author: LEVIN, J.,

text:
    Alston v. Commonwealth

      December 13, 2010

      Dennis A. Pomo, for plaintiff.

      Janet S. Selden, for defendant PennDOT.

      Suzanne Reilly, for defendant city of Philadelphia.

      Thomas W. Harrity, for defendant Cook.
   LEVIN, J.,

Plaintiff, Kira Alston, brought this action against the defendants, Commonwealth of Pennsylvania and Pennsylvania Department of Transportation (“PennDOT”); the city of Philadelphia (“the city”), and Lawrence Cook (“Mr. Cook,” a property owner), to recover damages stemming from a slip and fall accident that occurred on June 1, 2005, in the vicinity of 5210 Baltimore Avenue, in the city of Philadelphia, near the juncture of a curbside handicap ramp and a sidewalk.

The claims against the city of Philadelphia and PennDOT were resolved by agreement. The releases signed by the plaintiff, Kira Alston, satisfied all of her claims against all of the defendants including Lawrence Cook. The Commonwealth of Pennsylvania did not pursue any cross-claims; however, the city of Philadelphia chose to try its cross-claim against Mr. Cook. Because the city of Philadelphia was only secondarily liable, it proved necessary for the city to try to establish the property owner, Mr. Cook’s responsibility to Kira Alston. The city’s attempt was to be compensated for the amount they paid to resolve the plaintiff, Kira Alston’s claim by seeking to establish the property owner’s liability, and then seeking payment from the property owner. The Commonwealth of Pennsylvania did not join in this process.

A jury trial was commenced on July 7, 2010, before the Honorable Stephen E. Levin, in the Court of Common Pleas of Philadelphia County, on the remaining cross-claim.

On July 12, 2010, at the conclusion of plaintiff’s case in chief, upon a motion for non-suit filed by defendant Cook, the court entered a compulsory non-suit in favor of defendant, Lawrence Cook, and against the city of Philadelphia on its cross claim. The court found, based on the evidence presented, including photographs of the handicap ramp and sidewalk, direct testimony, and expert testimony, that the alleged defect in the sidewalk was trivial under the circumstances. The alleged defect was approximately 5/8 of an inch in depth, at most, as conceded by all parties and their experts, and as demonstrated by direct evidence, including photographs by plaintiff and defense.

On July 19, 2010, the city of Philadelphia filed a post-trial motion for judgment n.o.v. in which it argued that the defect was sufficient in size for a jury to find negligence on behalf of co-defendant Cook. Defendant Cook filed an answer in opposition to the city’s post trial motion in which he cited well-settled case law holding that minor defects in pavement do not engender liability.

On October 12, 2010, the Honorable Stephen E. Levin denied the city of Philadelphia’s motion for post trial relief by an order which stated in pertinent part:

...this court is bound, as a matter of law, to hold there is no negligence where the alleged defect, which here was 5/8ths of an inch, is determined to be trivial under the circumstances presented. The maintenance of sidewalks in a reasonably safe condition under the circumstances is all that is required of a property owner.

On October 29, 2010, defendant, Lawrence Cook, filed a praecipe to enter judgment in his favor, and against the city, with respect to its cross-claim.

Subsequently, on November 10, 2010, defendant, city of Philadelphia filed a timely notice of appeal seeking appellate review of this court’s order denying the city’s post-trial motion, and upholding compulsory non-suit.

For the following reasons, this court’s compulsory non-suit and order denying the city’s post trial motion should be affirmed.

I. BACKGROUND

On June 5, 2005, at approximately 8:45 p.m. in the evening, plaintiff Kira Alston was walking in the vicinity of the northwest comer of 5200 Baltimore Avenue. The street lighting was dim. Ms. Alston was familiar with the area because her uncle and cousin lived around the comer. She visited them about twice a week. She had walked on the same comer many times before. On the evening in question, Ms. Alston testified that she and her cousin, Juanita Keno, had gone on foot to get food at a Chinese Store and at Crown Chicken on Baltimore Avenue across the street. They were returning from these errands when the accident occurred.

Ms. Alston crossed the street with her cousin and walked up the handicap ramp that PennDOT had installed as a cutout into the curb and sidewalk on the comer of 52nd Street and Baltimore. Ms. Alston testified that as she walked up the pavement handicap ramp, the toes of her foot went into a crack that was at the portion of the ramp adjoining the sidewalk. She fell to her knees, then twisted to her side, and ended up falling on her back. She did not see the crack until she was laying on her back with her head out toward the street.

Ms. Alston felt a combination of numbness and pain. She was taken by ambulance to Misercordia Hospital. Later she was transported to the University of Pennsylvania Hospital where she underwent surgery placing pins in her leg to stabilize a fracture. In addition a metal rod was placed in her leg. The surgery was complicated by infection. Finally, she underwent rehabilitation at Manor Care Nursing Home, however, she now had a condition of drop foot. There was further surgery to shorten the tendon. A series of braces were placed on her leg to try to straighten it. For medium to long distances Ms. Alston requires a wheelchair. For very short distances she can use a walker.

There is no question that Ms. Alston was severely injured. The city of Philadelphia and PennDOT chose to settle their claims rather than risk a jury verdict, obtaining general releases signed by the plaintiff, Kira Alston, which satisfied all of her claims against all of the defendants. The city of Philadelphia’s cross claim was asserted based on its position that that the property owner had the primary responsibility to keep the sidewalk in repair, and that the municipality had only secondary liability, based on the Political Subdivision Torts Claims Act, 42 Pa. C.S. Section 8542 (b)(7). For the city to prevail on its cross claim against Mr. Cook, it had to step into the shoes of the original plaintiff, Kira Alston, and to prove her claim against Lawrence Cook. For its part, PennDOT chose not to pursue its potential cross claim. Thus, the question raised by this case was simply whether the defect in the pavement was large enough in size to give rise to liability under the circumstances, or whether the defect was so small as to not implicate the liability of the property owner.

II. DISCUSSION

A) Standard of Review

In the case subjudice, the trial court determined that a cause of action was not established because of the minimal nature of the defect. In Wu v. Spence, M.D., 605 A.2d 395, (Pa. Super. 1992), the Superior Court enunciated the standard of review for compulsory non-suit as follows.

The standard of review on the appeal of a denial of a motion to remove a nonsuit is well settled. The plaintiff must be allowed the benefit of all favorable evidence and reasonable inferences arising therefrom, and any conflicts in the evidence must be resolved in favor of plaintiff. Coatesville Contractors v. Borough of Ridley, 509 Pa. 553, 558-60, 506 A.2d, 862, 865 (1986). Further, “it has been long settled that a compulsory non-suit can only be granted in cases where it is clear that a cause of action has not been established.” Id. “However, where it is clear a cause of action has not been established, a compulsory non-suit is proper.” Toth v. Economy Office Forms Corp., 391 Pa. Super. 383, 386-88, 571 A.2d 420, 422 (1990). “We must, therefore, review the evidence to determine whether the order entering judgment of compulsory nonsuit was proper. Coatesville, 509 Pa. at 559-60, 506 A.2d at 865. With this as our standard of review, we have reviewed the record in this matter, and find that it is clear no cause of action was established, and therefore, the trial court properly granted the nonsuit.

Likewise, in this case, where the un-contradicted evidence showed that the alleged defect was no more than 5/8”, a compulsory nonsuit was mandatory under the circumstances based on the well settled caselaw of the Commonwealth as discussed more fully below. Further, it is important to note that in this case the plaintiff is not the appellant, rather, the city of Philadelphia is appealing the entry of non-suit which had the effect of extinguishing its cross-claim against defendant Cook.

B) This Court Properly Entered Compulsory Non-Suit Based on the Trivial Nature of the Pavement Defect

The question presented on appeal is whether a mere 5/8ths of an inch defect in the pavement at the juncture of a handicap ramp installed by PennDOT leading into the level sidewalk adjacent to defendant Cook’s property is a trivial defect by law.

No definite rule can be laid down as to the depth or size of a sidewalk depression to determine whether the defect is trivial as a matter of law. See Breskin v. 535 5th Ave, 381 Pa. 461, 463, 113 A.2d 316, 318(Pa. 1955).

