author: BUTTS, RJt

text:
    Juna v. Reis

      C.P. of Lycoming County,
    No. 11-02263
    C. Brian Crane, for plaintiffs.

      James D Casale, for defendants.

      September 10, 2013-
   BUTTS, RJt

Background

William Jamack (decedent) lived with and had a relationship with Denise Reis (defendant) at the time of his death on December 27, 2011. The decedent’s last will and testament left his entire estate to his daughter, Elizabeth Juna (plaintiff/estate). Following the decedent’s death, the defendant refused to give the estate several items in her possession, including a Rolex watch. The defendant notified the plaintiff that the decedent had given the defendant’s son the Rolex watch as a gift prior to his death.

As a result of the defendant’s refusal to turn over requested items, the estate filed the current civil action against the defendant. On July 23, 2013, this court held a pre-trial conference in this matter. At the request of the parties the issues were to be briefed and this court was to issue a decision prior to the non-jury trial, which has been scheduled for September 11, 2013 before the Honorable Richard A. Gray.

Discussion

The plaintiff contends that testimony by the defendant and her son would be precluded under the “the Dead Man’s Rule.” The Rule is embodied under 42 Pa.C.S. § 5930:

Except as otherwise provided in this subchapter, in any civil action or proceeding, where any party to a thing or contract in action is dead, or has been adjudged a lunatic and his right thereto or therein has passed, either by his own act or by the act of the law, to a party on the record who represents his interest in the subject in controversy, neither any surviving or remaining party to such thing or contract, nor any other person whose interest shall be adverse to the said right of such deceased or lunatic party, shall be a competent witness to any matter occurring before the death of said party or the adjudication of his lunacy, unless the action or proceeding is by or against the surviving or remaining partners, joint promisors or joint promises, of such deceased or lunatic party, and the matter occurred between such surviving or remaining partners, joint promisors or joint promises and the other party on the record, or between such surviving or remaining partners, promisors or promises and the person having an interest adverse to them, in which case any person may testify to such matters; or, unless the action is a possessoiy action against several defendants, and one or more of said defendants disclaims of record any title to the premises in controversy at the time the suit was brought and also pays into court the costs accrued at the time of his disclaimer, or gives security therefor as the court in its discretion may direct, in which case such disclaiming defendant shall be a fully competent witness; or, unless the issue or inquiry be devisavit vel non, or be any other issue or inquiry respecting the property of a deceased owner, and the controversy is between parties respectively claiming such property by devolution on the death of such owner, in which case all persons shall be fully competent witnesses.

Based upon this statute, Pennsylvania courts have determined that a witness is not competent to testify if three conditions have been satisfied: “(1) the deceased must have had an actual right or interest in the matter at issue, i.e. an interest in the immediate result of the suit; (2) the interest of the witness — not simply the testimony — must be adverse; and (3) a right of the deceased must have passed to a party of record who represents the deceased’s interest.” Hendrickson Estate, 130 A.2d 143, 146-47 (Pa. 1957). “The party challenging the competency of a witness has the burden of proving incompetency.” Estate of Rider, 409 A.2d 397, 399 (Pa. 1979).

In Hendrickson Estate, the defendant alleged that a ring was given to her by the decedent and that it belonged to her. Hendrickson Estate, 130 A.2d at 145. The Supreme Court of Pennsylvania found that the defendant’s testimony was incompetent:

The present controversy is between decedent’s personal representative and decedent’s daughter, each asserting ownership of the ring. Decedent — the purchaser and longtime possessor of the ring when he died — had at least a prima facie interest in the ring. Claimant’s interest is adverse to decedent, i.e., she claims the ring belonged to her, not to decedent. Applying the test in Dillon’s Estate, if appellant’s exception were sustained and her claim allowed, she would gain as the ‘direct legal operation and effect of the judgment’ by receiving ownership and possession of the ring. Whatever right decedent had in the ring passed to his executor who represents his interest as a party of record. Appellant’s testimony was properly excluded and such exclusion related not only to testimony as to transactions between appellant and her deceased father, but also as to any matter occurring before her father’s death which had any bearing on the ring transaction.

Id. at 147.

Many additional issues arise with “the Dead Man’s Rule,” including whether the witness’ interest is adverse to the decedent. Courts have allowed testimony if the witness does not have any interest in a claim and is merely testifying regarding an agreement with the decedent and the defendant. In Edmundson’s Estate, the Pennsylvania Supreme Court allowed the defendant’s mother to testify regarding an oral contract made with the decedent, because the beneficiary of the contract was not the mother but her daughter. Edmundson’s Estate, 103 A. 277, 279 (Pa. 1918). The reasoning is further explained in Billow.

To render a witness incompetent under the Act of 1887 it is not enough that he be a surviving or remaining party to the contract, but, in addition, his interest must be adverse to that of the deceased; it is the existence or non-existence of the adverse interest that is that test of his competency. In applying that test, adverse interest must not be confused with adverse testimony; it is the former, not the later that disqualifies. The mere fact that a witness, for personal reasons, may be unfriendly to the decedent’s cause and partial to that of his adversary is wholly immaterial, for, while that circumstance may affect his credibility, it has nothing to do with his competency.

Billow v. Billow, 61 A.2d 817, 818-19 (Pa. 1948) (citations omitted) (emphasis included); see also Weaver v. Welsh, 191 A. 3 (Pa. 1937) (“The close relationship between the witness and the beneficiary was not sufficient to make his interest adverse to that of decedent”), overruled on other grounds by Estate of Grossman, 406 A.2d 726 (Pa. 1979).

Here, the application of “the Dead Man’s Rule” is different between the defendant and the defendant’s son. The defendant’s son has an interest that is clearly adverse to that of the decedent. The defendant’s son states that the decedent gave him the Rolex watch as a gift; while the estate, which represents the decedent’s interest, argues that the watch was personal property of the decedent. The defendant argues that because her son was in possession of the Rolex watch he is allowed to testify to what decedent told him. The defendant cites Miller in support; however, the court finds that this case applies to the limited situation where an individual is in possession of a stock certificate with a blank endorsement. In re Estate of Miller, 346 A.2d 761 (Pa. 1975) (applying Donsavage Estate, 218 A.2d 112 (Pa. 1966)). The court finds that the facts in Hendrickson are controlling and the defendant’s son is incompetent to testify pursuant to 42 Pa.C.S. § 5930. Hendrickson’s Estate, 130 A.2d at 147 (where the defendant stated that a ring that the decedent purchased and possessed for a long time actually belonged to her).

The defendant, however, does not have the same interest in the Rolex watch as her son. It is alleged that the decedent gave the Rolex watch to the defendant’s son as a gift. The defendant would not have any interest in the watch and would not stand to personally gain or lose by the outcome of a ruling. The estate argues that “[t]he interest of the Defendant and the Defendant’s son are both adverse to the Estate.” Plaintiff’s brief to preclude at ¶ 9. As cited above, cases have already determined that a child’s adverse interest not does not render a parent’s or a relative’s testimony incompetent. See Edmundson’s Estate, 103 A. 277 (Pa. 1918); Weaver v. Welsh, 191 A. 3 (Pa. 1937); Estate of Hines, 2004 Phila. Ct. Com. Pl. LEXIS 132 (Pa. C.P. 2004); Pavlinko Estate, 160 A.2d 554 (Pa. 1960). In addition, the Supreme Court of Pennsylvania has similarly found that the testimony of the spouse of a surviving interested party is not per se incompetent under the Dead Man’s Rule. See Estate of Grossman, 406 A.2d at 732-33. Based on the facts set forth in the parties’ briefs, the court finds that the defendant is not incompetent to testify regarding the decedent’s gift to her son. The defendant does not have an adverse interest against the estate. Rather, the defendant’s assumed partiality toward her son’s interest is a factor to be considered by the trier of fact to determine credibility.

The estate raised an additional issue in their brief that the defendant should be precluded from asserting counterclaims pursuant to the Honorable Richard A. Gray’s order dated May 21, 2012. The order specifically states that the “Defendant shall file an amended counterclaim within twenty (20) days.” As stated by the civil non-jury pre-trial conference order, this court is only addressing the issue of the Dead Man’s Law so that the Honorable Richard A. Gray may preside over the trial. This court will not address additionally raised issues.

ORDER

And now, this day of September, 2013, based upon the foregoing opinion, the estate’s motion to preclude is hereby granted in part and denied in part. This court finds that the defendant’s son is incompetent to testify regarding the Rolex watch under the Dead Man’s Rule. The defendant herself, however, does not have an adverse interest against the decedent for the watch and is not precluded by the Dean Man’s Rule from testifying.


source: Caselaw Access Project

author: COX, J.,

license: Public Domain

text:
    McKay v. Roto-Rooter
    C.P. of Lawrence County,
    No. 10346 of 2012

      Daniel S. Soom, for plaintiff.

      Miles A. Kirshner, for defendant.

      September 24, 2013
   COX, J.,

Before the court for disposition is the motion for summary judgment filed on behalf of the defendant Roto-Rooter, which argues that the plaintiff has failed to produce evidence that the defendant had a duty to the plaintiff and, if so, the defendant’s employee breached that duty owed to the plaintiff by unplugging the plaintiff’s sump pump and instructing her to plug it in when the ground thawed. Moreover, the defendant contends that there was no causal connection between the actions of the defendant’s employee and the damage that resulted to the plaintiff’s basement.

The plaintiff resides at 1410 Chapin Road, New Castle, Lawrence County, Pennsylvania, where she also has a pole building to conduct her business known as Starbound Entertainment, which provides large character balloons for parades. On April 28,2000, the plaintiff hired B-Dry Company to install French drains in her basement to ensure that it would remain dry. B-Dry installed three sump pumps in the basement, which means they replaced the existing pump and installed two more. In the fall of 2010, the plaintiff contacted Roto-Rooter for service because there was an odor being emitted from her basement. Roto-Rooter sent Devin Mayhue on the service call to the plaintiff’s residence. He made visits to the plaintiff’s residence on November 15 and 16, 2010, and returned on December 9, 2010, to install a drainosaurus. According to the plaintiff, on the first visit, Mr. Mayhue discovered and removed a towel that was stuck in one of the sump pumps. The plainitff also recalled that Mr. Mayhue inspected the rest of the drainage system in the basement and he installed a new sump pump because the existing unit was burned out due to the towel being lodged in the sump pit. Conversely, Mr. Mayhue does not recall removing a towel from the sump pit. He stated that he removed the sump pump, was able to repair and reinstall the same. Mr. Mayhue provided the plaintiff with instructions on how to operate the drainage system, in which he informed her that the outlet pipe was frozen and the plaintiff should leave the sump pump unplugged until the ground thawed in the spring because the sump pit was full of water and it would activate the pump causing it to run constantly. The plaintiff informed Mr. Mayhue that she would be travelling to North Carolina to participate in a diet program at Duke University for 60 or 63 days from January 25, 2011, until April 6, 2011. Mr. Mayhue then unplugged the sump pump and informed her to leave it that way until the ground thaws. Mr. Mayhue was concerned that the sump pump would be activated and it would not be able to drain the water because of the frozen outlet pipe. That would cause the pump to constantly run and bum out. Mr. Mayhue left the sump pump unplugged and the plaintiff later went to North Carolina. No one checked on the interior of the residence while the Plaintiff was away. When she returned on April 6, 2011, there were 17 inches of water in her basement.

