text:
    555 A.2d 123
    In the Interest of S.A.D., A Minor, Appeal of K.D., a Minor, Appellant, Monroe County Children & Youth.
    Superior Court of Pennsylvania.
    Argued Sept. 13, 1988.
    Filed Jan. 20, 1989.
    Reargument Denied March 9, 1989.

      Janet J. Siracus, Assistant Public Defender, Stroudsburg, for appellant.
    Mark L. Newman, Assistant Public Defender, Stroudsburg, for appellee.
    Before OLSZEWSKI, DEL SOLE and JOHNSON, JJ.
   JOHNSON, Judge:

In this dependency action, we consider for the first time the obligation of the Commonwealth to promote family stability and to preserve the family unit pursuant to Public Law 96-272, June 17, 1980, the Adoption Assistance and Child Welfare Act of 1980. Under this Act the state is entitled to matching funds when it complies with federal requirements to make reasonable efforts to maintain the family unit when it temporarily or permanently removes the child from the home. In our Commonwealth, the services required by the federal act are implemented through the Department of Public Welfare and the County Children and Youth Services. In the present case, Monroe County Children and Youth Services (CYS) had a greater concern with the protection of their funding than the implementation of their responsibility to stabilize and protect the family unit of this young mother and her child. With regard to participation in the federal program, we have stated: Paramount to compliance is the requirement of due process and an appropriate judicial determination that removal of a child from his home was required. 55 Pa.Code § 3130.71(a). Prior to removal is the requirement that the agency make reasonable effort to prevent removal. 62 P.S. 701 et seq.; 55 Pa.Code §§ 3130.11, 3130.13, 3130.35-.42. The federal and state law requires periodic court monitoring which is the role of the Juvenile Court, 42 Pa.C.S. § 6351, 55 Pa. Code § 3130.71, and it also involves case plans for services for the child, parents and foster parents (55 Pa.Code § 3130.67) to: (1) improve conditions in the home (§ 3130.-67(6)(7)(8); and (2) facilitate the child’s return home or plan for permanent placement (§ 3130.61-67).

Ultimately, the goal is to rehabilitate the family, reunite the child with his family or, after reasonable efforts over an appropriate period of time have failed, to terminate parental rights and free the child for adoption pursuant to the Adoption Act of 1980, Subchapter B, Involuntary Termination, 23 Pa.C.S. § 2511(a).

Fallaro v. Yeager, 364 Pa.Super. 408, 422, 528 A.2d 222, 229 (1987).

These requirements are not mere formalities:

[I]t is clearly apparent that with the enormous social and legal implications involved in a finding of dependency, this can only be accomplished through the proceedings in Juvenile Court pursuant to a dependency petition, which calls into play the full panoply of services, safeguards and goals provided by federal and state laws and resources.

Fallaro v. Yeager, 364 Pa.Super. at 422, 528 A.2d at 229 (1987).

Here, finding that the agency has neither made reasonable efforts to keep this family together nor presented evidence probative of dependency, we reverse and remand.

The facts of this case may be stated as follows: On January 21,1988, K.D., an eighteen year old unwed mother, went to the office of the Monroe County Children and Youth Services in Stroudsburg, Pennsylvania and requested assistance. Mother and her fourteen month old daughter, S., born November 25, 1986, had no money and no place to stay. Mother was advised that her only alternative was to “voluntarily” place her child in the custody of CYS until she could find a place to stay. She was told by the agency to “get herself together and find a place [to stay] and get some employment so she could have her daughter back.” (N.T. 2/16/88 at 10.)

The regulations promulgated under 55 Pa.Code § 3130.65 require that a voluntary agreement may only be effective for 30 days and must contain a statement that the parent has a right to be represented by legal counsel, has a right to refuse to place the child and must contain a statement that the parent has a right to visit the child, to be consulted with respect to all medical or educational decisions and that the parent has the right to the immediate return of the child upon request unless the court orders the legal custody of the child to be transferred to the agency. As CYS has neither attached a copy of the voluntary agreement, stated why it was not accessible, nor set forth the provisions, we need not consider the voluntary agreement. Pa.R.C.P. 1019(h); see Judges v. County of Washington, 120 Pa.Cmwlth. 283, 289, 548 A.2d 1306, 1309 (1988). In view of our disposition, we do not address the failure of CYS to attach a copy of the “voluntary” agreement to the dependency petition when the surrender of a fundamental constitutional right is at issue.

In early February, Mother requested the return of her child. This request was denied by the agency. On February 16, 1988, the date of the hearing, Mother had been continuously requesting the return of her child for two weeks, was employed, earning $3.60 per hour, and was residing with the family of a friend. The stated reason for CYS’s refusal to return the child was that Mother needed to find a place where she could “be on her own” and have “her own place to live”. (N.T. 2/16/88 at 11-12.) The sole testimony at the dependency hearing was that of a CYS caseworker who repeatedly testified that Mother should find a more suitable place to live but acknowledged that neither she nor any other caseworker had visited the home where Mother was then living. The caseworker acknowledged that it was obvious that Mother could not afford a place of her own based on her minimal earnings but insisted that Mother find a more suitable place to live. N.T. 2/16/88 at 15-16.

On the basis of this testimony, the trial court not only made an initial determination of dependency but also made a specific finding that reasonable efforts were made by Monroe County CYS to prevent the placement. Counsel for CYS had requested such a finding:

[F]or funding and State administrative reasons, we’re required to proceed and present petitions in matters of this type, and what we’re requesting is a standard type of disposition, which is a finding of dependency which protects our funding and provides for proper state funding. It provides for placement with the agency and review at any time by any interested party.

N.T. 2/16/88 at 4-5.

Mother filed-a Notice of Appeal on March 16, 1988. On March 9, 1988 the trial court had scheduled a hearing for March 23, 1988 on a petition for reconsideration. This was the same hearing date established in the order entered February 17, 1988. The trial court conducted its review hearing, as scheduled, on March 23, 1988. Nothing in the certified record to this Court indicates that Mother received actual notice of this hearing. At that hearing, at which Mother did not appear, a CYS caseworker testified that Mother had changed her residence three times. The caseworker further testified that Mother had failed to appear for scheduled visits with the child. The trial court then entered an order confirming the order of February 17,1988, and providing for court review at any time on motion of any interested party.

Mother maintains on appeal that CYS made no reasonable efforts to avoid the necessity of the child’s placement in foster care. She also contends that the initial determination of dependency made by the trial court was not supported by clear and convincing evidence. Mother asserts that no history of abuse or neglect was shown, nor was any evidence presented to show that the minor child had been deprived of proper care during the time she was in the custody of her mother. Mother insists that even if a child is adjudicated dependent she may nonetheless not be separated from her parent unless the separation is clearly necessary. In re Donna W., 284 Pa.Super. 338, 425 A.2d 1132 (1981). We agree.

The “clear necessity” standard is designed to ensure that family unity is “preserved whenever possible.” 42 Pa.C.S. § 6301(b)(1) and (3). The Juvenile Act defines a dependent child as one who is without proper parental care or control, subsistence, education as required by law, or other care or control necessary for his or her physical, mental, or emotional health or morals. 42 Pa.C.S. § 6302. Whether a child is considered to be lacking proper parental care or control, for purposes of determining whether a child is a “dependent child” within the meaning of 42 Pa.C.S. § 6302, encompasses two discrete questions. It must first be ascertained if the child is “at this moment without proper parental care or control.” If so, the court must then determine if such care or control is immediately available. Matter of Yeager, 309 Pa.Super. 491, 495, 455 A.2d 717, 719 (1983); In the Interest of Anita H., 351 Pa.Super. 342, 346, 505 A.2d 1014, 1015 (1986).

The attorney for the minor child asserts that CYS failed to offer evidence probative of either question. He further argues that in this case there was no evidence before the trial court that separation of this mother from her child should have been considered in the first place. He correctly maintains that separation of a child from a parent, even if the child is adjudicated dependent, is improper absent a showing that the separation is clearly necessary. Clear necessity is established when the court determines that alternatives to separation are unfeasible. In the Interest of Ryan Michael C., 294 Pa.Super. 417, 421, 440 A.2d 535, 536 (1982).

Counsel for the minor child urges that we vacate the trial court order and return his client to her mother. Quoting respectively from Stanley v. Illinois, 405 U.S. 645, 651, 92 S.Ct. 1208, 1212, 31 L.Ed.2d 551 (1972) and Smith v. Organization of Foster Families for Equality and Reform, 431 U.S. 816, 844, 97 S.Ct. 2094, 2110, 53 L.Ed.2d 14 (1977), he also forcefully reminds us that we are not only concerned with the Fourteenth Amendment interest that a parent has in the “companionship, care, custody and management of his or her children” but also with the often forgotten interest of the child in not being dislocated from the “emotional attachments which derive from the intimacy of daily association with the parent.” Counsel for the minor child also raises a matter of public policy. He asks whether the decision of the trial court sends a dangerous message to young parents, who find themselves in temporary dire straits. The message being delivered, he suggests, is “Do not seek temporary assistance from Children and Youth Services. You will have trouble getting your child back.”

The evidence supporting the finding of reasonable efforts consisted entirely of the following testimony by the case worker:

Q. What assistance has been provided?
A. Well, housing of her child, getting [Mother] hooked up with Community Services, providing her bus pass and things so she can come visit with her child, getting her hooked up with the Salvation Army, which in turn put her up in a motel for a short time.
We have been working with her and encouraging her to get out to D.P.A., get on assistance, seek employment, and encouraging her to find her own place to live.

N.T. 2/16/88 at 10. The reasonable efforts requirement of the adoption Assistance *nd Child Welfare Act of 1980, PL 96-272 is twofold. First, states must include in their Title IV-E state plan a commitment that reasonable efforts will be made to prevent unnecessary placement of children in foster homes, and to return foster children to their homes. The relevant state plan requirement provides:

§ 671(a) In order for a State to be eligible for payments under this part, it shall have a plan approved by the Secretary which ...
(15) effective October 1, 1983, provides that, in each case, reasonable efforts will be made (A) prior to the placement of a child in foster care, to prevent or eliminate the need for removal of a child from his home, and (B) to make it possible for the child to return to his home.

