author: BERNSTEIN, J.,

text:
    Robinson v. Wolters Kluwer Health Inc.

      Rosemary Pinto, Scott A. Love, Eric H. Weitz, Jason A. Itkin and Laura A. Feldman, for plaintiffs.

      Carolyn Purwin, Ernest F. Koschineg, Brandon L. Goodman, Robert C. Heim, Judy L. Leone, Christopher

      R. Boisvert and Catherine Wigglesworth, for defendants.
    May 1, 2015
   BERNSTEIN, J.,

—Mia Robinson was bom with severe heart defects. During pregnancy her mother took Zoloft for depression. The defendants claim the testimony of plaintiff’s experts on general and specific causation fail to meet the methodological requirements for admissibility of scientific opinion testimony and should be precluded at trial.

The Frye test, adopted into Pennsylvania in the case of Commonwealth v. Topa, has been clearly explained by the Supreme Court of Pennsylvania in Grady v. Frito-Lay, and the Superior Court in Trach v. Fellin.

The Frye test is an evidentiary standard for determining whether the methodology employed by a proposed witness is considered scientific by others in a relevant scientific field. The Frye standard to determine whether scientific expert testimony will “help” the jury is not applicable to all expert testimony. Although the proponent of evidence bears the burden of proving admissibility, this admissibility standard applies only when “novel science” is proposed. The Frye standard does not involve any judicial finding of the accuracy of the ultimate opinion. It is only the methodology employed which is to be evaluated, not the conclusions reached. The initial formulation of the Frye Court continues to be instmctive:

“Just when a scientific principle or discovery crosses the line between the experimental and demonstrable stages is difficult to define. Somewhere in this twilight zone the evidential force of the principle must be recognized, and while courts will go a long way in admitting expert testimony deduced from a well-recognized scientific principle or discovery, the thing from which the deduction is made must be sufficiently established to have gained general acceptance in the particular field in which it belongs.”

The Pennsylvannia Frye test for admissibility does not require this court to independently determine the judge’s understanding of the science of epidemiology, teratology or statistics as applied to the facts of Mia Robinson’s birth defects. Unlike courts which have adopted the Daubert standard, this court may not independently analyze or evaluate peer reviewed journal articles or other scientific material except as they relate to the methodology employed by the proposed expert witnesses in reaching conclusions. Thus as detailed by Justice Cappy in Grady v. Frito-Lay, the Frye test is comparable to other common judicial functions.

Writing for the court in Grady v. Frito-Lay justice Cappy said:

“One of the primary reasons we embraced the Frye test in Topa was its assurance that Judges would be guided by scientists when assessing the reliability of a scientific method.”
“We believe now, as we did then, that requiring judges to pay deference to the conclusions of those who are in the best position to evaluate the merits of scientific theory and technique when ruling on the admissibility of scientific proof, as the Frye rule requires, is the better way of insuring that only reliable expert scientific evidence is admitted at trial.”
“We also believe that the Frye test, which is premised on a rule — that of “general acceptance” — is more likely to yield uniform, objective, and predictable results among the courts, than is the application of the Daubert standard, which calls for a balancing of several factors. Moreover, the decisions of individual judges, whose backgrounds in science may vary widely, will be similarly guided by the consensus that exists in the scientific community on such matters.”

Although both the Frye and Daubert standards relate to methodology and not conclusions, the differences are dramatic. Under the Frye standard this court is required to perform factfinding only as to the synchronicity ofproposed expert testimony with acceptable scientific investigation. Pursuant to the Daubert standard scientific consensus does not per se permit opinion testimony. A scientific consensus that proper methodology was employed is only one of several nonexclusive criteria for determining whether the expert testimony will “assist” the jury. The Daubert standard requires the court to make an independent judicial scientific judgment whether the methodology is scientifically sound even if a scientific consensus of propriety exists. Judges with different understanding of scientific processes can make different rulings on the same opinion subject only to an abuse of discretion appellate review standard. Pursuant to the Frye standard the court need only determine whether an appropriate scientific community considers the methodology used to reach an opinion is scientifically sound. To be available for jury evaluation the methodology employed by the expert must be scientifically acceptable.

Real scientific knowledge is not and never has been static. Even using proper methodology, scientists routinely disagree and even reach different conclusions while accepting the same underlying data as accurate. Through the interaction of differing but scientifically appropriate conclusions derived from commonly accepted data, knowledge progresses. Likewise different scientific disciplines may properly opine on the same questions using different but proper methodologies.

Thus, the trial court faces two primary questions in any Frye analysis:

1. Is the data and other underlying information relied upon the type of data properly relied upon in a scientific discipline appropriate to the question presented for jury determination? And;
2. Was this proper data analyzed in accord with a scientific discipline appropriate to the question presented for jury determination?

In this case plaintiffs’ expert Dr. Jewell’s methodology used to conclude that Zoloft taken during pregnancy can be the cause of heart birth defects is challenged. Dr. Jewell based his analysis upon the same publicly available peer reviewed medical literature used by defense experts and by defendant Pfizer itself in internal documents. Dr. Kimmel, the primary defense expert witness at the Frye hearing agreed that the appropriate first step in determining whether Zoloft is teratogenic is to identify the relevant literature. Dr. Kimmel agreed that Dr. Jewell reviewed the appropriate literature: “Yes I listened so I certainly know Dr. Jewell and I looked at the same literature.” Pfizer’s qualified expert employees also looked at that same literature. These expert employees found 81 potentially relevant studies, abstracts, and papers of which 68 were not determined to be useful. The same thirteen studies formed the relevant literature used by plaintiff’s experts, defense experts, and Pfizer scientists.

Dr. Jewell analyzed these peer reviewed published studies which compared different populations and performed different analyses. Defendant Pfizer’s litigation experts and scientists analyzed the same body of literature to their conclusions. Defendant Pfizer’s May 2014 internal document entitled “response to Pharmacological Risk Assessment Committee (PRAC) cumulative review of Growth Retardation In Children and Adolescents” describes a comparable methodological review of the same literature and reports a remarkably compatible conclusions to that of Dr. Jewell namely “....a consistently positive association has been found for sertraline exposure and cardiovascular defects, especially septal defects.”

Of these relevant studies, six demonstrated positive associations between sertraline during pregnancy and teratogenic effects.

Dr. Kimmel agreed that some of these studies showed positive associations.

“Q. It says, some studies have found associations between sertraline use during pregnancy and particular birth defects, is that what it says
A. Yes it does.
Q. Do you agreed with that?
A. Yes.”

Although Dr. Kimmel disagreed with the Pfizer scientists who found an association he provided no description of any differences between Pfizer’s scientific methodology or that used by Dr. Jewell.

Dr. Jewell evaluated the studies which showed positive associations between Zoloft and heart birth defects and also evaluated the studies which revealed negative associations or were inadequate to formulate any scientific opinion. Dr. Jewell considered whether the positive associations were a function of random variation or chance. He evaluated possible confounding factors including detection bias, smoking, obesity, and confounding due to the underlying condition which caused Zoloft to be prescribed. Dr. Kimmel concedes that this next step in a methodological evaluation is also appropriate.

“Q. Dr. Jewell took these positive associations in his methodology and then assessed them for chance, bias, confounding, correct?
A. He did apply those ideas.”

Dr. Jewell evaluated other possible explanations for the association. Although Dr. Kimmel equivocated, he finally agreed that Dr. Jewell’s procedure, although debatable, was acceptable science.

“Q. That was one of the methods by which Komum attempted to address [confounding by indication]; is that correct?
A. That is.
Q. And that is a generally well-accepted methodology for testing confounding by indication, isn’t it?
A. It is a method. It is an inferior method to others, because confounding by —
COURT: Wait, wait, wait. The question was, isn’t it, and the answer is yes, isn’t it?
WITNESS: I would say there’s some debate in the pharmacoepidemiology world.
COURT: Is there a debate in your professional opinion?
WITNESS: Yes.
COURT: So you don’t have an opinion about whether [that’s] acceptable or not?
You’re not certain. Is that —
WITNESS: I am uncertain.
COURT: You can’t testify to a reasonable degree of scientific certainty whether that’s an acceptable methodological method, correct?
WITNESS: Yeah, it’s a method, yes. It’s an acceptable method.”

Indeed Dr. Kimmel admitted that he has used that same methodology in one of his own published peer reviewed articles.

Finally, Dr. Jewell analyzed whether the demonstrated associations represent an actual causal connection. Dr. Jewell evaluated the literature in accordance with commonly accepted criteria for evaluating causation, the Bradford Hill criteria, to determine whether the positive association is a product of chance or bias. Defendant expert Dr. Deepak Srivastava agreed that this is a proper criteria.

Conclusions contained in published peer reviewed literature results have found heart birth defects associated with Zoloft use. Dr. Jewell’s methodology and even his basic conclusions were further confirmed by a power point presentation prepared by Pfizer employee Francesca Kolitsapoulis entitled “Epidemiology Review of published literature on Sertraline Use and Teratogenic Effects in Pregnancy” which says:

“Epidemiological studies have shown that infants bom to women who had first trimester paroxetive exposure had an increased risk of cardiovascular malformations... .”

The defense concedes that if it had been properly performed, Dr. Jewell’s purported methodology was appropriately scientific. Although Dr. Jewell’s methodology facially comports with defendants view of proper methodology, the defense claims these proper factors were so improperly evaluated that his deviations from proper evaluation rises to the level of no scientific evaluation at all.

Defendant primarily presents three issues. The defense claims Dr. Jewell’s methodology is inadequate because of his improper assessment of confounding. The defense claims that Dr. Jewell’s analysis improperly considered studies which have overlapping populations as if they were separate studies. The defense claims that Dr. Jewell improperly “groups” or “lumps” cardiac birth defects.

The gold standard study is the randomized control trial in which the outcome of two comparable populations are identified and one is exposed to the medication. All agree that this gold standard cannot be ethically done concerning Zoloft in pregnant women. Thus, the studies from which conclusions can be dawn are observational studies. The parties agree on the relevant observational studies and substantially agree on the subgroup of observational studies which find an association between Zoloft and cardiac birth defects. Two Pfizer documents offered into evidence analyzed the same observational studies as plaintiff’s expert and reach comparable conclusions from those studies.