Nonetheless there are a plethora of prior appellate decisions where sidewalk depressions greater in depth and size than the one at issue were found to provide no basis for liability as a matter of law. See Dudley v. Feldman and Philadelphia Gas, 31 Phila. 408, 1996 Phila Cty. Rptr.; 30 Pa. D. & C. 4th 97, citing Bosack v. Pittsburgh Railways Co., 410 Pa. 558, 583, 189 A.2d 877, 880 (1963), which discussed adjoining cobblestones with 1 1/2” vertical separation; Harrison v. Pittsburgh, 353 Pa. 22, 44 A.2d 273 (1945), discussing a manhole cover projecting 2” above the sidewalk; Magennis v. Pittsburgh, 352 Pa. 147, 150, 42 A.2d 449, 450 (1945), involving a 1 1/2” depression that was 12” by 15”; Foster v. West View Borough, et al. 195 A. 82 (Pa. 1937), where there was a depressed unpaved area adjacent to the sidewalk which was 2 feet long and 2-4 inches below the level of the sidewalk; McGlinn v. Philadelphia et al., 186 A.747 (Pa. 1936), which found no liability where there was a 1 1/2” vertical separation between abutting curbstones; Newell v. Pittsburgh, 123 A.768 (Pa. 1924), involving 1 1/2” vertical separation between adjoining flagstones at a street crossing; and Pischke v. Dormont Borough, 33 A.2d 480 (Pa Super. 1943), no liability for saucer like depression of 1 1/2”.

Here, it is clear that the well-settled case law cited above mandates the compulsory nonsuit as entered by the trial court.

Under the applicable standard of review, the Pennsylvania Supreme Court upheld the refusal of the trial court to remove a compulsory non-suit involving a pedestrian injured by a fall on a sidewalk in the Borough of West View, Allegheny County in a case in which the municipality and additional defendant property owners were sued. See Foster v. West View Borough, et al. 195 A. 82 (Pa. 1937). In Foster, the question was whether there had been a negligent failure to maintain the sidewalk. Moreover, the difference in elevation between the sidewalk and an unpaved area was 2 to 4 inches. The Supreme Court found that compulsory non-suit was proper and noted:

The general rule with respect to cases of this character has been stated recently in Burns v. City of Pittsburgh, 320 Pa. 92, where we said (p.94) “The city had the duty of maintaining its streets in a reasonably safe condition for travel; and, to enable plaintiff to recover, he must establish a breach of duty which caused his injuiy. Proof of injury alone, without more, or of the existence of the negligent condition without showing that it caused the injury complained of, is insufficient to establish a case of liability. Erbe v. P.R.T. Co. 256 Pa. 567, 570; Beck v. Germantown Cricket Club, 37 Pa. Super. Ct. 521...

It is simply unreasonable and utterly idealistic to hold municipalities and property owners to a standard of maintaining pavement in pristine condition. The Pa. Supreme Court discussed the standard of care in upholding a compulsory nonsuit in McGlinn v. Philadelphia et al., 186 A. 747 (Pa. 1936):

The standard of care to which a city is held in the maintenance of its sidewalks is one of reasonable safety. It is not an insurer of absolute safety of the pedestrians who make use of its sidewalks and streets: Burns v. City of Pittsburgh, 320 Pa. 92. Not every depression or irregularity will serve to charge it with liability: Williams v. Kozlowski, 313 Pa. 219, 223. Each case must depend on its surrounding circumstances: Shafer v. Philadelphia, 60 Pa. Superior 256, 258. Possibility of accident will not warrant recovery: McIntyre v. City of Pittsburgh, 238 Pa. 524, 527.

In Newell v. Pittsburgh, 123 A. 768 (Pa. 1924), another premises liability case discussed by the Pa. Supreme Court, a plaintiff crossing the street at night brought suit where there was a one and one half inch difference in elevation between paving stones.

The court upheld JNOV for the defendant and opined:

The surface of city streets cannot be maintained in absolutely level condition. There must necessarily be unevenness and offsets here and there. The law does not require perfect sidewalks. The standard is reasonable safety. Id. at 769.

More recently, in a Philadelphia County case, Dudley v. Feldman and Philadelphia Gas, 31 Phila. 408, 1996 Phila Cty. Rptr.; 30 Pa. D. & C. 4th 97, which reviewed more than half a century of caselaw as discussed above, a 1 1/2” to 3/4” depression did not result in a breach of duty of care to a minor plaintiff, who broke his foot.

Our courts have wisely recognized that “the law does not require that sidewalks shall be as free of defects, imperfections, irregularities, unevennesses (sic), etc., as the floors of buildings.” German v. McKeesport City, 8 A.2d 437, 440 (Pa. Super. 1939). In German, which involves a 1 1/2” defect in a sidewalk, the Superior Court stated that to impose liability, “the defect must be so large and unusual as to appear dangerous to the ordinary pedestrian and everyday passerby,” and cautions against placing liability on common and usual sidewalk imperfections. Id. at 48, 8 A.2d at 441. Later cases have clearly restated the underlying principle that “an elevation, a depression or an irregularity on a street or highway may be so trivial that courts, as a matter of law, are bound to hold that there was no negligence in permitting such depression or irregularity to exist. Bosack v. Pittsburgh Railways Co., 410 Pa. 558, 583, 189 A.2d 877, 880 (1963).

Indeed, in an even more recent Philadelphia County case the trial court granted summary judgment in favor of the defendant property owner where the alleged defect was no more than an inch between parking lot blacktop and an adjoining sidewalk. Lawler v. Berat Corp., 2006 Phila. Ct. Com. Pl. LEXIS 377.

Here, the city of Philadelphia contends that a reasonable jury could have found that there was evidence of negligent sidewalk maintenance by the property owner Mr. Cook and cites federal guidelines for standards of care of a sidewalk involving a handicap ramp. However, the city’s liability expert himself agreed that there are thousands of sidewalks in Philadelphia with elevation levels of less than one inch. It would simply have been both contrary to caselaw and the imposition of an impossible standard of care throughout a modem metropolis to not have ruled as a matter of law that the 5/8” defect at issue was anything other than trivial Further, the federal guidelines cited by the city’s expert for handicap ramps where just that, guidelines, and not binding upon this court. The city does not cite a law binding the property owner or the city under the facts of this case where PennDOT installed a handicap ramp which at a small comer of the juncture with the sidewalk manifested a 5/8” difference in elevation, at most.

Given the overwhelming weight of the case law, and almost a century of established public policy the court’s entry of compulsory non-suit was appropriate. In fact, the court was bound as a matter of law to find no negligence where the defect is determined to be trivial. The reasonably safe condition which existed here was all that is necessary for the property owner, Lawrence Cook, to be found to have met the standard of care.

III. CONCLUSION

For the foregoing reasons, this court’s entry of compulsory non-suit was proper based on the evidence presented. Said order and judgment should be affirmed.


source: Caselaw Access Project

author: PICCIONE, J„

license: Public Domain

text:
    U.S. Bank Nat’l Ass’n v. Reese
    C.P. of Lawrence County,
    no. 10165 of 2010, C.A.

      Louis P Vitti, for plaintiff.

      Mark A. Krochka, for defendant.

      December 16, 2010
   PICCIONE, J„

Before this court for disposition is plaintiff’s motion for summary judgment. The current action arises from a note executed on April 17, 1986 by defendant Nancy F. Reese (hereinafter, “defendant”) in consideration of a loan of $35,150.00 made by Deliwood Corporation. The loan was provided to defendant for the purchase of the property located at 3201 Evergreen Road, Pulaski, Pa. 16143. The mortgage was recorded on April 24, 1986 in the Office of the Recorder of Deeds of Lawrence County at Book No. 744 Page No. 114. U.S. Bank National Association (hereinafter, “plaintiff’) ultimately acquired its interest in the mortgage by assignment from Pennsylvania Housing Finance Agency dated December 11, 2009 and recorded January 20, 2010.