42 U.S.C. § 671(a)(15) (1986). Second, for each child entering placement after October 1, 1983, there must be a judicial determination that reasonable efforts were made to prevent removal in order for the state to be eligible for federal foster care funds under Title IY-E. The state will be eligible only if:

The removal of the child from the home was the result of a judicial determination to the effect that ... reasonable efforts of the type described in section 671(a)(15) have been made.

42 U.S.C. § 672 (1986).

With the adoption of this legislation in 1980, Congress decided to shift the emphasis in federal programs toward providing preventive services to allow abused or neglected children to remain at home with safety rather than being placed in foster care. The purpose of the reasonable efforts requirement was to insure that, prior to the expenditure of federal dollars for foster care, reasonable efforts will be made to prevent the need to place the child in foster care. In addition, reasonable efforts must be made after placement to reunite the family. A judicial determination of those efforts serves to closely examine, in the case of each individual child, whether reasonable efforts were made to keep the family intact. Congress also required that a state must establish preventive and reunification services for all children in foster care, including those voluntarily placed by a parent, in order to obtain maximum funding under the IV-B Child Welfare Service Program.

The federal regulations require each state to designate in a plan which preventive and reunification services are available. While every state is not required to provide a specific set of services, a list of suggested services is provided:

(2) The services specified may include: twenty-four hour emergency caretaker, and homemaker services; day care; crisis counseling; individual and family counseling; emergency shelters; procedures and arrangements for access to available emergency financial assistance; arrangements for the provision of temporary child care to provide respite to the family for a brief period, as part of a plan for preventing children’s removal from home; other services which the agency identifies as necessary and appropriate such as home-based family services, self-help groups, services to unmarried parents, provision of, or arrangements for, mental health, drug and alcohol abuse counseling, vocational counseling or vocational rehabilitation; and post-adoption services.

95 C.F.R. § 1357.15(e)(2) (1986).

Under the reasonable efforts requirement, agencies can be required to provide services that are normally the province of other agencies. Samuel B. Magdovitz with Lisa M. Colautti and Robert G. Schwartz, A Guide to Judicial Decisions Affecting Dependent Children, p. 11 (Juvenile Law Center, Philadelphia: 1986). It has been suggested that trial courts:

[SJhould emphasize to the agency the high financial and psychological cost of maintaining a child in out-of-home care compared to the minimal cost of paying the family’s initial rent, security deposit or utility bill.
The court should use the power it has under federal law to require the agency to provide services that are not routinely available or to forgo federal reimbursement for the cost of placement.

Making Reasonable Efforts: Steps for Keeping Families Together, published by the National Council of Juvenile and Family Court Judges, the Child Welfare League of America, the Youth Law Center and the National Center for Youth Law (no publication date) at 59. This same publication also suggests that:

When the child welfare agency uses the services of other public agencies to meet its responsibility for making reasonable efforts, it should not simply refer families to other agencies and assume that the obligation has been met. Unless responsibility for a child’s or family’s case has clearly been delegated to the other agency and a mechanism for accountability has been established, the referring child welfare agency should retain responsibility for the case and for ensuring that the family receives the appropriate services.

Id. at 79.

The legislature has placed primacy on the right of parents to raise their own children and the desirability of children to be raised by their natural parents. In the present case, the onus was on CYS to address and support the claims in the dependency petition which it filed with clear and convincing evidence. This standard means that the testimony must be so direct and unambiguous so as to enable the trier of fact to come to a sure determination, without conjecture, of the truth of the exact facts at issue. In re Frank W.D., 315 Pa.Super. 510, 462 A.2d 708 (1983).

Our review of the record reveals a very young, unwed mother, lacking financial resources and housing who was unemployed. The mother, in a responsible fashion, turned to CYS to obtain assistance to provide and care for her child. There is no evidence that this young mother in any way neglected or abused her child. CYS has failed to present clear and convincing evidence to establish dependency and has failed to make reasonable efforts to prevent the separation of the mother and child.

A fundamental purpose of the Juvenile Act is to preserve family unity whenever possible. The Act limits the Commonwealth’s course of interference with the family unit to those cases where the parents have not provided a minimum standard of care for the child’s physical, intellectual and moral well-being. In Interest of Pernishek, 268 Pa.Super. 447, 408 A.2d 872 (1979). It is well-settled that the Juvenile Act was not intended to provide a procedure to take the children of the poor and give them to the rich, nor to take children of the illiterate and crude and give them to the educated and cultured, nor to take the children of the weak and sickly and give them to the strong and healthy. In re L, 477 Pa. 322, 383 A.2d 1228 (1978), cert. denied 439 U.S. 880, 99 S.Ct. 216, 58 L.Ed.2d 192 (1979); Stapleton v. Dauphin County Child Care Service, 228 Pa.Super. 371, 324 A.2d 562 (1974); In Interest of La Rue, 244 Pa.Super. 218, 366 A.2d 1271 (1976); In Interest of Black, 273 Pa.Super. 536, 417 A.2d 1178 (1980); Commonwealth ex rel. Grimes v. Yack, 289 Pa.Super. 495, 433 A.2d 1363 (1981). Neither will this Court tolerate the separation of a young child from a parent to protect agency funding.

Finding that the decision of the trial court constitutes an abuse of discretion, we reverse the order entered February 17, 1988 declaring the minor child to be dependent and remand with instructions that the child is to be returned to her natural mother.

REVERSED AND REMANDED.

      . Initially, CYS challenges the propriety of this appeal, contending that the appeal is premature, not being an appeal from a final order, because the February 17, 1988 Order specifically set March 23, 1988 as the date for a review hearing. Contrary to the contention of CYS, the hearing set by the February 17, 1988 Order whs intended by the trial court to be a periodic placement review anticipated by the Juvenile Act. The February 17, 1988 Order of the trial court vested custody of the child in CYS for appropriate placement after determining the child to be dependent. The scheduling of such periodic reviews does not vitiate the finality of an adjudication of dependency which is accompanied by a disposition of the child. See In Interest of C.A.M., 264 Pa.Super. 300, 399 A.2d 786 (1979). Hence no jurisdictional defect exists and this appeal was properly and timely filed.

      . This publication is available without charge from The Youth Law Center, 1663 Mission Street, San Francisco, California 94103, (415) 543-3373.


source: Caselaw Access Project

author: BECK, Judge: POPOVICH, Judge,

license: Public Domain

text:
    555 A.2d 129
    In re GLOSSER BROTHERS, INC. Appeal of GLOSSER BROTHERS, INC. Appellant. In re GLOSSER BROTHERS, INC. Appeal of W.S. WURZBURGER, Individually, Wurzburger, Morrow and Keough, Inc., and Morton Glosser, Appellants.
    Superior Court of Pennsylvania.
    Argued May 5, 1988.
    Filed Jan. 30, 1989.
    Reargument Denied March 17, 1989.

      Edward G. O’Connor, Pittsburgh, for appellant in no. 1052 and appellee in no. 92.
    Before CIRILLO, President Judge, and BECK, and POPOVICH, JJ.
   BECK, Judge:

This is an appeal and cross-appeal from a trial court determination of the fair value of the common stock of appellant/cross-appellee Glosser Bros., Inc. (the “Company”). The impetus for the trial court’s valuation was a petition by the Company for a determination of the fair value to be paid to appellees/cress-appellants, shareholders of the Company who dissented from a management sponsored leveraged buy-out and merger of the Company pursuant to Section 515 of the Business Corporations Law. 15 Pa.Stat.Ann. § 1515 (1967 & Supp.1988).

I. Background

The Company is a Pennsylvania corporation with its principal office and headquarters in Johnstown, Pennsylvania. It operated a chain of 24 discount department stores, 40 outlet stores, a conventional department store and a chain of supermarkets. At the time relevant to this appeal, 2,269,000 shares of the Company’s common stock were issued and outstanding. The stock was listed on the American Stock Exchange. Fifty to sixty percent (50-60%) of the stock was closely held by management and members of the Glosser family. The remainder was publicly traded. In the six months prior to the announcement of the instant transaction (the merger), the stock traded at an average rate of approximately 30,000 to 40,000 shares per month and at an average price of $14.00 per share. In the two years prior to the merger, the average monthly trading volume was slightly higher, but the average trading price was substantially the same. In the three years prior to the merger, the market price of the stock never exceeded $19.00.

On January 28, 1985, the Company announced a proposed merger whereby all of the common stock of the Company would be acquired in exchange for a cash payment to the shareholders of $20 per share. The goal of the transaction was apparently to shift control of the Company to a small management group. This group, working with the New York investment firm of Bear Stearns & Co., formed B.S. Holding Corporation, now Gee Bee Holding, which in turn formed a wholly owned subsidiary called B.S. Acquisition Corp. The latter corporation made the offer for the buy-out of the Company’s stock and proposed to merge with the Company. The proposed merger was approved by the vote of a substantial majority of the shareholders at a meeting held on September 12, 1985 and the merger became effective on October 11,1985. Thus, the net result was that B.S. Acquisition Corp. was the survivor of the merger and now owns the Company’s business. B.S. Acquisition is wholly owned by Gee Bee Holding, which in turn is controlled by the former management group of the Company.

Appellees/cross-appellants are three dissenting shareholders, namely, Morton Glosser, W.S. Wurzburger and Mr. Wurzburger’s wholly owned corporation, Wurzburger, Morrow & Keough, Inc. They refused to accede to the proposed merger, contending that the $20 per share price that B.S. Acquisition offered for their stock did not represent the fair value thereof. Therefore, as required by Section 515, the Company instituted this action for an appraisal of the stock. The Company’s petition named Morton Glosser as a dissenter, but did not name Mr. Wurzburger or his corporation. Mr. Wurzburger and his corporation petitioned to intervene, and their petition was granted.

The trial court did not appoint an appraiser, but rather conducted a several day trial without jury consisting mainly of expert testimony regarding a variety of methods of determining the fair value of the stock. The trial court ultimately determined that the fair value of the stock should be fixed at $31.00 per share and assessed interest at the rate of eight percent (8%) from the date of the merger. The trial court arrived at this value by assigning sixty-five percent weight (65%) to what it determined to be the asset value of the stock and thirty-five percent (35%) weight to what it determined to be the investment value of the stock. The court gave no weight to the stock’s market value as determined by the price at which it traded on the American Stock Exchange.