Dr. Kimmel agreed that Dr. Jewell’s methodology in determining whether the studies had replicated results was proper. Nonetheless the defense claims there are problems in Dr. Jewell’s evaluation of replication. The defense contends that since three studies have overlapping populations these studies cannot demonstrate replication.

Dr. Jewell acknowledged the overlapping populations but applied his expertise to determine that since they only partially overlap they nonetheless confirm and replicate the findings. Dr. Kimmel admitted that plaintiff’s experts’ consistency and replication opinions were confirmed by other study authors.

“Q. Dr. Jewell notes in his report that Pedersen concluded in his paper that agreement with data from a different population with a different type design is reassuring for the validity of our results. That shows some consistency in replication correct?
A. That’s what Dr. Pedersen says in his paper.
Q. Correct and that one of the papers you relied upon correct?
A. But it’s only one of many papers that...
Q. Is it correct or incorrect?
A. Yes it’s correct.”

The question of overlapping populations presents a proper topic for cross examination but not such a methodological defect as to warrant preclusion.

Defendants contend that Dr. Jewell’s use of not statistically significant data as a supporting trend is impermissible. However, Dr. Kimmel agrees that not statistically significant results could, if appropriately evaluated, support consistency.

“Q. Well can a non-significant result ever be used to support consistency in your professional opinion?
A. Sure, as long with all the other data that are inconsistent.”

Although Dr. Kimmel himself does not consider not statistical results as a “supporting trend” he does concede that some experts consider this methodologically appropriate.

“WITNESS: The term supporting trend is something that I actually did teach against because it leaves you up to total interpretation of what you believe of the number, so I cannot say that’s a supporting trend. That would be against my teaching.
COURT: Do others teaching epidemiology teach the supporting trend process that you don’t teach?
WITNESS: Possibly.
COURT: You’re not sure?
WITNESS: I’m not sure. I’m not sure.
COURT: Why do you say possibly then?
WITNESS: Well, I don’t sit in on classes. I don’t know what everybody teaches.
COURT: Yeah, but is there literature about it?
WITNESS: Oh, there are definitely —
COURT: And therefore, some might be using that literature to teach.
WITNESS: People will use that term for those values of P values.”
“Q: Do you believe that this statement as set forth here about statistical significance and nonsignificant results, that you can indeed take significant results and results that are not significant and use those to show a consistent affect?
A: I agree that you can do it...”
Q. And so in this paper, you relied upon insignificant results or nonsignificant results to support consistency; is that correct?
A. In this example, yes.
Q. Is that a valid methodology?
A. Assuming you look at all the data and not just pick the ones that are consistent with your theory.”

The defense claims Dr. Jewell improperly “lumped” birth defects because Mia Robinson’s primary cardiac birth defect was transposition of great arteries (“TGA”). The defense contends that causal conclusions can only properly be drawn from studies which showed an association between Zoloft and TGA. The defense claims that only statistically significant results for her most serious heart defects, TGA, should be used to demonstrate causation.

TGA is an exceptionally rare birth defect. The sample of birth defects in published studies segregated as to TGA alone are simply insufficient in number for a statistically significant association to be revealed. Most studies did not segregate TGA as a separate birth defect. Thus grouping or lumping is not claimed to be per se improper. The defense concedes it may be appropriate to lump or group cardiac defects for certain purposes.

Dr. Kimmel specifically testified that “lumping” could be a proper methodology.
Q. “And would it be proper to lump all the heart defects that occur in children births when they’re bom, would that be a proper methodology.
A. It’s not improper, but its —
Q. Does not improper mean proper or is that different.
A. It is proper assuming that you also look at the specific defects and treat those in the proper way. It’s one proper way of doing — looking at the data.”

The issue is whether an appropriate grouping was used by Dr. Jewell. The question as to general causation presented in this case is whether Zoloft taken during pregnancy can be the cause of any cardiac defect suffered by Mia Robinson at birth.

Dr. Jewell conceded that there is insufficient information to isolate TGA birth defects. Likewise, the defense agrees that the TGA birth defects isolated in the studies are too few for statistically significant associations to be found. The failure to find statistically significant results is because of the size of the populations in the studies and the infrequency with which TGA birth defects occur. Specific birth defects can be so finely isolated that insufficient numbers exist to ever demonstrate statistically significant results.

Dr. Kimmel agreed that birth defects can be differentiated so finely that no statistically significant results can be demonstrated. Dr. Kimmel further agreed that appropriate and scientific studies properly grouped TGA with other birth defects.

Under those circumstances, logic dictates and proper scientific methodology approves the necessity of grouping results. Not only was this methodology used by Dr. Jewell but also used by investigators in peer reviewed published studies, defendants’ experts, and Pfizer’s employees. If adverse consequences are finely differentiated, statistical significance cannot be found because of an insufficient number of examples. As the Superior Court insightfully recognized:

“Thus, a cause-effect relationship need not be clearly established by animal or epidemiological studies before a doctor can testify that, in his opinion, such a relationship exists. As long as the basic methodology employed to reach such a conclusion is sound, such as use of tissue samples, standard tests, and patient examination, products liability law does not preclude recovery until a ‘statistically significant’ number of people have been injured or until science has had the time and resources to complete sophisticated laboratory studies of the chemical.... In a courtroom, the test for allowing a plaintiff to recover... is not scientific certainty but legal sufficiency.... That [a] case may have been the first of its exact type, or that [a plaintiffs] doctors may have been the first alert enough to recognize such a case does not mean that the testimony of [the experts].... Should not have been admitted.”

Sometimes proper scientific conclusions must be extrapolated from available data. In Track v. Fellin, the Superior Court held that where the opportunities to examine a specific cause and effect relationship are limited, extrapolation from analogous studies is permissible. A number of applicable studies utilize the EUROCAT classification system which lump or group birth defects. Dr. Kimmel agreed that the EUROCAT classification system was properly scientific. Dr. Kimmel agreed that the studies which demonstrated associations with heart defects generally could not show association with specific heart defects. He explained:

“So one possibility is just a power issue right. So you have fewer numbers of individual defects. And that’s what the EUROCAT was saying, don’t look at every single line items, put them together so you will at least have enough within a physiologic, biologically plausible—.”

Dr. Kimmel agreed the Jimenes-Solom Peer Review articles properly grouped or lumped heart defects. He also agreed that lumping TGA with “other hearts defects” as a category, as in the Huybrechts study was proper.

“Q. So if you wanted to get any information about TGA from these studies you would have to lump that category with others wouldn’t you?
A. That’s what’s been — well that is — well, that’s what’s been done in Huybrechts and some of the other studies, that’s correct.”

Dr. Kimmel concedes, as he must, “there is a balance to be struck between lumping together heterogeneous sets of anomalies and splitting so finely that there are few cases in each group.”

The Superior Court decision in Track v. Fellin, is exceptionally instructive where the limitations of scientific studies and the impossibility of ethically having a gold standard methodology requires a practical evaluation. The court recognized that courts do not require perfection.

In Track v. Fellin, the plaintiff was given the wrong medication by the defendant Thrift Drug. Although the plaintiff was prescribed an antibiotic, he ingested six times the maximum permissible dosage of an anti-depressant. Of course there never could be any studies to determine the long term effects of taking six times the maximum permissible dosage of an anti-depressant medication. Plaintiff’s expert testified by extrapolating from the known side effects of the medication taken to opine as to the long term effects. The Track Court said:

“...in fact, it is a logical method used “to estimate the value of a variable outside its tabulated or observed range” or “to infer (that which is not known) from which is known.”

The Track court discussed at length the case of Donaldson v. Central Illinois Public Services Co., in which:

“the scientific community had been limited by the small number of neuroblastoma cases and its abilities specifically to link exposure to coal tar with development neuroblastoma.”

The experts in that case extrapolated from similar “but not identical studies and theories to conclude that coal tar exposure caused the children’s neuroblastoma.” That court said:

“...extrapolation is commonly used by scientists in certain limited instances...”; for example, when the medical inquiry is new or the opportunities to examine a specific cause and effect relationship are limited; when the number of cases limits study of the disease; or, as noted supra, when ethical considerations prevent exposing individuals to a toxic substance for research purposes. Id. At 85, 87, 262 III.Dec. 854, 767 N.E.2d at 328, 330. Accordingly, to the Donaldson Court, when an expert relies upon scientific literature discussing similar, but not identical, cause and effect relationships, the fact that the expert must extrapolate affects the weight of the testimony rather than its admissibility. Id. At 85, 262 III.Dec. 854, 767 N.E. 2d at 328 citation omitted).”

The Superior Court also quoted favorably from the case of Ferebee v. Chevron Chemical Co. :

“Thus, a cause-effect relationship need not be clearly established by animal or epidemiological studies before a doctor can testify that, in his opinion, such a relationship exists. As long as the basic methodology employed to reach such a conclusion is sound such as use of tissue samples, standard tests, and patient examination, products liability law does not preclude recovery until a ‘statistically significant’ number of people have been injured or until science has had the time and resources to complete sophisticated laboratory studies of the chemical. In a courtroom, the test for allowing a plaintiff to recover in a tort suit of this type is not scientific certainty but legal sufficiency; if reasonable jurors could conclude from the expert testimony that paraquat more likely than not caused Ferebee’s injury, the fact that another jury might reach the opposite conclusion or that science would require more evidence before conclusively considering the causation question resolved is irrelevant. That Ferebee’s case may have been the first of its exact type, or that his doctors may have been the first alert enough to recognize such a case, does not mean that the testimony of those doctors, who are concededly well qualified in their fields, should not have been admitted.”

The Superior Court concluded:

“as long as the basic methodology is sound the scientist may extrapolate from this sound scientific basis when it is either impossible or unethical to perform the sorts of clinic trials that would yield definitive results.”

Defendants claim that although plaintiff’s experts facially utilize an acceptable methodology the manner in which they applied this acceptable methodology is unacceptable. Thus the question presented by defendants in this Frye motion can be understood as when does a difference in degree become a difference in kind as to require preclusion. This court concludes that the differences presented here are differences in degree of a proper methodological analysis and not differences in the kind of analysis performed such that the methodology is improper. The issues and considerations presented in defendants’ Frye motions are certainly appropriate for effective cross examination but preclusion is not warranted. The Frye motions as to general causation are denied.

