author: BROWN JR., P.J.,

text:
    Felton v. Felton

      Mark S. Weaver, for plaintiff.

      H. Denning Mason, for defendant.
    January 24, 2008
   BROWN JR., P.J.,

Before the court are claims for equitable distribution of the parties’ marital assets, alimony, counsel fees, costs and expenses. Hearings addressing all claims were held on September 19, 2006 and February 21, 2007. A transcript was prepared and both parties submitted proposed findings of fact, conclusions of law, and orders.

FINDINGS OF FACT

In accordance with section 3502 of the Divorce Code, the court must consider the factors set out below in determining equitable distribution of property. Upon consideration of evidence presented at hearings and the submissions of the parties, this court finds the following:

(1) Length of marriage.

Plaintiff Gary W. Felton (Husband) and defendant Colleen E. Felton (Wife) were married on March 22, 1980, in Orange County, California. The parties separated on or about October 10, 2003, when Husband left the marital residence. They were divorced by decree of this court on February 9, 2006.

(2) Any prior marriage of either party.

Husband had not been previously married at the time of his marriage to Wife. Wife was married in January of 1973 to Kirby Marshall, but was divorced from him in 1978. F ollowing the issuance of the divorce decree by this court on February 9,2006, Husband married Dawn Luthe on March 10, 2006. Defendant has not married again.

(3) Age, health, station, amount and sources of income, vocational skills, employability, estate, liabilities and needs of each party.

(a) Age: Husband is 54 years of age, having been bom on September 6, 1953. Wife is 53 years of age, having been born on February 12, 1954.

(b)Health: Husband has hypertension and arthritis in his spine. He sees a therapist for stress related to the divorce. He takes medications for hypertension. Wife has diabetes, asthma and arthritis and has been treated for depression during the parties’ divorce proceedings. She has also fractured her left foot and fingers on both hands in recent years. She takes medications for her various conditions.

(c) Station: The parties enjoyed a middle-class lifestyle during marriage.

(d) Amount and sources of income: Husband is employed by The Pennsylvania State University as a professor of Entomology. He earns $141,444 annually in base salary ($11,787 per month), together with occasional honorariums that total less than $ 1,000 per annum. Wife is not employed. She has no income.

(e) Vocational skills; employability: Husband earned a Bachelor of Science degree in biological science from the University of Califomia-Irvine in 1975, a Master’s degree in Entomology from the University of Kentucky in 1983, and a Ph.D. in Entomology from the University of Califomia-Davis in 1988. After holding positions as an assistant professor, associate professor, and full professor at the University of Arkansas from 1990 through 2000, Husband became the head of the Department of Entomology at The Pennsylvania State University on September 1,2000. This is an advancement in his career.

Wife is currently a full-time student in the College of Education, Department of Rehabilitation Services, at The Pennsylvania State University. She expects to graduate with a Bachelor of Arts degree in 2009 and hopes to continue her education and attain a Master’s degree in 2011. Wife has vocational experience as a United States Postal Service worker, substitute teacher (non-certified), retail clerk and parenting class teacher for pregnant teenagers and their children.

(f) Estate: Neither party expects any substantial inheritance or legacy.

(g) Liabilities and needs of each party:

(i) Husband resides in Bellefonte in a house which is owned by his current wife. Although Husband does not have a mortgage obligation, he contributes to the household by making utility payments. Husband has an automobile loan with a $411.91 monthly payment. Husband makes a monthly payment of $152.28 to Commercial Acceptance Company for an overdrawn account the parties opened at Omega Bank after separation. Husband has a monthly student loan payment of $130. Husband makes monthly COBRA payments of $319.20 for Wife’s health insurance. Husband also makes two monthly payments to TIAA-CREF for loans he has taken against his retirement account. The first payment is $286.34 and the second payment is $139.37.

(ii) Wife has a monthly mortgage payment in the amount of $1,364.52 for a residence she acquired after final separation. Her automobile was gifted to her by her aunt. She took a loan, as the result of a gift tax, which costs her $ 122 per month. Wife’s student loans are in deferment and do not require payment at the present time. Wife’s disposable monthly income cannot be determined.

(4) Contribution by one party to education, training or increased earning power of other party.

(a) Husband completed two graduate degrees during the marriage; however, Husband received graduate assistantships for both degrees and had only two student loans during this time in the total amount of $10,000. Husband also received income from his parents to support the parties while he earned his graduate degrees.

(b) When Husband was fired from his job with the United States Postal Service in 1981, Wife encouraged him to return to school. Wife sold the town home she had owned prior to the marriage and used the profits to pay bills during Husband’s post-college studies. Wife initially received approximately $40,000 and subsequent payments from owner-financing of $239 per month for five years.

(c) Wife also contributed $6,000 in retirement benefits from the USPS to pay bills while she was earning additional money from babysitting and employment with J. C. Penney Company. During the parties’ marriage, Husband encouraged Wife to return to school to further her education.

(5) Opportunity of each party for future acquisitions of capital assets and income.

(a) Husband’s salary is $141,444 per year. There was no testimony as to Husband’s expectation for future increases in his income.

Husband married again in March 2006. Although Husband’s new wife is also a professor at The Pennsylvania State University, there is no evidence that her income is not available to Husband other than in the form of providing him with a residence.

(b) Wife’s earning power should increase when she completes her schooling and begins employment.

(6) Sources of income of both parties, including, but not limited to, medical, retirement, insurance or other benefits.

Husband receives income from his employment with The Pennsylvania State University. Wife has no current income other than her spousal support from Husband and proceeds from student loans.

(7) Contribution or dissipation of each party in the acquisition, preservation, depreciation or appreciation of the marital property, including the contribution of a party as homemaker.

(a) Shortly after the parties married, Wife used the proceeds from the sale of her town home in California to pay for living expenses incurred by the parties and their minor children. These funds were not used to pay for Husband’s education. Wife also worked a limited number of part-time jobs to help with the parties’ living expenses. Wife’s main contribution was as a homemaker during the marriage. After completion of his postdoctoral work, Husband worked throughout the marriage as a faculty member at two universities.

(b) After separation, Wife was responsible for making mortgage payments for the marital residence in State College, Centre County, Pennsylvania. As the result of Wife’s failure to make the mortgage payments, the marital residence was foreclosed upon by the mortgagee and sold at sheriff’s sale in the summer of 2005. At the time, Wife was receiving approximately $6,600 per month in support from Husband. As the result of Wife’s failure to make the mortgage payments, Wife is responsible for the dissipation of $17,989.58 of the marital estate, which represents the equity in the marital residence at the time Wife first failed to make mortgage payments on the marital residence in May of 2004.

(c)Prior to separation, the parties planned to purchase a second vehicle using a loan from Husband’s TIAA-CREF account and the parties’ 2002 tax refund. After the loan was received from TIAA-CREF, Wife used $9,000 of the loan to purchase kitchen items in December 2002 without Husband’s consent. As the result of Wife’s misuse of the funds from the retirement loan, Wife is responsible for the dissipation of $9,000 of the marital estate.

(8) Value of property set apart to each party.

(a) The parties stipulated that the marital portion of Husband’s TIAA-CREF retirement account had a value at separation as of December 13,2005 of $83,912.24. At the time of the first hearing before the court, this figure had risen to $157,035.53. Neither of these figures were challenged by Wife. Husband has provided $10,000 to Wife as a partial distribution from his TIAA-CREF retirement account through payments from his income over time and through a loan he took against the account.

(b) Household property from the former marital residence had a value of approximately $9,300 at the time of purchase.

(c) The parties’ Salvador Dali lithograph “Agony of Love” has a value of $2,500.

(d) The parties purchased a jointly-titled 2003 Honda Civic Hybrid two months prior to final separation with no trade-in or down payment. The car is valued at $15,096 and has a date-of-hearing loan balance of $9,697.01, leaving a net equity value of $5,398.99.

(e) The 1996 Honda Accord sedan for which Wife received a $100 credit in the purchase of her 2004 Honda CRV van. This $ 100 value was not challenged by Husband.

(9) Standard of living during marriage.

The parties had a middle class standard of living during the marriage.

