source: Caselaw Access Project

author: WICKERSHAM, Judge:

license: Public Domain

text:
    479 A.2d 1005
    Richard A. HAEGELE, Administrator of the Estate of Linda C. Haegele v. PENNSYLVANIA GENERAL INSURANCE CO., Appellant.
    Superior Court of Pennsylvania.
    Argued Oct. 4, 1983.
    Filed June 22, 1984.
    Reargument Denied Sept. 4, 1984.

      Roger J. Harrington, Philadelphia, for appellant.
    Paul D. Keenan, Philadelphia, for appellee.

      Before WICKERSHAM, WIEAND and LIPEZ, JJ.
   WICKERSHAM, Judge:

This is an appeal from the judgment of the Court of Common Pleas of Philadelphia County, which resulted from an order denying appellant’s petition to vacate or modify the arbitrator’s award, and confirming the award of the arbitrators.

In July of 1978, Linda C. Haegele, age 16, died of injuries suffered while a passenger in an automobile owned by a Mr. Kaisinger. Linda’s estate (hereinafter “Estate”) received a payment of $15,000.00 under the liability provision of Kaisinger’s automobile insurance policy. The payment was the maximum amount allowed per person in a single accident under Kaisinger’s policy.

Because the Estate alleged damages exceeding $15,000.00, and because Linda was covered under her father’s insurance policy on two different vehicles, the Estate filed a claim with its insurer, Pennsylvania General Insurance Company (hereinafter “Insurer”), appellant herein. The Estate sought $60,000.00 in underinsured motorist benefits under the policy, pursuant to provisions containing $30,-000. 00.in underinsurance coverage for each of the two vehicles insured by the Haegele family. In essence, the Estate sought to cumulate or “stack” the coverage.

When the Insurer refused to make payment on the claim, the Estate petitioned the Court of Common Pleas of Philadelphia County to compel the Insurer to arbitrate the claim pursuant to an arbitration provision in the policy. On March 4, 1981, the court ordered that the claim proceed to arbitration. Thereupon, the matter proceeded to arbitration under the terms of the Pennsylvania Uniform Arbitration Act, 42 Pa.C.S. § 7301 et seq. After a hearing on the merits, the arbitrators unanimously found in favor of the Estate for $60,000.00 in underinsurance coverage.

On August 25, 1981, the Insurer filed a timely petition to vacate or modify the arbitrators’ award with the Court of Common Pleas of Philadelphia County. The Insurer’s position was that the policy terms limited the underinsurance coverage to $30,000.00 — the amount provided for one vehicle. The Estate responded by filing preliminary objections, which were treated by the lower court as an answer to the Insurer’s petition. After hearing oral argument, the Honorable Eugene Gelfand entered an order on January 14, 1982, denying the Insurer’s petition to vacate or modify, and confirming the arbitrators’ award.

The Insurer filed no exceptions to Judge Gelfand’s final order and on February 8, 1982, judgment was entered upon the order and award. The Insurer filed a timely notice of appeal from the lower court’s denial of its petition and from the entry of judgment on the arbitrators’ award. The Estate filed a motion to dismiss the appeal, citing the Insurer’s failure to file exceptions and preserve issues for appeal. On May 26, 1982, our court denied the motion to dismiss, but directed the parties to address this issue in their briefs.

Appellant Insurer raises the following questions:

I. Was the proceeding before Judge Gelfand a hearing on a petition and not a bench trial therefore not depriving this court of jurisdiction based on the failure to file exceptions?
II. Was the arbitrators’ award against the law of this Commonwealth and as such should it have been modified and/or vacated by the lower court?
III. Was the set-off clause contained within the underin-surance coverage endorsement valid, and if so, should it not have reduced the arbitrators’ award accordingly?

Brief for Appellant at 3. We must first address the waiver issue.

Appellee Estate argues that since no exceptions to the final order of the lower court (denying the Insurer’s petition to vacate or modify the arbitrators’ award and confirming that award) were filed, appellant Insurer has waived its right to object to the lower court’s order. The Estate characterizes this to be a situation governed by Pa.R.C.P. 1038(d). Pa.R.C.P. 1038 deals with trial without a jury and states in pertinent part:

(d) Within ten (10) days after notice of the filing of the decision, exceptions may be filed by any party to the decision or any part thereof, to rulings on objections to evidence or to any other matters occurring during the trial. Each exception shall set forth a separate objection precisely and without discussion. Matters not covered by exceptions are deemed waived unless, prior to final judgment, leave is granted to file exceptions raising these matters. No motion for a new trial, for judgment non obstante veredicto, in arrest of judgment or to remove a nonsuit may be filed.

The Estate bases its reasoning on 42 Pa.C.S. § 7320(b), a section of the Pennsylvania Uniform Arbitration Act, which states that an appeal from a court order under this act “shall be taken in the manner, within the time and to the same extent as an appeal from a final order of court in a civil action.” The manner applicable, according to the Estate, would be the assumpsit rules, and in particular, Pa.R.C.P. 1038(d).

The Insurer, on the other hand, argues that the proceeding before the trial court was a hearing on a petition and not a bench trial and therefore the failure to file exceptions does not deprive us of jurisdiction. As a hearing on a petition, the proceeding was not subject to Pa.R.C.P. 1038(d), which is directed toward the filing of exceptions to non-final orders after bench trials.

Judicial review of an arbitration award under the Uniform Arbitration Act as enacted in Pennsylvania, is obtainable (1) upon an application to the court to vacate the award, 42 Pa.C.S. § 7314, or (2) upon an application to the court to modify or correct the award, 42 Pa.C.S. § 7315. An application to vacate an award may be joined in the alternative with an application to modify or correct the award, as was done by the Insurer herein. 42 Pa.C.S. § 7315(c). 42 Pa.C.S. § 7316 states that upon the granting of a court order confirming, modifying, or correcting an award, a judgment or decree shall be entered in conformity with the order. Finally, 42 Pa.C.S. § 7317 states:

§ 7317. Form and service of applications to court
Except as otherwise prescribed by general rules, an application to the court under this subchapter shall be by petition and shall be heard in the manner and upon the notice provided or prescribed by law for the making and hearing of petitions in civil matters. Unless the parties otherwise agree, notice of an initial application for an order of court shall be served in the manner provided or prescribed by law for the service of a writ of summons in a civil action.

(emphasis added). It seems clear that under the above section, an application to the court under section 7314 or section 7315 shall be by petition and shall follow regular petition rules. The use of this type of procedure has been recognized and accepted by the courts. A party who seeks review of an arbitration award must petition the court of common pleas to vacate (or modify) the award. Reinhart v. State Automobile Insurance Association, 242 Pa.Super. 18, 363 A.2d 1138 (1976). The proper procedure to vacate an arbitrators’ award is by petition to the court of common pleas and not by a complaint in equity. Nationwide Mutual Insurance Co. v. Barbera, 443 Pa. 93, 277 A.2d 821 (1971); Great American Insurance Co. v. American Arbitration Association, 436 Pa. 370, 260 A.2d 769 (1970).

Since the proceeding below was a matter exclusively governed by the rules of petition practice, and hot an action in assumpsit subject to Pa.R.C.P. 1038(d), the Insurer was not required to file exceptions to the final order of the court. In Kennedy v. Frank L. Black, Jr., Inc., 271 Pa.Super. 454, 413 A.2d 1104 (1979), rev’d on other grounds 492 Pa. 397, 424 A.2d 1250 (1981), the court, in deciding whether to open a default judgment, discussed the difference between petition proceedings and assumpsit actions:

The critical distinction to be drawn is between petition proceedings, generally, and conventional cases tried by a jury or the court. Rule 1038 is applicable only to the latter, while the proceedings to open a default judgment are governed by the rules of the former. 7 Standard Pennsylvania Practice § 105. A hearing on a petition is not to be equated with a trial by the court sitting without a jury. Therefore, exceptions to the decision to open the judgment would not have been proper...

Id. 271 Pa.Super. at 459, 413 A.2d at 1107 (emphasis added). See also In Re Custody of Frank, 283 Pa.Super. 229, 423 A.2d 1229 (1980) (no exceptions required to grant of petition to confirm custody). We find that the filing of exceptions is not a condition precedent to an appeal from the denial of a petition to vacate or modify an arbitrators’ award or the confirmation of an arbitrators’ award under the Uniform Arbitration Act.

Moving on to the merits of the Insurer’s appeal, we must determine whether the arbitrators’ award was against the law of Pennsylvania so that it should have been modified and/or vacated by the court below. Following the order of the lower court granting the Estate’s petition to compel arbitration, a hearing was held and the arbitrators made an award in favor of the Estate in the amount of $60,000.00. It is this award that is contested.

Under 42 Pa.C.S. § 7302(d)(2), the lower court, in reviewing the arbitration award, should have modified or corrected the award if it was contrary to law and was such that had it been a jury verdict, the court would have entered a different judgment or a judgment n.o.v. This is the same standard of review recognized by the lower court in this case. Lower ct. op. at 4. Appellant Insurer argues that while the lower court recognized its proper scope of review, it failed to exercise its power under that scope, thereby committing reversible error.

Initially, we find no merit to the Insurer’s argument that the arbitrators had no authority to decide whether stacking applied in this case. We interpret the underinsured motorist arbitration provision in Mr. Haegele’s policy as requiring the arbitrators to determine whether a “covered” person is legally entitled to collect damages under the clause in question, and the amount of damages recoverable. This provision encompassed all the parties’ claims concerning the above issues, including the availability of stacking.

At the arbitration hearing and on this appeal, the Estate argues that (1) the Insurer failed to meet its burden of proof, as required under Pennsylvania law, regarding the affirmative defense of policy limitations and (2) the Estate was entitled to collect benefits under the coverage for each insured vehicle as a matter of law. The Arbitrators agreed with the Estate, as did the lower court. The Insurer primarily argues that (1) the Estate was not entitled to collect benefits for each insured vehicle as a matter of law, and (2) Hionis v. Northern Mutual Insurance Co., 230 Pa.Super. 511, 327 A.2d 363 (1974) is not applicable to this case.

The provisions of the underinsured motorist coverage in the insurance policy issued to Mr. Haegele by the Insurer set out the rights and obligations of the parties. On the second page of the underinsurance section, which consisted of a single sheet of paper with page one on the front and a continuation on the back, a section entitled “Limit of Liability” read as follows:

The limit of liability shown in the Schedule for this coverage is our maximum limit of liability for all damages resulting from any one accident.
This is the most we will pay regardless of the number of covered persons, claims made, vehicles or premiums shown in the declarations, or vehicles involved in the accident. However the limit of liability shall be reduced by all sums paid because of the bodily injury by or on behalf of persons or organizations who may be legally responsible. This includes all sums paid under the Liability Coverage of this policy____

(Record at 24) (emphasis added). The amount shown in the Schedule on the front page of the policy was actually zero or limitless, depending on one’s point of view, because it was left blank. On the declaration page under “coverage descriptions,” the amount shown for underinsurance was $30,000.00 for car 1 and $30,000.00 for car 2. (See R. 22-24, 87-89).