On February 1, 2010, plaintiff filed a complaint in mortgage foreclosure, alleging that, since September 1, 2009, the mortgage has been in default due to the failure of defendant to make payments as provided under the terms of the mortgage. Plaintiff demands judgment for the amount due plus interest and costs, totaling $21,166.35. On February 19, 2010, defendant filed preliminary objections, claiming that she never received a notice of intent to foreclose, that plaintiff’s complaint was not properly verified, and that a copy of the original note was not attached to the complaint. Shortly thereafter, plaintiff filed an amended complaint in mortgage foreclosure with a proper verification and the original note attached. On April 6, 2010, defendant responded to plaintiffs amended complaint with an answer. In her answer, defendant provides her correct mailing address, indicating that the address plaintiff lists as defendant’s address in the original complaint is not correct. Defendant also alleges that she made some, but not all, mortgage payments subsequent to September 1, 2009. Finally, defendant reasserts that plaintiff failed to provide proper notice, depriving this court of jurisdiction over this matter.

On June 1, 2010, plaintiff filed the instant motion for summary judgment as well as an affidavit from an employee of the Pennsylvania Housing Finance Agency. Upon plaintiff’s request, the court issued an order advising the parties that plaintiff’s motion for summary judgment will be decided on briefs without oral argument. Defendant failed to submit a brief or other response to plaintiff’s motion for summary judgment.

Initially, the court will address whether plaintiff provided proper notice of its intent to foreclose, as defendant argues that the failure to do so deprives this court of jurisdiction to proceed with this matter. In her preliminary objections, defendant asserts that plaintiff failed to comply with the notice requirements of Act 6 of 1974 (41 P.S. §403) and Act 91 of 1983 (35 P.S. § 1680.402c(a)). A review of the exhibits attached to plaintiff’s supporting affidavit and amended complaint reveals that plaintiff sent defendant an Act 91 notice. The Homeowners’ Emergency Mortgage Assistance Act of 1983 indicates that “[tjhis notice shall be in lieu of any other notice required by law.” 35 P.S. § 1680.403c(b)(1). Plaintiff also sent defendant an Act 6 notice.

Defendant suggests that plaintiff mailed the notice to an incorrect address. She states in her answer that her mailing address is P.O. Box 263, New Bedford, Pa. 16140. Although plaintiff lists defendant’s address in its original complaint as 263 Evergreen Road, New Bedford, Pa. 16140, plaintiff sent notice to the P.O. Box 263 address. This is demonstrated by the exhibits attached to plaintiff’s supporting affidavit, including postmarked receipts for both certified and regular mail sent to defendant at P.O. Box 263, New Bedford, Pa. 16140. Pl.’s Aff., Ex. F.

Despite plaintiff’s exhibits, defendant maintains that she did not receive notice of plaintiff’s intention to foreclose. While the court does not dispute this contention, it is noted that actual receipt is not essential to fulfilling the notice requirement. Second Federal Savings and Loan Association v. Brennan, 598 A.2d 997, 1000 (Pa. Super. 1991). Plaintiff sent notices containing the necessary information to the correct addresses. Therefore, plaintiff complied with the notice requirements.

In addition to the issue of notice, defendant’s answer contains two other points not included in plaintiff’s complaints. First, defendant submits that some mortgage payments were made subsequent to September 1, 2009. Second, defendant claims that she is without knowledge to form a belief as to the correctness of the amount plaintiff claims is due. Plaintiff argues that these claims should not preclude entry of summary judgment.

Under Pennsylvania law, the standard for summary judgment is set forth by Rule 1035.2 of the Pennsylvania Rules of Civil Procedure:

After the relevant pleadings are closed, but within such time as not to unreasonably delay trial, any party may move for summary judgment in whole or in part as a matter of law
(1) whenever there is no genuine issue of any material fact as to a necessary element of the cause of action or defense which could be established by additional discovery or expert report, or (2) if, afterthe completion of discovery relevant to the motion, including the production of expert reports, an adverse party who will bear the burden of proof at trial has failed to produce evidence of facts essential to the cause of action or defense which in a jury trial would require the issues to be submitted to a jury. Pa.R.C.P. 1035.2.

The moving party bears the burden of demonstrating that no genuine issue of material fact exists. Rush v. Philadelphia Newspapers, Inc., 732 A.2d 648, 650 (Pa. Super. 1999). “In considering the merits of a motion for summary judgment, a court views the record in the light most favorable to the moving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party.” Toy v. Metropolitan Life ins. Co., 593 Pa. 20, 34, 928 A.2d 186, 194-95 (Pa. 2007). Rule 1035.3 provides, however, that when confronted by a motion for summary judgment, “the adverse party may not rest upon the mere allegations or denials of the pleadings but must file a response within thirty days after service of the motion[.]” Pa.R.C.P. 1035.3(a). In a mortgage foreclosure action, entry of summary judgment is appropriate where mortgagors “admit that the mortgage is in default, that they have failed to pay interest on the obligation, and that the recorded mortgage is in the specified amount.” Cunningham v. McWilliams, 714 A.2d 1054, 1057 (Pa. Super. 1998) (citing Landau v. Western Pennsylvania Nat. Bank, 445 Pa. 217, 225, 282 A.2d 335, 340 (Pa. 1971)).

Defendant has admitted that the mortgage is in default. She states in her answer that “not all payments were made.” Def.’s Answer, at 2. Furthermore, plaintiff’s supporting affidavit contains defendant’s payment history, which indicates that, since June 1, 2009, defendant has failed to tender sufficient funds to cure her default completely. Pl.’s Affi., Ex. D. Although defendant made payments subsequent to September 1, 2009, she has also missed payments and remains in default. Because defendant does not dispute these allegations, the court concludes that defendant admits that she is in default.

Defendant also states in her answer that she is without knowledge to form a belief as to the accuracy of the amount plaintiff claims is due. In a mortgage foreclosure action, the mortgagors and mortgagee are the only parties with sufficient knowledge to base a specific denial. New York Guardian Mortgage Corp. v. Dietzel, 524 A.2d 951, 952 (Pa. Super. 1987). “[GJeneral denials by mortgagors that they are without information sufficient to form a belief as to the truth of averments as to the principal and interest owing must be considered an admission of those facts.” First Wisconsin Trust Co. v. Strausser, 653 A.2d 688, 692 (Pa. Super. 1995). Therefore, defendant’s general denial of the specific amount claimed by plaintiff will operate as an admission. Since defendant admits all of the other allegations in plaintiff’s complaints, there exists an absence of any genuine issue of material fact and plaintiff is entitled to judgment as a matter of law. Therefore, plaintiff’s motion for summary judgment is granted.

ORDER OF COURT

And now, December 16, 2010, the court having received plaintiff’s motion for summary judgment and brief in support thereof, with Louis P. Vitti, Esquire, representing the plaintiff U.S. Bank National Association, and Mark A. Krochka, Esquire, representing the defendant Nancy F. Reese, it is hereby ordered and decreed as follows:

1. Plaintiff’s motion for summary judgment is granted pursuant to the attached opinion.
2. The prothonotary shall properly serve notice of this order and attached opinion upon counsel of record; and if a party has no counsel, then upon said party at their last known address as contained in the court’s file.


author: PICCIONE, J.,

text:
    Prowell v. Eastwood Chrysler-Plymouth, Inc.

      December 16, 2010
    C.P. of Lawrence County,
    no. 10267 of 2010, C.A.

      Douglas J. Olcott, for plaintiff.

      William R. Haushalter, for defendant Preston Auto Mall.
   PICCIONE, J.,

Before this court for disposition is a renewed motion for summary judgment filed by defendant Preston Auto Mall, Inc., t/d/b/a a/k/a Preston Chrysler Plymouth Jeep (hereinafter, “Preston”). The current action arises out of an accident in which plaintiff Lefaughn Prowell (hereinafter, “plaintiff’) fell out of and was run over by a 1989 Chrysler Lebaron owned by his grandmother, Ethel Prowell. On August 24, 2003, defendant Cheryl Mitchell, plaintiff’s aunt, parked the Chrysler Lebaron at the West Side Mini Mart in New Castle and exited the vehicle, leaving the five-year-old plaintiff unattended. Shortly thereafter, the car’s gear selector lever shifted out of the parked position, causing the car to roll backwards. The car was equipped so that it could be shifted from the parked position after the ignition key had been removed. As the car rolled backwards, plaintiff fell out of and was run over by the vehicle, resulting in serious injuries and damages.

