Concerned Owners of Homes in London Towne Homeowners Assoc. v. London Towne Homeowners Assoc. & B. Carlise v. M. Serota ( 2021 )

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Concerned Owners of Homes in :
London Towne Homeowners :
Association :
v. :
:
London Towne Homeowners : No. 772 C.D. 2020
Association and Bennett Carlise : Argued: May 10, 2021
:
v. :
:
Matthew Serota, :
Appellant :
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge
HONORABLE MARY HANNAH LEAVITT, Judge
HONORABLE BONNIE BRIGANCE LEADBETTER, Senior Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY
JUDGE COHN JUBELIRER FILED: July 7, 2021
Matthew Serota (Serota) appeals from the July 2, 2020 Order of the Court of
Common Pleas of Allegheny County (trial court) that denied Serota’s Second
Amended Preliminary Objections to a Petition to Appoint Receiver (Second
Amended POs) and Preliminary Objections to a Complaint in Support of Petition to
Appoint a Receiver Also Seeking Dissolution of Association and Appointment of
Permanent Receiver for Winding Up Association (POs to the Complaint) (together,
Preliminary Objections).1 The Petition to Appoint Receiver (Petition) and
Complaint in Support of Petition to Appoint a Receiver Also Seeking Dissolution of
Association and Appointment of Permanent Receiver for Winding Up Association
(Complaint) were filed by the “Concerned Owners of Homes in London Towne
Homeowners Association” (Concerned Owners). Concerned Owners are unit
owners in the London Towne Community of Homes (Community) who seek to
dissolve the London Towne Homeowners Association (Association) on the basis that
it has ceased to function effectively in light of dysfunction within the Community.
Also before the Court is Concerned Owners’ Application to Quash (Application),
which asserts that Serota’s appeal should be quashed because the July 2, 2020 Order
is an interlocutory order that is not immediately appealable by either right or
permission. For the following reasons, we conclude that the trial court’s July 2, 2020
Order is interlocutory and not appealable as of right pursuant to Pennsylvania Rule
of Appellate Procedure 311(a)(2), Pa.R.A.P. 311(a)(2); we therefore grant the
Application and quash Serota’s appeal.
I. BACKGROUND
This matter represents the most recent dispute between two factions of unit
owners in the Community that has resulted in near-constant litigation between and
amongst unit owners, the Association, and Serota since 2015.2 The Association
1
The trial court also overruled the preliminary objections of the London Towne
Homeowners Association.
2
This litigation includes actions filed by Serota against the Association in or around 2015
following the Association’s October 2014 amendment to the Declaration of Covenants,
Conditions, and Restrictions to change a one-unit, one-vote provision to a one vote per owner
provision that would limit an owner of multiple units to a single vote in Association matters. Serota
prevailed in this litigation, see Serota v. London-Towne Homeowners Association (Pa. Cmwlth.,
No. 2073 C.D. 2016, filed April 27, 2017) (Serota I). Serota I begat Serota v. London-Towne
(Footnote continued on next page…)
2
governs the Community via the Declaration of Covenants, Conditions, and
Restrictions (Declaration), recorded on June 26, 1979, and the Bylaws of the
Association (Bylaws). The Community is a planned community of 70 townhomes
of which Serota owns 22. Serota does not reside in the Community. At the time of
the Petition and Complaint, Bennett Carlise (Carlise) was acting as the President of
the Association’s Executive Board (Board) and, for a period of time, served as the
only member of the Board. Some members of Concerned Owners were past Board
members. Although they were not specifically named in the Petition, the individual
owners signed the verification at the end of the Petition and, later, were specifically
identified in the Complaint.
On March 27, 2019, Concerned Owners filed the Petition3 setting forth a claim
for breach of fiduciary duty against Carlise (Count I) and a request for the
appointment of a receiver and the dissolution of the Association (Count II) based on
the following averments. Carlise was appointed to the Board on October 1, 2017,
making him the second Board member. Following the death of the other Board
member in May 2018, Carlise was the sole Board member until he appointed two
other members in June 2018, who ultimately resigned in October 2018. Concerned
Owners’ claims are based on Carlise’s: attempt to impose, in their view, an improper
special assessment; refusal to hold special meetings when requested and spending
Homeowners Association (Pa. Cmwlth., No. 1451 C.D. 2017, filed November 16, 2018) (Serota
II), which involved Serota’s attempt to have the Association and/or its officers pay his attorney’s
fees arising from Serota I. The trial court did not grant Serota’s requested relief, and we affirmed.