(10) Economic circumstances of each party, including federal, state, and local tax ramifications, at the time division of property is to become effective.

There are no significant tax ramifications from the division of property.

(11) Whether a party will be serving as custodian of any dependent minor children.

The parties’ children are both adults and currently enrolled in college.

(12) Marital misconduct.

The marriage ended because Husband was involved in a relationship with another woman. He admitted on cross-examination that he began a relationship with Ms. Dawn Luthe, whom he subsequently married, in September of 2002, more than one year prior to the parties’ separation.

(13) Whether the party seeking alimony lacks sufficient property to provide for the party’s reasonable needs.

(a) Husband has provided Wife with additional support monies and benefits since the parties’ separation so that Wife can improve her economic situation and provide for her own needs in the future. In addition to spousal support payments, Husband provided $5,909.13 over several months in additional income to Wife after separation. Husband has provided Wife with $ 1,000 for payment of her attorney fees.

(b) Since the spring of2006, Husband has been paying the tuition discount for Wife at The Pennsylvania State University and will continue to do so through spring of 2009.

(c) The cost of Wife’s tuition, fees and books for the 2006-2007 academic year is $ 17,861, without the tuition discount paid by Husband. The anticipated amount of student aid available to Wife for the 2006-2007 academic year is $16,138.

(14) Whether the party seeking alimony is incapable of self support through appropriate employment.

Wife will be capable of self-support through employment once she obtains her undergraduate degree.

CONCLUSIONS OF LAW

(1) The trial court has broad discretion in determining equitable distribution of marital property. Twilla v. Twilla, 445 Pa. Super. 86, 89, 664 A.2d 1020, 1022 (1995).

(2) Equitable distribution does not necessarily mean an equal division. Platek v. Platek, 309 Pa. Super. 16, 454 A.2d 1059 (1982).

(3) There is a presumption that property acquired by either party during the marriage is marital property. 23 Pa.C.S. §3501(b).

(4) In equitable distribution of marital property, the court must view the parties’ situation in light of the totality of the circumstances and consider all of the relevant factors set forth in the divorce code at 23 Pa.C.S. §3501(a). 23 Pa.C.S. §3502.

(5) “The trial court has the authority to divide the [marital property] as the equities presented in [a] particular case may require.” Teodorski v. Teodorski, 857 A.2d 194, 199 (Pa. Super. 2004). (internal quotation marks omitted)

(6) Marital property must be distributed with reference to value proximate to the date of distribution. Wellner v. Wellner, 699 A.2d 1278, 1283 (Pa. Super. 1997).

(7) The trial court in an equitable distribution matter is entitled to assess the credibility of the evidence presented. Miller v. Miller, 744 A.2d 778, 790 (Pa. Super. 1999).

(8) The portion of a pension attributable to the period from commencement of marriage to date of separation is marital property. Brown v. Brown, 447 Pa. Super. 424, 669 A.2d 969(1995).

(9) “An award of counsel fees is warranted when it will promote the fair administration of justice by enabling the dependent spouse to maintain or defend the case without being placed at a financial disadvantage.” Miller v. Miller, 744 A.2d 778, 790 (Pa. Super. 1999).

(10) Relevant factors to consider in determining whether to award counsel fees include the payor’s ability to pay, the requesting party’s financial resources, the value of the services rendered, and the property received in equitable distribution. Id.

(11) “The purpose of alimony is ... to ensure that the reasonable needs of the person who is unable to support himself or herself through appropriate employment, are met.” Twilla, 445 Pa. Super at 90, 664 A.2d at 1022.

(12) “Alimony following a divorce is a secondary remedy and is available only where economic justice and the reasonable needs of the parties cannot be achieved by way of an equitable distribution and development of an appropriate employable skill.” Id.

(13) To determine whether alimony is necessary, the court must consider all relevant factors, including those statutorily prescribed at 23 Pa.C.S. §3701(b). Twilla, supra at 90-91, 664 A.2d at 1022.

DISCUSSION

Husband requests a 60/40 division of marital property in favor of Wife with no alimony to be paid. Wife requests a 50/50 division of marital property with lifetime alimony, as well as Husband’s paying counsel fees and costs.

The parties were married for approximately 26 years. Two children were bom of the marriage. During the marriage, Husband was employed full-time and provided the family with financial support. During the marriage, Wife was employed to a limited degree. The parties enjoyed a middle class lifestyle during their marriage.

Husband is 54 years old and Wife is 53 years old. Both parties are in relatively good health for their age. Husband has hypertension and arthritis in his spine and sees a therapist for stress related to the divorce proceedings. He takes medications for hypertension. Wife has diabetes, asthma and arthritis and has been treated for depression during the parties’ divorce litigation. She has also broken her left foot and fingers on both hands in recent years. She takes medications for her various conditions.

Husband is employed by The Pennsylvania State University with an income of $141,444 per year, plus approximately $1,000 per year in honorariums. Wife is a full-time student. Wife receives alimony pendente lite and tuition discount payments from Husband.

Husband married again and lives with his new wife in a house titled solely in her name. Husband therefore has no rent or mortgage payments. Wife has a mortgage on her house with monthly payments of $1,364.52.

The parties accumulated considerable debt during their marriage.

Based upon the factors discussed above, the court determines an equitable division of the marital assets dictates a division such that 50.2 percent of the parties’ total marital equity is allocated to Wife and 49.8 percent of the total marital equity is allocated to Husband.

Counsel Fees

Wife has requested Husband pay her counsel fees and costs associated with this matter. Counsel fees, though not awarded automatically upon the request of either spouse, are appropriate when necessary to put the parties on a par in defending their rights or allowing a spouse to maintain or defend an action for divorce. Johnson v. Johnson, 365 Pa. Super. 409, 529 A.2d 1123 (1987). In making a determination to award counsel fees, the court must consider “the payor’s ability to pay, the requesting party’s financial resources, the value of the services rendered, and the property received in equitable distribution.” Miller v. Miller, 744 A.2d 778, 790 (1999). Court costs may also be awarded to any party within the trial court’s discretion and a court may award counsel fees based upon findings of disparity in the parties’ earnings and their respective ability to pay. Nuttall v. Nuttall, 386 Pa. Super. 148, 562 A.2d 841 (1989). There is no standard fixed for determination of the amount of counsel fees other than that it must be reasonable. Jack v. Jack, 253 Pa. Super. 538, 385 A.2d 469 (1978).

Wife has been receiving alimony pendente lite of $2,400 per month since March 1, 2006, pursuant to an order of this court on February 9,2006. Wife has incurred fees of $8,620.61 owed to her former attorneys, Goodall & Yurchak P.C., and owes $3,500 to her current attorney, H. Denning Mason, Esquire. Based upon property and assets Wife is receiving in equitable distribution in this matter, and on her inability to pay her various other debts, the court determines a partial award of counsel fees is warranted. Accordingly, Husband is responsible for one-half ($4,310.31) ofthe $8,620.61 due Goodall & Yurchak RC. and 60 percent ($2,100) ofthe $3,500 due H. Denning Mason, Esquire. Furthermore, and for the same reasons, Husband shall pay the entire costs of the transcripts ofthe two hearings, $774.80.

Alimony

The court may allow alimony, as it deems reasonable, to either party if it finds that alimony is necessary. The legislature sets out 17 factors to be considered in determining the nature, amount, duration and manner of payment of alimony. Most of these factors have been discussed relative to the distribution of property. The factors not previously considered, or not considered in sufficient detail, are set forth below:

(12) The contribution of a spouse as a homemaker. Wife is currently providing for the needs of the parties’ youngest child as she pursues her college education.

(14) The marital misconduct of either of the parties during the marriage. The marital conduct of either of the parties from the date of final separation shall not be considered by the court in its determinations relative to alimony. The marriage ended because Husband was involved in a relationship with another woman. He admitted on cross-examination that he began a relationship with Ms. Dawn Luthe more than one year prior to the parties’ separation. He subsequently married Ms. Luthe in September of 2002.

(15) The federal, state and local tax ramifications of the alimony award. This factor, added by the 1988 amendments to the Divorce Code, was not addressed by either party. It has therefore been given no weight by this court in its decision.

