author: ZULICK, J.,

text:
    Aurora Loan Services, LLC v. Sheika

      C.P. of Monroe County,
    No. 4716 CV 2008

      Ralph M. Salvia, for plaintiff.

      Robert J. Kidwell, for defendants.
    August 28, 2013
   ZULICK, J.,

Defendants Samme Sheika and Eileen Sheika have filed a motion to set aside a sheriff’s sale and strike a sheriff’s deed in this mortgage foreclosure action. The case was commenced by Aurora Loan Services, LLC’s (Aurora) complaint filed in May, 2008 against real property (the property) owned by the Sheikas. Aurora obtained a default judgment in May, 2009, and was the successful bidder for 454 Birch Street, East Stroudsburg, Pennsylvania at sheriff’s sale in September, 2012. Aurora then filed a motion to set aside sheriff’s sale in June, 2012, but after failing to appear for argument, the motion was denied.

The Sheikas filed this motion to set aside sheriff’s sale and strike sheriff’s deed in May, 2013. The matter was argued on August 5, 2013, with both parties filing briefs in support of their position.

DISCUSSION

The Sheikas seek to have the sheriff’s sale and resulting deed set aside. Their sole argument is that the court lacked subject matter jurisdiction over the foreclosure action.

“It is...well settled that a judgment or decree rendered by a court which lacks jurisdiction of the subject matter or of the person is null and void and is subject to attack by the parties in the same court or may be collaterally attacked at any time.” Commonwealth ex rel. Howard v. Howard, 10 A.2d 779, 781 (Pa. Super. 1940).

[I]t is never too late to attack a judgment or decree for want of jurisdiction. That question is always open. Such a judgment is entitled to no authority or respect, and is subject to impeachment in collateral proceedings at any time by one whose rights it purports to affect. The want of jurisdiction over the subject matter may be questioned at any time. It may be questioned either in the trial court, before or after judgment, or for the first time in an appellate court, and it is fatal at any stage of the proceedings, even when collaterally involved..

DeCoatsworth v. Jones, 639 A.2d 792, 796 (Pa. 1994) (internal quotations and citations omitted) (emphasis deleted). Therefore, even though the mortgage foreclosure has been finalized, and the period to timely appeal has passed, if the court lacked subject matter jurisdiction in the foreclosure matter that judgment must be set aside.

The Sheikas’ contention that the court lacked subject matter jurisdiction in deciding the mortgage foreclosure is based upon a recent Superior Court case, Beneficial Consumer Discount Co. v. Vukman, 37 A.3d 596 (Pa. Super. 2012), reargument denied (Apr. 14, 2012), appeal granted, 55 A.3d 100 (Pa. 2012). Although now on appeal before our Supreme Court, the Superior Court’s decision in Vukman, remains binding precedent upon this court.

In Vukman, Beneficial Consumer Discount Co. (Beneficial) filed an action in mortgage foreclosure against Vukman due to failure to pay monthly payments due on the mortgage. Beneficial eventually obtained a judgment and purchased the property at sheriff’s sale. Vukman, 37 A.3d at 597-98.

After the sale, Vukman filed a motion to set aside the judgment and sheriff’s sale. Her contention was that the notice provided by Beneficial was inadequate, in that it failed to comply with the requirements of the Homeowners Emergency Mortgage Act, 35 P.S. §§ 1680.401(c) et seq. (Act 91). Specifically, she argued that the Act 91 notice she received failed to inform her of her right to a face to face meeting with Beneficial. The trial court held a hearing, and determined that the Act 91 notice was deficient, and set aside the sheriff’s sale and judgment. Vukman, 37 A.3d at 598. Beneficial appealed.

In affirming the trial court, the Superior Court stated:

At the time relevant to this matter, Section 1680.402c of Act 91 clearly and unambiguously provided that, before a mortgagee could, inter alia, commence a mortgage foreclosure action against a mortgagor, the mortgagee was required to give the mortgagor a notice as described in Section 1680.403c of Act 91. Pursuant to the plain language employed in Subsection 1680.403c(b)(l), this notice was to, inter alia, advise the mortgagor that the mortgagor has thirty days to have a face-to-face meeting with the mortgagee who sent the notice or a consumer credit counseling agency to attempt to resolve the delinquency or default. In other words, Subsection 1680.403c(b)(l) clearly and unambiguously required a mortgagee to provide to a mortgagor notice that the mortgagor had a choice of whether to meet face-to-face with the mortgagee or a consumer credit counseling agency. While Act 91 undeniably empowered the agency to prepare a uniform notice, the Legislature mandated that the notice include all of the information outlined by Act 91’s notice provision. 35 P.S. § 1680.403c(b)(l) (amended July 8, 2008, effective September 8, 2008) (“The agency shall prepare a notice which shall include all the information required by this subsection....”).
Here, the notice that Appellant provided to Appellee failed to inform Appellee that she could choose to meet face-to-face with Appellant. Consequently, the notice was deficient.

Id. at 602. The Superior Court ultimately determined:

Act 91 explicitly states that, before a mortgagee can even commence a mortgage foreclosure action, it must give the mortgagor the notice described in Section 1680.403c; Subsection 1680.403c(b)(l) clearly and unambiguously mandates that the notice must inform a mortgagor, inter alia, that the mortgagor can meet face-to-face with the mortgagee.
We conclude that the trial court did not make an error of law or abuse its discretion by sustaining Appellee’s “Motion to Set Aside Judgment and Sheriff’s Sale.” In conjunction with its ruling, the court properly set aside the sheriff’s sale, vacated the judgment, and dismissed Appellant’s complaint without prejudice. Accordingly, we affirm the court’s order.

Id. at 603-04.

Were the Vukman decision the final word on the matter, it is clear that the sheriff’s sale and deed must be set aside. However, approximately five months after the decision in Vukman, Pennsylvania enacted the Homeowner’s Assistance Settlement Act (HASA), 35 P.S. § 1681.1 et seq. The main thrust of HASA, as far as the present matter is concerned, is found in its provisions that “[t]he failure of a mortgagee to comply with the requirements of sections 402-C and 403-C of the Housing Finance Agency Law must be raised in a legal action before the earlier delivery of a sheriff’s or marshal’s deed in the foreclosure action or delivery of a deed by the mortgagor.” 35 P.S. § 1681.5(2), and, “[t]he failure of a mortgagee to comply with the requirements of sections 402-C and 403-C of the Housing Finance Agency Law shall not deprive a court of jurisdiction over any legal action, including an action in foreclosure, for money due under the mortgage obligation or to take possession of the mortgagor’s security.” 35 P.S. § 1681.5(3).

In Commonwealth v. Chamberlain, 731 A.2d 593 (Pa. 1999), our Supreme Court concluded that Section 1420 of the County Code, 16 P.S. § 1420, was amended to correct the Supreme Court’s decision concerning legislative intent in Commonwealth v. Lawson, 699 A.2d 1246 (Pa. 1997). The court stated that the legislation “eviscerated the holding and rationale of Lawson.” Chamberlain, 731 A.2d at 599. In amending Section 1420, the legislature specified in subsection (d) of the amendment, that it “shall apply to all cases pending on the effective date of this subsection and all cases thereafter, including, but not limited to, those cases on post-trial or on appeal.” See discussion in Com. v. Shaffer, 734 A.2d 840, 844 (Pa. 1999).

New legislation may create retroactive authority, so long as that legislative intent is clearly stated. Commonwealth v. Shaffer, supra at 843. However, “[i]t is clearly established in this jurisdiction that even though the legislature possesses the power to promulgate the substantive law, judicial judgments and decrees entered pursuant to those laws may not be affected by subsequent legislative changes after those judgments and decrees have become final.” Commonwealth v. Sutley, 378 A.2d 780, 784 (Pa. 1977).

HASA explicitly states that it is to apply retroactively to June 5, 1999. 35 P.S. § 1681.7. No final judgment interpreting the Vukman decision was issued in this matter by this court before HASA became law. Therefore, HASA is proper retroactive authority and supersedes the Vukman decision’s precedent in this case. The sheriff’s sale and deed are valid under HASA. They will not be set aside.

ORDER

And now, this 28th day of August, 2013, upon consideration of defendants’ petition to set aside sheriff’s sale and strike sheriff’s deed, and the briefs and arguments of both parties, it is ordered that the petition is denied.


source: Caselaw Access Project

author: SNITE, J,

license: Public Domain

text:
    CCI Communications, Inc. v. Richard F. Sassa Insurance Agency

      Harry P. Begier, Jr, for plaintiff.

      Christopher L. Troy and Jonathan R. MacBride, for defendant Employers Fire Ins. Co.

      Joseph P Connor, III, for additional defendant Richard F. Sassa Ins. Agency, Inc.
    August 30, 2013
   SNITE, J,

On July 18, 2013, this court ruled on a motion for summary judgment in the above captioned case. By order dated July 19, 2013, this court granted the summary judgment motion of additional defendant, The Richard F. Sassa Insurance Agency, Inc. On July 22, 2013, Plaintiff filed a motion for reconsideration of the court’s July 18,2013 order. On August 5,2013, this court denied plaintiff’s motion for reconsideration.

On August 16, 2013 this court received notice that plaintiff had filed an appeal to the Superior Court of Pennsylvania from this court’s July 18, 2013 order.

DISCUSSION

This court adopts, as its opinion on appeal, the order and opinion dated July 18, 2013, which sets forth this court’s reasoning, as well as this court’s order dated August 2, 2013. These opinions are incorporated herein by reference. This court asks that the July 18, 2013 order be affirmed.

ORDER

And now, this 2nd day of August, 2013, upon consideration of plaintiff’s motion for reconsideration of the court’s order of July 18, 2013, and additional defendant’s, The Richard F. Sassa Insurance Agency, Inc. (“Sassa”), response thereto, it is hereby ordered that said motion is denied.

ORDER

And now, this 18th day of July, 2013, upon consideration of additional defendant’s, The Richard F. Sassa Insurance Agency, Inc., motion for summary judgment, and all responses thereto, it is hereby ordered that said motion is granted. Plaintiff’s complaint is dismissed, in accordance with the accompanying memorandum opinion.

MEMORANDUM OPINION

Before the court is additional defendant’s, The Richard F. Sassa Insurance Agency (“Sassa”), motion for summary judgment, on the grounds that the statute of limitations for any negligence claim plaintiff, CCI Communications, Inc. (“CCI”), may have against Sassa has expired.