The Estate does not claim that the above clause, other than leaving the schedule amounts blank, is ambiguous. Rather, it claims that, regardless of whether the policy is clear or ambiguous, since the Insurer neither brought to Mr. Haegele’s attention nor explained to him any exclusions or limitations in the underinsured motorist coverage contained in the body of his policy, the Insurer failed to meet its burden of proof regarding its affirmative defense of limitations. In essence, the Estate attempts to bring this case within the Hionis line of decisions.

Unfortunately for the Estate, our supreme court has recently put an end to most Hionis-based arguments. In Standard Venetian Blind Co. v. American Empire Insurance Co., 503 Pa. 300, 469 A.2d 563 (1983), the court held that Hionis is not to be followed in cases where the limitation clause in an insurance contract is clear and unambiguous. The court went on to state:

Although on this record we reject Hionis, we note that in light of the manifest inequality of bargaining power between an insurance company and a purchaser of insurance, a court may on occasion be justified in deviating from the plain language of a contract of insurance. See 13 Pa.C.S. § 2302 (court may refuse to enforce contract or any clause of contract if court as a matter of law deems the contract or any clause of the contract to have been “unconscionable at the time it was made”). This record does not present such an occasion. We hold only that where, as here, the policy limitation relied upon by the insurer to deny coverage is clearly worded and conspicuously displayed, the insured may not avoid the consequences of that limitation by proof that he failed to read the limitation or that he did not understand it.

Id., 503 Pa. at 307, 469 A.2d at 567.

Since the Estate does not claim that the limitation clause was ambiguous or “unconscionable at the time it was made,” we hold that the Hionis line of decisions does not apply in the instant case.

However, we must also examine the law of Pennsylvania on the stacking of underinsurance benefits. It is here that the Estate’s argument must fall. Our court has recently held in Votedian v. General Accident Fire and Life Assurance Corp., 330 Pa.Super. 13, 478 A.2d 1324 (1984) that policy provisions identical to the one in the instant case, which prevent the stacking of underinsurance coverages and require a set-off for moneys paid by the tortfeasor, are valid and enforceable. Public policy is not violated by such provisions.

Therefore, we modify the award of the arbitrators to reflect the unambiguous agreement of the parties. The arbitrators award is reduced to $30,000.00, the amount provided for in the contract, and is further reduced to $15,000.00, to reflect the set-off provisions.

Judgment is modified as specified.

      . The Estate alleged that the damages incurred were in excess of $100,000.00.

      . There is no dispute regarding payment of premiums under the policy, or that the deceased was covered under said policy at the time of the accident.

      . The arbitration clause of the underinsured motorist coverage contained in the Haegele’s policy provides that unless otherwise agreed, "arbitration will take place in the county and state in which the covered person lives,” and that “local rules of law as to procedure and evidence will apply.” The parties agreed at the time of the arbitration hearing to follow the terms of the Pennsylvania Uniform Arbitration Act, 42 Pa.C.S. § 7301 et seq. rather than the Pennsylvania Arbitration Act of 1927, as specified in the policy itself.

      . The Superior Court noted that this same issue was, at that time, before the court en banc in the case of Jones v. State Automobile Insurance Assoc., 309 Pa.Super. 477, 455 A.2d 710 (1983). The decision in that case has since been filed at the above citation.

      . Appellee actually refers us to 42 Pa.C.S. § 7340(b) in their brief, but since there is no such section of the Act, we assume that this was a misprint.

      . We note that there is some confusion in the law concerning the correct procedure to use in situations such as this. The petition and rule (to vacate or modify the arbitrators’ award) appear to have been filed by the Insurer as original process. Brief for Appellant at 8. It appears from the record that jurisdiction may have been acquired by the lower court at an even earlier point, when the Estate filed a petition to compel arbitration. Generally, an action may be commenced by petition only when authorized by statute, because petition proceedings are considered auxiliary and are to be used to facilitate jurisdiction already acquired. See Goodrich-Amram 2d, § 1007:1, p. 464. The Insurer claims that the vacation or modification of statutory arbitration awards is one such instance where a petition may be used as original process. We agree.

      . Recent cases, by their absence of comment, have continued to accept and follow the rule that the proper procedure in attempting to vacate or modify or confirm an arbitrator’s award is by petition. For example, see, Hiller v. Allstate Insurance Co., 300 Pa.Super. 149, 446 A.2d 273 (1982); Obdyke v. Harleysville Mutual Insurance Co., 299 Pa.Super. 298, 445 A.2d 763 (1982); affirmed 500 Pa. 107, 454 A.2d 984 (1982).

      . However, we must consider what effect, if any, our recent decisions in Jones v. State Automobile Insurance Association, 309 Pa.Super. 477, 455 A.2d 710 (1983), and Floczak v. Nationwide Mutual Insurance Co., 289 Pa.Super. 438, 433 A.2d 885 (1981), have had on petition proceedings in no-fault insurance cases. In Floczak, our court held that a claim for basic work loss benefits under the Pennsylvania No-Fault Insurance Act may not be commenced by petition and rule. Rather, in accordance with Rule 1007, an action for no-fault benefits may only be commenced by filing a praecipe for a writ of summons, a complaint, or an agreement for an amicable action. Floczak distinguished between the commencement of an action and the filing of an application, or petition, after suit has been started. We note that Floczak found the wording in the act which permits proceeding upon "application” to be synonymous with "petition and rule.” Floczak, supra, 289 Pa.Superior Ct. at 442, 433 A.2d at 887. This is the same wording used in §§ 7314 and 7315 of the Pennsylvania Uniform Arbitration Act.

        Jones, supra, reiterated that an action under the No-Fault Act may be commenced only by the three methods listed in Pa.R.C.P. 1007. However, commencement of such an action by petition and rule is a waivable defect, since it is procedural. Id. 309 Pa.Super. at 481-482, 455 A.2d at 712. As in Jones, the Estate herein filed an answer to the insurer’s petition, and thus waived any objection to the manner in which the action was commenced. Jones went on to hold that the proper procedure to be followed in appealing cases wrongfully initiated by petition and rule is the same as that followed in the disposition of civil cases following a non-jury trial. Therefore, Pa.R.C.P. 1038(d) applies, which requires the filing of exceptions within ten days after notice of the filing of a decision. The failure to file such exceptions results in a failure to preserve issues for appellate review. Id., 309 Pa.Superior Ct. at 481-484, 455 A.2d at 712-713. The appellant’s failure to file exceptions before appealing in Jones was excused, however, by the following reasoning:
      In view of the considerable confusion that existed prior to the court’s decision in Floczak v. Nationwide Mutual Insurance Co., supra., about the proper procedure to be followed in these cases, appellant’s belief that the action could be begun by petition and rule had, at least, arguable merit. Additionally, no rule of court expressly requires the filing of exceptions to a final order dismissing a petition. In fact, a panel of this court had held that Rule 1038(d) did not apply to petition and rule proceedings. Kennedy v. Frank L. Black, Inc., 271 Pa.Super. 454, 413 A.2d 1104 (1979). Therefore, appellant’s right of review should not be barred by her failure to file exceptions.

        Id. 309 Pa.Super. at 483, 455 A.2d at 713.

        Jones declared its holding to be prospective only, in the sense that in any no-fault cases on appeal which were commenced by petition and rule without objection by the opposing side, and where a final order was entered by the trial court prior to Floczak, supra, the failure to file exceptions will be excused. Floczak was decided on July 24, 1981. The final order appealed from in the instant case was entered in January of 1982, six months after Floczak. See also Distler v. Pennsylvania Assigned Claims Plan, 318 Pa.Super. 487, 465 A.2d 658 (1983); Ralph v. Ohio Casualty Insurance Co., 320 Pa.Super. 262, 467 A.2d 29 (1983).
      Neither Floczak, Jones, nor Distler, which were all no-fault cases, involved statutory arbitration or the filing of underinsurance claims. These appear to be major distinguishing factors between those cases and the instant case. The Pennsylvania Uniform Arbitration Act expressly authorizes the use of a petition to vacate or modify an award of the arbitrators. 42 Pa.C.S. § 7314, § 7315, § 7317. Final judgment was entered on the court’s order denying the petition to vacate or modify and confirming the award of the arbitrators, pursuant to 42 Pa.C.S. § 7316. 42 Pa.C.S. § 7320(a)(3) and (a)(6) state that an appeal may be taken from a court order confirming an award and from a final judgment or decree of a court entered pursuant to the Uniform Arbitration Act. We find that the filing of exceptions is not a condition precedent to appealing the denial of a petition to vacate or modify an arbitrators awards, or the confirmation of an arbitrators' award, under the Uniform Arbitration Act.

      . Although the lower court ruled primarily on the Estate’s right to collect as a matter of law under each insured vehicle’s coverage, and did not reach the applicability of Hionis, it stated that: "However, it should be noted that nowhere in the record is there any indication that Mr. Haegele, as the policyholder, was aware of the exclusionary clause or of the effect of same upon him.” Lower ct. op. at 8, n. 10. Of course, the lower court reached its opinion before the decision in Standard Venetian Blind Co. v. American Empire Insurance, supra.


author: ROWLEY, Judge:

text:
    479 A.2d 1011
    The VALLEY FORGE HISTORICAL SOCIETY and The Valley Forge Historical Society on behalf of The Washington Memorial v. WASHINGTON MEMORIAL CHAPEL and The Rector, Church Wardens and Vestrymen of the Washington Memorial Chapel at Valley Forge, Pennsylvania, Appellants.
    Superior Court of Pennsylvania.
    Argued Sept. 6, 1983.
    Filed June 22, 1984.
    Petition for Allowance of Appeal Denied Oct. 15, 1984.

      John J. O’Brien, Jr., Philadelphia, for appellants.
    J. Aker, Norristown, for appellees.
    Before ROWLEY, POPOVICH and MONTGOMERY, JJ.
   ROWLEY, Judge:

This is a direct appeal from a final decree, entered on January 10, 1983, in a declaratory judgment proceeding, in the Orphans’ Court Division of the Montgomery County Court of Common Pleas granting a permanent injunction. The Chancellor declared that the appellants, the Rector, Church Wardens and Vestrymen of the Washington Memorial Chapel at Valley Forge, Pennsylvania, (“Chapel”) hold title to the real estate and buildings on the grounds of the Washington Memorial in trust for the joint occupancy and uses thereof of both the Chapel and the appellee, the Valley Forge Historical Society (“Society”). By virtue of the final decree a preliminary injunction, which had been entered against appellants on November 8, 1979 and continued on January 10, 1980, was made permanent. The appellants have been restrained from: 1) attempting to evict the Society from its quarters in the Washington Memorial, and 2) interfering with the Society’s free access to its quarters at the Memorial or the free access of the public to such quarters. After a thorough review of the record herein, we affirm the decree of the Chancellor, in part. Because of the unique circumstances in this case, however, we find that the decree must be modified, and thus, we remand for further proceedings not inconsistent with this opinion.