In 2015, the Association’s then-Executive Board attempted to enact various amendments and
changes to the Association’s Bylaws limiting the rental of units and occupancy of units by non-
owners. Serota again sued the Association, and a counter-suit was filed against Serota. This
litigation was resolved by a court-approved Limited Settlement and Release Agreement that
enjoined the restrictions and set certain limitations to the Association’s imposing future
assessments against Serota.
3
The Petition may be found at pages 9a-101a of the Reproduced Record.
3
Association funds on legal fees to determine the validity of such requests; refusal to
abide by the Bylaws’ requirements regarding the holding of timely special meetings
and allowing for unit owners’ review and rejection of the Association’s budget; and
refusal to abide by what they believe to have been valid votes regarding the
dissolution of the Association, the removal of Board members, and the cancellation
of an insurance policy that they believed was too expensive and improperly excluded
claims filed by Serota. They also questioned Carlise’s authority to act for the
Association, particularly after a majority of unit owners voted for his removal from
the Board, and his continued expenditure of Association funds on legal fees to fight
his removal from office. Concerned Owners also asserted that, because the Bylaws
require the signature of two officers on checks over $100, Carlise was improperly
issuing checks with only his signature. According to Concerned Owners, Carlise
justified his remaining on the Board by asserting that Section 5303(f) of the Uniform
Planned Community Act (UPCA), 68 Pa.C.S. § 5303(f), required a 66% vote in favor
of his removal, which was not obtained. Concerned Owners believed that this
section did not apply because the Community was created in 1979. (Petition ¶¶ 52-
66.) Concerned Owners contended that, following a September 5, 2018 vote that
removed all of the Board members, the Board has been without the authority to act.
Based on their concerns regarding the alleged mismanagement of the
Association and the lack of progress on the dissolution of the Association,
Concerned Owners filed the Petition “against Carlise to protect the majority interests
of the Association,” not just those of Carlise. (Id. ¶ 73, R.R. at 19a.) Concerned
Owners asserted that Carlise “has failed to fulfill any of the duties set forth in the
Bylaws to ensure the business of the Association was completed,” “is unable and
unauthorized to effectively manage the business of the Association,” and “has
4
breached his duties in that he has failed to act in the best interest of the Association
. . . .” (Id. ¶¶ 81-83, 85, 87.) They further argued, in support of their request for the
appointment of a receiver, that the current structure of the Association is not
sustainable because “[t]here is dissension and impasse among and between Carlise
and many [C]ommunity unit owners as to the winding up of the” Association’s
affairs, they were “unaware what, if any, assets and income of the Association [were]
being disbursed and why,” and there had been no information as to the Association’s
fiscal affairs provided to Concerned Owners since September 26, 2018. (Id. ¶¶ 74,
90-92.) Concerned Owners asserted that “[t]he balance of necessity and benefits
against injury incident to the appointment of a receiver requires such an
appointment,” and they requested an accounting of the Association’s funds. (Id.
¶¶ 94-96.) Based on these facts, Concerned Owners maintained that they had met
the standard for the appointment of a receiver under Pennsylvania law, which
requires a showing of “gross mismanagement or fraud or similar circumstances.”
(Id. ¶ 97 (quoting Tate v. Phila. Transp. Co., 190 A.2d 316, 321 (Pa. 1963)).)
The trial court heard argument on July 18, 2019, at which the parties and
Serota, who was allowed to intervene, presented their positions regarding how to
proceed. By order dated the same day, the trial court appointed Robert G. Xides, Jr.,
Esq. (Xides) “to serve as temporary receiver” and required Xides to “file a Report
and Recommendations . . . within 45 days.” (Supplemental Reproduced Record at
2b.) The trial court empowered Xides “to collect assessments and make
disbursements within the regular course of business” and directed him to hold at
least one meeting with the unit owners so that he could “adequately assess their
concerns and make recommendation in that regard.” (Id.) No immediate appeal of
the July 18, 2019 order was filed.