PROCEDURAL HISTORY

On May 19, 2010, CCI filed its Third Amended Complaint against The Employers’ Fire Insurance Company (“Employers”), for breach of contract, reformation, and bad faith. CCI’s complaint arises out of a fire loss that occurred on its premises on August 23,2007.

On August 27, 2010, Employers filed a joinder complaint against additional defendant Sassa, for a claim of negligence.

On October 15, 2010, Sassa filed its answer with new matter and cross-claim to Employer’s joinder complaint.

On October 12,2011, Sassa filed a motion for summary judgment. At the time of filing, CCI had settled all claims with Employers, as CCI’s counsel informed the court at the pretrial conference on August 25, 2011.

On October 31, 2011, Judge Bernstein granted Sassa’s motion for summary judgment, on the basis that any direct claim against Sassa was barred based on the statute of limitations, and the discovery rule did not apply. The court reasoned: “Plaintiff’s first-party insurance claim became actionable on August 23, 2007, the date the fire occurred. Since no claim was asserted against Sassa until August 27, 2010, any direct claim is now barred as a matter of law.”

On November 29,2011, CCI appealed from the October 31, 2011 order to the Superior Court.

On January 15, 2013, the Superior Court reversed the order granting summary judgment in favor of Sassa, and remanded the case. The Superior Court held that “the factual information necessary to evidence the triggering of the applicable statute of limitations against Sassa is not contained in the present record.” The court further noted in a footnote:

We in no way wish to suggest that this case may not yet be eligible for summary judgment relief. We hold only that the present record does not establish the commencement date for the applicable statute. Said date may be established by additional discovery, including production of evidence of the date of the denial of coverage decision by the insurance company. Should that date fall more than two years prior to the joinder of SASSA in this litigation, we would agree with the trial judge that summary judgment is appropriate.

On remand, additional discovery was taken.

On April 11, 2013, Sassa filed the current motion for summary judgment. Plaintiff filed its response in opposition thereto on May 13, 2013. On May 23, 2013, Sassa filed a reply brief. On June 6, 2013, CCI filed a surreply brief.

The case was transferred from the court’s arbitration program back to the commerce court on June 19, 2013.

FACTUAL HISTORY

CCI is a video production company that provides TV production services, such as studio production, on-site mobile production using trucks, and video editing utilizing audio/visual equipment. The programming includes the Phillies Pre-Game Show.

Employers issued policy number 753-01-73-30-0001 to CCI, effective July 1, 2007 to July 1, 2008, for damage from direct physical loss to real and business property of CCI, subject to the terms and conditions as set forth in the declaration pages of the policy. Schedule 8 from the Auto Declarations of the insurance policy shows $300,000 of coverage for auto no. 2, a 1993 Isuzu Truck that originally contained video equipment. A change was effective on July 17,2007 deleting the $300,000 coverage of the Isuzu Truck and adding $300,000 coverage for the 2006 Dodge Van (as set forth in Policy Change 5). In its complaint, CCI states: “The reason for the shifting of coverage is that the video equipment had been removed from the Truck, and temporarily stored in Building II until it could be installed in the Van.”

On August 23, 2007, a fire occurred at CCI’s Building II, destroying the building and business personal property located therein including the video equipment that formerly had been in the truck. Employers paid CCI for destruction of the building and partially paid for the business personal property. Employers also paid the business loss income directly resulting from the destruction of Building II and partially paid for the destruction of the video equipment, but paid nothing for the business income loss resulting from the destruction of the video equipment.

On February 17, 2010, CCI initiated suit against Employers for the unpaid portion of the video equipment loss and also for the business income loss resulting from the destruction of the video equipment. Kenneth Selinger (“Selinger”), president of CCI, testified at his original deposition that he asked John Geraldi (“Geraldi”), president of Sassa, to procure business income loss coverage on CCI’s video equipment. Selinger further testified that he communicated to Geraldi the purpose of the $300,000 in Schedule 8 of the auto policy was to insure any loss arising out of damage to the video equipment in the truck including loss of income.

At the time of the fire, the video equipment was not in the truck, but stored in CCI’s Building II. As a result, Employers calculated CCI’s losses under Building II’s property and business income coverages rather than the auto policy that contained the $300,000 limit of insurance. Building II and another provision of the policy did not have enough coverage to fully pay the video equipment damage, nor any of CCPs business income loss due to the loss of use of the video equipment. The remainder of the policy did not have any business income coverage that would be applicable. As a result, CCI was not paid for the business income loss to the video equipment by Employers and only partially paid for the damage to the video equipment.

Initially CCPs suit was to reform Employers’ policy to provide that the video equipment and the resultant business loss income was covered under the $300,000 in the auto policy in Schedule 8. CCPs third amended complaint alleged:

16. CCI communicated to CCPs broker, John R. Geraldi of the Richard F. Sassa Insurance Agency, Inc. (hereinafter called “SASSA”), the purpose of the $300,000 in Schedule 8 [See EXHIBIT “P-5”] was to insure any loss arising out of damage to the equipment in the truck including loss of income.
17. Upon belief, SASSA communicated the purpose of the $300,000 coverage on the truck to [EMPLOYERS via a separate nonparty entity].

On August 12, 2010, Employers responded to the foregoing averments by stating it had no knowledge of the averments in paragraphs 16 and 17. On August 27, 2010, Employers filed a joinder complaint against Sassa, alleging that Sassa was solely liable to CCI. On October 10, 2010, Sassa denied the foregoing averments in paragraphs 16 and 17 in its answer to Employers’joinder complaint.

CCI settled its reformation claim against Employers for partial payment on the video equipment loss arising from the damage to the video equipment. Apparently CCI concluded that Employers’ denial and Sassa’s subsequent similar denial to paragraphs 16 and 17, and discovery which apparently confirmed the denials that the coverage was not requested, had significantly impaired its cause of action against Employers.

When CCI settled its claims against Employers, it left outstanding only the sole liability claim in Employers’ joinder complaint against Sassa. Sassa filed a motion for summary judgment against CCI on the grounds that the two year statute of limitations had run on CCI’s claim under the sole liability claim, and CCI’s claim against Sassa was thus barred. The trial court entered an order granting Sassa’s motion for summary judgment on the statute of limitations defense. CCI filed an appeal from that order. In reversing, the Superior Court explained:

...we are compelled to agree with CCI that, granting it the benefit of all doubt as the nonmoving party, it may, at the time of the fire, have had a good faith basis upon which to believe that it had purchased the appropriate insurance. Thus, the mere occurrence of an event for which insurance coverage is sought, was not evidence that claimant was aware that the sought after coverage was not in place. While we are certainly mindful that the claimant’s good faith basis would obviously be undercut by notice of the denial of coverage from the insurer, we do not find that critical information — specifically, the date of such notice of denial — apparent on this record. Thus, we are compelled to agree with CCI that the factual information necessary to evidence the triggering of the applicable statute of limitations against SASSA is not contained the present record. Therefore, we must reverse the grant of summary judgment and remand this case for farther proceedings.

Upon remand, Sassa conducted additional discovery to further develop the factual basis for determination of when CCI knew or should have known that it did not have the business interruption coverage it allegedly sought and/or requested. Sassa now assets that CCI knew, within days of the fire at the latest, exactly what insurance coverage it had, and that it only had limited business interruption coverage; i.e., for lost rental income from the building, which was undisputedly paid by Employers.

The issue at hand is what CCI knew, or should have known, of its cause of action in negligence against Sassa before August 27, 2008-two years before the joinder complaint was filed-through exercising reasonable diligence.

DISCUSSION

In its third amended complaint, CCI claimed that Employers failed to fully compensate CCI for fire loss that caused damage to CCI’s video equipment, and also failed to compensate it for the “business interruption” losses resulting from the loss and damage to the video equipment. The issue here is whether the discovery rule may have tolled the statute of limitations for any negligence claim CCI may have against additional defendant Sassa for failing to place the type of coverage that CCI claims it wanted.

The Superior Court noted that the commencement date for the statute of limitations on a claim against Sassa was a factual issue that remained to be developed. Accordingly, CCI’s president, Selinger, was re-deposed on March 4, 2013, specifically as to the factual issues that might affect the commencement date for the running of the statute of limitations.

The statute of limitations for negligence in actions in Pennsylvania is two years. 42 P.S. §5524. The fire occurred on August 23,2007. Sassa was joined on August 27,2010. Accordingly, the statute of limitations for a claim against Sassa would have to have been tolled until August 27, 2008.

CCI claims that, under the “discovery rule,” the statute should not begin running until October 15, 2010, when Sassa filed its answer with new matter and cross-claims to Employer’s joinder complaint. In its answer, Sassa denied the averments made that CCI communicated to Geraldi (of Sassa) that the purpose of the $300,000 in schedule 8 of the policy was to insure any loss arising out of damage to the equipment truck including loss of income.

At summary judgment, a defendant must prove that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. However, here, CCI is invoking the discovery rule, which involves the burden being on the plaintiff. The “discovery rule” is an exception to the requirement that a plaintiff must file within the statutory period.

The discovery rule provides that where the existence of the injury is not known to the complaining party, and such knowledge cannot reasonably be ascertained within the prescribed statutory period, the limitations period does not begin to run until the discovery of the injury is reasonably possible. The rule is an equitable one, which excludes the period of time during which the injured party is reasonably unaware that an injury has been sustained so that people in that class have essentially the same rights as those who suffer an immediately ascertainable injury. Thus, if the injury and cause thereof are reasonably ascertainable within the (two-year) statutory period, the discovery rule does not apply and no tolling occurs.

Plaintiffs seeking to invoke the discovery rule bear the burden to establish the inability to learn of the injury despite exercising reasonable diligence. The Third Circuit explained:

The standard of reasonable diligence is an objective one [], although it is flexible enough to consider a person’s capacity to meet certain situations. “If a party has the means of discovery within his power but neglects to use them, his claim will still be barred.” In short, we must inquire whether [Plaintiff] “exhibited those qualities of attention, knowledge, intelligence and judgment which society requires of its members for the protection of their own interests.”

The precise “injury” at issue here is CCI’s claim that Sassa: negligently failed to secure property damage coverage on the video if it should happen to be outside of the van when it was destroyed; and negligently failed to secure loss of income coverage for loss of use of the video equipment, again no matter where it was when the equipment was destroyed. As will be discussed, infra, it is my ruling, as a matter of law, that CCI cannot meet its burden to demonstrate it could not, upon reasonable investigation, ascertain that these two coverages were not present in the policy.