The pertinent facts underlying the dispute in this case are set forth in Valley Forge Historical Society v. Washington Memorial Chapel, 492 Pa. 491, 426 A.2d 1123 (1981), wherein the Supreme Court of Pennsylvania affirmed the grant of the preliminary injunction, and they need not be repeated here. The crucial inquiry on this appeal is whether the deeds, by which the Chapel acquired title to the property at Valley Forge, created a charitable trust, for both religious and patriotic purposes, for the benefit of both the Chapel and the Society.

The Chancellor heard testimony presented by the parties to this controversy for four days. He examined all of the deeds in the chain of title and a myriad of other documents, including writings of the Reverend W. Herbert Burk, the founder of both the Society and the Chapel. The Chancellor’s findings of fact may be summarized as follows. In 1905, I. Heston Todd and William M. Stephens executed separate deeds to three named individuals for the real property on which the Washington Memorial is now situated. By their deeds, the grantors intended to create, and did create, a trust under which the premises would be utilized for both religious and patriotic purposes. The Society at that time functioned as an unincorporated association originally known as the Valley Forge Museum of American History, with the first historical artifacts having been assembled in 1903. The Society became a non-profit corporation when its charter was granted in 1923. The Society fulfills the patriotic purposes of the trust, and the deeds, letters, and other evidence in this case confirm the fact that the trust was established, in part, for the benefit of the Society. Furthermore, over the years, the Society has expended large sums of money for capital improvements in the complex of buildings known as the Washington Memorial. The Chapel became a non-profit corporation when its charter was granted in 1910 and succeeded to the interests of the three individual grantees of the property. The Chapel, however, is not the beneficiary of the trust for patriotic purposes.

On the basis of these facts the Chancellor resolved the Society’s petition for declaratory judgment by determining that the Society was a beneficiary of the trust in perpetuity with the Chapel. Therefore he concluded that the Chapel holds the title to the real estate and buildings thereon in trust for the joint occupancy and uses of both the Chapel and the Society. Although the Chapel alleges eleven errors by the trial court, its basic contention on this appeal is that the Chancellor’s findings of fact and conclusions are not supported by the record and are based on a mistaken interpretation of the law.

Our scope of review on appeal of a final decree is well settled. The factual conclusions of the Chancellor have the force of a jury verdict and will not be disturbed on appeal unless they are not supported by adequate evidence. Cardamone v. University of Pittsburgh, 253 Pa.Super. 65, 384 A.2d 1228 (1978); Nationwide Mutual Insurance Co. v. Walter, 290 Pa.Super. 129, 434 A.2d 164 (1981). His findings are afforded particular weight in cases in which the credibility of witnesses must be evaluated, as the Chancellor has had the opportunity to hear their actual testimony and to observe their demeanor on the witness stand. See Fascione v. Fascione, 272 Pa.Super. 530, 416 A.2d 1023 (1979). We will not reverse on appeal unless the trial court abused its discretion or committed an error of law. Neshaminy Constructors v. Philadelphia et al., 303 Pa.Super. 420, 449 A.2d 1389 (1982). The same general principles apply to an appeal from the findings of a judge in Orphans’ Court proceedings. See Adoption of H., 476 Pa. 608, 383 A.2d 529 (1978). With these standards in mind, we review the evidence of record and the Chancellor’s findings and conclusions to determine whether the Chapel alleges any valid basis for reversal.

Initially, appellant argues that the evidence in this case did not establish the existence of an express trust for the benefit of the Society, and thus, the Orphans’ Court Division was without subject matter jurisdiction to entertain this action. In Valley Forge Historical Society v. Washington Memorial Chapel, 493 Pa. 491, 426 A.2d 1123 (1981), however, our Supreme Court specifically held that the Orphans’ Court Division had jurisdiction over this action under the Decedents, Estates and Fiduciaries Code, 20 Pa.C.S.A. § 711, as long as it was the grantor’s intent to create an inter vivos charitable trust. We find that the trial judge correctly determined that the relevant deeds and other evidence in this case demonstrated an intention on the part of the grantors to create a charitable trust for both religious and patriotic purposes. Thus, the Supreme Court’s opinion is dispositive on the issue of jurisdiction and we need not further address that issue here. See 493 Pa. at 497 n. 1, 426 A.2d at 1127 n. 1.

Appellant next contends that the trial judge did not follow the proper procedure in ruling on a petition filed by the Chapel to dissolve the preliminary injunction, resulting in a deprivation of the Chapel’s property without due process of law. Although the petition procedure was technically inaccurate, we find that it resulted in harmless error.

While the preliminary injunction was in effect, the Society ceased operations in the portion of the Chapel building that it occupied because the building did not comply with state and local building codes. On February 19, 1981, upon certification that the building code violations were remedied, the trial court permitted the Society to reopen the premises to the public. Thereafter, the Chapel petitioned to dissolve the preliminary injunction against it and sought to prohibit the Society from continuing its operations on the premises of the Washington Memorial. The Society filed an Answer 29 days after the petition was filed. Four days later, preliminary objections in the nature of a demurrer were filed by the Society. After a hearing on February 9, 1982, the trial judge sustained the demurrer.

We perceive no prejudice to the Chapel in the fact that the Society’s Answer was filed 9 days late, nor do we find that the trial court erred in refusing to dissolve the injunction. Although appellant’s petition was entitled “A Petition to Amend Court Orders” pursuant to Montgomery County Local Rule 251, it was actually a motion to dissolve the injunction. Under Equity Rule 1531(c), a party may move for dissolution of a preliminary injunction and present to the court any changes in circumstances that may have occurred since the issuance of the injunction which militate against its continuance. Goodrich-Amram 2d § 1531(c):1. The Society’s demurrer, albeit improper, was surplusage, since the Society was entitled to raise any objection at the hearing on the petition, and the trial court was free to permit any reasonable procedure designed to raise the objection. See, Goodrich-Amram 2d § 2018:1.

The Chapel was afforded an opportunity to present any facts that militated against continuance of the injunction at the February 9, 1982 hearing. The record reveals that it presented no evidence that justified dissolution or modification of the injunction. We find no prejudice to the Chapel in these proceedings. In allowing the Society to reopen its premises to the public upon certification that the building code violations were remedied, the trial judge properly sought to maintain the status quo — that is — “the last actual, peaceable and lawful noncontested status which preceded the pending controversy.” Valley Forge Historical Society v. Washington Memorial Chapel, 493 Pa. 491, 501, 426 A.2d 1123, 1129 (1981).

Appellant next argues that the Chancellor’s determination that the Society was an intended beneficiary of the trust is contrary to: 1) the Lay Control Property Act of 1855 and the Canons of the Protestant Episcopal Church; 2) the written lease agreement entered into by the Chapel and the Society; and 3) the language of the original deeds and the intent of Reverend Herbert Burk. We find that the opinion of the Chancellor, dated January 10, 1982, adequately disposes of appellant’s contentions regarding numbers (1) and (2) above. The Act of 1855 and the Canons provide only that property lawfully conveyed for the use of the Church alone cannot be diverted to other uses. The Chancellor determined that the use of the property involved herein for patriotic purposes is not prohibited by the Act or the Canons since the property was originally dedicated for both religious and patriotic uses. Regarding the written lease agreement between the parties, the Chancellor held that the nominal “landlord-tenant” relationship was a result of the parties’ attempts to resolve their disputes amicably in recent years. The Chancellor determined that the trial court was not bound by the parties’ characterization of their legal relationship and that the Society did not relinquish its legal and equitable rights by entering into a lease agreement of limited duration. We need add nothing further to the Chancellor’s resolution of these two issues. Therefore, we address herein only appellant’s basic contention that the language of the original deeds, and the intent of Reverend Burk, as established by the record, are inconsistent with a determination that the trust was established for the benefit of both the Chapel and the Society.

In his opinion, the trial judge succinctly outlined the trust provisions contained in the deeds, along with other documents relevant to their interpretation:

The parties agree that the first relevant deeds in the chain of title, and the pertinent language therefrom, are as follows:
1. The deed from I. Heston Todd to Rev. Herbert J. Cook, Sarah S. Zulick and Charles W. Comfort, dated April 3, 1905, transferring to the grantees title to a part of the subject premises (“the Todd Tract”)
“In trust nevertheless to hold and use the same for the public worship of Almighty God according to the faith and discipline of the said Protestant Episcopal Church in the United States of America and of the said Protestant Episcal (sic) Church in the Diocese of Penna. with authority to erect thereon suitable and necessary buildings for that purpose and for the use of those engaged and employed therein and thereabout and for patriotic purposes and upon the further trust as soon as a charter of incorporation is granted under the laws of Penna. and the constitution and canons of said church to the congregation worshipping therein to convey said land with the buildings and memorials thereon to the said corporation by whatever name it is incorporated and to its successors and assigns.” (emphasis supplied)
2. The deed from William M. Stephens and his wife to Rev. Herbert J. Cook, Sarah S. Zulick and Charles W. Comfort dated April 26, 1905, transferring to the grantees title to the remaining part of the subject premises (“the Stephens tract”)
“In trust nevertheless to hold and use the same for the purposes of the Washington Memorial Chapel of the Protestant Episcopal Church in the United States of America with authority to erect thereon suitable and necessary buildings for the purposes of the Congregation worshipping therein and for the use of those engaged and employed therein and thereabout and for patriotic purposes and upon the further trust as soon as a charter of incorporation is granted under the laws of Penns, and the constitution and canons of said Protestant Episcopal Church in the diocese of Penna. to the congregation worshipping therein to convey said land with the buildings and memorials thereon to the said corporation by whatever name it is incorporated and to its successors and assigns.” (emphasis supplied)

Petitioner [the Society] introduced into evidence a subsequent deed, dated March 27, 1915, (Exhibit P-12) conveying both the Todd tract and the Stephens tract from the Chapel to the Right Rev. Philip Mercer Rhinelander and the Right Rev. Thomas J. Garland and Charles Custis Harrison. This deed recits [sic] the following:

“Whereas certain gentlemen have agreed to assist Mr. Burk in the work and to contribute the sum of Fifty Thousand Dollars for the completion of the Main Chapel and Mr. Burk has procured promises of memorials which will probably cost another Fifty Thousand Dollars but said contributors have attached to their agreement the condition that a portion of said land be conveyed to the Trustees of the Diocese of Pennsylvania and that another portion thereof be held in Trust for the patriotic work originally included in the plans of the architect of said buildings, and have promised that upon the execution of such a declaration of trust, active efforts will be made by them in cooperation with Mr. Burk to raise the money for the erection of the said patriotic buildings and a building for the Museum of American History.”
“And whereas the congregation of the said Washington Memorial Chapel is unable to raise said funds without such cooperation----” (emphasis supplied)

This deed continued by authorizing the grantees “in trust to convey to the Trustees of the Protestant Episcopal Church of the Diocese of Pennsylvania, a corporation, so much of said land as to them shall seem proper ... for the use of the congregation” and then continued

“And upon the further Trust that the said Right Reverend Philip Mercer Rhinelander, Right Reverend Thomas J. Garland and Charles Custis Harrison L.L.D., and their successors in the trust, will hold the remaining part of said lands with such buildings as are now thereon or may hereafter be erected thereon ... In trust for such patriotic purposes as may be designated by them in a deed or declaration of trust to be formulated by them in which they shall designate their powers and the method of choosing their successors.” (emphasis supplied)'

This deed then set forth verbatim the resolution adopted at a special meeting of the Vestry held on January 2, 1915 unanimously authorizing the deed and specifically authorizing the above-quoted trust language of the deed.

