author: HERRON, J.,

text:
    Hydrair Inc. v. National Environmental Balancing Bureau

      Allen L. Feingold, for plaintiffs.

      Alan Sternstein, Carla D. Pratt and Jeff Almeida, for defendants NEBB and Dolim.

      John Widman and Chad Wishchuk, for defendants PEBA and Salkin.

      Melvin Schuster, for defendants EAB and Roaten.

      Chris Lee, for defendants Casey, Carlin Management and Reardon.
    April 23, 2001
   HERRON, J.,

Defendants National Environmental Balancing Bureau, Pennsylvania Environmental Balancing Association, Eastern Air Balance Inc., Bobby Roaten, Ted Salkin, Patricia Casey, Michael Dolim, Carlin Management and William Reardon filed six sets of preliminary objections to the second amended complaint of plaintiffs Hydrair Inc. and Albert Hawkins. The court sustains the objections in part.

BACKGROUND

NEBB is a trade association that certifies environmental balancing firms. NEBB’s offices are in Gaithersburg, Maryland. Dolim is a former vice-president of NEBB. He has not worked for NEBB since November 30, 1999.

PEBA is the Pennsylvania chapter of NEBB. Carlin Management is the company that PEBA hired to manage its office. Reardon is an owner of Carlin Management and secretary or treasurer of PEBA. Casey is a Carlin Management employee who serves as PEBA’s office manager. Salkin is chairman of the PEBA technical committee. Roaten is the former president of PEBA.

Environmental balancing firms test and balance heating and air conditioning systems. EAB and Hydrair are Pennsylvania environmental balancing firms and are competitors. Roaten is the president and owner of EAB, and Hawkins is an employee of Hydrair.

Until this year, plaintiffs held a NEBB certification to perform balancing work. The plaintiffs allege that the defendants conspired to revoke the plaintiffs’ certification by misrepresenting the quality of the plaintiffs’ balancing work to each other and to plaintiffs’ customers. Plaintiffs allege that, without the certification, they cannot perform balancing work.

On February 25,2000, plaintiffs Hydrair and Hawkins filed the original complaint against defendants NEBB, PEBA, EAB and Roaten. On July 27, 2000, the court sustained in part these defendants’ preliminary objections to the complaint and granted the plaintiffs leave to file an amended complaint within 20 days. The plaintiffs filed an amended complaint on August 21, 2000— five days late. Defendants filed preliminary objections, including an objection to strike the amended complaint as untimely. Instead of answering the preliminary objections, the plaintiffs filed a second amended complaint. The second amended complaint added Salkin, Casey, Dolim, Carlin Management and Reardon as defendants. The defendants again filed preliminary objections, including a motion to strike the second amended complaint based on the untimeliness of the first amended complaint. The court sustained the objection to untimeliness and struck the second amended complaint. On motion for reconsideration the court vacated that order.

At issue now are the preliminary objections to the second amended complaint. The second amended complain—which is not a model of clarity—has five counts. Count I asks for an injunction against only NEBB that orders NEBB to restore the certification. Count II claims tortious interference with contractual relations against all defendants. The plaintiffs base this claim on two sets of actions: Roaten and EAB’s interference with Hydrair’s existing balancing contracts with two school districts and all defendants’ participation in decertifying the plaintiffs, such that plaintiffs could not get future balancing contracts. Count III claims fraud against all defendants. Count IV claims defamation against all defendants except NEBB based on derogatory statements about the quality of the plaintiffs’ work. Count V claims conspiracy to defame against all defendants except NEBB.

DISCUSSION

I. The Court Overrules the Objections to Plaintiffs’ Untimely Amendment of the Complaint

NEBB objects to the second amended complaint as untimely. The court overrules the objection. In their motion for reconsideration, the plaintiffs set forth just cause for the five-day delay, and the court sees no preju-

dice accruing to the defendants from the delay. Peters Creek Sanitary Authority v. Welch, 545 Pa. 309, 314-15, 681 A.2d 167, 170 (1996).

II. The Court Sustains Dolim’s Objection to Improper Form of Service

Dolim objects on the ground of improper service of the second amended complaint and lack of personal jurisdiction. The court sustains the objections and quashes service on Dolim.

Under Pennsylvania’s Long-Arm Statute, a plaintiff may serve a defendant outside of Pennsylvania by any form of mail addressed to the defendant and requiring a signed receipt. 42 Pa.C.S. §5323(a)(3). The defendant or his authorized agent must sign the return receipt. Pa.R.C.P. 403 and 404(2). The certificate of service that the plaintiffs filed with the prothonotary shows that the plaintiffs sent a copy of the second amended complaint to NEBB in Gaithersburg, Maryland. Attached to the certificate of service are the transmittal letter addressed to Dolim at NEBB and the return receipt addressed only to NEBB, received on October 16, 2000 and bearing the signature of what appears to be “Toni Day.” Dolim did not sign the receipt. Without Dolim’s signature, service was not proper. Pa.R.C.P. 403.

In their brief, plaintiffs argue that service was proper because they served NEBB and NEBB is Dolim’s agent. The court disagrees for two reasons. First, the certificate of service that plaintiffs filed is not sufficient for this court to find that NEBB or Day was Dolim’s authorized agent to accept service of process. Pa.R.C.P. 405(b) (“A return of service shall set forth ... the identity of the person served and any other facts necessary for the court to determine whether proper service has been made.”); Neff v. Tribune Printing Co., 421 Pa. 122, 125, 218 A.2d 756, 757 (1966) (stating that there is no presumption of validity of service of process, and holding service was invalid where, among other things, the return of service did not set forth the agency of the person served). Second, the plaintiffs have admitted that Dolim has not appointed an agent for service of process. In paragraph 26 of his preliminary objections, Dolim alleges that he “has not authorized any person at NEBB’s offices or anyone else to accept, receive or sign for service of process on his personal behalf.” In violation of Pa.R.C.P. 1029(a) and Phila.Civ.R. *1028 (C)(1), plaintiffs did not specifically admit or deny this factual averment or assert lack of knowledge under Pa.R.C.P. 1029(c). Instead, plaintiffs answered paragraph 26 as follows: “Denied. This allegation avers matters outside the four corners of the complaint and is thus not cognizable by way of preliminary objection.” Answer to Dolim’s preliminary objections ¶26. The plaintiffs are incorrect in arguing that they need not specifically answer this objection raising outside evidence. The rules specifically provide for the admission of outside evidence to resolve an objection raising issues of fact about improper service. Pa.R.C.P. 1028(c)(2) and note. Had plaintiffs specifically denied paragraph 26 or alleged lack of knowledge, the court might have ordered discovery to resolve the objection. But because plaintiffs did not specifically admit or deny paragraph 26 or assert a lack of knowledge, the court must deem plaintiffs to have admitted that Dolim has not authorized anyone at NEBB to accept service for him. Pa.R.C.P. 1029(b); Cercone v. Cercone, 254 Pa. Super. 381, 386, 386 A.2d 1, 4 (1978). Therefore, Day was not Dolim’s agent to accept service.

Plaintiffs also argue that service was proper because they served Dolim at his usual place of business. The court disagrees. A plaintiff may serve process by handing the complaint at the “office or usual place of business of the defendant to his agent or the person for the time being in charge of the office.” See Pa.R.C.P. 402(a)(2)(iii) and 404(1). Because plaintiffs mailed a copy of the complaint, the service-by-hand rules do not apply. Pa.R.C.P. 403 governs service by mail. See also, Pa.R.C.P. 404(2). Since that rule contains no provision allowing a person in charge of a defendant’s office to sign for the defendant, such service is ineffective. Weaver v. Martin, 440 Pa. Super. 185, 193, 655 A.2d 180, 193 (1995) (stating that service of process by mail is allowed only pursuant to the limited procedures under Pa.R.C.P. 403, and holding that service was improper where plaintiff’s attempted service by mail did not follow any of those limited procedures).

Plaintiffs did not properly serve Dolim and the court cannot exercise personal jurisdiction over Dolim. Sharp v. Valley Forge Medical Center and Heart Hospital, 422 Pa. 124, 127, 221 A.2d 185, 187 (1966) (“The rules relating to service of process must be strictly followed, and jurisdiction of the court over the person of the defendant is dependent upon proper service having been made. . . .”). The court sustains the preliminary objection to improper service and personal jurisdiction. The court will order service of the complaint on Dolim stricken. Should the plaintiffs have the complaint reinstated, they shall serve Dolim in Pennsylvania within 30 days after that reinstatement or outside of Pennsylvania within 90 days after that reinstatement. See Pa.R.C.P. 401 and 404; Collins v. Park, 423 Pa. Super. 601, 606, 621 A.2d 996, 999 (1993) (holding that, “[wjhere service of process is defective, the proper remedy is to set aside the service[,]” and that plaintiff cannot proceed against defendant until plaintiff effects proper service on the defendant).

Because the lack of effective service deprives the court of personal jurisdiction over Dolim, the court need not now consider Dolim’s other arguments regarding lack of personal jurisdiction. Dolim may raise these arguments again should plaintiffs serve Dolim properly.

Dolim also alleges that plaintiffs did not attach copies of all prior pleadings to the process that they attempted to serve on Dolim. Pa.R.C.P. 425(a). The court deems plaintiffs’ failure to specifically deny this factual allegation as an admission that they did not attach the pleadings. Pa.R.C.P. 1029(b); Cercone, 254 Pa. Super. at 386, 386 A.2d at 4. Though a violation of Pa.R.C.P. 425(a) would not ordinarily warrant striking service, it would warrant an order that plaintiffs serve Dolim with the omitted pleadings. Almart Stores v. Liberty Shop Ctr., 54 D.&C.2d 415, 418 (C.P. Lehigh 1972); Jacobs v. Brooks, 69 D.&C.2d 112, 114 (C.P. Somerset 1972); 2 Goodrich-Amram 2d §425(a)(2). Should plaintiffs attempt to serve Dolim again, that service shall include all prior pleadings.

III. The Court Overrules NEBB’s Preliminary Objection to Count I (Injunction)

Count I seeks to enjoin NEBB from decertifying plaintiffs. NEBB argues that Count I is insufficiently specific and legally insufficient because Count I does not identify any bylaw, statute or common law that NEBB.violated. The court disagrees and overrules the objection.

Count I alleges that defendants’ actions in decertifying the plaintiffs were “omissions to do acts which are specifically required to be done under the NEBB bylaws and under the statutory and common law, the requirements of which are incorporated under the NEBB charter and bylaws.” Second amended complaint ¶48. The court interprets the “acts which are specifically required . . . under common law” as referring to the tort claims against NEBB in Counts II and III. The claim for tortious interference in Count II, if proven, would support a claim for an injunction. See Adler, Barish, Daniels, Levin and Creskoff v. Epstein, 482 Pa. 416, 393 A.2d 1175 (1978) (affirming trial court’s order enjoining tortious interference with contractual relations). Therefore, the court must overrule NEBB’s objection to Count I.

