author: CERCONE, Judge:

text:
    602 A.2d 380
    Roberta A. MELAT, Appellant, v. David H. MELAT, Karen S. Hoovler.
    Superior Court of Pennsylvania.
    Argued July 31, 1991.
    Decided Jan. 28, 1992.

      Wayne J. Aaron, Erie, for appellant.
    Michael J. Antkowiak, Oil City, for Melat, appellee.
    David W. Swanson, Warren, for Hoovler, appellee.
    Before McEWEN, OLSZEWSKI and CERCONE, JJ.
   CERCONE, Judge:

This is an appeal from the order of the Court of Common Pleas of Venango County dated January 14, 1991, granting summary judgment in favor of appellees, David Melat (hereinafter referred to as “husband”) and Karen Hoovler, his present spouse, and against appellant, husband’s former wife, Roberta Melat (hereinafter referred to as “wife”). We reverse.

The facts of this case are eruditely set forth in the trial court’s opinion as follows:

This action arises out of a long series of protracted litigation dating back to 1982, concerning divorce proceedings, alimony and support obligations, and property settlements. [Appellant], Roberta Melat, and [appellee], David Melat, were formerly husband and wife. During their marriage, they acquired certain real property which has been referred to by the parties as the “Redfield property.” The premises were conveyed by the [wife] and [husband], David Melat, to the [husband], David Melat, by deed dated March 7, 1985, as part of various stipulations agreed to in the divorce action, A.D. No. 9— 1982. By deed dated July 26, 1985, and recorded on August 1, 1985, the [husband], David Melat, and his present wife, the [appellee] Karen [Hoovler], conveyed the parcel of land known as the Redfield property located in Cherrytree Township, Venango County, to themselves as tenants by the entireties.
As part of the divorce agreement, the [husband], David Melat, executed a note evidencing indebtedness to the [wife] in the amount of $150,000.00, payable in three installments of $50,000.00 each, commencing on or before the first day of the first calendar month following the calendar month in which an absolute decree in divorce was granted, with the second and third installments being due 90 and 180 days thereafter. A final decree in divorce was granted on April 26, 1985 at A.D. No. The [husband], David Melat, failed to make payments on the note as provided in the divorce agreement and the [wife] thereafter confessed judgment on the note in separate proceedings entered in this court at C.D. No. Thereafter and following protracted litigation and negotiations, the [wife] and [husband], David Melat, entered into a stipulation approved by Order of Court, both being dated March 21,1988, and entered at A.D. No. in this Court. The stipulation in pertinent part states that the [wife] shall withdraw all judgements secured against the [husband], David Melat, regarding the unpaid note, child support and alimony. The [wife] also agreed to discontinue a civil action filed at A.D. No. and that all obligations contained in the divorce agreement shall be deemed to commence on January 1, 1988, and each party waives any claim which he or she may have as a result of the nonperformance of any of the terms or conditions of the agreement occurring prior to January 1, 1988. The parties then agreed on a new payment structure on the note.
[Husband], David Melat, has once again failed to pay on the note and [wife] now seeks to set aside the execution and delivery of the deed to the Redfield property from the [husband], David Melat, to himself and his present wife, the [appellee], Karen [Hoovler], dated July 6, 1985. [Wife] contends the execution and delivery of the foregoing deed constituted a fraudulent conveyance against her because it was made without consideration at a time when the [husband], David Melat, was indebted to the [wife] on a judgment note dated March 27, 1985, in the amount of $150,000.00 and under a marital settlement agreement dated March 27,1985, whereby the [husband], David Melat, was indebted in the amount of $450,000.00 to the [wife].

Lower court opinion at 1-3. Appellees filed a motion for summary judgment on the grounds that the stipulation extinguished any claim wife might have under the Fraudulent Conveyance Act because the stipulation extinguished husband’s initial liability. In granting summary judgment in favor of husband and Ms. Hoovler, the trial court reasoned that the stipulations entered into on March 21, 1988 served as a novation which extinguished the original property settlement agreement, as well as appellant’s rights under that agreement. The trial court concluded that since wife conveyed the property in in 1985, three years before the parties agreed to the present stipulation, she was not a creditor under the Fraudulent Conveyance Act. 39 P.S. § 351 et seq. Appellant filed a motion for reconsideration which was denied and this timely appeal followed. Appellant presents us with one issue for our consideration: whether the 1988 stipulation constituted a novation which waived appellant’s fraudulent conveyance claims.

As a preliminary matter, appellee Hoovler contends that appellant’s claims are barred under the doctrine of res judicata. Specifically, she maintains that appellant sought to have the conveyance presently at issue voided in previous divorce proceedings. However, our inspection of the record discloses that the trial judge never considered this claim as it relied solely on the contractual issues in granting summary judgment. Although the entire record of the previous proceedings is not before us, the present record is sufficient to dispose of appellant’s claim. Ms. Hoovler has not clearly explained whether she is arguing res judicata (more commonly known as claim preclusion) or collateral estoppel (more commonly known as issue preclusion). We will therefore dispose of both theories.

Our supreme court has recently set forth tests to apply for both situations. Application of the doctrine of res judicata requires the concurrence of four elements: (1) identity of the thing sued for; (2) identity of the cause of action; (3) identity of the persons and parties to the action; and (4) identity of the quality in the persons for or against whom the claim is made. City of Pittsburgh v. Zoning Board of Adjustment, 522 Pa. 44, 54, 559 A.2d 896, 901 (1989). Here, it is relatively clear that parts (1), (3) and (4) of the test have been met. The thing sued for in both actions is the Redfield property and the parties in both actions are husband, wife and Ms. Hoovler.

The cause of action being asserted here, however, is quite different from the cause of action raised during the equitable distribution proceedings. As Ms. Hoovler concedes, wife filed motions to set aside the conveyance on the grounds that the equitable distribution was, in fact, inequitable. See Amended Answer and New Matter filed by appellee Hoovler, paragraphs 33 and 34; Hoovler Motion for Summary Judgment, paragraph 8. This claim was brought pursuant to a motion for special relief, a procedure available under the Pa.Rules of Civil Procedure governing divorce actions. See Pa.R.Civ.P. Rule 1920.43, 42 Pa.C.S.A., and the Pennsylvania Divorce Code, 23 Pa.C.S.A. § 3101 et seq. Wife’s present cause of action seeks to avoid the conveyance under the Fraudulent Conveyance Act, as Husband’s conveyance to himself and Ms. Hoovler rendered him insolvent and unable to compensate wife under the settlement agreement as modified. These two causes of action are not identical. Therefore, the doctrine of claim preclusion does not apply to preclude wife’s cause of action.

Collateral estoppel seeks to preclude a litigant from raising an issue which has previously been determined and applies if (1) the issue decided in the prior case is identical to the one presented in the later case; (2) there was a final judgment on the merits; (3) the party against whom the plea is asserted was a party or in privity with a party in the prior case; (4) the party or person privy to the party against whom the doctrine is asserted had a full and fair opportunity to litigate the issue in the prior proceeding; and (5) the determination in the prior proceeding was essential to the judgment. Id., 522 Pa. at 55, 559 A.2d at 901. Again, appellee Hoovler argues that wife’s petitions for special relief concerned whether the distribution of property under the settlement agreement was equitable. Here, wife seeks to reclaim the Redfield property because husband has failed to remunerate wife for the conveyance. Thus, wife is not now attempting to relitigate the equitable distribution, but rather is trying to reclaim the property as a fraudulent conveyance. The issue presented here is not the same as the issue previously litigated. Therefore, wife’s claim is not barred by the doctrine of collateral estoppel.

We now turn to the merits of this case. As an appellate court, we are bound to consider certain principles which dictate when and under what circumstances a trial court may properly enter summary judgment. Goebert v. Ondek, 384 Pa.Super. 100, 104, 557 A.2d 1064, 1066 (1989). The trial court must accept as true all well-pleaded facts in the non-moving party’s pleadings, and give to him or her the benefit of all reasonable inferences to be drawn therefrom. Jefferson v. State Farm Insurance Co., 380 Pa.Super. 167, 170, 551 A.2d 283, 284 (1988). Summary judgment should not be entered unless the case is clear and free from doubt. Hathi v. Krewstown Park Apartments, 385 Pa.Super. 613, 615, 561 A.2d 1261, 1262 (1989). A grant of summary judgment is proper where the pleadings, depositions, answers to interrogatories and admissions on file support the lower court’s conclusion that no genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law. Pa.R.Civ.P. Rule 1035, 42 Pa.C.S.A.; Hatter v. Landsberg, 386 Pa.Super. 438, 440-41, 563 A.2d 146, 147-48 (1989). See Penn Center House, Inc. v. Hoffman, 520 Pa. 171, 176, 553 A.2d 900, 903 (1989) (entire record before lower court must be thoroughly examined and all doubts as to the existence of a genuine issue of material fact are to be resolved against a grant of summary judgment). We will overturn a trial court’s entry of summary judgment only if there has been an error of law or a clear abuse of discretion. McCain v. Pennbank, 379 Pa.Super. 313, 318, 549 A.2d 1311, 1313 (1988). With our standard of review in mind, we turn to the circumstances of appellants’ case.