Here, Selinger, CCI’s president, re-testified on March 4, 2013, that he reviewed the policy, at the latest, within days of the fire with both John Geraldi (Sassa’s principal) and Michael Hagan (Employer’s adjustor).

Q:... Now, at your — I think you said there was another meeting with John and then Mike as well probably still within a week or so of the fire. Correct?
A: Correct.
Q: And at that point, you had the policy ... Is that correct?
A: Correct, I mean, most of the discussions, John was really helping Mike Hagan, you know, understand some of the coverages and they were both searching, okay, is this covered and they would go through and they would look at it and so forth and so on.
Q: So that was at one of your initial meetings with you, John and Mike, that they were looking in the policy to see what coverages were there and where things might fall. Correct?
A: Correct.
Q: Did any other meetings take place over the course of the adjusting, including John, Mike and yourself, possibly your son, were reconvening to vet out coverages under the policy?
A: I don’t know how many times it happened, but it was at least six to eight meetings where we were all together....

As noted above, Selinger testified that after the fire, six to eight meetings took place to discuss coverages available under the Policy and adjustment of the loss:

Q: You testified earlier that at probably your initial meeting with John and Mike Hagan within the week of the fire, you had the policy in front of you and at various points Mike and John were going through the policy trying to determine what coverages were. Correct?
A: Correct.
Q: Is that something that happened on an ongoing basis where they would be looking back to the policy to see what coverages you had and where things could fall?
A: Correct....

Additionally, as Sassa had been CCI’s insurance agent since 2000, Selinger testified that John Geraldi did a yearly summary of coverages each year, including 2007, the year of the fire. Further, from'2000 through 2007, CCI reviewed its insurance coverages with Geraldi at least once and usually twice a year, summarizing what the coverages were:

Q: At your last deposition you were asked whether John at these yearly meetings would actually have something in writing called summary of insurance coverages. I think you just testified to that. But would he also, in addition to speaking to you, have something in writing that showed you what those coverages were at those meetings?
A: What the previous year coverages were? Yes.
Q: I think you testified earlier that after the policy went into effect, whatever you agreed upon at that meeting or thereafter, he would come back with a similar document or mail it to you, whichever the case may be, which outlined what your coverages were. Correct?
A: Correct.
Q: And that was the case pretty much from the year 2000 up until you no longer used him in your insurance needs post fire. Correct?
A: Correct.

It is undisputed that the policy, issued in July 2007, did not contain business income coverage (other than coverage for lost rental income of the building), nor had any of the previous policies purchased from Sassa. CCI did not, despite three amended complaints, ever allege a claim against Sassa. Instead, CCI indicated that CCI’s position was that the loss should have been covered under the auto policy.

The evidence clearly shows that CCI reviewed, with professional assistance, the entire Policy to determine what coverages existed both within a week of the fire, as well as six to eight times within three months of the fire to determine coverage:

Q: If John had participated in, I think your testimony was, six to eight meetings or so, do you know how many of those roughly were in 2007? That would be the last three years of the calendar year where the fire occurred.
A: Three months.
Q: Three months, sorry.
A: He definitely was involved in six to eight meetings in that calendar year.
Q: You testified earlier that at probably your initial meeting with John and Mike Hagan within the week of the fire, you had the policy in front of you and at various points Mike and John were going through the policy trying to determine what the coverages were. Correct?
A: Correct.

In Cooper, the Third Circuit affirmed that the statute of limitations expired on a breach of contract, professional negligence, and negligent misrepresentation claims, where the plaintiff had failed to explain why she, as a reasonably diligent professional, failed to use reasonable diligence in not reading the terms of her policy. Here, in fact, CCI’s president reviewed the policy within a week of the fire with representatives of both Employers and Sassa, and again six to eight times thereafter in the next three months. The policy has no coverage for business lost income.

Despite Selinger’s “assumption” that there was business interruption insurance included in the policy, or that he “expected” there to be so, this mistake or misunderstanding may not indefinitely toll the statute of limitations. CCI has not explained what, despite reasonable diligence and assistance of the multiple professionals it consulted, should have tolled the statute of limitations, where the policy was clearly reviewed within days of the fire to determine what was covered.

The only possible fact disclosed at the Selinger’s deposition to support the assertion he truly did not, and could not have known there was a problem, was that Mike Hagan said to Selinger, “you’re going to get full coverage because you have a total loss.” Such a statement was indeed literally true, as to the building, because the building was a total loss, and the policy limits on the building were paid out. The “reasonably diligent” businessman should not reasonably assume that the limits on the auto portion of the policy were also going to be tendered when the van itself is not, at all, involved in any loss. Selinger testified:

Q: After the fire, you testified that Mr. Geraldi participated in six to eight meetings with you, some of which — at some of which you went over the policy and discussed what you were eligible for and what you had to do. Correct?
A: Correct.
Q: And at any point during those meetings, and I’ll ask the same question for those meetings, did he represent to you specifically that a business income claim should be covered under the auto portion of the policy?
A: I don’t know if he specifically mentioned under the auto part of the policy, but he certainly indicated that we would be covered for some of the interruption that we were experiencing.

Selinger was not affirmatively mislead, nor does CCI assert as such.

In Judge Bernstein’s opinion to the Superior Court on April 11, 2013, it was stated that plaintiff’s first-party insurance claim became knowable on August 23, 2007, the date of the fire. The Superior Court noted that “[CCI] may, at the time of the fire, have a good faith basis upon which to believe that it purchased the appropriate insurance. Thus, the mere occurrence of an event for which insurance coverage is sought, was not evidence that claimant was aware that the sought after coverage was not in place.” It clear now, through additional discovery, that CCI was not affirmatively mislead, and there could be no good faith basis for CCI to believe it purchased the insurance it “assumed” it had.

CCI’s first-party insurance claim became knowable by the end of calendar year 2007, and certainly within a year of the fire and before August 27, 2008. CCI’s president acknowledges that the policy was reviewed in detail with him six to eight times at least three months after the fire, and does not testify that he was assured his damaged would be covered under the auto portion of the policy.

What is remarkable about this case is that CCI transferred the $300,000 limits of coverage on the Isuzu Truck to be the limits on the Dodge Van when the equipment was to be removed from the Isuzu and to be installed into the Dodge. This was done on July 17, 2007, within six weeks of the fire. One purpose was to provide added coverage for the expensive video equipment, which would now be located in the Dodge (a purpose known to both parties). And, according to CCI, another purpose was to provide added coverage to include loss of income due to any loss of use of the video equipment. The loss occurred not because there was any loss to the Dodge, but because the equipment was sitting in a building before it could be installed in the Dodge. This scenario cries out for a duty on the insured to investigate appropriate coverage. Not only was the equipment outside the automobile at the time of the loss, but facially in the policy itself, there was not coverage for business income coverage loss of income — other coverage for lost rental income to the building.

There was extensive discussion about the issues of coverage, and nowhere is it averred or established that Sassa lied to or mislead CCI to an extent where the statute of limitations could have been tolled beyond the end of 2007. As such, the negligence claim was instituted outside of the statute of limitations.

CONCLUSION

In conclusion, as the discovery rule did not toll the statute of limitations beyond 2007, the statute of limitations ran before the joining of Sass, and summary judgment is entered in favor of additional defendant The Richard F. Sassa Insurance Agency, Inc.

      . The court agrees with plaintiff that there may remain a question whether Sassa was negligent in obtaining the insurance that plaintiff allegedly wanted secured. However, the precise question presented at summary judgment is whether plaintiff knew or should have known that there existed a cause of action concerning adequate coverage on or before August 27,2008 (two years before the joinder complaint was filed). Plaintiff did not show that the discovery rule should have tolled the statute of limitations until August 27, 2008. To the contrary, a reasonable investigation would reveal that actionable coverage issues existed by the end of 2007.

      . The original complaint was filed On February 17, 2010; the first amended complaint was filed March 1, 2010; the second amended complaint was filed April 7,2010.

      . Control No. 11101452.

      . J. Bernstein op., Oct. 31, 2011, p.2. It should be noted that plaintiff, itself, never asserted a cause of action in negligence against Sassa.

      . CCI Communications, Inc. v. Richard F. Sassa Insurance Agency, Inc., No. 3253 EDA 2011 (Nov. 20, 2012), mem. per curiam, p.6-7 (“Superior Ct. op.”)

      . Id. at 8 n.6.

      . Third am. compl. ¶5.

      . CCI Resp. to Sassa mot. summ. j., p. 2 (citing Superior Ct. op.).

      . CCI Resp. to Sassa mot. summ. j., p. 2-3.

      . There is no evidence that the van suffered any loss during the building fire.

      . CCI Resp. to Sassa mot. summ. j., p.3.

      . Id. (citing CCI third am. compl. ¶16-17).

      . Employers’joinder compl. ¶27.

      . CCI Resp. to sassa mot. summ. j., p.4.

      . Superior Ct. op. p.3.

      . Superior Ct. op., p. 7-8.

      . Sassa mot. summ. j. ¶16.

      . Sassa mot. summ. j. ¶17. It should be noted that the Superior Court implied that “the date of the denial of coverage decision by the Insurance company” would be important; however, there was not denial of coverage here. Instead, CCI argued that the loss had been adjusted improperly under the property portion of the policy, rather than under the auto portion of the policy whose proceeds had not been exhausted. CCI third am. compl. ¶9. Neither party has addressed the Superior Court’s concerns over a “denial date.” Because payment was made, but there was an alleged problem with the type of coverage, neither party appears to assert a “date of denial.” as being critical.

      . Sassa mot. summ. j. ¶18.

      . Sassa ans. to joinder comp. ¶16-17.

      . Rausch v. Mike-Meyer, 783 A.2d 815, 821 (Pa. Super. 2001).

      . It must be noted that the discovery rule issue was not previously asserted before the trial court, and was waived before the Superior Court. Superior Ct. op. p. 5-6.

      . Dalrymple v. Brown, 549 Pa. 217, 223, 701 A.2d 164, 167 (1997)

      . Id. (citation omitted).

      . Id.

      . Baumgart v. Keene Bldg. Prods. Corp., 468 A.2d 468, 471 (Pa. 1983).

      . Cooper v. Sirota, 37 F. App’x 46, 49 (3d Cir. 2002) (citations omitted).

      . Selinger dep. 23:16-24:23; Mar. 4, 2013 (emphasis added).

      . Selinger dep. 24:14-23; 30:15-33:2; 53:13-20; 61:3-62:14.

      . Selingerdep. 31:16-33:15.