SPECIFIC CAUSATION

Plaintiffs’ specific causation experts opine that Mia Robinson’s cardiac birth defects were caused by exposure to Zoloft in útero. They base this opinion on their experience and clinical judgment. A physician must use clinical judgment and expertise to determine the possible cause of birth defects. This is vital for the physician to properly advise their patients who may wish to consider a second pregnancy. There is nothing novel about clinical judgment testimony. In Kendal v. Wyeth, Inc , the Pennsylvania Superior Court said: “certainly differential diagnosis is a generally accepted methodology.”

Dr. Abdullah, plaintiff’s expert ruled out other medications, diabetes, gestational diabetes, obesity, smoking, alcohol use, illegal drug use and second hand smoke as causes of Mia Robinson’s cardiac defects at birth. Dr. Abdullah also ruled out genetics. Likewise, Dr. Vekemans followed a similar approach. Their clinical judgment opinion is admissible.

The court notes that once the court concludes that general causation opinion is admissible opinion on specific causation may readily follow. In the case of Klein v. Aronchick, plaintiff’s experts had testified to direct causation. Nonetheless the Superior Court found reversible error because the trial court refused to give an “increased risk of harm” jury charge. In that case plaintiff’s expert report stated and the expert testified in court to a reasonable degree of medical certainty that the defendant doctors’ over prescription of medication had directly caused plaintiff’s kidney disease. The trial court refused to allow the expert who had offered such a definitive opinion as to direct causation to also testify that taking too many drugs had also increased the risk of kidney damage.

The Superior court said:

“although preferred the expert is not necessarily required to use the magic words of ‘increased the risk’ so long as the opinion is expressed to the requisite degree of medical certainty.”

The court held the plaintiff should have been permitted to argue increased risk of harm and a jury charge as to increased risk of harm should have been given.

It is of course a logical necessity that anything which actually causes a result must have increased the risk of causing that effect. Thus, the Superior Court instructs that when general causation testimony uses proper methodology and plaintiff presents actual causation evidence, if requested, a charge on increased risk of harm must be given. This jury instruction must be given even if never explicitly mentioned in the causation expert’s reports or testimony.

Since this court has found that the opinion that Zoloft can cause heart birth defects is permissible it is logically and necessarily permissible that specific causation experts be permitted to testify and plaintiff permitted to argue that the ingestion of Zoloft during pregnancy increased the risk of birth defects of the heart. It then becomes a jury question as to whether that increased risk presented by Zoloft was a factual cause of any specific heart birth defect. Plaintiff’s specific causation experts may testify.

      . No challenge is presented to the qualifications of any of the highly qualified experts.

      . 471 Pa 223, 369 A.2d 1277 (1977).

      . 576 Pa. 546, 839 A.2d 1038 (2003).

      . 817A.2d 1102 (2003).

      . Initially formulated in U.S. v Frye, 293 F. 1013 (D.C. Cir. 1923).

      . See Pa.R.E. 702.

      . Grady v. Frito-Lay, 576 Pa. 546, 839 A.2d 1038 (2003).

      . Track v. Fellin, 817 A.2d 1102 (2003).

      . See Track v. Fellin, specifically overruling Mackenzie v. Westinghouse, 674 A.d 1167 (Pa. Cmwlth. 1996).

      . Daubert v. Merrill Dow Pharmaceuticals Inc., 509 US 579, 113 S.Ct. 2786, 125 L.Ed 2d 469 (1993).

      . Like preliminary rulings as to authenticity (Pa. R.E. 901 et. seq. or personal knowledge (Pa R.E. 602) the court may not preclude opinion testimony because the Judge disagrees with the testimony. “Judges injury trials should not exclude expert testimony simply because they disagree with the conclusions of the expert.” Betz v. Pneumo Abex, LLC, 615 Pa. 504, 542-43, 44 A.3d27, 51 (2012).

      . General Electric Co., v. Joiner, et ux, 118 S.Ct. 512, 177 A.L.R. Fed. 667, 139 L.Ed.2d 508, 66 USLW4036.

      . Perfect or ideal is not the standard, See Track v. Fellin, 817 A.2d 1102 (2003).

      . It was agreed in conference that the court ruling concerning Dr. Jewell also would apply to Dr. Finnell, Dr. Cabera and Dr. Kapper because they use a commensurate methodology. This was incorporated in an Order dated February 10,2015.

      . N.T., 2/18 2015, 74:21-75:2

      . N.T, 2/18 2015,75: 6-15.

      . P-1 at the Frye hearing.

      . At pages 42-43.

      TN.T., 2/18, 2015 84: 10-15.

      . “Q. This paper that you reviewed earlier P-1, also says when focusing on a specific defect a consistently positive association has been found for sertraline exposure and cardiovascular defects especially sep-tal defects. Do you disagree with that conclusion? A. Yes.” N.T., 2/18 15 74/7-13

      . N.T., 2/18 2015 95-15-20.

        /Tr. 2-18-2015 p.m. at 19:21-21.3.

      . N.T. 2/18/15 21:4 12.

      . N.T., 2/13/13 pm at 6:17 21.

      . The defense has stipulated that the scientific investigators involved in the internal studies presented by plaintiff at the Frye hearing were appropriate Pfizer employees qualified to reach scientific conclusions.

      . An “accurate” conclusion reached through an improper methodology should be rejected and not presented for jury evaluation. A conclusion the court deems inaccurate reached through a proper scientific methodology is admissible in evidence subject to destructive cross examination before a jury. No explanation of any differences between the methodology utilized by Dr. Jewell and the methodology utilized by Pfizer’s employees who reached comparable conclusions was offered into evidence at the Frye hearing.

      . Other issues have been raised and are therefore preserved for all future purposes but are overruled without need to be specifically addressed in this memorandum opinion.

      . N.T., 2/18 71/12-24.

      . N.T., 2/18/2015 p.m. at 53/16-22.

      . N.T., 2/18/2015 p.m. at 53/16-22.

      . While the precise methodology of Pfizer employers has not be fully explained, it appears that they have grouped or lumped birth defects.

      . Track v. Fellin, 817A.2d 1102 at 1117 (quoting Ferebee v. Chevron Chemical Co., 736 F.2d 1529, 1535-36 (D.C. Cir. 1984), cert. denied, 469 U.S. 1062 (1984)).

      . N.T., 2/18 15 117 5-7 118:5-20.

      .N.T.2/18 15 111: 16-25.

      .N.T., 2/18 15 8:13-20.

      JÑ.T. 2/18 15 118/5-8.

      . Track v. Fellin, 2003 Pa. Super. 33, 817 A.2d 1102, 1114 (2003).

      /767 N.E.2d 314 (2002).

      . 736 F.2d 1535-1536 (D.C. Cir. 1984).

      . See Haney v. Panonelli, Pa. Super. 261, 830 A.2d 978 (2003).

      . 1154 EDA 2010, 2012 WL 112609 (Pa. Super. Ct. 2012).

      . See also, Snizavich v. Rohm Haas, 2013 Pa. Super. 315, 83 A.3d 191 Pa. Super 2013.

      . 85 A.3d 487 (2014).


source: Caselaw Access Project

author: GRAY, J.,

license: Public Domain

text:
    Warner v. Lycoming County Tax Claim Bureau

      C.P. of Lycoming County,
    No. CV-14-02016

      Jan M. Rumsy, for plaintiff.

      Peter Burchanowski, for defendant.
    May 5, 2015
   GRAY, J.,

Before the court are objections to an upset tax sale of September 10, 2014 timely filed on October 1, 2014. A hearing was held on March 25, 2015. For the reasons that follow, the objections to the tax sale are sustained and the tax sale is hereby set aside.

Procedural Background

On August 5,2014, the Tax Claim Bureau of Lycoming County filed a petition to waive the requirement of personal notice to owners/occupiers of properties listed for a tax sale for good cause shown after efforts at completing personal service appeared fruitless. On August 19, 2014, the court granted the motion. On October 1,2014, plaintiff Michael Warner filed the instant objection to the upset tax sale of his property. Since no case monitoring notice of a L206 cover sheet was filed requesting a hearing, the objections went to the file without being scheduled for a hearing. Although the objections were served upon the Lycoming County Tax Claim Bureau with a notice to defend, it does not appear that their counsel was aware of the objections. On October 17, 2014, the Lycoming County Tax Claim Bureau filed a consolidated return seeking, among other things, a decree of absolute confirmation of the sales that took place if no objections are filed to the sales within thirty days. The court entered a decree nisi on October 21, 2014 which indicated that the sale will become absolute if no objections are filed within thirty days. On November 6, 2014, the Tax Claim Bureau filed a reply to the objections to the tax sale. On November 21, 2014, the purchaser of the property filed a petition to intervene which included an L206 cover sheet. On December 1, 2014, the Tax Claim Bureau obtained a decree of absolute confirmation and for distribution executed by the prothonotary. A hearing on Mr. Lewis’s petition to intervene was scheduled for January 9, 2015. After a year, Mr. Lewis was granted permission to intervene. A hearing on the objections was held on March 25, 2015.

Findings of Fact

1. Plaintiff, Michael Warner’s property at 112 W. Fourth Street, identified as tax parcel number 66-0080-0602 was sold at an upset tax sale of September 10, 2014 to Intervenor, Daniel Lewis.

2. The property is a rental property with Mr. Warner residing at a rental unit on the property.

3. Mr. Warner was delinquent in taxes and was making payments to the Tax Claim Bureau to cure the delinquency.

4. The property was scheduled for a tax sale on September 10, 2014.

5. Before that date in September 2014, Mr. Warner went into the Tax Claim Office to make a payment and discussed what was needed to avoid the tax sale.

6. An employee advised him that Mr. Warner had until September 24,2014 to pay the delinquent amount to avoid a tax sale.

7. An employee of the Tax Claim Bureau testified that she was not authorized to stay the sale and did not recall making the statement. However, she confirmed that the writing on the tax notice was hers.