In Pennsylvania, a settlement agreement between a husband and wife is governed by the law of contracts unless the agreement itself provides otherwise. Jackson v. Culp, 400 Pa.Super. 519, 522, 583 A.2d 1236, 1238 (1990). As the property settlement agreement in the instant case does not otherwise provide, we will dispose of this case under general contract principles. Wife argues that the stipulation agreed upon in March, 1988 served to modify the property settlement agreement to allow husband additional time to comply with the agreement. In contrast, husband and Ms. Hoovler argue that the new stipulation served as a novation which extinguished all prior rights in the original property settlement agreement. These diametrically opposed arguments call on us to analyze the differences between novations and modifications of contracts.

This court has previously held that a novation may only be found where the evidence demonstrates “the displacement and extinction of a valid contract, the substitution for it of a valid new contract, ..., a sufficient legal consideration for the new contract, and the consent of the parties. Buttonwood Farms, Inc. v. Carson, 329 Pa.Super. 312, 317, 478 A.2d 484, 486 (1984) (emphasis in original). The party asserting a novation of substituted contract has the burden of proving that the parties intended to discharge the earlier contract. Id. After reviewing the terms of the 1988 stipulation, we conclude that by its own terms a novation is not present here. The following excerpt from the stipulation evidence the lack of a novation:

1. Except as modified by this Stipulation, the Property Settlement Agreement of the parties dated March 27, 1985 (the Agreement), shall remain in full force and effect and the same is hereby ratified and confirmed.

Stipulation of March 21, 1988, paragraph 1 (emphasis added). The above-referenced language in the stipulation clearly indicates that the parties did not intend to substitute the stipulation for the original agreement. The language speaks of the agreement as modified, thereby indicating that no novation occurred.

A modification does not displace a prior valid contract; rather, the new contract acts as a substitute for the original contract, but only to the extent that it alters it. Knight v. Gulf Refining Co., 311 Pa. 357, 360, 166 A. 880, 881 (1933). The original contract may be abrogated in part, with the residue remaining intact. Egyptian Sand Real Estate, Inc. v. Polony, 222 Pa.Super. 315, 321, 294 A.2d 799, 803 (1972). See also 8 Pennsylvania Law Encyclopedia § 294 (1971). As previously mentioned, the stipulation expressly states that the original agreement remains in full force and effect. Therefore, the parties here intended a modification of the agreement. Accordingly, we must now ascertain the effect of this modification on the rights and liabilities of the parties.

Wife contends that the modification merely served to extend husband’s time for performance under the original agreement. We agree. The pertinent provisions in the stipulation concerning the parties rights and liabilities are set forth in the stipulation as follows:

3. The parties acknowledge that the Wife has secured a judgment against the Husband in the amount of $150,-000.00 and has also secured a judgment, or judgments which [sic] respect to unpaid child support and alimony. All of such judgments shall be withdrawn by the Wife. The Husband shall deliver to the Wife the original note in the amount of $150,000.00 to be held by her pending payment thereof.
4. The Wife shall settle and mark discontinued that certain Civil Action filed in the office of the Prothono-tary of Venango County at A.D. No. 268, 1986.
5. Any obligation of the Wife to the Husband or the Husband to the Wife contained in the agreement shall be deemed to commence on January 1, 1988 and each party hereto waives any claim which he or she may have as a result of any nonperformance of any of the terms or conditions of the [sic] occurring prior to January 1, 1988.
* * * * * *
7. Default in payment of the obligation of the Husband ... hereof shall entitle the Wife to exercise the enforcement provisions of the said Note. Default in payment of the Husband’s obligations under the Agreement shall give rise to the remedies set forth in the Agreement.
8. Waiver of past default as set forth hereinabove [sic] shall not impair the rights of the parties hereto to exercise any remedy available upon default occurring after January 1, 1988.

Stipulation, 3/21/88. The pertinent clauses in the stipulation demonstrate that husband’s time to perform the obligations under the note was extended until January 1, 1988. Wife was required to discontinue all actions brought to enforce her rights under the original agreement, and to waive all claims from this breach of agreement. This does not mean, however, that husband had no liability to Wife before that time. As early as 1985, husband entered into a contractual agreement which called upon him to execute and pay on a note in exchange for Wife’s conveyance of the Redfield property to him. It is well established that a modified agreement supplements the original contract. Memphis, etc., Railroad Co. v. Wilcox, 48 Pa. 161, 167 (1864). Under a modified agreement, liability of the parties is still established from the original agreement. Id. See also 8 Pennsylvania Law Encyclopedia, supra. Therefore, although Wife transferred the property to husband before husband and wife agreed on the modifying stipulation, husband’s contractual liability to execute and pay on the note was established from the original agreement. To find otherwise would reduce wife’s actions to nothing more than an altruistic conveyance of property to husband. The absurdity of this result is evident. The true effect of the subsequent modification is that wife could not sue husband for breach of contract until January 1, 1988 or thereafter. Under the modified agreement, any claim before January 1, 1988, would have been premature. This does not mean that husband had no contractual obligation to execute a note to wife prior to that time, but rather, that he was not required to do so before January 1, 1988. Further, under the 1988 stipulation, wife retained all remedies previously available to her under the original agreement.

Since husband was liable to wife in 1985 under the original agreement, we must now ascertain the effect of this contractual liability on wife’s claim under the Fraudulent Conveyance Act (Act). Wife brought two claims under the Act. Her first claim was under Section 4, and the second claim was brought under section 7. The Act further defines a “creditor” as “a person having any claim, whether matured or unmatured, liquidated or unliquidated, absolute, fixed or contingent.” 39 P.S. § 351. “Debt” is defined as “any legal liability, whether matured or unma-tured, liquidated or unliquidated, absolute fixed or contingent.” Id. In the instant case, by reason of her conveyance, wife had an unmatured claim against husband for fraudulent conveyance. Husband had an unmatured debt which he owed to wife arising from the 1983 property settlement agreement. See Baker v. Geist, 457 Pa. 73, 321 A.2d 634 (1974) (appellant was a creditor where liability was based on conduct which occurred before the alleged fraudulent conveyances were made). In fact, wife had remedies under the Fraudulent Conveyance Act, even though her claim was premature. See 39 P.S. § 360 (rights of creditors whose claims have not matured).

Moreover, in Amadon v. Amadon, 359 Pa. 434, 59 A.2d 135 (1948), our supreme court held that a former spouse is a creditor of her ex-husband for purposes of the Act. In that case, a wife sued her former husband and his new wife to reclaim certain property in lieu of monthly alimony payments for which husband was in default pursuant to a property settlement agreement. Id., 359 Pa. at 436, 59 A.2d at 136. After the suit was instituted, husband contributed one half of the sum for his new wife to purchase the property. Id., 359 Pa. at 436-37, 59 A.2d at 136. The supreme court held that plaintiff-wife was a creditor for purposes of the Fraudulent Conveyance Act because the monthly payment husband owed to wife was a legal liability within the meaning of the term “debt.” Id., 359 Pa. at 439, 59 A.2d at 137.

Similarly, wife, in the case sub judice, was entitled to pursue her claims of fraudulent conveyance. She held the status of creditor from the moment she entered into the original property settlement agreement with husband. Id. Wife has done nothing but act in accordance with both the original property settlement agreement and the agreement as modified, while husband has done everything to elude his obligation to wife. Wife has sufficiently established her status as a creditor for purposes of both Sections 4 and 7 of the Fraudulent Conveyance Act. Based on the foregoing, we hold that the trial court committed a clear error of law in determining that a novation occurred. We therefore reverse the order of the trial court granting summary judgment and remand for further proceedings.

Order vacated; the case is remanded for further proceedings consistent with this opinion; jurisdiction is relinquished.

      . Section 4 of the Fraudulent Conveyance Act states:
      Every conveyance made and every obligation incurred by a person who is or will be thereby rendered insolvent, is fraudulent as to creditors, without regard to his actual intent, if the conveyance is made or the obligation is incurred without a fair consideration.
      39 P.S. § 354.

      . Section 7 of the Fraudulent Conveyance Act states:
      Every conveyance made and every obligation incurred with actual intent, as distinguished from intent presumed in law, to hinder, delay, or defraud either present or future creditors, is fraudulent as to both present and future creditors.

        Id. § 357.

      . Wife also argues that the note which husband executed and defaulted upon was not part of the original settlement agreement and therefore her rights under the note could not be extinguished. In light of our holding, we need not reach this argument. Despite the lack of reference to the note in the original agreement, the note was referred to in the 1988 stipulation and is therefore governed by that stipulation to the extent so provided.


source: Caselaw Access Project

author: JOHNSON, Judge. WIEAND, Judge,

license: Public Domain

text:
    602 A.2d 864
    Joseph AMBROSE and Janet Ambrose, Appellants, v. CROSS CREEK CONDOMINIUMS.
    Superior Court of Pennsylvania.
    Argued Dec. 3, 1991.
    Filed Feb. 3, 1992.