      . Sassa mot. summ. j. ¶25-26.

      . Selinger dep. 62:15-21.

      . Selinger dep. 29:22-30:22.

      . Cooper, 37 Fed. App’x at 49.

      . Selinger dep. 53:6-19.

      . Selinger dep. 61:21-62:7.

      . See Pocono Int’l Raceway v. Pocono Produce Inc., 468 A.3d 468, 471 (Pa. 1983).

      . Selinger dep. 25:24-25.

      . Selinger dep. 61:3-20.

      . J. Bernstein op. Apr. 11, 2013, p.2.

      . Superior Ct. op. p.7.


author: ZULICK, J,

text:
    Dansbury Choo Choo Express v. RBLA of PA

      C.P. of Monroe County,
    No. 12391 CV 2010

      Alan C. Milstain and Kristopher B. Chiesa, for plaintiffs.

      John C. McNamara, for defendant.
    August 29, 2013
   ZULICK, J,

Defendant RBLA OF PA, Inc. (RBLA) has filed a motion for summary judgment. This action arises out of a dispute over the insurance proceeds disbursed after a fire destroyed the Dansbury Depot restaurant property in East Stroudsburg. Peter Andrews bought the property in January, 2009. Dansbury Choo Choo Express, inc. (Dansbury), a business corporation of which Mr. Andrews was the sole shareholder, bought the restaurant liquor license and the contents of the restaurant. Mr. Andrews then leased the restaurant to Dansbury.

Andrews engaged Tom Geffers, an insurance broker with RBLA to provide insurance brokerage services to Andrews. Andrews’ discussions about insurance began with Geffers in December, 2008. Using Geffers’ brokerage, Andrews purchased insurance for the Dansbury Depot property from QBE. Andrews alleges that he asked Geffers to insure the full value of the property.

A fire substantially destroyed the Dansbury Depot in October 2009. QBE, Andrews’ insurer, invoked a coinsurance penalty, as the Depot did not meet the required 80 percent co-insurance rate stated in the policy. As a result, Andrews’ policy with QBE covered less than his alleged damages.

Andrews brought suit against RBLA, alleging: (1) that RBLA breached an oral contract between Andrews and Geffers for Geffers to procure “full insurance” for the Depot (contract claim) and (2) that RBLA had a duty to procure adequate insurance for the Depot, and breached that duty by failing to act with the standard of care required of an insurance broker (tort claim).

After pretrial discovery, RBLA moved for summary judgment. RBLA has advanced several theories as to why the case should be dismissed. They are: (1) plaintiffs suffered no damages; (2) the “gist of the action” doctrine bars the tort claim; (3) the tort claim is barred by Pennsylvania’s two year statute of limitations; (4) the tort claim is barred by the “assumption of the risk” doctrine; (5) the complaint lacks factual foundation, as plaintiffs’ blamed QBE alone for their loss during depositions; (6) the complaint lacks legal foundation as Pennsylvania does not recognize a duty for an insurance broker to procure the appropriate amount of insurance; (7) the contract claim should fail for lack of consideration between Andrews and RBLA; and (8) the general release signed by Andrews upon disbursement of funds by QBE released or discharged the claims against RBLA.

Plaintiffs filed a written response opposing RBLA’s motion for summary judgment. Both parties filed briefs, and the motion was argued on July 1, 2013.

DISCUSSION

“Summary judgment is only appropriate in cases where there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law.” Gleason v. Borough of Moosic, 609 Pa. 353, 361 (2011). A material fact is one that directly affects the outcome of the case. Bartlett v. Bradford Publ’g, Inc., 885 A.2d 562, 568 (Pa. Super. 2008). A court must view the evidence in the light most favorable to the nonmoving party, and all doubts as to a genuine issue of material fact must be resolved against the moving party. Gleason, 609 Pa. at 361 (citing Fine v. Checcio, 582 Pa. 253 (2005)). When the moving party satisfies its initial burden, the nonmoving party may not simply rest upon the allegations or denials contained in the pleadings, instead the nonmoving party must show there is a genuine issue for trial. Preferred Fire Prot., Inc. v. Joseph Davis, Inc., 984 A.2d 20, 24 (Pa. Super. 2008). A nonmoving party’s failure to adduce sufficient evidences on an issue essential to the case establishes that no genuine issue of material fact exists, and the moving party is entitled to judgment as a matter of law. Ario v. Ingram Micro, Inc, 965 A.2d 1194, 1207 n.15 (Pa. 2009).

Plaintiffs’ Contract Claim.

“A claim for breach of contract exists where it can be shown that there was a contract, a breach of a duty imposed by that contract and damages that resulted from the breach.” Koken v. Steinberg, 825 A.2d 723, 729 (Pa. Cmwlth. 2003) (citing General State Authority v. Coleman Cable & Wire Co., 365 A.2d 1347 (Pa. Cmwlth. 1976)). “The basic elements of a contract consist of an offer, acceptance, and consideration.” Koken, 825 A.2d at 729 (citing Hatbob v. Brown, 575 A.2d 607, 613 (Pa. Super. 1990)).

Here, plaintiffs’ contract claim must fail for want of consideration. It is not disputed that the only compensation paid to RBLA was in the form of a commission payment from QBE. It is true that “[cjourts generally will not inquire into the value of consideration where it is clear that adequate consideration exists.” Delaware Valley Factors Inc. v. Ronca, 660 A.2d 623, 625 (Pa. Super. 1995). However, some consideration must exist for a valid contract to be formed. SKF USA, Inc. v. W.C.A.B. (Smalls), 714 A.2d 496, 499 (Pa. Cmwlth. 1998). “Consideration exists where there is a bargained-for exchange by the parties to the contract.” Id. Plaintiff has not cited, nor has this court found, any precedent for the proposition that a commission payment from a third party can be deemed consideration such that a valid contract has been formed. As there was no consideration tendered by Andrews to RBLA, no contract was formed. The contract claim will be stricken from the complaint.

Plaintiffs’ Tort Claim.

Andrews and Dansbury have filed responses to RBLA’s motion for summary judgment. They have presented evidence from Peter Andrews, the deposition of Tom Geffers, and from an insurance professional that Mr. Geffers’ conduct fell below the applicable standard of care.

Plaintiffs contend that RBLA is liable to them on a negligence theory. Their claim rests upon two pillars: (1) that RBLA should have obtained higher coverage than the 1.2 million dollar policy that was offered and ultimately purchased; and (2) that RBLA should have explained the risk inherent in the coinsurance provision of the policy. establish the presence of a legal duty or obligation; a breach of that duty; a causal link between that breach and the injury alleged; and actual damage or loss suffered by the claimant as a consequence of thereof.” Wright v. Eastman, 63 A.3d 281, 284 (Pa. Super. 2013).

“To state a claim for negligence, a claimant must

“The initial element in any negligence cause of action is the first: that the defendant owes a duty of care to the plaintiff. The existence of a duty is a question of law for the court to decide. In negligence cases, a duty consists of one party’s obligation to conform to a particular standard of care for the protection of another. This concept is rooted in public policy.” R. W. v. Manzek, 888 A.2d 740, 746 (Pa. 2005) (citations omitted).

In Althaus v. Cohen, 756 A.2d 1166 (Pa. 2000), our supreme court set forth a five-factor test for determining whether a duty exists: (1) the relationship between the parties; (2) the social utility of the actor’s conduct; (3) the nature of the risk imposed and foreseeability of the harm incurred; (4) the consequences of imposing a duty upon the actor; and (5) the overall public interest in the proposed solution. Id. at 1168-69. Applying these factors to the evidence viewed in a light most favorable to the plaintiffs, results in the following.

1. The relationship between the parties.

There is no dispute here that RBLA acted as an insurance broker, not an insurance agent.

An ‘insurance broker’ is one who acts as a middleman between the insured and the insurer, soliciting insurance from the public under no employment from any special company, and upon securing an order, placing it with a company selected by the insured or with a company selected by himself or herself; whereas an ‘insurance agent’ is one who represents an insurer under an employment by it. A broker is, in essence, employed in each instance as a special agent for a single purpose, while the very definition of an agent indicates an ongoing and continuous relationship. Since many insureds deal with the same broker for long periods of time, it is, in most cases, the continuity of the agency relationship that differs from the broker relationship; brokers and insureds are ordinarily involved in what can be viewed as a series of discrete transactions, while agents and insurers tend to be under some duty to each other during the entire length of the relationship.
Couch on Insurance, § 45:1 (3d ed.2005); see also 31 Pa.Code § 37.1 (drawing substantially the same distinction between “agent” and “broker”)

Wisniski v. Brown & Brown Ins. Co. of PA, 906 A.2d 571, 578 (Pa. Super. 2006).

For ordinary negligence purposes, the relationship between an insurance broker and client is an arm’s-length business relationship. Plaintiffs have asserted no claim for breach of fiduciary duty, so the question of whether there was a confidential relationship between Mr. Geffers and Mr. Andrews need not be addressed here. Id. at 579.

2. The social utility of the actor’s conduct

The plaintiffs claim that Mr. Andrews asked Mr. Geffers to get him insurance coverage for the Dansbury Depot. Viewing the evidence in a light most favorable to the plaintiffs, when Geffers came back to him with a proposal for insurance in the amount of $ 1.2 million in property coverage, and $175,000 for contents, Mr. Andrews said “...that’s not enough.” “Deposition of Peter Andrews, exhibit B to plaintiffs’ response to defendant’s motion for summary judgment, page 47. Mr. Geffers responded “that’s all they would give.” Id. The proposal included a coinsurance clause of 80%. Mr. Geffers did not explain the effect of this clause in the policy to Mr. Andrews before Andrews purchased the policy. Deposition of Thomas Geffers, exhibit A to plaintiff’s response to defendant’s motion for summary judgment, pages 27-29.

Plaintiffs admit in their brief that an insurance broker “is not expected to be a property appraiser regarding ascertaining the correct limit of insurance to fully insure any property for adequate limits...” Plaintiff’s brief, page 15. There is little social utility in requiring an insurance broker who may not be trained or licensed in property appraisal to be responsible for advising property owners of the appropriate amounts of insurance coverage for their properties. In fact, the owner of the property often will be in a better position to make this determination.

The imposition of liability would remove the responsibility of Mr. Andrews to “take care of his own financial needs and expectations” before entering the marketplace to procure insurance coverage. See Farmers Ins. Co., Inc. v. McCarthy, 871 S.W.2d 82, 85 (Mo. App E.D. 1994). Imposing a burden on RBLA would make it responsible for determining the insured’s financial needs and expectations before insuring them.

