Century Sur. Co. v. Essington Auto Ctr., LLC , 2016 Pa. Super. 101 ( 2016 )

J-A08038-16
2016 PA Super 101CENTURY SURETY COMPANY, : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
v. :
:
ESSINGTON AUTO CENTER, LLC, :
ROBERT NGUYEN, CUONG UNG, TRONG :
TRUONG, DAVIS NGUYEN, MICHAEL :
CONCILIO AND STEVE PASQUALINO, :
:
APPEAL OF: ESSINGTON AUTO CENTER, :
LLC AND ROBERT NGUYEN : No. 1841 EDA 2015
Appeal from the Order Entered May 18, 2015
in the Court of Common Pleas of Philadelphia County
Civil Division at No(s): November Term, 2014 No. 002283
CENTURY SURETY COMPANY, : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
v. :
:
ESSINGTON AUTO CENTER, LLC, :
ROBERT NGUYEN, CUONG UNG, TRONG :
TRUONG, DAVIS NGUYEN, MICHAEL :
CONCILIO AND STEVE PASQUALINO, :
:
APPEAL OF: DAVIS NGUYEN AND :
TRONG TRUONG : No. 1887 EDA 2015
Appeal from the Order Entered May 18, 2015
in the Court of Common Pleas of Philadelphia County
Civil Division at No(s): November Term, 2014 No. 002283
CENTURY SURETY COMPANY, : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
v. :
:
ESSINGTON AUTO CENTER, LLC, :
ROBERT NGUYEN, CUONG UNG, TRONG :
TRUONG, DAVIS NGUYEN, MICHAEL :
CONCILIO AND STEVE PASQUALINO, :
:
APPEAL OF: DAVIS NGUYEN : No. 1891 EDA 2015
J-A08038-16
Appeal from the Order Entered June 2, 2015
in the Court of Common Pleas of Philadelphia County
Civil Division at No(s): November Term, 2014 No. 002283
BEFORE: BOWES, OLSON, and STRASSBURGER,* JJ.
OPINION BY: STRASSBURGER, J. FILED MAY 18, 2016
Essington Auto Center, LLC (Essington) and Robert Nguyen (Robert)
appeal from the order entered on May 18, 2015, which granted judgment on
the pleadings against them and in favor of Century Surety, LLC. Davis
Nguyen (Davis) and Trong Truong (Truong) also appeal from the order
entered on May 18, 2015, which granted judgment on the pleadings against
them and in favor of Century Surety. Additionally, Davis appeals from the
order entered on June 2, 2015, which denied his motion for reconsideration
in the nature of a motion to strike or open a default judgment.1 After careful
review, we reverse both the May 18, 2015 order granting Century Surety’s
1
We are cognizant that an appeal does not lie from the denial of a motion
for reconsideration. See Erie Ins. Exch. v. Larrimore, 987 A.2d 732, 743
(Pa. Super. 2009) (“Denial of reconsideration is not subject to appellate
review.”). However, in this instance, it is clear that the motion for
reconsideration was, in actuality, a petition to open or strike the default
judgment; the denial of which creates an appealable order. See Keller v.
Mey, 67 A.3d 1, 3 (Pa. Super. 2013) (“Although orders of court denying
motions to strike or petitions to open default judgments are interlocutory,
Pennsylvania Rule of Appellate Procedure 311 provides that ‘[a]n appeal
may be taken as of right … from [ ] [a]n order refusing to open, vacate or
strike off a judgment.’”).
*Retired Senior Judge assigned to the Superior Court.
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motion for judgment on the pleadings as to all defendants, as well as the
order denying Davis’ motion to open the default judgment, and remand for
proceedings consistent with this opinion.
We provide the following background. Essington, located in
Philadelphia, Pennsylvania, describes its business as an “auto body shop and
painting with used auto sales.” Complaint, 11/20/2014, at Exhibit A. Robert
and Cuong Ung (Ung) are two of the officers of the company.