8. The writing on the tax notice states “No later ... WED. Sept. 24.”

9. There was no significance of the September 24,2014 date.

10. Mr. Warner went to pay the full delinquency on September 22,2014 and was advised that the property had been sold.

11. The court finds Mr. Warner’s testimony credible.

Discussion

In the present case, the court concludes that the tax sale must be set aside. The Pennsylvania Courts have repeatedly indicated that “the forfeiture of a person’s property rights for failure to pay taxes is a momentous event under the Pennsylvania and United States Constitutions.” Tracy v. County of Chester, Tax Claim Bureau, 507 Pa. 288, 489 A.2d 1334 (1985). “The purpose of the Real Estate Tax Sale Law is to ensure the collection of taxes, not to deprive citizens of their property or to create investment opportunities for those who attend tax sales.” Battisti v. Beaver County Tax Claim Bureau (In re Battisti), 105 A.3d 76 (Pa. Cmwlth. 2014), citing, Stanford-Gale v. Tax Claim Bureau of Susquehanna County, 816 A.2d 1214, 1216 (Pa. Cm with. 2003). When there is no enforceable agreement, the doctrine of promissory estoppel can be “invoked to avoid injustice by making enforceable a promise made by one party to the other when the promisee relies on the promise and therefore changes his position to his own detriment.” Crouse v. Cyclops Indus., 745 A.2d 606, 610 (Pa. 2000). In the present case an employee of the Tax Claim Bureau provided the owner with the date of “No later ... WED. Sept. 24[.]” The owner reasonably relied upon that statement and believed he had until that time to pay the delinquent taxes to avoid sale. Nonetheless, the property was sold four days prior to the deadline. As such, the court believes that the sale must be set aside because the owner reasonably and justifiably relied upon having until September 24, 2014 to pay the delinquency to avoid sale. To sell the property before that date without correcting the owner’s information deprives the owner of due process.

Accordingly, the court enters the following order.

ORDER

And now, this 5th day of May, 2015, upon consideration of Mr. Warner’s timely objections to the tax sale on September 10, 2014, said objections are granted. It is ordered and directed that the upset tax sale of September 10, 2014, of 112 W. Fourth Street, identified as tax parcel number 66-0080-0602, is hereby set aside.

      . The consolidated return was accompanied by a Lycoming County L-206 cover-sheet requesting the entry of an uncontested order. Along with the consolidated return was a Lycoming County Case Monitoring Notice seeking only an uncontested order, and nothing to be scheduled.

      . “The United States Supreme Court has held that due process is implicated in any taking of property for the collection of taxes [.]” In re Battisti, supra, citing, Jones v. Flowers, 547 U.S. 220, 234, 126 S. Ct. 1708, 164 L. Ed. 2d 415 (2006).

      . When the bureau accepts payments amounting to more than 25% of the taxes due, the tax claim bureau has an affirmative duty to inform the taxpayer of the payment agreement options under the Real Estate Tax Sale Law (Law), Act of July 7, 1947, RL. 1368, as amended, 72 RS. § 5860.603.” Darden v. Montgomery County Tax Claim Bureau, 157 Pa. Commw. 357, 629 A.2d 321, 323 (Pa. Cmwlth. 1993). Failure to do so “would deprive the owner of his or her property without due process of law.” Darden, supra., 157 Pa. Commw. At 360, 629 A.2d at 323. It is not the taxpayer’s burden to request an installment agreement. Analogously, once the Tax Claim Bureau provides a date to pay a delinquency to avoid a tax sale, the Bureau must keep that date or timely inform the owner otherwise. Failure to do so, deprives the owner of his property without due process of law.


author: WILLIAMSON, J.,

text:
    Farms Country Club Association, Inc. v. Lewandowski

      C.P. of Monroe County,
    No. 8695 CIVIL 2012

      George R. Hludzik, for plaintiff.

      Raddslaw Lewandowski, pro se defendant.
    May 6, 2015
   WILLIAMSON, J.,

This matter comes before us on a motion for summary judgment filed by Pocono Farms Country Club Association, Inc. (hereafter “plaintiff’) on December 17, 2013. Plaintiff filed the underlying complaint against Raddslaw Lewandowski (hereafter “defendant”) on October 12, 2012. Defendant filed an answer to plaintiff’s complaint on December 11, 2012. Defendant filed a second answer to plaintiff’s complaint on November 5, 2013.

Background

Plaintiff is a non-profit corporation which maintains and administers the common facilities in the Pocono Farms Country Club Subdivision. On November 9, 2004, defendant became the owner of Lot P5835, 5385 Salamance Lane, in the Pocono Farms County Club Subdivision.

Plaintiff’s bylaws and the implied covenants of the title to defendant’s lot require that defendant pay his ratable share of costs for the provision of services for the maintenance, operation, and preservation of the common areas of Pocono Farms Country Club. Plaintiff alleges that defendant has breached this covenant and has unpaid dues totaling fifteen thousand three hundred dollars and thirty-six cents ($15,300.36). This includes three thousand five hundred twenty one dollars and two cents ($3,521.02) in attorney’s fees and costs related to collecting these unpaid dues from defendant. Defendant contests the reasonableness of the charges.

Argument

Summary judgment may be granted pursuant to Pennsylvania Rule of Civil Procedure 1035.2 where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Thompson Coal Co. v. Pike Coal Co., 412 A.2d 466, 468-69 (Pa. 1979). Summary judgment is properly entered where the pleadings, depositions, answers to interrogatories, and admissions, together with affidavits, demonstrate that no genuine, triable issue of fact exists and that the moving party is entitled to judgment as a matter of law. Pa. R.C.P. 1035(b); Cosmas v. Bloomingdales Bros., Inc., 660 A.2d 83, 85 (Pa. Super. 1995).

Summary judgment may be granted only in cases where the right is clear and free from doubt. Musser v. Vilsmeier Auction Co., Inc., 562 A.2d 279, 280 (Pa. 1989). The court must examine the record in the light most favorable to the non-moving party and resolve all doubts against the moving party. Davis v. Pennzoil Co., 264 A.2d 597 (Pa. 1970). Moreover,, the burden is on the moving party to prove that no genuine issue of material fact exists. Long v. Yingling, 700 A.2d 508, 512 (Pa. Super. 1997). All doubts as to the existence of a genuine issue of material fact must be resolved against the moving party. Thompson, 412 A.2d at 469.

In response, the non-moving party may not rest upon the pleadings, but must set forth specific facts demonstrating a genuine issue for trial. Phaff v. Gerner, 303 A.2d 826 (Pa. 1973). The court may also accept as true all well-pled facts contained in the non-moving party’s pleadings. Mattia v. Employment Mut. Cos., 440 A.2d 616 (Pa. Super. 1982); Ritmanich v. Jonnel Enters, Inc., 280 A.2d 570 (Pa. Super. 1971). A general denial is unacceptable and deemed an admission where it is clear that the non-moving party has adequate knowledge and that the means of information are within the control of the non-moving party. Elia v. Olszewski, 84 A.2d 1889 (Pa. 1951).

Under the Uniform Planned Community Act (U.P.C. A.), a unit owners’ association may adopt and amend budgets for revenues, expenditures and reserves and collect assessments for common expenses from unit owners. 68 Pa. C.S.A. § 5302 (2). A unit owners’ association may also impose and receive payments, fees or charges for the use, except as limited by other provisions of this subpart, rental or operation of the common elements other than the limited common elements described in § 5202 (2) and (3) (relating to unit boundaries). 68 Pa. C.S.A. § 5302 (10). Further, a unit owners’ association may impose charges for late payment of assessments and, after notice and an opportunity to be heard, levy reasonable fines for violations of the declaration, bylaws and rules and regulations of the association. 68 Pa. C.S.A. § 5302 (11).

Pursuant to 68 Pa. C.S.A. § 5302, a unit owners’ association has the authority to impose and collect dues from an owner of a unit in that subdivision. Here, plaintiff is an incorporated unit owners’ association for Pocono Farms Country Club and defendant is the owner of Lot P5835 in Pocono Farms Country Club. These facts have not been disputed by defendant in any pleadings. Thus, plaintiff has the authority to impose and collect dues from defendant.

The applicable case law also supports plaintiff’s claims herein. Landowners, as beneficial users of common areas of development, are responsible for costs of maintenance of facilities. Meadow Run & Mountain Lake Park Ass ’n v. Berkel, 598 A.2d 1024 (1991). Absent express agreement prohibiting assessments, when an association of property owners in a private development is referred to in the chain of title and has authority to regulate each property owner’s use of common facilities, inherent in that authority is the ability to impose reasonable assessments on property owners to fund maintenance of facilities. Id.

As in Meadow Run, there is no express agreement in this case prohibiting assessments and there is a covenant to pay dues to an association of property owners in the deed. In plaintiff’s brief in support of their motion for summary judgment, they reference covenants attached to defendant’s deed. Covenant Number 16 states that:

An association of property owners is to be formed and designated by such name as may be deemed appropriate and when formed, the owner of the premises hereby conveyed, covenants and agrees that he, his heirs and assigns, shall be subject for the payment of annual dues and assessments in compliance with by-laws, rules and regulations to be promulgated.

Pi’s. mot. for summ. j.

That covenant attached to defendant’s deed clearly expresses that there is to be an association of property owners and that the owner of the premises will be subject to dues and assessments in compliance with the bylaws of the association. The bylaws state that the association’s board of directors shall “establish and enforce rules and rates for community services...and establish any special assessment, the annual common expense assessments, fines and other charges. Pi’s. mot. for summ. j.; complaint Exh. B (Bylaws 5.1).The bylaws further mandate that “upon a member’s default in payment of any charges due the association, the member’s obligation shall accrue interest at a rate not to exceed 15% per year.” Id. The bylaws of plaintiff’s association clearly state the association’s ability to collect dues and assessments, along with describing the interest rate to apply if a member defaults on payment. The bylaws also provide for collection, and therefore the legal fees associated therewith. Plaintiff’s bylaws, the covenant attached to the deed, and Pennsylvania law all provide for the relief sought by plaintiff. To this point, defendant has not provided any evidence to reach the level of a genuine issue of material fact.

We acknowledge and empathize with the defendant regarding the hardships he has overcome and those that he continues to encounter. He came to this country in search of a better life and to escape oppression. He has realized the dream of home ownership and financial independence.