The court notes, however, that the plaintiffs’ claim for an injunction must depend entirely upon their right to relief for tortious interference, for the plaintiffs’ claim under the bylaws is not legally sufficient and is insufficiently specific. Count I alleges that the NEBB bylaws give plaintiffs the right to notice of allegations and the right to a full and fair evidentiary hearing, and that NEBB violated these rights. Second amended complaint ¶¶49, 50. In considering this preliminary objection, the court accepts as true the factual allegation that the bylaws state that plaintiffs shall receive notice of allegations and a full and fair evidentiary hearing. Borden v. Baldwin, 444 Pa. 577, 281 A.2d 892 (1971). But the court need not accept as true plaintiffs’ legal conclusion that these provisions confer legally enforceable rights on the plaintiffs. Detweiler v. Borough of Hatfield School District, 376 Pa. 555, 559, 104 A.2d 110, 113 (1954) (though court must accept as true the plaintiff’s factual averments as to the contents of a writing, the court is not bound by plaintiff’s legal interpretation of these provisions). In their complaint, plaintiffs cite no law giving plaintiffs the right to enforce the bylaws against NEBB. In their brief, plaintiffs do not even discuss Count I. Do plaintiffs base their right to enforce the bylaws on contract law? Do plaintiffs base their claim on tort law? Do they base it on the Maryland General Corporation Law? Md.Code., Corps. & Ass’ns §1-101 et seq. After three rounds of pleading, the court still can only speculate as to plaintiffs’ legal theory; and the plaintiffs’ failure to attach a copy of the bylaws—which defendants produced to plaintiffs during discovery—compounds the court’s confusion. Therefore, if plaintiff’s tortious interference claim eventually fails, so must its claim for an injunction.

IV. The Court Sustains in Part the Preliminary Objections to Count II (Tortious Interference)

Count II alleges that the defendants tortiously interfered with Hydrair’s existing and prospective contractual relations. The defendants object on the grounds of legal insufficiency and insufficient specificity. The court sustains these objections in part.

The elements of a claim for tortious interference with existing or prospective contractual relations are

“(1) the existence of a contractual, or prospective contractual relation between the complainant and a third party;
“(2) purposeful action on the part of the defendant, specifically intended to harm the existing relation, or to prevent a prospective relation from occurring;
“(3) the absence of privilege or justification on the part of the defendant; and
“(4) the occasioning of actual legal damage as a result of the defendant’s conduct.” Strickland v. University of Scranton, 700 A.2d 979, 985 (Pa. Super. 1997) (citations omitted), quoted in Flynn Corp. v. Cytometrics, June 2000, no. 2102, op. at 11 (C.P. Phila. Nov. 17, 2000) (Sheppard, J.). “Absence of privilege or justification” means that the defendant’s conduct was “improper.” Cloverleaf Development Inc. v. Horizon Financial F.A., 347 Pa. Super. 75, 83-84, 500 A.2d 163, 167 (1985) (citing Restatement (Second) of Torts §767 for six factors to consider when determining whether defendant’s conduct was improper). The plaintiffs must show actual pecuniary loss. Shiner v. Moriarty, 706 A.2d 1228, 1238 (Pa. Super. 1998). They cannot recover solely for emotional distress or injury to reputation. Id.

A. Hawkins’ Tortious Interference Claims

As did the original complaint, the second amended complaint fails to allege the existence of a contract to which Hawkins was a party or a prospective contract to which he would be a party. Therefore, the court sustains the demurrers of all defendants to Hawkins’ tortious interference claim in Count II. Rutherfoord v. Presbyterian-University Hospital, 417 Pa. Super. 316, 332, 612 A.2d 500, 507 (1992) (stating that the existence of a contractual relationship between the plaintiff and a third person is an essential element of tortious interference).

B. Hydrair’s Tortious Interference Claims

Hydrair’s tortious interference claim is legally sufficient against all defendants except Reardon.

1. Hydrair’s claims for tortious interference with existing contractual relations

Hydrair states a legally sufficient claim against Roaten and EAB for tortious interference with existing contractual relations based on the Hamburg and Kunkle contracts. The complaint identifies contractual relations with third parties: Hamburg and Kunkle school districts. The complaint alleges that Roaten and EAB acted purposefully to harm those relations: they made false statements to the Hamburg and Kunkle school districts in an effort to take over those jobs. Second amended complaint ¶¶20, 34-36. The complaint alleges that the actions of Roaten and EAB were unprivileged, second amended complaint ¶48, and sufficiently alleges that Roaten and EAB acted improperly: they made false statements to Hamburg and Kunkle. Birl v. Philadelphia Electric Co., 402 Pa. 297, 301, 167 A.2d 472, 474-75 (1960) (allegation that defendant made false statements to plaintiff’s employer with purpose and result of inducing employer to terminate plaintiff employee stated legally sufficient claim of intentional interference with contract); Evans v. Philadelphia Newspapers Inc., 411 Pa. Super. 244, 249, 601 A.2d 330, 333 (1991) (stating that plaintiff may base claim of intentional interference on a variety of torts including defamation); see also, Restatement (Second) of Torts, §768, cmt. h (stating that competition is not a defense to intentional interference with an existing contract). The complaint alleges actual damage: Roaten and EAB caused Hydrair to be delayed in finishing the Hamburg job and caused Hydrair to lose the Kunkle job. See Kelly-Springfield Tire Co. v. D’Ambro, 408 Pa. Super. 301, 308, 596 A.2d 867, 871 (1991) (holding that allegation that defendant’s interference caused unnecessary delay in the sale of plaintiff’s property to a third party was a sufficient allegation of actual damage).

2. Hydrair’s claim for tortious interference with prospective contractual relations

Hydrair states a legally sufficient claim against all defendants except Reardon for tortious interference with prospective contractual relations. Hydrair does not identify any specific prospective contracts with third parties, but instead alleges that defendants’ conduct completely barred Hydrair from doing business in its territory. Second amended complaint ¶46. This is a sufficient allegation that prospective contractual relations existed. Hydrair need not identify specific prospective contracts. See Kelly-Springfield Tire Co., 408 Pa. Super. at 309, 596 A.2d at 871 (holding that plaintiff’s complaint was not deficient for failing to identify a specific prospective contractual relation, because “prospective contractual relations are, by definition, not as susceptible of definite, exacting identification as is the case with an existing contract with a specific person”).

The complaint alleges specific purposeful actions by NEBB, PEBA, Roaten, EAB, Salkin, Casey, Carlin Management and Dolim to decertify Hydrair. Second amended complaint ¶¶22, 24, 29, 33, 34, 37, 38, 39. The court can reasonably deduce from the complaint that NEBB certification is a requirement for obtaining a balancing contract, see second amended complaint ¶¶46 and 51, and that these defendants would have known that the substantially certain result of decertification would be Hydrair’s inability to get balancing contracts. Field v. Philadelphia Electric Co., 388 Pa. Super. 400, 417, 565 A.2d 1170, 1178 (1989) (stating that “intent extends both to the desired consequences and to the consequences substantially certain to follow from the act.”); Restatement (Second) of Torts §8A (stating that “intent” means “that the actor desires to cause [the] consequences of his act, or that he believes that the consequences are substantially certain to result from it.”). See also, B.T.Z. Inc. v. Grove, 803 F. Supp. 1019, 1023 (M.D. Pa. 1992) (stating that the intent required for a tortious interference claim can be inferred where the result is substantially certain to occur). Therefore, the complaint sufficiently alleges that these defendants “took purposeful action . . . specifically intended ... to prevent” Hydrair from getting balancing contracts. Strickland, 700 A.2d at 985. But the second amended complaint does not allege any specific actions by Reardon. It only alleges that Reardon was the “owner/ member” of Carlin Management, that he was “secretary and/or treasurer of PEBA,” that he ran “the daily workings of PEBA,” that he hired Casey, that he was a co-conspirator and that he caused PEBA’s members to vote for Hydrair’s decertification. Second amended complaint ¶¶27, 33, 37. Since there are no allegations of specific conduct by Reardon causing plaintiffs’ decertification, the tortious interference claim against Reardon is legally insufficient and insufficiently specific.

The complaint specifically alleges that the defendants’ actions were not privileged, second amended complaint ¶48, and it alleges sufficient facts such that the court cannot now conclude that the defendants did not act improperly. Second amended complaint ¶¶22, 33, 37, 38, 40. See Creeger Brick & Bldg. Supply Inc. v. Mid-State Bank & Trust Co., 385 Pa. Super. 30, 33, 560 A.2d 151, 152 (1989) (“If there is any doubt as to whether a claim for relief has been stated, the trial court should resolve it in favor of overruling the demurrer.”).

The complaint alleges actual damage: the decertification made Hydrair unable to get balancing contracts.

C. The Demand for Punitive Damages

Roaten, EAB, Carlin Management, Dolim and Casey object to the demand for punitive damages in Count II. A plaintiff may recover punitive damages for tortious interference when the defendant’s “actions are of such an outrageous nature as to demonstrate intentional, willful, wanton or reckless conduct. . . .” SHV Coal Inc. v. Continental Grain Co., 526 Pa. 489, 493, 587 A.2d 702, 704 (1991). The complaint alleges intentional acts by Roaten, EAB, Dolim, Casey and Carlin, and the court overrules their objections to the punitive damages demand in Count II.

In summary the court (1) sustains Reardon’s objections to Count II; (2) sustains the objections of the NEBB, PEBA, Roaten, EAB, Salkin, Casey, Dolim and Carlin Management to Hawkins’ claims in Count II; (3) overrules the objections of NEBB, PEBA, Roaten, EAB, Salkin, Casey, Dolim and Carlin Management to Hydrair’s claims in Count II; and (4) overrules the objections of Roaten, EAB, Carlin Management, Dolim and Casey to the demand for punitive damages in Count II.

V. The Court Sustains the Defendants’ Preliminary Objections to Count III (Fraud)

Count III alleges that the defendants fraudulently crafted complaints about plaintiffs’ work on the Kunkle and Hamburg jobs and other jobs. The defendants argue that Count III is legally insufficient and insufficiently specific. The court agrees. Two of the elements of fraud are a misrepresentation by the defendant and the plaintiff’s justifiable reliance on the misrepresentation. Bortz v. Noon, 566 Pa. 489, 729 A.2d 555, 560 (1999). As in the original complaint, there is no allegation in the second amended complaint that the defendants made a statement to the plaintiffs on which the plaintiffs relied. Instead, the second amended complaint alleges that the defendants made false statements to others—to Hydrair’s customers and to each other—which caused plaintiffs harm. The court sustains the preliminary objections of the defendants to Count III.