It is noted that neither the grantees in this deed, nor any successor, executed a deed or declaration of trust in accordance with the last-quoted trust language of this deed. However, a letter dated May 1, 1944 from Dr. Hartshorne, Vice-President of the Church Foundation, stated the following:

“There was also a provision looking to The Church Foundation executing a Declaration of Trust. I doubt if that has ever been done, and it hardly seems worth while, as the trust is already described as being for Religious and patriotic purposes ____ The decree of merger covers all that; we just absorbed the old Trustees with all their rights and duties, so now (sic) transfers were unnecessary.”

And in an earlier letter, dated March 18, 1923, Bishop Garland one of the grantees in the 1915 deed, stated the following:

“... As I remember it, there was on the original plan of the Architect a patriotic building adjoining the Chapel, and when the property was conveyed to the Trustee it was with the stipulation that this property was for patriotic purposes. I agree with you that it is a great pity that there is such an accumulation of objects in the crowded buildings adjoining the Chapel and that it seriously detracts from the appearance but it is housed in the part that is held under the deed of trust for patriotic purposes I question whether we can legally object to it ...”

A trust is created if the relevant instruments of conveyance, taken as a whole, evidence an intent to impose upon the transferee of the property equitable duties to deal with the property for the benefit of another. Buchanon v. Brentwood Federal Savings and Loan Association, 457 Pa. 135, 143-144, 320 A.2d 117, 122 (1974). By the specific terms of the deeds to the “Todd Tract” dated April 3, 1905, and the “Stephen’s Tract” dated April 26, 1905, the title to the real property involved herein was conveyed in trust to be held for religious and patriotic purposes, both valid charitable uses. See RESTATEMENT (SECOND) OF TRUSTS §§ 371, 374 comment e; Decedents, Estates and Fiduciaries Code, 20 Pa.C.S.A. § 6101 et seq.; Valley Forge Historical Society v. Washington Memorial Chapel, 493 Pa. 491, 496, 426 A.2d 1123, 1126 (1981). We find that the Chancellor properly concluded that a charitable trust for religion and patriotism was created by the deed provisions cited above because they evidence an intention that the transferees hold the land subject to the equitable duty to use the land for those charitable purposes. Abel v. Girard Trust Co., 365 Pa. 34, 39, 73 A.2d 682, 684-685 (1950).

The terms of the trust for religious purposes stated that the property was to be used for the “public worship of Almighty God” according to the faith and discipline of the “Protestant Episcopal Church in the United States of America”, and that the property would be transferred in trust to the congregation of the church upon incorporation of the Washington Memorial Chapel according to the precepts of the Protestant Episcopal Church. The terms of the trust for patriotic purposes were not specifically set forth in the deed; however, the validity of the trust is not affected by the absence of specific direction by the grantors.

It is axiomatic that a gift is not rendered void because the grantor neglected to specify particular charitable objects. See In Re Jordan’s Estate, 329 Pa. 427, 197 A. 150 (1938) and cases cited therein. Where the intent to benefit a charitable use is clear, the gift will not be allowed to fail by reason of the object or the beneficiary being indefinite or uncertain as long as the intended beneficiary can be ascertained with reasonable certainty. In Re Black’s Estate, 398 Pa. 390, 158 A.2d 133 (1960). The overwhelming evidence in this case demonstrates that the Society was the intended beneficiary of the trust for patriotic purposes.

We note that at the time the property in question was conveyed, neither the Chapel or the Society was incorporated. Instead, both groups were in the early stages of organization, each being under the direction of Reverend W. Herbert Burk, the first Rector of the Chapel and the first President of the Society. As pointed out by the Chancellor, evidence of the intent of the original settlors was not available at the hearing in this case. It is obvious, however, that the provisions in the early deeds were to be carried out by the Reverend Burk, the founder of both the Society and the Chapel. It is clear that the operation of the Chapel and the Society was envisioned as a joint enterprise — a unique blend of religion and patriotism — to be established on the common grounds dedicated by Messrs. Todd and Stephens.

The language of the deed dated March 27, 1915, whereby the Todd and Stephens Tracts were transferred from the Chapel to three different individuals, in trust, conclusively demonstrates that the Valley Forge Museum of American History was to be located on the site of the Washington Memorial. In addition, the following language is significant:

And upon the further Trust that the said Right Reverend Philip Mercer Rhinelander, Right Reverend Thomas J. Garland and Charles Custis Harrison L.L.D., and their successors in the trust, will hold the remaining part of said lands with such buildings as are now thereon or may hereafter be erected thereon ... In trust for such patriotic purposes as may be designated by them in a deed or declaration of trust to be formulated by them in which they shall designate their powers and the method of choosing their successors.” (emphasis added)

It is apparent that the expected, subsequent designation in trust for patriotic purposes was never made by these three trustees, or their successors, because for sixty years, it was accepted that the Society fulfilled the patriotic purposes of the trust in a way that the Chapel could not. Nevertheless, the failure to make such a designation, does not now justify the Chapel’s attempts to frustrate the patriotic purposes of the trust by evicting the Society from its quarters in the Washington Memorial. It is well settled that where there is an intention to dedicate property in trust for a charitable use, the trust will not lapse for failure of a trustee to act. Abel v. Girard Trust Co., 365 Pa. 34, 73 A.2d 682 (1950); RESTATEMENT (SECOND) OF TRUSTS § 397 (1959). The Decedents Estates and Fiduciaries Code, 20 Pa.C.S.A. § 6110 provides in pertinent part:

(a) General rule. — Except as otherwise provided by the conveyor, if the charitable purpose for which an interest shall be conveyed shall be or become indefinite or impossible or impractical of fullfilment, or if it shall not have been carried out for want of a trustee or because of the failure of a trustee to designate such purpose, the court may, on application of the trustee or of any interested person or of the Attorney General, after proof of notice to the Attorney General when he is not the petitioner, order an administration or distribution of the estate for a charitable purpose in a manner as nearly as possible to fulfill the intention of the conveyor, whether his charitable intent be general or specific.

In this case, according to the terms of the relevant deeds, a portion of the property in question was to be held for patriotic purposes, including the establishment of a Museum of American History. The patriotic activities contemplated will not now be permitted to cease merely because the exact terms of the trust for patriotic purposes were not specified. Our review of the history of this case convinces us that the Society was the intended beneficiary of the trust for patriotic purposes and thus, it has the right to remain in its quarters at the Washington Memorial.

The Chapel now argues that the existence and operation of the Chapel alone upon the original site is sufficient to fulfill the patriotic purposes of the trust. This argument is without merit. The original deed provisions contemplate more than just the operation of a Chapel on the real property involved herein, and the Chapel’s actions indicate a failure to recognize the importance of the patriotic aspects of the Washington Memorial. Indeed, not only have they attempted to oust the Society, but they have expressed the desire to tear down the building that now houses the Society’s operations. The present hostility between the Chapel and the Society cannot alter the trust terms; it does not change the fact that the Washington Memorial was established for the inculcation of both religion and patriotism.

In the past ten years, the Chapel, as successor trustee, has failed to act in a manner that is consistent with the original trust provisions. The working relationship between the parties has obviously deteriorated and we do not perceive that the Chapel, acting as trustee, will be able to fairly determine the respective duties and responsibilities of the parties as joint occupants of the Washington Memorial without some impartial supervision. However, the Chancellor’s decree does not provide the necessary detailed guidance to enable the Chapel to execute the trust for the benefit of both the Chapel and the Society with a minimum of discord and disagreement. See Abel v. Girard Trust Co., 365 Pa. 34, 73 A.2d 682 (1950); RESTATEMENT (SECOND) OF TRUSTS §§ 388, 392 and 397 (1959). Consequently, we remand this case for a modification of the final decree, to include provisions outlining the respective responsibilities and duties of the parties regarding the expenses, operation and general upkeep of the Washington Memorial. The trial court, in its supervisory capacity, will see that such obligations are fairly allocated between the parties so that the intentions of the original grantors and their successors may be properly carried out.

Decree affirmed in part, modified in part, and remanded for further proceedings not inconsistent with this opinion.

Jurisdiction is relinquished.

      . The Chancellor certified that his decree was sufficient to determine "the substantial issues” between the parties, and thus, his decree was entered as a Final Decree, rather than a decree nisi according to Pennsylvania Rules of Civil Procedure 1517 and 1520. Appellant specifically waived any error in this procedure. We, however, express no opinion regarding the propriety of such a procedure.

      . The “Washington Memorial” is the term used to designate the parcel of land and the group of attached buildings erected thereon, located at the edge of the Valley Forge Historical National Park. The “Washington Memorial” is intended as a memorial to our Nation’s first president and those men and women of the Revolutionary Army who were quartered with him at Valley Forge during the winter of 1777-1778. The Memorial is said to be near the spot where historians say General Washington knelt in the snow to ask God’s help during that terrible winter.

      . Although the Chapel was entitled to take an interlocutory appeal from the trial court’s determination, Pa.R.A.P. 311(a)(4), the failure to appeal immediately did not constitute a waiver of the Chapel’s objections on this appeal, taken from the final determination on the merits, Pa.R.A.P. 311(d)(1)(i).