On August 23, 2005, plaintiff filed a complaint naming, among others, Eastwood Chrysler-Plymouth, Inc. (hereinafter, “Eastwood”) and Preston as defendants. Plaintiff alleges that Ethel Prowell purchased the Chrysler Lebaron from Eastwood and that Eastwood subsequently sold and transferred its assets to Preston in September of 1996. Plaintiff further alleges that the Chrysler Lebaron was serviced by Preston following the sale and transfer of assets. On October 10, 2006, Preston filed a motion for summary judgment, claiming that Preston did not assume any of Eastwood’s liabilities. In an order of court dated June 21, 2007, this court denied Preston’s motion on the basis that the transfer and sale of assets between Eastwood and Preston “amounted to a defacto merger.” Prowell v. Daimler Chrysler AG, No. 10992 of 2005, C.A. (C.P. Lawrence June 21, 2007).

This case was held in abeyance due to the bankruptcy filing of Daimler Chrysler Corporation until February 12, 2010, when this court granted plaintiff’s request to sever Daimler Chrysler Corporation and permit this case to go forward. Citing a change in the controlling law regarding de facto mergers, Preston filed the instant renewed motion for summary judgment on March 3, 2010. Oral argument regarding Preston’s motion was held on May 24, 2010.

Under Pennsylvania law, the standard for summary judgment is set forth by Rule 1035.2 of the Pennsylvania Rules of Civil Procedure. The rule states:

After the relevant pleadings are closed, but within such time as not to unreasonably delay trial, any party may move for summary judgment in whole or in part as a matter of law
(1) whenever there is no genuine issue of any material fact as to a necessary element of the cause of action or defense which could be established by additional discovery or expert report, or (2) if, after the completion of discovery relevant to the motion, including the production of expert reports, an adverse party who will bear the burden of proof at trial has failed to produce evidence of facts essential to the cause of action or defense which in a jury trial would require the issues to be submitted to a jury. Pa.R.C.P. 1035.2.

The moving party bears the burden of proving that no genuine issue of material fact exists. Rush v. Philadelphia Newspapers, Inc., 732 A.2d 648, 650 (Pa. Super. 1999). In determining whether summary judgment is appropriate, the trial court is required to view the record in a light most favorable to the non-moving party, and “all doubts as to the existence of a genuine issue of material fact must be resolved in favor of the nonmoving party.” P.J.S. v. Pennsylvania State Ethics Comm’n. 555 Pa. 149, 723 A.2d 174 (Pa. 1999) (citing Kapres v. Heller, 536 Pa. 551, 640 A.2d 888 (Pa. 1994)). Summary judgment is proper only when the uncontroverted allegations in the pleadings, depositions, answers to interrogatories, admissions of record and submitted affidavits demonstrate that no genuine issue of material fact exists, and that the moving party is entitled to judgment as a matter of law. Potter v. Herman, 762 A.2d 1116, 1117 (Pa. Super. 2000).

Generally, “when one company sells or transfers all of its assets to another company, the purchasing or receiving company is not responsible for the debts and liabilities of the selling company simply because it acquired the seller’s property.” Continental Ins. Co. v. Schneider, Inc., 582 Pa. 591, 599, 873 A.2d 1286, 1291 (Pa. 2005) (citing Hill v. Trailmobile, Inc., 603 A.2d 602, 605 (Pa. Super. 1992)). This general rule of non-liability may be overcome if:

(1) the purchaser expressly or implicitly agreed to assume liability, (2) the transaction amounted to a consolidation or merger, (3) the purchasing corporation was merely a continuation of the selling corporation, (4) the transaction was fraudulently entered into to escape liability, or (5) the transfer was without adequate consideration and no provisions were made for creditors of the selling corporation. Id.

The second of these exceptions, the de facto merger doctrine, is designed to prevent an entity from escaping its obligations through “sham corporate reorganizations” by imposing successor liability. Fizzano Bros. Concrete Products, Inc. v. XLN, Inc., 973 A.2d 1016, 1019 (Pa. Super. 2009). In determining whether a de facto merger has occurred, courts look to the following four factors: continuity of ownership; cessation of the ordinary business by, and dissolution of, the predecessor as soon as practicable; assumption by the successor of liabilities ordinarily necessary for uninterrupted continuation of the business; and continuity of the management, personnel, physical location, and the general business operation. Continental Ins. Co. v. Schneider, Inc., 810 A.2d 127, 135 (Pa. Super. 2002).

The issue in this case is whether the first of the abovementioned factors, continuity of ownership, is essential to a finding of a de facto merger. This court previously found that “[i]n the instant case, the relevant evidence indicates that there was no continuity of ownership between [Preston] and its predecessor.” Prowell v. Daimler Chrysler AG, No. 10992 of 2005, C.A. (C.P. Lawrence June 21, 2007). As a result, successor liability connot be imposed upon Preston if Pennsylvania law currently considers continuity of ownership to be an essential element of a de facto merger. Preston argues that the Superior Court’s decision in Fizzano established that continuity of ownership must exist if a court is to find that a de facto merger occurred. Plaintiff argues that Fizzano did not impose such a requirement and that this court does not need to reconsider its June 21, 2007 order in light of the Fizzano decision.

In Fizzano, the plaintiff business brought an action against the defendant corporation on a debt owed it by a company whose assets the defendant corporation had purchased. Fizzano, 973 A.2d at 1018. The trial court applied the de facto merger doctrine to impose successor liability on the defendant corporation. Id. In reversing the trial court’s decision, the Superior Court stated:

With regard to continuity of ownership, the trial court acknowledged that none of the owners of [the predecessor business] became owners of [the defendant corporation].... This finding, by itself, should have ended the trial court’s consideration of [the defendant corporation]’s potential successor liability. Continuity of ownership is a key element that must exist in order to apply the de facto merger doctrine, since in the absence of a transfer of stock for assets the consequence of the transaction is not the functional equivalent of a merger. Instead, where there is no continuity of ownership the transaction is merely an arms-length transaction between two corporations and not in any sense a merging of two corporations into one. Id. at 1020. (emphasis added)

Based on this reasoning, the Superior Court held that the de facto merger doctrine did not apply. Id.

In disputing the above-quoted language of Fizzano, plaintiff relies heavily on Schneider, a previous Superior Court decision that seemed to indicate that continuity of ownership is not an essential element in a de facto merger claim. The Superior Court in Fizzano addresses the supposed inconsistency between the two decisions as follows:

In Schneider, after setting forth the four factors in the analysis, we commented that “[although each of these factors is considered, all need not exist before a de facto merger will be deemed to have occurred.” Schneider, 810 A.2d at 135. Contrary to the trial court’s understanding of this statement, however, this court did not intend to de-emphasize the importance of continuity of ownership as a key factor in a de facto merger analysis. In fact, our disposition in Schneider compels precisely the opposite conclusion, since in that case three of the four factors in the analysis were found to exist, with only the issue of continuity of ownership subject to remaining factual disputes. We concluded that so long as an issue of material fact remained with regard to continuity of ownership, summary judgment could not be granted on the de facto merger claim. Id. In reversing the trial court’s grant of summary judgment in Schneider, we emphasized, rather than de-emphasized, the importance of continuity of ownership in the de facto merger analysis. Fizzano, 973 A.2d at 1021-22. (emphasis in original)

Therefore, the Superior Court’s current understanding of the reasoning and holding in Schneider is that, in conformity with Fizzano, continuity of ownership is a required element of a de facto merger claim.

Plaintiff questions the precedential value of Fizzano because it was a 2-1 panel decision and Schneider was a 3-0 panel decision. Plaintiff assumes that Fizzano and Schneider are inconsistent, but, as stated above, the two decisions are uniform on the question of whether continuity of ownership is essential to a de facto merger claim. Furthermore, a decision on an issue in a panel decision is precedential if it commands a majority both as to the rationale and the result. Askew v. Zeller, 521 A.2d 459, 462 (Pa. Super. 1987). Because a majority of the Superior Court panel in Fizzano reached a decision on the instant issue, that principle should be afforded precedential weight.