(16) Whether the party seeking alimony lacks sufficient property, including, but not limited to, property distributed under chapter 35 (relative to property rights), to provide for the party’s reasonable needs. It is apparent to the court that the equitable distribution of property ordered herein will not be sufficient to provide for Wife. The only viable solution for Wife’s needs is an award of long-term alimony.

The goal of alimony is to effect economic justice between the parties. Williams v. Williams, 373 Pa. Super. 143, 540 A.2d 563 (1988). Prior to 1980, alimony was not a statutory remedy available in divorces. The Divorce Code of 1980 established alimony as a rehabilitative and limited remedy. The requesting party was required to establish his or her inability to support himself or herself with employment or assets. The amendments in 1988 eliminated the threshold requirement of having to establish an inability of self support, changing the nature of alimony to be more flexible in allowing a court to effectuate economic justice. Alimony is no longer just for limited durations; it can be permanent. It can also be awarded even when the requesting spouse is employed.

Alimony is not to be used to reward or punish one party or the other. The goal of alimony is to ensure that the reasonable needs of the party unable to support himself or herself through employment, are met. Twilla v. Twilla, 445 Pa. Super. 86, 90, 664 A.2d 1020, 1022 (1995). Alimony is based on the reasonable needs of the recipient based on the lifestyle and standard of living established by the parties during the marriage, as well as on the payor’s ability to pay. Id. A party may be employed, but still unable to reach the marital standard of living. In such a case, alimony is appropriate. Isralsky v. Isralsky, 824 A.2d 1178 (Pa. Super. 2003). What the payor can afford to pay is the question, not what he is willing to pay. Karp v. Karp, 455 Pa.Super. 21, 27, 686 A.2d 1325, 1328 (1996).

Wife should be able to support herself on the $2,400 per month she currently receives in temporary alimony. Her income and expense statement clearly overstates her monthly needs as $5,335.52. To allow Wife the opportunity to pursue her education until she attains her degree and the ability to earn a living, Husband must meet her monthly expenses. Wife is additionally entitled to alimony while she secures a job in her chosen field.

The court determines an award of alimony to Wife is necessary. The court determines economic justice and Wife’s reasonable needs cannot be achieved solely by equitable distribution of the marital property as outlined below. In the present case, given Husband’s earnings, his future earning capacity, and the security of his position with The Pennsylvania State University, this court determines that economic justice will be served by requiring Husband to pay alimony to Wife.

Evaluation of the factors in the instant case dictates the following order be entered:

ORDER

And now, January 24, 2008, after hearing and upon consideration of arguments of counsel, this court enters an order distributing the parties’ marital assets such that 50.2 percent of the parties’ total marital equity is allocated to Wife, and 49.8 percent of the total marital equity is allocated to Husband.

Specifically, the marital assets are distributed as follows:

(1) Husband, Gary W. Felton, shall have sole ownership of the 2003 Honda Civic Hybrid sedan currently titled in the parties’joint names. Wife shall execute all documents necessary to transfer sole ownership of this vehicle into Plaintiff’s name alone as soon as reasonably possible.

(2) Wife shall retain the $100 credit she received for the trade-in of the 1996 Honda Accord sedan in purchasing her current vehicle.

(3) Husband shall receive the Salvador Dali lithograph, “Agony of Love.”

(4) Wife shall return all non-marital personal property belonging to Husband in Wife’s possession, including but not limited to Husband’s scientific data and books, vinyl record collection, and baseball memorabilia collection.

(5) Husband shall return all non-marital personal property belonging to Wife in Husband’s possession.

(6) Husband shall be solely responsible for the payment of the balance owed on the following obligations:

(a) Chase Bank Visa credit card ($3,018.39).

(b) Upper Halfmoon Water Company ($762.93).

(7) Husband shall be responsible for payment of the following marital liabilities:

(a) Two loans taken against Husband’s TIAA-CREF retirement account.

(b) Automobile loan with Honda Finance Corporation for Husband’s 2003 Honda Civic.

(c) Obligation with Commercial Acceptance Corporation.

(8) Husband’s retirement benefits with TIAA-CREF shall be divided between Husband and Wife, with Husband to receive a 69 percent share and Wife to receive a 31 percent share of the benefits that have accrued until October 10, 2003. This division shall be effective as of October 10,2003, the date of the parties’ separation, and shall include any increase or decrease in Wife’s proportionate share until the date the separate account for Wife has been created and funded. Once the total value of Wife’s share of these benefits has been calculated by TIAA-CREF, the amount due Wife shall be reduced by $10,000, this being the total of the advance payments made by plaintiff since the parties’ separation. This $ 10,000 shall remain in Husband’s account. The transfer of the 31 percent interest in this account to Wife shall be accomplished through a Qualified Domestic Relations Order (Q.D.R.O.) that will be prepared by an actuary who shall value the TIAA-CREF account pursuant to 23 Pa. C.S. §3501(c), which requires any increase in retirement benefits post-separation to be included in marital property as long as the increase is not attributable to the efforts or contributions of the participant spouse. This Q.D.R.O. shall be approved by counsel for both parties, submitted for approval to the plan administrator for TIAA-CREF, and, following approval by the said plan administrator, submitted to the court for its approval. The domestic relations order shall be sent in final form to the aforesaid plan administrator for TIAA-CREF for the qualification of the order and the transfer of the required funds. The remaining amount of Husband’s retirement account with the TIAA-CREF shall remain the sole property of Husband. All costs incurred in the preparation and approval of this Q.D.R.O., including the invoice for the services of an actuary, shall be paid by Husband.

It is further ordered as follows:

(1) Effective immediately, the payment for alimony pendente lite previously required by this court in its order dated February 9,2006, shall cease. Husband shall now be obligated to begin payments of alimony to Wife as follows:

(a) Commencing January 1, 2008, Husband shall pay alimony in the amount of $2,400 per month. These payments shall continue until June 30,2010, one year beyond the anticipated date of completion of Wife’s undergraduate studies. In the event Wife elects to pursue her Master’s degree within one year of the completion of her undergraduate studies, alimony in the same amount shall continue until one calendar year beyond the anticipated date of completion of those studies. All payments shall terminate upon the death of Wife.

(b) Husband shall maintain a life insurance policy on his life naming Wife as the sole primary and irrevocable beneficiary of the death benefits until the death of Husband, the death of Wife, or Wife’s completion of her education, whichever event shall first occur. Husband shall at all times keep the policy in full force and effect, shall promptly pay any and all dues, premiums, and assessments thereon, shall not borrow against or encumber the same, and shall promptly show the paid premium receipts to Wife upon written request. The life insurance policy shall be in the form of an annuity or any comparable insurance policy, allowing for monthly payments, in accordance with item (a) above, to continue in the event Wife is predeceased by husband.

(2)The costs of transcribing both hearings ($774.80) shall be the sole responsibility of Husband. If not already paid, this obligation shall be satisfied by Husband within 60 days from the date of this order.

(3)Husband shall pay the sum of $4,310.31 to Goodall & Yurchak P.C., for legal services provided by that firm to Wife.

(4) Husband shall pay the sum of $2,100 to H. Denning Mason, Esquire, as the current attorney for Wife.

(5) Husband shall continue to provide COBRA payments for Wife’s health insurance pursuant to the terms of the order dated February 9, 2006.

(6) Husband shall continue to provide tuition discount payments pursuant to the terms of the order dated February 9, 2006.

(7) Except as set forth herein, all claims by either Husband or Wife for spousal support, alimony pendente lite, alimony, counsel fees, costs, and equitable distribution of property are hereby dismissed, with prejudice.


source: Caselaw Access Project

author: MOTTO, P.J.,

license: Public Domain

text:
    Commonwealth v. Herman

      Lawrence J. Keith, assistant district attorney, for the Commonwealth.

      Kenneth A. Kasenter, assistant public defender, for defendant.
    January 4, 2008
   MOTTO, P.J.,

The issue before the court for disposition is whether the defendant can be ordered to pay for restitution for bronze vases found missing from the premises of the victim, Graceland Cemetery, after defendant entered a guilty plea and was sentenced on a charge of criminal mischief relating to 14 bronze vases which defendant removed from the cemetery and which were recovered.