II. Valuation Issues

The Company challenges the trial court’s valuation on several grounds, only one of which we find to have merit. We will nevertheless address all of the Company’s properly preserved objections to the valuation for the purpose of guiding the trial court on remand.

A. Scope of Review

Initially we note that our scope of review in an appeal from a trial court determination of value under Section 515 has been clearly defined in our case law. In In re Jones & Laughlin Steel Corp., 328 Pa.Super. 442, 477 A.2d 527 (1984), we described our scope of review as follows:

We first look to the case of Appeal of O’Connor, 444 Pa. 206, 283 A.2d 279 (1971) in order to determine our scope of review.... the [O’Connor ] court stated:
Our review of this appeal encompasses only an ascertainment of whether the findings of the trial court are supported by competent and substantial evidence. We reject appellant’s request that we make an independent determination as to the fair value of her shares: ‘This court does not sit as a trier of issues of fact expecting to be persuaded that one or the other side is more credible. That is only a task for the trial court and we would never invade that area of the judicial process.’ (Footnotes and citations omitted).
Appeal of O’Connor, supra, 283 A.2d at 280.
The O’Connor court further noted that substantial evidence is more than a scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.

Id. 328 Pa.Super. at 457-58, 477 A.2d at 534-35. See also O'Connor Appeal, 452 Pa. 287, 304 A.2d 694 (1973); Note, Corporations — Fair Value for Dissenting Shareholders Under the Pennsylvania Appraisal Statute, 78 Dick.L.Rev. 582 (1974).

In recognition of our limited scope of review, we too will refrain from making an independent determination of the value of the Company’s stock. Thus, although the Company’s allegations of error as to valuation, particularly as stated in its post-trial motions, are at points no more than generalized attacks on the trial court's decision, we will address only those issues that were both specifically preserved in the trial court and properly presented to this court.

B. Relevance of Market Value

One of the Company’s strongest objections to the trial court’s valuation centers on the trial court’s refusal to assign any weight to the market value of the stock. We agree that this was error.

The leading Pennsylvania case defining the methodology for valuing stock in a Section 515 proceeding is the second O’Connor Appeal, decided by the Supreme Court in 1973. O’Connor Appeal, 452 Pa. 287, 304 A.2d 694 (1973). There, the Supreme Court instructed that fair value is to be construed as going concern value, as contrasted with liquidation value. The court noted that there is a potentially endless list of factors that are considered relevant to this value. The “going concern” concept of fair value in a dissenting shareholders’ appraisal proceeding and the many individual factors comprising it were aptly described by the Delaware Supreme Court in Tri-Continental Corp. v. Battye, Del., 74 A.2d 71, 76 (1950):

The basic concept of value under the appraisal is that the stockholder is entitled to be paid for that which has been taken from him, viz., his proportionate interest in a going concern. By value of the stockholder’s proportionate interest in the corporate enterprise is meant the true or intrinsic value of his stock which has been taken by the merger. In determining what figure represents this true or intrinsic value, the appraiser and the courts must take into consideration all factors and elements which might reasonably enter into the fixing of value. Thus, market value, asset value, dividends, earning prospects, the nature of the enterprise and any other facts which were known or which could be ascertained as of the date of the merger and which throw any light on future prospects of the merged corporation are not only pertinent to any inquiry as to the value of the dissenting stockholders’ interest, but must be considered by the agency fixing the value.

Id. at 72.

The O’Connor court noted that courts had properly distilled all of these factors into three principal valuation methods, i.e. (1) net asset value; (2) actual market value; and (3) investment value. The court defined these valuation methods as follows:

Net Asset Value is the share which the stock represents in the value of the net assets of the corporation. Such assets include every kind of property and value, whether realty or personalty, tangible and intangible, including good will and the corporation’s value as a going concern. Investment Value is an estimate of present worth in light of past, present and prospective financial records of the company and is obtained by capitalizing earnings. There are two basic steps in the capitalization process: calculation of a representative annual earnings figure, and choice of a capitalization ratio which reflects the stability and predictability of earnings of the particular corporation.
Market Value refers to the price at which the stock was selling on the market prior to the action which is objected to, disregarding any change in price due to the action.

O’Connor, 452 Pa. at 292-93 n. 7, 304 A.2d at 698 n. 7.

However, we do not read the O’Connor opinion as limiting a trial court to a consideration of only these three valuation methods. Id., 452 Pa. at 291-92, 304 A.2d at 697-98. Financial analysis has become increasingly complex with the passage of time. New methods of valuing investments have been developed and are generally accepted in the financial community as being reliable. In recognition of this fact, other jurisdictions that previously restricted a trial court to the foregoing three valuation methods have now expanded the types of valuation information that may be considered in a stock valuation proceeding. For example, in Weinberger v. UOP, Inc., 457 A.2d 701 (Del.1983), the Supreme Court of Delaware, known for its expertise in these matters, directed that Delaware courts would no longer be bound to use only the traditional “Delaware block” or weighted average approach to valuation. By this method, which is still generally in use in Pennsylvania and which was applied by the trial court in the instant case, the court considers only the three traditional methods of valúation, assigns each a percentage weight and adds the resulting amounts to come to a total value. The Weinberger court found this approach too restrictive and directed that courts henceforth use a “more liberal approach [which] must include proof of value by any techniques or methods which are generally considered acceptable in the financial community and otherwise admissible in court____” Id. at 712-13.

Although we do not question the reliability of the three traditional methods of valuation, we do recognize that they are not the exclusive methods to be used in determining going concern value. We approve of the Weinberger approach to valuation. Such a broader attitude not only comports with the O’Connor court’s recognition that all factors relevant to value should be considered, but will also serve to assist trial courts greatly in their difficult valuation task by allowing them to consider a broader and perhaps more sophisticated range of information.

Against this backdrop, we consider the more specific question of the relevance of market value to a determination of the fair value of stock in the context of a Section 515 proceeding. The relevance of this indicia of value has been aptly described by the Court of Chancery of Delaware as follows:

It is, of course, axiomatic that if there is an established market for shares of a corporation the market value of such shares must be taken into consideration in an appraisal of their intrinsic value. And if there is no reliable established market value for the shares a reconstructed market value, if one can be made, must be given consideration. It is, of course, equally axiomatic that market value, either actual or constructed, is not the sole element to be taken into consideration in the appraisal of stock.

Application of Delaware Racing Association, 42 Del.Ch. 406, 213 A.2d 203, 211 (1965). See also Henn, H. and Alexander, J., Law of Corporations § 349 at 1002-03 (3d ed. 1983) (“In situations where there is a reliable market value, such value is, in many jurisdictions, presumptively controlling; in other jurisdictions, market value is only one factor to be considered ... Of course, when there is no readily-ascertainable market value, various alternative indicia of value must be considered and weighted ..

Thus, market value is relevant to a determination of the true intrinsic value of stock on a going concern basis whenever it is reliable, i.e. whenever it represents the amount that a willing buyer is willing to pay for the stock and the amount for which a willing seller is willing to sell the stock in an open and free market. Market value becomes less relevant as its reliability decreases and may in fact properly be deemed irrelevant where it provides no reliable information as to the true value of the stock.

Pennsylvania cases are in accord with this view. In O’Connor itself, the Supreme Court found that although market value may generally be relevant, the market value of the stock at issue provided no guidance as to true value. The Court stated:

This case presents an instance where a certain method of valuation has no applicability whatever____[the company] is a closely-held family corporation having unlisted stock and therefore, no public market. Shares are sold too infrequently for market value to play any part in these proceedings ...

Id. 452 Pa. at 292 n. 6, 304 A.2d at 698 n. 6.

Following this analysis, in 1984 this court also affirmed a trial court conclusion that under the facts presented, the market value of the stock at issue should receive no weight in determining fair value. In re Jones & Laughlin Steel Corp., 328 Pa.Super. 442, 477 A.2d 527 (1984). The Jones court correctly noted that O’Connor does not require a trial court to assign weight to each of the three valuation methods, but rather to consider whether each is relevant in the context of the particular case. In Jones, one corporate stockholder held over eighty percent of the stock being valued and there was evidence that that stockholder had a “controlling and restrictive effect on the market value of the remaining shares traded on the market.” Id., 328 Pa.Superior Ct. at 459, 477 A.2d at 535-36. The court also noted that there was other evidence that the market value was unreliable. For example, earnings had been understated and an announcement of an increase in earnings had had no effect on the market price of the stock. Id. See also Bell v. Kirby, 413 A.2d 137 (Del.1980) (no weight accorded market value where 95% of stock held by one corporate stockholder and there were only isolated trades of remaining shares); In the Matter of Endicott Johnson Corp. v. Bade, 37 N.Y.2d 585, 376 N.Y.S.2d 103, 338 N.E.2d 614 (1975) (market value accorded little or no weight where 70-80% stock held by one corporate stockholder and stock had been delisted from national exchange).

These cases instruct us that market value is to be totally disregai’ded in determining fair value only in a limited number of situations. That is, market value is to be entirely disregarded where there is competent and substantial evidence to support the conclusion that the value at which the stock is trading is not at all reliable in gauging the stock’s intrinsic going concern value.

Applying this standard to the case sub judice, we find that the trial court erred in concluding that market value should be totally disregarded. We arrive at this conclusion despite our cognizance of the fact that the record reveals that the market value of the Company’s stock is of limited importance in assessing the stock’s fair value.

The trial court justified its refusal to consider market value on the following grounds:

... to consider the market value approach as a valid valuation method would be improper because the corporation as previously indicated was closely held and it was not traded on the open market as a result of national research being done on the history of the Company, and as such, did not and could not reflect its true value. Nearly half of the outstanding shares were held by relatives of the Glosser family or management personnel.

Trial Court Opinion at 3.

We concur in the conclusion that the fact that a high percentage of the outstanding shares of a corporation are closely held by one entity or group can indicate that the market value of the remaining shares is an unreliable guide to true value. See O’Connor Appeal, supra; Jones, supra. We also agree that thin trading in the remaining shares decreases the reliability of market value. Id. However, under the precise facts of this case, it is unwarranted to conclude that no weight is to be accorded market value.