3. The nature of the risk imposed and foreseeability of the harm incurred.

If a duty to determine the appropriate limits of an insurance policy were imposed on RBLA it would transform the insurance broker into Andrews’ insurance consultant, something that Andrews did not contract RBLA for or pay a fee for. To have assumed a duty of determining appropriate limits, RBLA would be required to extensively analyze the market values of the components of Andrews’ business and predict replacement values. Unless RBLA was hired and paid for this purpose, it does not make sense to shift the responsibility of determining appropriate insurance limits to the broker. Mr. Andrews was the party who knew the fair market value of the property he purchased and he knew or should have determined what its replacement value might be in the event of a fire.

4. The consequences of imposing a duty upon the actor.

Andrews has cited no Pennsylvania authority for imposing a duty upon an insurance broker to determine the correct property insurance limits. If this duty were imposed in this case, property owners would be free to insure low, pay low premiums, and sue the insurance broker in the event of a loss for failing to advise or inform customers about the need for additional coverage. The duty of an insurance broker would be greatly expanded.

5. The overall public interest in the proposed solution

The Wisniewski court found that there was no strong public interest in requiring insurance brokers to inspect business premises and advise clients based on that inspection. Id. at 581.

Th eAlthaus factors do not weigh in favor of recognizing a broker’s duty to recommend appropriate property damage limits. Imposing this duty would unduly burden an insurance brokers and “hinder the free marketplace of insurance. Defendant’s motion for summary judgment will be granted upon this issue.

A different result is reached on the issuance of the coinsurance provision of the policy. Mr. Andrews wanted “full insurance.” He was told by Mr. Geffers that he could only get $1.2 million in insurance coverage. He responded that that was not enough insurance, but accepted Geffers response that that was all he could get. Geffers did not warn him that there was a coinsurance provision in the policy that would further diminish his recovery in the event of property damage.

This policy contained the following co-insurance provision:

F. The following conditions apply in addition to the Common Policy Conditions and the Commercial Property Conditions:

2. Coinsurance

If a Coinsurance percentage is shown in the Declaration, the following condition applies:
...b. We will not pay the full amount of any loss if the value of Covered Property at the time of the loss times the Coinsurance percentage shown for it in the Declarations is greater than the Limit of Insurance for the property.
Instead, we will determine the most we will pay using the following steps:
(5) Multiply the value of Covered Property at the time of loss by the Coinsurance percentage;
(6) Divide the Limit of Insurance of the property by the figure determined in Step (1);
(7) Multiply the total amount of loss, before the application of any deductible, by the figure determined in Step (2); and
(8) Subtract the deductible from the figure determined in Step (3).
We will pay the amount determined in Step (4) or the limit of insurance, whichever is less. For the remainder, you will either have to rely on other insurance or absorb the loss yourself.
Plaintiff’s Opposition at Exhibit E.

Coinsurance is a way to divide the risk of loss between the insurance company and the insured, depending upon the policy limits and the actual value of the property insured. 44 C.J.S. Insurance § 6 (1993). The policy language quoted above provides that if Andrews failed to purchase limits of insurance at a minimum percentage of the value of the covered property-here eighty percent-the full amount of any partial loss is not paid.

The Nebraska Court of Appeals described the concept as follows:

Coinsurance makes common sense if explained. For example, if one has contents with a replacement value of $100,000, but purchases a limit of coverage of only $40,000, the person naturally has not insured all of the contents for full value. Rather, depending on how one looks at it, he or she has either insured 40 percent of all the property for full value or 100 percent of the property for 40 percent of its value. If 100 percent of the contents are lost, the insured’s recovery is $40,000; but in the event of a partial loss of the covered property, an insured does not receive the full replacement cost of each item of property lost up to the coverage limit of $40,000. Rather, in that event and since the insured has, in essence, only insured a percentage of the whole, he or she recovers only a percentage of the full value of the property lost, an amount determined by the policy’s coinsurance formula.
Coinsurance is designed to prevent an insured, who recognizes the likelihood that losses are more likely to be partial than total, from paying a lower premium by insuring his property for less than its full value and then recovering the full value of his loss. Robert Works, The Law of the Insurance Contract § 5.4.3 (1992). Coinsurance is an effort to encourage the purchase of greater amounts of insurance by making full recovery of partial losses conditional upon maintaining a ratio (here 80 percent) between the coverage purchased and the actual value of the property. Id.
Coinsurance clauses are reasonable, consistent with the rule of indemnity, and preserve the solvency of insurance companies and the equitable application of insurance rates. See, generally, Annot., 43 A.L.R.3d Insurance-Coinsurance Requirement § 566 (1972). See, also, Stake v. Western Assurance Co., 136 Neb. 735, 740, 287 N.W. 222, 224 (1939) (where insured failed to cany coverage of at least 80 percent of value of property covered, she was required under policy “to the extent of such deficit [to] bear her proportion of any loss”), disapproved in part on other grounds, Muff v. Mahloch Farms Co., Inc., 186 Neb. 151, 181 N.W.2d 258 (1970).
Custom Auto Body Co. v. Prososki, WL 14492, 5-6 (Neb. App. 1999) (non-precedential decision).

Provisions of the policy itself that may have a crucial effect on the payment of claims, such as the co-insurance provision in this case, should be explained by the broker, who is the one with expertise in this area. The owner does rely upon the expertise of the broker to point out policy provisions that may cause a substantial reduction in payment to the owner in the event of a claim. The duty of good faith and fair dealing “includes the duty of full and complete disclosure as to all of the benefits and every coverage that is provided by the applicable policy or policies.” Dercoli v. Pennsylvania National Mutual Insurance Co., 554 A.2d 906, 909 (Pa. 1989).

Our appellate courts have observed on multiple occasions that “’normal’ contract principles do not apply to insurance transactions.” Drelles v. Mfr’s. Life Ins. Co., 881 A.2d 822, 836 (Pa. Super. 2005). See also Pressley v. Travelers Prop. Cas. Corp., 817 A.2d 1131, 1139 (Pa. Super. 2003) (quoting Collister v. Nationwide Life Ins. Co., 388 A.2d 1346, 1351 (Pa. 1978)) (“Contrary to Travelers’ contention, ‘normal contract principals [a]re no longer applicable in insurance transactions.’”). Rather, “[t]he proper focus regarding issues of coverage under insurance contracts is the reasonable expectation of the insured.” Bubis v. Prudential Prop. & Cas. Ins. Co., 718 A.2d 1270, 1272 (Pa. Super. 1998) (quoting Frain v. Keystone Ins. Co., 433 Pa. Super. 462, 640 A.2d 1352 (1994)). Moreover, a court’s focus upon the insured’s “reasonable expectations” is not limited only to situations in which the insurance contract might be deemed ambiguous. Pressley, 817 A.2d at 1140.

Decisions have affirmed that “regardless of the ambiguity, or lack thereof, inherent in a given set of insurance documents” insurance transactions... are subject to a review of the totality of the underlying circumstances, Pressley, 817 A.2d at 1139 (quoting Tonkovic v. State Farm Mut. Auto. Ins. Co., 521 A.2d 920, 926 (1987)). Although the parties ’ reasonable expectations remain “best evidenced by the language of the insurance policy[,]” Allstate Ins. Co. v. McGovern, 2008 WL 2120722, at 2 (E.D. Pa. May 20, 2008), a court’s decision to look beyond the policy language is not erroneous under all circumstances, see Pressley, 817 A.2d at 1139. Betz v. Erie Ins. Exchange, 957 A.2d 1244, 1252-53 (Pa. Super. 2008). Bishops, Inc. v. Penn Nat. Ins., 984 A.2d 982, 989-90 (Pa. Super. 2009) (footnotes omitted). Safe Auto Ins. Co. v. Berlin 991 A.2d 327, 331-332 (Pa. Super. 2010).

RBLA had a legal duty to deal with Andrews in a fair manner, with full disclosure of the terms of the policy. Mr. Geffers knew Andrews wanted “full insurance,” and that Andrews thought his coverage was “too low.” His response was that QBE would not provide more coverage. After the fire, Andrews was confronted with the unfortunate situation of QBE having been unwilling to provide greater coverage before the fire and then saying that he was underinsured after the fire occurred less than one year later. This quandary might have been avoided if Geffers warned him of the reduction in insurance coverage posed by the coinsurance clause. Andrews may then have looked elsewhere for better coverage. Defendant’s motion will be denied as to this claim.

RBLA next argues that Andrews did not suffer any damages. They allege that Andrews purchased the Depot and the contents therein for $1,550,000. Between the insurance proceeds ($1,299,000) and the sale of the vacant lot and liquor license ($625,000), RBLA argues Andrews made a profit. The parties’ briefs did not clarify the components of the insurance proceeds, but the coinsurance deduction was taken from Andrews’ recovery. The purpose of compensatory damages is to make the plaintiff whole. Feingold v. Southeastern Pennsylvania Transp. Authority, 517 A.2d 1270, 1276 (Pa. 1986). “As between the innocent victim of a wrong and the person who accomplished the wrong, the law imposes on the malfeasor the obligation to make the victim whole in every phase in which the victim has suffered, to the extent that rehabilitation is possible in terms of money.” Spangler v. Helms New York-Pittsburgh Motor Expo, 153 A.2d 490, 492 (Pa. 1959). Andrews has a claim for the insurance proceeds he lost through the coinsurance deduction.

RBLAnext argues that it has been released from liability. Upon disbursing the insurance proceeds to Andrews, QBE and Andrews entered into a general release, the pertinent portion of which is as follows:

That, The Undersigned for an in consideration of the sum of One Million Two Hundred and Ninety Nine Thousand Dollars, ($1,299,000.00), the receipt and sufficiency of which is hereby acknowledged, does hereby remise, release and forever discharge QBE Insurance Corporation, its successors and assigns, and/ or his, her, their heirs, executors and administrators, and also an (sic) and all other persons, associations and corporations, whether herein names or referred to or not, and who, together with the above named, may be jointly and severally liable to the Undersigned, of and from any and all, and all manner of, actions and causes of actions and causes of action, rights, suits, covenants, contracts, agreements, judgments, claims and demands whatsoever in law or equity.