The plaintiff filed suit claiming that the defendant was negligent by failing to properly train its employees, failing to properly advise customers on how to operate the pumps they install and by advising the plaintiff to leave the sump pump unplugged until the ground thawed in the spring of 2011. On June 5, 2013, the defendant filed a motion for summary judgment, which argues that the plaintiff has failed to produce evidence that the defendant owed the plaintiff a duty and the defendant’s employee breached any duty owed to the plaintiff by unplugging the plaintiff’s sump pump and instructing her to plug it in when the ground thawed. Additionally, the defendant contends that there was no causal connection between the actions of the defendant’s employee and the damage that resulted to the plaintiff’s basement.

The purpose of the summary judgment rule is to eliminate cases prior to trial where a party cannot make out a claim or defense after the relevant discovery has been completed. Miller v. Sacred Heart Hospital, 753 A.2d 829 (Pa. Super. 2000). Any party may move for summary judgment in whole or in part as a matter of law whenever there is no genuine issue of any material fact as to a necessary element of the cause of action or defense which could be established by additional discovery or expert report or if, after the completion of discovery relevant to the motion, including the production of expert reports, an adverse party who will bear the burden of proof at trial has failed to produce evidence of facts essential to the cause of action or defense which in a jury trial would require the issues to be submitted to a jury. Pa.R.C.P. No. 1035.2.

Summary judgment may be granted only in cases where it is clear and free from doubt that there is no genuine issue as to any material fact and that the moving party is entitled to a summary judgment as a matter of law. Kafando v. Erie Ceramic Arts Co., 764 A.2d 59, 61 (Pa. Super. 2000) (citing Rush v. Philadelphia Newspapers, Inc., 732 A.2d 648, 650-651 (Pa. Super. 1999)). The moving party bears the burden of proving the non-existence of any genuine issue of material fact. Id. A material fact, for summary judgment purposes, is one that directly affects the outcome of the case. Gerrow v. Shincor Silicones, Inc., 756 A.2d 697 (Pa. Super. 2000). The non-moving party must adduce sufficient evidence on issues essential to his case on which he bears the burden of proof such that a jury could return a verdict in his favor. Failure to adduce this evidence establishes that there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Ertel v. Patriot-News Company, 544 Pa. 93, 674 A.2d 1038 (1996), reargument denied, (1996), certiorari denied, 519 U.S. 1008 (1996).

When determining whether to grant a motion for summary judgment, the court must view the record in the light most favorable to the non-moving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party. Hughes v. Seven Springs Farm, Inc., 563 Pa. 501, 752 A.2d 339 (2000). Summary judgment is proper only when the uncontroverted allegations in the pleadings, depositions, answers to interrogatories, admissions of record, and submitted affidavits demonstrate that no genuine issue of material fact exists, and that the moving party is entitled to judgment as a matter of law. P.J.S. v. Pennsylvania State Ethics Comm’n., 555 Pa. 149, 153, 723 A.2d 174, 175 (1999). Only when the facts are so clear that reasonable minds cannot differ, a trial court may properly enter summary judgment. Basile v. H&R Block, 716 A.2d 1115 (Pa. Super. 2001). If there are no genuine issues of material fact in dispute or if the non-moving party has failed to state a prima facie case, summary judgment may be granted. Dudley v. USX Corporation, 414 Pa. Super. 160, 606 A.2d 916 (1992). Thus, a proper grant of summary judgment depends upon an evidentiary record that either (1) shows the material facts are undisputed or (2) contains insufficient evidence of facts to make out a prima facie cause of action or defense. Rauch v. Mike-May er, 783 A.2d 815 (Pa. Super. 2001).

The trial court must confine its inquiry when confronted with a motion for summary judgment to questions of whether material factual disputes exist. Township of Bensalem v. Moore, 152 Pa. Cmwlth. 540, 620 A.2d 76 (1993). It is not the function of the Court ruling on a motion for summary judgment to weigh evidence and to determine the truth of the matter. Keenheel v. Pennsylvania Securities Commission, 143 Pa. Cmwlth. 494, 579 A.2d 1358 (1990).

In order to establish a claim for negligence, a plaintiff must prove the following elements: “(1) the defendant owed a duty to the plaintiff; (2) the defendant breached that duty; (3) a causal relationship between the breach and the resulting injury suffered by the plaintiff; and (4) actual loss suffered by the plaintiff.” Reeves v. Middletown Athletic Ass’n, 866 A.2d 1115, 1126 (Pa. Super. 2004) (citing Burman v. Golay & Co., Inc., 420 Pa. Super. 209, 616 A.2d 657 (1992)). In a negligence action, the plaintiff must prove that the defendant owed the plaintiff a duty of care and that duty was breached. Gutteridge v. A.P. Green Services, Inc., 804 A.2d 643, 655 (Pa. Super. 2002) (citing Ney v. Axelrod, 723 A.2d 719, 721 (Pa. Super. 1999)). The court must examine whether the defendant has an obligation for the benefit of that particular plaintiff and if that does not exist or had not been breached, there can be no cause of action for negligence. Minnich v. Yost, 817 A.2d 538, 541 (Pa. Super. 2003) (quoting J.E.J. v. TriCounty Big Brothers/Big Sisters, 692 A.2d 582, 584 (Pa. Super. 1997)). A plaintiff’s negligence claim is legally insufficient if he or she fails to state facts upon which the law imposes a duty upon the defendant in favor of that plaintiff. Boyce v. U.S. Steel Corp., 446 Pa. 226, 230, 285 A.2d 459, 461 (1971) (citing Yania v. Bigan, 397 Pa. 316, 155 A.2d 343 (1959); Neyman v. Soutter, 205 Pa. Super. 8, 205 A.2d 685 (1964)). The existence of a duty is based upon a question of fairness, an inquiry which involves weighing the relationship of the parties, the nature of the risk and the public interest. Campo v. St. Luke’s Hosp., 755 A.2d 20, 24 (Pa. Super. 2000) (quoting Brandjord v. Hopper, 455 Pa. Super. 426, 429-431, 688 A.2d 721, 723 (1997)).

The plaintiff also bears the burden to demonstrate that the defendant caused the harm alleged in the complaint. Under Pennsylvania law, a plaintiff must establish that the defendant’s action was a substantial factor in bringing about the harm incurred. Mahon v. W.C.A.B. (Expert Window Cleaning and State Workers’ Insurance Fund), 835 A.2d 420, 428 (Pa. Cmwlth. 2003) (citing Smith v. Philadelphia Transportation Co., 202 Pa. Super. 278, 195 A.2d 168, 170 (1963)). “Two or more causes may contribute to and thus be the legal or proximate cause of an injury. To determine if an intervening force is a superseding cause, ‘the test is whether the intervening conduct was so extraordinary as not to have been reasonably foreseeable.’” Feeney v. Disston Manor Personal Care Home, Inc., 849 A.2d 590, 595 (Pa. Super. 2004) (quoting Powell v. Drumheller, 539 Pa. 484, 653 A.2d 619, 623 (1995)). “In determining whether a factual cause is a legal cause, the jury must consider many elements, including intervening natural events, the passage of time, intervening actors, and the conduct of the injured party.” Van Buskirk v. Carey Canadian Mines, Ltd., 760 F.2d 481, 494 (3d Cir. 1985). It is important to note that determining causation is an issue for the jury to decide, unless the evidence is such that reasonable people cannot disagree. Kirschner v. K& L Gates LLP, 46 A.3d 737, 754 (Pa. Super. 2012) (citing Curran v. Stradley, Ronon, Stevens & Young, 361 Pa. Super. 17, 521 A.2d 451, 455 (1987)).

Expert testimony is employed to aid jurors in understanding issues and evidence that are beyond the scope of the average juror’s normal realm of experience. Young v. Com., Dept. of Transp., 560 Pa. 373, 376, 744 A.2d 1276, 1278 (2000). “If all primary facts can be accurately described to a jury and if the jury is as capable of comprehending and understanding such facts and drawing correct conclusions from them as are witnesses possessed of special training, experience or observation, then there is no need for the testimony of an expert. ” Reardon v. Meehan, 424 Pa. 460, 465, 227 A.2d 667, 670 (1967) (citing Salem v. United States Lines Co., 370 U.S. 31, 82 S.Ct. 1119, 8 L. Ed. 2d 313 (1962)). “The employment of testimony of an expert rises from necessity, a necessity born of the fact that the subject matter of the inquiry is one involving special skills and training beyond the ken of the ordinary layman.” Ld. (citing Weisman v. Sauder Chevrolet Co., 402 Pa. 272, 167 A.2d 308 (1961); Jemison v. Pfeifer, 397 Pa. 81, 152 A.2d 697 (1959); Delair v. McAdoo, 324 Pa. 392, 188 A. 181 (1936)). Expert testimony is proper where the expert witness does not intrude upon the province of the jury and it is a field where only special knowledge and training would allow a person to reach a sound conclusion. Id., 424 Pa. at 466, 227 A.2d at 660. In Carpenter v. Pleasant, 759 A.2d 411 (Pa. Cmwlth. 2000), the court determined that it was necessary to have an expert testify regarding the operation of mechanical devices that monitors traffic lights to avoid double green situations as it was a subject area that required specialized skill, training, knowledge and experience to help educate the jury as to whether the implementation of that device could have prevented the accident in question.

In the case sub judice, the defendant owed the plaintiff a duty as it is in the business of repairing and installing drainage systems similar to the one located in the plaintiff’s basement. The plaintiff employed the defendant to repair her drainage system as there was a foul odor emitted from her basement. The defendant sent Devin Mayhue to diagnose the problem and make any necessary repairs, which he attempted to do by repairing the sump pump that was not operating correctly. However, upon repairing the sump pump, he did not plug it in due to a frozen outlet pipe and informed the plaintiff to keep it unplugged until the ground thawed. It is apparent that the defendant had a duty to properly repair the plaintiff’s drainage system as that was the task it was hired to perform.

The plaintiff contends that Roto-Rooter breached its duty because its employee, Mr. Mayhue, installed a new sump pump but left the same unplugged with the instructions to plug it in when the ground thaws. Mr. Mayhue insisted that the outlet pipe was frozen and water in the sump pit would cause the sump pump to run constantly, which could bum out the unit. As a result, the plaintiff left the sump pump unplugged for the duration of her lengthy trip to North Carolina. The plaintiff failed to ask someone to check her house or plug in the sump pump when the weather warmed and the ground thawed, even though Mr. Mayhue instructed her to plug in the pump during the spring-time. While she was in North Carolina, the ground thawed and 17 inches of water accumulated in the plaintiff’s basement. The plaintiff contends that Mr. Mayhue provided her with incorrect information regarding the necessity of leaving the sump pump unplugged until the ground thawed. However, the plaintiff failed to provide any expert testimony to substantiate that claim. The operation of a sump pump and the necessity of leaving this particular sump pump unplugged until the ground thawed is a mechanical issue that is highly technical and beyond the scope of knowledge and experience of a lay person. Whether the sump pump would have run constantly causing a risk of fire or if the sump pump should have remained plugged in and would have operated correctly cannot be decided based upon lay testimony. It is necessary to provide expert testimony to explain how a sump pump operates and the proper use of a sump pump when the outlet pipe is constructed near the surface of the ground and is frozen. In fact, the plaintiff testified, in her deposition, that she did not realize there may have been a problem with the instructions provided to her by Mr. Mayhue until she spoke with an acquaintance, who worked in construction. He informed her that the water in her basement was caused by the sump pump not being plugged in when the ground thawed. Clearly, she needed to be informed by someone with more knowledge on the subject than herself to reach the conclusion that Mr. Mayhue and the defendant were negligent. Similarly, a jury would need the same information provided by an expert witness to aid in their determination. The only testimony provided to this court regarding the propriety of unplugging the sump pump by someone with knowledge of how drainage systems operate was supplied by Mr. Mayhue, who stated that it was proper to unplug the sump pump until the ground thawed. Therefore, the plaintiff has failed to provide adequate testimony to create a question of fact as to whether Roto-Rooter had a duty to act differently by plugging in the sump pump Mr. Mayhue repaired in the plaintiff’s basement.