Here, only 50-60% of the stock was closely held, as compared to the 80-100% levels of control that existed in those cases where market value has been disregarded. Although trading in the remaining Company stock was admittedly thin, the stock was listed on a national exchange and was steadily traded. Moreover, unlike Jones, this is not a case where there was any evidence of manipulation of the market or the exercise of control of the market by the family and management group. Finally, we do not see the relevance of the lack of “national research” having been done on the Company’s stock. It would unquestionnably open a Pandora's box were we to require the trial court in every appraisal matter to investigate how much independently generated investment information was available concerning a listed stock before it was traded in order to determine how accurately the market was reflecting the stock’s value.

We find this case most closely analogous to the recent case of In re Spang Industries, Inc., 369 Pa.Super. 133, 535 A.2d 86 (1987) (allocatur denied 9/13/88), where the court affirmed the trial court’s weighting of market value at only ten percent (10%). The court justified this conclusion as follows:

As Industries’ stock had been publicly traded, we find the trial judge properly included market value in his valuation considerations. We agree with the trial court that since Industries owned a majority of the stocks and the stock was lightly traded, it had a “controlling and restrictive” effect on the remaining shares being traded. Thus minimum value should be given to that consideration.

Id., 369 Pa.Superior Ct. at 142, 535 A.2d at 90.

We reach the same conclusion here. Since the Company’s stock was publicly traded, albeit thinly, and since the controlling group held only 50-60% thereof and did not manipulate market value, the trial court erred in totally disregarding market value. On remand, the trial court is instructed to include market value in its valuation considerations to a degree consistent with this opinion.

C. Expert Testimony and Exhibits Relevant to Net Asset Value

Perhaps the Company’s strongest objection to the trial court’s valuation centers on the testimony of one of the dissenting shareholders’ expert witnesses, Mr. Medwig, who testified as to the net asset value of the stock. Mr. Med-wig, who is basically a tax accountant with experience in stock valuation, testified that the net asset value of the stock was $38.00 per share. This valuation was necessarily based upon Mr. Medwig’s conclusions as to the true going concern value of the Company’s assets, which value was then allocated on a per share basis. The trial court noted that there had also been testimony by an expert for the Company to the effect that the net asset value of the stock was $19.00 per share, but creditted Mr. Medwig’s analysis and found a per share asset value of $38.00.

As stated above, the court gave no weight to the market value of the stock and opined that it would rely primarily on this asset value and to a lesser degree on the investment value as testified to by other expert witnesses. However, in light of what the court saw as an “obvious adversarial atmosphere”, the court reduced its reliance on the net asset value to sixty-five percent (65%) and attributed (35%) to the investment value. As we construe the trial court’s opinion, the court actually viewed this case as one where the asset value of the stock was the most reliable indicator of true going concern value. However, the court was also aware that the data it was provided on this value was influenced by the adversarial positions of the parties and their witnesses. In recognition of this fact, the court attempted to arrive at an equitable result by reducing its reliance on net asset value and giving more credit to the much lower investment value than the court was otherwise inclined to accord it.

The Company does not object to every portion of Mr. Medwig’s testimony. They consistently have admitted that Mr. Medwig was qualified to testify to the asset value of the Company’s stock insofar as he used “a balance-sheet oriented” approach, using as his source material the Company’s own financial records. The Company also does not object to Mr. Medwig’s reliance on value figures provided by an appraisal performed by Industrial Appraisals, Inc., which the Company had clearly adopted as being correct. The Company finds fault with Mr. Medwig’s testimony and with the sources that underlay it only insofar as Mr. Med-wig was permitted to testify as to the value of the Company’s fixtures, equipment, vehicles and leasehold improvements on the basis of another appraisal of those assets performed at the Company’s request by Manufacturers’ Appraisal Company and as to the value of certain leases based on Mr. Medwig’s own calculation of their value.

The Company contends that the Manufacturers’ appraisal, which was admitted into evidence as part of Mr. Med-wig’s documentation of his calculations, was inadmissible hearsay since no one from Manufacturers was called to testify as to the appraisal. Thus, the Company argues that Mr. Medwig’s testimony on the basis thereof was inadmissible as being based on facts not properly admissible into evidence. The Company also objects to Mr. Medwig’s reliance on his own calculation of the value of certain of the Company’s leases on the ground that he was not qualified to make such a calculation.

Appellees/cross-appellants counter that both the Manufacturers’ appraisal and Mr. Medwig’s testimony on the basis thereof was properly admitted. As to the appraisal itself, they argue that since the Company ordered the appraisal, referred to it in their proxy statement concerning the instant transaction, and used it in analyzing whether the Company might adopt a certain tax treatment of this transaction, it constitutes an adoptive admission of the Company. Alternatively, appellees argue that even assuming that the appraisal was inadmissible hearsay, Mr. Medwig’s opinion on the basis thereof was nevertheless admissible under the theory of Federal Rule of Evidence 703, which permits an expert to testify on the basis of reports not in evidence and/or not admissible into evidence if the report is “of a type reasonably relied upon by experts in the particular field in forming opinions or inferences on the subject.” Fed.R.Evid. 703. Appellees also argue that Mr. Medwig was qualified to place a value on those of the Company’s leases that had not been valued by anyone else using an accepted and conservative method of valuation based on comparable leases in the same area.

Preliminarily we note that in reviewing this issue, we must remain mindful not only of our limited scope of review of valuation determinations as set forth above, but also of the great discretion that is vested in a trial court concerning questions of the admissibility of evidence. Bessemer Stores v. Reed Shaw Stenhouse, 344 Pa.Super. 218, 496 A.2d 762 (1985). We will not disturb the decision of the trial court unless it is demonstrated to have been both an abuse of this discretion and harmful to the complaining party. Id. See also Klyman v. Southeastern Pennsylvania Transportation Authority, 331 Pa.Super. 172, 480 A.2d 299 (1984) (admissibility of expert testimony is matter initially for determination by trial court; reversal warranted only where discretion is abused).

Although the trial court has not provided us with any explanation for its admission of the evidence at issue, a review of the trial transcript reveals that the court was of the opinion that in the context of this non-jury trial, it should receive all of the available competent evidence on value and then make a determination as to the weight it would accord that evidence in making the ultimate valuation. Consistent with our foregoing discussion of the Weinberger case, we approve of this approach in general terms. In a non-jury action involving questions of such complexity where the court has exercised its option not to appoint an appraiser but rather to make its own valuation, we fully understand the court’s desire to have at its disposal as much competent evidence, including expert opinion, as possible. We also approve of the trial court’s realistic recognition, however, that the weight that should be accorded such evidence should be determined in light of the adversarial atmosphere that prevailed. We also presume that the weight to be accorded expert testimony will depend upon the court’s assessment of the qualifications of the expert insofar as each area of his testimony is concerned. Thus, we reject the Company’s challenge to the trial court’s admission of Mr. Medwig’s testimony on asset valuation and conclude that the Company’s objection is more appropriately addressed to the weight to be accorded to such testimony, which the trial court reduced to sixty-five percent (65%).

We begin with the Company’s second objection to Mr. Medwig’s testimony regarding the extent to which he relied on his own calculation of the value of certain of the Company’s leasehold interests. The Company argues that Mr. Medwig, who was not a real property appraiser, was not qualified to give an opinion on the value of these leases and, therefore, this aspect of his testimony was inadmissible. As to some of the Company’s leases, Mr. Medwig based his conclusions on the appraisals or computations of value done by Industrial Appraisals, which the Company adopted as reliable. As to others of the leases, as to which there was no actual appraisal or computation of value by an appraiser, Mr. Medwig did his own computations of value based on a computation of value the Company itself and/or its accountants had used for those leases. As to the remaining 21 leases the Company had, Mr. Medwig did a valuation of his own. It is as to these values that the Company objects.

Mr. Medwig fixed a value on these leases basically by using comparable values of other comparable store leases in the same area. His technique was the same as that used by the Company and/or its accountant in valuing certain other of its leases. Apparently, he determined the “economic rent”, i.e. the rent which comparable properties in the same area would bring and deducted the actual rent the Company was paying at each location multiplied by the number of years left on the lease. He then reduced this number to present value.

Mr. Medwig was properly qualified as an expert as to stock valuation. Pennsylvania law imposes a liberal standard for qualification of an expert, allowing a witness to testify as an expert if he has any reasonable pretension to specialized knowledge on the subject under investigation. The weight to be given to his evidence is for the factfinder. Commonwealth v. Gonzalez, 519 Pa. 116, 546 A.2d 26 (1988) (plurality) (citing Kuisis v. Baldwin-Lima-Hamilton Corp., 457 Pa. 321, 338, 319 A.2d 914, 924 (1974)). Given this broad standard, particularly when applied in the context of a valuation proceeding where the court needs a broad variety of information relating to the true value of the stock at issue, we cannot say that the trial court erred in admitting Mr. Medwig’s proposed valuation of certain of the Company’s leases.

Obviously the valuation method Mr. Medwig used was not as reliable as an actual appraisal. We note, however, that it was in accordance with a method the Company itself and its accountants had used for other leases. It was also in accord with the general principle that interests in real estate can be valued by comparison to similar properties in the same area. Philadelphia and Reading Coal and Iron Co. v. Commissioners of Northumberland County, 323 Pa. 185, 186 A. 105 (1936); McKnight Shopping Center, Inc. v. Board of Property Assessment Appeals and Review of County of Allegheny, 417 Pa. 234, 209 A.2d 389 (1965). Thus, although we would not find Mr. Medwig qualified to appraise the value of these leases as an appraiser, which he admittedly was not, we cannot say that the trial court erred in permitting Mr. Medwig to posit a value for them based upon data concerning these leases and comparable properties in the same area, as the Company’s own accountants had done as to other leases. The Company’s objection to Mr. Medwig’s testimony as to the value of these leases is more properly addressed to the weight to be accorded this aspect of the testimony, rather than to its admissibility and Mr. Medwig’s qualifications to give it.