On September 18,2006, a criminal complaint was filed against the defendant charging the defendant with the offenses of desecration or sale of venerated objects, a misdemeanor of the second degree, in violation of section 5509 of the crimes code; criminal attempt, a misdemeanor of the first degree, in violation of section 901 of the Crimes Code; and criminal mischief, a misdemeanor of the second degree, in violation of section 3304 of the Crimes Code. As to each charge, the criminal complaint alleges that the defendant did remove 14 bronze cemetery vases from grave sites within Graceland Cemetery on or about Monday, August 28, 2006.

The affidavit of probable cause attached to the complaint indicates that the groundskeeper notified police after recovering two duffle bags containing 14 bronze vases which were found to be removed from plots nearby. Police investigation linked the duffle bag containing the vases to the defendant. The defendant was charged as aforesaid as the result of the police investigation. Neither the complaint nor the affidavit of probable cause references any other missing vases from the cemetery separate from the 14 vases contained in the duffle bags linked to the defendant.

On November 1, 2006, a criminal information was filed against the defendant charging the same offenses as set forth in the criminal complaint; however, the information references bronze cemetery vases removed from grave sites within Graceland Cemetery but does not state the number of bronze vases removed.

On August 7,2007, defendant entered a plea of guilty to the offense of criminal mischief, a misdemeanor of the second degree, in violation of section 3304(a)(5) of the Crimes Code. At the plea hearing, the Honorable Michael J. Wherry, Specially Presiding, asked how many vases defendant was accused of taking. The response from counsel for the Commonwealth and the defendant was that 14 vases were taken and they were recovered. The defendant specifically responded that he was in the process of taking the vases, and someone came out, so he just left them and ran. (Notes of Testimony, August 7, 2007, pp. 24-26.)

At the sentencing hearing, the victim requested restitution in the amount of $6,972 representing the value of 54 vases that were represented as having been found missing at about the same time that the 14 vases that constituted the basis for the within charges were taken. The 54 vases for which the Commonwealth seeks restitution were never recovered. The court included in its sentencing order the restitution requested by the Commonwealth. Subsequent to sentencing, the defendant filed a timely motion for a restitution hearing to address the legal amount of restitution that the defendant can be ordered to pay. The defendant contends that the restitution sought by the Commonwealth represents restitution for items that were not included within the original charges filed in this case and therefore defendant cannot be ordered to pay restitution for such items.

The authority of the court to order restitution is addressed in the Crimes Code. 18 Pa.C.S. §1106 addresses the subject matter of restitution for injuries to person or property. Such section provides in relevant part as follows:

“(a) General rule. — Upon conviction for any crime wherein property has been stolen, converted or otherwise unlawfully obtained,... the offender shall be sentenced to make restitution in addition to the punishment prescribed therefore.”

In determining the amount of restitution to be ordered, the sentencing court must consider the loss or damage directly caused by defendant’s criminal act. Commonwealth v. Reed, 374 Pa. Super. 510, 543 A.2d 587 (1988). An award of restitution which is not supported by the record will be vacated. The defendant’s criminal conduct must have caused the loss or injury for which compensation is ordered. Commonwealth v. Balisteri, 329 Pa. Super. 148, 478 A.2d 5 (1984). It has been held that the “but for test” is used to calculate the amount of restitution; damages which occur as a direct result of the crime are those that would not have occurred but for the defendant’s criminal conduct, and the sentencing court may not require payment in excess of damages the defendant caused. Commonwealth v. Gerulis, 420 Pa. Super. 266, 616 A.2d 686 (1992), appeal denied, 535 Pa. 645, 633 A.2d 150 (1993). A sentence requiring a defendant to make restitution for a loss which he did not cause is an illegal sentence. Commonwealth v. Reed (supra).

Restitution may be imposed pursuant to 18 Pa.C.S. § 1106 only for those crimes to property where the victim suffered a loss that flows from the conduct that forms the basis of the crime for which the defendant is held criminally accountable. Commonwealth v. Dohner, 725 A.2d 822 (Pa. Super. 1999).

In applying the foregoing principles to the facts of this case, it is clear that the court cannot order restitution for vases found missing from the cemetery, but relative to which the defendant was not charged with any theft offense. The defendant was specifically charged in the criminal complaint with removing 14 bronze cemetery vases from separate grave sites within Graceland Cemetery and placing them in two duffle bags. These specific vases contained within the two duffle bags were recovered by the groundskeeper. Although the representatives of the victim testified at sentencing that 54 additional vases were found missing, there is nothing in the record to support a finding that the defendant was responsible for the additional missing vases, nor was the defendant ever charged with any theft offenses relative to the additional missing vases.

At the plea hearing, defendant entered a plea to criminal mischief, a misdemeanor of the second degree, in violation of section 3304(a)(5) of the Crimes Code. Although the plea agreement called for restitution, counsel for the defendant advised the court that the vases were removed and found so it was not known whether or not any restitution was owed. The court specifically asked how many vases the defendant was accused of taking relative to which counsel for the defendant responded, “14”. (See Notes of Testimony, August 7, 2007, pp. 24-26.) The entire plea hearing and the colloquy between the defendant’s counsel and the court focused on this case involving a theft of 14 vases which were in fact recovered. No contention was ever made that the defendant was responsible for any additional vases until the victim requested restitution for the additional vases at the time of sentencing. However, no evidence has ever been set forth from which it can be found that the defendant was responsible for the theft of any vases or venerated obj ects other than the vases that were recovered and found in the duffle bags left at the scene and recovered by the groundskeeper.

Here, since the Commonwealth cannot demonstrate that the restitution requested relates to loss suffered by the victim as a direct result of the crime for which the defendant was charged, the court cannot lawfully order the defendant to pay the requested restitution. The vases which form the basis for the charges are the 14 vases which were in fact recovered. Since they were recovered and no loss was claimed as the result of the taking of the recovered vases, there is no additional restitution that can be ordered. Although the victim clearly suffered a loss relative to the additional bronze vases taken from its cemetery, the simple fact is that the record does not support any finding that the defendant was responsible for this additional loss. The above authorities cited herein clearly demonstrate that this court does not have the authority to order the requested restitution. Accordingly, the sentencing order shall be modified consistent with this opinion.

ORDER

And now, January 4, 2008, following a restitution hearing, it is ordered and decreed that the sentencing order dated September 6,2007 is hereby modified to the extent that the provision thereof requiring that the defendant shall pay restitution in the amount of $6,972 owed to Graceland Cemetery at 216 Cemetery Lane, New Castle, PA, 16105, payable through the Adult Probation Office of Lawrence County, is hereby deleted and vacated, and no restitution is owed by the defendant. All other aspects of the sentencing order dated September 6, 2007 not inconsistent with this modification shall continue in full force and effect.


author: BERNSTEIN, J.,

text:
    Tower Investments Inc. v. Rawle & Henderson

      Elizabeth Cipolletti, for plaintiffs.

      Nicole J. Rosenblum, Ronald P Schiller and Phillip E. Wilson Jr., for Zurich American and Assurance Co. of America.

      Peter J. Hoffman, Maureen P. Fitzgerald and Melissa B. Gorsline, for Rawle & Henderson.

      March 3, 2008
   BERNSTEIN, J.,

Plaintiffs Tower Investments Inc., Liberty Homes Philadelphia Inc., and Bart Blatstein filed this suit against defendants Rawle & Henderson LLP (R&H), Zurich American Insurance Company, and Assurance Company of America. In their second amended complaint, plaintiffs allege that they had a commercial liability insurance policy with Assurance and that Assurance retained R&H to defend plaintiffs in an underlying action pursuant to its duty to defend within the policy. Plaintiffs further allege that as part of the settlement in the underlying action, R&H executed a release that it knew plaintiffs objected to and was contrary to plaintiffs’ interests.

Plaintiffs have brought four counts against R&H: professional negligence (Count I), breach of contract (Count II), breach of fiduciary duty (Count III), and punitive damages (Count IV). Presently before the court are R&H’s preliminary objections to plaintiffs’ second amended complaint. For the reasons discussed below, said preliminary objections are overruled.