However, his home is located in a community association, and the law requires adherence to regulations, billings, and rules. People can choose to purchase a home in a community association, or they can choose to live elsewhere. If they choose to live within the community association, it is expected that they will pay their fair share for amenities, services, infrastructure, maintenance and management. Should homeowners disagree with how the association is managed, the reasonableness of charges, and the fairness of rules, they may vote or run for the board (provided in good standing) to effect change as if in a democracy.

The rules, permits, procedures, dues, late fees and extent of services used are all debatable issues; but, not before this court regarding unpaid assessments. The bylaws apply to all owners equally. The U.P.C.A. applies to all owners equally. Unfortunately, an inability to pay, or non-use of an amenity or service does not exempt owners from an obligation to support the whole. That is the requirement of the bylaws and the U.P.C.A. that apply to defendant’s property.

The Association has to plow, pave and maintain all roads it owns within the development whether used by everyone or not. The roads, the water system, the golf course, and regulations and permits for taking down trees have direct and indirect benefits to all. These amenities allow travel throughout the community, provide water without the need for a well, a golf course amenity for fixture home buyers, and a uniform appearance of wooded lots, all of which can boost property values, or at least make properties more appealing for re-sale. We acknowledge property values are down all over Monroe County, and the defendant may not agree with this assertion, but property values in Pocono Farms would likely be lower without passable roads, a golf course, central water, and wooded lots.

The defendant also objects to the reasonableness of the charges, and plaintiff’s refusal to accept less than what is owed as a compromise. However, the defendant fails to recognize that what he offers in return is unreasonable, and unfair to all other homeowners who pay the full amount when due. If everyone paid what the defendant believes is fair, there would be no roads, no water system, etc.

It is unfortunate the defendant has now incurred late fees and attorney fees. However, the late fees are necessary to encourage homeowners to pay timely so the Association’s bills get paid. The attorney fees are to reasonably compensate the Association to pursue collection on those who do not pay. It would be unreasonable for the Association to have to pay those costs to collect what is owed under the bylaws and U.P.C.A.

The defendant alleged at argument that he was unaware of the rules, dues, and requirements at time of purchase and that his realtor never explained things to him. First, that is not a defense under the law. We also note the defendant did not mention hiring a lawyer at time of his purchase despite the large investment he was making. Finally, the U.P.C.A. requires that a re-sale certificate be given at least ten (10) days prior to closing to a buyer in all planned developments, including Pocono Farms. The re-sale certificate lists the yearly dues, and contains the bylaws and current rules and regulations. A buyer can then cancel a transaction after receipt and review of the re-sale certificate if done within a certain period of time. The defendant should have reviewed those documents at that time before proceeding to closing.

Defendant also argued that the plaintiff can only collect dues for the prior six (6) month period, similar to the application of the U.P.C.A. on banks that foreclose on properties. It is correct that a statutory lien exists for unpaid dues for six (6) months preceding a sheriff’s sale in a foreclosure. However, that has no application in the present matter.

Finally, the defendant argues he is now known as “Ron” Lewandowski, instead of Raddslaw Lewandowski. However, that does not change the relief sought, and entitled to by the plaintiff as claimed. While we understand the defendant’s positions, he has not provided facts in support of a viable defense.

Conclusion

There is no genuine issue of material fact as to whether defendant owns a lot in Pocono Farms Country Club and whether plaintiff is the unit owners association for Pocono Farms Country Club. There is also no dispute as to the covenant attached to the deed which expressly refers to the ability of an association within Pocono Farms Country Club to collect dues and assessments. Defendant has provided no evidence to support that these uncollected dues and assessments were unreasonable or sought illegally or in bad faith. Pursuant to Pennsylvania law, plaintiff has the right to collect reasonable dues and assessments from homeowners such as those stated by plaintiff in this case. Therefore, there is no genuine issue of material fact and this court finds in favor of summary judgment against defendant for an amount of fifteen thousand three hundred dollars and thirty-six cents ($15,300.36) due to plaintiff.

ORDER

And now, this 6th day of May, 2015, upon consideration of the motion for summary judgment filed by plaintiff, the motion for summary judgment is granted. Judgment in the amount of $15,300.36 plus interest and costs shall be entered in favor of the plaintiff and against the defendant.


author: GLAZER, J.,

text:
    Conestoga Bank v. Tioga Inv., LLC

      Philip Scott Rosenzweig and William Carl Katz, for appellant.

      Elliot H. Berton, for appellee.
    May 12, 2015
   GLAZER, J.,

Before the court is a petition to mark judgment satisfied, released and discharged. This petition requires the court to determine whether plaintiff, as judgment creditor of an insufficient judgment amount, timely filed its petition to establish the fair market value of real property acquired through a sheriff’s auction. For the reasons below, the court finds that plaintiff timely filed its petition.

Background and Discussion

Plaintiff, Conestoga Bank (the “bank”), loaned funds to defendant, Tioga Investments, II, LLC (the “borrower”). The loaned funds were secured by a mortgage against five distinct real properties located in Philadelphia, Pennsylvania. The complaint-in-confession-of-judgment asserts that borrower defaulted by failing to make payments to the bank when due. The bank confessed judgment against borrower on March 5, 2013, in the amount of $739,924.81 (the “judgment amount”). On April 26, 2013, a writ of execution was issued: the writ required the Sheriff of Philadelphia County to levy against the aforementioned five mortgaged properties. A sheriff’s auction occurred on November 7, 2013, and the bank acquired the five properties for $300,000.00. The five properties acquired by the bank appear to have a combined value inferior to the full judgment amount of $739,924.81.

When a judgment creditor acquires real property through a sheriff’s sale, and that property is insufficient to satisfy the full amount of judgment, then the judgment creditor must adhere to the requirements contained in Title 42 of the Pennsylvania Consolidated Statues, § 8103. The pertinent provisions thereof state as follows:

(a) General rule. — Whenever any real property is sold ... to the judgment creditor in execution proceedings and the price for which such property has been sold is not sufficient to satisfy the amount of the judgment... the judgment creditor shall petition the court to fix the fair market value of the real property sold....
(d) Action in absence of petition. — If the judgment creditor shall fail to present a petition to fix the fair market value of the real property sold within the time after the sale of such real property provided by section 5522 (relating to six months limitation), the debtor ... may file a petition ... setting forth the fact of the sale, and that no petition has been filed within the time limited by section 5522 to fix the fair market value of the property sold, whereupon the court, after notice as prescribed by general rule, and being satisfied of such facts, shall direct the clerk to mark the judgment satisfied, released and discharged.

The aforementioned requirement that a judgment creditor shall petition the court within a six-month period is found in Title 42 of the Pennsylvania Consolidated Statutes, § 5522(b)(2), which states as follows:

(b) Commencement of action required. — The following actions and proceedings must be commenced within six months:
(2) A petition for the establishment of a deficiency judgment following execution and delivery of the sheriff’s deed for the property sold in connection with the execution proceedings referenced in the provisions of section 8103(a) (relating to deficiency judgments).

On August 22, 2014, the bank received delivery of the deed to the five properties from the sheriff’s office. This deed, however, was incomplete because it did not contain the metes and bounds descriptions to some of the properties therein. Consequently, the Sheriff of Philadelphia prepared and delivered to the bank a “Corrective Deed” on September 29, 2014. Subsequently, the bank filed a petition to fix the fair market value of the property acquired through the sheriff’s auction. Through this petition, the bank seeks an order that would fix the value of the five properties to an amount in satisfaction of the judgment amount of $739,942.81. The petition to fix the fair market value of the five properties was filed more than six months after delivery of the first, incomplete deed, but within six months after delivery of the subsequent, corrective deed.

On March 4, 2015, before the bank filed its petition to fix the fair market value of the properties, borrower filed the instant petition to mark the judgment satisfied, released and discharged, notwithstanding the deficiency in the value of the property as acquired by the bank. In its petition, borrower argues that the bank failed to file the petition to fix the real estate value of the property within the statutory period of six months, beginning on August 22, 2014 — the date of delivery of the first, yet incomplete deed. According to borrower, the six-month period for the filing of the petition began to run upon delivery of the first, incomplete deed, and not upon delivery of the second, corrective deed. Borrower asserts that the second, corrective deed “does not extend or limit existing record legal title or interest”; therefore, the bank lost its opportunity to establish a judgment deficiency by failing to timely file its petition within six months from delivery of the first deed. The court is not persuaded by this argument.

Pennsylvania allows the execution and delivery of a corrective deed. Pa. R.C.P. 3135(b) states:

[i]f the sheriff has ... executed a defective deed, including the erroneous description of the real estate, the court, upon petition of the purchaser... may correct the... deed....

Simply stated, a corrective deed is a deed; therefore, the bank was entitled to file its petition for the establishment of a fair market value of the auctioned properties within six months after delivery of the incomplete deed, but also within six months after delivery of the corrective deed. The bank did not file a petition to fix the fair market value within six months after delivery of the incomplete deed, but did file the petition within six months after delivery of the corrective deed. Therefore, the bank timely filed its petition, and borrower’s petition for an order marking judgment satisfied, released and discharged is denied.

Defendants, Tioga Investments, LLC and Yip-Yap Wong, appeals from this court’s order of April 17, 2015, in which the court denied defendants’ petition to mark judgment satisfied, released and discharged. In support of that order, the court provided an opinion, a copy of which is attached hereto. For the reasons contained in that order, the court respectfully requests that its April 17,2015 order be affirmed on appeal.

ORDER

And now, this 17th day of April, 2015, upon consideration of defendants’ petition to mark judgment satisfied, discharged and released, plaintiff’s petition to establish fair market value of real estate, the respective answers in oppositions and memoranda of law, it is ordered as follows:

I. The petition of defendants Tioga Investments, LLC and Yip-Yan Wong to mark judgment satisfied, released and discharged is denied;

II. A hearing shall be held on May 11,2015 in courtroom 650, City Hall, Philadelphia, Pennsylvania, commencing at 11:00 a.m. addressing the matter presented by the petition to establish the fair market value of real estate of plaintiff, Conestoga Bank.

      . Complaint, ¶ 13.

      .42 Pa. Cons. Stat Ann. § 8103(a), § 8103(d) (West).

      . Metes and bounds are defined a “[t]he territorial limits of real property a measured by distances and angles from designated landmarks and in relation to adjoining properties.” “BLACK’S LAW DICTIONARY 1005 (7th ed. 1999).