      Patrick T. Davish, Philadelphia, for appellants.
    George P. Noel, Media, for appellee.
    Before ROWLEY, President Judge, and WIEAND and JOHNSON, JJ.
   JOHNSON, Judge.

Joseph and Janet Ambrose, húsband and wife (Plaintiffs), appeal from an order which simultaneously overruled their preliminary objections to the preliminary objections of Cross Creek Condominiums (Defendant), and dismissed Plaintiffs’ complaint with prejudice for lack of personal jurisdiction over Defendant. We are asked to decide whether a written agreement for an extension of time to file a responsive pleading arose from an exchange of letters between the parties, and whether such an agreement could operate as a waiver of Defendant’s right to challenge personal jurisdiction through preliminary objections. We are also asked to determine whether Pennsylvania Rule of Civil Procedure 1028(d), 42 Pa.C.S., affords to a plaintiff, whose objections are overruled, a right within a fixed period of time to file a responsive pleading to outstanding preliminary objections.

After review of the certified record and consideration of the arguments set forth in the parties’ briefs, we agree with the trial court that a meeting of the minds for an extension of time did not arise and therefore, the right to challenge personal jurisdiction was not waived. We conclude, however, that Plaintiffs retained the right to file a responsive pleading on the merits to the remaining, original preliminary objections, upon the disposition of the Plaintiffs’ preliminary objections. Plaintiffs were deprived of this right by the simultaneous overruling of their objections and the dismissal of the suit on jurisdictional grounds. We reverse the order which overruled Plaintiff’s objections and simultaneously dismissed the complaint, and remand for further proceedings.

On November 27, 1990, Plaintiffs commenced a civil action alleging injuries which arose from an alleged slip and fall on Defendant’s property in Colorado during March, 1990. Plaintiffs served the Complaint outside the Commonwealth by certified mail, pursuant to Pa.R.C.P. 404(2) and 405(c). The Complaint and Notice to Defend were received by Defendant on December 4, 1990.

On January 2, 1991, Plaintiffs’ counsel received a letter dated December 28, 1990 from Defendant’s counsel. The body of the letter set forth the following:

Please be advised that the above matter has just been referred to this firm. Apparently, the suit was filed in Delaware County sometime in early December by the suit papers were sent to the Colorado office of the Defendant.
I intend to enter my appearance as soon as I receive a copy of the Complaint.
At this time, I am requesting an extension of time to answer the Complaint and will assume that the extension is granted unless I hear from you to the contrary.
Thank you for your courtesy and cooperation, in particular with my concern for actually having the complaint in hand.

Plaintiffs’ Preliminary Objections, etc., Exhibit A; Appellants’ Record (R.R.), page 45. Upon receiving the letter, Plaintiffs’ counsel telephoned Defendant’s counsel and indicated that he would agree to an extension to file an answer only until January 18, 1991. The position of Plaintiffs’ counsel was confirmed by letter to Defendant’s counsel the same day, as follows:

Enclosed please find a copy of the Complaint filed in the above matter, as well as a copy of the signed return receipt indicating valid service on the defendant pursuant to Pa.R.C.P. 404(2) and 405(c). As we discussed on the phone this morning, I just received today your letter requesting an extension to answer. I am granting defendant an extension of two weeks after your receipt of the Complaint to file an Answer. Accordingly, this extension is until Friday, January 18, 1991.
Please note that the extension of time requested in your letter and by phone was only to answer the Complaint, and that is the only extension I have granted.

Id., Exhibit B, R.R., page 46.

On January 11, 1991, thirty-eight days after receiving the Complaint and Notice to Defend, counsel for Defendant simultaneously filed his entry of appearance, preliminary objections to the Complaint in the form of a petition to dismiss for lack of personal jurisdiction, and a notice pursuant to Local Rule 1028.1, requiring a responsive pleading to be filed within thirty days. On January 23, 1991, Plaintiffs filed their preliminary objections to the preliminary objections filed by Defendant. Plaintiffs averred that Defendant’s filing of objections (a) violated an alleged agreement between counsel that Defendant would waive the right to file any pleading other than an Answer to the Complaint in consideration for the Plaintiffs having granted an extension of time in which to respond and (b) were untimely. Attached to Plaintiffs’ objections were copies of the exchange of letters between counsel. Plaintiffs prayed that the preliminary objections of Defendant be stricken, pursuant to Pa.R.C.P. 1017(b)(2). The Plaintiffs’ preliminary objections were filed and served upon Defendant along with the same notice to plead over, pursuant to Local Rule 1028.1.

On February 21, 1991, Defendant filed its Response to Preliminary Objections of Plaintiff to Preliminary Objections of Defendant. Through its Response and its Memorandum of Law in Support thereof, Defendant admitted receiving the Complaint by certified mail in Colorado on December 4, 1991, admitted that the time for filing a response to the Complaint would have expired on December 24, 1990, admitted to the sending and receipt of the letters between counsel regarding an extension of time, but denied any agreement under which Defendant’s right to file preliminary objections pertaining to jurisdiction had been waived. On February 25, 1991, an Affidavit in Support of Preliminary Objections was filed by Defendant. The affidavit purported to be that of one William Grove, the manager of the Cross Creek Condominiums located in Frisco, Colorado. It bore the acknowledgement of a notary public in Summit County, Colorado, under a single notarial seal.

With these pleadings before it, the trial court, on March 5, 1991, entered its order overruling Plaintiffs’ preliminary objections and granting Defendant’s preliminary objection in the form of a petition to dismiss for lack of personal jurisdiction. The trial court dismissed the complaint “with prejudice and with leave for plaintiffs to refile a complaint in an appropriate jurisdiction.” This was error.

We first consider the trial court’s disposition of Plaintiffs’ preliminary objections to the Defendant’s preliminary objections. A party has a right to file a preliminary objection raising any appropriate defenses or objections which that party might have to an adverse party’s preliminary objection. Pa.R.C.P. 1017(b)(2, 3), 1028(a); Farinacci v. Beaver County Industrial Development Authority, 510 Pa. 589, 593, 511 A.2d 757, 759 (1986); Clay v. Advanced Computer Applications, Inc., 370 Pa.Super. 497, 508-509, 536 A.2d 1375, 1381-82 (1988) rev’d in part 522 Pa. 86, 559 A.2d 917 (1989); 5 Standard Pennsylvania Practice 2d § 25:5; cf. Triage, Inc. v. Commonwealth, Dept. of Transportation, 113 Pa.Cmwlth. 348, 354, 537 A.2d 903, 907 (1988); GOODRICH-AMRAM 2d § 1017(b):12, 255-56 (1991). The trial court, therefore, was obliged to consider on the merits the Plaintiffs’ preliminary objections. Clay v. Advanced Computer Applications, Inc., 370 Pa.Super. at 509, 536 A.2d at 1382.

On the issue of whether the exchange of letters between counsel resulted in a written agreement for an extension of time, the trial court correctly ruled that a meeting of the minds was not reached. Our Supreme Court has pronounced the requirements for a binding written agreement for an extension of time:

The requirements, basically, are the same as for any writing which purports to be a contract: the parties must be known; the terms (here the time period involved) must be definite; and the writing must, when plainly construed, indicate an agreement or meeting of the minds on the terms. In addition, an agreement written in the context of statutory or regulatory application must be read in the context of the statute or rule. Finally, although the agreement need not be formal, as the comment [to Pa.R.C.P. 237.1] indicates, it does require at least “an exchange of letters.”

Johnson v. Southeastern Pennsylvania Transportation Authority, 524 Pa. 209, 214-215, 570 A.2d 71, 73-74 (1990) (footnotes omitted).

Here, Defendant’s counsel requested “an extension of time to answer the Complaint.” In reply, Plaintiffs’ counsel granted “an extension of two weeks ... to file an Answer.” Plaintiffs’ counsel construed his adversary’s prior letter as a request “only to answer the Complaint, and that is the only extension I have granted.” In their preliminary objections, and now on appeal, Plaintiffs attempt to argue that the exchange of letters resulted in an agreement for an extension of time “only to answer the [Plaintiffs’] Complaint in this matter.” We reject this contention.

If an issue of fact was raised by the preliminary objection regarding the alleged agreement and the response thereto, the court would have been required to take evidence by deposition or otherwise. Pa.R.C.P. 1028(c). Leahy v. Pa. Liquor Control Board, 122 Pa.Cmwlth. 251, 257, 551 A.2d 1153, 1156 (1988). After careful review of the pleadings in this case, we conclude that the trial court had sufficient information before it to ascertain whether an agreement was made between the parties. There is no dispute as to the contents of the letters which were exchanged. We would agree with Defendant’s contention in its filed Response to Preliminary Objections that “the request for extension of time was not limited to the filing of an Answer, but rather requested an extension to answer the Complaint which would include, where appropriate, an answer to preliminary objections.” Defendant’s Response, filed February 21, 1991, ¶ 6, page 3; R.R., page 49.