In regards to the issue of causation, the court is not required to address that issue at the current time because it has determined that the plaintiff has failed to demonstrate that the defendant breached a duty it owed to the plaintiff.

For the reasons set forth in this opinion, the defendant’s motion for summary judgment is granted.

ORDER OF COURT

Now this 24th day of September, 2013, this case being before the court on August 26,2013, for oral argument on the motion for summary judgment filed by the defendant, with both parties appearing through their counsel, the plaintiff Toni McKay, represented through counsel, Daniel S. Soom, Esquire and the defendant Roto Rooter, represented through counsel, Miles A. Kirshner, Esquire and after a consideration of the arguments and briefs presented and submitted by counsel and a complete and thorough review of the applicable record, the court enters the following order and it is hereby ordered, adjudged and decreed as follows:

1. The motion for summary judgment filed by the defendant is hereby granted.

2. The prothonotary of Lawrence County is directed to enter summary judgment in favor of the defendant Roto Rooter and against the plaintiff Toni McKay.

3. The complaint filed by the plaintiff is hereby dismissed.

4. The prothonotary is directed to serve a copy of this order of court upon counsel of record, Daniel S. Soom, Esquire and Miles A. Kirshner, Esquire.

      . The period of time from January 25, 2011 to April 6, 2011 is actually 71 days.

      . It must be noted that there are no allegations of water trouble in the basement from November 16,2010, until January 25,2011, when the plaintiff departed for North Carolina.


author: NEALON, J.,

text:
    Thattayathu v. Trikha

      C.P. of Lackawanna County,
    No. 12 CV 3208

      Paul G. Batyko, for plaintiff.

      Paul J. Walker, for defendants Kallickal and Mani.

      Christopher P Amone and Siddharth G. Dubai, for defendants Trikha and Subh-Laxmi Corp.
    October 1, 2013
   NEALON, J.,

Plaintiff contributed $65,000.00 to a closely held cooperation that was formed to acquire a gas station and convenient store business, and after that proffered purchase proved to be unsuccessful, plaintiff sued the corporation’s majority shareholders and the intended seller for compensatory and punitive damages. The jury found the majority shareholders liable for breach of contract and awarded $40,000.00 in damages against them, and further awarded $125,000.00 in compensatory damages against the seller on an unjust enrichment theory. The jury did not find the seller liable in tort, nor did it award punitive damages against any defendant. The seller filed a post-trial motion seeking judgment in his favor on the unjust enrichment claim, and alternatively requesting either a new trial on damages or a remittitur of the award against him to $25,000.00. Plaintiff filed his own post-trial motion seeking to recover pre-verdict interest and post-verdict interest on the jury awards.

Since the trial record contains sufficient evidence that no express contract existed between plaintiff and the seller, that plaintiff delivered funds directly to the seller, and that the seller accepted and retained those funds under circumstances where it would be inequitable for the seller to keep that money, the seller’s motion for judgment notwithstanding the verdict will be denied. However, once the jury found the majority shareholders liable for $40,000.00 and concluded that the seller had not committed a tort and was not liable for punitive damages, the maximum amount of compensatory damages that the jury could award against the seller was $25,000.00. Therefore, the seller’s motion for remittitur will be granted and plaintiff will be afforded the option of accepting a remitted award of $25,000.00 against the seller or submitting to a new trial on damages against the seller only. Additionally, plaintiff’s post-trial motion for pre-verdict and post-verdict interest on his compensatory damages awards will be granted.

I. FACTUAL BACKGROUND

This litigation arises out of an ill-fated attempt by plaintiff, Joy Thattayathu (“Thattayathu”), and defendants, Sogi Kallickal (“Kallickal”) and Mathew Mani (“Mani”), to purchase a gas station and convenient store business from defendant, Manmohan Trikha (“Trikha”), and in the process, to secure a long-term lease of real estate located at 300 Meadow Avenue, Scranton. In 2009, Trikha owned and operated six gas stations and convenient stores in the Lackawanna County, including a gas station and convenient store at 300 Meadow Avenue. (Transcript of proceedings (“T.P.”) on4/16/13 atpp. 183, 206, 220, 233; T.P. 4/17/13 at p. 146). The land at 300 Meadow Avenue was owned by Lake Street Acquisition Corp., and Trikha’s wholly owned company, defendant, Subh-Laxmi Corp (“Subh-Laxmi”), leased that property from Lake Street Acquisition Corp., and operated its gas station and convenient store at that site. (T.P. 4/17/13 atpp. 122-124, 139).

In late 2009, Mani approached Trikha regarding the possible purchase of the gas station and convenient store business, and the concomitant procurement of a long term lease of the land, at 300 Meadow Avenue. (Id. at pp. 120, 124-125). Mani indicated that he was soliciting potential investors to raise the necessary funds for such a transaction, and Trikha and Mani eventually agreed to a purchase price of $290,000.00, with $150,000.00 of that amount being “owner financed” by Trikha. {Id. at pp. 116-117, 125-126, 132). Mani discussed this prospective transaction with Kallickal who, in turn, contacted his cousin, Thattayathu, to solicit his investment in a newly formed company which would purchase Trikha’s business and acquire a twenty year lease to operate that business at the 300 Meadow Avenue location. (T.P. 4/16/13 at pp. 3, 7-8, 19-20; T. P. 4/17/13 at pp. 20-21).

To that end, Kallickal, Mani, Thattayathu and Jose Makil formed JMJMS, Inc. (“JMJMS”), with Thattayathu and Jose Makil each acquiring two hundred (200) shares of stock and Kallickal and Mani each obtaining two hundred fifty five (255) shares of stock in JMJMS. (T.P. 4/15/13 at pp. 158-159; T.P. 4/16/13 at pp. 27-28, 62, 144-145). Kallickal served as the president, secretaiy and treasurer of JMJMS. (T.P. 4/16/13 at pp. 25-26). In addition to borrowing smaller sums of money from friends to generate the funds to purchase Trikha’s business and to obtain a long term lease of 300 Meadow Avenue, Kallickal and Manu advised Thattayathu to contribute $65,000.00 toward that venture. (T.P. 4/15/13 at pp. 203-204; T.P. 4/16/13 at pp. 9, 41-42). Kallickal and Mani each agreed to contribute $75,000.00, and continued to borrow funds from friends in order to raise that $150,000.00. (T.P. 4/16/13 at pp. 35-38, 166-167).

It is undisputed that in early 2010, Thattayathu contributed $65,000.00 in the following four payments: $10,000.00 to Mani; $25,000.00 to Trikha; $5,000.00 to Mani; and $25,000.00 to Kallickal. (T.P. 4/15/13 at pp. 120-121, 130-131, 136, 195-197; T.P. 4/16/13 at pp. 16-17, 34, 58-59, 65, 132; T.P. 4/17/13 atpp. 12-14, 24, 31, 38, 93-94). Kallickal and Mani provided Trikha with $50,000.00 in funds that they had borrowed from friends, and when coupled with Thattayathu’s $25,000.00 payment to Trikha, delivered $75,000.00 in total funds to Trikha. (T.P. 4/15/13 atpp. 125, 129, 133, 136; T.P. 4/16/13 atpp. 16-17,128-129,178,184,197-198; T.P. 4/17/13 atpp. 69-60). In exchange for the payment of that amount, Trikha’s company, Subh-Laxmi, agreed to enter into a twenty year lease agreement with Kallickal’s company, 5’s, Inc. (“5’s”), which, in turn, would sub lease the property to JMJMS so that the gas station and convenient store could be operated there. (T.P. 4/15/13 atpp. 138-140, 157, 160-162, 165,198-199; T.P. 4/16/13 atpp. 64, 80-81,139-140, 143-144, 146-149, 163; T.P. 4/17/13 atpp. 80-81).

Unbeknownst to Thattayathu, Kallickal and Mani had used the $40,000.00 that they had received from Thattayathu to repay those individuals that had loaned them money to form JMJMS, but who had not received shares of stock in JMJMS. (T.P. 4/16/13 at pp. 10, 12, 17-18, 25, 33, 60-61, 89, 99-100, 165-166). Additionally, Kallickal and Mani discovered in February 2010 that the property owner, Lake Street Acquisition Corp., had defaulted on its mortgage with Fidelity Deposit and Discount Bank, and that a Sheriff’s Sale of the property had been scheduled for June 1, 2010. (T.P. 4/15/13 at pp. 140-144, 166, 170). JMJMS and Trikha attempted to negotiate and consummate a temporary lease of Trikha’s business for the period from March 15, 2010, to May 31, 2010, but were unable to reach an agreement. (T.P. 4/15/13 atpp. 140-144, 150, 166, 173).

Due to their concerns that Trikha and Subh-Laxmi would be unable to transfer a twenty year lease for the Meadow Avenue real estate if that property was sold to a third party at the scheduled Sheriff’s Sale, Thattayathu, Kallickal and Mani agreed that Trikha would utilize the funds that he had received from those JMJMS shareholders in order to purchase the property at the Sheriff’s Sale. (T.P. 4/15/13 at pp. 146-147, 149, 192-195; T.P. 4/16/13 at pp. 20-21, 24-25, 89-90, 187-188; T.P. 4/17/13 at 112-113). Trikha agreed that if he was not the successful bidder for 300 Meadow Avenue at the Sheriffs Sale, he would refund the $75,000.00 to JMJMS and its shareholders. (T.P. 4/15/13 atpp. 144,149,192-195; T.P. 4/16/13 atpp. 20-21,24-25, 89-90; T.P. 4/17/13 atpp. 113-114). Unfortunately, Trikha was not the high bidder for the property at the Sheriffs Sale, (T.P. 4/16/13 a pp. 97-98, 100, 108, 178-179; T.P. 4/17/13 at pp. 16, 26, 97-98, 133), and was unable to transfer a long term lease to JMJMS since Subh-Laxmi’s lease ceased in July 2010. (T.P. 4/17/13 at pp. 104-105, 135).