On August 30, 2012, Michael Concilio and Steve Pasqualino were
passengers in a vehicle being driven by Davis and owned by Truong.2 While
Davis was exiting the Essington lot and pulling into traffic, he collided with a
tow truck. Concilio and Pasqualino sustained injuries as a result of this
accident and filed personal injury actions in the Court of Common Pleas of
Philadelphia County against numerous individuals and entities, including
2
Whether Davis and Truong were employees of Essington at the time of the
accident appears to be a central disputed issue, in this case. In his workers’
compensation case, Davis testified that he was an employee of Essington at
the time of the accident and produced pay stubs and work orders to support
this contention. Conversely, at a deposition in the underlying action, Davis
testified that he had never been employed at Essington.
With respect to Truong, Robert informed Century Surety that Truong
was an employee of Essington at the time of the accident and owned the
automobile involved in the accident. However, in his brief on appeal, Truong
asserts that he “was never, at any point, an employee of Essington Auto.”
Davis/Truong’s Brief at 6.
Moreover, the complaints in the underlying cases do not make clear
exactly what Concilio and Pasqualino were doing at Essington at the time
they became passengers in this vehicle.
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Davis, Essington, Ung, Robert, and Truong. All parties requested that
Century Surety provide insurance coverage for this accident pursuant to a
Garage Liability Policy issued by Century Surety.
The policy provides liability coverage in the following amounts for the
following categories: 1) Each Accident Garage Operations Auto Only -
$1,000,000; (2) Each Accident Garage Operations Other Than Auto Only -
$1,000,000; and (3) Aggregate Garage Operations Other Than Auto Only -
$2,000,000. Complaint, 11/20/2014, at Exhibit A. These coverage amounts
apply only to accidents involving “garage operations,” a term which is
defined in the policy as
the ownership, maintenance or use of locations for garage
business and that portion of the roads or other accesses that
adjoin these locations. “Garage operations” includes the
ownership, maintenance or use of the “autos” indicated in
Section I of the coverage form as covered “autos”. “Garage
operations” also include all operations necessary or incidental to
a garage business.
Id.On November 20, 2014, Century Surety filed a complaint in
declaratory judgment against Essington, Robert, Davis, Truong, and Ung
seeking a determination of its rights and responsibilities under this policy. 3
3
Concilio and Pasqualino are also defendants in this action pursuant to Vale
Chemical Company v. Hartford Accident and Indem. Co., 516 A.2d 684(Pa. 1986). “In Vale, our Supreme Court held that the jurisdictional
requirements of the Declaratory Judgments Act with respect to joinder of
indispensable parties were not satisfied where the tort plaintiff was not
joined in the declaratory judgment action between an insurance company
and the defendant in the underlying tort action.” Titeflex Corp. v. Nat’l
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Century Surety invoked the reduced liability limits endorsement, which limits
coverage for an insured driver who is under the age of 21 to the basic
financial responsibility required by the state in which the accident occurs. 4
Complaint, 11/20/2014, at Exhibit A. Thus, Century Surety sought
declaration that its coverage be limited to these amounts.
Century Surety was able to serve all parties except Davis with this
complaint. On December 17, 2014, Attorney Andrew Riemenschneider
entered his appearance on behalf of Essington and Truong. On March 11,
2015, Attorney Riemenschneider entered his appearance on behalf of
Robert.
Century Surety filed a motion to permit alternate service upon Davis
by posting on premises pursuant Pa.R.C.P. 430. The motion averred that
service was attempted on Davis at a Chester Springs, Pennsylvania address
three times in December 2014.5 The motion further averred that a search
for addresses for Davis revealed that Chester Springs address as his only
address and no change of address was filed with the U.S. Postal Service.
Union Fire Ins. Co. of Pittsburgh, PA, 88 A.3d 970, 977 (Pa. Super.
2014) (internal quotation marks omitted).
4
Davis was 20 years old at the time of the accident, which occurred in
Pennsylvania, and therefore Century Surety suggested coverage was limited
to $15,000 per person or $30,000 per accident.
5
At his deposition in the underlying action, Davis testified that he resided at
this Chester Springs, Pennsylvania address.
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Thus, Century Surety requested service by posting on the Chester Springs
property. The trial court granted the motion on January 16, 2015.
On March 19, 2015, default judgment was entered with respect to
Ung.6 On March 19, 2015, default judgment was also entered with respect
to Davis.