When we apply the criteria set forth in Johnson, supra, we conclude that no agreement was reached. At the very least, the language contained in Defendant’s request for extension of time is unacceptably ambiguous: it can either refer to the right to file an answer (responsive pleading to include preliminary objections), or it could refer to the limited right to file an Answer only. In any event, it is clear that counsel for the Plaintiffs only granted an extension of time in which to file an Answer and specifically refused to grant an extension for the filing of any other pleading. Clearly, mutuality of assent is lacking. Counsel for the defendant’s request for “an extension of time to answer the Complaint” was denied by counsel for Plaintiffs. Even though there was an exchange of letters, no agreement was reached. Johnson, 524 Pa. at 215, 570 A.2d at 74; Burkett v. Allstate Insurance Co., 368 Pa.Super. 600, 608-609, 534 A.2d 819, 824 (1987). Since no agreement was reached, Plaintiffs’ contention that Defendant waived his right to challenge personal jurisdiction on this basis must fail.

In the alternative, Plaintiffs contended that Defendant’s preliminary objections were not timely filed. The trial court determined that, absent a showing of prejudice, the failure to file a responsive pleading within twenty days, as required by Pa.R.C.P. 1026(a), does not require that the late pleading be stricken. We find no error of law in this finding.

It has long been the law that the rule requiring the filing of a responsive pleading within twenty days is not absolute. Our Supreme Court instructs us:

Pa.R.C.P. 1026 provides that a pleading shall be filed within 20 days after service of a preceding pleading. This rule is not mandatory but permissive. We have held that late pleadings may be filed “if the opposite party is not prejudiced and justice requires. Much must be left to the discretion of the lower court." Fisher v. Hill, 368 Pa. 53, 81 A.2d 860 (1951). (Emphasis added.)

Paulish v. Bakaitis, 442 Pa. 434, 441-42, 275 A.2d 318, 321-22 (1971). This court has recognized that it is within the sound discretion of the trial court to permit a late filing of a pleading where the opposing party will not be prejudiced and justice so requires. Boarts v. McCord, 354 Pa.Super. 96, 100-101, 511 A.2d 204, 207 (1986), Louis v. Clark, 227 Pa.Super. 547, 550, 323 A.2d 298, 299-300 (1974). Where possible, the rules of civil procedure, including filing rules, should be liberally construed in order to effect equitable results. Pa.R.C.P. 126, Boarts v. McCord, 354 Pa.Super. at 101, 511 A.2d at 207.

In the present case, Defendant’s preliminary objections were filed during the period for which an extension had been granted, albeit for other purposes, by Plaintiffs. They were filed within nine days of the receipt of a copy of the Complaint by defense counsel from Plaintiffs’ counsel. The objections were the exclusive means by which to raise the question of personal jurisdiction and Defendant’s failure to so raise the question would have constituted a waiver of that defense. Pa.R.C.P. 1017(b)(1), 1028(b), 1032; Tops Apparel Manufacturing Company v. Rothman, 430 Pa. 583, 585, 244 A.2d 436, 437-38 (1968); Monaco v. Montgomery Cab. Co., 417 Pa. 135, 208 A.2d 252 (1965); Roskwitalski v. Reiss, 338 Pa.Super. 85, 94, 487 A.2d 864, 868 (1985) appeal denied 514 Pa. 619, 521 A.2d 933 (1987); GOODRICH-AMRAM 2d § 1032:2, page 138 (1991).

There are no averments in Plaintiffs’ Preliminary Objections to the Preliminary Objections filed by Defendant to suggest that Plaintiffs were prejudiced in any way by the late filing on January 11, 1991. The thrust of Plaintiffs’ position both in the trial court and on appeal has been the existence of the written agreement for a limited extension of time and not the untimeliness of the filing. The prejudice necessary to support Plaintiffs’ contention must be such prejudice as flows from the fact that the allegations are offered late rather than on time, and not such prejudice as results from the fact that the opponent may lose the case on the merits if the pleading is allowed. Bata v. Central Penn National Bank of Philadelphia, 448 Pa. 355, 380, 293 A.2d 343, 357 (1972); Joyce v. Safeguard Mutual Assurance Co., 362 Pa.Super. 522, 527 n. 2, 524 A.2d 1362, 1364 n. 2 (1987).

In the case now before us, the trial court did not abuse its discretion in refusing to strike Defendant’s preliminary objections, based on their untimely filing. The delay was brief and Plaintiffs had not acted to take a default judgment. Plaintiffs have not even suggested that they were prejudiced in any way by the brief delay in filing Defendant’s responsive pleading. The trial court could, within its discretion, properly refuse to strike the preliminary objections of Defendant. Allison v. Merris, 342 Pa.Super. 571, 574-75, 493 A.2d 738, 740 (1985).

We turn now to review that portion of the trial court’s order which sustained Defendant’s preliminary objections in the form of a petition to dismiss for lack of personal jurisdiction. In examining the trial court’s decision to sustain the objection to jurisdiction, we are guided by the following scope of review:

[W]hen preliminary objections, if sustained, would result in the dismissal of an action, such objections should be sustained only in cases which are clear and free from doubt____ Moreover, when deciding a motion to dismiss for lack of personal jurisdiction the court must consider the evidence in the light most favorable to the non-moving party, [citations omitted].

Barber v. Pittsburgh Corning Corp., 317 Pa.Super. 285, 302-03, 464 A.2d 323, 332 (1983), cert. denied 467 U.S. 1205, 104 S.Ct. 2387, 81 L.Ed.2d 346 (1984), cited in Kenneth H. Oaks, Ltd. v. Josephson, 390 Pa.Super. 103, 105, 568 A.2d 215, 216 (1989), followed in Garzone v. Kelly, 406 Pa.Super. 176, 593 A.2d 1292, 1296 (1991).

We have previously concluded that the trial court had sufficient information before it to resolve the issue concerning a written agreement for an extension of time without the need to take evidence by deposition or otherwise. We reach a contrary conclusion on the issue of whether personal jurisdiction was lacking. We are particularly guided by the rules laid down by this Court in Holt Hauling and Warehousing Systems, Inc. v. Aronow Roofing Co., 309 Pa.Super. 158, 161-162, 454 A.2d 1131, 1133 (1983):

Where a defendant wishes to challenge the court’s exercise of in personam jurisdiction, he may do so by filing preliminary objections____ Pa.R.C.P. 1017(b)(1). If an issue of fact is raised by the preliminary objections, “the court shall take evidence by depositions or otherwise.” Pa.R.C.P. 1028(c). In such a situation the court should not reach a determination based upon its view of the controverted facts, but must “resolve the dispute by receiving evidence thereon through interrogatories, depositions or an evidentiary hearing.” ... The failure of the parties to provide the evidence necessary for a proper determination of the issue does not excuse the court from further inquiry. Thus, it was incumbent on the court below to take evidence to resolve the dispute____ Moreover, it was not [Plaintiff] but [Defendant] who, as the moving party, bore the burden of supporting its objections to the court’s jurisdiction, [citations omitted].

Here, when Plaintiffs filed their preliminary objections to Defendant’s preliminary objections, they included an averment that “Defendant’s Preliminary Objections also are completely lacking in factual support through affidavits or other competent evidence, and must be denied for that reason alone.” Plaintiffs’ Preliminary Objections filed January 23, 1991, page 3, II 9; R.R., page 33. A month later, Defendant filed its Affidavit in Support of Preliminary Objections of Defendant. R.R., pages 57-58. Defendant alleged that it does not (1) maintain an office within the Commonwealth of Pennsylvania, (2) advertise in newspapers of general circulation within the Commonwealth, nor (3) engage or transact business in the Commonwealth on any regular or continuous basis. Defendant further averred that it advertises only in one major publication, Ski Magazine, which Defendant alleged is distributed on a national basis but is not targeted specifically to Pennsylvania residents. Id.

The affidavit was the only evidence before the trial court prior to its ruling now on appeal. No opportunity was afforded Plaintiffs to respond on the merits to the Preliminary Objections of the Defendant or to the affidavit alleging no minimal contacts within the state. This was error. The trial court correctly overruled the preliminary objections filed by Plaintiffs. However, having done so, it failed to afford Plaintiffs any opportunity to respond to the Preliminary Objections of the Defendant.

Pa.R.C.P. 1028(d) provides:

Rule 1028. Preliminary Objections
(d) If the preliminary objections are overruled, the objecting party shall have the right to plead over within twenty (20) days after notice of the order or within such other time as the court shall fix.

This court has found the right to plead over when preliminary objections are dismissed to be absolute. International Lands, Inc. v. Fineman, 285 Pa.Super. 548, 550, 428 A.2d 181, 182 (1981), cited in Delaware County Solid Waste Authority v. Earl Tp., Bucks County, 112 Pa. Cmwlth. 76, 81, 535 A.2d 225, 227 (1987); GOODRICHAMRAM 2d § 1028(d):l, pages 57-58 (1991). The trial court’s granting of final relief to Defendant in the form of dismissal of the Complaint with prejudice while denying Plaintiffs the right to answer and without expressly finding any facts on which to base its order was an action in excess of the trial court’s powers. Earl Tp., Bucks County, supra.