      . Brief in support of petition to mark judgment satisfied, released and discharged pursuant to 42 Pa. C.S.A. § 8103(d), p.6 (citing 72 Pa. C.S.S. § 8103-C.3.).


author: HERTZBERG, J.,

text:
    Rosenthal v. Bane

      C.P. of Allegheny County,
    Nos. GD 13-11214; 358 WDA 2015

      Dianne Wainwright, for plaintiff.

      Michael O ’Day, for defendant.

      May 18, 2015
   HERTZBERG, J.,

This opinion supports my order issued on February 20, 2015, denying appellant Patrick Bane’s (“defendant”) petition to strike and/or open judgment by confession, which has been appealed to the Superior Court of Pennsylvania.

In 2008, defendant was the president of Comtel Communications, Inc. In December of 2008 Comtel Communications filed for protection under Chapter 7 of the United States Bankruptcy Code. In November of 2009 an engagement agreement was entered into by defendant and Alpem Rosenthal (“plaintiff’), out of which this case arises. In the engagement agreement, plaintiff agreed to provide litigation support to Comtel, in the Comtel v. Cello Partnership d/b/a Verizon Wireless litigation, in exchange for an hourly fee. All disputes arising in connection with the engagement agreement would be submitted to arbitration in accordance with the rules of the American Arbitration Association, and “[jjudgment on any award rendered in favor of any party shall be final and binding and may be entered in any court having jurisdiction thereof from which there shall be no appeal.” On June 8, 2010 Francis C. Rapp, Esq. and Fred E. Baxter, Esq. were employed by Comtel’s Bankruptcy trustee as special counsel to seek money potentially owed to Comtel by Cello Partnership d/b/a Verizon Wireless.

Plaintiff began performing work for defendant in November of 2009, plaintiff continued to perform work for defendant and invoice defendant, which defendant paid in part, until December of 2011. Finally, on December 30, 2011 plaintiff terminated its services for nonpayment. The dispute was submitted to arbitration in January of 2013. On April 19, 2013, the parties entered into a consent award and stipulation, signed by defendant, which was executed by the arbitrator on April 25, 2013. The consent award provided that judgment may be entered against defendant in the amount of $44,085.37 provided that plaintiff forbears from executing upon the judgment for ninety days after the date of the agreement.

On June 12, 2013 plaintiff initiated this case by filing a petition to confirm consent award and enter judgment, which was heard unopposed by the honorable Judith Freidman and on July 17, 2013 judgment was entered against defendant in the amount of $44,085.37. In Januaiy of 2014 and again in November of 2014, plaintiff served discovery in aid of execution on the judgment. Defendant failed to respond to any of these actions by plaintiff. Finally, on February 13, 2015 defendant presented a petition to strike and/or open judgment by confession, which I denied. On March 3,2015 defendant filed a notice of appeal, and on March 23, 2015 filed a timely concise statement of errors complained of on appeal (“concise statement”). In defendant’s concise statement, he alleges that I erred in two ways, which I will address below.

Defendant first alleges that I erred by denying his petition to strike and/or open judgment by confession on the pleadings. Defendant’s characterization of the judgment entered in plaintiff’s favor as a “confessed judgment” is incorrect. The instrument serving as the basis must have a clear warrant of attorney to enter confessed judgment. See Crum v. F.L. Shaffer Co., 693 A.2d 984 (Pa. Super. 1997). The judgment was based on a stipulation reached at arbitration, which was signed personally by defendant as an individual. The stipulation did not contain a warrant of attorney necessary to confess judgment. Instead, the basis of the judgment is rooted in Pennsylvania Law Governing Common Law Arbitration. 42 Pa.C.S. §7342(b) provides that when an arbitration award is entered, and upon application of a party, “...the court shall enter an order confirming the award and shall enter a judgment....” Therefore, though defendant attempted to style his petition as one to open/strike a confessed judgment, I did not look to confession of judgment law to evaluate defendant’s argument.

“It is well settled that a motion to strike judgment will not be granted unless a fatal defect appears on the record.” National Recovery Systems v. Monaghan, 322 Pa. Super. 183, 188, 469 A.2d 244 (1983). “Conceptually, a motion to strike judgment is in the nature of a demurrer directed to defects in the record. If the record is self-sustaining, the judgment cannot be stricken.” Id. at 188. The record in this case contains a stipulation to an arbitration award signed by defendant and a judgment confirming the award. The face of the record supports upholding the judgment and I committed no error by denying defendant’s petition to strike judgment.

Whether I erred by denying the petition to open judgment is determined by the authority for entry of the judgment on the arbitration award, which is 42 Pa.C.S. §7342(b). This provision in the Pennsylvania Judicial Code directs the entry of a judgment when a party files a petition to confirm the award “more than 30 days after an award is made by an arbitrator....” Pennsylvania’s Superior Court has consistenly interpreted this provision to mean that a party’s failure to challenge the arbitration award in the Court of Common Pleas within 30 days forever waives any errors in the arbitration process. See, U.S. Claims, Inc. v. Dougherty, 2006 Pa. Super. 337, 914 A.2d 874 and Sage v. Greenspan, 765 A.2d 1139 (Pa. Super. 2000). Thus, even an individual who did not attend an American Arbitration Association hearing was held to have waived all errors in the arbitration process because he did not challenge the award until two months later. U.S. Claims, Inc. v. Dougherty, supra. Since the arbitrator’s award against defendant is dated April 25, 2013 and defendant’s first challenge is the petition to strike and/or open judgment by confession served on January 30, 2015, defendant waived all errors in the arbitration process. Defendant therefore is not entitled to open the judgment on the award, and my decision to deny the petition to open is correct.

Defendant’s second allegation is that I erred by denying his petition to strike and/or open judgment by confession without issuing a rule to show cause and/or without permitting defendant to engage in discovery. A rule to show cause will only be issued if a petitioner states prima facie grounds for relief. Pa.R.C.P. 2959(3)(b). As described above,! do not find that a confessed judgment was entered against defendant. Certainly then, defendant has not produced a prima facie case to support striking or opening the judgment, therefore, I did not err by failing to issue a rule to show cause or failing to permit defendant to engage in discovery.

      . Neither the petition nor the answer, both of which I considered, were docketed until I directed copies of them to be docketed and filed by order dated May 13, 2015.

      . While defendant claims in the petition to strike that it is attorneys Rapp and Baxter who agreed to pay plaintiff’s fees, the engagement agreement instead states that “both Comtel Communications, Inc. and Patrick Bane will be responsible for the payment of all invoices for professional services rendered by this firm in connection with this matter and such will not be the responsibility of legal counsel.”


author: ZULICK, J.,

text:
    Holistic Fitness New Era LLC v. Local Flair, Inc.

      C.P. of Monroe County,
    No. 148 CV 2015

      Marshall E. Anders, for plaintiff.

      Mark A. Primrose, for defendants.
    April 21, 2014
   ZULICK, J.,

This matter comes before the court on defendants’ preliminary objections to plaintiff’s complaint. Plaintiff Holistic Fitness New Era, L.L.C. (Holistic) filed its complaint sounding in breach of contract and fraud on January 8, 2015. Holistic alleges it entered into a contract for services with Local Flair, Inc. (Local Flair) on May 22, 2014, and that Local Flair did not perform its duties according to the contract or the later supplemental contract. Alternatively Holistic seeks to recover damages based on unjust enrichment and/or promissory estoppel. Holistic additionally alleges that Alexandra Schratt, the president of Local Flair, acted individually in regards to its claims for unjust enrichment, promissory estoppel, and fraud.

Defendants Local Flair and Alexandra Schratt filed preliminary objections on February 4,2015, asserting that the complaint was legally insufficient, raising a demurrer as to Counts Two through Five (promissory estoppel against both defendants; unjust enrichment against both defendants; fraud against both defendants; and misrepresentation against both defendants), and moving to strike allegations for lack of specificity. All parties filed briefs, and oral arguments were held in this court on April 6, 2015.

The facts as alleged in the complaint are as follows. On May 22, 2014, “the parties entered into a written contract for services, including inter alia, logo design, packaging labels, website design, product brochure design, search engine optimization and social media implementation.” Complaint ¶ 7. Half of the payment, $6,937.50, was due at signing, which Holistic paid to Local Flair by check. Id. at ¶8. The contract also provided that one-fourth of the payment, $3,468.75, was due to Local Flair upon design approval, which Holistic paid on June 25, 2014. Id. at ¶ 10-11. On August 28, 2014, the parties entered into a supplemental contract which provided that $2,000 was due to Local Flair for the installation and configuration of an online “shopping cart” and website design. Id. at ¶ 12-13. Holistic paid $1,000 upon signing, pursuant to the supplemental contract. Complaint at ¶ 14-15.

Holistic paid $4,468.75 to Local Flair on September 19, 2014; this amount included the final one-fourth payment of the initial contract and the second half of the payment for the supplemental contract. Id. at ¶ 16. Holistic alleges that it paid $15,875.00 in total to Local Flair. Id. at ¶ 17. Local Flair performed less than half of its duties, and the work that was completed was done in a “shoddy, unworkmanlike manner.” Id. at ¶ 25. Holistic additionally alleges that Local Flair and Ms. Schratt misrepresented that they “possessed the requisite e-commerce, search engine optimization, and social media experience to complete the project as described in the contract within the timeframe described in the contract.” Id. at ¶ 42. Holistic hired additional companies and individuals to complete the work. Id. at 19-21. Because Holistic historically generated in excess of $194,982.51 during the second half of each calendar year, Holistic requests damages, including expectation damages, in excess of $60,000.

DISCUSSION

1. Legal Insufficiency of Pleading as to Ms. Schratt

First, the defendants assert the insufficiency of the complaint as to Ms. Schratt, arguing that Holistic contracted with and paid the corporation, Local Flair, Inc.

There is a strong presumption in Pennsylvania against piercing the corporate veil.... When making the determination of whether to pierce the corporate veil, the court ‘must start from the general rule that the corporate entity should be recognized and upheld, • unless specific, unusual, circumstances call for an exception.’... ‘Care should be taken on all occasions to avoid making the entire theory of corporate entity useless.’

Miners, Inc. v. Alpine Equipment Corp., 722 A.2d 691, 694 (Pa. Super. 1998).