Prior to the Sheriff’s Sale on June 1, 2010, Trikha had advised Kallickal, Mani and JMJMS’s counsel, Raymond Ferrario, Esquire, that he would return the $75,000.00 which Kallickal, Mani and Thattayathu had provided to him. (T.P. 4/15/13 atpp. 152-153; T.P. 4/17/13 atpp. 113-114). After Trikha failed to do so, JMJMS’s shareholders and counsel made repeated written and oral demands for the return of those funds, but to no avail. (T.P. 4/15/13 at pp. 152-156, 173-174, 186-187; T.P. 4/16/13 at pp. 90-91, 210; T.P. 4/17/13 at pp. 77, 105-106). Consequently, Thattayathu commenced this action against Trikha, Subh-Laxmi, Kallickal and Mani seeking to recover compensatory and punitive damages. (Docket entry no. 1).

At the time of trial, Kailickal and Mani acknowledged that Thattayathu is entitled to be repaid the $65,000.00 that he delivered to Trikha, Mani and Kallickal in connection with JMJMS’s aborted acquisition of Trikha’s business and Subh-Laxmi’s lease, but both men maintained that they are unable to return those funds to Thattayathu until Trikha refunds the $75,000.00 that Kallickal, Mani and Thattayathu provided to him. (T.P. 4/16/13 at pp. 29-31,37-40,42,90,95, 104, 126-127,131,134-135, 170-171). During his trial testimony, Trikha offered three different explanations as to why he has not repaid the $75,000.00 to Kallickal, Mani and Thattayathu. First, he claimed that the $75,000.00 payment “was a non-returnable deposit” on the purchase of his business and the acquisition of a long term lease. (T.P. 4/16/13 at p. 189). However, Trikha later testified that the $75,000.00 payment “wasn’t [a] deposit” and instead was for the cost of repairs that were made to the gas station and convenient store with the alleged consent of Kallickal, Mani and Thattayathu. (Id at pp. 199-201, 206-207, 211). After JMJMS’s counsel rebutted that claim during his testimony, (T.P. 4/17/13 at pp. 106-110), Trikha was recalled as a witness by his counsel, revised his version of events again, and contended that the $75,000.00 payment represented the aggregate cost of the convenient store inventory and some minor repairs that were performed. (Id. atpp. 145 — 146).

Thattayathu asserted claims against Kallickal and Mani for breach of contract, breach of fiduciary duty, fraud, and civil conspiracy. (Id. atpp. 191-195,197-198). Thattayathu advanced claims against Trikha for unjust enrichment and civil conspiracy. (Id. at pp. 196-198). Thattayathu sought to recover compensatory damages of $65,000.00, and also demanded, in the event that Trikha, Kallickal or Mani were found to be liable in tort, punitive damages from the culpabletortfeasor(s). (Id. atpp. 198-200).

The jury found Kallickal and Mani both liable for breach of contract, and awarded damages of $25,000.00 against Kallickal and $15,000.00 against Mani. (Id at p. 229). Although the jury also found Kallickal and Mani liable for breach of fiduciary duty, they awarded no damages for that tortious conduct. (Id. atpp. 229-230). The jury further determined that neither Kallickal nor Mani had committed fraud. (Id. atpp. 230-231).

With respect to Trikha, the jury found that Trikha had been unjustly enriched by Thattayathu and assessed the value of the benefit conferred upon him as $125,000.00. (Id. at p. 231). The juiy concluded that Trikha, Kallickal and Mani were not liable for civil conspiracy. (Id. at pp. 231-232). Since the jury found that Thattayathu had not suffered any harm as a result of any tortious conduct by Trikha, Kallickal or Mani, it declined to award any punitive damages. (Id. at p. 232). Thus, the jury awarded compensatory damages totaling $165,000.00, comprised of breach of contract awards against Kallickal and Mani for $25,000.00 and $15,000.00 respectively, and an unjust enrichment award against Trikha in the amount of $125,000.00. (Id.).

Trikha and Subh-Laxmi filed a timely motion for post-trial relief seeking the entry of judgment non obstante verdicto (“JNOV”) or the grant of a new trial or remittitur. In their request for JNOV, Trikha and Subh-Laxmi contend that “Thattayathu did not meet his burden of proof with respect to the unjust enrichment claim” since the only lease agreement that was executed identifies Subh-Laxmi and 5S’s as the contracting parties. (Docket entry no. 60 at ¶ 2 and p. 7). Trikha and Subh-Laxmi alternatively seek a new trial on the ground that “[t]he verdict of $125,000.00 against defendant Trikha for unjust enrichment was excessive” and “based upon prejudice or sympathy of the jury.” (Id. at ¶¶ 4-5). Trikha has also presented a motion seeking to remit the jury award against him to $25,000.00. (Id. at ¶¶ 6-7).

Thattayathu has filed a post-trial motion requesting the assessment of pre-verdict interest at the rate of 6% per annum from the date that repayment of his $65,000.00 became due through the date of the verdict on April 17, 2013. (Docket entry no. 62 at ¶¶ 12, 14, 16). Thattayathu further seeks to recover post-verdict interest at the statutory rate of 6% from April 17, 2013, through the date of final payment. (Id. at ¶¶ 13, 15, 17). At the time of oral argument on the parties’ post-trial motions on August 14, 2013, counsel for Trikha and Subh-Laxmi stated that in the event that Trikha’s motion for remittitur was granted, their motion for a new trial would be deemed withdrawn.

II. DISCUSSION

(A) STANDARD OF REVIEW

When considering a request for JNOV, the evidence must be viewed in the light most favorable to the verdict winner, who must be afforded the benefit of every reasonable inference arising from the trial evidence, while rejecting all unfavorable testimony and inferences. Empire Trucking Co. v. Reading Anthracite Coal Company, 71 A.3d 923, 932 (Pa. Super. 2013). “A JNOV can be entered upon two bases: (1) where the movant is entitled to judgment as a matter of law; and/or, (2) the evidence was such that no two reasonable minds could disagree that the verdict should have been rendered for the movant.” Zitney v. Appalachian Timber Products, Inc., 72 A.3d 281, 293 (Pa. Super. 2013). “With the first, a court reviews the record and concludes that even with all factual inferences decided adverse to the movant, the law nonetheless requires a verdict in his favor, whereas with the second the court reviews the evidentiary record and concludes that the evidence was such that a verdict for the movant was beyond peradventure.” Hall v. Episcopal Long Term Care. 54 A.3d 381, 395 (Pa. Super. 2012), app. denied, 69 A.3d 243 (Pa. 2013).

“There is a two step process that atrial court must follow when responding to a request for a new trial.” Huber v. Etkin, 58 A.3d 772, 776 (Pa. Super. 2012), app. denied, 68 A.3d 909 (Pa. 2013). First, the trial court must decide whether one or more mistakes occurred at trial. Braun v. Wal-Mart Stores. Inc., 24 A.3d 875, 891 (Pa. Super. 2011); White v. Behlke, 2009 WL 1904102, at * 15 (Lacka. Co. 2009), aff’d, 15 A.3d 523 (Pa. Super. 2010), app. denied, 614 Pa. 689, 39 A.3d 991 (2012). Second, if the trial court concludes that a mistake occurred, it must determine whether the mistake is a sufficient basis for granting a new trial. Locklev v. CSX Transportation, Inc., 5 A.3d 383, 388 (Pa. Super. 2010), app. denied, 613 Pa. 668, 34 A.3d 831 (2011). Under the harmless error doctrine, “[a] new trial is not warranted merely because some irregularity occurred during the trial or another trial judge would have ruled differently; the moving party must demonstrate to the trial court that he or she has suffered some prejudice from the mistake.” Bennett v. A. T Masterpiece Homes at Broadsprings, LLC, 40 A.3d 145, 149-150 (Pa. Super. 2012); Shields v. Fafard, 2013 WL 4542263, at * 6 (Lacka. Co. 2013).

(B) UNJUST ENRICHMENT CLAIM

Trikha first seeks the entry of judgment in his favor under Pa.R.C.P. 227.1(a)(2) with respect to Thattayathu’s cause of action for unjust enrichment. Trikha notes that the “[djoctrine of unjust enrichment does not apply where the parties’ relationship is founded on an express agreement,” and argues that Thattayathu cannot recover under that theory inasmuch as a lease agreement existed between Subh-Laxmi and 5S’s. (Docket entry no. 60 at p. 6). Thattayathu submits that when the record is viewed in the light most favorable to him as the verdict winner, sufficient evidence exists to support the jury’s unjust enrichment finding against Trikha. (Docket entry no. 64 at p. 7).

Unjust enrichment is considered to be an equitable doctrine. Com, v. Ortho-McNeil-Janssen Pharmaceuticals. Inc., 52 A.3d 498, 512 (Pa. Cmwlth. 2012). “The elements of unjust enrichment are benefits conferred on defendant by plaintiff; appreciation of such benefits by defendant; and acceptance and retention of such benefits under such circumstances that it would be inequitable for defendant to retain the benefit without payment of value.” Joyce v. Erie Insurance Exchange, 2013 WL 3421977, at *10 (Pa. Super. 2013); Reflection Builders Enterprise. Inc. v, Basile, 2012 WL 2115694, at * 6 (Lacka. Co. 2012). The plaintiff bears the burden of establishing either that the defendant wrongfully secured the benefit or passively received a benefit that it would be unconscionable to retain. OrthoMcNeil-Janssen Pharmaceuticals. Inc., supra (quoting Com, v. TAP Pharmaceutical Products, 885 A.2d 1127, 1137 (Pa. Cmwlth. 2005)). In determining whether the doctrine applies, the “focus is not on the intention of the parties, but rather on whether the defendant has been unjustly enriched.” Joyce, supra; Durst v. Milroy General Contracting. Inc., 52 A.3d 357, 360 (Pa. Super. 2012).

Where unjust enrichment is found, the law implies a contract, which requires the defendant to pay the plaintiff the value of the benefit that the plaintiff has conferred on the defendant. Ortho-McNeil-Janssen Pharmaceuticals, Inc., 52 A.3d at 512; Durst. 52 A.3d at 360. Thus, “[a] n action based on unjust enrichment is an action which sounds in quasi-contract or contract implied in law.” Discover Bank v. Stucka, 33 A.3d 82, 88 (Pa. Super. 2011) (quoting Sevast v. Kakouras, 591 Pa. 44, 53 n. 7, 951 A.2d 1147, 1153 n. 7 (2007)). Under the doctrine of unjust enrichment, the implied contract “imposes a duty, not as a result of any agreement, whether expressed or implied, but in spite of the absence of an agreement, when one party receives unjust enrichment at the expense of another.” Metrocluh Condominium Association v. 201-59 North Eighth Street Associates. L.P, 47 A.3d 137, 148 (Pa. Super. 2012), app. denied, 57 A.3d 71 (Pa. 2012); Discover Bank, supra. Consequently, a jury “may not make a finding of unjust enrichment... where a written or expressed contract between the parties exists.” Joyce, supra.