There is some authority for the use of affidavits to resolve preliminary objections raising questions of jurisdiction rather than through interrogatories, depositions or an evidentiary hearing. Slota v. Moorings, Ltd., 343 Pa.Super. 96, 100-101, 494 A.2d 1, 2-3 (1985). Submission of evidence by affidavit is not a recommended procedure but was approved in Slota on the basis that the facts attested to in the affidavit before that court were both clear and specific. Moreover, at least one of the plaintiffs in that case had been deposed, and the statements of the deponent were found to be nothing more than rumor, surmise and conjecture. Id. We find Slota to be distinguished from the case now before us. Having properly filed preliminary objections to Defendant’s preliminary objections, Plaintiffs had every right to expect that they would be afforded an opportunity to respond to the jurisdictional issue, in the event their objections based on timeliness and waiver were not sustained. Rule 1028(d).

Because Plaintiffs retain their right to file a responsive pleading on the merits to Defendant’s preliminary objections, it is unnecessary for this court to review the reasons given by the trial court for dismissing the Complaint. International Lands, Inc., supra. The question of jurisdiction has been controverted. The trial court is required, therefore, to resolve the dispute by receiving evidence thereon through interrogatories, depositions or an evidentiary hearing. Pa.R.C.P. 1028(c); Luitweiler v. Northchester Corp., 456 Pa. 530, 535, 319 A.2d 899, 902 (1974); Holt Hauling and Warehousing Systems, Inc., supra.

We do not decide whether Defendant, Cross Creek Condominiums, is subject to the jurisdiction of our courts. That is a matter for determination by the trial court. We do hold that a party enjoys an absolute right to plead over and must be afforded an appropriate period of time within which to file a responsive pleading, upon the dismissal of that party’s preliminary objections to preliminary objections. Holt Hauling and Warehousing Systems, Inc., supra; International Lands, Inc. v. Fineman, supra.

The order sustaining and granting Defendant’s Preliminary Objection in the form of a petition to dismiss for lack of personal jurisdiction and dismissing the Complaint with prejudice is REVERSED. The case is REMANDED for the entry of an order granting Plaintiffs an appropriate period within which to file a responsive pleading to Defendant’s Preliminary Objections filed January 11, 1991 and its Affidavit filed February 25, 1991. Jurisdiction relinquished.

WIEAND, J., files a concurring statement.

WIEAND, Judge,

concurring:

I join the majority’s decision to remand for the purpose of allowing plaintiffs to file a responsive pleading to defendant’s preliminary objections raising a question of jurisdiction. I write separately to observe that this right to file a responsive pleading to preliminary objections exists only where the preliminary objections aver facts and where said preliminary objections have been duly endorsed with a notice to plead. Where preliminary objections averring facts are not endorsed with a notice to plead, the facts averred in the preliminary objections are deemed denied. See: Pa.R.C.P. 1026(a). In such cases, it becomes the burden of the objector to prove the alleged facts via depositions or evidentiary hearing.


author: DEL SOLE, Judge: JOHNSON, Judge,

text:
    602 A.2d 871
    Reginald DOWNING and Billie Jean Downing, his Wife and Guardian, Appellee, v. HARLEYSVILLE INSURANCE COMPANY, Appellant.
    Superior Court of Pennsylvania.
    Argued Sept. 12, 1991.
    Filed Feb. 4, 1992.

      William H. Pugh, IV, Norristown, for appellant.
    Phillip H. Baer, Philadelphia, for appellee.
    Before WIEAND, McEWEN, OLSZEWSKI, DEL SOLE, BECK, TAMILIA, POPOVICH, JOHNSON and HUDOCK, JJ.
   DEL SOLE, Judge:

Harleysville Insurance Company, [Harleysville] appeals from an award of Summary Judgment entered in favor of Plaintiff-Appellees, Mr. and Mrs. Downing, in the amount of $90,000 plus interest. Harleysville challenges this award on the basis that it is premised on an improper conclusion that Mr. Downing was an “occupant” of the Harleysville vehicle and further that this award would wrongly allow the Downings to receive multiple coverage for first party benefits against two carriers of equal priority. Because this second issue called into question a review of the decision reached in Manolakis v. Transamerica Insurance Company, 396 Pa.Super. 256, 578 A.2d 503 (1990), alloc, granted, 526 Pa. 637, 584 A.2d 319 (1991), the parties were asked to argue the case before this en banc panel. Following argument and review of the record presented, we conclude that the trial court did err in determining that Mr. Downing was an occupant of the Harleysville vehicle. We, nevertheless, find that the Downings were properly awarded first party benefits against Harleysville under 75 Pa.C.S.A. § 1713(a)(4). Because we further hold that no other carrier involved in this matter was at the same or higher priority level as Harleysville, a discussion of the Manolakis decision is rendered unnecessary.

We begin our discussion with a brief recitation of the underlying facts. Mr. Downing, who neither owned a car nor lived with any relative who owned a car, was traveling as a passenger in a vehicle operated by Gerald W. Hartley which was insured by the Prudential Insurance Company [Prudential]. While proceeding on their journey, Mr. Hartley and Mr. Downing noticed a vehicle disabled by a flat tire and they stopped to render assistance. The disabled vehicle was insured by Harleysville. Mr. Downing offered to change the tire on behalf of the operator of the disabled vehicle. While standing next to the side of the disabled vehicle holding the jack to change the tire, the vehicle and Mr. Downing were struck by a third vehicle operated by an uninsured motorist who was driving under the influence of alcohol. Mr. Downing suffered serious injuries causing him to remain in a comatose state since the accident and resulting in the amputation of his right leg. His medical expenses have been substantially in excess of $100,000.

In 1986 Mr. Downing and his wife and guardian, Billie Jean Downing, commenced a civil action against both Prudential and Harleysville for first party benefits. Prudential subsequently paid the Downings the maximum amount of its coverage, $10,000, plus interest and counsel fees and was dismissed from the action. (The Stipulation of Dismissal signed by the parties indicates the amount to be $9,300.) The Downings then filed a motion for Summary Judgment against Harleysville, which answered and filed a cross motion for Summary Judgment. The court granted the Downings’ motion. Since the maximum coverage under the Harleysville policy was $100,000 and since the Downings already recovered $10,000 from Prudential, the court entered a Judgment for $90,000 representing the balance of the coverage available. The trial court reasoned that under the Pennsylvania Motor Vehicle Financial Responsibility Law, 75 Pa.C.S.A. § 1701 et seq., Mr. Downing was an “occupant” of both the Prudential vehicle in which he was traveling as a passenger and the disabled Harleysville vehicle to which he was providing assistance when the accident occurred. Based upon this finding the court ruled that the Downings were entitled to recover from both carriers who were at the same priority level. In reaching this conclusion the court rejected Harleysville’s position that the court was permitting the “stacking” of coverage.

The provisions of the MVFRL address the sources of recovery and their respective priority levels in § 1713. In determining Mr. Downing’s relationship with the motor vehicles involved and the insurers, it is necessary to detail its provisions.

§ 1713. Source of benefits
(a) General rule. — Except as provided in section 1714 (relating to ineligible claimants), a person who suffers injury arising out of the maintenance or use of a motor vehicle shall recover first party benefits against applicable insurance coverage in the following order of priority:
(1) For a named insured, the policy on which he is the named insured.
(2) For an insured, the policy covering the insured.
(3) For the occupants of an insured motor vehicle, the policy on that motor vehicle.
(4) For a person who is not the occupant of a motor vehicle, the policy on any motor vehicle involved in the accident. For the purpose of this paragraph, a parked and unoccupied motor vehicle is not a motor vehicle involved in an accident unless it was parked so as to cause unreasonable risk of injury.

75 Pa.C.S.A. § 1713

As stated, the trial court, when ruling on the Summary Judgment motion, determined that Mr. Downing was an “occupant” of both the Prudential vehicle and the Harleysville vehicle under § 1713(a)(3). We conclude that he could not be classified as an “occupant” of either vehicle; rather, the Downings may recover against Harleysville under § 1713(a)(4) because their injuries arose from “the maintenance or use” of the disabled Harleysville vehicle which was “involved in the accident.”

Recovery under each of the priority levels outlined in § 1713 is premised on the occurrence of an injury which arises out of the “maintenance or use of a motor vehicle.” See 75 Pa.C.S.A. § 1711, § 1712 and § 1713(a). For the injury to “arise” from such use it is further well established that there must be some causal connection between the motor vehicle and the injury before the motor vehicle insurer is required to pay first party benefits. Id.