Here, however, Holistic argues it is not attempting to pierce the corporate veil. Rather, Ms. Schratt is liable as an officer of the corporation for her individual actions under participation liability as recognized in Pennsylvania. “To impose liability on a corporate officer pursuant to the participation theory, a plaintiff must establish that the corporate officer engaged in misfeasance, i.e., ‘the improper performance of an act....’ However, a corporate officer cannot be held personally liable for nonfeasance, i.e., ‘the omission of an act which a person ought to do....’” Shay v. Flight C Helicopter Services, Inc., 822 A.2d 1, 17 (Pa. Super. 2003).

Fraud is the only misfeasance alleged in the complaint that could include Ms. Schratt under a participation theory of liability. The written agreement at issue here names Holistic and Local Flair as the parties, and Ms. Schratt consistently signed the documents as a representative of Local Flair. See Plaintiff’s Exhibits A-F. Holistic made its checks out to Local Flair, Inc. and not Ms. Schratt personally. Id. Thus, as will be discussed below, Ms. Schratt should not be included under the claims of unjust enrichment or promissory estoppel, because there is no indication in the complaint that she was enriched or was a party to any promise or agreement. However, as discussed below, fraud is averred sufficiently in the complaint, and it amounts to a wrongful act on the part of Ms. Schratt as well as the corporation itself, exposing Ms. Schratt to possible liability under the participation theory. This preliminary objection will be sustained in part and denied in part.

2. Demurrer as to Count II Promissory Estoppel

The defendants next raise a demurrer to promissory estoppel as it relates to Ms. Schratt individually. The standard for demurrer is “whether, on the facts averred, the law says with certainty that no recovery is possible.” Santiago v. Pennsylvania Nat. Mut. Cas. Ins. Co., 613 A.2d 1235, 1238 (Pa. Super. 1992). “Where any doubt exists as to whether a demurrer should be sustained, it should be resolved in favor of overruling the demurrer.” Id.

Where there is no enforceable agreement between the parties because the agreement is not supported by consideration, the doctrine of promissory estoppel is invoked to avoid injustice by making enforceable a promise made by one party to the other when the promisee relies on the promise and therefore changes his position to his own detriment, restatement *403 (Second) Contracts § 90; see, e.g., Shoemaker v. Commonwealth Bank, 700 A.2d 1003, 1006 (Pa. Super. 1997). In order to maintain an action in promissory estoppel, the aggrieved party must show that 1) the promisor made a promise that he should have reasonably expected to induce action or forbearance on the part of the promisee; 2) the promisee actually took action or refrained from taking action in reliance on the promise; and 3) injustice can be avoided only by enforcing the promise. Id. As promissory estoppel is invoked in order to avoid injustice, it permits an equitable remedy to a contract dispute.

Crouse v. Cyclops Industries, 745 A.2d 606, 609 (Pa. Super. 2000).

As discussed supra, Holistic has failed to aver that Ms. Schratt was ever individually a party to any promise or agreement regarding the present dispute. This preliminary objection will be sustained.

3. Demurrer as to Count III Unjust Enrichment of Ms. Schratt

The defendants raise a demurrer as to Holistic’s claim for unjust enrichment. Again, they argue that there is no averment that Ms. Schratt was enriched individually at all. “Where unjust enrichment is found, the law implies a contract, referred to as either a quasi contract or a contract implied in law, which requires that the defendant pay to plaintiff the value of the benefit conferred. In short, the defendant makes restitution to the plaintiff in quantum meruit...” Schenck v. K.E. David, Ltd., 666 A.2d 327, 328-29 (Pa. Super. 1995).

Holistic has failed to aver that Ms. Schratt was unjustly enriched. All of Holistic’s payments were made to Local Flair, Inc., not Ms. Schratt personally. Holistic has averred that Ms. Schratt “acted in both her individual capacity and in her capacity as President of Defendant Local Flair, Inc., with total disregard to the corporate structure,” Complaint at ¶ 6; however, such language is conclusory and does not amount to a sufficient averment. Lumax Industries, Inc. v. Aultman, 669 A.2d 893, 895 (Pa. 1995) (“In order to withstand a demurrer, the pleader must state what [a party] allegedly did that would bring her actions within the parameters of a cause of action based on a theory of piercing the corporate veil”). This preliminary objection will be sustained on this basis.

Defendants argue alternatively that Holistic’s claim for unjust enrichment should be stricken as barred by the gist of the action doctrine. “[T]he “gist of the action” doctrine[...] operates to preclude a plaintiff from re-casting ordinary breach of contract claims into tort claims.” Hart v. Arnold, 884 A.2d 316, 339 (Pa. Super. 2005). However, unjust enrichment is not a tort; rather, it falls under contract law as an alternative claim if a valid contract does not exist. See Schenck v. K.E. David, Ltd., 666 A.2d 327, 328-29 (Pa. Super. 1995).

The gist of the action doctrine precludes claims for allegedly tortious conduct where the gist of the action sounds in contract rather than tort.... This doctrine does not apply to alternative causes of action based upon implied or constructive contracts, such as the claims for unjust enrichment or promissory estoppel pled by plaintiffs....

J.K. Roller Architects, L.L.C. v. Tower Investments, Inc., 2003 WL 1848101 @ 1 (Pa.Com.PI. 2003).

Thus, unjust enrichment in this case is not barred by the gist of the action doctrine.

4. Demurrer as to Count IV Fraud

The defendants raise a demurrer as to Holistic’s claim for fraud against both defendants. “Fraud consists of anything calculated to deceive, whether by single act or combination, or by suppression of truth, or suggestion of what is false, whether it be by direct falsehood or by innuendo, by speech or silence, word of mouth, or look or gesture....” Woodward v. Dietrich, 548 A.2d 301, 304 (Pa. Super. 1988).

The elements of intentional misrepresentation or fraud are as follows:

(1) A representation;
(2) which is material to the transaction at hand;
(3) made falsely, with knowledge of its falsity or recklessness as to whether it is true or false;
(4) with the intent of misleading another into relying on it;
(5) justifiable reliance on the misrepresentation; and,
(6) the resulting injury was proximately caused by the reliance.

Bortz v. Noon, 729 A.2d 555, 560 (Pa. 1999).

For purposes of pleading, “[a] negations of fraud require pleading with particularity.” Sevin v. Kelshaw, 611 A.2d 1232, 1235 (Pa. Super. 1992).

While it is impossible to establish precise standards as to the degree of particularity required in a given situation, two conditions must always be met. The pleadings must adequately explain the nature of the claim to the opposing party so as to permit him to prepare a defense and they must be sufficient to convince the court that the averments are not merely subterfuge.

Bata v. Central-Penn National Bank of Philadelphia, 224 A.2d 174, 179 (Pa. 1966).

“[Pleading with particularity] means that the facts constituting fraud must be alleged.... What is prohibited is the allegation of fraud in a pleading as a mere legal conclusion without alleging the facts to support it.” Borelli v. Barthel, 211 A.2d 11, 14 (Pa. Super. 1965).

Here, Holistic has sufficiently pled intentional misrepresentation with particularity. Holistic averred that Local Flair and/or Ms. Schratt made false representations about their skill concerning social media, web design, etc.; second, that expertise was material to services addressed by the contracts; third, Holistic alleges that Local Flair and/or Ms. Schratt misrepresented Ms. Schratt’s personal skill in those areas, thus indicating that Ms. Schratt, the only officer of Local Flair, knew she did not have those skills; fourth, Holistic alleges that the misrepresentations caused it to enter into the contract; fifth, Holistic justifiably relied on those representations as to Ms. Schratt’s and/ or Local Flair’s personal expertise; and sixth, Holistic’s alleged damages were averred to be caused by Local Flair’s failure to complete the duties under the contract. This preliminary objection will be denied.

5. Demurrer as to Count V Misrepresentation

The defendants object to CountV- Misrepresentation as to Ms. Schratt, because Ms. Schratt made representations only in her capacity as an agent. However, as argued by Holistic and detailed supra, Ms. Schratt may be liable individually under participation liability. Misrepresentation constitutes misfeasance, and as Ms. Schratt is Local Flair’s sole officer, Holistic has sufficiently pled a claim of misrepresentation against Ms. Schratt.

However, intentional misrepresentation is synonymous with fraud, and there is no indication in the pleadings that Holistic alleged a different type of misrepresentation under Count V. As the averments under Count V are identical to those under Count IV for no apparent purpose, this preliminary objection will be granted.

6. Motion to Strike Allegations for Lack of Specificity

The defendants move to strike paragraphs 6, 7, 12, 20, 25, 28, 29, and 31 of the complaint for lack of specificity. “Pennsylvania is a fact-pleading jurisdiction. A complaint must therefore not only give the defendant notice of what the plaintiffs’ claim is and the grounds upon which it rests, but it must also formulate the issues by summarizing those facts essential to support the claim.” Sevin v. Kelshaw, 611 A.2d 1232, 1235 (Pa. Super. 1992); see also Feigley v. Dep’t of Corr., 872 A.2d 189 (Pa. Cmwlth. 2005) (specific averments, rather than mere notice pleading, are required in cases within this court’s original jurisdiction).

Paragraph 6 alleges that Ms. Schratt “acted in both her individual capacity and in her capacity as President of Defendant Local Flair, Inc., with total disregard to the corporate structure.” This language is boilerplate, as addressed supra, and Holistic does not detail why the corporate veil should be pierced along with alleging fraud against Ms. Schratt under participation liability. This objection will be granted.

Paragraph 7 states, “on May 22, 2014, the parties entered into a written contract for services....” The defendants object to the use of the word “parties,” as there are two defendants and it is unclear with whom Holistic contracted. This is not specific language given the multiple parties in the case, and this objection will be granted.

Paragraph 12 states, “the parties entered into a supplemental contract on August 28, 2014...,” Again, the use of the word “parties” in this context is unclear, and the objection will be sustained.

Paragraph 20 states, “the defendants failed to perform their duties as required by the contract or the supplemental contract,” and the defendants argue that Holistic has not referred to the duties not performed. The standard for specificity in pleadings is to allege sufficient information to allow the defendants to prepare a defense, and

A cause of action for breach of contract must be established by pleading (1) the existence of a contract, including its essential terms, (2) a breach of a duty imposed by the contract and (3) resultant damages. See Gen. State Auth. v. Coleman Cable & Wire Co., ...365 A.2d 1347, 1349 (Pa. Cmwlth. 1976). While not every term of a contract must be stated in complete detail, every element must be specifically pleaded.