There is ample evidence in the record to support the conclusion that Thattayathu provided monies to Trikha, that Trikha appreciated that monetary benefit, and that Trikha retained such funds under circumstances where it would be unconscionable or inequitable for him to wrongfully retain those proceeds. (T.P. 4/15/13 atpp. 120-121,130-131,136,195-197; T.P. 4/16/13 atpp. 16-17, 34, 58-59, 65-132; T.P. 4/17/13 at pp. 12-14, 24, 31, 38, 93-94). In fact, Trikha himself admitted under oath that he received and deposited a check from Thattayathu in the amount of $25,000.00. (T.P. 4/16/13 at p. 178). Although Trikha proffered a series of conflicting explanations as to why he has not returned those funds to Thattayathu, (T.P. 4/16/13 atpp. 189, 199-201,206-207, 211; T.P. 4/17/13 at pp. 145-146), the jury was free to reject that testimony as not credible. See O’Kelly v. Dawson, 62 A.3d 414, 419 (Pa. Super. 2013) (questions concerning credibility of witnesses and weight to be accorded the evidence at trial are within the province of the jury, and when considering a motion for JNOV, “we will not substitute our judgment for that of the finder of fact.”).

A finding of unjust enrichment cannot survive if an express contract exists between the plaintiff and the defendant. See Joyce, supra. The only express agreement that Trikha has identified is the written lease between his company, Subh-Laxmi, and KallickaTs company, 5S’s. No express contract ever existed between Thattayathu and Trikha individually, nor did Trikha allege the existence of any such agreement at trial. Therefore, based upon the foregoing proof that Trikha has wrongfully retained a monetary benefit that Thattayathu conferred upon him, the law implied a contract which requires Trikha to pay Thattayathu the value of the benefit conferred.

The jury was presented with sufficient evidence from which it could conclude that Trikha was unjustly enriched by the money that he received from Thattayathu. Trikha has not established that the law “requires a verdict in his favor” or “that a verdict for [Trikha] was beyond peradventure.” As a result, his request for JNOV with regard to the jury’s finding of unjust enrichment will be denied.

(C) REMITTITUR REQUEST

Trikha alternatively argues that “[i]f this Court nonetheless finds that the evidence was sufficient to establish unjust enrichment of Trikha from Plaintiff, a remittitur is proper in this case.” (Docket entry no. 60 at p. 9). Trikha posits that the question submitted by the jury during its deliberations relative to the elements of a civil conspiracy claim reflected the jury’s desire to require Trikha to pay “$100,000.00 in punitive damages without any legal basis.” {Id. at ¶ 5). Since Thattayathu sought compensatory damages of $65,000.00, and the jury found Kallickal andMani liable for $40,000.00 ofthat sum, Trikha maintains that the unjust enrichment verdict against him must be remitted to $25,000.00. {Id. at p. 9). Thattayathu counters “that the jury weighed and considered which credible evidence to rely upon in assessing damages and determining that a verdict for $125,000.00 against Trikha was appropriate.” (Docket entry no. 62 at p. 11).

Judicial reduction of a juiy award is appropriate only when the award is plainly excessive and exorbitant Rettger v. UPMC Shadvside, 991 A.2d 915, 932 (Pa. Super. 2010), app. denied, 609 Pa. 698, 15 A.3d 491 (2011); Busy Bee. Inc. v. Wachovia Bank. N.A., 2006 WL 723487, at *65 (Lacka. Co. 2006), aff’d, 932 A.2d 248 (Pa. Super. 2007), app. denied, 598 Pa. 778, 959 A.2d 318 (2008). “A remittitur should fix the highest amount any jury could properly award, giving due weight to all the evidence offered.” Neal v. Bavarian Motors. Inc., 882 A.2d 1022, 1028 (Pa. Super. 2005), app. denied, 589 Pa. 722, 907 A.2d 1103 (2006); Busy Bee, Inc., supra. The question presented by a motion for remittitur “is whether the award of damages falls within the uncertain limits of fair and reasonable compensation or whether the verdict so shocks the sense of justice as to suggest that the jury was influenced by partiality, prejudice, mistake or corruption.” Renna v. Schadt, 64 A.3d 658, 671 (Pa. Super. 2013) (quoting Rettger, 991 A.2d at 932). If the verdict “bears a reasonable resemblance to the damages proven,” the reviewing court should not disturb it “merely because we might have awarded different damages.” McManamon v. Washko, 906 A.2d 1259, 1285 (Pa. Super. 2006), app. denied, 591 Pa. 736, 921 A.2d 497 (2007).

In connection with Thattayathu’s claim that Trikha, Kallickal and Mani engaged in outrageous tortious behavior warranting the imposition of punitive damages, Thattayathu introduced evidence of the counsel fees and litigation costs that he has incurred, the interest expenses that he has paid on a home equity loan used to finance his $65,000.00 contribution, lost revenue that he has sustained in his machinist business due to litigation and trial appearances, and travel and lodging expenses that he has incurred in traveling from his home in California to Lackawanna County for discovery depositions and trial. (T.P. 4/17/13 atpp. 9,14-19). The jury was instructed that it could award punitive damages only if it found one or more of the defendants liable in tort and further concluded that the culpable defendant(s) engaged in outrageous behavior. (Id. at pp. 188-191, 198-199). The only jury verdict interrogatories addressing potential tort liability on the part of Trikha were those questions concerning civil conspiracy. The jury was instructed that a civil conspiracy claim requires, inter alia, proof of “a combination of two or more persons acting with a common purpose to do an unlawful act, or to do a lawful act by unlawful means or for an unlawful purpose.” (Id. at pp. 186-187).

Nevertheless, during their deliberations, the jurors submitted a question which stated: “[c]an only one person be judged as having engaged in an overall civil conspiracy, or must it be two or more persons?” (Id. at pp. 227-228). The jurors were advised to reference the written jury instructions that had been distributed to them for their use during deliberations pursuant to Pa.R.C.P. 223.1(c)(4), and which stated that a civil conspiracy requires two or more persons. (Id. at p. 228). Since the jury did not find any of the defendants liable for civil conspiracy, nor did they conclude that any defendant acted outrageously, it declined to award punitive damages. (Id. at pp. 231-232).

The maximum amount of compensatoiy damages that Thattayathu could recover in this case was $65,000.00. The jury found Kallickal and Mani liable for breach of contract, and awarded Thattayathu damages of $25,000.00 against Kallickal and $15,000.00 against Mani. Although a defendant may be held jointly and severally liable in tort, and thereby required to pay the full amount of the verdict if that defendant is found “liable for not less than 60% of the total liability apportioned to all parties,” 42 Pa.C.S. § 7102(a.l)(3)(iii), Pennsylvania law does not recognize joint and several liability for damages awarded by a jury for breach of contract. See Kohn v. School District of City of Harrisburg, 2012 WL 1598096, at * 6 (M.D. Pa. 2012) (“A right to contribution does not exist on a breach-of-contract claim because the School District cannot establish joint tortfeasor status on such a claim.”); Castle Cheese. Inc. v. MS Produce. Inc., 2008 WL 4372856, at * 42 (W.D. Pa. 2008) (“Since the enactment of [Pennsylvania’s Uniform Contribution Among Tortfeasors Act], courts have consistently held that Pennsylvania does not recognize a right of contribution among defendants in breach of contract cases.”); Unique Technologies. Inc. v. Micro-Stamping Corp., 2003 WL 21652284, at * 3 (E.D. Pa. 2003) (“Unique cannot assert a legally permissible cause of action under Pennsylvania state law for contribution on a breach of contract case.”). See also Sehl v. Neff, 26 A.3d 1130, 1134 (Pa. Super. 2011) (tortfeasor and plaintiff’s own automobile insurer, against whom plaintiff had asserted breach of contract claim for uninsured motorist benefits, could not be held jointly and severally liable for tort and contract damages relating to the accident). Once the jury had awarded Thattayathu $40,000.00 in compensatory damages against Kallickal and Mani, it could only award $25,000.00 in compensatory damages against Trikha.

However, the jury found Trikha liable for $125,000.00 in damages for unjust enrichment. Trikha makes a plausible argument that the jury’s civil conspiracy question during deliberations reflected its desire to somehow find Trikha liable in tort and responsible for $100,000.00 in punitive damages. But, unless the jury found either Kallickal or Mani liable for engaging in a civil conspiracy with Trikha, it could not find Trikha liable in tort and award punitive damages against him. Rather, the “highest amount” it could award against Trikha, following the breach of contract awards totaling $40,000.00, was $25,000.00. For that reason, the jury award of $125,000.00 against Trikha shocks the sense of justice and suggests that the jury was influenced by partiality or prejudice towards Trikha.

Since the maximum amount of compensatory damages that the jury could have awarded against Trikha was $25,000.00, Trikha’s motion for remittitur will be granted. Under Pennsylvania law governing remittitur, Thattayathu has the option of accepting that remittitur to an award of $25,000.00 or, in the alternative, choosing to undergo anew trial on damages with respect to Trikha only. See Refuse Management Systems, Inc. v. Consolidated Recycling and Transfer Systems. Inc., 448 Pa. Super. 402, 421-422, 671 A.2d 1140, 1149 (1996): Osborne v. Neville, 102 Lacka. Jur. 132, 160 (2000), aff’d, 797 A.2d 381 (Pa. Super. 2002), app. denied, 569 Pa. 694, 803 A.2d 735 (2002). If Thattayathu files a remittitur of $100,000.00, reflecting a reduction in his unjust enrichment award against Trikha to $25,000.00, within twenty days of the date of this Order, Trikha’s motion for a new trial on damages will be denied. However, if Thattayathu declines to file such a remittitur within the next twenty days, Trikha’s motion for a new trial on damages will be granted. See Osborne, 102 Lacka. Jur. at 166-167.

(D) PRE-VERDICT AND POST-VERDICT INTEREST

Thattayathu has filed a post-trial motion seeking to recover pre-verdict and post-verdict interest at the rate of 6% per annum on the jury awards that he secured against Trikha, Kallickal and Mani. (Docket entry no. 62). Trikha, Kallickal and Mani did not file an answer to Thattayathu’s post-trial motion, nor have they submitted briefs in opposition to his request for interest.

Pennsylvania has adopted the “Interest as Damages” standard set forth in the Restatement (Second) of Contracts § 354 (1981), which was formerly found in the Restatement (First) of Contract § 337(a) (1932). See Fernandez v. Levin, 519 Pa. 375, 379, 548 A.2d 1191, 1193 (1988). Section 354(1) of the Restatement provides that “[i]f the breach consists of a failure to pay a definite sum in money or to render a performance with fixed or ascertainable monetary value, interest is recoverable from the time for performance on the amount due less all deductions to which the party in breach is entitled.” TruServ Corp. v. Morgan’s Tool & Supply Co., Inc., 614 Pa. 549, 566-567, 39 A.3d 253, 263 (2012) (quoting Restatement (Second) of Contract § 354(1)). “Section 354 distinguishes between interest due on an obligation to pay a definite sum, which is recoverable as a matter of right under Subsection 354(1), and interest on losses incurred as a consequence of a breach of a promise to pay, which is subject to discretion under Subsection 354(2).” Cresci Construction Services. Inc. v. Martin, 64 A.3d 254, 262 (Pa. Super. 2013).

In applying § 354(1) of the Restatement, the Supreme Court of Pennsylvania has stated that interest is automatically recoverable in certain contract actions regardless “of when it is demanded, [citation omitted], or whether it is demanded.” Fernandez, 519 Pa. at 380, 548 A.2d at 1193. Such an award of interest does not depend upon the discretion of the court, TruServ Corp., 614 Pa. at 568, 39 A.3d at 264, and is available as a matter of right “even though a bona fide dispute exists as to the amount of the indebtedness.” Younkin v. Nationwide Insurance Co., 807 A.2d 275, 281 (Pa. Super. 2002). The rationale underlying an award of prejudgment interest is “that the breaching party has deprived the injured party of using interest accrued on money which was rightfully due and owing to the injured party.” Portside Investors. L.P v. Northern Ins. Co. of New York, 41 A.3d 1, 15 (Pa. Super. 2011).