On March 23, 2015, Robert, Truong, and Essington filed an answer to
the complaint for declaratory judgment. That answer included new matter,
which stated, in relevant part, that “the endorsement is inapplicable as the
accident in question did not [involve] ‘garage operations’ as defined in the
policy of insurance.” Answer, 3/23/2015, at ¶ 52. They further stated that
“[i]nasmuch as this accident did not involve ‘garage operations’, as defined
by [the] policy of insurance, it is inapplicable and unenforceable and [they]
should be afforded liability coverage in the amount of $1,000,000.00 which
is what [they] bargained for and paid premiums consistent with this level of
liability coverage.” Id.Century Surety filed a response to the new matter asserting that the
trial court should declare that Century Surety has no obligation to defend or
indemnify to Robert, Truong, or Essington for this accident because they
admitted that “the accident did not result from ‘garage operations.’” Reply to
New Matter, 4/1/2015, at 2. Century Surety then filed a motion for
6
Ung never filed an answer to the complaint, and the default judgment
entered as to Ung has not been challenged.
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judgment on the pleadings on the basis of this admission. In that motion,
Century Surety acknowledged the following:
The information provided to Century Surety prior to the filing of
the Complaint indicated that the claim may have arisen from
Essington’s “garage operations.” As such, in the declaratory
judgment complaint, Century Surety did not seek a declaration
that the policy did not provide any coverage at all for the
underlying claims. However, when Essington [] admitted in their
New Matter that the accident at issue did not arise from
[Essington’s] “garage operations”, Century Surety filed a
response accepting that admission and seeking a declaration of
no coverage.
Motion for Judgment on the Pleadings, 4/16/2015, at n.2.
On May 18, 2015, the trial court granted Century Surety’s motion for
judgment on the pleadings as to all defendants, including Davis who was not
involved in that motion. On May 21, 2015, Attorney John Livingood entered
his appearance on behalf of Davis and Truong.7
Davis filed a motion for reconsideration of the May 18, 2015 order.
Davis asserted that the trial court erred in permitting alternate service for
Davis because Davis was a participating defendant, represented by counsel,
in the underlying action and counsel was never contacted by counsel for
Century Surety about the declaratory judgment action. Davis also asserted
that he should not be bound by the admissions made by Essington and
Robert; and therefore, the trial court should reconsider the motion for
7
Initially, Attorney Reimenschneider entered his appearance in this case on
Truong’s behalf. On appeal, Truong is represented by Attorney Livingood
only. However, the record does not show that Attorney Riemenschneider
ever withdrew his appearance for Truong.
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judgment on the pleadings as to him. Davis also requested, utilizing these
aforementioned reasons, that the trial court strike or open the default
judgment entered against him.
On June 2, 2015, the trial court denied Davis’ motion for
reconsideration in the nature of a motion to open or strike the default
judgment. Robert and Essington timely appealed from the grant of the
motion for judgment on the pleadings entered against them and in favor of
Century Surety. Davis and Truong also appealed timely from that order.
Davis also filed a notice of appeal from the denial of his petition to open
default judgment.8 The trial court did not order Pa.R.A.P. 1925(b)
statements, but did author opinions in this case.
We first consider the appeal filed by Essington and Robert, who argue,
inter alia, that the trial court erred in granting the motion for judgment on
the pleadings on the basis of the purported judicial admission set forth in
their answer and new matter. For example, Essington and Robert point out
that Century Surety pled in their complaint that coverage was available,
which is also a judicial admission, and cannot later be contradicted.
Robert/Essington Brief at 10.
We begin by noting our well-settled standard of review for
judgment on the pleadings.
Entry of judgment on the pleadings is permitted
under Pennsylvania Rule of Civil Procedure 1034,
which provides that “after the pleadings are closed,
8
On July 22, 2015, this Court sua sponte consolidated these three appeals.
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judgment on the pleadings on the basis of this admission. In that motion,
Century Surety acknowledged the following:
The information provided to Century Surety prior to the filing of
the Complaint indicated that the claim may have arisen from
Essington’s “garage operations.” As such, in the declaratory
judgment complaint, Century Surety did not seek a declaration
that the policy did not provide any coverage at all for the
underlying claims. However, when Essington [] admitted in their
New Matter that the accident at issue did not arise from
[Essington’s] “garage operations”, Century Surety filed a
response accepting that admission and seeking a declaration of
no coverage.