Plaintiff also points out that, on May 19, 2010, the Supreme Court of Pennsylvania granted the petition for allowance of appeal in Fizzano on the issue of whether the de facto merger doctrine always requires proof of continuity of ownership. Fizzano Bros. Concrete Products, Inc. v. XLN, Inc., 606 Pa. 48, 994 A.2d 1081 (Pa. 2010). This court cannot assume that the Pennsylvania Supreme Court’s decision to grant the petition for allowance of appeal demonstrates an intent to reverse the Superior Court’s decision on the instant issue. Marks v. Nationwide Ins. Co., 762 A.2d 1098, 1101 (Pa. Super. 2002). As long as the Superior Court has not been overruled, the Superior Court’s decision in Fizzano remains binding precedent. Commonwealth v. Spease, 911 A.2d 952, 959 (Pa. Super. 2005).

Plaintiff argues in the alternative that, aside from successor liability, Preston owed an independent duty to plaintiff in that Preston should have alerted Ethel Prowell to the fact that some Chrysler vehicles could be shifted out of park after the ignition key was removed. Plaintiff asserts that Preston had an opportunity to do so when Ms. Pro well had the Lebaron serviced by Preston. Plaintiff cites Walton v. AVCO Corp., 530 Pa. 568, 577, 610 A.2d 454, 459 (Pa. 1992), for the principle that a seller of a defective product has an independent duty to make reasonable attempts to warn the users of the defective product once the seller learns of a defect in the product. No evidence has been presented indicating that Preston was aware or should have been aware of a defect in the Lebaron. Plaintiff only offers a copy of a recall report dated January 7, 2004, several months after the accident, which does not mention Chrysler Lebarons or any other model manufactured prior to 1993. Because the evidentiary record does not contain sufficient evidence on an element of plaintiff’s cause of action, the duty to warn claim should not be submitted to the jury. Ertel v. Patriot-News Co., 544 Pa. 93, 101, 674 A.2d 1038, 1042 (Pa. 1996). Furthermore, plaintiff did not include this separate “duty to warn” theory of recovery in the original complaint, and, as a result, the claim is time-barred.

The Superior Court’s decision in Fizzano represents the current state of Pennsylvania law on the controlling issue in this case. Accordingly, the lack of continuity of ownership between Eastwood and Preston bars the use of the de facto merger doctrine and renders the general rule prohibiting successor liability applicable. Because no genuine issue of material fact exists and Preston is entitled to judgment as a matter of law, Preston’s renewed motion for summary judgment is granted.

ORDER OF COURT

And now, December 16, 2010, the court having held oral argument on May 24, 2010 regarding defendant’s renewed motion for summary judgment, with Douglas J. Olcott, Esquire, appearing and representing the plaintiff, and William R. Haushalter, Esquire, appearing and representing the defendant Preston Auto Mall, Inc., t/d/b/a a/k/a Preston Chrysler Jeep, it is hereby ordered, adjudged and decreed as follows:

1. Defendant’s renewed motion for summary judgment is granted pursuant to the attached opinion.
2. The prothonotary shall properly serve notice of this order and attached opinion upon counsel of record; and if a party has no counsel, then upon said party at their last known address as contained in the court’s file.

      . Recent federal court decisions have similarly concluded that the Superior court’s decision in Fizzano is controlling on the issue of whether continuity of ownership is essential to a de facto merger claim. Greenway Center, Inc. v. Essex Ins. Co., 369 Fed.Appx. 348, 352-53 (3rd. Cir. 2010) (finding that Fizzano does not conflict with Schneider and reiterating the principle that continuity of ownership is a key element that must exist in order to apply the de facto merger doctrine); Johnson v. Correctional Physician Services, 2010 WL 2836346 (E.D.Pa. 2010) (finding that Fizzano represents Pennsylvania law as it now stands despite the Pennsylvania Supreme Court’s granting allocatur and reiterating the principle that continuity of ownership is a key element that must exist in order to apply the de facto merger doctrine).


author: MOTTO, P.J.,

text:
    Painter v. Aqua Pennsylvania, Inc.

      C.P. of Lawrence County,
    no. 10462 of 2010, C.A.

      Stephen J. DelSole, Patrick K. Cavanaugh, Matthew T.

      Logue, and William S. Stickman IV, for plaintiff.
    December 13, 2010

      Coleen M. Meehan, Anthony C. DeCusatis, Adina D. Bingham, and Elizabeth Stroyd Windsor, for defendant.
   MOTTO, P.J.,

Before the court for disposition are the defendant’s preliminary objections to the first amended complaint seeking dismissal on jurisdictional grounds. Defendant contends that the amended complaint challenges the rates charged by the defendant and the defendant’s billing practices; therefore, the court of common pleas has no jurisdiction over this dispute because the general assembly has delegated to the Pennsylvania Public Utility Commission (“PUC”) exclusive authority to regulate the rates, terms and conditions of public utility service in the Commonwealth. The court finds that the PUC has initial and primary jurisdiction over the subject matter of this complaint; towit, the rates charged by the defendant and the defendant’s billing practices, but that the jurisdiction of the PUC is not exclusive beyond these matters and the remedies allowed by the Public Utility Code. Therefore, for the reasons set forth below, the preliminary objections will be sustained to the extent that this proceeding shall be stayed pending the transfer of this case to the PUC, with this court to thereafter proceed on the claims not resolved by the PUC after its eventual rulings issues relating to rates and billing practices.

The plaintiffs’ putative class action amended complaint alleges that the defendant Aqua Pennsylvania, Inc. (“Aqua”) billed rate increases for the Distribution System Improvement Charge (“DSIC”) prior to the effective date set by the PUC. Plaintiffs allege that each and every time that defendant was authorized to increase the DSIC, it retroactively billed its customers the increased rate for the period of their billing cycle preceding the effective date of increase. As a result, defendant charged its customers amounts that were not owed, since the billing cycle began prior to the effective date of the increase. The amended complaint alleges causes of action consisting of alleged violation of the Unfair Trade Practices and Consumer Protection Law (“UTPCPL”), conversion, and breach of contract. In addition to compensatory damages, the amended complaint seeks punitive damages and the statutory damages authorized by the UTPCPL. Defendant contends that the substance of the plaintiffs’ amended complaint is the rate being charged by defendant; that the heart of each count of the amended complaint, regardless of how the cause of action is stated, is a challenge to defendant’s billing practices and, therefore, to its rates. Accordingly, defendant argues that exclusive jurisdiction of the subject matter of the complaint rests with the PUC pursuant to the Public Utility Code, 66 Pa.C.S.A. §1301 et seq. Defendant cites a number of sections in the public utility code, which set forth specific limitations upon the rates that can be charged by public utilities and procedures seeking redress before the public utility commission on a claim that a public utility has charged an unauthorized rate.

Plaintiffs contend that they do not challenge the validity or reasonableness of the rates approved by the PUC, the tariff governing those rates, the authority of the PUC to approve and regulate the tariff or any other issue related to the rates, terms or conditions of public utility services provided by defendant; but rather, recognize the PUC’s exclusive authority to determine such matters. Plaintiffs argue that their claims raise only statutory and common law claims sounding in tort and contract arising from deceptive practices of defendant in taking money from its customers under false pretenses in violation of their respective contracts. Plaintiffs note that a key component of their claim is that the defendant used deceptive practices to enrich itself in violation of the UTPCPL and the terms of its contract with its customers by charging a rate to its customers prior to the time that it was authorized by the tariff. Plaintiffs argue that in making these claims, they take for granted that the PUC validly approved the tariff which set forth the dates that the DSIC was permitted to be raised.

In determining preliminary objections, the court must consider as true all well-pleaded material facts and all reasonable inferences that may be drawn from those facts. Sheffield v. Department of Corrections, 894 A.2d 836 (Pa. Cmwlth. 2006). Preliminary objections will be sustained only where defendant’s right to relief is clear and free from doubt. Id. McGriff v. Pennsylvania Board of Probation and Parole, 809 A.2d 455 (Pa. Cmwlth. 2002). Where preliminary objections raise a question of subject matter jurisdiction, the junction of the court is to determine whether recovery will be barred due to a lack of subject matter jurisdiction. Kimmel Township Taxpayers Association v. Claysburg Kimmel School District, 604 A.2d 1149, 1152 (Pa. Cmwlth. 1992).