“The purpose of damages in a breach of contract case is to return the parties to the position they would have been in but for the breach.” Pittsburgh Const. Co. v. Griffith, 834 A.2d 572, 580 (Pa. Super. 2003), app. denied, 578 Pa. 701, 852 A.2d 313 (2004). The same reasoning is applicable to unjust enrichment claims seeking payment of a definite sum of money, such that pre-verdict interest is likewise recoverable on an unjust enrichment award. See Sack v. Feinman, 489 Pa. 152, 163, 413 A.2d 1059, 1065 (1980) (“Hence, any claim based upon unjust enrichment or restitution, rather than upon compensation or damages, not only permits pre-judgment interest, but also permits an award of compound interest.”); Kaiser v. Old Republic Insurance Company, 741 A.2d 748, 755 (Pa. Super. 1999) (“...it is nonetheless clear that pre-judgment interest may be awarded when a defendant holds money or property which belongs in good conscience to the plaintiff, and the objective of the court is to force disgorgement of his unjust enrichment.”). Pursuant to 41 P.S. § 202, the legal rate of interest is six percent per annum.

Thattayathu sought compensatory damages in a fixed, ascertainable sum (i.e., $65,000.00), as a result of which he is entitled to recover pre-verdict interest as a matter of right. See TruServe Corp., 614 Pa. at 568, 39 A.3d at 265 (“Thus, even where the terms of a contract do not expressly provide for the payment of interest, a nonbreaching party has a legal right to recover interest, as damages, on a definite sum owed under the contract.”); Cresci Const. Services. Inc., 64 A.3d at 264-265. In his post-trial motion, Thattayathu seeks to recover interest from the dates that Mani, Trikha and Kallickal first received funds from him on December 28, 2009, January 19, 2010, and February 23, 2010, respectively. (Docket entry no. 62 at ¶¶ 12, 14, 16). However, defendants were not obligated to repay Thattayathu’s $65,000.00 until Trikha failed to purchase the 300 Meadow Avenue property on June 1, 2010, and the long-term lease transaction was definitively aborted. Consequently, in 2010, Thattayathu is entitled to preverdict interest for the 213 day period from June 1, 2010, through December 31, 2010. Thattayathu may recover full years of statutory interest for 2011 and 2012. In 2013, Thattayathu is entitled to recover pre-verdict interest for the 107 day period from January 1,2013, through the date of the verdict on April 17, 2013.

With regard to Thattayathu’s $25,000.00 verdicts against Kallickal and Trikha, pre-verdict interest at 6% per annum yields an interest recovery of $1,500.00 per year, or $4.11 per day. The pre-verdict interest recovery relative to the $15,000.00 award against

Mani is $900.00 per year, or $2.47 per day. As a result, the verdicts against Trikha,

Kallickal and Mani, when molded to reflect pre-verdict interest, will include the following interest recoveries:

2010 2011 2012 2013 TOTAL

Trikha ($4.11/day) $875.43 $1,500.00 $1,500.00 $439.77 $4,315.20

Kallickal ($4.11/day) $875.43 $1,500.00 $1,500.00 $439.77 $4,315.20

Mani ($2.47/day) $526.11 $ 900.00 $ 900.00 $264.29 $2,590.40

Accordingly, the verdicts against Trikha and Kallickal will be molded to the sums of $29,315.20, while the verdict against Mani will be similarly molded to $17,590.40.

Thattayathu also seeks to recover post-verdict interest on the jury awards from April 17, 2013, to the date of payment. Section 8101 of the Judicial Code provides that “a judgment for a specific sum of money shall bear interest at the lawful rate from the date of the verdict, or from the date of the judgment, if the judgment is not entered upon a verdict or award.” 42 Pa. C.S. §,8101. For purposes of computing post-judgment interest, “judgment and verdict are synonymous, and the date from which interest accrues is the date of the verdict, not the date judgment is finally entered.” Hutchison v. Luddy, 946 A.2d 744, 750 (Pa. Super. 2008); Green Valley Dry Cleaners. Inc. v. Westmoreland County Industrial Development Corp., 861 A.2d 1013, 1016 (Pa. Cmwlth. 2004). Where the amount of the verdict is adjusted upward by the trial court, interest begins to run on the adjusted amount from the date of the verdict. Johnson v. Singleton, 442 Pa. Super. 206, 209, 658 A.2d 1372, 1374 (1995). Thus, since prejudgment interest becomes part of the verdict, and post-judgment interest under 42 Pa. C.S. § 8101 applies to the verdict, post-judgment interest is calculated based upon the verdict as molded to include prejudgment interest. See Sun Pipeline Co., 440 Pa. Super, at 68, 655 A.2d at 122. Not unlike preverdict interest in a contract action, post-verdict interest is calculated based upon the legal rate of 6% per year. See Equitable Gas Company v. Wade, 812 A.2d 715, 717 (Pa. Super. 2002).

Based upon the foregoing pre-verdict interest calculations, Thattayathu is entitled to 6% interest on his molded verdicts of $29,315.20 against Trikha and Kallickal, as well as his $17,590.40 molded verdict against Mani. Therefore, an order will be entered granting Thattayathu’s request for post-verdict interest on those amounts from April 17, 2013, to the date of payment.

ORDER

And now, this 1st day of October, 2013, upon consideration of the “Notice of Post-Trial Motion of Defendant Manmohan Trikha and Subh-Laxmi Corp. for Judgment Notwithstanding the Verdict or In the Alternative for a New Trial or Remittitur,” “Plaintiff’s Post-Trial Motion for an Award of Pre- and Post-Verdict Interest Against the Defendants Manmohan Trikha, Sogi Kallickal and Matthew Mani,” the memoranda of law submitted by the parties, and the oral argument of counsel on August 14, 2013, it is hereby ordered and decreed that:

1. The motion of defendants, Manmohan Trikha and Subh-Laxmi Corp., for judgment notwithstanding the verdict is denied:

2. The motion of defendant, Manmohan Trikha, for remittitur relief is granted to the extent that the compensatory damages award against him exceeds $25,000.00. If plaintiff, Joy P. Thattayathu, files a remittitur of $100,000.00, reflecting a reduction in his unjust enrichment award against defendant, Manmohan Trikha, to $25,000.00, within twenty (20) days of the date of this order, the post-trial motion of defendant, Manmohan Trikha, for a new trial on damages will be denied.

3. If plaintiff, Joy P. Thattayathu, fails to accept and file such a remittitur within the next twenty (20) days, a new trial will be granted solely on the issue of compensatory damages against defendant, Manmohan Trikha;

4. In light of the grant of the motion of defendant, Manmohan Trikha, for remittitur, the motion of defendant, Manmohan Trikha, for a new trial is dismissed as moot, as per the stipulation of counsel for defendant, Manmohan Trikha, at the time of oral argument;

5. Plaintiff’s motion for an award of pre-verdict interest is granted, and the verdicts are molded in the following manner to reflect awards of pre-verdict interest: $29,315.20 against defendant, Manmohan Trikha; $29,315.20 against defendant, Sogi Kallickal, and $17,590.40 against defendant, Matthew Mani; and

6. Plaintiff’s motion for post-verdict interest is granted and the verdict against defendant, Manmohan Trikha, in the molded amount of $29,315.20, the verdict against defendant, Sogi Kallickal, in the molded amount of $29,315.20, and the verdict against defendant, Matthew Mani, in the molded amount of $17,590.90, shall bear post-verdict interest at the rate of 6% per annum from April 17, 2013, until the date of payment.

      . By agreement of the parties, the $50,000.00 check was made payable to Trikha’s solely owned company, SMS Petroleum Corp. (T.P. 4/15/13 atpp. 126, 128; T.P. 4/16/13 atpp. 33-34; T.P. 4/17/13 atp. 71).

      . Trikha’s testimony in that regard was contradicted by Thattay athu’s check that Trikha endorsed and deposited and which contained the express notation “gas station deposit.” (T.P. 4/17/13 at p. 32).

      . In light of our grant of Trikha’s motion for remittitur, Trikha’s motion for a new trial is deemed withdrawn, as per the representation of Trikha’s counsel at the time of oral argument, and will be dismissed as moot.

        . Pennsylvania Rule of Civil Procedure 238 governing delay damages in civil actions for “bodily injury, death or property damage” does not apply to breach of contract claims for pecuniary loss, see Sun Pipeline Co. v. Tri-State Telecommunications. Inc., 440 Pa. Super. 47, 60-61, 655 A.2d 112, 118-119 (1994), app. denied, 542 Pa. 673, 668 A.2d 1136 (1995), or to fraud actions seeking recovery of compensatory damages. See Hughes v. Consol-Pennsylvania Coal Co., 945 F.2d 594, 616 (3d Cir. 1991), cert. den., 504 U.S. 955 (1992). The recoveiy of prejudgment interest in the latter type of commercial tort claim is governed by Marrazzo v. Scranton Nehi Bottling Co., 438 Pa. 72, 263 A.2d 336 (1970), and its progeny.


author: MOTTO, P.J.,

text:
    French v. Commonwealth Associates

      C.P. of Lawrence County,
    Nos. 10251, 10312 and 10401 of 2003, C.A.

      Daniel I. Herman, for plaintiffs.

      Michael D. Heintzman and Kevin M. Ward, for defendant United Conveyor.

      DouglasR. Nolin, for defendant Gilbert/Commonwealth Associates.
    October 2, 2013
   MOTTO, P.J.,

Before the court for Disposition are two separate motions for summary judgment brought by defendant United Conveyor Corporation (hereinafter, “United Conveyor”), and defendant Gilbert/Commonwealth Associates, Inc. (hereinafter, “Gilbert”). The plaintiff, Debra French, alleges that under the theories of negligence, negligent design, breach of warranty, and strict liability under Section 402(a) of the Restatement (Second) of Torts, both United Conveyor and Gilbert caused and/or contributed to the death of plaintiff-decedent, Brian P. French. Both United Conveyor and Gilbert argue, inter alia, that the plaintiff’s claims against them are barred by Pennsylvania’s Statute of Repose, and that those claims should be dismissed as a matter of law. The plaintiff contends that the Statute of Repose is not applicable in this matter, and both defendants’ motions should be denied. Both defendants also contend that all claims against them on all theories of recovery must be dismissed because plaintiff cannot prove a claim against them on any theory of liability as a matter of law.

I. Background

Plaintiff-decedent Brian P. French (hereinafter, plaintiff-decedent French) was a Senior Power Plant Operator employed by the Penn Power Company (hereinafter, Penn Power) at the west Pittsburg Power Plant (hereinafter, WPPP) in West Pittsburg, Lawrence County, Pennsylvania. On April 9,2001 plaintiff-decedent French died while attempting to remove a piece of metal that had become lodged within a “dog box,” a component of WPPP’s Boiler units. For purposes of explaining the circumstances surrounding plaintiff-decedent’s death, a brief description of WPPP, its facilities and equipment, and the mechanisms of those facilities and equipment will be provided.