(Emphasis in original). The general release does not specifically state that RBLA was discharged by the release. Further, the intent of the parties is paramount when construing a written release. Sparler v. Fireman’s Ins. Co. of Newark, N.J., 521 A.2d 433, 435 (Pa. Super 1987). RBLA has not offered any evidence that they were intended to be a party to the release between QBE and Andrews. RBLA has cited no cases or other authority in its brief on this issue. The court will not independently research this issue looking for support for defendant’s theory. The motion for summary judgment will not be granted on this defense.

RBLA next argues that the suit should be dismissed as Andrews assumed the risk of being underinsured. Andrews stated, during his deposition, that he felt that the property was underinsured in December 2008. RBLA’s motion for summary judgment, exhibit 3. However, “as a general rule, the doctrine of assumption of the risk...has been supplanted by the Pennsylvania General Assembly’s adoption of a system of recovery based on comparative fault in the Comparative Negligence Act.” Hughes v. Seven Springs Farm, Inc., 762 A.2d 339, 341 (Pa. 2000) (internal citations omitted). In any case:

[T]he question of assumption of the risk typically remains for the juiy. Only where the evidence reveals a scenario so clear as to void all questions of material fact concerning the plaintiff’s own conduct can the court enter summary judgment; in effect the court determines that the plaintiff relieved the defendant of the duty to guard him from a risk of harm regardless of the source from which the duty derived.

Matharu v. Muir, 29 A.3d 375, 388 (Pa. Super. 2011) (internal citations and quotations omitted). Questions of material fact exist in this case, namely: (1) whether Geffers promised Andrews that the Depot would be “fully insured” and (2) whether Geffers properly disclosed and explained the co-insurance provision. As such, dismissing the case based on the doctrine of assumption of the risk would be improper.

Finally, RBLA argues that the tort claim should be dismissed because it was untimely filed. The statute of limitations is codified at 42 Pa.C.S.A. § 5524. It provides, in pertinent part:

The following actions and proceedings must be commenced within two years:

(7) Any other action or proceeding to recover damages for injury to person or property which is founded on negligent, intentional, or otherwise tortious conduct or any other action or proceeding sounding in trespass, including deceit or fraud, except an action or proceeding subject to another limitation specified in this subchapter.

Id. This matter was commenced December 27, 2010. RBLA argues that because Andrews believed he was underinsured before Christmas 2008, see supra, that he failed to file within the two year time period the statute provides. However, Andrew’s cause of action accrued on date of the fire, October 26, 2009. Before the fire, even though Andrews may have known he was underinsured, he could not have initiated a suit, as he had suffered no damages. The October 2009 fire and the amount of the insurance recovery paid thereafter were the injuries that form the basis of his complaint. The action was timely filed.

While Andrews has not alleged a proper breach of contract claim due to the lack of consideration between himself and RBLA, he has alleged a prima facie negligence cause of action on the failure to explain the effect of the policy’s coinsurance provisions. There are still genuine issues of material fact as to what was promised by Geffers, and what explanation was offered regarding the co-insurance penalty provision. The motion for summary judgment will be granted in part and denied in part.

ORDER

And now, this 29th day of August, 2013, upon consideration of defendant RBLA’s motion for summary judgment, and the arguments and briefs of both parties, It is ordered as follows:

1. RBLA’s motion for summary judgment is granted as to count 1 of the amended complaint, which is stricken.
2. RBLA’s motion for summary judgment as to count 2 (tort claim) is granted as to the claim for underinsuring the property. It is denied on plaintiffs’ claim of negligence due to failure to explain the coinsurance provision of the policy.
3. In all other respects, RBLA’s motion for summary judgment is denied.

      . As the contract claim has been stricken, the tort claim will not be stricken under the “gist of the action” doctrine. “As a practical matter, the [gist of the action] doctrine precludes plaintiffs from re-casting ordinary breach of contract claims into tort claims.” eToll, Inc. v. Elias/ Savion Advertising, Inc., 811 A.2d 10, 14 (Pa. Super. 2002). Since the breach of contract claim is no longer part of the case, the doctrine does not apply.

      . See cases cited in Manzella v. Gilbert-Magill Co., 965 S.W. 2d 221, 228 (Mo. Ct. App. W.D. 1998).


author: MASSIAH-JACKSON, J.,

text:
    Tamburro v. Mills

      Matthew B. Weisberg, for plaintiffs/appellants.

      Aaron Edward Moore, for defendant/appellee.
    September 23, 2013
   MASSIAH-JACKSON, J.,

On April 30, 2013, Ms. Colleen Tamburro filed an amended complaint on behalf of her two minor children who claim to be disappointed, would-be beneficiaries of an annuity policy. The plaintiffs commenced professional negligence and breach of contract litigation against attorney Michael Mills and his law firm. Defendants filed preliminary objections to the amended complaint with challenges to venue and in the nature of a demurrer. The parties subsequently agreed to withdraw the venue challenge and the court was asked to consider the substantive issues raised.

In Pennsylvania the class of individuals who are intended third-party beneficiaries with standing to pursue litigation is very narrow. See e.g. Chen v. Chen, 893 A.2d 87 (Pa. 2006); Hicks v. Saboe, 555 A.2d 1241 (Pa. 1989); Pa. Liquor Control Board v. Rapistan, Inc., 371 A.2d 178 (Pa. 1976); Steffy & Son, Inc. v. Citizens Bank, 7 A.3d 278 (Pa. Superior Ct. 2010); Hess v. Fox Rothschild, LLP, 925 A.2d 798 (Pa. Superior Ct. 2007); Minnich v. Yost, 817 A.2d 538 (Pa. Superior Ct. 2003); Strutz v. State Farm Mutual Insurance Co., 609 A.2d 569 (Pa. Superior Ct. 1992).

On August 6, 2013, this court filed an order which sustained the preliminary objections and dismissed the amended complaint with prejudice. Plaintiff-Tamburro filed a timely notice of appeal. In accordance with Rule 1925(a) of the Pennsylvania Rules of Appellate Procedure, this court respectfully submits to the Honorable Superior Court the order and attached memorandum, dated August 6, 2013, collectively attached herein as court exhibit “A”, as the reasons for the rulings and order.

ORDER

And now, this 6th day of August, 2013, upon consideration of preliminary objections to plaintiffs first amended complaint filed by defendants, Antheil, Maslow & MacMinn, LLP, and Michael Mills, Esquire, and plaintiffs response thereto, and for the reasons set forth in court exhibit “A”, attached hereto, it is hereby ordered that the preliminary objections are sustained and each of plaintiffs’ claims is dismissed with prejudice.

Court Exhibit “A”

Ms. Colleen Tamburro, mother of minor children Ava Tamburro and Evan Tamburro, initiated this Legal Malpractice action against attorney Michael Mills and his law firm, Antheil, Maslow, and MacMinn, LLP (collectively “defendants”). Plaintiff-Tamburro asserts in count I a professional negligence claim and in count II a breach of contract claim on behalf of herself and as parent to the children. Defendants filed preliminary objections in the nature of a demurrer per Rule 1028(a) (4) to plaintiffs’ first amended complaint. Challenges to venue were withdrawn. After careful consideration of the circumstances presented, the preliminary objections are sustained. This court concludes that no recovery is possible and the first amended complaint is dismissed with prejudice.

Ms. Tamburro’s father, John L. Moyer, who died in July, 2011, was a client of the named defendants. The plaintiffs allege that the defendants failed to file the “correct paperwork” to name Ava and Evan as beneficiaries of a Genworth annuity.

Count I — Professional Negligence

In Pennsylvania, an individual may file a legal malpractice claim in negligence (trespass) and for breach of contract (assumpsit) against the attorney who represented her. Guy v. Liederbach, 459 A.2d 744 (Pa. 1983); Coleman v. Duane Morris, LLP, 58 A.3d 833 (Pa. Superior Ct. 2013), allocator granted, June, 2013. The Supreme Court noted in Guy at 459 A.2d 746 that there must exist an attorney-client relationship or an analogous professional relationship to maintain an action in negligence for professional malpractice. See also, 459 A.2d at 750:

“Thus we retain the requirement that plaintiff must show an attorney-client relationship or a specific undertaking by the attorney furnishing professionals services...as a necessary prerequisite for maintaining such suits in trespass on a theory of negligence.”

Similarly, Fiorentino v. Rapoport, 693 A.2d 208 (Pa. Superior Ct. 1997), noted the differing elements of proof necessary when an individual sues her attorney under either a negligence theory or breach of contract. See, 693 A.2d at 212:

“In a trespass action alleging legal malpractice concerning a civil matter, the plaintiff must establish three elements in order to recover: (1) the employment of the attorney or other basis for duty; (2) the failure of the attorney to exercise ordinary skill and knowledge; and (3) that the attorney’s failure to exercise the requisite level of skill and knowledge was the proximate cause of damage to the plaintiff.”

In the case at bar, significantly absent from plaintiffs’ first amended complaint in any claim that these plaintiffs and these defendants maintained an attorney-client relationship, Rather, the Introduction states:

“Plaintiffs’ grandfather, John L. Moyer, retained Defendants toward setting up an estate plan.”

When considering a demurrer, the court determines whether, on the facts averred, the law says with certainty that no recovery is possible. This court concludes that no recovery in negligence is possible in the absence of an attorney-client relationship. Count I of plaintiffTamburro’s first amended complaint is dismissed with prejudice.

Count II —■ Breach of Contract

Paragraph 17 of the first amended complaint sets forth the plaintiff’s alternative cause of action:

“17. Plaintiffs were third-party or otherwise to be beneficiaries under a contract for legal services between Defendant and Decedent, John L. Moyer. (In the possession of Defendants).”

The defendants’ memoranda point out alleged deficiencies in the breach of contract count:

“[Plaintiff] has, in a conclusory manner, alleged that Mills, ‘fail[ed] to file paperwork to amend beneficiaries of the Genworth Annuity,’ which allegedly resulted in her children’s exclusion from the proceeds of the annuity upon her father’s death. Tamburro has not alleged that her father ever specifically requested that Mills file change of beneficiary designation forms with Genworth. In fact, Tamburro has not alleged that her father ever provided executed change of beneficiary forms to Mills for purposes of having them filed with Genworth. Indeed, Tamburro has not specifically alleged any facts which would suggest that Mills, or anyone else at Antheil Maslow, failed to carry out any request made upon him by the decedent.”