VI. The Court Sustains in Part the Preliminary Objections to Count IV (Defamation)

Count IV of the complaint alleges that PEBA, EAB, Roaten, Casey, Dolim, Carlin, Reardon and Salkin defamed the plaintiffs. In the July 27, 2000 opinion addressing the preliminary objections to the original complaint, the court held that plaintiffs had stated a legally sufficient claim for defamation against PEBA, EAB and Roaten. Casey, Dolim, Reardon, Carlin Management and Salkin argue that Count III is legally insufficient and insufficiently specific. The court sustains the objections in part.

A claim for defamation must generally allege: “(1) the defamatory character of the communication; (2) publication; (3) that the communication refers to the plaintiff; (4) the third party’s understanding of the communication’s defamatory character; and (5) injury.” Walder v. Lobel, 339 Pa. Super. 203, 213, 448 A.2d 622, 627 (1985), quoting Raneri v. DePolo, 65 Pa. Commw. 183, 186, 441 A.2d 1373, 1375 (1982); 42 Pa.C.S. §8343(a). The complaint must allege with particularity, among other things, the content of the defamatory oral or written statements, the identity of the persons making such statements, and the identity of the persons to whom the statements were made. Itri v. Lewis, 281 Pa. Super. 521, 523, 422 A.2d 591, 592 (1980). “A publication is defamatory if it tends to blacken a person’s reputation or expose him to public hatred, contempt, or ridicule, or injure him in his business or profession.” Agriss v. Roadway Express Inc., 334 Pa. Super. 295, 305, 483 A.2d 456, 461 (1984).

The second amended complaint states a legally sufficient claim for defamation against Casey and Carlin Management. The complaint alleges that Casey wrote NEBB that she had been receiving numerous complaints about plaintiffs for years. This alleged statement supports an action for defamation per se because it could impute that plaintiffs lacked competence in the balancing trade. Holland v. Flick, 212 Pa. 201, 61 A. 828 (1905); Price v. Conway, 134 Pa. 340, 19 A. 687 (1890); Zerpol Corp. v. DMP Corp., 561 F. Supp. 404, 409-410 (E.D. Pa. 1983). The circumstances in which Casey made these statements—in a letter recommending decertification of plaintiffs based on poor performance— increases their defamatory nature. The defamation claim against Carlin Management is legally sufficient because the complaint sufficiently alleges that Casey acted within the scope of her authority when writing the letters. Restatement (Second) of Agency §247. Therefore, the court overrules the demurrer and specificity objections of Casey and Carlin Management to Count IV.

Casey and Carlin Management also object to the demand for punitive damages in Count IV. A plaintiff may recover punitive damages for defamation when the defendant acted with actual malice. Bargerstock v. Washington Greene Community Action Corp., 397 Pa. Super. 403, 411, 580 A.2d 361, 366 (1990). Actual malice means that the defendants published the defamatory statement with knowledge that it was false or with reckless disregard of whether it was false. Id. The complaint does not allege that Casey wrote the letter with knowledge that her statements in the letter were false or with reckless disregard of whether they were false. Therefore, the court sustains the objection of Casey and Carlin Management to the demand in Count IV for punitive damages.

The second amended complaint does not specifically identify any statements by Dolim or Reardon. It does not identify any statements by Salkin except statements by him to the plaintiffs. Therefore, the court sustains the objections of Dolim, Reardon and Salkin to Count IV. Itri, 281 Pa. Super. at 523, 422 A.2d at 592.

VII. The Court Sustains the Defendants ’ Preliminary Objections to Count V (Conspiracy To Defame)

Count V alleges that PEBA, EAB, Roaten, Salkin, Casey, Carlin Management, Reardon and Dolim conspired to defame the plaintiffs. To state a cause of action for conspiracy, plaintiffs must allege a combination of two or more persons acting with a common purpose to do an unlawful act by unlawful means or for an unlawful purpose. Baker v. Rangos, 229 Pa. Super. 333, 351, 324 A.2d 498, 506 (1974). The second amended complaint alleges that

“At all times material hereto, Roaten, Reardon, Casey, [Salkin], Dolim, Carlin Management, Eastern Air Balance and PEBA acted as the agents, servants, workmen and/or employees of defendants] PEBA & NEBB and were then and there acting within the scope of their agency, servitude, work and/or employment, as well as in their capacity as agents, servants and employees for each other.” Second amended complaint ¶13.

Accepting this allegation as true, EAB, Roaten, Salkin, Dolim, Casey, Carlin Management and Reardon were agents of PEBA and were, for the purposes of the plaintiffs’ conspiracy claim, a single entity. Perrige v. Horning, 440 Pa. Super. 31, 43, 654 A.2d 1183, 1189 (1995) (stating that “averments of agency generally are considered as admitted facts for the purposes of demurrer, rather than as conclusions of law”). A single entity cannot conspire with itself. Rutherfoord v. Presbyterian-University Hospital, 417 Pa. Super. 316, 333-34, 612 A.2d 500, 508 (1992). Because the plaintiffs do not allege that this single entity conspired with a second person, plaintiffs’ conspiracy claim is legally insufficient. Id.; Baker, 229 Pa. Super. at 351, 324 A.2d at 506. The court sustains the objections of PEBA, Roaten, EAB, Salkin, Casey, Carlin Management and Reardon to Count V.

VIII. The Court Sustains Casey and Carlin’s Objection for Failure To Attach a Writing

All claims against Casey and Carlin Management are based on the letter that Casey sent to NEBB. Casey and Carlin Management object because the plaintiffs did not attach a copy of the letter to the second amended complaint. Pa.R.C.P. 1019 and 1028(a)(2). When a claim is based on a writing, “the pleader shall attach a copy of the writing, or the material part thereof, but if the writing or copy is not accessible to the pleader, it is sufficient so to state, together with the reason, and to set forth the substance in writing.” Pa.R.C.P. 1019(i). Plaintiffs did not attach a copy of the letter, and they did not state that they do not have access to the writing. Therefore, the court sustains the objection for failure to conform with Pa.R.C.P. 1019(i).

CONCLUSION

The court will enter a contemporaneous order sustaining in part the defendants’ preliminary objections in accordance with this opinion. As there were dozens of objections by nine defendants to one confusing complaint, the order is lengthy.

ORDER

And now, April 23, 2001, upon consideration of the preliminary objections of all defendants to the complaint and plaintiffs’ response, and in accordance with the court’s contemporaneously-filed memorandum opinion, the court hereby orders the following:

Defendant Dolim

(1) Dolim’s preliminary objections based on improper service and lack of personal jurisdiction are sustained.

(2) Service of the complaint on Dolim is stricken.

(3) Should the plaintiffs have the second amended complaint reinstated against Dolim, plaintiffs shall serve Dolim in Pennsylvania within 30 days after reinstatement of the second amended complaint or outside Pennsylvania within 90 days after reinstatement.

(4) Dolim’s objections to Hawkins’ claim in Count II are sustained.

(5) Dolim’s objections to Hydrair’s claim in Count II, including the objection to the demand for punitive damages, are overruled.

(6) Dolim’s objections to Counts III, IV and V are sustained.

Defendant NEBB

(7) NEBB’s objection to the second amended complaint based on untimeliness is overruled.

(8) NEBB’s objections to Hawkins’ claims in Counts I and II are sustained.

(9) NEBB’s objections to Hydrair’s claim in Counts I and II are overruled.

(10) NEBB’s objections to Count III are sustained.

Defendant PEBA

(11) PEBA’s objections to Hawkins’ claims in Count II are sustained.

(12) PEBA’s objections to Hydrair’s claims in Count II are overruled.

(13) PEBA’s objections to Counts III and V are sustained.

Defendant Salkin

(14) Salkin’s objections to Hawkins’ claims in Count II are sustained.

(15) Salkin’s objections to Hydrair’s claims in Count II are overruled.

(16) Salkin’s objections to Counts III, IV and V are sustained.

Defendants Roaten and EAB

(17) Roaten and EAB’s objections to Hawkins’ claims in Count II are sustained.

(18) Roaten and EAB’s objections to Hydrair’s claims in Count II, including the objection to the demand for punitive damages, are overruled.

(19) Roaten and EAB’s objections to Counts III and V are sustained.

(20) Roaten and EAB’s objections to Count IV, including the objection to the demand for punitive damages, are overruled.

(21) Roaten and EAB’s objection to the plaintiffs’ verification is overruled.

Defendants Casey, Carlin Management and Reardon

(22) Reardon’s preliminary objections to Counts II through V are sustained.

(23) Casey and Carlin Management’s objections to Hawkins’ claims in Count II are sustained.

(24) Casey and Carlin Management’s objections to Hydrair’s claims in Count II, including the objection to the demand for punitive damages, are overruled.

(25) Casey and Carlin Management’s objections to Counts III and V are sustained.

(26) Casey and Carlin Management’s demurrers and specificity objections to Count IV are overruled.

(27) Casey and Carlin Management’s objections to the punitive damages claim in Count IV are sustained.

(28) Casey and Carlin Management’s objections for failure to attach a writing are sustained.

(29) The plaintiffs shall file a third amended complaint within 20 days of the entry of this order.

      . Plaintiffs do not argue that service was proper under Maryland law. 42 Pa.C.S. §5323(a) (“When the law of this Commonwealth authorizes service of process outside this Commonwealth, the service, when reasonably calculated to give actual notice, may be made... (2) In the manner provided or prescribed by the law of the place in which the service is made for service in that place in an action in any of its courts of general jurisdiction.”).

      . Though plaintiffs did not attach a copy of the bylaws to their complaint, defendants did not object to this defect.

      . NEBB attached a copy of the bylaws to their March 7, 2000 response to plaintiffs’ petition for a preliminary injunction. It is not clear whether the court may consider these bylaws in determining the preliminary objections. Compare Eberhart v. Nationwide Mutual Insurance Co., 238 Pa. Super. 558, 563-64, 362 A.2d 1094, 1097 (1976) (holding that court cannot consider writing introduced into record by defendant making preliminary objection unless plaintiff admits the authenticity of the writing) with Detweiler v. Borough of Hatfield School District, 376 Pa. 555, 559, 104 A.2d 110, 113 (1954) (holding that, under an exception to the speaking demurrer rale, court may consider writing introduced into record by defendant making preliminary objection if plaintiff bases his claims on the writing) and Satchell v. Insurance Placement Facility of Pennsylvania, 241 Pa. Super. 287, 292, 361 A.2d 375, 377 (1976) (same). Even were the court to consider the copy of the bylaws, however, the result would not change, for the bylaws do not expressly set forth the rights to which plaintiffs claim they are entitled. See Framlau Corp. v. Delaware County, 223 Pa. Super. 272, 277, 299 A.2d 335, 338 (1972) (holding that, to the extent that a plaintiff’s allegations are inconsistent with the writing upon which the plaintiff bases a claim, the writing governs).