I. R&H’S Preliminary Objection in the Nature of a Demurrer and Motion To Strike Count II of Plaintiffs’ Second Amended Complaint Is Overruled

Count II of plaintiffs’ second amended complaint purports to state a claim for breach of contract against R&H. Plaintiffs allege that R&H breached its contractual obligations to plaintiffs by failing to provide legal services in a manner consistent with the standard of care for lawyers in Pennsylvania. R&H contends that this cause of action should be dismissed because there was no contract between plaintiffs and R&H.

In considering preliminary objections, “[a] 11 material facts set forth in the complaint as well as all inferences reasonably deducible therefrom are admitted as true for the purpose of this review.” “The question presented by a demurrer is whether, on the facts averred, the law says with certainty that no recovery is possible.” Any doubts as to whether a demurrer should be sustained shall be resolved in favor of overruling it. “The test on preliminary objections is whether it is clear and free from doubt from all the facts pleaded that the pleader will be unable to prove facts legally sufficient to establish his right to relief.”

In their second amended complaint, plaintiffs allege that they had an insurance liability contract with Assurance. Plaintiffs further allege that Assurance retained R&H to defend plaintiffs in the underlying action pursuant to its duty to defend in the insurance liability contract, and that Assurance agreed to pay R&H’s fees in consideration for its services. Accepting these facts as true, plaintiffs could potentially be considered third-party beneficiaries of the agreement between Assurance and R&H because plaintiffs were to receive the benefits, i.e., legal representation, from said agreement. If plaintiffs are found to be third-party beneficiaries of the agreement between Assurance and R&H, they would have the same rights as the original contracting parties, including the right to bring a breach of contract claim. Since the agreement between Assurance and R&H is not attached to or clearly set forth in the second amended complaint, doubts exist as to whether plaintiffs were intended third-party beneficiaries of the agreement between Assurance and R&H. As such, R&H’s demurrer to plaintiffs’ breach of contract claim is overruled.

II. R&H’S Preliminary Objection in the Nature of a Demurrer and Motion To Strike Count III of Plaintiffs’ Second Amended Complaint Is Overruled

In Count III of plaintiffs’ second amended complaint, plaintiffs allege that R&H owed a fiduciary duty to plaintiffs and that R&H breached that duty. When a liability insurer retains counsel to defend an insured, the insured is considered the client. Plaintiffs in this matter would be considered the clients of R&H. The relationship between an attorney and his client is a fiduciary relationship. This concept of a fiduciary relationship “by definition does not permit conflicts of interest.” “At common law, an attorney owes a fiduciary duty to his client; such duty demands undivided loyalty and prohibits the attorney from engaging in conflicts of interest, and breach of such duty is actionable.” “If a conflict of interest arises between an insurer and its insured, the attorney representing the insured must act exclusively on behalf of and in the best interests of the insured.”

In support of their claim that R&H breached its fiduciary duty, plaintiffs allege that R&H continued to represent plaintiffs despite the existence of a conflict of interest between plaintiffs and co-defendant Assurance. Specifically, plaintiffs have pled that Assurance decided to go forward with the settlement in the underlying action despite the fact that it knew that plaintiffs objected to certain terms of the settlement. Plaintiffs further allege that although R&H represented the interests of both Assurance and plaintiffs, R&H did not inform plaintiffs that a conflict of interest arose when the insurer (Assurance) and insured (plaintiffs) wanted to take two contrary approaches to settlement. Such allegations are sufficient to show divided loyalties and a potential conflict of interest. Therefore, R&H’s demurrer to Count III is overruled.

III. R&H’S Preliminary Objection in the Nature of a Motion To Strike Paragraphs 67(j) and 85(f) of Plaintiffs ’Second Amended Complaint Pursuant to Pa.R.C.P 1028(A)(2) Is Overruled

R&H next argues that paragraphs 61(f) and 85(f) of plaintiffs’ second amended complaint should be stricken as impertinent pursuant to Pa.R.C.P. 1028(a)(2). Paragraphs 67 and 85 of plaintiffs’ second amended complaint list various ways in which plaintiffs allege that R&H was reckless, negligent, or grossly negligent in the representation of plaintiffs. Specifically, subpart (j) of paragraph 67 and subpart (f) of paragraph 85 both allege that R&H was negligent or grossly negligent for “violating their ethical obligation to plaintiffs as stated in sections 1.3, 1.4, and 1.7 of the Pennsylvania Rules of Professional Conduct.”

R&H is correct that a violation of the Rules of Professional Conduct alone does not give rise to a cause of action. However, here, plaintiffs have not based a cause of action on defendant’s alleged violations of the Rules of Professional Conduct; rather, these allegations form part of the basis for plaintiffs’ claims against R&H for professional negligence. Moreover, “the right of a court to strike impertinent matter should be sparingly exercised and only when a party can affirmatively show prejudice.” R&H has failed to show how these allegations prejudice it. As a result, R&H’s preliminary objection to strike paragraphs 67(j) and 85(f) is overruled.

IV. R&H’S Preliminary Objection in the Nature of a Demurrer As to Plaintiffs ’ Claim for Punitive Damages in Count IV of Plaintiffs ’ Second Amended Complaint Is Overruled

Count IV of plaintiffs’ second amended complaint purports to state a claim for punitive damages. A request for punitive damages cannot stand as an independent cause of action; rather, a request for punitive damages is incidental to a cause of action. Here, although plaintiffs have requested punitive damages in a separate count, their claim for punitive damages is incidental to their cause of action for breach of fiduciary duty.

“Punitive damages may be awarded for conduct that is outrageous, because of the defendant’s evil motive or his reckless indifference to the rights of others.” In order to award punitive damages, the defendant’s conduct must be “malicious, wanton, reckless, willful, or oppressive.” Significantly, punitive damages may be awarded for a breach of fiduciary duty by an attorney. Indeed, “the reasons for imposing punitive damages on an errant attorney are even more compelling than those where a non-attorney breaches a fiduciary or other tort duty to a plaintiff.”

“An attorney at law has been said to be a public officer. He is an officer of the court sworn to aid in the administration of justice and to act with all good fidelity both to his clients and to the court. The public have a deep and vital interest in his integrity. It is a matter of profound importance from every point of view that members of the bar be men of probity and rectitude, zealous to maintain relations of utmost honesty with their clients and solicitous to protect them against legal wrong. Unflinching fidelity to their genuine interests is the duty of every attorney to his clients. Public policy can hardly touch matters of more general concern than the maintenance of an untarnished standard of conduct by the attorney at law toward his client. The attorney and client do not deal with each other at arms’ length. The client often is in many respects powerless to resist the influence of his attorney. If that influence be vicious, untoward, criminal, the relation of trust is abused and becomes a source of wrong.”

As set forth above, plaintiffs have sufficiently pled a claim for breach of fiduciary duty. Therefore, plaintiffs may assert a claim for punitive damages against R&H in this instance.

V. R&H’S Preliminary Objection in the Nature of a Motion To Strike Allegations of Recklessness Based on Agency in Paragraph 85 of Plaintiffs ’ Second Amended Complaint Is Overruled

Finally, R&H argues that paragraph 85 of plaintiffs’ second amended complaint should be stricken because it states general allegations of recklessness based on agency. Paragraph 85 provides, in relevant part: “Defendant Rawle & Henderson, its authorized agents, servants, partners and employees acted with gross negligence, maliciously and with reckless disregard toward plaintiffs....” R&H argues that plaintiffs failed to identify with sufficient particularity, either by name or description, the alleged agents, servants, partners, and/or employees whose conduct was purportedly grossly negligent, malicious, and/or reckless. R&H contends that this is contrary to the mandate of Pa.R.C.P. 1019(a), which states that “ [t]he material facts on which a cause of action or defense is based shall be stated in a concise and summary form.”