WPPP is a coal burning power plant. WPPP houses five boilers, or “units,” although only units 3, 4, and 5 were operational at the time of plaintiff-decedent’s death. Each Unit has an ash pit and a specifically designed Ashpit Rejection System (hereinafter, “ARS”), that is designed to carry the ash away from the unit.

Two types of ash are created when coal is burned in a unit: fly ash and bottom ash. Fly ash is created when ash travels upward within a boiler, whereas bottom ash falls into the bottom of the boiler. These two types of ash require their own specific systems for removal within an ARS. The bottom ash removal system removes ash from the bottom of the boiler through the use of pressurized water, which moves the ash from the bottom of the boiler to a “hopper.” The hopper consists of a water and ash tank. The tank sits beneath the boiler and collects the ash that is created by the boiler.

Attached to the tank is a bottom ash hopper discharge enclosure, commonly called a “dog box.” At the bottom of the dog box is an ash grinder which grinds and pulverizes the ash that is collected in the dog box. Water is pumped into the dog box and mixes with the ash to create slurry, which is then pumped out of the dog box and carried away into a slurry storage pond outside of the plant.

In 1961, Commonwealth Associates, Inc. (later known as Gilbert/Commonwealth Inc. of Michigan) was retained by Penn Power to design unit 5. Commonwealth Associates provided the general design specifications for a system into which the ARS was to be integrated and utilized in the coal burning, electrical-generation processes within unit 5. Commonwealth Associates solicited bids to design the ARS, and United Conveyor was retained to design the system, including the dog box. Unit 5 became operational in 1964.

In 1973, Gilbert Associates, Inc. purchased Commonwealth Associates, Inc, and became a subsidiary of Gilbert Associates, Inc. Gilbert Associates, Inc. changed its name to Gilbert/Commonwealth Inc. in 1984. Moreover, Commonwealth Associates, Inc., the Michigan corporation responsible for designing unit 5 changed its name to Gilbert/Commonwealth, Inc. of Michigan. In 1991, the assets of Gilbert/Commonwealth, Inc. of Michigan were sold to a third party, and in 1005, Gilbert/ Commonwealth, Inc. of Michigan was dissolved.

The plaintiff’s complaint alleges that on April 9, 2001, plaintiff-decedent French attempted to remove a piece of metal that had become caught in the grinder. The piece had tripped the breaker and caused the grinder to stop. A co-worker opened the door to the dog box and viewed the piece of metal, but was unable to reach it, and called plaintiff-decedent French for assistance.

Plaintiff-decedent French allegedly put his head, both arms, and shoulders through the door in an attempt to retrieve the metal piece from the grinder. While he was doing this, a pump on the dog box tripped, and the dog box filled with slurry. Co-workers were unable to pull plaintiff-decedent French out of the dog box, and he drowned.

Plaintiff commenced the instant wrongful death action on April 3, 2003 by filing a writ of summons. By order of the court, plaintiff’s original suit was consolidated on June 10, 2005. Plaintiff’s complaint was filed on September 8, 2005.

II. Standard of Review

After the relevant pleadings are closed, but within such time as not to unreasonably delay trial, any party may move for summary judgment in whole or in part as a matter of law. Pa.R.C.P. 1035.2. In considering the merits of a motion for summary judgment, the court views the record in the light most favorable to the non-moving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party. Fine v. Checcio, 582 Pa. 253, 265, 870 A.2d 850, 857 (2005). Where the non-moving party fails to adduce sufficient evidence to establish the existence of an element essential to his case and on which he bears the burden of proof, then the moving party is entitled to judgment as a matter of law. Ertel v. Patriot-News Co., 544 Pa. 93, 674 A.2d 1038 (1996).

III. Discussion

For the sake of completeness and conciseness, the court will address the merits of both defendants’ motions for summary judgment individually and separately.

A. Defendant United Conveyor’s Motion

Relative to defendant United Conveyor, the plaintiff alleges that plaintiff’s and plaintiff-decedent’s injuries are the result of the United Conveyor’s negligence and breach of warranty, arguing that the United Conveyor defectively designed and manufactured the dog box and Ashpit Rejection System. Furthermore, plaintiff alleges that United Conveyor failed to warn users of the dog box of potential dangers. Plaintiff also argues that defendant United Conveyor is liable for plaintiff’s and plaintiff-decedent’s injuries under a theory of strict liability under Section 402(a) of the Restatement (Second) of Torts.

Defendant United Conveyor argues that the plaintiff’s claims are barred by Pennsylvania’s Statute of Repose since more than twelve (12) years elapsed between the completion of the dog box and ash conveying system and the date of plaintiff-decedent’s accident. Furthermore, United Conveyor argues that it cannot be held liable under Section 402(a) of the Restatement (Second) of Torts because the ash handling system experienced significant and substantial changes between the date of its installation and the date of the plaintiff-decedent’s accident. United Conveyor also contends that the obstruction of the main access door to the crusher within the dog box was a superseding cause of the plaintiff-decedent’s accident and resulting injuries, and it therefore cannot be held liable for any negligence.

1. Pennsylvania’s Statute of Repose

Pennsylvania’s Statute of Repose is codified at 42 Pa.C.S.A. §5536. In relevant part, the statute provides:

(a) General rule. — Except as provided in subsection (b), a civil action or proceeding brought against any
person lawfully performing or furnishing the design, planning, supervision or observation of construction, or construction of any improvement to real property must be commenced within 12 years after completion of construction of such improvement to recover damages for:
(1) Any deficiency in the design, planning, supervision or observation of construction or construction of the improvement.
(2) Injury to property, real or personal, arising out of any such deficiency.
(3) Injury to the person or for wrongful death arising out of any such deficiency.
(4) Contribution or indemnity for damages sustained on account of any injury mentioned in paragraph (2) or (3).

42 Pa.C.S.A. §5536. A party moving for protection under the statute of repose must show: 1) that what was supplied was an improvement to real estate; 2) that more than 12 years elapsed between the completion of the improvements to real estate and the injury; and 3) that the activity of the moving party was within the class which is protected by the statute. McConnaughey v. Building Components, Inc., 536 Pa. 95, 99, 637 A.2d 1331, 1333 (1994).

United Conveyor was retained by Gilbert in 1961 to design the ARS, including the dog box, for unit 5. Unit 5 became operational in 1964. Neither plaintiff nor United Conveyor dispute this. Thus, there is no question that more than 12 years have passed between the completion of the ARS and dog box and the date of plaintiff’s and plaintiff-decedent’s injuries.

The court directs its attention to the meaning of the term “improvement” within the confines of the statute of repose. In McCormick v. Columbus Conveyor Co., 522 Pa. 520, 564 A.2d 907 (1989), the Pennsylvania Supreme Court adopted the Black’s Law Dictionary definition of “improvement” as:

A valuable addition made to property (usually real estate) or an amelioration in its condition, amounting to more than mere repairs or replacement, costing labor or capital, and intended to enhance its value, beauty or utility or to adapt it for new or further purposes.

522 Pa. at 524, 564 A.2d at 909. Whether a particular piece of equipment is an improvement to real estate is a question of law. Lejeune v. Bliss-Salem, Inc., 1995 W.L. 491253 at 5 (E.D. Pa.1995); Bioni v. Canon-McMillan School District, 521 Pa. 299, 555 A.2d 901 (1989).

What constitutes an improvement to real estate is a determination which must be made on a case-by-case basis. Christ v. Prater Industries, Inc., 67 F. Supp. 2d 491 (E.D. Pa. 1999). An improvement may be anything that permanently enhances the value of real property and commonly includes erection of a building, replacing old buildings with new ones, substantial repairs to a building which are necessary to preserve it, substantial additions to or changes in existing buildings, construction of sidewalks, erection of fences and preparation of land for building sites. Christ v. Prater Industries, Inc., supra at 494; Noll v. Harrisburg Area YMCA, 537 Pa. 274, 286, 643 A.2d 81, 87 (1994).

It is axiomatic that a fixture qualifies as an improvement. Christ v. Prater Industries, Inc., supra, citing Nish v. FMC Corporation, 1993 W.L. 74839 (E.D. Pa. 1993); Catanzaro v. Wasco Products, Inc., 339 Pa. Super. 481, 485, 489 A.2d 262 1985. The Federal Court in Christ provided the following test:

The general test used in determining when an article of personalty is a fixture has three components:
(1) the relative permanence of attachment to realty;
(2) the extent to which the chattel is necessary or essential to the use of the realty; and (3) the intention of the parties to make a permanent addition to the realty. Noll, 537 Pa. at 286-287, 643 A.2d at 87. Other considerations in making a determination whether an object is a fixture and hence may be considered to be an improvement include: the ease of removing the object; whether the object may be removed without damaging the real property; how long the object has been attached to the real property; whether the object is necessary or essential to the real property; and the conduct of the party and whether it evinces an intent to permanently attach the object to the realty. Vargo, 715 A.2d at 426, citing Noll, 537 Pa. at 288, 643 A.2d at 88.

Christ v. Prater Industries, Inc., 67 F. Supp. 2d at 494.

In Christ, the federal court found that a grass seed mixer did not constitute an improvement to realty and was in the nature of personalty. The seed mixer model which caused the plaintiff’s injuries in Christ was thirteen to fifteen tall, weighed approximately % of a ton and sat on braces, which are bolted into the plant foundation with six very large one-half inch bolts. There is a pit beneath the mixture that goes below level for cleaning the mixer out at the bottom. The court noted that despite its weight (400 to 500 pounds of which is made up by the drive motor) the mixer was fully assembled at the Prater Industries plant in Illinois. In 1975 it was shipped to the plant in Denver, PA, where the plaintiff was employed, although the drive motor and pulley assemblies were removed for shipping and subsequently reinstalled. The court further noted that the mixer can be moved without damage to the building and was not a part of the building structure, although retro-fitting would require about one and one-half days of downtime for the mixer and approximately 25 to 40 man hours. The court further noted that while it appeared that the mixer had never been moved, there was no evidence before the court as to an objective intention to incorporate the mixer into the physical plant as to render it an actual part of the facility. Further the court found that there was no evidence that the mixer was an integral and necessary part of the real estate such that its presence significantly enhanced the value of the realty or that its absence would significantly damage the property’s value.

Here, the bottom ash system is described as including a water and ash tank which is 40 foot long by 14 foot high by 11 foot wide, which is bolted to the floor of the plant. Welded to the tank is the dog box, and bolted to the dog box is a grinder, transition piece, pump and 1500 feet of pipe. The system weighs several thousand pounds. The water and ash tank, and the dog box, which is welded to it, accepts ash from the bottom of the boiler and acts as a receptacle and conduit for this ash to exit the plant to a storage pond outside of the plant. Removal of the system would require a shutdown of the unit that it serves that produces power. The bottom ash conveying system would have to be completed dissembled.

The court here finds that the question of whether the ash pit rejection system constitutes a fixture and thus an improvement to the real estate is a question of fact for the jury.

As noted in Anderson v. Liberty Lobby. Inc., 477 U.S. 242, 247-49, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986), the court’s responsibility is not to resolve disputed issues of fact, but to determine whether there exists any factual issues to be tried.

