appellant the maximum liability coverage provided the alleged tort-feasor. In so doing, appellant’s attorney protected to the fullest extent the interests of both appellant and appellant’s insurer. Indeed, it appears to us that appellant’s attorney would have breached his duty to appellant had he intentionally settled the claim for a sum less than he could receive.

We do not think the insurer can create a practical conflict of interests by asserting a subrogation right to proceeds from an insured’s action for damages and then refusing to grant the insured’s attorney authority to represent the subrogation interest as well. Nor do we think that such refusal warrants excusal of the subrogee insurer’s equitable duty to share in a proportionate share of the costs in attaining such recovery. We realize that the insured’s settlement with the alleged tort-feasor, in circumstances like those here, destroys the insurer’s right to bring an action in its own right. However, we do not view that as a breach of the insured’s duty to protect the insurer’s subrogation interest when, as here, it appears the insured has maximized recovery against the alleged tort-feasor. We note further that, to the extent there existed a conflict in the rights of the insured and insurer it arose due to the insurer’s refusal to assent to appellant’s attorney’s joint representation of their respective interests. While we cannot compel the insurer to assent or acquiesce in appellant’s choice of representation or course of recovery, we do not feel we can condemn the insured subrogor for seeking maximum recovery from an alleged tort-feasor simply because his insurance carrier refuses to join in the recovery attempt.

For the reasons discussed above, we vacate the order granting summary judgment to appellee Allstate until such time as appellant’s suit against the City of Pittsburgh is resolved, at which time appellee’s subrogation interest can be determined.

Order vacated, jurisdiction relinquished.

ROWLEY, J., files a concurring and dissenting statement.

ROWLEY, Judge,

concurring and dissenting:

I join in the order vacating the summary judgment entered in favor of appellee, Allstate Insurance Company, and remanding this case to the trial court for further proceedings. I also join in the holding that summary judgment at this time is premature and that a final determination of the amount due the appellee must await the resolution of appellant’s claim against the city of Pittsburgh. Therefore, I join in Judge Brosky’s careful and persuasive analysis of this issue.

However, I find myself in disagreement with the majority’s disposition of the issue concerning counsel fees and expenses as discussed at pages 1026-1027 of their opinion. I agree that, if properly raised, the subrogee’s recovery should be reduced by an amount equal to a reasonable attorney’s fee for creation of the fund from which recovery is to be had. Appellant, however, did not, in his pleadings, raise any claim for such a reduction. The trial court held, therefore, that the issue was not properly before it. The majority, however, holds that “appellant was not obliged to plead attorney’s fees as a counterclaim or setoff____” I respectfully dissent from that holding and agree with the trial court’s conclusion.

Initially I note that, contrary to the statement of the majority, this is not an action in equity. Although equitable principles are to be considered in deciding the issue raised, the fact is that the proceedings and progress of this case through the trial court make it clear that it is a “civil action.” See Pa.R.C.P. 1001, as amended December 16, 1983. Thus the rules governing pleadings are those contained in Pa.R.C.P. 1001-1048. However, even should this be considered as an action in equity (which it is not), Pa.R.C.P. 1501 provides that actions in equity are governed by the procedural rules governing “civil actions” unless specifically otherwise provided in the equity rules. My review of the equity rules discloses no provision excusing the necessity to properly plead a setoff or counterclaim merely because equitable principles are involved. In fact, Rule 1510A provides that the defendant in an equity action may plead a legal counterclaim.

Under Pennsylvania’s fact-pleading procedure, each party to a lawsuit is entitled to be informed of the facts material to the original claim and defenses thereto. It is felt that such a system of pleading is necessary to enable the parties to properly prepare and present their case at the time of trial. Moreover, such a system of pleading is useful in narrowing the factual and legal issues to be resolved at trial. See II Goodrich-Amram 2d § 1017:1. Therefore, I would hold that appellant was obliged to plead the necessary facts giving rise to his claim to reasonable attorney’s fees and that his failure to do so precluded the trial court from deciding that issue. However, since I agree that the judgment must be vacated and the case remanded to the trial court, my decision on this issue would be without prejudice to the right of appellant to seek permission to file an appropriate amendment to his answer and new matter upon remand. Given my conclusion that the issue of attorney’s fees is not properly before us at this time, I do not join in the majority’s discussion thereof contained in its opinion, pages 1026-1027.

      . The same results would occur if the subrogee sued the third party in its own right.

      . This could be as a result of a determination of comparative negligence on the insured’s part or due to limitations on the ability to collect the judgment.

      . This is consistent with the concept of placing the subrogee in the precise position of the subrogor.

      . Hence, in effect, our law indicates that when an individual settles his suit he is later estopped from claiming that his damages exceeded the amount settled for. However, we feel compelled to express our concern over this position which we are equally compelled to apply. In our opinion the treatment of a settlement as conclusively establishing the value of the subrogor’s damage is neither supported in reason, sound policy or equity. There can be no doubt that many claims are settled for far less than the actual value of the damages sustained. This can be attributed to many factors. For example, the liability case may be weak for a number of reasons or there may be a readily ascertainable limit on the plaintiffs ability to collect on a judgment. This is often the case when liability coverage is limited and there exists little or no other assets to satisfy a judgment. Hence, as the Pustilnik court stated there may be many cases in which the subrogor “will be well advised to settle for substantially less than his claim.” However, the fact that the subrogor settles for less than the full value of his claimed damages does not magically reduce the value of the damages suffered to that sum, the loss remains just as great even though the innocent and often frustrated injured party may not have a reál opportunity to collect the full value of that loss. • By treating the settlement value as full compensation for the loss the courts are raising the relative value of the insurer’s subrogation interest and penalizing the injured insured. For instance, if the injured party’s damage equals $500,000 but because of liability policy limits he can only realistically collect $100,000 and settles out of court for this sum, the current rule of law will treat the $100,000 settlement as the full value of his damages even though it is given that this does not reflect the actual loss. By operation of this presumption the insurer will now be able to collect 100% of his payment to the injured insured from these proceeds further depleting the injured party’s already relatively small recovery of 20% of the value of his loss.
      While a full analysis of this presumption is beyond the scope of the issue presented in this appeal, suffice it to say that upon closer scrutiny, equity is not served by engaging in a legal myth which profits an insurer at the insured's expense and could encourage a plaintiff to litigate a matter which could otherwise be settled without great difficulty.

      . To illustrate this point further consider, for example, a situation where an injured insured receives a judgment in his favor for $500,-000 which encompasses pain and suffering, lost wages and earning capacity and medical bills. Assume further that the individual accumulated $100,000 in medical bills and that, because of effective limitations on recovery, only $100,000 is recovered from the tort feasor. Given the $100,000 recovery, logic and equity would require treating the insured as having recovered 20% of every dollar of damage suffered. Hence, the insured would have recovered only $20,000 of the $100,000 of medical bills incurred. There would be nothing equitable in awarding the entire $100,000 recovery to the medical insurer. To do so would require diversion of the insured’s recovery for his loss of earnings and pain and suffering and to completely deplete the insured’s recovery for damages. It would also allow the insurer to recover 100% of its expenditure while the insured only recovered 20% of his damages. Or stated alternatively, and to use an earlier analogy, if the subrogee stands in the precise position of the subrogor, the subrogor has only recovered 20% or $20,000 of his medical bills from the third party tortfeasor, consequently the subro-gee can receive no more than $20,000 from the subrogor.