“The purpose of the pleadings is to place the defendants on notice of the claims upon which they will have to defend.” In order for the court to determine whether the defendant has been put upon adequate notice of the claim against which he must defend, the court must not simply focus upon one portion of the complaint. “Rather, in determining whether a particular paragraph in a complaint has been stated with the necessary specificity, such paragraph must be read in context with all other allegations in that complaint.”

R&H contends that plaintiffs failed to identify in paragraph 85 the agents and/or employees who were allegedly negligent. However, when the second amended complaint is read in its entirety, it is evident that plaintiffs have identified John T. Donovan, Esquire and Thomas A. Kuzmick, Esquire, as employees of Rawle & Henderson, who acted on behalf of the law firm. Specifically, paragraph 6 of plaintiffs’ second amended complaint states that “[a]t all times relevant hereto defendant Rawle & Henderson, was operating by and through its authorized agents, servants, partners and employees including, but not limited to, John T. Donovan Esquire.” Further, paragraph 27 states that “John T. Donovan Esquire and Thomas A. Kuzmick Esquire, of Rawle & Henderson entered their appearance as lead counsel for the plaintiffs on May 21, 2003.” These allegations, coupled with the allegations of negligence against R&H in second amended complaint, are sufficient to place R&H on notice of the material facts necessary to prepare a defense. Thus, R&H’s preliminary objection is overruled.

CONCLUSION

For the foregoing reasons, defendant Rawle & Henderson LLP’s preliminary objections are overruled. Rawle & Henderson LLP is directed to file an answer to plaintiffs’ second amended complaint within 20 days from the date of entry of this order.

ORDER

And now, March 3, 2008, upon consideration of defendant Rawle & Henderson LLP’s preliminary objections, the response thereto, all other matters of record, and in accordance with the opinion being contemporaneously filed with this order, it hereby is ordered that said preliminary objections are overruled. Defendant Rawle & Henderson LLP is directed to file an answer to plaintiffs’ second amended complaint within 20 days from the date of entry of this order.

      . Plaintiffs have also brought a breach of contract claim against Assurance (Count V), which is not at issue here.

      . Employers Insurance of Wausau v. PennDOT, 581 Pa. 381, 388 n.5, 865 A.2d 825, 829 n.5 (2005). (citations omitted)

        . Id.

        . Id.

      . Bourke v. Kazaras, 746 A.2d 642, 643 (Pa. Super. 2000).

      . Complaint at ¶¶12-17.

      . Id at ¶¶25-26, 75.

      . “[A] party becomes a third-party beneficiary only where both parties to the contract express an intention to benefit the third party in the contract itself, unless, the circumstances are so compelling that recognition of the beneficiary’s right is appropriate to effectuate the intention of the parties, and the performance satisfies an obligation of the promisee to pay money to the beneficiary or the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance.” Scarpitti v. Weborg, 530 Pa. 366, 372-73, 609 A.2d 147, 150-51 (1992). (citations omitted)

      . See Miller v. Allstate Insurance Company, 763 A.2d 401, 404 n.1 (Pa. Super. 2000) (“Under Pennsylvania law, a third-party beneficiary’s rights and limitations in a contract are the same as those of the original contracting parties”).

      . Bedwell Co. v. D. Allen Bros., 2006 Phila. C.C.P. Lexis 459, *7 (Commerce Program 2006), citing Rector, Wardens and Vestryman of St. Peter’s Church v. Am. Nat’l. Fire Ins. Co., 2002 U.S. Dist. Lexis 625 (E.D. Pa. 2002); Builders Square v. Saraco, 1996 U.S. Dist. Lexis 19444 (E.D. Pa. Dec. 27, 1996); Point Pleasant Canoe Rental Inc. v. Tinicum Township, 110 F.R.D. 166, 170 (E.D. Pa. 1986).

      . Maritrans GP Inc. v. Pepper, Hamilton & Scheetz, 529 Pa. 241, 261, 602 A.2d 1277, 1287 (1992).

      . Id. (emphasis in original)

      . Id. at 253, 602 A.2d at 1283.

      . Bedwell, 2006 Phila. C.C.P. Lexis 459, *7, citing Rector, Wardens and Vestryman of St. Peter’s Church v. Am. Nat’l. Fire Ins. Co., 2002 U.S. Dist. Lexis 625 (E.D. Pa. 2002).

      . Complaint at ¶66.

      . Id. at ¶¶41,47.

      . Id. at|58.

      . See Maritrans, 529 Pa. at 256, 602 A.2d at 1284.

      . Commonwealth Department of Environmental Resources v. Hartford Accident and Indemnity Company, 40 Pa. Commw. 133, 138, 396 A.2d 885, 888 (1979).

      . It is also noted that “there is some authority for the proposition that, even if the pleading of damages was impertinent matter, that matter need not be stricken but may be treated as ‘mere surplusage’ and ignored.” Itskowitz v. White & Williams LLP, 2004 Phila. C.C.P. Lexis 34, *16 (Commerce Program 2004), quoting Commonwealth Department of Environmental Resources v. Hartford Accident and Indemnity Co., 40 Pa. Commw. 133, 137, 396 A.2d 885, 888 (1979). The court is well aware that the Rules of Professional Conduct are not rules of evidence and do not have the force of substantive law. West Conshohocken Restaurant Associates Inc. v. Flanigan, 737 A.2d 1245, 1248 (Pa. Super. 1999).

      . Nix v. Temple University of the Commonwealth System of Higher Education, 408 Pa. Super. 369, 380, 596 A.2d 1132, 1138 (1991); Hilbert v. Roth, 395 Pa. 270, 276, 149 A.2d 648, 652 (1959) (stating that “the right to punitive damages is a mere incident to a cause of action ... and not the subject of an action in itself’).

      . Feld v. Merriam, 506 Pa. 383, 395, 485 A.2d 742, 747 (1984), citing Restatement (Second) Torts §908(2).

      . Id. at 395, 485 A.2d at 747-48. (citations omitted)

      . Rizzo v. Haines, 520 Pa. 484, 507-508, 555 A.2d 58, 69 (1989).

      . Axcan Scandipharm Inc. v. Reed Smith LLP, 2007 Phila. C.C.P. Lexis 78, *16-17 (Commerce Program 2007), citing Feld & Sons Inc. v. Pechner, Dorfman, Wolfee, Rounick & Cabot, 312 Pa. Super. 125, 140-41, 458 A.2d 545, 553 (1983).

      . Id.

      . Yacoub v. Lehigh Valley Medical Associates P.C., 805 A.2d 579, 588 (Pa. Super. 2002).

      . Id. at 589.

      . Id.


author: TERESHKO, J.,

text:
    Array Healthcare Facilities Solutions Inc. v. Pesce

      Harold I. Goodman, for plaintiff.

      Matthew ChabalHI, Jeffrey M. McCormick, James D. Hollyday, Steven J. Engelmyer and Paul G. Gagne, for defendants.
    November 9, 2006
   TERESHKO, J.,

PROCEDURALHISTORY

Defendants Array Healthcare Facilities Solutions Inc., Douglas C. Lindsay and Patricia D. Malick appeal from the court’s order dated May 23, 2006, denying their preliminary objections.

FACTUAL BACKGROUND

Plaintiff Domenic Pesce was an architect and planner whose work focused primarily on the design and planning of healthcare facilities. (Complaint, ¶10.) In November 2002, the company of BLM/CRAInc., which is a predecessor company to defendant Array, hired Pesce as chief financial officer of its planning division. (Complaint ¶12.)

On or about May 2004, Array and Pesce orally agreed to certain terms and conditions for Pesce to assume the role of president of Array, an architectural practice, which centers on the design and planning of healthcare facilities. (Complaint, ¶¶11-13.) Pursuant to the oral agreement, Pesce alleges he was to receive an annual base salary of $160,000; a guaranteed annual bonus of $90,000; stock and membership on Array’s board of directors. (Complaint, ¶16.) Also in May, Pesce became a party to a shareholder’s agreement (buy-sell agreement) with BLM/CRA Inc. Pursuant to the consent form attached to the buy-sell agreement executed May 11,2004, Pesce was to receive two stock certificates evidencing his ownership of 14,702 shares of Array stock (approximately 11 percent of the company’s outstanding shares). (Responses to preliminary objections, p. 4, complaint, exhibit B.) Pursuant to the “Notice of preemptive rights for the issuance of new shares of BLM/CRA Inc.,” the board of directors of BLM/CRA Inc. agreed to sell one stock certificate evidencing 3,776 shares to Pesce for the purchase price of $81,447. (Complaint, exhibit B.) The remaining stock certificate evidencing 10,926 was purchased by Pesce at a later date. Although section 17 of the buy-sell agreement between BLM/CRA Inc. d/b/a BLM Architects contains an arbitration clause, none of the several drafts of the employment agreement between Pesce and Array contain any arbitration clause.