Here, there exists factors which must be considered in determining whether or not the equipment in question constitutes a fixture which cannot be resolved by the court based upon the record as it presently exists. The record is not clear as to the degree of attachment of this system to the real property nor the extent to which the object may be removed without damaging the real property. Also, there is disputed evidence as to whether it was the intent of the parties to permanently attach the object to realty as plaintiff references the asset sale agreement which lists the equipment as an asset sold separately from the realty. Further, the court cannot determine from this record the exact work that would be necessary to dismantle the equipment and remove it from the realty. Relevant evidence can also conclude testimony regarding the effect on the value of the real estate if the equipment were removed. Defendants have argued that the system is necessary to the operation of the boiler; however, the question is not its necessity to the operation of a specific function but rather a necessity to the building itself. Based upon the evidence that is available or lack of it, that issue is subject to further development through evidence and argument. Defendants also argue that if the system were removed, the components would have to be cut into pieces small enough to remove them from the building, however, the court cannot determine as a matter of law at this juncture whether it is possible to remove the system in sections in such a manner that its utility could be spared.

The defendants rely heavily upon McCormick v. Columbus Conveyor Co., 522 Pa. 520, 564 A.2d 907 (1989), which held that an action brought by a worker injured by a belt conveyor incorporated into a power plant was subject to summary judgment under the statue of repose as to the manufacturer of the belt conveyor. The court held that the manufacturer was engaged in the design of an improvement to real property and was thus entitled to the benefit of the statute of repose. However, a reading of McCormick shows that the Supreme Court did not conduct an analysis of the issue of whether the belt conveyor constituted an improvement to real property as that issue had been previously determined thereby establishing the conveyor as an improvement by the law of the case, the Supreme Court stating that it is hornbook law that issues decided by an appellate court on a prior appeal between the same parties become the law of the case. Thus, the specific evidence that was relied upon in McCormick to determine that the conveyor constituted an improvement to real estate was never discussed in the McCormick opinion and is not available for comparison in this case. The bulk of the opinion in McCormick goes to the issue of whether the manufacturer fell within the class of persons the statute was enacted to protect.

In Ervin v. Continental conveyor & Equipment Co., Inc., 674 F. Supp. 2d 709 (D.S.C., 2009), the court held that a cotton baling operation was not a permanent improvement to real property even though the incline conveyor was bolted down and hard wired to the facility’s electrical system. In Ervin, the manufacturer cited McCormick v. Columbus Conveyor, supra, as an example of a conveyor system that was found to be a fixture. However, the court also noted a number of other cases in which conveyor systems and similar industrial devices were determined not to be improvements to real property for the purpose of various statutes of repose. The Federal Court pointed to Tropello v. Matthews Conveyor Co., 1994 W.L. 161380 (E.D. Pa. 1994), where the District Court for the Eastern District of Pennsylvania determined that a conveyor system in a Nabisco bakery did not constitute an improvement to real property. The system in Nabisco consisted of eleven sections all bolted together and attached directly to the bakery’s ovens, suspended from a steel frame consisting of vertical rods and attached to beans running parallel to the ceiling of the plant. In Nabisco, the conveyor at issue had been dismantled and sold for scrap. Tropello distinguished McCormick by noting that the conveyor was not incorporated into the construction of the building as was the coal conveyor in McCormick. Using that analysis, the court cannot here determine that the ash pit rejection system is incorporated into the construction of the building. In fact, the evidence of record would suggest that it is not.

Ervin further cited Cosse v. Allen-Bradley Co., 601 So.2d 1349, 1354 (1992), which held that the designer and installer of a conveyor system was not entitled to protection under the statute of repose where the conveyor system at issue was approximately 80 feet in length, and was suspended from the floor of the building and attached with bolts. The court further noted that in order to remove the conveyor, it would be necessary to dissemble it and take it out in pieces. The Louisiana Supreme Court concluded that the defendants had not sufficiently proved that the conveyor was an improvement and thus declined to apply the State of Repose to the conveyor system.

The court here concludes that the record presently before the court is inconclusive as to all the factors that must be considered in determining whether the ash pit rejection system constitutes an improvement to realty, and such determination can only be made after development of a full record at trial.

Given our finding that an issue of fact exists as to whether the ash pit rejection system constitutes an improvement within the meaning of §5536, the court need not address the question of whether or not the defendants fall within the class protected by the statute. The court further notes that defendant Gilbert Commonwealth has entered into an a joint tort feasor release with the plaintiffs; however, the court finds that the existence of such release has no effect on the merits on the motion for summary judgment.

2. Liability under Section 402A of the Restatement (Second) of Torts

A plaintiff proceeding under Section 402A of the Restatement (Second) of Torts must prove: 1) that the product was defective; 2) that the defect existed when it left the hands of the defendant; and 3) that the defect caused the harm. Riley v. Warren Manufacturing, Inc., 688 A.2d 221, 224 (Pa. Super. 1997).

United Conveyor contends that at some point after the installation of the ashpit rejection system, the system was substantially changed with the addition of a pipe that had been placed in front of the main access door. United Conveyor asserts that this pipe prevented workers from accessing the dog box and crusher through the larger, main access door as intended and contemplated by the original design of the system. In support of this contention, United Conveyor cites testimony of Richard Sutton a co-worker of plaintiff-decedent. Mr. Sutton testified:

Q: If the side door was accessible and the side door was open and water came into the dog box, the water would exit through the side door; correct?
A: Yes.
Q: And that would prevent a drowning occurring?
A: Absolutely.
Q: Like the one in this case?
A: Correct, correct.

(Defendant United Conveyor’s exhibit D — Richard Sutton). United Conveyor also provided testimony from Keith Bastian, a plant manager at WPPP in 2001. Mr. Bastian testified:

Q: Okay. Knowing the dimensions of that die door, if Mr. French had gone in the side door and the dog box would have filled with water, would there have been room for the water to exit the dogbox?
A: Because of the location of the door, the dog box would not have even begun to fill up with water. It would have just run out the door.
Q: So if Mr. French had used the side door, this accident would not have happened; is that correct?
A: Correct.

(United Conveyor exhibit I — Keith Bastían).

United Conveyor argues that because of the obstruction of the main access door by the pipe, plaintiff-decedent died while accessing the crusher through a smaller access point that was not intended to be used in that manner.

Plaintiffs assert that the pipe was a design defect of the ashpit rejection system which was in place when it was installed. Plaintiffs argue that since United Conveyor did not provide erection engineers for the ashpit rejection system’s construction and thus are responsible for the alleged defect.

It is clear that issues of fact remain as to the installation of the pipe that allegedly blocked the main access door, and whether this was a defect that existed when United Conveyor designed the ashpit rejection system. Since issue of facts remain as to this theory of liability, summary judgment would be improper.

3. Negligence

To prevail on a negligence claim, plaintiffs must establish a legal duty, a breach of that duty, and a casual connection between the breach and resulting injury. Hightower-Warren v. Silk, 548 Pa. 459, 698 A.2d 52, 54 (1997). A superseding cause is an act of a third person or other force which, by its intervention, prevents the actor from being liable to another. Restatement (Second) of Torts, §440. Superseding events may relieve a defendant of liability by breaking the chain of causation. Powell v. Drumheller, 539 Pa. 484, 493, 653 A.2d 619, 623 (1995).

United Conveyor alleges that the pipe which blocked the dog box’s main access door is a superseding cause of plaintiffs’ injuries. As discussed above, however, issues of fact remain as to the installation of the pipe, and whether it in fact caused plaintiff-decedent’s death. Thus, summary judgment would be improper on these issues at this time.

4. Pre-Emption and Sophisticated User

United Conveyor has also raised federal pre-emption as to Permit-Required Confined Spaces; however, this court has already ruled in response to a prior motion in limine to preclude expert testimony that the rule of pre-emption is not applicable in this case. See order dated December 5, 2012. Additionally, United Conveyor has raised the issue of “Sophisticated User” as a defense pursuant to §388 of the Restatement 2d of Torts; however, that defense cannot be determined at this time because it would require a finding that United Conveyor provided the information as to the alleged defect to a third party responsible for assuming a duty to warn. Here, United Conveyor denies the existence of a defect and provides no evidence of having passed on specific information that would pass that duty on to any third person and thereby resolve itself of any responsibility.

B. Defendant Gilbert’s Motion

Relative to defendant Gilbert, the plaintiff alleges that the Gilbert is liable for the injuries sustained by plaintiff and plaintiff-decedent under the theories of negligent design and breach of warranty. Furthermore, plaintiff alleges that defendant Gilbert is liable under a theory of strict liability under Section 402(a) of the Restatement (Second) of Torts.

Defendant Gilbert argues that the plaintiff’s claims are barred by Pennsylvania’s Statute of Repose since more than twelve (12) years elapsed between the completion of the dog box and ash conveying system and the date of plaintiff-decedent’s accident. Gilbert also contends that it cannot be held liable under Section 402(A) of the Restatement (Second) of Torts because the ARS experienced significant and substantial changes between the date of its installation and the date of the plaintiff-decedent’s accident.

1. Pennsylvania’s Statute of Repose

The court references its foregoing discussion of 42 Pa.C.S.A. §5536, relative to United Conveyor’s motion for summary judgment and incorporates it herein as it applies to defendant Gilbert.

2. Section 402A of the Restatement (Second) of Torts

Gilbert argues that Section 402A does not extend to parties who provide only services. Gilbert contends that it did not in fact supply any product, and that its technical drawings and professional advice do not constitute products that would give rise to Section 402A liability.

Section 402A does not provide a definition of the word “product.” In Cox v. Shaffer, 223 Pa. Super. 429, 302 A.2d 456 (1973), the Superior Court declined to extend the definition of product to include a silo built on an employer’s land. Id. Consequently, Pennsylvania has not expanded liability under 402A to include individuals who provide a service. See Snyder v. ISC Alloys, Ltd., 772 F. Supp. 244, 251 (1991) (holding that technical drawings do not constitute a product); Abdul-Warith v. Arthur McKee & Co., 488 F. Supp. 306, 310 (E.D. Pa. 1980) (holding that an architect or designer who simply provides services in the manner of the design or merely supervises cannot be held strictly liable).

In the case sub judice, it is apparent that the former Commonwealth Associates provided design specifications and solicited bids for those specifications to be engineered. The specifications for unit 5 were subsequently designed by United Conveyor. At no time did Commonwealth Associates supply anything more than design specifications or schematics, and technical drawings. Thus, Commonwealth Associates did not supply a product within the meaning of Section 402A, and Gilbert cannot be liable under that theory. Therefore, Gilbert is entitled to judgment as a matter of law regarding liability under Section 402A.

Plaintiff has also alleged negligence theories against defendant Gilbert Commonwealth, but has not come forward with any identification of any evidence of any negligence attributable to these defendants, by way of expert testimony or otherwise.

ORDER OF COURT

And now, this 2nd day of October, 2013, for the reasons set forth in the accompanying opinion of even date herewith, it is ordered, adjudged, and decreed:

1. Defendant United Conveyor’s motion for summary judgment is hereby denied.

2. Defendant Gilbert Commonwealth, Inc.’s motion for summary judgment is hereby granted. The plaintiff’s complaint against this defendant as well as any other claims or cross-claims of any other party against it are dismissed.