      . The court does not read the second amended complaint as alleging that any defendants except Roaten and EAB induced Kunkle or Hamburg school districts to breach their contracts. See Hydrair Inc. v. National Environmental Balancing Bureau, February 2000, no. 2846, op. at 4 (C.R Phila. July 27, 2000) (Herron, J.) (sustaining preliminary objections to tortious interference claim of original complaint). Like the original complaint, the second amended complaint does not allege that the decertification proceedings interfered with the Hamburg and Kunkle jobs or that Hamburg and Kunkle even knew about the decertification proceedings. If Hydrair does claim tortious interference with existing contractual relations against NEBB, PEBA, Carlin Management, Casey, Dolim, Reardon or Salkin, that claim is legally insufficient and insufficiently specific.

      . Reardon objects to the demands for punitive damages in all counts. Since there is no legally sufficient claim against Reardon, the court does not address these objections.

      . Roaten and EAB again object to the defamation claim and the court again overrules their objection.

      . When plaintiffs filed the second amended complaint, former Pa.R.C.P. 1019(h) governed the attachment of writings. That rule, amended effective January 1,2001, is now located at Pa.R.C.P. 1019(i). Since the language quoted is identical in the new and the old versions of the rule, the court cites to the amended version.

      . Reardon also objects on the ground of failure to attach the letter. Because there is no legally sufficient claim against Reardon, the court does not address that objection.


source: Caselaw Access Project

author: PRATT, P.J.,

license: Public Domain

text:
    Fleming Steel Co. v. Boro Developers Inc.

      C.P. of Lawrence County,
    no. 10132 of 1999.

      John W Hodge, for plaintiff.

      Allen L. Palmer, for defendant.
    March 2, 2001
   PRATT, P.J.,

The means by which cases are transferred based on forum non conveniens is provided by Pa.R.C.P. 1006(d)(2), “upon petition of any party.” Defendant Boro Developers Inc. has filed such a petition, a “petition for change of venue pursuant to Pa.R.C.P. 1006—forum non conveniens,” seeking to have the instant case transferred from here in Lawrence County to Montgomery County, Pennsylvania.

After a hearing of the petition, the court makes the following findings of fact:

(1) The plaintiff, Fleming Steel Company, is a corporation located in Lawrence County, Pennsylvania.

(2) The defendant, Boro Developers Inc., is a corporation located in Montgomery County, Pennsylvania.

(3) Lawrence County is in western Pennsylvania and Montgomery County is in southeastern Pennsylvania.

(4) The parties entered into a contract whereby Fleming was to produce very large hangar doors for Boro as part of a larger project Boro was undertaking for Maguire Air Force Base in Wrightstown, New Jersey.

(5) A problem developed concerning operation of the hangar door wheel in its hangar floor track.

(6) The wheel weighs approximately 300 pounds.

(7) Although the hangar door is currently functioning properly, a question remains whether the cause of the problem was the wheel (Fleming’s responsibility) or the tracks (Boro’s responsibility). The original wheel is in Lawrence County, and the replacement wheel is at Maguire Air Force Base in Wrightstown, New Jersey, currently being used on the hangar door.

(8) There is a related question as to whether the replacement wheel functions properly because of the difference between it and the original wheel (Fleming’s responsibility) or a rectifying of the track in the hangar floor (Boro’s responsibility).

(9) The court finds that the ultimate trial judge will very likely order a view of the hangar door at Maguire Air Force Base as well as the wheels in question.

(10) Boro will likely wish to call several U.S. Air Force personnel currently stationed at Maguire Air Force Base as witnesses.

(11) Maguire Air Force Base is located in New Jersey 300 miles from the Lawrence County Court of Common Pleas and 50 miles from the Montgomery County Court of Common Pleas and is beyond the subpoena power of both courts of the witnesses located at the base.

DISCUSSION

The doctrine of forum non conveniens is embodied into our Rules of Civil Procedure as Rule 1006(d)(1):

“For the convenience of the parties and witnesses [,] the court upon petition of any party may transfer an action to the appropriate court of any other county where the action could originally have been brought.” Pa.R.C.P. 1006(d)(1).

The choice of words “may transfer” indicates the matter is one within the discretionary powers of the court. And, indeed, that is true. Radio Corporation of America v. Rotman, 411 Pa. 630, 192 A.2d 655 (1963); Daugherty v. Inland Tugs Co., 240 Pa. Super. 527, 359 A.2d 465 (1976). In fact, the discretion in this area has been termed “great.” Aerospace Finance Leasing Inc. v. New Hampshire Insurance Co., 696 A.2d 810 (Pa. Super. 1997). While plaintiff’s choices of forums are always to be given deference, the court can refuse to exercise its jurisdiction when there are good reasons such as the furtherance of justice or for other public policy objectives. Plum v. Tampax Inc., 402 Pa. 616, 168 A.2d 315 (1961); Taylor v. Taylor, 278 Pa. Super. 339, 420 A.2d 570 (1980). The reasons for transference ought to be weighty and should never deny the plaintiff a forum. Beatrice Foods Co. v. Proctor & Schwartz Inc., 309 Pa. Super. 351, 455 A.2d 646 (1982); Daugherty v. Inland Tugs Co., 240 Pa. Super. 527, 359 A.2d 465 (1976).

Given these findings and our authority under the foregoing law, it will be our holding that the case be transferred to Montgomery County. Only two factors lie in favor of Lawrence County. It is where Fleming is located and filed suit, and it is the location of the original wheel in question. These advantages pale when compared to those of Montgomery County.

Montgomery County is the site of the replacement wheel. It would be more difficult, expensive, and inconvenient to transport the replacement wheel to Lawrence County than to convey the original wheel to Montgomery County. Just as the original wheel may need to be examined for deficiencies, the replacement wheel may need to be examined for contrast. The replacement wheel is still attached and is performing a needed service for our armed forces. Not only would it have to be transported, but it would have to be detached, and the Air Force would need to improvise to compensate for its absence.

The only non-party witnesses mentioned to date are several Air Force personnel stationed at Maguire Air Force Base in New Jersey. Although the witnesses are beyond the subpoena powers of both courts, Maguire is approximately 50 miles from the Montgomery County Courthouse but over 300 miles from the Lawrence County Courthouse.

Finally, there is the matter of a jury view. It seems very likely to us that a jury may need to view the hangar to gain a full perspective of the nature of the situation and the import of the evidence. Additionally, and perhaps more importantly, a view of the scene may be necessary to see if alterations (e.g. jackhammering away old cement and then recementing) were made to the tracks in the hangar floor to accommodate the hangar door wheel.

These seem to be just the sort of considerations to merit such a transfer. Our Pennsylvania Superior Court paraphrasing the United States Supreme Court, has put it thusly:

“Important considerations in this area are the relative ease of access to sources of proof; the availability of compulsory process for the attendance of unwilling witnesses; the cost of obtaining attendance of willing witnesses; the possible need for a view of the premises, if [a] view would be appropriate to the action; and all other practical problems that make [the] trial of a case expeditious and inexpensive.” Norman v. Norfolk and Western Railway Co., 228 Pa. Super. 319, 324-25, 323 A.2d 850, 853 (1974), paraphrasing Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 67 S.Ct. 839, 91 L.Ed. 1055 (1947).

Parenthetically, there is no question that the instant cause of action squarely falls under Pa.R.C.P. 1006(a), thereby authorizing this court to implement Pa. R.C.P. 1006(d)(1), the transferring of this case to Montgomery County, if warranted.

In conclusion, justice, efficiency, and economy dictate this case ought to be transferred to Montgomery County; our appended order makes that more ideal situation a reality.

ORDER

In accordance with the accompanying opinion, the “petition for change of venue pursuant to Pa.R.C.P. 1006—forum non conveniens” of defendant Boro Developers Inc. is granted. Venue of this case is transferred to the Montgomery County Court of Common Pleas under Pa.R.C.P. 1006(d)(1).

Accordingly, the court directs the prothonotary of Lawrence County to so transfer the cause of action pursuant to Pa.R.C.P. 1006(d)(3). All costs and fees of the petition for transfer and removal of the record shall be paid by defendant Boro Developers Inc. and are taxable as costs.


author: ESHELMAN, J.,

text:
    Boyertown Mutual Insurance Co. v. Skias

      C.P. of Berks County,
    no. 1270-95 A.D. 00-8628.

      Fredrick T. Lachat Jr., for plaintiff.

      Peter N. Munsing and Allan C. Molotsky, for defendants Caceres.
    April 2, 2001
   ESHELMAN, J.,

In this action filed under the Declaratory Judgments Act, 42 Pa.C.S. §7531 et seq., we have been asked to decide whether Chris and Shirley Skias individually and/or trading as Chris Skias and/or Chris Skias Weld-Rite Shop and Crane Rentals are insureds under a contract of liability insurance issued by Boyertown Mutual Insurance Company. We have decided that the Skiases and the Chris Skias businesses are insureds under the policy and Boyertown is contractually obligated to provide them with a defense and indemnification in the underlying liability action.

Boyertown issued a special multi-peril policy to Chris Skias and Shirley Skias t/a Weld-Rite Shop for the period effective November 4, 1989 to November 4, 1990. (Stipulation of facts, ¶2.) A review of the complaint in the underlying action reveals the following: Industrial Abrasives a/t/a English Abrasives rented a building from John and Paula Jones located at 642 N. 8th Street, Reading, Pennsylvania. (Complaint, ¶7.) Sometime during the policy period but not otherwise specified in the complaint, Industrial and/or the Joneses made mention to Mr. Skias that they wished to have certain windows at the building boarded up and needed a device that would allow Industrial’s workers to reach the third floor (Complaint, ¶9.) Chris Skias represented that he had such a device, and rented a mobile crane or “cherry picker” to either Industrial or the Joneses, informing them that it was safe for the purpose of elevating persons at least three stories high. (Complaint, ¶10.) On September 21, 1990, Industrial employee Franklin Caceres was positioned in the bucket of the “cherry picker” and elevated to the third story of the building to begin boarding up windows (Complaint, ¶¶5, 11.) While a representative of either Industrial or the Joneses was manipulating the controls of the bucket, the boom of the “cherry picker” suddenly collapsed throwing Mr. Caceres to the street thereby causing him personal injuries. (Complaint, ¶13.) At all relevant times the Skiases owned the “cherry picker” either individually, and/or as Chris Skias Crane Rentals and/or Chris Skias Weld-Rite Shop. (Complaint, ¶14.)

Mr. Caceres and his wife filed the complaint in the underlying action on September 2, 1992. They named as defendants, inter alia, Chris Skias and Shirley Skias and the Chris Skias businesses. Mr. and Mrs. Caceres alleged that the Skiases and/or the Chris Skias businesses were negligent in maintaining and renting the “cherry picker” and knew or should have known the machine was not suitable for safely elevating persons to the third story. (Complaint, counts V-XIII.) By way of letter dated September 17,1992, Boyertown assumed defense of the case. (Brief in support of the motion for summary judgment of defendants Franklin Caceres and Angelita Caceres, exhibit “A.”)