Motion for Judgment on the Pleadings, 4/16/2015, at n.2.
On May 18, 2015, the trial court granted Century Surety’s motion for
judgment on the pleadings as to all defendants, including Davis who was not
involved in that motion. On May 21, 2015, Attorney John Livingood entered
his appearance on behalf of Davis and Truong.7
Davis filed a motion for reconsideration of the May 18, 2015 order.
Davis asserted that the trial court erred in permitting alternate service for
Davis because Davis was a participating defendant, represented by counsel,
in the underlying action and counsel was never contacted by counsel for
Century Surety about the declaratory judgment action. Davis also asserted
that he should not be bound by the admissions made by Essington and
Robert; and therefore, the trial court should reconsider the motion for
7
Initially, Attorney Reimenschneider entered his appearance in this case on
Truong’s behalf. On appeal, Truong is represented by Attorney Livingood
only. However, the record does not show that Attorney Riemenschneider
ever withdrew his appearance for Truong.
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6/5/2015, at 2. We conclude that such a narrow reading of this new matter
by the trial court was reversible error.
In its complaint for declaratory judgment, Century Surety stated the
following:
11. Upon information and belief, it is alleged that at the time of
the accident, Davis Nguyen was an employee of Essington Auto
and was driving a vehicle owned by Trong Truong, an Essington
employee on business related to Essington Auto’s operations at
the time of the accident.
12. The Policy provides coverage for anyone using, with
Essington Auto’s permission, a covered “auto” which Essington
Auto hires or borrows, and also provides coverage for employees
while using a covered “auto” that Essington does not own, hire,
or borrow when being used in Essington’s business. []
13. However, the Policy contains an endorsement that limits
coverage for an insured driver under the age of 21 to the basic
financial responsibility limit required by the state in which the
“accident” occurs. []
17. There is a real, substantial and justiciable issue in
controversy between the parties hereto with respect to the policy
limit of insurance coverage for the underlying actions under the
policy of insurance issued by Century Surety to Essington Auto.
Complaint, 11/20/2014.
Essington, Robert, and Truong responded to averments 11 and 17 by
admitting them. They denied averments 12 and 13 because “[t]he policy of
insurance is a written document which speaks for itself.” Answer, 3/23/2015,
at ¶¶ 12 and 13.
The new matter provided the following:
52. To the extent that the endorsement in question is
enforceable and not contrary to public policy, the endorsement is
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inapplicable as the accident in question did not involve[] “garage
operations” as defined in the policy of insurance. By way of
further answer, “garage operations” is a defined term which
means the ownership, maintenance or use of locations for
garage business and that portion of the roads or other accesses
that join these locations. Inasmuch as this accident did not
involve a “garage operations,” as defined by [Century
Surety’s] policy of insurance, it is inapplicable and
unenforceable and defendants should be afforded liability
coverage in the amount of $1,000,000.00 which is what
the defendants bargained for and paid premiums
consistent with this level of liability coverage.
Id. at 5 (emphasis added).
The following summarizes the standard under which a trial court may
consider a judicial admission.
For an averment to qualify as a judicial admission, it must
be a clear and unequivocal admission of fact. Judicial
admissions are limited in scope to factual matters otherwise
requiring evidentiary proof, and are exclusive of legal theories
and conclusions of law. The fact must have been unequivocally
admitted and not be merely one interpretation of the statement
that is purported to be a judicial admission. Jones v.
Constantino, [] 631 A.2d 1289, 1293–94 ([Pa. Super.] 1993)
(finding no admission where “the evidence could be reasonably
construed to admit of more than one meaning”). An admission
is not conclusively binding when the statement is indeterminate,
inconsistent, or ambiguous. Greater Valley Terminal Corp. v.