      . The Chapel argues that the filing of an answer to the petition resulted in a waiver of the right to file preliminary objections in the nature of a demurrer under Pa.R.C.P. 1032. Although a petition is not a pleading under Pa.R.C.P. 1017, pleading rules have been applied to petition and answer proceedings. See Monroe Contract Corp. v. Harrison Square, Inc., 266 Pa.Super. 549, 405 A.2d 954 (1979). Generally, an answer is the proper reply to a petition. Under Rule 1032, the filing of an answer constitutes a waiver of certain defenses, but it does not constitute a waiver of the right to demur, since that defense is included in the exceptions to Rule 1032 and may be raised at any time in the action. Goodrich-Amram 2d §§ 1017(b):3, 1032:5. However, the proper procedure for demurring after the answer has been filed is by a motion for judgment on the pleadings. Pa.R.C.P. 1034. Thus, under general pleading rules, the Society’s demurrer by preliminary objection may have been improper; however, because this controversy was before the court on a petition, the court had the discretion to resolve the dispute on its merits.

      . Appellant also alleged that the Statute of Frauds precluded the introduction of extrinsic evidence to alter the terms of the express trust. We have reviewed appellant’s claim, and in light of our disposition of this case and interpretation of the relevant deed provisions, we find it to be without merit.


author: HESTER, Judge:

text:
    479 A.2d 1021
    Dolores BIGLAN, Executrix of the Estate of Albert M. Biglan v. Henry M. BIGLAN and Northeastern National Bank and Trust Company. Appeal of Henry M. BIGLAN. Dolores BIGLAN, Executrix of the Estate of Albert M. Biglan, Appellant v. Henry M. BIGLAN and Northeastern National Bank and Trust Company.
    Superior Court of Pennsylvania.
    Submitted April 16, 1984.
    Filed June 22, 1984.

      Robert J. Borthwick, Scranton, for appellant (at No. 2889) and for appellee (at No. 2897).
    John R. O’Brien, Scranton, for appellant (at No. 2897) and for appellee (at No. 2889).
    Before MONTEMURO, CERCONE and HESTER, JJ.
   HESTER, Judge:

This case in equity involves an appeal and a cross-appeal, both parties assigning error to the determination of the court below dismissing the action. For the reasons that follow, we reverse and remand for trial.

Appellee-cross-appellant (hereinafter appellee) Dolores Biglan, Executrix of the Estate of Albert Biglan, deceased, filed this action on March 30, 1965, seeking to enforce an alleged assignment of certain stocks by appellant-cross-appellee (hereinafter appellant) to his brother, Albert M. Biglan. Appellant filed a counterclaim for damages due to his inability to sell or otherwise transfer the stock since the institution of the suit, and for the return of certain shares of stock which he had transferred to Albert.

On the day of trial, September 10, 1981, appellant filed a motion to dismiss appellee’s action for failure to comply with 20 Pa.C.S.A. § 4101(2). The chancellor granted appellant’s motion, holding that appellee, by failing to provide an affidavit required by the above statute, lacked capacity to sue as a foreign fiduciary. Appellee’s oral motion to amend her complaint to comply with § 4101(2) was denied as untimely. However, appellee’s motion to dismiss appellant’s counterclaim was granted. From these dismissals, the parties have appealed.

The first issue we will address is whether the lower court erred in dismissing appellee’s complaint. Albert Biglan died a resident of New York; as executrix of his estate, appellee is a foreign fiduciary for purposes of filing an action in the Commonwealth. A foreign fiduciary may institute legal proceedings in the Commonwealth subject to the conditions and limitations imposed by 20 Pa.C.S.A. § 4101. That statute requires the foreign fiduciary to provide the following documents:

(1) Copy of appointment. The foreign fiduciary shall file with the register of the county where the power is to be exercised, or the proceeding is instituted, or the property concerning which the power is to be exercised is located, an exemplified copy of his appointment or other qualification in the foreign jurisdiction, together with an exemplified copy of the will or other instrument, if any, in pursuance of which he has been appointed or qualified....
(2) Affidavit. The foreign fiduciary shall execute and file an affidavit with the register of the county where the power is to be exercised or the proceeding is instituted or the property concerning which the power is to be exercised is located, stating that after diligent search and inquiry, the estate of which he is fiduciary is not, to his knowledge or so far as he has been able to discover, indebted to any person in the Commonwealth, and that he will not exercise any power which he would not be permitted to exercise in the jurisdiction of his appointment. The affidavit shall be attached to the copy of appointment.

20 Pa.C.S.A. § 4101. Appellee failed to file the above-mentioned documents prior to the institution of the within litigation. However, on the day of trial, exemplified copies of her appointment and the will had been duly filed. The only requirement which remained unfulfilled was the filing of an affidavit stating that the estate was not indebted to anyone in the Commonwealth. Appellee moved to amend her complaint by filing such an affidavit; however, appellant objected, contending that an action which he instituted in New York against the estate constituted a debt of the estate. Appellant therefore, asserted that appellee could not lawfully execute an affidavit averring that the estate owed no debts to any person in the Commonwealth.

The lower court refused to permit appellee to amend her complaint. In his opinion, the chancellor considered “the amount of delay as well as the existence of a filed claim against the estate” in denying appellee’s application to belatedly file the required affidavit. Although the court cited both reasons as the bases for its decision, it emphasized appellee’s failure to file the appropriate documents necessary to institute this lawsuit throughout the extended period of time that this case has been in progress.

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 this Court 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 were committed, the decision of the chancellor must be reversed. Dudash v. Dudash, 313 Pa.Super. 547, 460 A.2d 323 (1983).

The determination by the chancellor that the action filed against the estate constituted a debt and that the lack of compliance with § 4101 deprived appellee of capacity to sue are conclusions of law and, as such, are fully reviewable by this Court.

Initially, we agree with the interpretation of § 4101 by the court below that a debt by the estate to a citizen of this Commonwealth forecloses the availability of our judicial system as a forum in which to sue. We must agree with appellee, however, in her contention that an unadjudicated claim against the estate does not constitute a debt for the purposes of this statute. Section § 4101(2) requires the foreign fiduciary to file an affidavit authorizing his or her investigation, search, and conclusion that the estate owes no debts within the Commonwealth. The purpose of this statute is to prevent the fiduciary from instituting any proceedings or exercising any powers pursuant to administration of the estate when creditors of the estate are citizens of this Commonwealth. The most common reason for instituting proceedings is for the sale or distribution of assets. By requiring the above affidavit, the legislation protects the interests of local creditors of the estate and obviates the need to pursue their interests in a foreign jurisdiction when a res exists in the Commonwealth.

This aim is not served by permitting an unliquidated claim to obstruct the execution of the fiduciary’s responsibilities to the estate. “Debt” is defined by Black’s Law Dictionary as “a sum of money due by certain and express agreement; as by bond for a determinate sum, a bill or note, a special bargain, or a rent reserved on a lease, where the amount is fixed and specific, and does not depend upon any subsequent valuation to settle it.” BLACK’S LAW DICTIONARY 490 (rev. 4th ed. 1969). By equating a cause of action with a certain debt, the lower court has, in effect, ruled that any proceedings instituted by the fiduciary could be blocked by the mere filing of a claim against the estate. Just that has occurred herein, where the debtor of the estate has achieved a dismissal of the action against him by simply filing an action against the estate. Surely, such was not the intent of the legislature when it bestowed upon foreign fiduciaries the rights and powers of a local fiduciary, albeit subject to the limitations of a foreign suitor.

We therefore hold that until a debt has been judicially established, whether through a lawsuit or an audit pursuant to the grant of ancillary administration, an asserted but unliquidated obligation does not constitute an indebtedness for the purpose of § 4101(2). See In re Parkhurst Estate, 14 D & C 2d 661 (1957). See also Hollidaysburg Borough v. Snyder, Executor, 258 Pa. 490, 102 A. 168 (1917). Consequently, the existence of an unliquidated claim against the estate would not prevent the executrix from filing the requisite affidavit.

As to the timeliness of the filings of the copy of appointment, the exemplified will, and the affidavit of non-indebtedness, we must once again differ with the conclusion of the chancellor. For the following reasons, we find that appellee’s action is not barred by her procedural errors.

First, the statute itself is silent as to any time limitations. The legislature imposed no requirements as to when the necessary documents were to be filed or the effect upon the action if the documents were not filed. If anything, the language appears to indicate that the documents could be filed after the proceeding was underway: “The foreign fiduciary shall execute and file an affidavit with the register of the county where the power is to be exercised or the proceeding is instituted____” 20 Pa.C.S.A. § 4101(2) (emphasis added). In the face of this ambiguous language, we cannot interpret § 4101 to comprise a condition precedent to the institution of a legal proceeding.

Second, it is beyond peradventure that leave to amend pleadings has traditionally been liberally granted in this jurisdiction. Dietrich Industries, Inc. v. Abrams, 309 Pa.Super. 202, 455 A.2d 119 (1982); Sullivan v. Allegheny Ford Truck Sales, Inc., 283 Pa.Super. 351, 423 A.2d 1292 (1980). Pa.R.C.P. 1033 provides “[a] party, either by filed consent of the adverse party or by leave of court, may at any time change the form of action, correct the name of a party or amend his pleading.” As can be seen from the clear language of this rule, no limit is imposed on the time when an amendment may be made. Pleadings may be amended at the discretion of the trial court after pleadings are closed, while a motion for judgment on the pleadings is pending, at trial, after judgment, or after an award has been made and an appeal taken therefrom. Sheppard v. First Pennsylvania Banking & Trust Co., 199 Pa.Super. 190, 184 A.2d 309 (1962). The fundamental purpose of this rule is to prevent cases from turning on purely technical defects. Keller v. Keller Motor Co., 386 Pa. 56, 124 A.2d 105 (1956); Solomon v. Luria, 213 Pa.Super. 87, 246 A.2d 435 (1968). As our Supreme Court once observed, “hyper-technicality and formalism in pleading [are] contrary to the modern practice of allowing free amendment in order to promote resolution of cases on their merits.” Wm. Penn Parkway Garage, Inc. v. City of Pittsburgh, 464 Pa. 168, 187, 346 A.2d 269, 278 (1975).

That is not to say that the right to amend pleadings is to be granted as a matter of course. Although the accepted practice favors permitting amendments, the right to amend is subject to the discretion of the trial court and is properly denied if there is resulting prejudice to the adverse party. Mancine v. Concord-Liberty Savings & Loan Ass’n., 299 Pa.Super. 260, 445 A.2d 744 (1982); Sands v. Forrest, 290 Pa.Super. 48, 434 A.2d 122 (1981).

However, appellant alleged no prejudice at trial when appellee moved to amend her complaint, or in this appeal. He was fully apprised of the action against him and the amendment in question would not have resulted in the assertion of new claims against him for which he was unprepared. The record discloses no prejudice that would justify the court’s denial of appellee’s proposed amendment.