On February 25, 1995, Boyertown filed the within action seeking a declaratory judgment that it is not obligated to provide insurance coverage or legal representation to the Skiases and the Chris Skias businesses in the underlying action. Except for the Skiases and the Chris Skias businesses, all defendants filed answers to the complaint. By way of amended order dated August 31, 2000, summary judgment was entered in favor of Industrial and against all other parties in the within cause of action. The case was called for trial, but by way of order entered December 1, 2000, the court approved a stipulation entered into between Boyertown and Mr. and Mrs. Caceres removing the case from the trial list to allow the parties to file cross-motions for summary judgment. On December 4, 2000, the parties filed a stipulation of facts taking as true the factual allegations in the underlying complaint and agreeing that Boyertown issued the policy to the Skiases t/a Weld-Rite Shop for the period November 4, 1989 to November 4, 1990 and attaching a true and correct copy of the policy. The parties filed their cross-motions on December 12, 2000 and their respective answers to the motions on December 22, 2000. By way of order dated January 22, 2001, the court denied Boyertown’s motion, granted the Cacereses motion and ordered Boyertown to provide a defense and indemnification to the Skiases and the Chris Skias businesses in the underlying action. Boyertown filed an appeal from this order on February 20, 2001. This opinion is filed pursuant to Pa.R.A.P. 1925(a).

Summary judgment is proper where the pleadings, depositions, affidavits and materials of record show that there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. The court views the record in the light most favorable to the opposing party and resolves all doubts and reasonable inferences about the existence of an issue of fact in favor of the non-moving party. Nationwide Insurance Co. v. Horace Mann Insurance Co., 759 A.2d 9, 10 (Pa. Super. 2000). (citations omitted) The court must ignore controverted facts contained in the pleadings and restrict its review to material filed in support of, and in opposition to, a motion for summary judgment and to those allegations in pleadings that are uncontroverted. Overly v. Kass, 382 Pa. Super. 108, 554 A.2d 970 (1989). Summary judgment should not be entered unless the case is clear and free from doubt. Hathi v. Krewstown Park Apartments, 385 Pa. Super. 613, 561 A.2d 1261 (1989). “Generally, the proper construction of a policy of insurance is a matter of law which may properly be resolved by a court pursuant to a motion for summary judgment.” Frain v. Keystone Insurance Company, 433 Pa. Super. 462, 466, 640 A.2d 1352, 1354 (1994).

“Section 7533 of the Judicial Code provides:
‘Section 7533. Construction of documents’
“ ‘Any person interested under a deed, will, written contract, or other writings constituting a contract, or whose rights, status, or other legal relations are affected by a statute, municipal ordinance, contract, or franchise, may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract, or franchise, and obtain a declaration of rights, status, or other legal relations thereunder.’ 42 Pa.C.S. §7533. “ ‘An action for declaratory judgment is available to obtain a declaration of the existing legal rights, duties, or status of the parties where the declaration will aid in the determination of a genuine, justifiable controversy. Fidelity Bank v. Pennsylvania Turnpike Commission, 498 Pa. 80, 88-90, 444 A.2d 1154, 1159 (1982); Nationwide Mutual Insurance Co. v. Cummings, 438 Pa. Super. 586, 590-91 n.5, 652 A.2d 1338, 1340 n.5 (1994), alloc. denied, 540 Pa. 650, 659 A.2d 988 (1995). A declaratory judgment action is particularly appropriate in construing contracts of insurance in order to determine whether an insurer is obligated to defend and/or indemnify one claiming under the policy. Liberty Mutual Insurance Co. v. S.G.S. Co., 456 Pa. 94, 95-99, 318 A.2d 906, 907-908 (1974); 42 Pa.C.S. §7533 (construction of documents). See also, Redevelopment Authority of the City of Philadelphia v. Insurance Company of North America, 450 Pa. Super. 256, 675 A.2d 1256 (1996). The proper construction of an insurance policy is an issue, which may be resolved as a matter of law in a declaratory judgment action. Alexander v. CNA Insurance Co., 441 Pa. Super. 507, 509-11, 657 A.2d 1282, 1284 (1995).’ Redevelopment Authority v. International Insurance Co., [454 Pa. Super. 374] at 383, 685 A.2d [581] at 585-86 [1996] ...
“‘The principles governing the interpretation of insurance contracts are well-settled. Review is directed at ascertaining the intent of the parties as manifested by the written instrument. Where the provision of a policy is ambiguous, the policy provision is construed in favor of the insured and against the insurer, the drafter of the instrument. Where the language of an insurance contract is clear and unambiguous, a court is required to give effect to that language. Standard Venetian Blind Co. v. American Empire Insurance Co., 503 Pa. 300, 305, 469 A.2d 563, 566 (1983). A court may not “rewrite” an insurance contract, or construe clear and unambiguous language to mean other than what it says. Guardian Life Insurance Co. v. Zerance, 505 Pa. 345, 353, 479 A.2d 949, 953 (1984); Patterson v. Reliance Insurance Cos., 332 Pa. Super. 592, 595, 481 A.2d 947, 949 (1984).’ Jeffrey v. Erie Insurance Exchange, 423 Pa. Super. 483, 489, 621 A.2d 635, 638 (1993) (en banc). ‘Where the policy language is clear, the contract will be applied as written.’ Bowers v. Estate of Feathers, 448 Pa. Super. 263, 268, 671 A.2d 696, 697 (1995), quoting Insurance Company of the State of Pennsylvania v. Hampton, 441 Pa. Super. 382, 385, 657 A.2d 976, 977-78 (1995), alloc. denied, 542 Pa. 647, 666 A.2d 1056 (1995). Accord: Alexander v. CNA Insurance Co., 441 Pa. Super. 507, 509-11, 657 A.2d 1282, 1284 (1995), alloc. denied, 543 Pa. 689, 670 A.2d 139 (1995).” Warner v. Continental/CNA Insurance Cos., 455 Pa. Super. 295, 300-304, 688 A.2d 177, 180-82 (1996).

Boyertown points out that the declarations page of the policy denotes “Chris Skias and Shirley Skias t/a Weld-Rite Shop” as the named insureds and no policy was issued to Chris Skias Crane Rentals. Because the underlying action arises from the risks and hazards associated with the crane rental operations of Chris Skias and not the welding operations, Boyertown contends that it has no obligation under the policy to defend or indemnify the Skiases in the underlying action. “Boyer-town Mutual is not denying coverage because the accident in question occurred off premises. The coverage is being denied because the occurrence was totally unrelated to the welding operations insured.” (Memorandum of law in support of plaintiff Boyertown Mutual Insurance Company’s motion for summary judgment, p. 10.) We think this argument begs the question. The central issue in this case is a definitional one: How does the policy define “named insured” and do the Skiases and the Chris Skias businesses come under that definition?

The answer to this question is found at form M.P. 0093 (07/7) “Special multi-peril liability insurance.” Under “persons insured” we find the following definition:

“Each of the following is an insured under this insurance to the extent set forth below:
“(a) if the named insured is designated in the declarations as an individual, the person so designated but only with respect to the conduct of a business of which he is the sole proprietor and the spouse of the named insured with respect to the conduct of such a business ....” (emphasis in original)

The declarations page of the policy names Chris and Shirley Skias t/a Weld-Rite Shop as named insureds. Part 3 of the declarations page designates the named insureds as individuals. The inclusion of the fictitious name “Weld-Rite Shop” in the declarations page does not change the insureds’ status as individuals. The record in this case indicates that both the welding and the crane rental businesses were conducted as proprietorships. (Complaint, ¶4.) No legal entity known as the “Weld-Rite Shop” or “Crane Rentals” existed apart from the Skiases. Waugh v. Steelton Taxicab Co., 371 Pa. 436, 89 A.2d 527 (1952); Jacob’s Air Conditioning & Heating v. Associated Heating & Air Conditioning, 366 Pa. Super. 430, 531 A.2d 494 (1987). See also, Imperial Cas. & Indem. Co. v. High Concrete Structures Inc., 858 F.2d 128 (3d Cir. 1988); Donald R. Ohrum General Construction v. Bumbarger, 16 D.&C.4th 203 (1992). Therefore, any liability the Skiases and the Chris Skias businesses would have in the underlying action would be personal liability.

Under the aforesaid policy definition the individuals Chris Skias and Shirley Skias are named insureds “with respect to the conduct of a business of which he [sic] is the sole proprietor.” Words of common usage in an insurance policy are to be construed in their natural, plain and ordinary sense. Lititz Mutual Insurance Co. v. Steely, 746 A.2d 607 (Pa. Super. 1999). The definition contains the indefinite article “a” not the limiting objective “the.” Therefore it is reasonable to conclude that any business engaged in by the individual insureds as proprietors is insured by the policy. In this case that would include the business of crane rentals. If Boyer-town truly wished to limit coverage to the named business of individual insureds it could have easily done so by drafting a restrictive definition of “insured” or by otherwise changing language in the contract of insurance to explicitly limit coverage to a particular business. Boyertown did neither and has presented nothing to the court that would lead us to conclude that the policy covers only welding operations or excludes crane rental hazards. Alternatively, a comparison of the designation of the named insured on the declarations page, Chris and Shirley Skias t/a Weld-Rite Shop, and the definition of named insured in the policy presents an ambiguity, which is construed against Boyertown and in favor of the insured. Standard Venetian Blind Co., supra; Warner, supra.

Boyertown attempts to bolster its argument by referring the court to two forms which are part of the policy. Boyertown maintains that form MP 9991 (07/77) “General schedule-section II SMP liability insurance” lists welding under “hazards and locations” but not crane rentals and therefore this proves Boyertown only intended to insure risks arising out of welding. However, this form sets forth rating classifications; it is neither a description nor an exclusion of covered risks. This conclusion is supported by language on the form, which reads as follows: “The ratings classifications herein, except as specifically provided elsewhere, do not modify any of the provisions of the policy.” Boyertown also asserts that coverage is limited by form L6432g (7/83) which lists various descriptions of operations including welding but not crane rentals. Boyertown argues that this form lists the risks and hazards which might be insured upon payment of an appropriate premium, and the omission of crane rentals proves that the policy covered only those risks arising put of welding operations. However, we note that language at the top of this form indicates that the description of operations applies only to explosion, collapse and underground property damage hazards, none of which are involved in the underlying action.

It was for the foregoing reasons, therefore, that we denied Boyertown’s motion for summary judgment and granted the Cacereses’ motion and ordered Boyertown to provide a defense and indemnification to the Skiases and the Chris Skias businesses in the underlying action.

      . Pursuant to Pa.R.C.P. 1601(a) the practice and procedure in a declaratory judgment action shall follow, as nearly as may be, the rules governing the action in equity. Pa.R.C.P. 1511(a) provides that, on praecipe of the plaintiff, the prothonary shall enter a judgment of default against a defendant for failure to plead within the required time to a complaint which contains a notice to defend. Pa.R.C.P. 1511(b) provides in pertinent part, that in all cases, the court shall enter an appropriate decree upon the judgment of default and may take testimony to assist in the framing of the decree. In this case, the plaintiff did not praecipe for a default judgment against the Skiases or the Chris Skias businesses. Therefore, the failure of said defendants to answer the complaint played no role in the framing of the order disposing of the cross-motions for summary judgment.


text:
    Albert M. Greenfield & Co. Inc. v. Alderman

      Michael S. Silberman, for plaintiff.