The scope of the term “occupant” was first addressed in Tyler v. Insurance Company of North America, 311 Pa.Super. 25, 29, 457 A.2d 95, 96 (1983) under Section 204 of the No-Fault Act, 40 P.S. § 1009.204 (repealed.) Therein the court was considering whether a person who had alighted from a vehicle remained an occupant of that vehicle. The court concluded:

He continues to “occupy” the motor vehicle until he severs all connection with it. That point of severance is reached when he becomes highway oriented as opposed to being vehicle oriented. Until then, the alighting passenger continues to be an occupant of the [vehicle]. Until such a person is on his or her own without reference to the [vehicle], the person has not ceased to be a passenger or occupant.

Id., 311 Pa.Superior Ct. at 31, 457 A.2d at 97.

Our supreme court subsequently in Utica Mutual Insurance Co. v. Contrisciane, 504 Pa. 328, 473 A.2d 1005 (1984) examined the term “occupying” in determining whether an individual who had alighted from a vehicle continued to occupy it. The individual in that case had been involved in a minor motor vehicle accident and, as a result, was standing approximately ninety-seven (97) feet from his vehicle giving information to a police officer when he was struck and killed by an uninsured motorist. The estate of the individual who was killed sought to establish that he continued to “occupy” the vehicle which he was operating prior to the accident. The policy in question defined the “occupying” to mean “in or upon or entering into or alighting from.” In reaching the conclusion that the estate was entitled to recovery since the deceased party would be considered to be “occupying” the vehicle at the time of the accident, the court set forth the following criteria, which it found were met:

(1) there is a causal relation or connection between the injury and the use of the insured vehicle;
(2) the person asserting coverage must be in a reasonably close geographic proximity to the insured vehicle, although the person need not be actually touching it;
(3) the person must be vehicle oriented rather than highway or sidewalk oriented at the time; and
(4) the person must also be engaged in a transaction essential to the use of the vehicle at the time.

Id., 504 Pa. at 335, 473 A.2d at 1009.

Guided by these principles, we conclude that Mr. Downing had not remained an “occupant” of the Prudential vehicle in which he was traveling as a passenger prior to the accident.

Mr. Downing’s continued relationship with the Prudential vehicle is strikingly similar to the situation which existed between an injured party and a Cadillac automobile in Aetna Cas. & Sur. Co. v. Kemper Ins. Co., 657 F.Supp. 213 (E.D.Pa.1987). Therein an individual named Kendricks was a passenger in a Cadillac automobile insured by Aetna Casualty and Surety Company. The driver of the Cadillac, Smith, stopped along side the road to help a friend whose pick-up truck had become disabled. While Smith looked under the hood of the pick-up and Kendricks stood nearby, both were injured when a tractor-trailer hit the rear of the truck. In considering Pennsylvania No-Fault Act and its provisions relating to priority payments, the court had to determine whether Kendricks remained an “occupant” of the Cadillac at the time of the accident such that Aetna would be responsible for payment of his claims. The court examined the four criteria set forth in Contrisciane, supra, and stated:

Smith and Kendricks became “highway-oriented” when they left the Cadillac for the purpose of helping Perry with his pick-up truck. Moreover, their actions were not essential to the use of the Cadillac. Unlike the situation in Contrisciane, where the person had to go to the police car before he could continue using his car, the actions of Smith and Kendricks were completely unrelated to the continued use of the Cadillac.

657 F.Supp. at 215.

The court concluded that neither Kendricks nor Smith were “occupants” of the Cadillac at the time of the accident.

We find the rationale expressed in the Aetna decision particularly pertinent. Mr. Downing’s relation to the Prudential vehicle, which he had exited at the time of the accident to come to the aid of a disabled vehicle, was not as an “occupant.” The relationship between Mr. Downing and the Prudential vehicle fails to meet at least three of the four criteria espoused in Contrisciane. Mr. Downing’s injuries were not causally connected to the use of the Prudential vehicle, rather they occurred when he was struck by some third party while aiding another motorist with her disabled vehicle. Likewise, Mr. Downing was not oriented to the Prudential vehicle at the time of the accident. We adopt the conclusion reached in Aetna and find that Mr. Downing “became ‘highway-oriented’ when he left the [Prudential vehicle] for the purpose of helping [the stranded motorist] with [her] [disabled vehicle].” Id. Finally, Mr. Downing was not engaging in a transaction essential to the use of the Prudential vehicle at the time of the accident. In fact, Mr. Downing’s actions prior to the accident did not in any manner involve the Prudential vehicle. For these reasons we conclude that Mr. Downing was not an “occupant” of the the vehicle insured by Prudential at the time of the accident.

From the facts of this case, we also rule that Prudential was not responsible to the Downings under subsection (4) of § 1713(a). This subsection concerns a person who suffers injury arising out of the maintenance or use of a motor vehicle which is involved in an accident but who was not an “occupant” of the motor vehicle. Subsection (4) defines a “parked and unoccupied motor vehicle” as one involved in an accident only if it was parked “so as to cause unreasonable risk of injury.” 75 Pa.C.S.A. § 1713(a)(4). The facts clearly show that the Prudential vehicle was not “involved” in the accident. Further, there is nothing in the record, nor do any parties suggest, that the Prudential vehicle was parked “so as to cause an unreasonable risk of injury.” Thus, under the terms of the MVFRL, Prudential was not responsible for the payment of benefits to the Downings.

We turn now to an examination of Harleysville’s responsibilities to the Downings. The trial court found that Mr. Downing was in the status of an “occupant” of the disabled vehicle at the time of the accident. In reaching this conclusion the court examined the four criteria set forth in Contriscaine and found that they each had been met. It reasoned that since there was a causal relation between the injuries and the use of the disabled vehicle, since Mr. Downing was reasonably close to the disabled vehicle at the time he was injured, and since he was oriented to the vehicle and was engaged in a transaction which can be said to be essential to the use of the vehicle (changing a flat tire), Mr. Downing was “occupying” the disabled vehicle at the time of the accident. The trial court’s conclusion must fail because it ignores a prerequisite to the application of the four criteria announced in Contrisciane.

In defining the term “occupant” in Contrisciane and its predecessor Tyler, supra., the courts were considering whether a person who had alighted from a vehicle remained an occupant of that vehicle. In such a situation Contrisciane directs that the four criteria it sets forth are to be utilized to determine whether the injured party should be entitled to recover as an “occupant” of the vehicle. In both Tyler and Contrisciane the injured party had been traveling in the vehicle prior to the accident and the court was considering the injured parties’ continued relationship with that vehicle. The Contrisciane criteria were also utilized to determine if the injured party continued to hold the status of “occupant” in Shultz v. Nationwide Insurance Company, 373 Pa.Super. 429, 541 A.2d 391 (1988) (where a woman, who had been traveling in a vehicle which ran out of gasoline and who was putting gasoline into her vehicle, was injured when a passing car struck the vehicle behind her vehicle causing her to be pinned between the two); and McGilley v. Chubb & Son, Inc., 369 Pa.Super. 547, 535 A.2d 1070 (1987), (where a taxi driver who had exited his vehicle to “bum” a cigarette from another taxi driver was struck by a passing bus.)

In this case, Mr. Downing had not alighted from the disabled vehicle; he had never been inside the disabled car and there is nothing to indicate that he ever even intended to enter the disabled car. Mr. Downing’s relationship with the disabled vehicle here is identical to Kendricks’ relationship to the disabled pick-up truck in Aetna, supra. Therein, any claim that Kendricks was an occupant of the pick-up truck at the time of the accident was summarily dismissed. The court simply stated, “Clearly, this argument has no merit.” We likewise find no merit to the position that Mr. Downing was an occupant of the disabled vehicle which he was aiding at the time of the accident.

Although Mr. Downing cannot be considered to have been in the status of an “occupant” at the time of the accident, we nevertheless find Harleysville, as the insurer of a vehicle involved in the accident, to be responsible for the payment of first party benefits under 75 Pa.C.S.A. § 1713(a)(4).

Section 1713(a)(4) refers to coverage “for a person who is not the occupant of a motor vehicle” regarding first party benefits to be paid by an insurer which has provided a “policy on any motor vehicle involved in the accident.” In construing these same terms under the No-Fault Act “the court has said, ‘subparagraph (4) should be interpreted as written, and to apply to an uninsured claimant who was not an occupant of a car; namely, a pedestrian or bystander.’ ” Shultz v. Nationwide Ins. Co., supra 373 Pa.Super. at 434, 541 A.2d at 393 citing Schimmelbusch v. Royal-Globe Ins. Co., 247 Pa.Super. 28, 371 A.2d 1021 (1977). Subparagraph (4) sets forth one exception and dictates that a “parked and unoccupied” motor vehicle is not one “involved in an accident unless it was parked so as to cause unreasonable risk of injury.” 75 Pa.C.S.A. § 1713(a)(4).

We conclude, in this case, that the disabled vehicle was not a “parked vehicle” so the exception and a determination as to the manner in which it was “parked” is irrelevant and unnecessary. Aetna Cas. & Sur. Co. v. Kemper, supra, 657 F.Supp. at 214 ftn. 1. We further conclude that the disabled vehicle was clearly a vehicle “involved in the accident.” Mr. Downing was standing next to the disabled vehicle holding an instrument to change the tire of the vehicle when a passing car struck both the vehicle and Mr. Downing. Thus, Harleysville was responsible for the payment of first party benefits to the Downings under the provisions of 75 Pa.C.S.A. § 1713(a)(4).