Finally, our conclusion finds support in two federal cases on point. Although § 4101 has not been interpreted by this Court heretofore, the United States District Court for the Western District of Pennsylvania was recently confronted with a factually similar case. Therein, an administratrix from West Virginia filed a survival cause of action in that court without complying with the conditions of § 4101. The defendants contended that the administratrix lacked capacity to sue, particularly since the statute of limitations on the cause of action had since expired. The District Court duly considered the general philosophy of pleading, the need to provide fair notice of the general fact situation out of which the claim arose, and the preference that the decision of a case turn on the merits and not on the technical niceties of pleading. Finding no prejudice inuring to the defendants from plaintiffs failure to comply with § 4101 prior to institution of the suit, the motion to dismiss was denied and amendment was allowed. Hunt v. Penn Central Transportation Co., 414 F.Supp. 1157 (W.D.Pa.1976). The other federal case applying this statute reached a similar result. See Greene v. Goodyear, et al., 112 F.Supp. 27 (M.D.Pa.1953). The reasoning of the District Court confirms our view of § 4101 and sustains our analysis hereinbefore stated.

We are forced to conclude, therefore, that the denial of appellee’s motion to amend her complaint was an abuse of discretion, and the chancellor’s determination that the filed claim against the estate constituted a debt was an error of law. Where, as here, the refusal to allow the amendment resulted in putting appellee out of court, the chancellor’s decision must be reversed. We hereby reinstate appellee’s complaint and remand for trial.

In so doing, we also reinstate appellant’s counterclaim, which was dismissed by the chancellor when he dismissed appellee’s complaint. The chancellor ruled that the court lacked jurisdiction to hear the counterclaim once the original claim was dismissed. However, having reinstated the complaint, the lower court may now likewise entertain the counterclaim.

Reversed and remanded for proceedings not inconsistent with the above opinion. Jurisdiction is hereby relinquished.

MONTEMURO, J., concurs in the result.

      . See also Pa.R.C.P. 126:
      The rules shall be liberally construed to secure the just, speedy and inexpensive determination of every action or proceeding to which they are applicable. The court at every stage of any such action or proceeding may disregard any error or defect of procedure which does not affect the substantial rights of the party.


author: WIEAND, Judge:

text:
    479 A.2d 1027
    ROBERT WOOLER COMPANY v. The FIDELITY BANK, Wayne Raichle and Donna E. Raichle and Touche Ross & Co. Appeal of The FIDELITY BANK.
    Superior Court of Pennsylvania.
    Argued May 7, 1984.
    Filed June 29, 1984.
    Reargument Denied Sept. 4, 1984.

      Michael G. Trachtman, Norristown, for appellant.
    Steven T. Stern, Philadelphia, for Wooler, appellee.
    Michael L. Temin, Philadelphia, for Touche, appellee.
    Before WIEAND, MONTEMURO and HOFFMAN, JJ.
   WIEAND, Judge:

This appeal requires that we review the nature and extent of the duty owed by an accounting firm to the company which retained it to perform unaudited services. It also requires that we review the circumstances under which interest may be added to a tort verdict based on negligence.

Robert Wooler Company (Wooler), a corporation, filed suit against The Fidelity Bank (the Bank) to recover a loss sustained when Wooler’s bookkeeper, Donna Raichle, diverted 94 Wooler checks into a personal account maintained by Raichle and her husband at the Bank. The complaint alleged that the Bank had accepted checks for deposit which contained forged corporate endorsements and, therefore, was liable for conversion under 13 Pa.C.S. § 3419. The complaint also contained averments that the Bank had failed to exercise reasonable care and had failed to handle the forged instruments in accordance with reasonable commercial standards. The Bank joined Raichle as an additional defendant. It also joined Touche Ross & Co. (Touche Ross), the accounting firm employed by Wooler, alleging that the accountant had enabled the Wooler loss to go undetected by negligently performing accounting services which it had been contractually obligated to perform. Touche Ross filed preliminary objections alleging improper joinder. These objections were dismissed, and, after extensive discovery, the case came on for trial without jury.

Following trial, the court made findings of fact. It found that the Bank had converted the checks and had been guilty of negligence when it accepted cheeks payable to the corporation and credited the proceeds to Raichle’s personal account. The court found that Wooler had also been negligent but that its contributory negligence had not been a substantial factor in bringing about its loss. On appeal, the Bank has not challenged the court’s findings regarding its liability. It does challenge the manner in which the court disposed of the negligence of Touche Ross. With respect to the accountant’s liability, the trial court made the following findings.

24. Additional defendant Touche Ross and Co. is not liable for contribution to Fidelity or jointly liable or solely liable to Robert Wooler Company.
25. Additional Defendant Touce [sic] Ross and Co. is not liable as stated above on the theories set forth in Judge Takiff’s Opinion. Yardis v. First Pa. Bank N.A. and David H.L. Aron & Cogan, Sklar and Company, [20 D. & C.3d 679 (1980) ].
26. Additional Defendant is not liable in accordance with current legal theories as set forth above even though it failed to use reasonable care in being alert, and therefore, failed to make the necessary inquiries in accordance with reasonable professional standards so as to discover what was readily discoverable to it in order to protect plaintiff.
27. Professionals such as Touche Ross & Co. cannot be like the three monkeys ‘hear no evil, see no evil, speak no evil’ in order to avoid liability to the plaintiff if liability were otherwise attachable, (emphasis added).

Judge Takiff’s decision in Yardis v. First Pa. Bank, et al., supra, upon which the trial court relied, had been decided on procedural grounds. It had there been held that in an action by a payee against a bank to recover losses sustained when the bank accepted forged checks for deposit, the payee’s accountant could not be joined as an additional defendant. In the instant case, however, another judge of the Montgomery County Court of Common Pleas held prior to trial that the joinder of Touche Ross as an additional defendant had been proper and denied a preliminary objection asking that such joinder be stricken. Trial was thereafter completed with Touche Ross, the additional defendant, as a party and active participant.

Exceptions filed by the Bank to the court’s adjudication were dismissed by a court en banc without opinion. After the Bank had appealed, the trial judge prepared a “Supplemental Opinion” in which he confirmed the prior basis for his refusal to impose liability upon Touche Ross but added his further conclusion that Touche Ross “had no duty to inquire into plaintiff’s system of internal control.”

The evidence adduced at trial discloses that accounting services may be audited or unaudited, depending upon the terms of the agreement between the accountant and the client. The principal difference between the two is the degree and amount of responsibility undertaken by the accountant. In both types of engagements the accountant agrees to prepare financial statements. In an audited engagement, the accountant assumes responsibility for the accuracy of the figures appearing thereon. In effect, he warrants the reliability of the report which he prepares. In an unaudited engagement, the accountant does not warrant and is not responsible for the ultimate accuracy of the report if the figures supplied by the client are erroneous.

Touche Ross was employed by Wooler in an unaudited engagement. The accounting firm contends that in such an engagement, an accountant has no duty to discern defects in the client’s system of internal controls. This is the first issue we must resolve. Does an accountant so engaged have a duty to examine the means or procedures set up by the client to protect the assets of the business entity? If the accountant knows or has reason to know that the client’s system of internal control contains defects which impair the client’s financial security, what is the accountant’s responsibility to correct them or call them to the attention of the client?

In O’Neill v. Atlas Automobile Finance Corp., 139 Pa. Super. 346, 11 A.2d 782 (1940), this Court recognized that the specific scope of an accountant’s duty to a client must be determined primarily by the terms and conditions of the contract of employment. There, an accounting firm had sued Atlas to recover sums allegedly due for unaudited accounting services. Atlas counterclaimed for losses sustained because of the accounting firm’s alleged negligence in failing to discover that funds of the client were being embezzled by an employee. This Court upheld a verdict in favor of Atlas, holding that the contract of employment did not impose upon the accountants a duty to investigate and certify the regularity of the information supplied by Atlas’ employees. In so doing, however, the Court approved a jury instruction regarding the accountants’ duty of care as follows: “They [the accountants] agreed to use such skill in the performance of their agreement as reasonably prudent, skillful accountants would use under the circumstances.” Id., 139 Pa.Superior Ct. at 354-355, 11 A.2d at 786 (emphasis added).

The standard of care required of persons who render professional services has been stated in the Restatement (Second) of Torts § 299A as follows:

Unless he represents that he has greater or less skill or knowledge, one who undertakes to render services in the practice of a profession or trade is required to exercise the skill and knowledge normally possessed by members of that profession or trade in good standing in similar communities.

This standard has been followed uniformly by the courts of this Commonwealth in determining claims predicated upon alleged negligence on the part of other professional persons. See: Incollingo v. Ewing, 444 Pa. 263, 282 A.2d 206 (1971) (the standard of skill and knowledge required of a physician is that possessed and employed by physicians generally in the same or a similar locality); Bloomsburg Mills, Inc. v. Sordoni Construction Co., 401 Pa. 358, 164 A.2d 201 (1960) (client of architect has a right to expect architect to use “reasonable and ordinary care and diligence in the application of his professional knowledge to accomplish the purpose for which he is retained”); Hoyer v. Frazee, 323 Pa.Super. 421, 426, 470 A.2d 990, 993 (1984) (attorney has a duty to exercise “ordinary skill and knowledge”).

Other jurisdictions, as well as most commentators, have adopted for accountants a standard of care similar in all respects to the standard set forth in section 299A of the Restatement. See: Gantt v. Boone, Wellford, Clark, Langschmidt and Pemberton, 559 F.Supp. 1219, 1227 (M.D.La.1983) (applying Louisiana law); Vernon J. Rockier & Co. v. Glickman, Isenberg, Lurie & Co., 273 N.W.2d 647, 650 (Minn.1978), citing Gammel v. Ernst & Ernst, 245 Minn. 249, 253, 72 N.W.2d 364, 367 (1955); Stanley L. Bloch, Inc. v. Klein, 45 Misc.2d 1054, 1056, 258 N.Y.S.2d 501, 505-506 (1965); Richard v. Staehle, 70 Ohio App.2d 93, 97, 434 N.E.2d 1379, 1384 (1980); Kemmerlin v. Wingate, 274 S.C. 62, 64, 261 S.E.2d 50, 51 (1979); Delmar Vineyard v. Timmons, C.P.A., 486 S.W.2d 914, 920 (Tenn.Ct.App.1972); Atkins v. Crosland, 406 S.W.2d 263, 264 (Tex.Civ.App.1966), rev’d on other grounds, 417 S.W.2d 150 (Tex.1967); Prosser, Law of Torts § 32, 161-163 (4th ed. 1971); Accountants’ Liability for Negligence — A Contemporary Approach for a Modern Profession, 48 Fordham L.Rev. 401-421 (1979); Anno., Accountant’s Malpractice Liability to Client, 92 A.L.R.3d 396 (1979).