      William T. Hangley, for defendant.
    May 14, 2001
   HERRON, J.,

Defendants, Mark L. Alderman, Esquire, Robert C. Jacobs, Esquire, and Wolf, Block, Shorr & Solis-Cohen, LLP, have filed a motion to disqualify Michael S. Silberman, Esquire and his law firm, Silberman & DiFilippo PC., as counsel for plaintiff, Albert M. Greenfield & Co. Inc. This motion is the latest maneuver in the underlying and complicated litigation, involving allegations of legal malpractice lodged against defendants on account of the unsuccessful purchase and development by plaintiff of three real estate properties from third-party owners. These properties are the Federation Building, the Packard Building and the 1600 Arch Street Building. The present motion concerns 1600 Arch Street and separate lawsuit(s) involving this property, as well as the ultimate settlement reached in those suit(s).

Since it does not appear at this time that Silberman’s representation of Greenfield gives rise to such a direct conflict of interest so as to negate Greenfield’s choice of counsel, and since Silberman may represent Greenfield in pre-trial matters, the court is denying the motion.

BACKGROUND

This memorandum opinion will focus only on those facts concerning the transaction involving 1600 Arch Street, which are at issue in the present motion.

In 1997, Greenfield was the exclusive commercial leasing representative for Quinnco 1600 Arch Street, LLC, who was the owner of the building located at 1600 Arch Street. Quinnco had been a client of Wolf Block on various legal matters. SunAmerica Housing Fund, 431, a Nevada Limited Partnership and affiliate of SunAmerica Affordable Housing Partners allegedly held at least a 50 percent partnership interest in Quinnco.

Initially, Wolf Block had represented Quinnco before Wolf Block became interested in leasing office space in 1600 Arch Street. In pursuit of this interest, by letter dated April 3, 1997, Jeffrey B. Rotwitt, Esq. of Obermeyer, Redmann, Maxwell & Hippell, acting as Wolf Block’s exclusive tenant representative, wrote to Greenfield, in its capacity as Quinnco’s leasing representative, and requested a proposal “to lease space” in 1600 Arch Street on behalf of Wolf Block. On account of the apparent conflict resulting from Wolf Block’s representation of Quinnco, Quinnco retained Blank Rome Comisky & McCauley, LLP for the limited purpose of representing Quinnco in the lease negotiations. In October, 1997, Quinnco and Wolf Block purportedly reached a binding letter of intent for Wolf Block to lease office space in 1600 Arch Street (the lease deal). The lease deal broke down because of Quinnco’s purported breach. As a result, Greenfield and Wolf Block initiated separate lawsuits against Quinnco, both of which eventually settled. Specifically, Greenfield sought payment of the leasing commission of more that $1,200,000, which it allegedly earned from the lease deal and Greenfield also filed a broker’s lien against Quinnco in this amount. Wolf Block, in its lawsuit against Quinnco, sought compensatory damages, costs, attorneys’ fees and other relief.

Wolf Block’s case against Quinnco settled first and Wolf Block received $250,000. However, Greenfield’s suit against Quinnco continued. Plaintiff’s counsel here, Silberman was also Greenfield’s attorney in the Greenfield/Quinnco litigation, wherein Greenfield sought payment of the leasing commission. F. Warren Jacoby, Esq. of Cozen & O’Connor represented Quinnco in that litigation. On June 17, 1999, a settlement discussion allegedly occurred between Michael F. R Maloney, the representative of Quinnco’s general partner, and Albert M. Greenfield III of Greenfield, wherein Maloney purportedly stated that the Greenfield/ Quinnco litigation might be settled if Greenfield made an offer to buy the 1600 Arch Street Building for $8,500,000.

Between June 17, 1999 and July 22, 1999, Mr. Greenfield and Jacobs of Wolf Block had a series of telephone discussions and meetings to determine the economic feasibility of buying the 1600 Arch Street Building from Quinnco for $8,500,000 and, thereafter, convert it from an office building into apartments using historic tax credits. Plaintiff alleges that such a conversion of 1600 Arch Street would be modeled after the “Pennsylvania House Project” in which Wolf Block had represented Greenfield in connection with the conversion from an office building into apartments of the former “Pennsylvania Building” located at 1500 Chestnut Street, Philadelphia Pennsylvania, known as “The Pennsylvania House.” Then, on July 22, 1999, Mr. Greenfield sent a letter to Maloney, extending its offer to buy the 1600 Arch Street Building for $8,500,000. Jacobs of Wolf Block allegedly helped Greenfield prepare this letter, but defendants deny this allegation. On September 2, 1999, Mr. Greenfield sent a letter to Michael L. Fowler, president of SunAmerica, which referred to its offer to buy the 1600 Arch Street Building, along with copies to Dan Keating of Keating Builder Corp. and copies to Alderman and Jacobs of Wolf Block. This letter was sent allegedly at the behest of Jacobs during a telephone conversation with Mr. Greenfield, wherein Jacobs allegedly indicated that Alderman wanted Greenfield to send this letter and purportedly explained that it should also be sent to Keating. Keating, is an existing client of Wolf Block, who is the “contractor” on the conversion of the 1600 Arch Street Building and is or was in the process of becoming an equity participant in the 1600 Arch Street Building along with Quinnco. Jacobs allegedly told Mr. Greenfield that Keating was anxious to “get going” with the conversion; that Keating could help mediate a settlement of the Greenfield/Quinnco litigation; and that he would be willing to be Greenfield’s “contractor” for the building if Greenfield was successful in buying it from Quinnco. Defendants deny that Jacobs made any such statements to Mr. Greenfield.

Thereafter, on October 13, 1999, Jacobs did telephone Mr. Greenfield and stated that Alderman wanted to arrange a meeting to be held on October 14, 1999 at Wolf Block’s offices among Mr. Greenfield, Alderman, Jacobs and Keating with the purported purpose of mediating a settlement of the Greenfield/Quinnco litigation. On that same date, Mr. Greenfield wrote Keating, and included a copy of a letter to F. Warren Jacoby from Silberman, relating to a proposed settlement of the Greenfield/Quinnco litigation. Greenfield also wrote to Michael F. Fowler of SunAmerica and indicated that “this litigation ought to be settled in the manner set forth in my lawyer’s [Silberman’s] letter or, alternatively, I am willing to settle by purchasing the building for $8,000,000.”

The October 14,1999 meeting did take place and was attended by Mr. Greenfield, Alderman, Jacobs and Norman M. Goldberger, Esq. of Wolf Block, as well as Keating. Silberman was not present at this meeting even though he did represent Greenfield in the litigation. At the meeting, Alderman, who defendants describe as a “disinterested mediator,” recommended to Mr. Greenfield that he accept an offer by Quinnco (allegedly transmitted by Keating) of $250,000 to settle the Greenfield/Quinnco litigation. Alderman also purportedly told Greenfield that Quinnco was not interested in selling him the 1600 Arch Street Building. Plaintiff alleges that Alderman pressured Mr. Greenfield by opining in a “menacing tone” (i) that Greenfield’s claims were not worth more than $250,000; (ii) that Wolf Block had settled its own claims for $250,000 and (iii) that Greenfield’s lawyer (in the Greenfield/ Quinnco litigation) was an “idiot” and that Mr. Greenfield should listen to Alderman who was really Greenfield’s lawyer and was looking out for Greenfield’s best interests. Defendants admit that Alderman expressed his opinion that Greenfield’s claims were not worth more than $250,000, the same amount which Wolf Block had settled its claims, and that he believed it was in Greenfield’s best interest to settle for that amount. However, defendants deny that Alderman said anything in a “menacing tone” or said that Greenfield’s lawyer in the Greenfield/Quinnco litigation was an “idiot” or that he, Alderman, was Greenfield’s lawyer and was looking out for Greenfield’s best interests. Mr. Greenfield allegedly responded that he did not care what Alderman thought and the two purportedly “squared off’ and almost came to blows. The meeting did continue and the Greenfield/Quinnco litigation was tentatively settled for $525,000, contingent on SunAmerica’s approval, and was later reduced to $515,000. Ironically, the letter of October 13, 1999 from Silberman to F. Warren Jacoby did propose that “Quinnco/SunAmerica consider a settlement in the amount proposed herein, namely $525,000.”

In the present action, Greenfield alleges that Wolf Block and, in particular, Alderman purported to act as Greenfield’s legal representative at the October 14, 1999 meeting, and that Jacobs and/or Alderman failed to disclose the true nature of Keating’s interest in becoming an equity partner in Quinnco and that they really represented Keating’s interests in the settlement of the Greenfield/Quinnco litigation. The gravamen of its complaint against Wolf Block, in connection with the 1600 Arch Street Building, is that Wolf Block imposed the “cash” settlement with Quinnco upon Greenfield and thwarted Greenfield’s ability to acquire the building as part of its settlement by mooting the “buy/ sell” alternative. As such, Greenfield’s complaint sets forth counts for breach of fiduciary duty, legal malpractice, intentional interference with prospective contractual relations, fraudulent misrepresentation and non-disclosure, and breach of contract.

Defendants deny that they were Greenfield’s legal representative during the 1600 Arch Street transaction (or the other 2 unsuccessful transactions); they deny that Alderman or Wolf Block represented Keating during the settlement of the Greenfield/Quinnco litigation; and they deny that they failed to disclose to Greenfield that Keating was about to obtain an equity interest in the 1600 Arch Street Building. However, defendants do admit that Wolf Block had connections to all of the participants in the 1600 Arch Street transaction. Specifically, defendants do admit that Wolf Block had both represented Greenfield and been across the table from Greenfield; that Wolf Block had both represented and litigated against Quinnco and SunAmerica; that Wolf Block hoped to be engaged to represent the 1600 Arch Street venture as the project proceeded; and that Wolf Block had an attorney-client relationship with Keating

Clearly, many facts remain in dispute. However, this court need not decide these facts in order to resolve the present motion to disqualify plaintiff’s counsel. Rather, this court’s inquiry is limited to whether Silberman and his law firm are conflicted by their own interests or whether Silberman is a necessary witness in this matter who must be disqualified at this point in the litigation.

DISCUSSION

In their motion to disqualify Silberman and his law firm as counsel for plaintiff, defendants assert two grounds: (1) that Silberman’s representation of Greenfield would be violative of Rule 1.7(b) of the Pennsylvania Rules of Professional Conduct since Silberman’s representation of Greenfield is materially limited in protecting his own interests since he was involved in the Quinnco settlement and may himself be liable for malpractice; and (2) that Silberman is precluded under Rule 3.7 of the Pennsylvania Rules of Professional Conduct from representing Greenfield since Silberman is a necessary witness at trial as his participation and advice to Greenfield in the Quinnco settlement will be crucial to Wolf Block’s defense.