5
After holding two unit owner meetings and reviewing the Association’s
finances, Xides issued a report and recommendation (Report) on September 13,
2019.4 In the Report, Xides described the Association as being “in a state of turmoil
for at least the last five . . . years,” and that its continuation was “a burden rather than
a benefit to the [C]ommunity.” (Reproduced Record (R.R.) at 108a, 120a.) Xides
set forth: the general state of the Association and Community; the concerns of the
two factions; recommendations as to legal issues regarding the validity of the various
votes and actions set forth in the Petition, particularly those occurring when there
were fewer than five Board members and after the September 5, 2018 vote removing
the Board members; and a recommendation to suspend the Association’s regular
activities, as dissolution did not appear to be legally possible. As to Carlise’s
expenditure of Association funds, Xides believed those expenditures benefited the
Association.5 (Id. at 119a-20a.)
On December 10, 2019, the trial court issued an order empowering Xides to
continue to conduct the Association’s business, including “levying and collecting
assessments, making contracts for necessary services, and paying [the] obligations
of the Association as [he] in his discretion determine[s].” (Original Record (O.R.)
at Item 26.) By orders dated December 10, 2019, and January 23, 2020, the trial
4
The Report may be found at pages 102a-22a of the Reproduced Record.
5
Various exceptions and objections to the Report, and responses thereto, were filed
between September 25, 2019, and February 2020. (Original Record (O.R.) at Items 14, 20-21, 41,
43-44.) In addition, both Serota and the Association/Carlise have filed various applications for
special relief related to Xides’ appointment and motions to vacate or strike the appointment
between September 26, 2019, and January 2020, to which Concerned Owners replied. (O.R. at
Items 13, 15, 18, 38-39, 46-47.) It appears that hearings on the motions and applications have
occurred, but it is unclear from the trial court’s record that has been filed with the Court if any
orders have been issued to resolve them.
6
court directed that the Association pay Xides’ law firm for Xides’ services. (O.R. at
Item 27.) No appeals were filed from these orders.
On January 3, 2020, Concerned Owners filed the Complaint, asserting the
same facts as in the Petition, as well as information from the Report, and new
allegations regarding actions taken by or attempted to be taken by Carlise and Serota
after the appointment of Xides. As in the Petition, they asserted a breach of fiduciary
duty claim against Carlise (Count I), sought the court-ordered dissolution of the
Association (Count II), and requested the appointment of a permanent receiver to
wind up the Association (Count III).
On January 24, 2020, Serota filed the POs to the Complaint,6 and a day later,
filed the Second Amended POs.7 Together, the Preliminary Objections challenged:
the capacity of “Concerned Owners” to sue as it is not a legal entity that can sue, be
sued, or assume liability to pay for any receiver; the legal sufficiency of Concerned
Owners’ claim for the appointment of a permanent receiver under Tate and Bowman
v. Gum, Inc. 184 A. 258 (Pa. 1936), particularly after Xides’ Report; the legal
sufficiency of Concerned Owners’ assertions that the UPCA did not apply to the
Community and that the Association could be dissolved under the trial court’s
equitable power, particularly after Xides’ Report; and the legal sufficiency of
Concerned Owners’ request for an appointed receiver to dissolve the Association,
which would be an illegal action in light of the UPCA, the Declaration, and this
Court’s prior opinion in Serota v. London-Towne Homeowners Association (Pa.
Cmwlth., No. 2073 C.D. 2016, filed Apr. 27, 2017) (Serota I). Specific to the
6
The POs to the Complaint may be found at pages 362a-76a of the Reproduced Record.
The Association and Carlise also filed preliminary objections to the Complaint.
7
Serota filed an initial set of preliminary objections to the Petition on September 3, 2019,
and amended preliminary objections on October 1, 2019. The Second Amended POs may be found
at pages 328a-41a of the Reproduced Record.
7
Petition, Serota claimed it was improperly filed because it was not related to an
existing complaint as required by Pennsylvania Rule of Civil Procedure 1007,
Pa.R.C.P. No. 1007, and Wm. Garlick & Sons, Inc. v. Lambert, 287 A.2d 143 (Pa.