The existence of a duty, it has been said, is a matter of foreseeability. Thus, in Migyanko v. Thistlethwaite, 275 Pa.Super. 500, 419 A.2d 12 (1980), this Court said:

In determining the existence of a duty of care, the time honored test formulated by Judge Cardozo is that “[t]he risk reasonably to be perceived defines the duty to be obeyed____” Palsgraf v. Long Island Railroad Co., 248 N.Y. 339, 344, 162 N.E. 99, 100 (1928). See, e.g., Zilka v. Sanctis Construction, Inc., 409 Pa. 396, 186 A.2d 897 (1962), cert. denied, 374 U.S. 850, 83 S.Ct. 1915, 10 L.Ed.2d 1070 (1963); Hoover v. Sackett, 221 Pa.Super. 447, 292 A.2d 461 (1972). Only when the question of foreseeability is undeniably clear may a court rule as a matter of law that a particular defendant did not have a duty to a particular plaintiff. Metts v. Griglak, 438 Pa. 392, 264 A.2d 684 (1970); Palsgraf v. Long Island Railroad Co., supra.

Id., 275 Pa.Superior Ct. at 505, 419 A.2d at 14 (emphasis added).

Touche Ross’ agreement to perform unaudited services was not a shield from liability if it failed to warn its client of known deficiencies in the client’s internal operating procedures which enhanced opportunities for employee defalcations. Its agreement, in the absence of specific language relieving it from acts of negligence, did not relieve it from liability for ignoring suspicious circumstances which would have raised a “red flag” for a reasonably skilled and knowledgeable accountant. Thus, in 1136 Tenants’ Corp. v. Max Rothenberg & Co., 36 A.D.2d 804, 805, 319 N.Y.S.2d 1007, 1007-1008 (1971), aff’d, 30 N.Y.2d 585, 281 N.E.2d 846, 330 N.Y.S.2d 800 (1972) a New York court held that it was negligence for an accountant engaged to perform unaudited services to ignore suspicious circumstances and fail to inform the client of missing invoices, thereby enabling an employee’s defalcations to go unnoticed. And in United States v. Natelli, 527 F.2d 311, 320 (2nd Cir.1975), cert. denied, 425 U.S. 934, 96 S.Ct. 1663, 48 L.Ed.2d 175 (1976), it was held that auditors preparing an unaudited financial statement in connection with a proxy statement for filing with the Securities Exchange Commission had a duty to investigate suspicious circumstances. Similarly, in Blakely v. Lisac, 357 F.Supp. 255, 265-266 (D.Or.1972), it was held that an accountant preparing an “unaudited write-up” had to undertake at least minimal investigation of figures supplied and was not free to ignore suspicious circumstances. See also: Ryan v. Kanne, 170 N.W.2d 395, 404 (Iowa 1969) (accountant liable for negligence in preparing report of accounts payable even though statement unaudited and accountant expressly disclaimed knowledge that information was correct); Bohhiver v. Graff, 311 Minn. 111, 118-129, 248 N.W.2d 291, 297-299 (1976) (accountants having unaudited engagement to bring insurance company’s books “up to date” are liable for negligence in failing to examine books made available to them when such an examination would have disclosed the insurance company’s insolvency).

When Touche Ross agreed to provide unaudited accounting services for Wooler, it undertook to exercise that degree of accounting skill possessed by other accountants in the community. Touche Ross’ obligation required that its personnel be reasonably alert to internal control defects which were patently obvious. Witnesses for the Bank and the accountant agreed that Wooler’s internal controls had been defective and had thereby increased the potential for defalcations by a dishonest employee. They agreed that such a danger is inevitably present when the same employee is responsible to post accounts receivable in a sales journal, to handle incoming receivables, and to record daily receipts of moneys received in settlement of accounts receivable. Raichle, it was agreed, performed all these duties for Wooler. There was evidence that on the occasions when Touche Ross sent an accounting employee to examine Wool-er’s books, that person worked in close proximity to Raichle and observed her perform these several functions. Expert witnesses uniformly expressed the opinion that an accountant possessing reasonable accounting skill would have been aware of the potential for theft inherent in Wooler’s internal controls.

Moreover, there was evidence that Touche Ross had supplied to employees who examined Wooler’s financial records checklists entitled “Scope of Inquiries.” These checklists reminded the accountant’s employees to inquire into Wooler’s allocation of bookkeeping duties. As a matter of practice, Touche Ross employees were instructed to be “alert for possible improvements in the client’s accounting policies and procedures, system of internal control and accounting personnel and the assignment of duties.”

From this evidence, the trial court found that Touche Ross’ accounting personnel had “failed to use reasonable care in being alert” and had “failed to make the necessary inquiries in accordance with reasonable professional standards so as to discover what was readily discoverable to it in order to protect plaintiff.” (Finding of Fact # 26). This finding was sustained by the court en banc and is supported by the evidence. We will not disturb it on appeal. See generally: Bethlehem Steel Corp. v. Litton Industries, Inc., 321 Pa.Super. 357, 366-367, 468 A.2d 748, 752 (1983) (findings of trial judge, affirmed by the court en banc, have the effect of a jury verdict and will not be disturbed on appeal if supported by the record). Accord: Bachman v. Artinger, 285 Pa.Super. 57, 60-61, 426 A.2d 702, 704 (1981); Yates v. Clifford Motors, Inc., 283 Pa.Super. 293, 299, 423 A.2d 1262, 1265 (1980).

Because Touche Ross breached its duty to exercise the care and skill customarily exercised by an accountant, it can be made to respond in damages if its negligence was a substantial factor in bringing about Wooler’s loss by employee defalcations. The trial judge, believing that liability could not be imposed upon Touche Ross because it had been improperly joined as an additional defendant, did not consider and made no findings regarding the issue of causation. He made no further findings after he had held that Touche Ross could not be held liable because it had been improperly joined as an additional defendant. This was error.

If Touche Ross violated a duty of care owed to Wooler and if its negligence was a substantial factor in causing Wooler’s loss, the trial court could not refuse to impose liability on Touche Ross merely because its joinder as an additional defendant should not, in the trial judge’s opinion, have been allowed previously by another judge.

In the first place, the joinder was proper. Wooler had sustained a loss because an unfaithful employee had wrongfully diverted checks intended for her employer. Wooler sought to recover the loss thereby sustained from the Bank in an action in which it contended that the Bank had been negligent in failing, contrary to commercially reasonable practices, to detect the forgeries on checks deposited by the faithless employee. It was the Bank’s negligence, Wooler contended, which had made diversions of checks possible and had prevented immediate detection. The Bank joined Touche Ross on grounds that it was jointly and severally liable because its negligence had also made possible the diversions of Wooler’s checks and had prevented detection of the employee’s peculations. Such joinder was proper. Pa.R.C.P. 2252(a) has specifically authorized the joinder of any person who is alleged to be jointly and/or severally liable with the defendant on the cause of action alleged by the plaintiff.

Secondly and in any event, the trial judge could not properly overrule the earlier order of another judge which had specifically allowed the joinder of Touche Ross as an additional defendant. “Absent some new evidence, it is improper for a trial judge to overrule an interlocutory order by another judge of the same court in the same case.” Bersani v. School District of Philadelphia, 310 Pa.Super. 1, 4, 456 A.2d 151, 153 (1982). See: Walker v. Pugliese, 317 Pa.Super. 595, 598 n. 1, 464 A.2d 482, 483-484 n. 1 (1983); Commonwealth v. Eck, 272 Pa.Super. 406, 409, 416 A.2d 520, 522 (1979); Marmara v. Rawle, 264 Pa.Super. 229, 238, 399 A.2d 750, 755 (1979); Vitale v. Zoning Hearing Board of Upper Darby Township, 63 Pa.Cmwlth. 604, 607, 438 A.2d 1016, 1018 (1982); Commonwealth v. Tyson, 57 Pa.Cmwlth. 569, 575, 427 A.2d 283, 286 (1981). The propriety of Touche Ross’ joinder had been raised pre-trial in preliminary objections. The preliminary objections had been overruled, and thereafter the case had proceeded with Touche Ross as an active participant. Trial was non-jury. Any danger of confusion that might possibly have been caused by joining issues of liability on the part of different parties was minimal, for the trial judge, being learned in the law, could readily discern the different issues and decide them separately. Therefore, even if the trial court did believe that the joinder of Touche Ross had been irregular, this was not an adequate basis on which to decide that the additional defendant was not substantively liable if found negligent.

After the trial court found from the evidence that Touche Ross had been negligent, it was then incumbent upon the court to determine whether such negligence had been a substantial factor in causing Wooler’s loss. Upon remand, the trial court should make an appropriate finding relative to the existence or nonexistence of a causal connection between the negligence of Touche Ross and the loss sustained by Wooler.

The Bank also argues that the trial court erred by adding pre-judgment interest of $77,228.00 to a compensatory damage award of $150,848.77. Wooler’s cause of action against the Bank was in tort, not contract. As a general rule, interest as such is not recoverable in tort actions where the damages sought are unliquidated. Marrazzo v. Scranton Nehi Bottling Co., 438 Pa. 72, 74, 263 A.2d 336, 337 (1970) (collecting cases). To the extent that prejudgment interest is recoverable in tort cases, it is more accurately identified as compensation for delay. See: American Enka Co. v. Wicaco Machine Corp., 686 F.2d 1050, 1056 (3rd Cir.1982).

Pursuant to Pa.R.C.P. 238, which became effective April 15, 1979, a plaintiff who recovers a verdict for personal injury, death or property damage is entitled under certain enumerated circumstances to receive an additional award of interest at the rate of ten percent from the date of the complaint. See: Laudenberger v. Port Authority of Allegheny County, 496 Pa. 52, 436 A.2d 147 (1981), appeal dismissed sub nom. Bucheit v. Laudenberger, 456 U.S. 940, 102 S.Ct. 2002, 72 L.Ed.2d 462 (1982). Delay damages have also been recovered in tort actions when considerations of justice and fair dealing have required it. See generally: Aviation Associates of Puerto Rico v. Dixon Co., 333 F.Supp. 982 (M.D.Pa.1971); Conover v. Bloom, 269 Pa. 548, 112 A. 752 (1921); Richards v. Citizens Natural Gas Co., 130 Pa. 37, 18 A. 600 (1889). Double recovery, however, is not permitted. If there is a recovery of delay damages under Pa.R.C.P. 238, there can be no recovery under common law principles enumerated in Marrazzo v. Scranton Nehi Bottling Co., supra. See: American Enka Co. v. Wicaco Machine Corp., supra at 1057.