Contrary to defendants’ position, this court finds no compelling reason at this juncture in the litigation to disqualify Silberman or his law firm based on a conflict of interest. Additionally, even if Silberman may likely be shown to be a necessary and material witness, whose testimony cannot be obtained elsewhere, Silberman may still act as Greenfield’s attorney in pre-trial matters. Therefore, Greenfield should not now be denied his choice of counsel.

I. Standard for Reviewing Motion To Disqualify Counsel

Our Supreme Court has repeatedly stated that “[t]he trial court in the first instance has the power to regulate the conduct of attorneys practicing before it, and has the duty to insure that those attorneys act in accordance with the Code of Professional Responsibility.” American Dredging Co. v. City of Philadelphia, 480 Pa. 177, 183, 389 A.2d 568, 571 (1978). See also, Slater v. Rimar Inc., 462 Pa. 138, 150, 338 A.2d 584, 589 (1975); Seifert v. Dumatic Industries Inc., 413 Pa. 395, 397, 197 A.2d 454, 455 (1964); Estate of Younger, 314 Pa. Super. 480, 492, 461 A.2d 259, 264 (1983). Currently, “[a]n attorney’s conduct concerning the representation of his client is governed by the Pennsylvania Rules of Professional Conduct.” In re Birmingham Twp., Delaware County, 142 Pa. Commw. 317, 322, 597 A.2d 253, 255 (1991). “A court may restrain conduct which it feels may develop into a breach of ethics; it ‘is not bound to sit back and wait for a probability to ripen into a certainty.’ ” Maritrans GP Inc. v. Pepper, Hamilton & Scheetz, 529 Pa. 241, 255, 602 A.2d 1277, 1284 (1992) (quoting United States v. RMI Co., 467 F. Supp. 915, 923 (W.D. Pa. 1979).

The common law holds that an attorney owes a fiduciary duty to his client which demands undivided loyalty and prohibits the attorney from engaging in conflicts of interest. Maritrans, 529 Pa. at 253, 602 A.2d at 1283. An attorney may not represent conflicting interests, unless those interests agree to be so represented. Seifert, 413 Pa. at 397, 197 A.2d at 455. See also, Commonwealth ex rel. Whitling v. Russell, 406 Pa. 45, 48-49, 176 A.2d 641, 643 (1962). “The test of whether an attorney has a conflicting interest so as to preclude his representation of a party is not the actuality of conflict, but the possibility that a conflict may arise.” Middleberg v. Middleberg, 427 Pa. 114, 115, 233 A.2d 889, 890 (1967) (quoted in Estate of Pew, 440 Pa. Super. 195, 243, 655 A.2d 521, 545 (1994)).

Granting a motion to disqualify and removing the offending lawyer is the usual remedy employed when a breach of ethics is made to appear. Slater, 462 Pa. at 149, 338 A.2d at 589. In the same instance, disqualification is “a serious remedy which must be imposed with an awareness of the interests of a client in representation by counsel of the client’s choice.” Id. at 149-50, 338 A.2d at 590. Accord McCarthy v. SEPTA, 2001 WL 347147 at *3 (Pa. Super. Apr. 10, 2001). See also, George v. Wausau Insurance Co., 2000 WL 276915 at *1 (E.D. Pa. Mar. 13, 2000) (noting that motions to disqualify are not favored since a party’s choice of counsel is entitled to substantial deference) (citing Hamilton v. Merrill Lynch, 645 F. Supp. 60, 61 (E.D. Pa. 1986). Further, violation of the ethical rules does not necessarily provide grounds for disqualification. See Maritrans, 529 Pa. at 256, 602 A.2d at 1284. Rather, a court may disqualify counsel if it is necessary “to ensure the parties receive the fair trial which due process requires.” McCarthy, 2001 WL 347147 at *3 (quoting In re Estate of Pedrick, 505 Pa. 530, 542, 482 A.2d 215, 221 (1984)). In addition, the court should prevent litigants from using motion to disqualify opposing counsel for tactical purposes. Hamilton, 645 F. Supp. at 61.

Applying this standard to the present case, this court does not now find that Silberman must be disqualified from representing Greenfield or that defendants will be deprived their due process rights if Silberman is allowed to continue representing Greenfield.

II. Silberman’s Representation of Greenfield Does Not Appear To Be Materially Limited by His Own Interests Because of His Participation in the Settlement of the Greenfield/Quinnco Litigation

Defendants argue that Silberman’s involvement in the Greenfield/Quinnco litigation gives rise to serious questions concerning his professional propriety in that transaction and that “no reasonable attorney could believe that his representation of Greenfield would not be adversely affected.” Defs. mem. of law, at 12. Specifically, defendants contend that Silberman was responsible for the “purportedly less favored” money settlement alternative in that litigation, while Wolf Block was purportedly responsible for the favored “buy/sell” settlement alternative which, thus, gives rise to various questions regarding Silberman’s knowledge and participation in the ultimate settlement which resulted. Defs. reply br., at 1-3.

In response, plaintiff asserts that defendants’ motion is merely brought for tactical purposes since “Silberman did not participate in and does not (and could not) have any firsthand knowledge of the events giving rise to Greenfield’s claim against defendants involving 1600 Arch Street.” PI. mem. of law, at 18-19. Plaintiff also argues that “Silberman was undeniably ‘out of the loop’ and could not have been (as defendants claim) immersed in ... the settlement discussions relating to Greenfield’s efforts to acquire 1600 Arch Street or, for that matter, the cash settlement forged by Alderman and Jacobs at the October 14, 1999 meeting.” PI. sur-reply br., at 7.

Rule 1.7(b) of the Rules of Professional Conduct is relevant to this dispute and provides in pertinent part:

“A lawyer shall not represent a client if the representation of that client may be materially limited by the lawyer’s responsibilities to another client or to a third person, or by the lawyer’s own interests, unless:
“(1) the lawyer reasonably believes the representation will not be adversely affected; and
“(2) the client consents after full disclosure and consultation. . . .” Id. (emphasis added)

With respect to whether a client may waive a conflict, the comment to Rule 1.7 explains as follows:

“[A]s indicated in... paragraph (b)(1) with respect to material limitations on representation of a client, when a disinterested lawyer would conclude that the client should not agree to the representation under the circumstances, the lawyer involved cannot properly ask for such agreement or provide representation on the basis of the client’s consent.” Id.

Additionally, in regards to a conflict presented by the lawyer’s own interests, the comment to Rule 1.7 also relates that:

“The lawyer’s own interests should not be permitted to have adverse effect on representation of a client. . . . If the probity of a lawyer’s own conduct in a transaction is in serious question, it may be difficult or impossible for the lawyer to give a client detached advice. . ..” Id.

Moreover, the mere existence of potential claims against the attorney does not automatically disqualify that attorney under Rule 1.7(b). Lease v. Rubacky, 987 F. Supp. 406, 408 (E.D. Pa. 1997). Rather, the question is whether the existence of potential claims so affects the adequacy of representation as to mandate disqualification because the lawyer or law firm is unlikely to advise the client to pursue such claims. Id. See also, J & J Snack Foods Corp. v. Kaffrissen, 2000 WL 562736 at *3-4 (E.D. Pa. May 9, 2000) (holding that decedent’s wife’s potential claims against attorney creates directly adverse interests that affect the adequacy of representation in present action where wife and attorney are both co-defendants). Nonetheless, where potential claims are speculative and not likely to be pursued, full and adequate representation may not be impaired. See Hamilton, 645 F. Supp. at 61-62.

Applying these principles to the present case, it seems clear that a reasonable attorney could conclude that Silberman’s representation of Greenfield in this matter would not be so adversely affected as to negate Greenfield’s clear choice of counsel. It is true that Silberman did extend an offer of $525,000 for settlement of the Greenfield/Quinnco litigation. See compl., exhibit P. It is also true that Silberman was present at the settlement discussion on June 17, 1999 which occurred between Maloney and Greenfield and where the sale of 1600 Arch Street for $8,500,000 in exchange for settling the Greenfield/Quinnco litigation, was first mentioned. PI. sur-reply br., at 2. However, it is undisputed that Silberman was absent from the October 14, 1999 meeting which appears to be the pivotal event giving rise to Greenfield’s claim against defendants in regards to 1600 Arch Street. Plaintiff also disputes that Silberman was involved with preparing the offer to purchase 1600 Arch Street for $8,500,000 or many of the circumstances involving this “buy/sell” alternative.

Under the circumstances, it does not appear at this time that Silberman’s representation of Greenfield in this matter gives rise to such a direct conflict of interest under Rule 1.7(b) as to affect the adequacy of his representation of Greenfield.

TIT. Silberman Need Not Be Disqualified at This Stage of the Litigation Pursuant to Rule 3.7 of the Pennsylvania Rules of Professional Conduct Even if He Is Ultimately Shown To Be a Material and Necessary Witness at Trial

Defendants also argue that Silberman must be disqualified from appearing as trial counsel in this case because he is a necessary witness at trial and will be called by the defendants. Specifically, defendants assert that Silberman’s participation and advice to Greenfield with respect to the Greenfield/Quinnco settlement will be crucial to the defense since Greenfield’s ultimate settlement with Quinnco for $525,000 was accomplished (1) with Greenfield knowing that Quinnco would not agree to sell him 1600 Arch Street; (2) with Greenfield knowing all material facts concerning the relationships between Keating, Wolf Block and Quinnco; and (3) upon the advice of Silberman. Defs. mem. of law, at 15. For these reasons, defendants contend that “Silberman is likely to be the only witness who can testify to many of the facts bearing on the settlement between Greenfield and Quinnco” and his testimony is likely to be adverse to Greenfield. Id. at 15-16.

Plaintiff, in turn, argues that Silberman can only testify to the substance of the telephone call made by Jacobs to Silberman on the afternoon of October 14, 1999 regarding an additional contingency to the settlement of the Greenfield/Quinnco litigation; i.e., that Wolf Block was to get a commitment of business from SunAmerica in order for the settlement to take place. PI. mem. of law, at 20 n.26. Plaintiff also asserts that Jacobs, on that same day and prior to his telephone call to Silberman, had telephoned Mr. Greenfield and related the same matter to Mr. Greenfield regarding the contingency. Id. See also, compl. at ¶¶70-71. Defendants, in essence, have admitted that Jacobs telephoned both Greenfield and Silberman on the afternoon of October 14, 1999, but they deny that Jacobs added any contingency to the settlement. See defendants’ proposed amended answers to the complaint at ¶¶70-71, attached to pi. mem. of law, at exhibit A. Rather, defendants assert that “Greenfield, Quinnco, and Wolf Block all were already aware that Wolf Block was contributing to the settlement, and that its contribution was contingent upon the firm getting business from SunAmerica.” Id. Under these circumstances, plaintiff contends that Silberman’s testimony would be cumulative.