It is well established that:

The courts will not originally adjudicate matters within the jurisdiction of the PUC. Initial jurisdiction in matters concerning the relationship between public utilities and the public is in the PUC-not the Courts. Borough of Lansdale v. Philadelphia Electric Company, 403 Pa. 647, 650, 170 A.2d 565, 567 (1961) quoted in Allport Water Authority et al. v. Winburne Water Co., 393 A.2d 673, 674 (Pa. Super. 1978).

In Morrow v. Bell Telephone Company of Pennsylvania, 479 A.2d 548 (Pa. Super. 1984), the plaintiff brought an action in equity seeking class action certifica-tion and challenging, the defendant telephone company’s rates and service practices. The court found that the action, which was couched in terms of equity, was actually a challenge to the rates and services, therefore, jurisdiction was vested in the PUC. Id. 479 A.2d at 551. The Morrow court held that although the complaint contained averments of breach of contract, the averments were but a cover disguising the real thrust of the complaint.

In County of Erie v. Verizon North, Inc., 879 A.2d 357 (Pa. Cmwlth. 2005), the county had filed its complaint against the defendant service provider contending that the defendant did not fulfill its financial responsibilities regarding the county’s 911 emergency communication system. Defendant filed preliminary objections contending that the PUC had primary jurisdiction over the subject matter of the complaint. The complaint included claims for accounting, injunctive relief, breach of fiduciary duty, unjust enrichment and conversion. In determining that the PUC had primary jurisdiction, the court stated that in determining whether the doctrine of primary jurisdiction applies, courts must look beyond the form of the action to the essence of the underlying claims. The court went on to agree with defendant verizon that the factual issue upon which the claim was based was whether verizon correctly billed, collected and remitted the 911 contribution rate, a matter which related to the tariff. The court quoted Morrow, which stated:

Matters relating to the tariff...are peculiarly within the expertise of the PUC and, as such, are outside the original jurisdiction of the courts. Morrow, 479 A.2d at 550 (quoting Bell Telephone Co. v. Uni-Lite, Inc., 294 Pa.Super. 89, 439 A.2d 763, 765 (1982)).

As set forth in County of Erie, the Public Utility Code defines the term “tariff’ as:

All schedules of rates, all rules, regulations, practices, or contracts involving any rate or rates, including contracts for interchange of service, and, in the case of the common carrier, schedules showing the method of distribution of the facilities of such common carrier. 66 Pa.C.S. §102.

Further, the code defines “rate” as follows:

Every individual, or joint fare, toll, charge, rental or other compensation whatsoever of any public utility, or contract carrier by motor vehicle, made, demanded or received for any service within this part, offered, rendered, or furnished by such public utility, or contract carrier by motor vehicle, whether in currency, legal tender or evidence thereof, in kind, in services or in any other medium or manner whatsoever, and whether received directly or indirectly, and any rules, regulations, practices, classifications, contracts affecting such compensation, charge, fare, toll or rental. 66 Pa.C.S. §102 (emphasis supplied).

The doctrine of primary jurisdiction should be invoked to require a court to refrain from hearing a case where protection of the integrity of the regulatory scheme dictates that the parties preliminarily resort to the agency that administers the scheme for the resolution of disputes. Weston v. Reading Co., 445 Pa. 182, 282 A.2d 714 (1971). In Elkin v. Bell Telephone Co., 491 Pa. 123, 420 A.2d 371 (1980), the Supreme Court in discussing the doctrine stated that one of its purposes is to make use of the agency’s special experience and expertise in complex areas and to promote consistency and uniformity in the area of administrative policy. Id. 491 Pa. at 132-33, 420 A.2d at 376. Elkin further noted that the doctrine of primary jurisdiction is principally applied to controversies involving “regulated industries.” Id. at 133, 420 A.2d at 376. Where the court in which original jurisdiction was invoked determines that agency has primary jurisdiction, the trial court has the authority to transfer the matter to the appropriate administrative agency. Id.

Here, the allegations of the amended complaint involve a challenge to the billing practices of the defendant. The allegations are that defendant billed its customers a rate for a period of time before that rate became effective. Therefore, it necessarily follows that for the period of time from the beginning of the billing cycle until the effective date of the allowed rate, plaintiffs are contending that the defendant charged plaintiffs an unauthorized rate. Stated another way, the essence of the amended complaint is that for a period, defendant charged and collected an illegal rate not authorized by any tariff of the PUC. The court concludes that the PUC has exclusive jurisdiction over rates that can be charged by a public utility and the billing practices relative to those rates, and thus has primary jurisdiction over the subject matter of this case.

Section 1303 of the Public Utility Code (66 Pa.C.S.A. § 1303) provides that “No public utility...demand or receive from any person...a greater or lesser rate for any service rendered or to be rendered by any such public utility then that specified in the tariffs of such public utility applicable thereto.” Section 1312 of the Public Utility Code (66 Pa.C.S.A. §1312) provides for a refund where a public utility has received a rate in excess of the applicable rate contained in an existing and effective tariff, giving the PUC the power and authority to make an order requiring the public utility to refund the amount of any excess paid by any patron together with interest at the legal rate from the date of such excessive payment. Thus, plaintiffs have the right to institute and seek a refund action before the PUC pursuant to §1312 for the rate charged that plaintiffs deem was in violation of the tariff. Although plaintiffs have couched their claims as being in violation of the UTPCPL, breach of contract and conversion, in each alleged cause of action the heart of the claim is based on the allegation that plaintiffs were charged rates at the beginning of a billing cycle and for a period of time prior to the effective date from which the date was authorized, and thus were charged an illegal rate. This is precisely the type of claim that is best suited to the expertise of the PUC.

Once the court determines that the PUC has primary jurisdiction, the court must next determine whether the jurisdiction of the PUC is exclusive, thus requiring the dismissal of the proceeding before the court, or, whether the jurisdiction of the PUC is not exclusive, in which case the court may proceed with an action for damages based on the determination of the PUC of the matters within its realm of expertise.

The standard to be applied in determining whether the PUC’s jurisdiction is exclusive is set forth in DiSanto v. Daufin Consolidated Water Supply Company, 436 A.2d 197, 202 (Pa. Super. 1981) as follows:

Having determined that the instant case involves matters within the normal sphere of the PUC, we must now decide whether the PUC’s jurisdiction is exclusive or whether the bifurcated procedure adopted by the Elkin court should be followed in the instant case. Such a determination, however, is dependent upon the adequacy of the administrative remedies available to the appellee through the PUC. If the available administrative remedies are complete and adequate to make the complainant whole, then the PUC has exclusive jurisdiction over the controversy and there is no recourse to the courts outside of the normal channels of appeal and to the Commonwealth Court. However, where the administrative remedies are not adequate and complete, the PUC’s jurisdiction is not exclusive and an action for damages may be brought in a court of common pleas based upon the PUC’s initial determination of the matters within its realm of expertise.

In Elkin v. Bell Telephone, 491 Pa. 123, 420 A.2d 371 (1980), the Supreme Court approved a bifurcated procedure where the accommodation of the respective spheres of the adjudicatory authority of the PUC and the courts of common pleas could be accomplished. The bifurcated procedure approved by Elkin provides for a civil suit for damages to be stayed pending a determination by the PUC of the matters that are within its exclusive jurisdiction. Judicial abstention protects the integrity of a regulatory scheme within the jurisdiction of the PUC, providing for a preliminary resort to the PUC. After a determination of the issues within the exclusive jurisdiction of the PUC, the pending action in the court of common pleas would not be used to re-litigate the questions determined by the PUC, but only to litigate the questions not resolved through administrative channels and to grant relief, if any, including damages that may be appropriate in light of the administrative determination. Once the administrative tribunal has determined the issues within its jurisdiction, then the temporarily suspended civil litigation may continue, guided in scope and direction by the nature and the outcome of the agency determination. Elkin, 491 Pa. at 133-314, 420 A.2d at 377, citing Finegold v. Bell of Pennsylvania, 477 Pa. 1, 8, 383 A.2d 791, 794 (1977).