In the instant case, Pa.R.C.P. 238 can have no application. The action was pending when the rule went into effect; and the rule specifically provides that it shall not be applicable to pending actions. Whether delay damages, measured according to the legal rate of interest, are due under common law principles is an issue of fact. Applicable principles have been stated repeatedly by the Supreme and Superior Courts. In Marrazzo v. Scranton Nehi Bottling Co., supra 438 Pa. at 74-75, 263 A.2d at 337, the Supreme Court said:

This Court ... has developed the doctrine that: “... there are cases sounding in tort, and cases of unliquidated damages, where not only the principle on which the recovery is to be had is compensation, but where also the compensation can be measured by market value, or other definite standards. Such are cases of the unintentional conversion or destruction of property, etc. Into these cases the element of time may enter as an important factor, and the plaintiff will not be fully compensated unless he receive, not only the value of his property, but receive it, as nearly as may be, as of the date of his loss. Hence it is that the jury may allow additional damages, in the nature of interest, for the lapse of time. It is never interest as such, nor as a matter of right, but compensation for the delay, of which the rate of interest affords the fair legal measure.” Richards v. Citizens Natural Gas Company, 130 Pa. 37, 40, 18 A. 600 (1889). Irvine v. Smith, 204 Pa. 58, 53 A. 510 (1902); Stevenson v. Ebervale Coal Company, 203 Pa. 316, 52 A. 201 (1902); Klages v. Philadelphia & Reading Terminal Co., [160 Pa. 386, 28 A. 862 (1894)]; Campbell v. Baltimore & Ohio Railroad Company, 58 Pa.Superior Ct. 241 (1914). We have emphasized that compensation for delay in payment is not a matter of right but is an issue for the finder of fact, the resolution of which depends upon all the circumstances of the case, (emphasis added).

The Marrazzo Court quoted further from Pierce v. Lehigh Valley Coal Co. (No. 2), 232 Pa. 170, 172, 81 A. 142, 143 (1911) as follows:

The right to compensation ... is, therefore, usually a question for the [fact finder] under the evidence submitted. If the fault in nonpayment of the claim rests with the defendant he cannot complain if he is required to compensate for the delay. If on the other hand the fault lies with the plaintiff by reason of an excessive and unconscionable demand, one which the defendant is required to protect himself against by litigation, he should not be penalized for the unwarranted conduct of the plaintiff and required to pay damages for the delay in the settlement of the claim.” Conover v. Bloom, 269 Pa. 548, 112 A. 752 (1921); Stevenson v. Ebervale Coal Company, supra; Mead v. Central Pennsylvania Traction Company, 54 Pa.Superior Ct. 400 (1913). The theory behind this element is the belief that the defendant would have been willing to settle the case at a much earlier stage if the plaintiff had made a reasonable demand and because the plaintiff made an unreasonable demand he cannot complain that he had not had the use of the money during the period of litigation. The burden of proving that the demand was unreasonable is upon the defendant. Conover v. Bloom, supra.

Id., 438 Pa. at 75-76, 263 A.2d at 338. (emphasis added).

In Murray Hill Estates, Inc. v. Bastin, 442 Pa. 405, 276 A.2d 542 (1971), the Supreme Court quoted with approval from McDermott v. McDermott, 130 Pa.Super. 127, 130, 196 A. 889, 890 (1938) as follows:

An examination of the cases dealing with the charge and allowance of interest will disclose many difficulties, but the decided trend of courts of law and courts of equity has been ‘to break away from hard and fast rules and charge and allow interest in accordance with principles of equity, in order to accomplish justice in each particular case' ... Unless a case be found, which is a conclusive precedent, the safest and at the same time the fairest way for a court is to decide questions pertaining to interest according to a plain and simple consideration of justice and fair dealing.

Id., 442 Pa. at 410, 276 A.2d at 545.

In a case where the trial judge had made no findings and had stated no reasons for making an award of interest, this Court, per Cercone, P.J., said:

The trial judge in Marrazzo, as here, did not indicate his reason for awarding interest and the Supreme Court, therefore, vacated and remanded the record for the trial court to make findings of fact and conclusions of law as to the delay. Likewise, we remand the record to the trial court for an assessment of responsibility for the delay, as well as the basis for imposing and computing the amount of “delay compensation.” “All circumstances relevant to the delay must be developed and analyzed.” Marrazzo, 438 Pa. at 77, 263 A.2d at 338. The trial court should articulate what legal standard he is employing and “what circumstances he considered in arriving at his decision." Id., 438 Pa. at 76, 263 A.2d at 338.

Wade v. S.J. Groves & Sons Co., 283 Pa.Super. 464, 477-478, 424 A.2d 902, 908-909 (1981) (emphasis added) (footnote omitted).

This case must be remanded. Upon remand, the trial court should make findings with respect to whether Touche Ross’ negligence was a substantial factor in causing Wooler’s loss. It should also make findings and determine whether Wooler is entitled to recover compensation for delay.

Judgment reversed, and case remanded to the trial court for proceedings consistent with this opinion. Jurisdiction is not retained.

      . The Uniform Commercial Code, at 13 Pa.C.S. § 3419(a) provides that an instrument is converted when "it is paid on a forged indorsement." See: Anno., 23 ALR 4th 855 (1983). However, a depository or collecting bank, "who has in good faith and in accordance with the reasonable commercial standards applicable to the business of such representative dealt with an instrument or its proceeds on behalf of one who was not the true owner is not liable in conversion or otherwise to the true owner beyond the amount of any proceeds remaining in his hands.” 13 Pa.C.S. § 3419(c). This defense, as the statute expressly provides, is not available where a depositary or collecting bank has failed to act in a commercially reasonable manner. Accord: Cooper v. Union Bank, 9 Cal.3d 371, 107 Cal.Rptr. 1, 507 P.2d 609 (1973); National Surety Corp. v. Citizens State Bank, 41 Colo.App. 580, 593 P.2d 362 (1978), aff’d, 199 Colo. 497, 612 P.2d 70 (1980); National Bank of Georgia v. Refrigerated Transport Co., 147 Ga.App. 240, 248 S.E.2d 496 (1978); Aetna Casualty and Surety Co. v. Hepler State Bank, 6 Kan.App.2d 543, 630 P.2d 721 (1981); Sherriff-Goslin Co. v. Cawood, 91 Mich.App. 204, 283 N.W.2d 691 (1979); Salsman v. National Community Bank, 102 N.J.Super. 482, 246 A.2d 162 (1968), aff’d, 105 N.J.Super. 164, 251 A.2d 460 (1969); Sonnenberg v. Manufacturers Hanover Trust Co., 87 Misc.2d 202, 383 N.Y.S.2d 863 (1976); North Carolina National Bank v. McCarley & Co., 34 N.C.App. 689, 239 S.E.2d 583 (1977); Atlas Building Supply Co. v. First Independent Bank, 15 Wash.App. 367, 550 P.2d 26 (1976). Compare: Drug House, Inc. v. Keystone Bank, 272 Pa.Super. 130, 414 A.2d 704 (1979).

      . The Bank has also attempted to argue on appeal that the opinion testimony of an expert witness produced by Wooler should not have been received because the record failed to show the facts upon which his opinion was based. However, this issue was not raised in the Bank’s exceptions filed in the trial court; and, therefore, it has been waived. Pa.R.C.P. 1038(d). See also: Red Oak Co. v. Kempton, 298 Pa.Super. 516, 518, 445 A.2d 108, 109 (1982); Zvonik v. Zvonik, 291 Pa.Super. 309, 314 n. 2, 435 A.2d 1236, 1239 n. 2 (1981); In re Custody of Frank, 283 Pa.Super. 229, 233, 423 A.2d 1229, 1232 (1980).

      . Comment b of section 299A specifically suggests that this standard is applicable to accountants.

      . This excerpt is from exhibit D-3, Touche Ross’ "Program for Review of Unaudited Financial Statements,’’ which was in effect from August, 1972 through 1974. A similar program had been in effect from 1968 to 1972.

      . In contract cases, a successful plaintiff is entitled to pre-judgment interest at the statutory rate as a matter of right; it is calculated from the time the debt became due or payable. See: Penneys v. Pennsylvania R.R. Co., 408 Pa. 276, 279-280 & n. *, 183 A.2d 544, 546 & n. 1 (1962); Gold & Co. v. Northeast Theater Corp., 281 Pa.Super. 69, 76, 421 A.2d 1151, 1154 (1980); Oxford Mfg. Co. v. Cliff House Building

        Corp., 224 Pa.Super. 387, 389, 307 A.2d 343, 345 (1973). See also: American Enka Co. v. Wicaco Machine Corp., 686 F.2d 1050, 1056 (3rd Cir.1982); Interlake, Inc. v. Erie Indus. Trucks, Inc., 427 F.Supp. 1012, 1013 (W.D.Pa.1977).

      . Pa.R.C.P. 238 provides:
      Rule 238. Award of Damages for Delay in an Action for Bodily Injury, Death or Property Damage
      (a) Except as provided in subdivision (e), in an action seeking monetary relief for bodily injury, death or property damage, or any combination thereof, the court or the arbitrators appointed under the Arbitration Act of June 16, 1836, P.L. 715, as amended, 5 P.S. § 30 et seq., or the Health Care Services Malpractice Act of October 15, 1975, P.L. 390, 40 P.S. § 1301.101 et seq., shall
      (1) add to the amount of compensatory damages in the award of the arbitrators, in the verdict of a jury, or in the court’s decision in a nonjury trial, damages for delay at ten (10) percent per annum, not compounded, which shall become part of the award, verdict or decision;
      (2) compute the damages for delay from the date the plaintiff filed the initial complaint in the action or from a date one year after the accrual of the cause of action, whichever is later, up to the date of the award, verdict or decision.
      (b) In arbitration under the Act of 1836, the amount of damages for delay shall not be included in determining whether the amount in controversy is within the jurisdiction of the arbitrators.
      (c) Except as provided in subdivision (e), damages for delay shall be added to the award, verdict or decision against all defendants found liable, no matter when joined in the action.
      (d) The court may, and on request of a party shall, charge the jury that if it finds for the plaintiff, it shall not award the plaintiff any damages for delay because this is a matter for the court.

        (e) If a defendant at any time prior to trial makes a written offer of settlement in a specified sum with prompt cash payment to the plaintiff, and continues that offer in effect until commencement of trial, but the offer is not accepted and the plaintiff does not recover by award, verdict or decision, exclusive of damages for delay, more than 125 percent of the offer, the court or the arbitrators shall not award damages for delay for the period after the date the offer was made.
      (f) If an action is pending on the effective date of this rule, or if an action is brought after the effective date on a cause of action which accrued prior to the effective date, damages for delay shall be computed from the date plaintiff files the initial complaint or from a date one year after the accrual of the cause of action, or from a date six (6) months after the effective date of this rule, whichever date is later.
      (g) This rule shall not apply to
      (1) eminent domain proceedings:
      (2) pending actions in which damages for delay are allowable in
      the absence of this rule.
      (notes omitted).