These plaintiffs correctly comment in their memorandum that “a neglected attorney-client relationship produces a breach of contract....” See, Florentino v. Rapaport, supra, 693 A.2d at 213, quoting Bailey v. Tucker, 621 A.2d 108 (Pa. 1993), “if an attorney agrees to provide his or her best efforts and fails to do so, an action in assumpsit will accrue.” It can not be disputed that attorneys are bound to perform their duties properly. If Ava and Evan Tamburro have standing as third party beneficiaries, the litigation may proceed to trial for resolution of whether or not a professional contract (oral or written) exists and/ or whether such contract was breached. Without standing, however, they can not assert a claim.

The defendant-attorneys preliminary objections seek dismissal on the basis that these plaintiffs do not have standing as third-party beneficiaries to bring this cause of action. Defendants assert “Tamburro has not alleged that defendants failed to properly draft a document which resulted in harm incurred by her or her children.... She... has not alleged that she caused to sustain individual harm as a result of any conduct or omission of Defendants. Nor has she alleged that she was a beneficiary to the contract between Defendant and Moyer.”

The Pennsylvania appellate court view of a third party beneficiary claim was noted in Scarpitti v. Weborg, 609 A.2d 147 (Pa. 1992) at 150-151:

“Accordingly, we hold that 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.” (emphasis in original) (citations omitted)

Recently, in Burks v. Federal Insurance Co., 883 A.2d 1086 (Pa. Superior Ct. 2005), the Superior Court affirmed a trial court which sustained preliminary objections on the basis that a plaintiff was not a third party beneficiary and therefore had no standing to bring suit. The appellate court relied on Scarpitti v. Weborg, supra; Guy v. Liederbach, supra; and the Restatement (Second) of Contracts §302, to conclude that where a purported contract does not expressly state that the third party is intended to be a beneficiary, the plaintiffs must show that both parties to the contract intended that plaintiffs be beneficiaries and that such intent was within the parties’ contemplation at the time the contract was formed. 883 A.2d at 1088. (emphasis supplied)

Plaintiff-Tamburro’s reliance on the letter of September 2, 2011 is misplaced. The letter, written months after Mr. Moyer’s death, does not establish that both Mr. Moyer and defendant-attorneys intended Evan and Ava to be beneficiaries of the Genworth accounts and that such intent was within the parties’ contemplation at the time the contract was formed. See also, Hatbob v. Brown, 575 A.2d 607 (Pa. Superior Ct. 1990), nonsuit affirmed when no evidence was introduced to indicate that attorney did not carry out intent of testator.

Conclusion

For all of the reasons set forth above, the preliminary objections filed by defendants are sustained and the first amended complaint is dismissed with prejudice.


author: OVERTON, J.,

text:
    Baker v. DiDonato

      Steven H. Brush, for plaintiffs.

      Vincent J. Giusini, for defendants.
    October 1, 2013
   OVERTON, J.,

This matter is before the appellate court in response to the order reproduced below, issued on June 24, 2013.

Upon consideration of defendants’ motion for post trial relief and plaintiffs’ response thereto, if any, it is hereby ordered, ajudged and decreed that defendants’ motion is denied.

Both defendants filed an appeal.

FACTS

In 1998, Anita Baker and William DiDonato, Jr. purchased the property at 3190 Leyte Place, Philadelphia, Pennsylvania (“Leyte Place property”) for the sum of $162,500.00. Mr. DiDonato, Jr. put $50,000.00 down as a down payment, and the parties mortgaged $116,800.00 on the property. At some point, there was a refinance, and Mr. DiDonato, Jr. took $50,000.00 out of the property to purchase another building. In or about January 2003, Ms. Baker moved out of the property. In or about February 2005, a second refinance on the property with Wachovia Bank (“Wachovia loan”) took place. Part of the money from that refinance was used to consolidate various debts of the parties; including $13,500.00 that was used to pay off an auto loan of Ms. Baker. As a result of the second refinance, the mortgage on the Leyte Place property went from $ 159,000.00 or thereabout to the sum of $318,000.00. Ms. Baker also testified that she paid $16,000.00 in mortgage payments over a five-year period.

Ms. Baker entered into a new relationship, married and decided to purchase another home with her spouse but was unable to because of the outstanding Wachovia loan. On January 17, 2007, the parties of this lawsuit entered into a signed agreement with the understanding that the Leyte Place property would be refinanced and the Wachovia loan would be paid off. Additionally, at the time of refinance, Patrick and Anita Baker would receive $50,000.00 for signing over their interest in the Leyte Place property to William DiDonato, Sr. and William DiDonato, Jr..

On January 17, 2007, Mr. DiDonato, Jr. and Ms. Baker executed a deed transferring the Leyte Place property to William DiDonato, Sr. and William DiDonato, Jr. for the consideration of one (1) dollar. On or about September 5, 2007, the DiDonatos refinanced the Leyte Place property with E* Trade Financial. E*Trade Financial agreed to lend them $288,000.00; an additional $24,000.00 was required to pay off the $312,000.00 Wachovia loan. Mr. DiDonato, Sr., contributed $47,571.45, although it was actually $42,039.67 based on cash received after closing costs. On September 19, 2007, Ms. Baker received a letter from Wachovia informing her that the Leyte Place property had been refinanced. She testified that she had a conversation with the Mr. DiDonato, Jr. in 2010, in which he acknowledged that he owed her money and would pay her.

PROCEDURAL HISTORY

On September 19, 2011, Patrick & Anita Baker (hereinafter “plaintiffs”) filed a complaint for breach of contract against William J. DiDonato, Sr. & William J. DiDonato, Jr. (hereinafter “appellants”). The plaintiffs alleged that the appellants failed to pay the plaintiffs $50,000.00 per a contract entered into by the plaintiffs and the appellants on January 17, 2007.

On June 13, 2013, this court found in favor of the plaintiffs. On June 24, 2013, this court denied the appellants’ post-trial motion. On July 3,2013 the appellants filed a timely appeal. Statements of matters complained of on appeal were requested and properly tendered on July 30, 2013. The appellants raised the following issues in its statement of matters complained of on appeal pursuant to Pa. R.A.P. 1925 (b):

1. The court erred as a matter of law in finding the statute of limitations for this breach of contract action did not begin to run on the date of the refinancing of the property at issue, that being August 27,2007, where the contract specifically stated “at the time of refinance” the defendants were obligated to payoff the Baker/ DiDonato mortgage and pay the plaintiffs $50,000.00. The statute of limitations for contract actions is four (4) years from the date of breach, in this matter requiring plaintiffs to have commenced their action prior to September 19, 2011.
2. The court erred in finding the statute of limitations was tolled until September 19,2007 where the evidence unequivocally established the property at issue had been refinanced and the Wachovia loan was officially paid off and closed on September 5, 2007, as a result of the refinancing of August 27, 2007 and therefore the action was required to be brought by plaintiffs prior to September 19, 2011.
3. The court erred in finding the “discovery rule” tolled the statute of limitations as, the “discoveiy rule” is inapplicable to actions for “breach of contract,” under 13 Pa.C.S.A.sec.2725b, which provides, “A cause of action accrues when the breach occurs regardless of the aggrieved party’s lack of knowledge of the breach.” Emphasis added.
4. The court erred as a matter of law in finding the statute of limitations was not violated with a complaint fling date of September 19, 2011, more than four years after the refinancing occurred on August 27, 2007, the date referred to in the contract, “the refinancing date” as the date the Baker/DiDonato mortgage was to be paid off and the Baker plaintiffs’ were to receive$ 50,000.00.
5. The court erred in finding an implied condition precedent of the obligation to pay plaintiffs’ $50,000.00 as the property have enough equity to satisfy this obligation at the time of refinancing.
6. The court erred in finding defendants are obligated to pay plaintiff’s $36,500.00, based upon a calculation made by the court wherein the court failed to account debts which were paid off from said proceeds, which were incurred jointly by the parties and exceeded $50,000.00 in their totality. Additionally the court failed to apply any credit for the $43,500.00 check written at refinancing by defendant DiDonato, Sr., which inured to the benefit of plaintiff Anita Baker, in that it was applied to pay off the Baker/DiDonato mortgage in the amount of $312,027.37. Applying the credits properly would have resulted in 0 money owed to plaintiffs.
7. The court erred in allowing the plaintiff Anita Baker to testify regarding alleged conversations she had with defendant William DiDonato, Jr., wherein in [sic] defendant purportedly made promises to her other than those specifically set forth in the contract, as such violated the Parol Evidence Rule.
8. The court erred in finding the defendants received value consideration by acquiring ownership in a property which was mortgaged for more than its [sic] worth as a result of joint obligations of the plaintiff Anita Baker and defendant DiDonato, Jr., the court thereby disregarding the fact defendant DiDonato had written a check from his own funds for more than $47,000.00 to refinance the property in accordance with the contract and the property had no equity on the date of refinance.
9. The court erred in finding the plaintiff Anita Baker made payments towards the mortgage exclusively which were joint payments of Baker and DiDonato. Jr., as such payments were made jointly while the parties lived together in the house and all debts were shared and paid for as a couple.
10. The court erred in finding the defendants did not substantially comply with the contract by paying off the Baker/DiDonato 2005 mortgage through refinancing, where there was no equity in the property. The fact defendants refinanced and paid off a mortgage plaintiff Baker was obligated on for $ 312,027.37, established substantial performance of the contract by defendants in this matter and fair consideration to plaintiffs who were obligated in that amount to Wachovia Bank.
11. The court erred in finding the only credit defendants were entitled to was for $ 13,500.00 which was used from the 2005 Baker/DiDonato refinance to pay off Baker’s car, as defendants were entitled to against plaintiffs, including credit for the $ 47,571.45 check written by DiDonato, Sr., which inured to plaintiffs’ benefit and among other credits argued for, should have resulted in no monies being owed to the plaintiffs.
12. The court erred in finding defendants were not entitled to a finding in their favor at the conclusion of the presentation of plaintiffs’ case, based upon the defense of the statute of limitations and impossibility of performance.

This opinion is offered in response to said appeal.

DISCUSSION

Appellants’ claims are discussed in turn and are without merit.

A. Appellants’ claims 1, 2 and 4 will be addressed together.

Appellants’ claims 1, 2 and 4 all alleged that this court erred by not finding that the plaintiffs violated the four (4) year statute of limitations to bring an action for breach of contract by filing their complaint on September 19,2011. These claims are without merit. “The discovery rule...tolls the running of the applicable statute of limitations until the point where the complaining party knows or reasonably should know that he has been injured and that his injury has been caused by another party’s conduct.” Crouse v. Cyclops Indus., 745 A.2d 606, 611 (Pa. 2000). It is well settled that the courts of Pennsylvania have and continue to approve the usage of the discovery rule in contract actions.