The court here concludes that this court must retain jurisdiction subject to deferral of initial jurisdiction to the PUC because the PUC cannot fully address all of the claims for damages set forth in the amended complaint. In particular, plaintiffs raise claims under the UTPCPL which provides a statutory remedy which is not limited to the actual loss. The UTPCPL provides for statutory damages in the amount of the consumer’s actual damages, or $100 per violation, whichever is greater, in addition to attorneys fees and costs. 73 Pa.C.S.A. §201-9.2(a). The statutory damages of $ 100 per violation are greater than the amounts that plaintiffs could obtain on a refund awarded by the PUC. Plaintiffs also seek punitive damages, which are not available as a remedy before the PUC. If this court were to hold that the jurisdiction of the PUC is exclusive, then, by judicial decision, the court would be abrogating plaintiffs right to recover under the UTCPTL, even if plaintiffs are otherwise able to meet their burden of proof as to all of the elements of the claim brought pursuant to that statute. Also, plaintiffs would be denied the right to recover punitive damages, even if they were able to otherwise meet the burden of proof that would allow for the recovery of punitive damages. Such a result would be directly contrary to § 103(c) of the Public Utility Code. As plaintiffs correctly note, this provision of the code states:

Remedies cumulative. Except as otherwise provided in this part, nothing in this part shall abridge or alter the existing rights of action or remedies in equity or under the common or statutory law of this Commonwealth, and the provisions of this part shall be cumulative and in addition to such rights of action and remedies. 66 Pa.C.S.A. § 103(c).

Therefore, a conclusion that the jurisdiction of the PUC is exclusive in this matter would run contrary to § 103(c) of the Public Utility Code in that plaintiffs’ rights of action and remedies available to them under the UTCPTL, and under common law actions for breach of contract and conversion, to the extent they allow for damages that go beyond a simple refund, would be abrogated. The court finds that such a conclusion would be contrary to the holdings of the Supreme Court in Finegold and Elkin, which must be followed.

For the reasons above stated, the court will enter an order which shall grant the defendant’s preliminary objections to the extent that the court finds that the PUC has primary jurisdiction of this controversy and all proceedings herein shall be stayed pending the conclusion of proceedings before the Public Utility Commission. Jurisdiction of this case shall be transferred to the Public Utility Commission.

ORDER OF COURT

And now, December 13, 2010, for the reasons set forth in the accompanying opinion of even date herewith, it is ordered and decreed that the defendant’s preliminary objections are sustained in part. All proceedings in this matter are hereby stayed pending a resolution of plaintiffs’ claims by the Pennsylvania Public Utility commission. Jurisdiction is deferred and the within case and matter is hereby transferred to the Pennsylvania Public Utility Commission for disposition. All remaining preliminary objections not relating to jurisdiction are overruled.


author: MILLER, J.,

text:
    Bodon-Soto v. Cohen

      October 28, 2010
    C.P. of Monroe County,
    no. 707 CIVIL 2007.

      David J. Williamson, for plaintiff.

      Edwin A. Abrahamsen Jr., for defendant.
   MILLER, J.,

In this personal injury case, Arlene Cohen (“defendant”) requests this court to enter judgment notwithstanding the verdict, or in the alternative, a new trial following a jury verdict in favor of Lydia Bodon-Soto (“plaintiff’) in the amount of $150,000.00.

On June 23, 2005, plaintiff leased a home, beginning on July 1, 2005, located in Pocono Country Place, Tobyhanna from defendant. [Notes of testimony, June 8, 2010, at p. 32-33] (hereinafter “N.T.”) After plaintiff experienced difficulties breathing [N.T. p. 116], mold was discovered in the home. [N.T. p. 121,123] Plaintiff vacated the premises and presented to Pocono Medical Center with bronchitis. Plaintiff was admitted to and remained in the hospital for several days. [N.T. p. 122] Upon discharge from the hospital plaintiff never returned to the home. [N.T. p.122] Plaintiff then brought this personal injury claim against defendant, her landlord.

In her post-trial motions, defendant requests this court to enter judgment notwithstanding the verdict (JNOV) in her favor. There are two bases upon which a court can enter judgment notwithstanding the verdict: one, the movant is entitled to judgment as a matter of law, or two, the evidence was such that no two reasonable minds could disagree that the outcome should have been rendered in favor of the movant. Foster v. Maritrans, Inc., 790 A.2d 328, 330-331 (Pa. Super. 2002) (citation omitted). The evidence is viewed “in the light most favorable to the verdict winner, granting that party the benefit of all reasonable inferences.” Juliano v. Johns-Manville Corp., 611 A.2d 238, 239 (Pa. Super. 1992) (citation omitted). A judgment notwithstanding the verdict should be entered only in clear cases, and all doubt should be resolved in favor of the verdict winner. Pencil v. Buchart, 551 A.2d 302, 305 (Pa. Super. 1988). For a motion for judgment notwithstanding the verdict, the judge’s appraisement of the evidence is not to be based on how she would have voted had she been a member of the jury, but on the facts as they come through the sieve of the jury’s deliberations. Foster, supra at 331 (citation omitted).

In support of her request for JNOV, defendant contends that there was no proof of causation as to plaintiff’s injury. In addition, defendant argues that there are no regulatory standards which establish an injury-causing level of mold within a residence, and, accordingly, plaintiff’s cause of action must fail.

Defendant argues that plaintiff’s fact witness, Steven Wallace of ServPro, had no formal training and should not have testified about mold he viewed in the home six months prior to plaintiff’s occupancy. A review of the trial transcript demonstrates that Mr. Wallace was not qualified as an expert witness. As a fact witness, he testified as to his observations in the home. Mr. Wallace testified that he did not take any mold samples nor was he trained to take samples of any mold. [N.T. p. 29] The jury was free to accept or reject his testimony as with any fact witness.

Defendant also objected to certain evidence that was introduced at the time of trial. Plaintiff presented the testimony of Jeremy Young from Pocono Environmental Laboratories. Mr. Young testified about testing completed in the home [N.T., p. 198-199], including five (5) minute air tests. [N.T., p. 201] Both air samples and swab tests were completed in the home. [N.T., p. 198] These tests showed unacceptable levels of Aspergillus/Penicillium mold found in the living room. [N.T., p. 200] The level of mold found was 1,748 count per meter cubed. [N.T., p. 200] Mr. Young testified that any number over 500 in an indoor space is considered hazardous. [N.T., p. 200]

In rebuttal, defendant’s expert, Harry M. Neill, from 1 Source safety and health, testified about the methodologies used by Pocono Environmental Laboratories while testing for mold in the home. [N.T., p. 232] Although Mr. Neill did not disagree with Pocono’s methodology, he said that he would have taken multiple five-minute samples to characterize “an exposure to any significant degree.” [N.T., p. 232] Both experts confirmed that in Pennsylvania, there are no guidelines regarding maximum exposure limits for mold.

Regarding causation, defendant disputed that Dr. Joel Laury could opine, within a reasonable degree of medical certainty, that plaintiff had an allergy to a certain type of mold where plaintiff presented no generally accepted scientific evidence of unacceptable levels of mold exposure within a home. In support of her contention, defendant relies on the case of Grady v. Frito-Lay, Inc., 576 Pa. 546, 839 A.2d 1038 (2003). In Grady, a consumer brought a products liability action against a tortilla chip manufacturer after suffering an esophageal tear. In deciding whether to exclude an expert witnesses’ testimony, the Pennsylvania Supreme Court cited the Frye test, which was adopted in Pennsylvania in the case of Com. V Topa, 471 Pa. 223, 369 A.2d 1277 (1977). Under the Frye test, scientific evidence “is admissible if the methodology that underlies the evidence has general acceptance in the relevant scientific community.” Grady, 576 Pa. at 555, 839 A.2d at 1044. (citation omitted). This test is used to help courts determine when scientific evidence is reliable and should be admitted into evidence.

We are mindful, however, that the admission of expert testimony lies within the discretion of the trial court. Blum v. MerrellDow Pharmaceuticals, Inc., 705 A.2d 1314, 1319 (Pa. Super. 1997) (citation omitted). Pa. R.E. 702 defines the proper occasion for admitting expert testimony.