We now turn to the more difficult issue of the admissibility of Mr. Medwig’s testimony concerning the value of the Company’s furniture, fixtures, equipment and vehicles, as to which he relied on the Manufacturers’ appraisal. Since Mr. Medwig was not an appraiser, but rather an expert in stock valuation, he necessarily had to rely on some source of information regarding the value of the assets underlying the stock other than facts within his own personal knowledge. Most of these facts were provided to Mr. Medwig in the manner an expert customarily receives the information necessary to form an opinion in a particular case. He relied largely on the Company’s own financial records as to the value of their property, calculations of that value performed for the Company by their own accountant, appraisal reports that the Company had ordered and records of the actual value received by the Company for one large sale of similar assets. The Company’s objection is directed to the fact that as to one group of assets, the underlying appraisal was allegedly both inadmissible and incorrect.

We agree with the Company to the extent that it argues that the Manufacturers’ appraisal itself, attached to Mr. Medwig’s calculations, would be inadmissible hearsay if offered to prove the truth of the matters asserted therein. It is an out-of-court statement and those who could testify and be cross-examined as to its contents were not called. Commonwealth v. Cassidy, 315 Pa.Super. 429, 462 A.2d 270 (1983). Moreover, the Company’s limited use thereof does not constitute an admission of its accuracy. The Company used the appraisal numbers only as a posited value of its assets to ascertain whether, using those numbers, the Company could elect a certain tax treatment of the merger transaction. The Company never took the tax election and therefore never used the appraisal numbers in a manner that reflected their acceptance thereof.

This does not convince us, however, that it was error for the court to admit the appraisal as part of Mr. Medwig’s report or that Mr. Medwig’s testimony, to the extent it relied on the Manufacturers’ appraisal, was also inadmissible. Once again, we view the Company’s objection as being more properly addressed to the weight to be accorded Mr. Medwig’s testimony than to its admissibility.

We recognize and do not question the propriety of Pennsylvania law’s general requirement that an expert witness base his testimony only on facts of record. Commonwealth v. Paskings, 447 Pa. 350, 290 A.2d 82 (1972); Collins v. Hand, 431 Pa. 378, 246 A.2d 398 (1968). However, we view this case as falling squarely within an exception to that rule which we also consider to be a salutary principle in our law.

The rule that restricts the basis for an expert’s opinion to facts properly of record is grounded in the view that while an expert may have a particular expertise in judging the consequences attendant upon a certain factual matrix, or the causes therefor, or the significance thereof, he cannot base this expert judgment on conjecture concerning those facts. Collins v. Hand, supra. However, courts have now begun to recognize that there are situations where the source of factual material relied upon by an expert is not admitted and/or admissible in evidence but is nevertheless not the product of mere conjecture by the expert. It is rather the type of source material the expert reasonably would rely on in forming his expert opinion. Thus, many courts have begun to liberalize their view as to the permissible underpinnings of expert testimony. The general exception that has been recognized is that set forth in Federal Rule of Evidence 703:

If of a type reasonably relied upon by experts in the particular field in forming opinions or inferences upon the subject, the facts or data need not be admissible in evidence.

This exception has now been applied in a number of Pennsylvania cases. In Commonwealth v. Thomas, 444 Pa. 436, 282 A.2d 693 (1971), the Supreme Court permitted expert medical witnesses to express their opinions based, in part, upon reports of others which are not in evidence but which the experts customarily rely upon in the practice of their profession. This application of the exception, to the testimony of medical experts, has perhaps been the most widely recognized application. It is certainly not the only scenario in which the exception has been applied. For example, in Steinhauer v. Wilson, 336 Pa.Super. 155, 485 A.2d 477 (1984), the court allowed an expert testifying as to construction costs to base his opinion in part on estimates of contractors not in the record. See also Bolus v. United Penn Bank, 363 Pa.Super. 247, 525 A.2d 1215 (1987), allocatur denied, 518 Pa. 627, 541 A.2d 1138 (1988) (expert accountant may rely on tax returns and financial statements in computing lost profits); Kearns by Kearns v. DeHaas, 377 Pa.Super. 200, 546 A.2d 1226 (1988).

The other area in which Pennsylvania law has for some time permitted experts to testify on the basis of reports of others not in evidence is the area of eminent domain proceedings. In such matters, valuation experts have been permitted to testify on the basis of appraisals performed by others who are not called to testify as to their appraisals. The Supreme Court explained and applied this principle in Pittsburgh Outdoor Advertising Corp. Appeal, 440 Pa. 321, 327, 272 A.2d 163 (1970), as follows:

The remaining argument pressed by Outdoor is the incompetency of the testimony of the Authority’s valuation expert. This is premised on the witness’ reliance on the written appraisal report of a qualified engineering firm in determining the value of the billboards based on reproduction cost less depredation. No copy of the report had been furnished to Outdoor, and no representative of the engineering firm was called as a witness.
The use by a testifying valuation expert of facts and figures derived from others and of which he himself does not have personal knowledge occurs frequently and is not a new development. To require direct personal knowledge by the expert witness of every element going to make up an appraisal figure would be to require the impossible. That there may be some hearsay evidence comprised within opinion evidence is undeniable. The components of an expert’s opinion, however, go to weight, not admissibility.

See also B.P. Oil Company, Inc. v. Delaware County Board of Assessment Appeals, 114 Pa.Commw. 549, 539 A.2d 473 (1988).

Pittsburgh Outdoor does not stand alone. In McCormick on Evidence, the author notes that valuation proceedings are another area, like medical expert testimony, where there is a growing trend toward allowing valuation experts to testify on the basis of facts not within their personal knowledge and outside the record. Cleary, McCormick on Evidence, § 15, 39 n. 3 (3d ed. 1984).

The Company attempts to distinguish such cases first by noting that they are decided under the Eminent Domain Code, which specically allows an expert to testify as to the bases of his opinion both within and without the record. We do not read the Pittsburgh Outdoor opinion as being based solely upon this provision of the Code. The portions of the opinion quoted above reveal that the court found the reliance of a valuation expert on “facts and figures derived from others” to be a practical necessity in such cases.

The Company also argues that in such cases the testifying valuation experts were relying upon reports of other identical valuation experts and thus could fully judge the reliability of the reports on which they relied. However, in Pittsburgh Outdoor itself the testifying valuation expert based his opinion on the report of an engineering firm as to reproduction costs of the property being valued. The opinion does not state that the testifying expert was himself an engineer who did or could calculate reproduction costs. It was indeed perhaps because the valuation expert was not himself engaged in calculating reproduction costs that he relied on the data of a qualified engineer as to such costs.

Moreover, we note that the Pittsburgh Outdoor rule has equally been applied by the Commonwealth Court to the testimony of an owner of property regarding the value thereof. Redevelopment Authority of the City of Harrisburg v. YWCA, 44 Pa.Commw. 295, 403 A.2d 1343 (1979). Since an owner is deemed to be qualified to express an opinion as to the value of his or her property, even though he or she has no independent qualifications as a valuation expert, the court found Pittsburgh Outdoor applicable and allowed the owner to express her opinion as to value on the basis of material outside the record. The court specifically rejected the argument that the Pittsburgh Outdoor rule did not apply because the owner, not otherwise expert in valuation matters, was not qualified to judge the reliability of the sources on which she relied. Id. at 299, 403 A.2d at 1345.

We find that the rationale of Pittsburgh Outdoor and similar cases, as well as the general rationale of Federal Rule of Evidence 703, argue forcefully for the admission of Mr. Medwig’s testimony on the asset valuation of the Company’s stock despite his partial reliance on the Manufacturers’ appraisal. The appraisal was admitted into evidence only as an exhibit to Mr. Medwig’s written calculations, since those calculations included a reference to the appraisal. Thus, it was admitted only to provide the court with a complete copy of the source of some of the figures underlying Mr. Medwig’s calculations. See N.J. Sports & Exposition Authority v. Cariddi, 164 N.J.Super. 127, 395 A.2d 895 (1978), aff'd, 84 N.J. 102, 107, 417 A.2d 529 (1980).

We also note that the appraisal carries its own “circumstantial guarantee of trustworthiness” to the extent that it was prepared by a professional appraisal company and one that the Company itself chose to appraise its assets. It is also important that Mr. Medwig did not rely exclusively on the Manufacturers’ appraisal of the subject assets. He compared the values placed by the appraisal with the values actually received by the Company in a sale of such assets consummated shortly after the merger. Having done so, Mr. Medwig found that the Manufacturers’ values were conservative when compared to the values received for such assets in an actual sale. Thus, Mr. Medwig’s use of the appraisal numbers was based not only on the appraisal but also on his own confirmation of their reliability.

Moreover, it is clear that any stock valuation expert need not be qualified to do his own appraisal of each of a corporation’s assets in order to place a value on the stock. Such an expert will quite commonly rely on “facts and figures” provided by other experts in reaching an ultimate valuation determination. The crucial point is that the court (or jury) be fully informed that these facts were in fact the partial basis for the expert’s opinion. The adverse party then has the opportunity, as the Company here did, to present its own countervailing facts and figures and/or expert testimony to convince the factfinder that the weight to be given to the other side’s expert testimony should be little or none.

Here, although the trial court largely credited Mr. Med-wig’s analysis that the asset value of the stock should be $38.00, the court reduced its reliance on that value to sixty-five percent (65%), thereby taking cognizance of the possible effect the adversarial quality of the testimony might have had on the valuation number. We find no error in this approach.

D. Failure of Trial Court to Tax Effect Asset Valuation

The last of the Company’s specific objections to the trial court’s determination focuses on the trial court’s refusal to consider the alleged tax effect of writing up certain of the Company’s assets. Simply stated, the Company alleges if its assets really have the higher value appellees would assign to them, then in the event the Company sold these assets and realized their value, the Company would also incur a higher tax liability on the sale. The Company argues that this potential tax liability should be considered to reduce the overall value of the Company’s assets. Although the trial court did not specifically address this contention in its opinion, it did accept Mr. Medwig’s asset valuation, which did not include tax effecting.

The Company supports its argument in this regard not by reference to any expert testimony on its own behalf regarding the propriety of tax effecting a write up of assets, but rather by reference to the comment of the O’Connor court that tax liabilities are one factor to be considered in valuing stock in a dissenters’ rights case. O’Connor Appeal, 452 Pa. at 292, 304 A.2d at 698. We do not read the O’Connor court’s passing reference to tax liabilities as being at all directed to the issue under consideration here. The O’Con-nor court was clearly referring only generally to the pertinence of actual tax liabilities in valuing stock. We find nothing in the opinion that provides guidance as to the question of whether the potential tax effect of assigning a higher value to a corporation’s assets than the book value thereof should be considered in valuing the stock. In fact, we have found no reference to this issue in any reported Pennsylvania case.