Goodman, [] 176 A.2d 408, 410 ([Pa.] 1962); Dible v. Vagley,
[] 612 A.2d 493, 499 ([Pa. Super.] 1992) (finding no admission
in a statement in which “pronouns are burdened with ambiguous
antecedents, and syntax is opaque” and that “to be an
admission, a statement must at least be intelligible [and its]
subject matter … readily determinable”). When there is
uncertainty surrounding a conceded fact, it is the role of the
judge or jury as fact finder to determine which facts have been
adequately proved and which must be rejected.
John B. Conomos, Inc. v. Sun Co. (R&M), 831 A.2d 696, 713 (Pa. Super.
2003) (some citations omitted).
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This Court applied the above principles in Cogley v. Duncan, 32 A.3d
1288 (Pa. Super. 2011). In that case, the issue before the trial court was
whether the complaint was filed before the statute of limitations had run.
Cogley admitted that he filed the complaint on June 3, 2009, after the
statute expired. However, the trial court concluded that “[b]ecause ‘file’ has
a legal meaning, [Cogley’s] ‘admissions’ that he ‘filed’ the complaint on June
3, 2009, are not binding admissions of fact.” Id. at 1293. “Only a court may
determine whether a party has filed a complaint by interpreting and applying
the relevant Pennsylvania rules of civil procedure, statutes, and other legal
authority.” Id.Similarly, a determination about whether the automobile was involved
in “garage operations” is a legal conclusion, as it requires the interpretation
of a contract. See Humberston v. Chevron U.S.A., Inc., 75 A.3d 504, 509
(Pa. Super. 2013) (“The interpretation of any contract is a question of
law.”). Accordingly it is not a fact that can be admitted or denied.
Moreover, even if “garage operations” did not require a legal
conclusion, the paragraph referenced above in the Essington/Robert/Truong
answer and new matter is confusing and contradictory. While the first part
of this paragraph, the part upon which both the trial court and Century
Surety rely, does say that the accident did not involve “garage operations,”
the second part of the paragraph states that if the accident did not involve
garage operations, the full policy limits should apply. When reading the new
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matter in conjunction with the answer as a whole, it becomes apparent the
statement about “garage operations” is not an unequivocal statement.
Accordingly, we hold the trial court erred by deeming it a judicial admission
and granting Century Surety’s motion for judgment on the pleadings on this
basis. Thus, we reverse the order as to all defendants.9
We now turn to the issues presented on appeal by Davis related to the
denial of his motion for reconsideration in the nature of a motion to strike or
open the default judgment. Davis argues, inter alia, that the trial court
erred in granting Century Surety’s motion for alternative service, and
because of that error, Davis was not served properly, did not receive notice
of the case, and the default judgment should be opened.
[A] petition to open a judgment is an appeal to the
equitable powers of the court. It is committed to the
sound discretion of the hearing court and will not be
disturbed absent a manifest abuse of that discretion.
Ordinarily, if a petition to open a judgment is to be
successful, it must meet the following test: (1) the
petition to open must be promptly filed; (2) the
failure to appear or file a timely answer must be
excused; and (3) the party seeking to open the
judgment must show a meritorious defense....
[Mother’s Restaurant, Inc. v. Krystkiewicz, 861 A.2d 327,
336 (Pa. Super. 2004) (en banc)] quoting Cintas Corp. v. Lee’s
Cleaning Services, Inc., [] 700 A.2d 915, 918–919 ([Pa.]
1997). “We need not, however, engage in the above analysis if
9
Because the trial court granted the motion for judgment on the pleadings
against all parties on this basis, we need not consider the separate argument
raised by Davis that the order should be reversed as to him because he
should not have been bound by the purported admission of Essington,
Robert, and Truong.
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6/5/2015, at 2. We conclude that such a narrow reading of this new matter
by the trial court was reversible error.
In its complaint for declaratory judgment, Century Surety stated the
following:
11. Upon information and belief, it is alleged that at the time of
the accident, Davis Nguyen was an employee of Essington Auto
and was driving a vehicle owned by Trong Truong, an Essington
employee on business related to Essington Auto’s operations at
the time of the accident.