Shortly after entering into the oral agreement, Array submitted a written employment agreement. The written agreement purportedly did not reflect the oral representations made in the oral agreement. (Complaint, ¶18.) Pesce informed chief financial officer and senior vice president of Array, Carl Davis, of the inaccuracies in the written agreement and neither Pesce nor Array executed the written agreement. Despite the failure to execute a written agreement, Pesce began employment as president in May 2004. (Complaint, ¶19.)

In June 2005, approximately one year after the written employment agreement was rejected by both parties, Davis provided Pesce with a revised written agreement. (Complaint, ¶21.) Once again, the terms did not conform to the oral agreement first agreed upon by the parties.

On June 13, 2005, Pesce gave to Davis a second revised written agreement that included handwritten amendments by Pesce to the parties’ earlier oral agreement. (Complaint, ¶23.) Although Pesce signed the second revised written agreement, it was never executed by any member of Array.

In October 2005, Pesce was informed by the accountant who worked at Array, that Davis believed Pesce and the accountant were having an affair. The accountant further explained that her husband also believed this to be the situation. (Complaint, ¶26.)

However, Pesce asserts that he became aware that the accountant and Davis were currently having the ongoing affair. (Complaint, ¶27.)

The accountant further explained that because of her husband’s mistaken belief that Pesce was involved in the affair with her, Pesce was potentially in danger. (Complaint, ¶28.) In addition to the contention about extramarital affairs within the office, Pesce was further informed by the accountant that Davis had written an unauthorized check in the amount of $ 168,000 without the prior knowledge or approval of Pesce. (Complaint, ¶29.)

Pesce confronted Davis about these allegations. When Davis refused to take any actions to remedy these issues, Pesce informed the board of directors that Davis may have engaged in financial misconduct in violation of the company’s resolutions of the board of directors. (Complaint, ¶32.) In addition, Pesce requested an independent third-party investigation into Davis’ conduct, as well as into Array’s accounting and IT practices and controls. Pesce also requested Array to provide personal protection for himself and his family. Id.

According to Pesce, Davis, in response to these reported allegations, falsely stated to Array board members that Pesce was mentally unstable and that he was stealing clients from Array. Pesce also alleges that defendant Douglas Lindsay, who is the chief executive officer of Array, falsely stated that Pesce requested to be demoted from his position as president. (Complaint, ¶37.)

Pesce stated that on October 27, 2005, he was demoted to director of planning without cause or justification by the board of directors of Array. (Complaint, ¶40.) He states that this was a result of an inadequate investigation into the aforementioned issues by the Array board. Following the demotion, Pesce’s base salary was reduced from $ 160,000 to $ 115,000; he was also denied his guaranteed bonuses of $90,000 for his performance in 2004 and 2005. (Complaint, ¶43.) Pesce was also removed as a shareholder and relinquished of his rights to any stock ownership and was denied earned shareholder distributions totaling approximately $50,000. (Complaint, ¶46.) In addition, Pesce was also denied other fringe benefits as a result of the promotion. (Complaint, ¶¶47-49.) Plaintiff states, that when he obtained the services of legal counsel to send correspondence to Davis and Lindsay outlining what Pesce believed to be unlawful conduct which demanded remediation, he was terminated without cause or justification, contraiy to his employment agreement, without any severance package. (Complaint, ¶51.)

Plaintiff instituted this action March 7,2006, alleging various claims for breach of contract, defamation, intentional infliction of emotional distress, wrongful discharge and violation of the Pennsylvania Wage Payment and Collection Law.

On April 26, 2003, defendants filed their preliminary objections to plaintiff’s complaint and plaintiff filed responses thereto. By order dated May 23, 2006, the trial court overruled the defendants’ preliminary objections and ordered defendants to file their answers to the complaint.

On June 14,2006, defendants filed their notice of appeal to the May 23,2006 order and issued their 1925(b) statement of matters accordingly.

The sole issue on appeal is whether the trial court committed an error of law and/or abuse of discretion in overruling the preliminary objections pertaining to the arbitration clause in the buy-sell agreement, wherein the plaintiff’s claims for breach of contract are separate and distinct from the buy-sell agreement.

LEGAL ANALYSIS

Where any doubt exists as to whether a demurrer should be sustained, it must be resolved in favor of overruling the demurrer. Kyle v. McNamara & Criste, 506 Pa. 631, 487 A.2d 814 (1985); Baker v. Magnetic Analysis Corporation, 347 Pa. Super. 188, 500 A.2d 470 (1985). The question presented by the demurrer is whether, on the facts averred, the law says with certainty that no recovery is possible. Kyle v. McNamara & Criste, 506 Pa. at 634, 487 A.2d at 816. A demurrer should be sustained only in cases where the plaintiff has clearly failed to state a claim upon which relief may be granted. Eckell v. Wilson, 409 Pa. Super. 132, 597 A.2d 696 (1991). A demurrer should not be sustained if there is any doubt as to whether the complaint adequately states a claim for relief under any theory of law. Id. In reviewing the complaint, we are to regard all well-pleaded facts as true and to give plaintiff the benefit of all favorable inferences that we could fairly deduce from these facts. See Mazzagatti v. Everingham, 512 Pa. 266, 516 A.2d 672(1986).

Since the sustaining of a demurrer results in a denial of the pleader’s claim or a dismissal of his suit, a preliminary objection in the nature of a demurrer should be sustained only in cases that clearly and without a doubt fail to state a claim for which relief may be granted. Schott v. Westinghouse Electric Corporation, 436 Pa. 279, 259 A.2d 443 (1969). If the facts as pleaded state a claim for which relief may be granted under any theory of law then there is sufficient doubt to require the preliminary objection in the nature of a demurrer to be rejected. Packler v. State Employes Retirement Board, 470 Pa. 368, 371, 368 A.2d 673, 675 (1977).

The appellate court’s standard of review of a denial of preliminary objections in the nature of a petition to compel arbitration “is limited to determining whether the trial court’s findings are supported by substantial evidence and whether the trial court abused its discretion in denying the petition.” Midomo Company Inc. v. Presbyterian Housing Development Co., 739 A.2d 180, 186 (Pa. Super. 1999).

Where a party to a civil action seeks to compel arbitration of that action, a two-part test is employed to determine if arbitration is required. First, the trial court must determine if a valid agreement to arbitrate exists between the parties. Id. Second, if the trial court determines that such an agreement does exist, it must then determine if the dispute involved is within the scope of the arbitration provision. Id. “[T]he scope of arbitration is determined by the intention of the parties as ascertained in accordance with the rules governing contracts generally.” Henning v. State Farm Mutual Automobile Insurance Company, 795 A.2d 994, 996 (Pa. Super. 2002). “Arbitration is a matter of contract and, as such, it is for the court to determine whether an express agreement between the parties to arbitrate exits.” Smith v. Cumberland Group Ltd., 455 Pa. Super. 276, 687 A.2d 1167, 1171 (1997).

As noted above, in May 2004, Mr. Pesce became a party to a shareholder’s agreement “buy-sell agreement” with Array. Pursuant to this agreement, Mr. Pesce received two stock certificates evidencing his ownership of 14,702 shares of Array stock.