Our independent analysis of this issue has led us to conclude that the trial court did not err in accepting Mr. Medwig’s testimony. Mr. Medwig testified that since the valuation of the stock was to be made on a going concern basis, and the assigning of a higher value to the assets was therefore really an assessment of their true value in an operating business, it would be unrealistic to consider any higher tax that might be incurred as a result of this higher value. This is so because such a tax liability would only actually be incurred in the event of a liquidation of the business wherein the higher value was realized. Since the valuation was not predicated on a liquidation, consideration of the tax effect of a liquidation was unwarranted.

Given this testimony by a qualified expert, and the O’Connor court’s admonition that valuation in fact be done on a going concern basis, we find that the trial court’s rejection of the Company’s argument on tax effecting is supported by competent and substantial evidence of record. Thus, we will not disturb the trial court’s ruling on this ground.

III. Intervention of Mr. Wurzburger and Wurzburger, Morrow & Keough, Inc.

The Company’s last issue on appeal concerns the trial court’s decision to grant the petition of Mr. Wurzburger and his wholly owned corporation, Wurzburger, Morrow & Keough, Inc., to intervene in these proceedings as dissenting shareholders. The gravamen of the Company’s argument is that these shareholders did not comply with the requirements of Section 515 for perfecting rights as a dissenting shareholder.

We begin with a summary of the requirements of Section 515. In order to perfect a right to an appraisal of the fair value of stock and the payment of that value, Section 515 first requires that a dissenting shareholder make written objection to the proposed corporate action from which the shareholder dissents prior to the commencement of the voting of the shareholders on such action. Section 515 next requires that the dissenter not vote in favor of such action and, within twenty (20) days after the shareholder vote thereon, make written demand on the corporation for payment of the fair value of his/her shares. Such written demand must uniformly be made for all of the shares of which such shareholder is the beneficial owner, i.e. a shareholder cannot dissent as to some but not all of the shares he beneficially owns. 15 Pa.Stat.Ann. § 1515 B. The statute makes these requirements mandatory by stating that any shareholder who does not file written objection and then demand fair value is “conclusively presumed” to have consented to the proposed corporate action and may withdraw such consent only with the corporation’s consent. Id. § 1515 B & 1515 C.

The statute also requires that within twenty days after the shareholder makes written demand for payment of the fair value of his shares, he shall tender the certificates representing those shares to the corporation for notation thereon that the demand has been made. Id. § 1515 I. Unlike the requirements of sub-sections B and C of Section 515, this requirement is not invariable. Section 515 states that a shareholder’s failure to comply “shall at the option of the corporation terminate his rights under this section unless a court of competent jurisdiction for good and sufficient cause shown shall otherwise direct.” Id.

In this case, the Company consented to a slight variation on the requirements of the statute. In settling a separate lawsuit brought by dissenting shareholders against the Company, the Company executed a Stipulation and Agreement, to which both Mr. Wurzburger and Wurzburger, Morrow & Keough, Inc. were parties and which provided as follows:

Any holder of Stock as of the record date (the “Record Date”) for the special meeting of the shareholders of Glosser held on September 12, 1985 (the “Special Meeting”) who has timely filed either a written objection to the Merger or a written demand for payment of the fair value of his shares and who complies with the provisions of Section 5151 of the Pennsylvania Business Corporation Law (the “PBCL”), shall be entitled to receive the fair value, as determined in accordance with Section 515 of the PBCL, of all shares as to which such objection or demand was submitted, except that the issue of whether beneficial holders who have accepted payment for part of their shares are or are not entitled to receive fair value as determined in accordance with Section 515 for shares as to which they have not accepted payment shall not be affected by this settlement agreement and shall be decided in the appraisal proceeding.

The plain meaning of this agreement is that although the Company waived Section 515 B & C’s requirements of both written objection and written demand for payment of fair value, allowing either to suffice, it did not waive the Section 515 I requirement of tender for notation. This the Company intended to insist upon and there is no evidence of record that the Company ever waived it.

Both Mr. Wurzburger and his corporation objected to the proposed merger of the Company in writing prior to the September 12th shareholder vote and thus fulfilled this aspect of perfecting their dissenting shareholder rights. However, neither ever tendered its share certificates for notation under Section 515 I.

The Company argues that this omission is fatal. It persuasively notes that the statute allows the Company the option unilaterally to terminate these shareholders' dissenters’ rights. Mr. Wurzburger and his corporation counterargue that, as the trial court decided, they have shown “good cause” to be excused from this requirement. Wurzburger does not offer any explanation for why he did not comply with Section 515 I and his testimony, although somewhat equivocal, does indicate that he was aware of the Section 515 I requirement. Rather, the “good cause” that Wurzburger posits and that the trial court accepted consisted solely in the fact that one other dissenting shareholder, Mr. Yuhas, allegedly also did not tender his shares for notation and yet the Company has decided to afford him dissenting shareholder rights. At oral argument on the petition to intervene, counsel for the Company justified its treatment of Mr. Yuhas as compared to Mr. Wurzburger by stating that the Company took account of Mr. Yuhas’ lack of sophistication in granting him dissenters’ rights, while it felt that Mr. Wurzburger, a stockbroker for years, and his corporation were well aware of what needed to be done to perfect their rights.

The requirement of “good cause” for excusing a shareholder from tendering his/her shares that appears in Section 515 I is not defined in our appellate case law. It has been construed only twice in recorded trial court opinions. In Hamberg v. Pittsburgh Western Land Corp., 115 P.L.J. 85 (1966), the court held that where a shareholder had tendered his shares three days late and there was no showing of prejudice to the corporation as a result thereof, the lack of precise compliance with Section 515 I would not operate to deny the shareholder of his dissenters’ rights. Id. On the other hand, in In re Associated Wholesalers, Inc., 35 D. & C.2d 763 (1966), the court construed Section 515 I’s good cause requirement as imposing on the shareholder the burden of demonstrating some legal or equitable reason why it would be unfair or unjust to deny him dissenters’ rights despite his non-compliance. Id. Since the shareholders in the Wholesalers case provided no explanation for why they had failed to tender, the court denied them dissenters’ rights.

We agree that the burden is on the shareholder to show why he should be afforded dissenters’ rights. The statute provides the corporation the “option” of terminating the shareholder’s rights. If the exercise of this option is to be questioned, the shareholder has the burden of showing why. We also view the good cause shown requirement as properly focussing on whether there was a reasonable explanation for the failure to comply or other reason why the corporation’s termination of the shareholder’s dissenters’ rights was unwarranted, and not whether there was prejudice to the corporation. Whether there was prejudice to the corporation may only be relevant in a case, such as Ham-berg, where there is only a de minimus technical deviation from the requirement of Section 515 I that had no effect on the corporation and the court, therefore, determines that substantial justice requires that the deviation be ignored. That is not the case here.

Here, Wurzburger and his corporation have never tendered their shares and offer no explanation for their failure to do so. They posit only that they have been treated unfairly vis-a-vis Mr. Yuhas. While we agree that the corporation has an obligation to deal fairly with all of its shareholders in exercising its option under Section 515 I, the mere fact that Mr. Yuhas was listed as a dissenter by the Company while Wurzburger was not does not establish “good cause”. In such a circumstance, we conclude that the trial court erred in affording Wurzburger and his corporation dissenting shareholder rights. They must be excluded from this proceeding on remand.

IV. Cross-Appeal

Appellees/cross-appellants appeal from the trial court’s determination that interest on the appraised value of the stock should run at the rate of eight percent (8%), which the parties stipulated to be the prudent investor’s rate. They contend that the proper rate of interest should be the average rate currently paid by the Company on its borrowings. This rate was stipulated to be 11.3%.

The Company initially argues that the cross-appeal must be quashed because it was untimely. We must, of course, give full consideration to this contention at the outset, since it impacts upon our jurisdiction over the cross-appeal. Murphy v. Brong, 321 Pa.Super. 340, 344, 468 A.2d 509, 51 (1983).

The facts pertinent to the timeliness of the cross-appeal are as follows. The Company filed its appeal in a timely fashion on July 27, 1987. Pursuant to Rule of Appellate Procedure 903(b), appellees/cross-appellants then had 14 days within which to file their cross-appeal. On July 30, 1987, Pittsburgh counsel for appellee/cross-appellants prepared a Notice of Appeal and transmitted it by courier to their local counsel in Cambria County for filing with the prothonotary of the trial court as is required by Rule of Appellate Procedure 905. They also served copies of the Notice on counsel for the Company, the trial judge and the trial court administrator. The original notice of appeal was never filed. The courier’s receipt indicates that the package containing it was received by local counsel, but local counsel can offer no explanation for what happened to the document thereafter. It was simply lost.

On August 7, 1987, Pittsburgh counsel for appellees/cross-appellants received a docketing statement from this Court. It did not reflect the filing of a cross-appeal. Counsel addressed a letter to this Court noting the omission of the cross-appeal on the appellate docket and positing that perhaps the notice thereof had not timely been transmitted by the prothonotary of the trial court. Counsel apparently did not then check the trial court docket to make sure his client’s Notice of Appeal had in fact been filed.

On November 7,1987, when the Company filed its brief in this Court, the cover page indicated that there was a cross-appeal. This court contacted counsel for appellees/cross-appellants to inquire as to why no cross-appeal appeared on this Court’s docket. On November 24, 1987, appellees/cross-appellants filed a Petition to Allow Filing of Cross-Appeal Nunc Pro Tunc in this Court. We remanded the Petition to the trial court for initial determination of whether the late filing should be permitted under the rationale of Bass v. Commonwealth, 485 Pa. 256, 401 A.2d 1133 (1979), which permits late appeals where the late filing is caused by “non-negligent happenstance” and the appeal is then filed within a very short time, thus reducing any possible prejudice to the other side.

On January 4, 1988, the trial court held a hearing on the Petition, found that the cause of the late filing was non-negligent happenstance and granted the Petition. On January 15, 1988, appellees-cross/appellants filed their Notice of Appeal.