Here, the agreement between the parties provided that at the time of the refinance the appellants would pay the plaintiffs $50,000.00. On September 19,2007, the plaintiffs received notification from Wachovia that the property had been refinanced. However, plaintiff Anita Baker testified that she had numerous conversations with appellant DiDonato, Jr., one as recent as January 2010, in which he expressed his intent to honor his contractual obligation to the plaintiffs. Therefore, applying the discovery rule, the plaintiffs had no reason to know that the appellants did not intend to honor their contractual obligation prior to January 2010. Accordingly, the filing of the complaint for breach of contract in 2011 was not outside of the four (4) year statute of limitations period. Thus, this claim is without merit.

B. The court erred in finding the “discovery rule” tolled the statute of limitations as, the “discovery rule” is inapplicable to actions for “breach of contract,” under 13 Pa.C.S.A.sec.2725b, which provides, “A cause of action accrues when the breach occurs regardless of the aggrieved party’s lack of knowledge of the breach.”

Appellants’ claim that this court erred in finding that the discovery rule tolled the statute of limitations because the discovery rule is inapplicable to breach of contract actions under 13 Pa.C.S.A.sec.2725b is without merit. The appellants are misguided in their attempt to apply 13 Pa.C.S.A.sec.2725 of the Uniform Commercial Code (“UCC”) to this action. It is well settled that the UCC does not govern real estate contracts. In fact, the UCC explicitly states that its scope is limited to “transactions in goods.” 13 Pa. Cons. Stat. Ann. §2102. The UCC defines “goods” as “all things... which are movable at the time of identification to the contract for sale other than the money in which the price is to be paid, investment securities (Division 8) and things in action.” 13 Pa. Cons. Stat. Ann. §2105(a). Therefore, given the inapplicability of the statute cited by the appellants, this claim is without merit.

C. The court erred in finding an implied condition precedent of the obligation to pay plaintiffs’ $50,000.00 was that the property must have enough equity to satisfy this obligation at the time of refinancing.

The appellants’ claim that this court erred in finding an implied condition precedent of the obligation to pay the plaintiffs’ $50,000.00 was that the property must have enough equity to satisfy this obligation at the time of refinancing is without merit. This court actually did not find there to be an implied condition precedent requiring there to be enough equity to satisfy the appellants’ obligation to pay the plaintiffs’ $50,000.00. Therefore, this claim is without merit.

D. The court erred in finding defendants are obligated to pay plaintiffs $36,500.00, based upon a calculation made by the court wherein the court failed to account debts which were paid off from said proceeds, which were incurred jointly by the parties and exceeded $50,000.00 in their totality. Additionally the court failed to apply any credit for the $43,500.00 check written at refinancing by defendant DiDonato, Sr., which inured to the benefit of plaintiff Anita Baker, in that it was applied to pay off the Baker/DiDonato mortgage in the amount of $312,027.37. Applying the credits properly would have resulted in 0 money owed to plaintiffs.

The appellants’ claim that this court erred in finding that the appellants are obligated to pay plaintiffs $36,500.00 is without merit. As this court stated when announcing its decision, this court took into account that plaintiff Anita Baker’s car loan was paid off and the credit benefit bestowed upon her by removing the substantial debt accrued by the two refinance transactions of which she was a signatory. Furthermore, the terms of the contract are clear. The appellants received the plaintiffs’ interest in the Leyte Place property so that the appellants’ could refinance the property and pay off the Wachovia loan. The appellants entered into the transaction with the knowledge that they would be taking on the outstanding Wachovia loan. Thus, to further compensate the appellants for something they contracted to do would go against the explicit terms of the contract.

Moreover, in exchange for giving up their interest in the Leyte Place property, the plaintiffs were to receive $50,000.00 from the appellants at the time of the refinance. The refinance in the context of the contract only served as a triggering date upon which the plaintiffs were to be paid. This point is bolstered by the fact that the contract is silent with regard to any equity that may or may not be in the home and the effect that would have on the appellants’ obligation to the plaintiffs. Thus, the fact that appellant DiDonato, Sr. had to pay out of pocket costs to cover the lack of equity in property has no bearing on the appellants’ contractual obligations. Therefore, this claim is without merit.

E. The court erred in allowing the plaintiff Anita Baker to testify regarding alleged conversations she had with defendant William DiDonato, Jr., wherein defendant purportedly made promises to her other than those specifically set forth in the contract, as such violated the Parol Evidence Rule.

The appellants’ claim that this court erred in allowing plaintiff Anita Baker to testify regarding alleged conversations she had with appellant DiDonato, Jr., wherein appellant DiDonato, Jr. purportedly made promises to her other than those specifically set forth in the contract, as such violated the parol evidence rule is without merit. “[T]he parol evidence rule seeks to preserve the integrity of written agreements by refusing to permit the contracting parties to attempt to alter the import of their contract through the use of contemporaneous oral declarations. Rose v. Food Fair Stores, Inc., 262 A.2d 851, 853 (Pa. 1970) (emphasis added).

Here, plaintiff Anita Baker stated that appellant DiDonato, Jr. told her that “I know I owe you the money, and I am going to give it to you.” (N.T. 06/13/13 at p. 18). This parol evidence was not offered to alter the contract between the parties. The evidence showed the appellants’ acknowledgement of his contractual obligation as it was written. Therefore, this claim is without merit.

F. The court erred in finding the defendants received value consideration by acquiring ownership in a property which was mortgaged for more than its worth as a result of joint obligations of the plaintiff Anita Baker and defendant DiDonato, Jr., the court thereby disregarding the fact defendant DiDonato had written a check from his own funds for more than $47,000.00 to refinance the property in accordance with the contract and the property had no equity on the date of refinance.

The appellants’ claim that this court erred in finding the appellants received value consideration by acquiring ownership in a property which was mortgaged for more than its worth is without merit. In contract law “[t]he requirement of consideration, of course, is nothing more than a requirement that there be a bargained for exchange.” Com. Dep’t of Transp. v. First Pennsylvania Bank, N.A., 466 A.2d 753, 754 (1983). Here, the appellants agreed to pay the plaintiffs’ $50,000.00 for their interest in the Leyte Place property. There is no doubt that complete ownership of a property in exchange for an agreed upon sum is enough to satisfy the requirement of consideration.

Furthermore, as previously stated by this court, the appellants entered into this agreement knowing that the property was encumbered with an outstanding mortgage. Thus, the fact that the equity in the home was not enough to cover the outstanding mortgage has no bearing on the contractual obligations of the parties. Again, this point is bolstered by the fact that the contract is silent when it comes to the equity of the home. Accordingly, the fact that appellant DiDonato, Sr. had to pay out of pocket costs to cover the lack equity in property is of no moment. The courts are not to be used by parties to compensate them for entering into an agreement that turned out to be not as advantageous to them as originally thought. Therefore, this claim is without merit.

G. The court erred in finding the plaintiff Anita Baker made payments towards the mortgage exclusively which were joint payments of Baker and DiDonato. Jr., as such payments were made jointly while the parties lived together in the house and all debts were shared and paid for as a couple.

The appellants’ claim that this court erred in finding the plaintiff Anita Baker made payments towards the mortgage exclusively is without merit. “[I]t is within the sole province of the trier of fact to pass upon the credibility of witnesses and the weight to be accorded the evidence produced.” Commonwealth v. Sample, 468 A.2d 799, 803 (Pa. Super. 1983) (emphasis added). That said, plaintiff Anita Baker testified that she made mortgage payments for approximately five (5) years. This testimony was uncontroverted. Therefore, this court, as fact finder, made a determination to accept the veracity of the testimony. Given that determinations of fact and witness credibility are within the sole province of the fact finder, this claim is without merit.

H. The court erred in finding the defendants did not substantially comply with the contract by paying off the Baker/DiDonato 2005 mortgage through refinancing, where there was no equity in the property. The fact defendants refinanced and paid off a mortgage plaintiff Baker was obligated on for $ 312,027.37, established substantial performance of the contract by defendants in this matter and fair consideration to plaintiffs who were obligated in that amount to Wachovia Bank.

The appellants’ claim that this court erred in finding the appellants did not substantially comply with the contract by paying off the Wachovia loan through refinancing, where there was no equity in the property is without merit. As this court has already stated numerous times, the appellants agreed to pay the plaintiffs’ $50,000.00 for their interest in the Leyte Place property. The appellants entered into this agreement with full knowledge of the outstanding mortgage on the property. Thus, the fact that the appellants paid off the mortgage had absolutely no bearing on the contractual obligations of the parties. Therefore, the appellants’ did not substantially perform and this claim is without merit.

I. The court erred in finding the only credit defendants were entitled to was for $13,500.00 which was used from the 2005 Baker/DiDonato refinance to pay off Baker’s Car, as defendants were entitled to against plaintiffs, including credit for the $ 47,571.45 check written by DiDonato, Sr., which inured to plaintiffs’ benefit and among other credits argued for, should have resulted in no monies being owed to the plaintiffs.

For the reasons stated in both Section D and F, this claim is without merit.

J. The court erred in finding defendants were not entitled to a finding in their favor at the conclusion of the presentation of plaintiffs’ case, based upon the defense of the statute of limitations and impossibility of performance.

The appellants’ claim that this court erred in finding that the appellants were not entitled to a finding in their favor at the conclusion of the presentation of plaintiffs’ case, based upon the defense of the statute of limitations and impossibility of performance is without merit. For the reasons stated in section A, appellants’ defense of the statute of limitations is without merit.

Further, Pa. R. Civ. P. 1030(a) requires that “all affirmative defenses including but not limited to... impossibility of performance...shall be pleaded in a responsive pleading under the heading ‘New Matter.’” Appellants’ trial counsel conceded that the defense of impossibility of performance was not pled. Accordingly, the defense was waived and this claim is without merit.

CONCLUSION

The court’s order dated June 24, 2013, denying appellant’s post-trial motion should be affirmed.

      . This statement of facts is a restatement of this court’s factual findings. See N.T. 06/13/13 at p. 85-88.

        . See 42 Pa.C.S.A. §5525.

      . See Gustine Uniontown Associates, Ltd. v. Anthony Crane Rental, Inc., L.P., 842 A.2d 334, 344 (Pa. 2004).

      . It should be noted that appellant DiDonato, Jr. took significant amounts of equity out of the Leyte Place property at various points during the ownership of the property. SeeN.T. 06/13/13 at p. 11 and 13.

      . See N.T. 06/13/13 atp. 38.