Though Silberman might ultimately be shown to be a material and necessary witness at trial, from whom critical evidence may not be obtained elsewhere, Silberman need not be disqualified at this stage of the litigation.

Pennsylvania has adopted the advocate-witness rule provided by Rule 3.7 of the Pennsylvania Rules of Professional Conduct, which states as follows:

“(a) A lawyer shall not act as advocate at a trial in which the lawyer is likely to be a necessary witness except where:
“(1) the testimony relates to an uncontested issue;
“(2) the testimony relates to the nature and value of legal services rendered in the case; or
“(3) disqualification of the lawyer would work substantial hardship on the client.” Id. See also, Commonwealth v. Gibson, 448 Pa. Super. 63, 70, 670 A.2d 680, 683 (1996) (“appearance of an attorney as both advocate and witness at trial is considered highly indecent and unprofessional conduct to be avoided by counsel and to be strongly discountenanced by colleagues and the courts”). The advocate-witness rule serves to protect the interests of the parties since “[c]ombining the roles of advocate and witness can prejudice the opposing party and can involve a conflict of interest between the lawyer and client.” Pa. R.P.C. 3.7 cmt. Additionally, the comment to Rule 3.7 explains the following:
“The opposing party has proper objection where the combination of roles may prejudice that party’s rights in the litigation. A witness is required to testify on the basis of personal knowledge, while an advocate is expected to explain and comment on evidence given by others. It may not be clear whether a statement by an advocate-witness should be taken as proof or as an analysis of the proof.. . .” Id. See also, Eric G. Luna, Avoiding a “Carnival Atmosphere”: Trial Court Discretion and the Witness-Advocate Rule, 18 Whittier L.Rev. 447, 451 (1997) (explaining that the rule is designed to protect the legal process itself and preserve the distinction between advocacy and evidence). However even assuming that counsel is likely to be a necessary witness at trial, the consensus in Pennsylvania is that counsel may still represent a client in the pre-trial stage. Golomb & Honik P. C. v. Tareq Ajaj, November 2000, no. 425, slip op. at 5 n.6 (C.P. Phila. Apr. 5, 2001) (Herron, J.) (discussing Pennsylvania authority for this proposition). See also, Schwartz v. Industrial Valley Title Insurance Co., 1997 WL 330366 at *6 (E.D. Pa. June 5, 1997)) (“[Counsel] would not be disqualified as [plaintiff’s] counsel solely because he might be a prospective witness unless that prospect would become likely rather than merely possible.”).

To establish that an attorney will be a “necessary” witness, it must be shown that “the proposed testimony is relevant material and unobtainable elsewhere.” ABA Ann. Model R.P.C. 3.7 cmt., at 9. See also, United Food and Commercial Workers v. Darwin Lynch, 781 F. Supp. 1067, 1069-70 (M.D. Pa. 1991). This issue of “necessity” was deftly addressed by the trial court in Kehrer v. Nationwide Insurance Co., 21 D.&C.4th 385 (C.P. Lancaster Cty. 1994) (Farina, L), which involved allegations of bad faith in failing to settle plaintiffs’ underinsured motorist claim. In that case, the trial court determined that plaintiff’s counsel need not be disqualified pursuant to Rule 3.7 since defendants failed to show (1) that evidence on the contested issue of bad faith was not available from any other witness and (2) that counsel’s proposed testimony would prejudice plaintiffs or further the interests of the defense. 1994 WL 805877 at *5. The court explained that “the term ‘necessary’ means no other witness could testify, and precludes disqualification if the lawyer’s testimony would be merely cumulative.” Id. at *3. (citations omitted) The court also related that the mere fact that defense counsel would likely call plaintiff’s counsel in its case in chief is not sufficient to have opposing counsel disqualified. Id. at *4. The court stated as follows:

“To hold otherwise would encourage abuse of the advocate-witness rule for tactical reasons. If disqualification motions were routinely granted in such situations, the temptation to remove opposing counsel from the litigation would be great.” Id. The three-part test for disqualifying an attorney based on the advocate-witness rule is as follows: (1) it must be shown that the attorney will give material evidence to the determination of the issues being litigated; (2) the evidence cannot be obtained elsewhere and (3) the testimony is prejudicial or may be potentially prejudicial to the testifying attorney’s client. Id. (quoting Smithson v. United States Fidelity & Guaranty Co., 411 S.E.2d 850, 856 (W.Va. 1991)).

Here, it is unclear that Silberman’s proposed testimony is evidence that cannot be obtained elsewhere or that his proposed testimony is material. This determination awaits the eve of trial. It is undisputed that Silberman represented Greenfield in the Greenfield/ Quinnco litigation and that Silberman had extended an offer to settle the matter for $525,000. It is also undisputed that Silberman was not present at the October 14, 1999 meeting, which took place at Wolf Block’s offices, and which gives rise to plaintiff’s claim against defendants with regards to 1600 Arch Street. What remains in dispute is whether Alderman and/or Jacobs of Wolf Block purported to give legal advice to Greenfield and act as its representative during that meeting. Further, the parties dispute whether Jacobs added a contingency to the settlement of the Greenfield/Quinnco litigation. Nonetheless, there appears to be no prohibition against Mr. Greenfield giving testimony on this issue and Wolf Block is not prevented from putting on its own witnesses to refute plaintiff’s evidence. Any testimony that Silberman may give in this regard could well be material at the time of trial.

Nonetheless, this court need not disqualify Silberman at this juncture and Silberman may still represent Greenfield in all pre-trial matters.

CONCLUSION

For the reasons set forth above, this court is entering a contemporaneous order denying defendants’ motion to disqualify Silberman and his law firm as plaintiff’s counsel without prejudice to refile at a time closer to the trial date in the event that defendants are able to establish that Silberman’s disqualification is then appropriate.

ORDER

And now, May 14, 2001, upon consideration of the defendants’ motion to disqualify plaintiff’s counsel, Michael S. Silberman, Esquire and Silberman and DiFillippo P.C., plaintiff’s response in opposition thereto, all respective memoranda and all other matters of record and in accordance with the memorandum opinion being filed contemporaneously with this order, it is hereby ordered and decreed that the motion is denied without prejudice.

      . The facts presented in this section are those gleaned from the relevant pleadings, transcripts and memoranda of the parties. The parties disagree on many of the facts and this opinion merely recites them for purposes of background and for disposing of the present motion.

      . Transcript of December 15,2000 at 57; pi. mem. of law in opposition to defs. motion to disqualify, at 7.

      . TR at 58,62; pi. mem. of law, at 7.

      . Compl. a^52.

      . TR at 57-58,62.

      . PL mem. of law, at 8.

      . TR at 58,62; pi. mem. of law, at 8.

      . PI. mem. of law, at 8.

      . TR at 58,62; pi. mem. of law, at 8.

      . The captions of these respective lawsuits are Albert M. Greenfield & Co. v. Quinnco—1600 Arch Street, C.P. Phila. April term 1998, no. 3219 (Greenfield/Quinnco litigation); and Abrahams v. Quinnco—1600 Arch Street, May term 1998, no. 648 (Wolf Block litigation).

      . Compl. at^[51;pl. mem. of law, at 9.

      . Id.

      . TR at 60; pi. mem. of law, at 9.

      . Compl. and answer, at ¶53; TR at 63. According to Greenfield, partners of Wolf Block (including Alderman) were material witnesses in the Greenfield/Quinnco litigation. Id. Both parties admit that Wolf Block did not represent Greenfield in that litigation. Id.

      . TR at 64.

      . TR at 64-65; compl. a^[55.

      . Compl. and answer at J[56.

      . Compl. and answer at|6.

      . Compl. at‘J[59. See Compl., exhibitN.

      . Compl. and answer atf59.

      . Compl. and answer at^62. See compl., exhibit O.

      . Compl. and answer at(fj[60-61.

      . TR at 59,68-69.

      . Compl. atf61.

      . Answer atfl[60-61.

      . Compl. and answer at ¶63. Both parties disagree as to whether Alderman requested the meeting or if Greenfield requested the meeting and on what date Jacobs telephoned Mr. Greenfield (see id; TR at 59), but this disagreement need not be resolved in order to rule on the present motion.

      . Compl. and answer atf64. See compl., exhibitR

      . Compl. a^65. See compl., exhibit Q.

      . Compl. and answer atf66.

      . TR at 71. See also, defs. mem. of law in support of their motion to disqualify plaintiff’s counsel, at 5.

      . Answer at ¶67.

      . Compl. and answer at ¶67; TR at 60,70.

      . Compl. and answer at ¶67; TR at 70.

      . Compl. a1^68; TR at70.

      . Answer at^68.

      . Id.

      . Compl. and answer a1^69.

        .Id.

      . Compl., exhibit P. The same letter is attached at exhibit A to defs. mem. of law in support of their motion to disqualify.

      . Compl. atf|[74-75.

      . Answer atH74-75.

      . Defs. mem. of law, at 4.

      . Id. at 4-5.

      . The United States District Court for the Eastern District of Pennsylvania has incorporated the rules of professional conduct adopted by the Pennsylvania Supreme Court. See George, 2000 WL 276915 at *1 (citing U.S.D.C., E.D. Pa., Local R.C.P. 14(IV)(B)). Currently, this rale is cited as U.S.D.C., E.D. Pa., Local R.C.P. 83.6(IV)(B). Therefore, district court opinions dealing with motions to disqualify opposing counsel are valid as persuasive authority.

      . See Davisair Inc. v. Butler Air Inc., 40 D.&C.4th 403, 406 (C.P. Allegheny Cty. 1998) (Wettick, J.) (“[t]here is no prohibition against [an attorney-witness] providing representation prior to the trial.”). Pennsylvania and Philadelphia Bar Association ethics opinions agree with this assessment. See Pa. Bar Ass’n Comm, on Leg. Eth. & Prof. Resp. inf op. no. 96-15 (1996), at 1 (“there is no... bar to an attorney witness acting as an advocate in pre-trial proceedings”); Pa. Bar Ass’n Comm. on Leg. Eth & Prof. Resp. inf op. no. 94-153, at 2 (1994) (“[t]he key words in Rule 3.7] are ‘act as advocate at a trial.’ Accordingly the proscription is only with reference to ‘a trial’ ”); Pa. Bar Ass’n Comm, on Leg. Eth. & Prof. Resp. inf. op. no. 92-150, at 2 (1992) (“insofar as the nature of your legal representation involves negotiation and trial preparation work, as opposed to the actual representation of the corporation in a trial, the rule would not prohibit you . . . from representing the corporation”); Phila. Bar Ass’n Prof. Guid. Comm. guid. req. no. 88-35, at 1 (1988) (“it is premature to require your withdrawal during pre-trial proceedings because Rule 3.7 only precludes a lawyer-witness from acting as counsel at trial”).