In the course of Mr. Pesce’s demotion and termination from Array, he was removed as a shareholder of Array and stripped of his ownership of all Array stock. The buy-sell agreement contains both an arbitration provision (section 17) and a forum selection clause (section 21.1). The arbitration provision provides that disputes “arising out of, under, in connection with, or in relation to” the agreement shall be subject to arbitration. The forum selection clause provides that “any suit or action arising out of, under, in connection with, or in relation to” the agreement shall have a venue of Cumberland County. In addition to his removal as shareholder and ownership of the stock, Pesce was additionally denied an earned shareholder distribution totaling approximately $50,000. To the extent Pesce relies at all on the buy-sell agreement in his complaint, it is to compel specific performance that Array purchase all of the terminated shareholder’s shares under section 5 of the buy-sell agreement.

It is defendants’ position that the broad language of these provisions requires that either the entire action be submitted to arbitration or that it be transferred to Cumberland County. The shareholder’s agreement, on its face, is intended to address the transfer of Array stock, not to govern the employment relationships among Array and its shareholders. The plaintiff’s contention in this action is based on a breach of the employment contract. Thus, defendants cannot use the shareholder’s agreement as a vehicle either to shift the venue of this entire action to another forum or to send it to arbitration.

“A court may only compel a party to arbitrate where that party has entered into a written agreement to arbitrate that covers the dispute.” Bel-Ray Co. Inc., v. Chemrite Ltd., 181 F.3d 435, 440 (3d Cir. 1999). “As a matter of contract, no party can be forced to arbitrate unless that party has entered into an agreement to do so.” Painewebber Inc. v. Hartmann, 921 F.2d 507, 511 (3d Cir. 1990). “Arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed to submit.” Sandvik v. Advent Int ’l Corp., 220 F.3d 99, 105 (3d Cir. 2000). However, a party “can be compelled to arbitrate under an agreement, even if he or she did not sign that agreement, if common-law principles of agency and contract support such an obligation on his or her part.” Bouriez v. Carnegie Mellon University, 359 F.3d 292, 294 (3d Cir. 2004).

Our Superior Court has stated that there is no appreciable difference between Pennsylvania law and the provisions of the FAA on the enforceability of agreements to arbitrate. Lytle v. Citifinancial Services Inc., 810 A.2d 643, 656 (Pa. Super. 2002). A court must apply traditional principles of contract interpretation in order to determine whether an arbitration clause exists. Id.

In United States SBA v. Chimicles, 2004 U.S. Dist. Lexis 20333, *15, (aff'd, United States SBA v. Barrack, 447 F.3d 207 (2006)), the Third Circuit Court of Appeals held that where a limited partnership agreement that contains an arbitration clause cannot be incorporated by reference into a related but separately executed subscription agreement, which does not contain any such clause. The court stated that they are “independent documents ’’ and cannot be construed as one for enforcement purposes. Id. (emphasis added) The court went on to say that the lack of an arbitration clause in the limited partnership agreement indicates intent not to arbitrate disputes arising from that agreement. Id.

In upholding Chimicles, the Barrack court highlighted the fact that both the subscription agreement and the partnership agreement had integration agreements. The Barrack court stated,

“Section 3.5 of the subscription agreements provides that ‘[tjhis instrument contains the entire agreement of the parties, and there are no representations, covenants or other agreements except as stated or referred to herein.’ Likewise, section 13.6 of the partnership agreements provides that ‘[tjhis agreement constitutes the complete and exclusive statement of the agreement between the partners.’ ” Barrack, 447 F.3d at 210.

Much like in Barrack and Chimicles, section 20.8 of the buy-sell agreement states,

“This agreement, together with any agreement note, or other instrument or document executed or to be executed pursuant to the terms and conditions of this agreement, constitutes the entire agreement of the parties with respect to the subject matter hereof and replaces and supersedes any and all prior oral or written agreements, representations and discussions pertaining to the subject matter hereof or thereof.”

Section 11.0 of the employment agreement also contains an integration clause which states,

“This agreement contains the entire agreement of the parties with regard to the subject matter hereof and supersedes any and all prior oral or written understandings and agreements between them. This agreement may be amended or modified only by an agreement in writing signed by both parties.”

The Barrack court also found that in determining whether the parties intended to be bound by an arbitration clause in one of the contracts, we must look at the parties who entered into the contract and the party bringing the action. In examining this principle the court stated,

“First, the agreement to arbitrate was made between the general partner and the private limited partners — i. e., the signatories to the partnership agreement. Second, section 13.7 emphasizes that the arbitration clause was intended to apply to (1) actions to enforce provisions of the partnership agreement and (2) actions brought by the private limited partners.” Id.

According to the facts as asserted by plaintiff, which must be given deference at this stage, there was an oral employment agreement and no valid written employment agreement between Pesce and Array. This oral employment agreement did not have or incorporate an arbitration clause. The buy-sell agreement, which was a separate written agreement entered into between Pesce and the shareholders ofBLM/CRA, was entirely distinct because Array was not a party to it. The arbitration clause was only binding as to the contract between plaintiff and BLM/CRA. According to the rationale of the Barrack court, the lack of any contractual relationship between Array and Pesce at time of signing the buy-sell agreement (which was between BLM/CRA and Pesce) further indicates that separateness and independence of this document from the oral employment agreement between Pesce and Array. Therefore, the jurisdiction over the Pesce’s case is not influenced by the arbitration clause included in the buy-sell agreement and is properly before the court of common pleas.

Lastly, in comparing the relationship of the documents at issue in Chimicles to the documents in this case, the limited partnership agreement and the subscription agreement are more closely related documents than the buy-sell agreement and the employment agreement in this case, because the Chimicles documents touch upon the specific issue of the company’s partnership parameters. The buy-sell agreement and the employment agreement do not touch on such a specific issue, rather they encompass more disparate issues of Pesce’s employment (employment agreement) and the option to purchase the predecessor company’s fringe benefits that were offered for him (buy-sell agreement).

Thus, according to the case law, the employment agreement and the buy-sell agreement are independent documents and the arbitration clause of the buy-sell agreement cannot be said to apply to Pesce’s employment agreement.

Despite this court’s finding that the entire action should not be transferred to arbitration pursuant to the buy-sell agreement, the court does not intend to split the issues with respect to the buy-sell agreement and the employment contract into two separate actions. Rather, pursuant to Pa.R.C.P. 213.1, this court wishes to keep these actions together and within the jurisdiction of the Philadelphia Court of Common Pleas, because both agreements arise out of the same transaction or occurrence.

The buy-sell agreement and its arbitration clause encompasses only one aspect of the recovery sought under the complaint. Pesce seeks compensation for salary, annual bonuses, membership on the board of directors and rights to purchase stock. Although the complaint does contain specific counts for recovery under the buy-sell agreement, the promotion of judicial efficiency and the minimization of delay, costs, redundancy and possibility of inconsistent verdicts that may occur from separate proceedings far outweigh any prejudice associated with coordination of actions in the Philadelphia Court of Common Pleas. See Pa.R.C.P. 213.1(a). Rule 213.1(a) provides for coordination of actions when there are proceedings pending in different counties which involve a common question of law or fact or which arise from the same transaction or occurrence. The interest in coordinating actions before the Philadelphia Court of Common Pleas would prevent having arbitration in Cumberland County pursuant to the buy-sell agreement and a trial in Philadelphia Court of Common Pleas on the employment agreement. This could also result in an inconsistent verdict with the findings of the Philadelphia Court of Common Pleas.

Taken into consideration the circumstances and weighing the judicial efficiency against any prejudices, the court properly determined that this action was one that should remain within the province of the Philadelphia Court of Common Pleas and not transferred to arbitration.

CONCLUSION

In light of the foregoing analysis, this court believes that defendants’, Array Healthcare Facilities Solutions Inc., Douglas C. Lindsay and Patricia D. Malick, preliminary objections, were properly denied, and respectfully requests that they be affirmed by the court above.

      . Some of the details of when and how Pesce acquired the stock certificates are unclear due to the vagueness of BLM’s resolution and notice of its board of directors. Although the “Notice of preemptive rights for the issuance of new shares of BLM/CRA Inc.” indicated that the 3,776 shares of stock were received on May 12,2004 in consideration for the purchase price of $81,447, it is not clear under what terms Pesce acquired the remaining shares. (See complaint, exhibit B.)

      . A subscription agreement is an application by an investor to join a limited partnership, http://financial-dictionary.com.