The Company renewed its contention that the cross-appeal should be quashed by filing a Motion to Quash in this Court. Decision on the Motion was referred to this panel. We find that the trial court abused its discretion in allowing this late-filed appeal and, therefore, will quash it.

We recently reviewed the Bass decision and its progeny in In re Interest of C.K., 369 Pa.Super. 445, 535 A.2d 634 (1987). We need not repeat that analysis at any great length here. In sum, we concluded that although Bass was unquestionnably binding precedent in this Commonwealth, its scope was exceedingly limited. Id. and cases cited therein.

Appellees/cross-appellants have offered no factual justification for their late filing. There was no fraud or breakdown in the processes of the court system, which are the traditional bases for the allowance of a late appeal. Id.; West Penn Power Co. v. Goddard, 460 Pa. 551, 333 A.2d 909 (1975). There was also no non-negligent happenstance following shortly by the filing of the appeal, as occurred in Bass. There was a simple omission to file the Notice of Appeal, unexplained by appellees/cross-appellants, and a failure to follow-up when, on August 7, 1987, counsel for appellees/cross-appellants was on notice that no cross-appeal had been docketed in this court. It was not until November. 1987 that appellees/cross-appellants finally took action to ascertain the status of their cross-appeal and to petition this court to accept it. There is no resemblance in these facts to those in Bass or in those few cases applying Bass. See footnote 4, supra. Thus, the cross-appeal must be quashed.

We further note that if we were to decide otherwise as to quashal, we would nevertheless affirm the trial court’s interest award. Section 515 provides that the trial court shall award such interest as the court may find to be fair and equitable under all the circumstances. This provision has been construed to vest a broad discretion in the trial court, including even the denial of any interest. See O'Connor Appeal, 452 Pa. at 298, 304 A.2d at 701 (statute requires award of interest except where inequitable situation exists; computation of interest may be done by several techniques, any one of which could be employed by trial court). We also note that in the only Pennsylvania case directly addressing the rate of interest payable to dissenting shareholders, In re Jones & Laughlin Steel Corp., 328 Pa.Super. 442, 477 A.2d 527 (1984), we affirmed the trial court’s award of interest based on the “prudent investor” standard, finding this to be fair compensation to the dissenters for the deprivation of the fair value of their stock from the effective date of the merger. Id., 328 Pa.Superior Ct. at 462, 477 A.2d at 537. See also Universal City Studios, Inc. v. Francis I. DuPont & Co., 334 A.2d 216 (Del.1975) (Supreme Court of Delaware accepts prudent investor rate of interest). Thus, we would find no error in the trial court’s interest award.

The cross-appeal is quashed.

IV. Disposition

The trial court’s final decree dated June 30, 1987 is reversed insofar as it grants the Petition to Intervene of Wurzburger and Wurzburger, Morrow & Keough, Inc. The trial court’s final decree is also reversed insofar as it results from no weight being assigned to market value. The case is remanded for a recalculation of value which includes the assigning of some weight to market value in a manner consistent with this opinion and for clarification or modification as directed in footnote 3 of this opinion. The court may receive such additional evidence on these points as it deems necessary. The court’s final decree is in all other respects affirmed. Jurisdiction is relinquished.

POPOVICH, J. files a dissenting statement.

POPOVICH, Judge,

dissenting statement:

When reviewing an appeal from a trial court’s determination of the value of a corporation under § 515 of the Business Corporations Law, 15 Pa.S.A. § 515, our scope of review encompasses only an ascertainment of whether the findings of the trial court are supported by competent evidence. We do not review the credibility of facts. Appeal of O’Connor, 444 Pa. 206, 208, 283 A.2d 279, 280 (1971). See also O'Connor Appeal, 304 A.2d 694. Upon review, I would find that the trial judge based his decision upon credible evidence and did not abuse his discretion in deciding not to consider the market value of the company’s stock as a valuation factor under the circumstances of this case. See In re Spang Industries, Inc., 369 Pa.Super. 133, 535 A.2d 86 (1987) (trial court was within its discretion when it excluded book value as an unreliable indicator of corporate value).

As the majority points out, “market value is to be entirely disregarded where there is competent and substantial evidence to support the conclusion that the value at which the stock is trading is not at all reliable in gauging the stock’s intrinsic going concern value.” Majority Opinion at 135. See In re Jones & Laughlin Steel Corp., 328 Pa.Super. 442, 477 A.2d 527 (1984); In the Matter of Endicott Johnson Corp. v. Bade, 37 N.Y.2d 585, 376 N.Y.S.2d 103, 338 N.E.2d 614 (1975); O'Connor Appeal, 452 Pa. 287, 292 n. 6, 304 A.2d 694, 698 n. 6 (1973). Instantly, the court observed that the controlling group held 50-60% of the corporation’s stock, the stock was thinly traded, albeit publicly, and the stock buy-out offer of $20.00 per share was considerably higher than the $14.00 per share market value. Based upon those facts, the trial court determined that the market value of the corporation “did not reflect its true value.” Trial Court Opinion at 3. As stated in Spang Industries, 535 A.2d at 91, “[t]he trial court may reject any factor which he believes to be unreliable.” Thus, I am convinced the trial court sub judice acted well within its discretionary powers.

Presently, the trial court was not the only participant who rejected market value as an accurate indicator of corporate worth. The appellants’ buy-out offer of $20.00 per share for a stock which the market valued at $14.00 per share was, in fact, a potent acknowledgment by the appellants that the trial court was correct in evaluating market value as unreliable. I am unable to find any abuse of discretion in the court’s decision when the appellants freely admit that the market grossly undervalued the corporation’s stock. Therefor, I must dissent from that portion of the majority’s decision which remands the case with instructions “to include market value in its valuation considerations to a degree consistent with this opinion.” Majority Opinion at 192.

      . One of the issues raised on appeal by the Company is the propriety of the trial court’s grant of these shareholders’ petition to intervene. The Company contends that these shareholders did not follow the requirements of Section 515 for perfection of a dissenter’s appraisal right. The facts pertinent to this issue will be more fully set forth below.

      . The importance of market value where it is deemed reliable can perhaps best be illustrated by the fact that some states, including Pennsylvania, have adopted a ‘‘listed stock” exception in their appraisal statutes. See, e.g., 15 Pa.Stat.Ann. §1515L&M. In Pennsylvania, this exception provides that where the stock in question is either listed on the New York or American stock exchange or is held of record by not less than 2,500 shareholders, in certain circumstances the appraisal remedy will not even apply. The rationale behind this exception is that under these circumstances, the dissenting shareholder can realize the true value of his stock simply by selling it on the open market. Henn, § 349. p. 1002 n. 12.

      . Judge Popovich dissents to this conclusion on the ground that it was within the trial court’s discretion to disregard market value in this case. In so concluding, Judge Popovich regards as significant the fact that the Company’s own offer of $20 was higher than average market value. Judge Popovich sees this as indicating the Company’s own distrust of the market value as a true indicator of fair value. In contrast, the significance of this fact is only that the Company did not see market value as the sole indicator of fair value. This reveals only that the Company was aware of the teaching of relevant case law cited in text which includes market value as only one of many factors that may be considered in determining fair value.

      . In the Company’s brief to this court, the Company also objects to the trial court’s asset valuation on two other grounds in addition to those specific objections to Mr. Medwig’s testimony which are discussed in text above. The objections are generally that Mr. Medwig relied on incorrect and internally inconsistent accounting methods in doing his asset valuation and that another expert witness for the dissenters, Mr. Reed, employed a variant of an asset valuation method which is totally unreliable.
      We find these issues waived in that they were not specifically preserved in post-trial motions. Pa.R.C.P. 227.1. The only possible reference to such challenges to the asset valuation may be found in the Company’s generalized post-trial statements that the trial court’s asset valuation was incorrect. These general statements of error do not preserve issues on appeal.
      We also note that were we to consider these issues, we would not find reversible error.
      We additionally note that in footnote 12 of the Company’s brief the Company mentions, without legal argument, three other alleged errors. None of these appear in the Company’s Statement of Questions section of its brief and are, therefore, waived. Pa.R.A.P. 2116. However, one of these points does merit clarification and perhaps reconsideration by the trial court on remand. This concerns Mr. Reed's valuation testimony. The Company states that the trial court arrived at too high a figure for the investment value of the stock by considering Mr. Reed’s testimony to be about investment value, whereas in fact the Company argues that Mr. Reed testified to a variation of asset valuation. We cannot determine on the record before us precisely how Mr. Reed’s valuation testimony should be classified. Although Mr. Reed stated that he was applying his own variant of an asset value method, he also stated that he was actually computing an overall "fair value” of the stock. The trial court itself characterized Mr. Reed’s testimony as asset valuation in the decree nisi, but in the final decree the court appears to have included Mr. Reed’s $43.00 per share value in the investment value calculation. As noted above, we could consider this issue waived. However, because there appears to be confusion as to exactly how the trial court construed and relied on Mr. Reed’s testimony, and in light of the fact that we must remand the matter in any event for reasons explained in text, the trial court should clarify and, if necessary, correct its use of Mr. Reed’s valuation testimony on remand.

      . Bass has been applied by the Commonwealth Court on several occasions. See, e.g., Perry v. Unemployment Comp. Bd. of Rev., 74 Pa.Commw. 388, 459 A.2d 1342 (1983). In each, the non-negligence of counsel in late filing was clear.

      . In a permitted post-submission communication by appellees/cross-appellants to this court, they argue that the fourth sentence of Rule of Appellate Procedure 905 “appears" to apply to the instant situation and would permit the late-filing of this cross-appeal. That sentence states "If a notice of appeal is mistakenly filed in an appellate court, or is otherwise filed in an incorrect office within the unified judicial system, the clerk shall immediately stamp it with the date of receipt and transmit it to the clerk of the court which entered the order appealed from, and upon payment of an additional filing fee the notice of appeal shall be deemed filed in the trial court on the date originally filed."
      Appellees/cross-appellants contend that this portion of this rule allows us to accept their cross-appeal because they served their Notice of Appeal on the trial judge and the court administrator, as is required by Rule of Appellate Procedure 906. Presumably appellees/cross-appellants would have us construe this to be a filing of the notice in another office of the judicial system.
      Our short answer to this contention is that service pursuant to Rule 906 is not filing pursuant to Rule 905.


author: McEWEN, Judge:

text:
    555 A.2d 147
    Joseph N. DeGENOVA and Rita DeGenova, Appellants, v. David G. ANSEL, M.D. and Amalgamated Life Insurance Company.
    Superior Court of Pennsylvania.
    Argued June 7, 1988.
    Filed Dec. 9, 1988.