1972). Specific to the Complaint, Serota asserted that Counts II and III, seeking,
respectively, dissolution and appointment of a permanent receiver, are not valid
causes of action that can be granted and are without legal bases due to the equitable
relief requested, and that Count III is moot without Count II.8
Concerned Owners filed a single response to the Preliminary Objections,
explaining why each was without merit at this stage of the proceedings.9 They
asserted: there was no legal deficiency in using “Concerned Owners” where the
individual owners, who were identified, clearly had standing; the Petition, itself, met
the requirements for a complaint; they met the legal standards for the appointment
of the receiver, as supported by their pleadings and Xides’ Report; and they were not
seeking the dissolution of the Community but of the Association. Concerned
Owners reiterated their arguments as to the inapplicability of the UPCA to the
Community, and that the trial court has broad equitable power and, therefore, their
Counts based in equity are valid.
The trial court heard argument by the parties on June 17, 2020. There was
discussion about holding a hearing, but the trial court ultimately limited it to
argument on any motions that could be argued. (R.R. at 419a.) Serota presented
argument in support of his Preliminary Objections, followed by Concerned Owners’
8
Serota requested in the Second Amended POs that the Petition be dismissed with
prejudice, that the appointment of a temporary receiver be discontinued or vacated, and that the
individual plaintiffs pay Xides’ costs and pay the Association’s attorneys’ fees and expenses. He
requested in the POs to the Complaint that the Complaint be dismissed and that the “true” plaintiffs
be declared jointly and severally subject to counterclaims and other legal actions.
9
Concerned Owners’ response may be found at pages 394a-405a of the Reproduced
Record.
8
argument in opposition. (Id. at 419a-52a.) Following extensive argument, the trial
court denied the Preliminary Objections, noting the matter had been going on for a
year without much progress and the trial court wanted to move towards disposing of
the matter.10 (Id. at 424a, 452a.) As to other motions and applications for special
relief that sought the removal of Xides, the trial court indicated there would have to
be a hearing, which would be scheduled for another time.11 (Id. at 467a-68a.) On
July 2, 2020, the trial court issued the Order overruling Serota’s Preliminary
Objections.
Serota filed a Notice of Appeal from the July 2, 2020 Order, and the trial court
directed him to file a Concise Statement of Errors Complained of on Appeal pursuant
to Pennsylvania Rule of Pennsylvania Appellate Procedure 1925(b), Pa.R.A.P.
1925(b) (1925(b) Statement). On August 1, 2020, Serota filed an application
requesting that the trial court amend the July 2, 2020 Order to include a statement
that the Order “involves a controlling question of law as to which there is a
substantial ground for difference of opinion and that an immediate appeal from the
order may materially advance to ultimate termination of the matter” pursuant to
Section 702(b) of the Judicial Code, 42 Pa.C.S. § 702(b), so that “Serota may file a
petition for permission [to] appeal from [the] Order” pursuant to Pennsylvania Rule
of Appellate Procedure 1311, Pa.R.A.P. 1311 (addressing interlocutory appeals by
permission). (Application to Amend Order to Include Statement Specified in 42
10
The Association and Carlise also presented argument on their preliminary objections
specific to the allegations against Carlise and the dissolution of the Association, followed by
Concerned Owners’ counter arguments. (R.R. at 453a-63a.) The trial court overruled those
preliminary objections as well. (Id. at 466a.)
11
The trial court issued an order docketed July 14, 2020, directing the Association to pay
Xides’ fees. Serota appealed this order to our Court, which was docketed at 797 C.D. 2020.
However, Serota subsequently withdrew this appeal.
9
Pa.C.S. § 702(b) ¶¶ 3-4.) The trial court denied Serota’s request by order dated
August 4, 2020.
Thereafter, Serota timely filed two nearly identical 1925(b) Statements, one
for each set of preliminary objections denied, setting forth the alleged errors
committed by the trial court.12 The trial court issued its 1925(a) Opinion. After
setting forth the facts as alleged and the errors asserted by Serota, the trial court
explained it would not address the issues’ merits because, as a matter of procedure,
the appeal was invalid because the July 2, 2020 Order was interlocutory. The trial
court indicated that the appeal should be quashed pursuant to Pennsylvania Rule of
Appellate Procedure 341, Pa.R.A.P. 341, which allows for appeals only from final
orders. The trial court indicated that the July 2, 2020 Order was not appealable by
permission under Rule 1311 because the trial court had denied Serota’s application
to include the statement specified under Section 702(b) of the Judicial Code. As the
July 2, 2020 Order was not final and Serota did not have permission to appeal from
the interlocutory order, the trial court stated that this Court did not have jurisdiction
and Serota’s appeal should be quashed.