If scientific, technical or other specialized knowledge beyond that possessed by a layperson will assist the trier of fact to understand the evidence or to determine a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training or education may testify thereto in the form of an opinion or otherwise. In Miller v. Brass Rail Tavern, Inc., 541 Pa. 474, 480-481, 664 A.2d 525, 528 (1995), the Supreme Court stated that [t]he standard for qualifications of an expert witness is a liberal one. The test to be applied when qualifying an expert witness is whether the witness has any reasonable pretension to specialized knowledge on the subject under investigation. If he does, he may testify and the weight to be given to such testimony is for the trier of fact to determine. It is also well established that a witness may be qualified to render an expert opinion based on training and experience, (citations omitted) (emphasis in original)

The court, under this liberal framework, admitted Dr. Joel Laury to testify as an expert witness.

Defendant claims that plaintiff offered no proof to establish the link between her exposure to a certain amount of mold and any resulting health problems to establish a right to recovery. Defendant argues that the Frye test requires plaintiff to prove that the scientific community generally accepts the premise that plaintiff’s illness could have been caused by exposure to the type and amount of mold presented in this case. Defendant contends that since plaintiff presented no testimony regarding generally accepted amounts of mold, the types of mold that can exist safely, or that a particular level of mold is harmful, plaintiff’s case must fail.

We find that defendant fails to appreciate that it is the admissibility of a scientific principle and not the conclusion based on that principle which is governed by Frye. The Frye test governs the admissibility of testimonial evidence, not the conclusion to be drawn therefrom. At trial Dr. Laury testified that the measurements taken by Pocono Environmental Laboratories were significant and revealed no evidence of any outdoor Aspergillus or Pentium Penicillium mold species. [Notes of Videotape Testimony of Joel Jerome Laury, M.D., June 2, 2010, (Video N.T.) p.25-26] He noted the levels inside the home of Aspergillus or Penicillium species was 1,748 counts per cubic meter. [Video N.T., p. 26] It was reasonable for him to conclude that plaintiff was breathing these species inside the home and not outside the home, where no species were found. [Video N.T., p. 25-26] Dr. Laury concluded, within a reasonable degree of medical certainty, that plaintiff’s asthma exacerbation was due to her exposure in the home to allergens. [Video N.T., p. 29-30] This testimony, accepted by the jury, was sufficient to justify a finding that plaintiff presented enough evidence to link plaintiff’s exposure to the mold and her subsequent illness.

As stated above, the Frye test governs the admissibility of the testimonial evidence, not Dr. Laury’s conclusions. If defendant wanted to challenge the admissibility of Dr. Laury’s testimony under Frye, she should have requested a Frye hearing before trial. At the hearing, defendant would have been free to argue that the proposed testimony of Dr. Laury was not generally accepted within the scientific community. Defendant did not request this hearing and, in fact, offered testimony that relied on the same scientific principles he now claims are not generally accepted. Defendant’s expert testified that Pocono Environmental Laboratories did not identify Aspergillus fumigatus in its report which was the basis for Dr. Lauiy’s expert medical opinion. [N.T., p. 240] However, he further stated that a finding of Aspergillus could include Aspergillus fumigates. [N.T., p. 240] The experts reached opposite conclusions regarding the mold found in plaintiff’s home, and the jury was free to consider the proper weight to give to the conclusion set forth by each expert.

We find nothing in the transcript or record to undermine our previous decision to admit Dr. Laury as a causation expert under the Frye test. In viewing the evidence in the light most favorable to the plaintiff as the verdict winner, and giving her the benefit of all reasonable inferences, we do not believe that two reasonable minds could disagree with the verdict as rendered. The defendant’s request for judgment notwithstanding the verdict is denied.

Next, defendant requests a new trial because the evidence favored a finding in her favor. She argues that the only conflicting evidence at trial was the contradictory testimony of Dr. Laury and Mr. Neill. Additionally, since there was no testimony contradicting the efforts defendant took to remediate the mold in the home prior to plaintiff’s occupancy, no evidence of a breach of the standard of care, or that there was mold causing plaintiff’s symptoms, Defendant argues there was insufficient evidence to find defendant negligent.

Our Superior Court has outlined the standard of review in determining whether a verdict is against the weight of the evidence:

A new trial based on the weight of the evidence issues will not be granted unless the verdict is so contrary to the evidence as to shock one’s sense of justice; a mere conflict in testimony will not suffice as grounds for a new trial. Upon review, the test is not whether this court would have reached the same result on the evidence presented, but, rather, after due consideration of the evidence found credible by the jury, and viewing the evidence in the light most favorable to the verdict winner, whether the court could reasonably have reached its conclusion. Our standard of review in denying a motion for a new trial is to decide whether the trial court committed an error of law which controlled the outcome of the case or committed an abuse of discretion. Winschel v. Jain, 925 A.2d 782, 788 (Pa. Super. 2007). (quotation and citation omitted)

At trial, Steven Wallace testified as a fact witness regarding the mold in the home at the end of October 2006. [N.T., p. 29] Defendant testified that she hired Mr. Wallace to come out to look at the mold on her property. [N.T., p. 36] Mr. Wallace sent a letter to defendant and stated that he observed mold at the floor level up to as high as foui feet. [N.T., p. 36] Defendant also testified about the steps taken to remove the mold. [N.T., p. 36-39] Mary Czekaj-Builusc, defendant’s realtor, testified she was in and out of the home and told defendant about an issue of mold in one closet. [N.T., p. 217] However, she did not notice any odd smells or other problems in the home. [N.T., p. 218]

The court instructed the jury to weigh the evidence in accordance with the preponderance of the evidence standard and gave them the standard instruction regarding negligence. In weighing the evidence, we also instructed the jury to determine the credibility of each witness. In a negligence case, as in other actions, the jury is charged with fact finding and credibility assessments. Winschel, supra at 788. The fact finder is free to accept or reject the credibility of both expert and lay witnesses, and to believe all, part or none of the evidence. Nemirovsky v. Nemirovsky, 776 A.2d 988 (Pa. Super. 2001). The jury is entitled to reject any and all evidence up until the point at which the verdict is so disproportionate to the uncontested evidence as to defy common sense and logic. Neison v. Hines, 539 Pa. 516, 521, 653 A.2d 634, 637(1995).

The jury listened to the evidence and carefully deliberated before reaching their verdict. Based on the evidence presented, the jury acted well within its purview in determining the facts in this matter, including the credibility of the witnesses. We do not find the jury’s verdict shocked our sense of justice.

Finally, defendant requests a new trial because the jury verdict was erroneously assessed or excessive. In Pennsylvania, “[i]t is well settled that the grant of a new trial is a matter within the discretion of the trial court.” Kiser v. Schulte, 538 Pa. 219, 225, 648 A.2d 1, 3 (Pa. 1994) (citations omitted). “A jury verdict is set aside as inadequate when it appears to have been the product of passion, prejudice, partiality, or corruption, or where it clearly appears from uncontradicted evidence that the amount of the verdict bears no reasonable relation to the loss suffered by the plaintiff.” Kiser, supra 538 at 225, 648 A.2d at 4 (citations omitted). A jury’s verdict will be deemed inadequate and a new trial ordered where it “is so contrary to the evidence as to ‘shock one’s sense of justice...’” Id. “It is the province of the jury to assess the worth of the testimony and to accept or reject the estimates given by the witnesses.” Id. “If the verdict bears a reasonable resemblance to the proven damages, it is not the function of the court to substitute its judgment for the jury’s.” Id. (citation omitted)

Instantly, defendant argues that the jury was clearly confused on the measure of damages. She contends that the jury requested guidance from the court regarding damages and the inquiry and resulting award demonstrate that the jury did not grasp how to measure and award damages. Plaintiff complained of difficulty breathing and shortness of breath. [N.T., p. 116] She was admitted to the hospital for “about a week.” [N.T., p. 122] Dr. Laury testified that plaintiff suffered an asthma exacerbation which caused plaintiff to end up in the hospital with “potentially life-threatening asthma exacerbation.” [Video N.T., p. 27] While the jury may have requested guidance on the assessment of damages, we will not substitute our judgment on damages for that of the jury’s. Based on the evidence presented, we cannot say the jury’s verdict shocked our sense of justice. While it may have been a high award for this county, the jury was free to determine the amount of damages. Consequently, we deny defendant’s motion for post trial relief.

In light of the foregoing, we enter the following order:

ORDER

And now, October 28, 2010, defendant Arlene Cohen’s motion for post-trial relief is denied.

       See Frye v. United States, 54 App. D.C. 46, 293 F. 1013 (1923).