      Eugene D. McGurk, Jr., Philadelphia, for appellants.
    Lynne P. Fox, Philadelphia, for appellees.
    Before McEWEN, OLSZEWSKI and CERCONE, JJ.
   McEWEN, Judge:

This appeal has been taken from the order of the trial court which sustained the preliminary objections filed by appellee Amalgamated Life Insurance Co. (hereinafter ALI-CO), and dismissed ALIGO as a defendant in the trespass action commenced by the appellants, Joseph N. DeGenova and Rita DeGenova. We are constrained to reverse and remand.

Appellant Joseph N. DeGenova (hereinafter appellant) was diagnosed by his primary physician as having a nasal polyp in his left nostril, which would require surgical removal. Appellant, a retired member of the Amalgamated Cotton and Textile Workers Union, was insured by ALICO under a medical health benefits plan which required appellant to obtain a second opinion before ALICO would pay for any surgical procedure. ALICO, therefore, scheduled an appointment for appellant with David G. Ansel, M.D., for purposes of obtaining a second opinion as to the proposed surgical procedure. The present controversy arose from that visit.

Appellant filed a complaint against Dr. Ansel and ALICO alleging that Ansel had removed the polyp from his nose while he was being examined, without his consent or knowledge, and that the surgical removal had been performed negligently, resulting in harm to the appellant. Appellant sought recovery from ALICO based upon its alleged vicarious liability for the acts of its agent, servant, or employee, defendant Dr. Ansel. In response to the complaint, ALICO filed preliminary objections in which it (1) moved for a more specific pleading as to its alleged agency relationship with Ansel, (2) moved to strike appellant’s complaint for failure to attach a copy of the insurance policy as required by Pa.R.C.P. 1019(h), (3) moved to strike appellants’ complaint on the ground that the action was preempted by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001-1461, and (4) demurred generally. The trial court sustained ALICO’s preliminary objections based on (1) its conclusion that appellants had failed to sufficiently plead, pursuant to Pa.R.C.P. 1019, an agency relationship between ALICO and Dr. Ansel, and (2) its conclusion that ERISA preempted the stated causes of action as to ALICO.

We note initially that the present appeal is properly before this Court. Although the grant of the preliminary objections filed by ALICO does not terminate the litigation, it effectively terminated the litigation against ALICO and is, therefore, appealable. See: Rossi v. Pennsylvania State University, 340 Pa.Super. 39, 44, 489 A.2d 828, 831 (1985).

The standard of review which we apply when examining a challenge to an order sustaining preliminary objections in the nature of a demurrer is well-settled:

All material facts set forth in the complaint as well as all inferences reasonably deducible therefrom are admitted as true for [the purposes of this review.] Clevenstein v. Rizzuto, 439 Pa. 397, 266 A.2d 623 (1970). The question presented by the demurrer is whether on the facts averred the law says with certainty that no recovery is possible. Hoffman v. Misericordia Hospital of Philadelphia, 439 Pa. 501, 267 A.2d 867 (1970). Where doubt exists as to whether a demurrer should be sustained this doubt should be resolved in favor of overruling it. Birl v. Philadelphia Electric Co., 402 Pa. 297, 167 A.2d 472 (1960).

Mahoney v. Furches, 503 Pa. 60, 66, 468 A.2d 458, 461-462 (1983), quoting Vattimo v. Lower Bucks Hospital, Inc., 502 Pa. 241, 244, 465 A.2d 1231, 1232-1233 (1983). Accord: Kyle v. McNamara & Criste, 506 Pa. 631, 634, 487 A.2d 814, 815 (1985); Judge v. Allentown and Sacred Heart Hospital Center, 506 Pa. 636, 639, 487 A.2d 817, 818 (1985). See also: Baker v. Magnetic Analysis Corp., 347 Pa.Super. 188, 192, 500 A.2d 470, 472 (1985).

Appellants initially contend that the trial court erred in concluding that they had not sufficiently pleaded the existence of an agency relationship between ALICO and Dr. Ansel, so as to permit a finding that ALICO was vicariously liable for the acts of Ansel. Appellants, in their complaint, set forth, inter alia the following averments:

4. At all times material hereto, defendant, Dr. David G. Ansel held himself out as a skillful and competent physician specializing in disorders of the ears, nose and throat.
5. At all times material hereto, defendant, Amalgamated Life Insurance Company provided medical insurance coverage for plaintiff, Joseph N. DeGenova.
6. On or about April 14, 1986, plaintiff, Joseph N. DeGenova was diagnosed as having a nasal growth which thereafter required that he enter the hospital for surgical removal and evaluation of the growth and post-surgical care.
7. As a condition of plaintiffs insurance contract with defendant, Amalgamated Life Insurance Company, Amalgamated sent plaintiff to defendant, David G. Ansel, M.D. for an evaluation of plaintiffs medical condition.
8. Defendant, David G. Ansel, M.D., was selected solely by the defendant, Amalgamated Life Insurance Company.
9. Defendant, David Ansel, M.D., at all times material hereto, acted as the agent, servant, employee and/or ostensible agent of defendant, Amalgamated Life Insurance Company.
10. On May 23, 1986, defendant David G. Ansel, M.D. removed the growth from the plaintiffs left nostril while plaintiff was being examined in defendant’s office.
11. At no time prior to the aforesaid procedure was plaintiff ever informed, advised or told by defendant Dr. Ansel that he intended to remove the growth.
12. At no time prior to the aforesaid procedure were the risks of removing the growth disclosed to plaintiff nor did plaintiff at any time prior thereto authorize or consent to any such procedure.
13. At no time prior to performing the procedure on plaintiff on May 23, 1986, did defendant David Ansel obtain a medical history on the plaintiff or advise him of alternative modes of treatment.
14. At no time subsequent to removing the growth did defendant Dr. Ansel analyze the growth or submit it for laboratory examination.
15. Defendant David Ansel discarded the tissue/growth which he removed from the plaintiff.

Rule 1019 outlines the fashion in which a cause is to be pleaded:

The material facts on which a cause of action ... is based, shall be stated in a concise and summary form____ Averments of time, place and items of special damage shall be specifically stated.

Pa.R.C.P. 1019(a), (f).

When all reasonable inferences of the foregoing provisions of the complaint are taken as true, we find that the averments as to the existence of an agency relationship between ALICO and Ansel are sufficient to comply with the requirements of Pa.R.C.P. 1019. Appellants alleged (1) that ALICO required the visit to a second physician, (2) that ALICO selected the physician and scheduled the visit with Dr. Ansel, and (3) that Dr. Ansel was the agent, employee, servant or ostensible agent of ALICO. “[A]n averment of agency is a fact that is admitted for purposes of a demurrer rather than a conclusion of law.” Line Lexington Lumber and Millwork Co. v. Pennsylvania Publishing Co., 451 Pa. 154, 301 A.2d 684, 689 (1973). As such dismissal of appellant’s claim against ALICO at the preliminary objection stage of the pleadings was unwarranted. See also: Boyd v. Albert Einstein Medical Center, 377 Pa.Super. 609, 620, 547 A.2d 1229, 1235 (reversed summary judgment finding a sufficient question of law existed as to ostensible agency relationship between doctor and insurer.); Aiello v. Ed Saxe Real Estate, Inc., 508 Pa. 553, 558, 499 A.2d 282, 285 (1985).

Appellants next argue that the court erred in concluding that their state law claims are preempted by ERISA, 29 U.S.C. §§ 1001-1461. Section 514(a) of ERISA provides:

The provisions of this title and Title IV shall supersede any and all state laws insofar as they may now or hereafter relate to any employee benefit plan.... 29 U.S.C. § 1144(a) (emphasis supplied).

The preemptive provision of ERISA was meant to establish pension plan legislation as an exclusively federal concern, reserving for the federal government the sole power to regulate the field of employee benefit plans. McMahon v. McDowell, 794 F.2d 100, 106 (3rd Cir.1986). While the statutory scheme provides the government with broad powers to regulate employee pension plans, “ERISA is not all encompassing.” Lane v. Goren, 743 F.2d 1337, 1339 (9th Cir.1984). The test to determine if a cause of action is preempted by ERISA remains whether or not the action “relates to” ERISA, and is not merely remotely related to the act. Shaw v. Delta Air Lines Inc., 463 U.S. 85, 103 S.Ct. 2890, 77 L.Ed.2d 490 (1983).

In the present case, we find that the appellants’ state law claims do not “relate to” ERISA and, therefore, are not preempted by the statute. Initially we observe that appellants are not seeking ERISA benefits or claiming improper distribution or administration of potential ERISA benefits. In addition, appellant, if these claims were found to be preempted by ERISA, would not be able to bring a similar civil action under ERISA, see 29 U.S.C. § 1132(a), and would have no remedy whatsoever against ALICO. The only relation appellants’ claims have to ERISA is that the employee benefit insurance contract required appellant Joseph N. DeGenova to submit to an examination by a second physician in order to have his medical bills for the proposed surgery covered by ALICO. The claims of both Joseph and Rita DeGenova are in tort for personal injuries and are not related to employee benefits or to the second opinion requirement of the health plan. Consequently, since appellants’ claims are only remotely related to ERISA, it cannot be said that Congress intended to preempt such actions when enacting the statute.

Finally, ALICO argues that appellants’ complaint should be stricken for failure to attach a copy of the insurance policy, as required by Pa.R.C.P. 1019(h). Appellants’ claims, however, are in tort, and are not based upon the contract of insurance. The contract, therefore, was not required to be attached to the complaint pursuant to Rule 1019(h).

Accordingly, we reverse the order of the trial court which sustained appellee’s preliminary objections and dismissed appellants’ complaint against ALICO. Case remanded. Jurisdiction relinquished.