II. DISCUSSION
We must first resolve the threshold issue of whether the Court has jurisdiction
to consider the July 2, 2020 Order. Pursuant to Rule 341, this “Court has appellate
jurisdiction over ‘final orders’ of the administrative agencies or courts of common
pleas.” Rivera v. Carbon Cnty. Tax Claim Bureau, 857 A.2d 208, 212 (Pa. Cmwlth.
2004). A final order is any order that “disposes of all claims and of all parties” or
that “is entered as a final order pursuant to paragraph (c) of this rule.” Pa.R.A.P.
12
Serota’s 1925(b) Statements may be found at pages 495a-512a of the Reproduced
Record.
10
341(b). “The purpose of limiting appellate review to final orders is to prevent
piecemeal determinations and the consequent protraction of litigation.” Rivera, 857
A.2d at 212. Generally, an order overruling preliminary objections is interlocutory
and not subject to immediate appeal. Maxatawny Township v. Kutztown Borough,
113 A.3d 895, 899 n.4 (Pa. Cmwlth. 2015). Orders that are collateral or
interlocutory, which do not qualify as final orders, may be immediately appealed in
certain circumstances. Appeals from interlocutory orders may be taken by
permission under Pennsylvania Rules of Appellate Procedure 312 and 1311,
Pa.R.A.P. 312, 1311.13 However, an appeal as of right may be taken from certain
interlocutory orders pursuant to Rule 311(a).
13
Rule 312 states that interlocutory orders may be appealed in accordance with Chapter 13
of the Appellate Rules. Pa.R.A.P. 312. Rule 1311 provides, in relevant part, that:
(a) General rule.--An appeal may be taken by permission from an
interlocutory order:
(1) certified under 42 Pa.C.S. § 702(b) or for which certification pursuant to 42
Pa.C.S. § 702(b) was denied; see Pa.R.A.P. 312;
(2) for which certification pursuant to Pa.R.A.P. 341(c) was denied; or
(3) that determined that a defendant’s motion to dismiss on the basis of double
jeopardy is frivolous.
(b) Petition for permission to appeal.--Permission to appeal from an interlocutory
order listed in paragraph (a) may be sought by filing a petition for permission to
appeal with the prothonotary of the appellate court within 30 days after entry of
such order or the date of deemed denial in the trial court or other government unit
with proof of service on all other parties to the matter in the trial court or other
government unit and on the government unit or clerk of the trial court, who shall
file the petition of record in such trial court. . . .
Pa.R.A.P. 1311(a), (b).
11
This Court, by order dated October 6, 2020, directed the parties to address the
issue of the appealability of the July 2, 2020 Order in their briefs. The parties have
done so,14 and, in addition, Concerned Owners filed their Application. Concerned
Owners maintain that Serota’s appeal should be quashed because the July 2, 2020
Order was an interlocutory order that is not immediately appealable either by right
or by permission. Serota does not argue that he may appeal the July 2, 2020 Order
by permission. Rather, he now asserts that the Order is appealable as of right
pursuant to Rule 311(a)(2), which authorizes immediate appeals from orders
“confirming, modifying or dissolving or refusing to confirm, modify or dissolve an
attachment, custodianship, receivership or similar matter affecting the possession or
control of property, except for orders pursuant to” certain sections of the Divorce
Code, 23 Pa.C.S. §§ 3101-3904. Pa.R.A.P. 311(a)(2). Serota did not raise Rule
311(a)(2) as a basis for this Court’s jurisdiction before the trial court, but cited it for
the first time in his Docketing Statement filed with the Court on October 4, 2020. It
is undisputed that the July 2, 2020 Order is not a final order as defined by Rule
341(b) and is not appealable by permission in light of the denial of the Section 702(b)
amendment. Thus, for the July 2, 2020 Order to be immediately appealable, it must
fall within Rule 311(a)(2).