Although subsection (a)(4), which we find applicable to Harleysville, is the last in the order of priority to provide a source of benefits, because we have also determined that Prudential was not at the same or higher priority level as Harleysville under 75 Pa.C.S.A. § 1713, questions concerning the “stacking” or receipt of multiple benefits are irrelevant to this matter and will not be discussed. The trial court’s award of Summary Judgment in favor of the Downings and against Harleysville is affirmed based upon Harleysville’s responsibility under § 1713(a)(4).

JOHNSON, J., files a concurring opinion in which TAMILIA, J., joins.

JOHNSON, Judge,

concurring:

I concur in my colleagues’ conclusion that the trial court properly granted Summary Judgment in favor of Mr. and Mrs. Downing. I am not able to conclude, however, as does the majority, that no other carrier was at the same priority level under 75 Pa.C.S. § 1713(a) as Harleysville. Rather, in my view, the stipulated facts lead only to the conclusion that Prudential could not have had a higher priority level under § 1713(a) than Prudential. Because I do not consider Manolakis v. Transamerica Insurance Company, 396 Pa.Super. 256, 578 A.2d 503 (1990), alloc. granted, 526 Pa. 637, 584 A.2d 319 (1991) to be controlling under the facts before us, I would hold that the Downings were entitled to coverage by Harleysville despite having exhausted the limits of the coverage provided by Prudential. Accordingly, I concur only in the majority’s result.

Under the stipulated facts of this case, I agree with the majority’s conclusions that Downing cannot be considered to be an “occupant” of the Harleysville vehicle, and that Harleysville falls within the fourth level of § 1713(a). I also agree that Prudential is not an insurer at the third level of priority within § 1713(a) because Downing cannot be considered to be an “occupant” of the Prudential vehicle once he left that vehicle to undertake business unrelated to its use and maintenance.

I am unable to conclude from the stipulated facts, however, that the Prudential vehicle was not within the priority level defined by § 1713(a)(4). Gerald Hartley testified in his deposition that, following the accident, Downing was found underneath the Prudential vehicle. Counsel for both parties stipulated to the accuracy of this testimony. Nothing in the record leads me to conclude that Downing did not strike the Prudential vehicle, thereby involving it in the accident; consequently, I am unable to join the majority’s holding that that Prudential vehicle was not “involved in the accident” so as to place Prudential within § 1713(a)(4). Instead, I consider whether the recovery Downing seeks is allowable regardless of whether Prudential, having paid the limits of its liability, was within § 1713(a)(4). For the reasons which follow, I conclude that such recovery was not precluded.

First party benefits may not be increased by stacking the limits of coverage of multiple motor vehicle policies covering an individual for the same loss. 75 Pa.C.S. § 1717(2). In Laguna v. Erie Insurance Group, 370 Pa.Super. 308, 536 A.2d 419 (1988), a panel of this court held that § 1717(2) precludes recovery of first-party benefits from an insurer once first-party benefits have been paid by an insurer of a higher priority under § 1713.

In Manolakis, a claimant sought first-party medical benefits from Transamerica Insurance Company, which denied the claim because Allstate Insurance Company, an insurer at the same level of priority under § 1713, had already paid the limits of its coverage. Transamerica contended that payment of additional benefits would constitute stacking, which was prohibited under § 1717(2). Allstate had paid the claimant its policy limits of $10,000 in medical coverage and $50,000 in income loss coverage. Manolakis sought further recovery of medical expenses under the Transamerica policy which provided coverage for $100,000 for medical expenses and $15,000 for loss of income. The Manolakis court held that recovery of the medical benefits sought would constitute stacking and was thus prohibited by § 1717(2).

I do not, however, find Manolakis controlling because the claimant there sought total benefits in excess of the coverage provided by either policy. Here, the Prudential policy provided a $10,000 limit for recovery of first-party benefits, which Downing recovered. The Harleysville policy limits first-party benefits to $100,000; however, Downing sought only $90,000 in first-party benefits. Therefore, the total recovery sought by Downing is within the limits of one of the applicable policies. I would affirm the order of the. trial court because I do not perceive such a recovery to constitute stacking.

Moreover, the Legislature has provided for recovery from multiple carriers within § 1713(b), which states:

(b) Multiple sources of equal priority. — The insurer against whom a claim is asserted first under the priorities set forth in subsection (a) shall process and pay the claim as if wholly responsible. The insurer is thereafter entitled to recover contribution pro rata from any other insurer for the benefits paid and the costs of processing the claim. If contribution is sought among insurers responsible under subsection (a)(4), proration shall be based on the number of involved motor vehicles.

Accordingly, I conclude that the trial court has properly granted Downing’s motion for summary judgment, and I concur in the majority’s result.

TAMILIA, J., joins.

      . We note that Prudential is not a party to this appeal and that the Downings have not challenged the amount of their award against Harleysville.


author: WIEAND, Judge: CIRILLO, Judge,

text:
    602 A.2d 877
    CLEARFIELD VOLUNTEER FIRE DEPARTMENT, Fair and Park Board and the Clearfield Foundation v. BP OIL, INC. (formerly Boron Oil Company) and Shawville Coal Company, Inc. Appeal of SHAWVILLE COAL COMPANY, INC.
    Superior Court of Pennsylvania.
    Argued Aug. 21, 1991.
    Filed Feb. 6, 1992.

      Paul D. Burke, Pittsburgh, for appellants.
    Carl A. Belin, Jr., Clearfield, for appellees.
    Before WIEAND, CIRILLO and JOHNSON, JJ.
   WIEAND, Judge:

In this action for declaratory judgment, the trial court entered an order terminating a coal lease for a portion of the demised premises. The trial court rejected the lessee’s contention that the lease had been for a single, undivided tract. Post-trial motions were dismissed, and this appeal followed. We reverse.

Pursuant to the terms of a written agreement of lease entered in 1956 between a predecessor of Clearfield Volunteer Fire Department, the present lessor, and Shawville Coal Co., the lessee, the coal company was granted the exclusive right and privilege to mine and remove all strip mineable, merchantable and profitable seams of coal until the coal was exhausted from a 256 acre tract of land in Lawrence Township, Clearfield County. The coal company was also given the right of ingress, egress and regress over, into and across the surface of the tract and the right to place thereon machinery, equipment and waste. In exchange, the coal company was required to pay the owner a minimum monthly royalty of fifty ($50) dollars. So long as this royalty is paid, the agreement provides, the lease cannot be cancelled because of a delay in coal production. At the time of entering the lease, State Route 879 passed through the tract. Later, Interstate Route 80 was constructed and also intersected the leased property. As a result, the tract was divided into a northern parcel and a southern parcel. The southern parcel is involved in the present dispute.

Clearfield Volunteer Fire Company filed an action for a judgment declaring that the lease had expired and was subject to termination with respect to the southern portion of the demised tract. The lease had expired, it was contended, because the coal remaining in the southern parcel could no longer be mined profitably. The trial court, after hearing the evidence, agreed that the coal which could profitably be mined had been exhausted and held, because the tract had been bisected by highway construction, that the coal company’s leasehold estate in the southern parcel should be terminated.

Our standard of review was stated in Federal Kemper Ins. Co. v. Neary, 366 Pa.Super. 135, 530 A.2d 929 (1987), as follows:

In reviewing a judgment entered in a declaratory judgment action, we are bound by the same narrow standard of review which exists in equity actions. Shaffer v. Flick, 360 Pa.Super. 192, 195-196, 520 A.2d 50, 51 (1987); Supp v. Erie Insurance Exchange, 330 Pa.Super. 542, 544, 479 A.2d 1037, 1038 (1984). A judgment of a trial court will not be reversed absent a clear abuse of discretion or error of law. Lombardo v. DeMarco, 350 Pa.Super. 490, 495, 504 A.2d 1256, 1258 (1985). The test is not whether we would have reached the same result on the evidence presented, but whether the trial court’s conclusion can reasonably be drawn from the evidence. Estate of Tippins, 487 Pa. 107, 112 n. 2, 408 A.2d 1377, 1380 n. 2 (1979); Lombardo v. DeMarco, supra, 350 Pa.Super. at 495, 504 A.2d at 1258; Hoffman v. Gekoski, 250 Pa.Super. 49, 52, 378 A.2d 447, 448 (1977). Where the trial court’s factual determinations are adequately supported by the evidence, we may not substitute our judgment for that of the trial court. Frowen v. Blank, 493 Pa. 137, 142, 425 A.2d 412, 415 (1981).

Id. 366 Pa.Super. at 139, 530 A.2d at 930-931. See also: State Farm Mut. Ins. Co. v. Judge, 405 Pa.Super. 376, 379, 592 A.2d 712, 713 (1991).

Here, we accept the trial court’s finding that the only coal remaining on the southern parcel cannot be mined profitably. Therefore, we must determine whether that portion of the leasehold estate can be terminated where coal continues to be mined profitably from the northern parcel and while the agreed rent continues to be paid.