12. The Policy provides coverage for anyone using, with
Essington Auto’s permission, a covered “auto” which Essington
Auto hires or borrows, and also provides coverage for employees
while using a covered “auto” that Essington does not own, hire,
or borrow when being used in Essington’s business. []
13. However, the Policy contains an endorsement that limits
coverage for an insured driver under the age of 21 to the basic
financial responsibility limit required by the state in which the
“accident” occurs. []
17. There is a real, substantial and justiciable issue in
controversy between the parties hereto with respect to the policy
limit of insurance coverage for the underlying actions under the
policy of insurance issued by Century Surety to Essington Auto.
Complaint, 11/20/2014.
Essington, Robert, and Truong responded to averments 11 and 17 by
admitting them. They denied averments 12 and 13 because “[t]he policy of
insurance is a written document which speaks for itself.” Answer, 3/23/2015,
at ¶¶ 12 and 13.
The new matter provided the following:
52. To the extent that the endorsement in question is
enforceable and not contrary to public policy, the endorsement is
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inapplicable as the accident in question did not involve[] “garage
operations” as defined in the policy of insurance. By way of
further answer, “garage operations” is a defined term which
means the ownership, maintenance or use of locations for
garage business and that portion of the roads or other accesses
that join these locations. Inasmuch as this accident did not
involve a “garage operations,” as defined by [Century
Surety’s] policy of insurance, it is inapplicable and
unenforceable and defendants should be afforded liability
coverage in the amount of $1,000,000.00 which is what
the defendants bargained for and paid premiums
consistent with this level of liability coverage.
Id. at 5 (emphasis added).
The following summarizes the standard under which a trial court may
consider a judicial admission.
For an averment to qualify as a judicial admission, it must
be a clear and unequivocal admission of fact. Judicial
admissions are limited in scope to factual matters otherwise
requiring evidentiary proof, and are exclusive of legal theories
and conclusions of law. The fact must have been unequivocally
admitted and not be merely one interpretation of the statement
that is purported to be a judicial admission. Jones v.
Constantino, [] 631 A.2d 1289, 1293–94 ([Pa. Super.] 1993)
(finding no admission where “the evidence could be reasonably
construed to admit of more than one meaning”). An admission
is not conclusively binding when the statement is indeterminate,
inconsistent, or ambiguous. Greater Valley Terminal Corp. v.
Goodman, [] 176 A.2d 408, 410 ([Pa.] 1962); Dible v. Vagley,
[] 612 A.2d 493, 499 ([Pa. Super.] 1992) (finding no admission
in a statement in which “pronouns are burdened with ambiguous
antecedents, and syntax is opaque” and that “to be an
admission, a statement must at least be intelligible [and its]
subject matter … readily determinable”). When there is
uncertainty surrounding a conceded fact, it is the role of the
judge or jury as fact finder to determine which facts have been
adequately proved and which must be rejected.
John B. Conomos, Inc. v. Sun Co. (R&M), 831 A.2d 696, 713 (Pa. Super.
2003) (some citations omitted).
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J-A08038-16
This Court applied the above principles in Cogley v. Duncan, 32 A.3d
1288 (Pa. Super. 2011). In that case, the issue before the trial court was
whether the complaint was filed before the statute of limitations had run.
Cogley admitted that he filed the complaint on June 3, 2009, after the
statute expired. However, the trial court concluded that “[b]ecause ‘file’ has
a legal meaning, [Cogley’s] ‘admissions’ that he ‘filed’ the complaint on June
3, 2009, are not binding admissions of fact.” Id. at 1293. “Only a court may
determine whether a party has filed a complaint by interpreting and applying
the relevant Pennsylvania rules of civil procedure, statutes, and other legal
authority.” Id.Similarly, a determination about whether the automobile was involved
in “garage operations” is a legal conclusion, as it requires the interpretation
of a contract. See Humberston v. Chevron U.S.A., Inc., 75 A.3d 504, 509
(Pa. Super. 2013) (“The interpretation of any contract is a question of
law.”). Accordingly it is not a fact that can be admitted or denied.
Moreover, even if “garage operations” did not require a legal
conclusion, the paragraph referenced above in the Essington/Robert/Truong
answer and new matter is confusing and contradictory. While the first part
of this paragraph, the part upon which both the trial court and Century
Surety rely, does say that the accident did not involve “garage operations,”
the second part of the paragraph states that if the accident did not involve
garage operations, the full policy limits should apply. When reading the new
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