Concerned Owners challenge Serota’s reliance on Rule 311(a)(2), arguing
that Serota acknowledged the interlocutory nature of the July 2, 2020 Order and the
need to obtain permission to appeal, by asking for the trial court to grant that
permission by amending the July 2, 2020 Order. (Concerned Owners’ Brief (Br.) at
4-5.) Concerned Owners assert that Rule 311(a)(2), which courts apply narrowly,
does not apply to the July 2, 2020 Order based on the Rule’s plain language and
14
Carlise joins in Serota’s briefs, and the Association and Xides did not file a brief.
12
related case law. (Id. at 1-2 (citing Borough of Ambler v. Regenbogen, 713 A.2d
145, 149 (Pa. Cmwlth. 1998); Jerry Davis, Inc. v. Nufab Corp., 677 A.2d 1256, 1259
(Pa. Super. 1996);15 Rappaport v. Stein, 506 A.2d 393, 395-96 (Pa. Super. 1985)
(Rappaport I)).) Concerned Owners contend that the July 2, 2020 Order merely
overrules the Preliminary Objections and does not alter the possession or control of
property or “specifically confirm, modify, dissolve or refuse to confirm, modify, or
dissolve a receivership, attachment, [or] custodianship . . . .” (Id. at 2.) They argue
that, notwithstanding Xides’ title, his role to assess and report on the Association’s
condition and manage the Association while the case is pending is a limited
management function and does not constitute the possession or control of the
property, particularly where the title of the properties remain with the owners. (Id.
at 2-3 (citing Rappaport I, 506 A.2d at 395-96; Rappaport v. Stein, 520 A.2d 480,
482-83 (Pa. Super. 1987) (Rappaport II)).) They note that Serota did not appeal the
trial court’s July 18, 2019 order appointing Xides or the December 10, 2019 order
clarifying Xides’ authority, yet is now trying to “morph” the July 2, 2020 Order
denying the Preliminary Objections into something it is not, which does not reflect
a narrow construction of Rule 311(a)(2). (Id. at 3.)
Serota argues that the July 2, 2020 Order is immediately appealable under
Rule 311(a)(2) because the matter involves a receivership. According to Serota, he
did not have to obtain the trial court’s permission pursuant to Section 702(b) and
Rule 1311(b) because Rule 311(a)(2) allows him to immediately appeal the Order
as of right. (Serota’s Br. in Opposition at 8 (citing Jerry Davis, Inc., 677 A.2d at
1259 (applying Rule 311(a)(2) to “[o]rders involving . . . receiverships . . . or other
15
“In general, Superior Court decisions are not binding on this Court, but they offer
persuasive precedent where they address analogous issues.” Lerch v. Unemployment Comp. Bd.
of Rev., 180 A.3d 545, 551 (Pa. Cmwlth. 2018).
13
similar matters affecting the possession or control of property”)).) Serota relies on
the request in his Second Amended POs16 for the vacation and discontinuance of the
receivership sought by Concerned Owners to argue that the July 2, 2020 Order
effectively confirmed the receivership and “transferred control from the unit owners
and members . . . of the . . . Association . . . and their elected executive board . . . to
a receiver to govern and conduct the business of the Association.” (Serota’s Br. in
Opposition at 3-4; see also Serota’s Reply Br. at 2-3.) Thus, he argues this matter is
akin to White v. White (Pa. Super., No. 846 MDA 2017, filed February 8, 2018),
2018 WL 771850, and Interstate Net Bank v. Donna Jane Apartments Associates,
L.P. (Pa. Super., No. 515 EDA 2013, filed May 9, 2014), 2014 WL 10920475,
wherein the Superior Court held that there was an immediate right to appeal under
Rule 311(a)(2) under similar circumstances. (Serota’s Br. in Opposition at 8-9; see
also Serota’s Reply Br. at 3-4.) Contrary to Concerned Owners’ arguments, Serota
maintains that Xides is not merely managing the Association but is exercising
unilateral control over things that affect the unit owners’ property rights. (Serota’s
Br. in Opposition at 10; see also Serota’s Reply Br. at 5-6.) Finally, Serota asserts
that any concern regarding piecemeal litigation is misplaced because Rule 311(a)(2)
specifically authorizes immediate appeals from these types of interlocutory orders
in these limited circumstances. (Serota’s Br. in Opposition at 11-12.)