In Hutchison v. Sunbeam Coal Corp., 513 Pa. 192, 519 A.2d 385 (1986), the Supreme Court observed:

A lease is a contract and is to be interpreted according to contract principles. Pugh v. Holmes, 486 Pa. 272, 284, 405 A.2d 897, 903 (1979). Determining the intention of the parties is a paramount consideration in the interpretation of any contract. Robert F. Felte, Inc. v. White, 451 Pa. 137, 143, 302 A.2d 347, 351 (1973); Unit Vending Corp. v. Lacas, 410 Pa. 614, 617, 190 A.2d 298, 300 (1963). The intent of the parties is to be ascertained from the document itself when the terms are clear and unambiguous. Steuart v. McChesney, 498 Pa. 45, 48-49, 444 A.2d 659, 661 (1982); In re Estate of Breyer, 475 Pa. 108, 115, 379 A.2d 1305, 1309 (1977).

Hutchison, supra, 513 Pa. at 200, 519 A.2d at 389-390. As a general rule, “[t]he law will not imply a different contract than that which the parties have expressly adopted.” Id., 513 Pa. at 198, 519 A.2d at 388.

In the instant case, the demised premises consist of an undivided tract of 256 acres. The lease contains no provision for subdividing the same into lesser tracts. Moreover, the right of the tenant to use the tract is not limited solely to the mining of coal. If a portion of the leasehold estate can no longer be utilized in connection with the direct mining of coal, it may nevertheless be used, as the parties expressly provided, for the storage of machinery, equipment and waste. Because the lease contemplated an estate in an undivided tract of 256 acres, we search in vain for language in the lease that would permit the lease to be terminated acre by acre as coal is removed.

Although conceding that it has been unable to find authority to support the trial court’s division of the tract into two smaller tracts, the lessor-appellee contends that this Court should affirm the trial court’s action by taking a practical approach rather than by strictly interpreting the agreement of the parties. By permitting a partial termination of the lease, it is argued, the trial court followed a policy which permits the “untrammeled development” of the land. Any other interpretation, it is argued, would be tantamount to creating a perpetual estate in the southern tract. We reject this argument.

There is no greater danger of creating a perpetual estate in the southern part of the leasehold than in any other part of the leased premises. The parties, by their agreement of lease, granted to the coal company a leasehold interest in the entire tract and expressly incorporated therein the circumstances under which the leasehold estate should come to an end. The profitable coal reserves have not been depleted, and the coal company continues to pay the royalty which it is required to pay in order to preserve its rights to use the land. Whatever period of time may be required to exhaust the coal, the terms of the lease make it abundantly clear that it was within the contemplation of the parties.

Appellee’s reliance upon decisions in Hutchison v. Sunbeam Coal Corp., supra, Hindman v. Farren, 353 Pa. 33, 44 A.2d 241 (1945), and Frenchak v. Sunbeam Coal Corp., 344 Pa.Super. 37, 495 A.2d 1385 (1985), criticized on other grounds by Hutchison v. Sunbeam Coal Corp., supra, is misplaced. These decisions provide guidance to courts which are called upon to interpret ambiguities in lease agreements. In such cases, it is sound policy to adopt an interpretation which does not impose on land undue restrictions tending to deprive the owner of the customary rights, privileges and incidents of ownership. In the instant case, however, the terms of the lease are not ambiguous. Indeed, neither party to the present litigation has argued that the intent of the parties failed to be expressed clearly in the written agreement. Where the terms of the lease are clear and free from doubt, it lies with the courts to enforce the agreement which the parties made. Here, the agreement provides for a leasehold estate in an undivided tract of 256 acres, which is not to be terminated unless and until coal can no longer be mined economically from the entire tract.

The lessor-appellee argues that the demised premises have in fact been divided by the construction of a highway and that to allow the lease to continue with respect to the southern parcel will render it unproductive and wasteful. It is clear, however, that the terms of the lease do not contemplate a partial termination. One again searches in vain for the trial court’s authority to alter the terms of the lease by removing therefrom a piece of the entire leasehold estate. In this respect it is revealing that the court, although willing to deprive the lessee of a portion of the leased premises, made no attempt to reduce the amount of rent or royalties which the lessee was required to pay for the remaining part of the leased real estate.

Finally, we do not share the concern of the lessor-appellee that a failure to order partial termination of the lease will result in an unproductive and wasteful piece of land. The terms of the lease recognize that the coal company’s operation may require the use of some of the land for the storage of machinery, equipment and waste. So long as the southern parcel is used as authorized by the terms of the lease, neither the lessor nor the court may interfere to terminate that portion of the leasehold estate merely because of a belief that it can be used more productively than it is presently being used.

We conclude, therefore, that the trial court’s decree had the effect of rewriting the agreement between the parties. By doing so, the court, arbitrarily and without authority, deprived appellant-lessee of the benefits of its bargain. This was error. The declaratory judgment entered by the trial court, therefore, must be reversed.

Judgment reversed.

CIRILLO, J., files a Dissenting Opinion.

CIRILLO, Judge,

dissenting:

The majority has failed to address the inequity of allowing land to stay unproductive in the hands of a lessee when there are profitable and beneficial uses available to the lessor. I must, therefore, respectfully dissent.

The majority decides that the trial court should not have regarded the southern parcel as a separate block of land because it paid consideration for the lease of the whole property, the use of the parcel for other purposes was an expressly stated benefit of the lease, and the lease did not contemplate subdivision of the land. I disagree. In Frenchak v. Sunbeam Coal Corp., 344 Pa.Super. 37, 44, 495 A.2d 1385, 1389 (1985), this court stated that “ ‘[i]t is against the policy of the law to unduly restrict the use of land so that the owner is deprived of the usual rights, privileges, and incidents of ownership and possession.’ ” Id, 344 Pa.Superior Ct. at 41, 495 A.2d at 1387.

I think this policy is applicable to the instant case. Were the lease not terminated the resultant non-use of the land would be wasteful and unproductive. If mining the southern tract is no longer economical or practical, allowing the coal mining lease to continue with respect to that parcel would severely circumscribe other profitable and beneficial uses of the land. Frenchak, supra. We must always be mindful that equity abhors a forfeiture. However, we must also consider that when a forfeiture does equity, as it would in this case, the interest in using the land productively outweighs the nonessential and inefficient uses of the tract. See Frenchak, 344 Pa.Super. at 43, 495 A.2d at 1389. Therefore, the trial court’s decision to treat the tracts separately was not, in my opinion, erroneous. Interstate 80, a limited access highway, effectively separated the two parcels, severely limiting the access between the two parcels. Furthermore, the record reveals that the two tracts had separate mining permits and were run as two separate operations. I would conclude, therefore, that the trial court did not abuse its discretion or commit an error of law in deciding that the original tract should be divided into two parcels. Federal Kemper Ins. Co. v. Neary, 366 Pa.Super. 135, 139, 530 A.2d 929, 930-31 (1987); Lombardo v. DeMarco, 350 Pa.Super. 490, 495, 504 A.2d 1256, 1258 (1985).

The majority also concludes that, where a lease provides for permissible uses such as constructing and operating roads for mining purposes, keeping machinery and other equipment on the land, hauling coal over the premises from other lands, and using the land as a coal yard, the lease should not terminate simply because the coal mining has ended. This discussion fails to recognize the present nature of the land in question. The parcel has been intersected by a limited access interstate highway. This highway impedes travel and access to the southern parcel and thus frustrates the benefit of the additional uses provided for in the lease.

Therefore, I would apply the general rule used to examine coal leases. A coal lease grants the lessee the right to remove the coal beneath the surface; however, when that coal supply is exhausted or unmerchantable, “all of the estate is consumed or reverts back to the owner of the surface.” United States Steel Corporation v. Commonwealth, Dept. of Environmental Resources, 17 Pa.Commw. 594, 333 A.2d 486, 488 (1975). The trial court found that the coal of merchantable quality and quantity from the parcel had been exhausted. Since the trial court determined that the lease, by its own terms, provided for termination upon the exhaustion of the coal, the trial court correctly terminated the lease. The other uses for the land that Shawville contends should require the lease to remain intact with respect to the southern parcel are all peripheral, secondary uses stemming from its right to mine coal. As stated earlier, the southern parcel is now a separate and distinct parcel of land. Permitting Shawville to retain the unprofitable southern tract while the coal in the northern parcel is mined would permit Shawville to hold the unused tract perpetually. See Hutchison, 513 Pa. at 202 n. 5, 519 A.2d at 390 n. 5 (“a lease will not be construed to create a perpetual term unless the intention is expressed in clear and unequivocal terms”).

After a complete review of the trial court’s decision, I find that the trial court committed no error of law or abuse of discretion and that its decision was supported by competent evidence. See Federal Kemper, supra; Lombardo, supra. Therefore, I must respectfully dissent.

      . Furthermore, denying Shawville the tangential uses of the southern tract should have no affect on its operations as Shawville worked the two tracts separately.