CoreStates Bank, N.A. v. Cutillo, 723 A.2d 1053, 1058 (Pa. Super. 1999).

Here, Holistic should have alleged the duties the defendant(s) failed to perform, as that information is essential to preparing a defense. This objection will be sustained, and the language should be amended.

Paragraph 25 states the defendant breached the contracts by “failing to complete the contract work; less than half (1/2) the work was performed; and...performing the work that was done in a shoddy, unworkmanlike manner, requiring it to be redone.” Again, this averment does not detail sufficient facts concerning the work completed or not completed. This objection will be sustained, and the language should be amended.

Paragraph 28 states, “due to defendant’s failure to complete the project by the stated deadline, plaintiff suffered expectation damages for the months of June through present.” Here, the defendants argue “what were the plaintiff’s expectations? Further, if the work was ‘redone’ as plaintiff alleges, how can expectation damages continue to the present?” “[Wjhen a breach of contract occurs, the law protects a party’s expectation interest ‘by attempting to put [that party] in as good a position as he would have been had the contract been performed, that is, had there been no breach.”’ Newman Development Group of Pottstown, L.L.C. v. Genuardi’s Family Market, Inc., 98 A.3d 645, 659 (Pa. Super. 2014). Holistic will be required to specifically state the amount of revenues lost as a result of defendant’s breach, also being specific as to the timing of the losses.

Defendants have objected to the specificity of Paragraph 29 concerning current expectation losses. Again, plaintiff will be ordered to provide a more specific pleading as was required for Paragraph 28.

Finally, Paragraph 31 states, “in the event the court concludes that the contract(s) is(are) invalid or do not exist, defendants’ promise of performance and acceptance of payment constitutes promissory estoppel.” The defendants argue that Holistic has failed to allege the promises made by either Ms. Schratt or Local Flair; however, it is clear from the complaint that those promises are those alleged to be included in the written agreements between the parties. This preliminary objection does not have merit.

ORDER

And now, this 21st day of April, 2015, upon consideration of defendants’ preliminary objections and the briefs and arguments of both parties, it is ordered as follows:

1. The demurrer to Count II-Promissory Estoppel as it relates to Ms. Schratt is sustained;

2. The demurrer as to Count Ill-Unjust Enrichment as it relates to Ms. Schratt is sustained;

3. The demurrer as to Count IV-Fraud is denied;

5. The demurrer to Count V-Misrepresentation is granted, and that count is dismissed as duplicative;

6. The motion to strike the allegations of Paragraphs 6, 12, 20, 25, 28 and 29 for lack of specificity is granted for the reasons set forth in the accompanying opinion;

7. Defendants’ other preliminary objections are denied;

8. Plaintiff shall have twenty days to file an amended complaint in accordance with the rulings in this order.

      . Alexandra Schratt has signed the documents as “Ali Schratt, Local Flair,” without any indication of Local Flair’s corporate status, and Local Flair’s letterhead states only “Local Flair Creative.” However, Holistic has made payments to Local Flair, Inc., and the parties do not dispute Local Flair’s status as a corporation. See Plaintiff’s Exhibits A-F.


author: HARLACHER SIBUM, J.,

text:
    Nadrowski v. Velazquez

      C.P. of Monroe County,
    No. 7118 CV 2007

      Kevin P Foley, for plaintiff.

      Daniel E. Cummins, Lee Janiczek, Patrick J. Shea and Jennifer LeVan, for defendants.
    April 7, 2015
   HARLACHER SIBUM, J.,

This matter comes before us on defendants’ National General Assurance Company, GMAC Direct Insurance Company, and GMAC Insurance Company Online, Inc.’s motion for summary judgment. On December 7, 2007, plaintiff filed a complaint against defendants for injuries sustained following a motor vehicle accident. Plaintiff was a passenger in the vehicle driven by defendant Santiago Velazquez, owned by defendants Clifton and Gregg Kessler (Kesslers), and insured by defendants National General Assurance Company, GMAC Direct Insurance Company, and GMAC Insurance Company Online, Inc. (hereinafter GMAC). Plaintiff alleges a negligence claim against defendant Santiago Velazquez; a negligent entrustment claim against the Kesslers; a breach of contract claim against defendant Progressive Direct/ Progressive Halcyon Insurance; and seeks declaratory judgment against all defendants. On January 30, 2014, defendants GMAC filed the instant motion for summary judgment, arguing that plaintiff has failed to establish a direct, substantial, and present interest in having the insurance contract construed. After hearing argument on this matter, we are now prepared to decide this matter.

DISCUSSION

Pennsylvania Rule of Civil Procedure 1035.2 permits the trial court to dismiss an action after the close of pleadings where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Thompson Coal Co. v. Pike Coal Co., 412 A.2d 466, 468-69 (Pa. 1979). Summary judgment may only be entered where the pleadings, depositions, answers to interrogatories, and admissions, together with affidavits demonstrate that no genuine, triable issue of fact exists and that the moving party is entitled to judgment as a matter of law. Pa.R.C.P. 1035(b); Brecker v. Cutler, 578 A.2d 481 (Pa. Super. 1990).

Summary judgment may be granted only in cases where the right is clear and free from doubt. Musser v. Vilsmeier Auction Co., 562 A.2d 279, 280 (Pa. 1989). Only when the facts are so clear that reasonable minds cannot differ may a trial court properly enter summary judgment. Basile v. H&R Block, 761 A.2d 1115 (Pa. 2000). The trial court must view the record in the light most favorable to the non-moving party and must resolve all doubts as to the existence of a genuine issue of material fact against the moving party. Potter v. Herman, 762 A.2d 1116 (Pa. Super. 2000). The moving party bears the burden of proving that no genuine issue of material fact exists. Long v. Yingling, 700 A.2d 508, 512 (Pa. Super. 1997).

In response to a motion for summary judgment, the non-moving party may not rest upon the pleadings, but must set forth specific facts demonstrating a genuine issue for trial. Phaff v. Gerner, 451 Pa. 146, 303 A.2d 826 (1973). Failure to allege such specific facts will result in summary judgment, if appropriate, against the non-moving party. Pa.R.C.P. 1035.3; Overly v. Kass, 554 A.2d 970 (Pa. Super. 1989). The court must also accept as true all well-pled facts contained in the non-moving party’s pleadings. Mattia v. Employers Mut. Cos., 440 A.2d 616 (Pa. Super. 1982). The court must ignore contested facts contained in the pleadings and restrict its view to allegations in the pleadings that are uncontroverted and to material filed in support of and in opposition to a motion for summary judgment. Nationwide Mutual Ins. Co. v. Nixon, 682 A.2d 1310, 1313 (Pa. Super. 1996), allocator denied, 693 A.2d 589 (Pa. 1997) (citation omitted).

In the case sub judice, defendants argue that plaintiff does not have standing to bring this suit against the defendants. We agree. It is well-settled in Pennsylvania that an injured third party cannot directly sue a tortfeasor’s insurance company, and is limited to a suit against the tortfeasor. Pennsylvania Department of General Services v. Celli-Flynn, 540 A.2d 1365 (Pa. Cmwlth. 1988). Absent a statutory or policy provision, the plaintiff cannot file suit against the insurer even if the plaintiff was to receive a judgment against the insured. Folmar v. Shaffer, 332 A.2d 821 (Pa. Super. 1974).

One exception to this general rule was recognized in Guy v. Liederbach, 459 A.2d 744 (Pa. 1983), where the Supreme Court allowed the intended beneficiary of a will to recover for legal malpractice, despite the fact that the beneficiary was not in privity of contract with the attorney and was not named as an intended beneficiary of the contract. To be considered a third party beneficiary in this state, it is necessary to show that both parties to the contract had intent to benefit the third party through the contract and did, in fact, explicitly indicate this intent in the contract. Spires v. Hanover Fire Ins. Co., 70 A.2d 828 (Pa. 1950). Another exception to the general rule has been codified in 40 Pa.S. § 117, which authorizes an injured party to bring suit against a liability insurer, premised on the insured’s insolvency. Upon review of the pleadings filed, plaintiff does not allege that she is entitled to sue based on a third party liability status, nor does she allege that the insureds in this case are insolvent triggering 40 Pa.S. § 117.

Furthermore, defendants argue that plaintiff’s claim against them for declaratory judgment cannot be sustained as plaintiff failed to establish an actual controversy and a direct, substantial and present interest in having the insurance contract construed. The Declaratory Judgment Act provides at 42 Pa.C.S.A. § 7532:

Courts of record, within their respective jurisdictions, shall have power to declare rights, status, and other legal relations whether or not further relief is or could be claimed. No action or proceeding shall be open to objection on the ground that a declaratory judgment or decree is prayed for. The declaration may be either affirmative or negative in form and effect, and such declarations shall have the force and effect of a final judgment or decree.

The Commonwealth Court in South Whitehall Township v. Commonwealth Dept. of Transportation, 475 A.2d 166 (1984) stated:

“In seeking declaratory relief, a plaintiff must establish an interest which ‘must be a direct, substantial and present interest, as contrasted with a remote or speculative interest.’ For declaratory relief to be appropriate, there must exist an actual controversy.”

Id. at 169 (citations omitted).

In Chester Upland School District v. Commonwealth, 495 A.2d 981 (Pa. Super. 1985), the Commonwealth Court said that “[declaratory judgment is not appropriate to determine rights in anticipation of events which may never occur.”

Here, plaintiff has failed to demonstrate any direct, substantial and present interest on her part in having the insurance contract in question construed, as she has not yet obtained a judgment against any of the defendants in this action. Plaintiff, here, seeks declaratory judgment as to her rights to recover under the insurance contract; however, she is not entitled to such declaratory judgment as none of the insureds have been found liable for any damages. Therefore, plaintiff’s rights to recover under the insurance contract are not ripe for review.

ORDER

And now, this 7th day of April, 2015 upon consideration of defendants National General Assurance Company, GMAC Direct Insurance Company and GMAC Insurance Company Online Inc.’s motion for summary judgment, defendants’ motion is granted.