For the July 2, 2020 Order to be appealable as of right, and for this Court to
have jurisdiction, it must come within Rule 311(1)(2). Rule 311(a)(2) states that
“[a]n appeal may be taken as of right and without reference to Pa.[]R.A.P. 341(c)
from:” “(2) Attachments, etc. – An order confirming, modifying, dissolving, or
16
Although Serota claims this relief was also requested in the POs to the Complaint, a
review of that document reveals that such relief was not requested therein. (Compare R.R. at 340a-
41a, with 374a-75a.)
14
refusing to confirm, modify or dissolve an attachment, custodianship,
receivership, or similar matter affecting the possession or control of property,
except for orders pursuant to 23 Pa.C.S. §§ 3323(f), 3505” (relating, respectively, to
the issuance of injunctions and the disposition of property under the Divorce Code).
Pa.R.A.P. 311(a)(2) (bold emphasis added). We recognize that “the right to appeal
interlocutory orders has been narrowly circumscribed.” Jerry Davis, Inc., 677 A.2d
at 1258. Moreover, in construing the rules promulgated by our Supreme Court, we
use the rules of statutory construction with the object being to ascertain and
effectuate the intention of the Supreme Court. Pennsylvania Rule of Appellate
Procedure 107, Pa.R.A.P. 107; Jerry Davis, Inc., 677 A.2d at 1258. It is presumed
that there was no intent to create “a result that is absurd, impossible of execution[,]
or unreasonable.” Section 1922(1) of the Statutory Construction Act of 1972, 1
Pa.C.S. § 1922(1).
In Jerry Davis, Inc., the Superior Court interpreted Rule 311(a)(2) to
determine whether it applied to the denial of the issuance of a writ of seizure relating
to a replevin action. 677 A.2d at 1256-57. The plaintiff appealed, and the parties
argued that the order was appealable under Rule 311(a)(2). The Superior Court
disagreed, holding, based on the Rule’s plain language, that only “[o]rders involving
attachments, receiverships, custodianships or other similar matters affecting the
possession or control of property, are among the classes of interlocutory orders that
are appealable as of right.” Id. at 1259. Because an action in replevin is distinct
from the types of legal actions and remedies set forth in Rule 311(a)(2), the Superior
Court concluded that the Supreme Court did not intend orders related to a replevin
action to be immediately appealable under Rule 311(a)(2). Id. at 1259-60.
15
Serota contends that the Superior Court’s use of the word “involving” in Jerry
Davis, Inc. means that any order in litigation relating to a receivership is appealable
as of right under Rule 311(a)(2). Under that rationale, Serota contends that the July
2, 2020 Order is appealable as of right because it, in effect, confirmed Xides’
appointment by denying the Preliminary Objections and allowing the matter to
proceed. We do not read Jerry Davis, Inc. this broadly, nor do we believe it supports
Serota’s arguments. Jerry Davis, Inc. rejected an attempt to extend Rule 311(a)(2)
beyond its plain language, in that case to a seizure related to a replevin action. Here,
similarly, the Order simply denies the Preliminary Objections, thereby allowing the
underlying litigation on, among other things, the appointment of a receiver, to
proceed. Thus, Jerry Davis, Inc., which is an example of how “the right to appeal
interlocutory orders has been narrowly circumscribed,” 677 A.2d at 1258 (emphasis
added), does not support Serota’s broad reading of Rule 311(a)(2) as allowing an
immediate appeal from an order that does not fall within its plain language.
Serota relies on White and Interstate Net Bank to argue that the July 2, 2020
Order is immediately appealable under Rule 311(a)(2). However, those cases are
distinguishable because, respectively, they involved appeals from orders
specifically addressing petitions to modify/remove an appointed receiver or to
appoint a receiver in the first instance. White, slip op. at 2-3, 9, 2018 WL 771850,
at *1, 4 (finding an order denying a joint petition “seeking . . . the removal of [the
appointed] guardian/receiver” was immediately appealable because it “constitute[d]
an order refusing to modify a receivership”); Interstate Net Bank, slip op. at 2-4,
2014 WL 10920475, at *1-2 & n.2 (holding that an order appointing a temporary
receiver during the pendency of a foreclosure action was “immediately appealable
pursuant to [Rule] 311(a)(2), notwithstanding that the underlying action has not yet
16
been resolved”).17 As the July 2, 2020 Order overruling the Preliminary Objections
did not appoint, modify, or dissolve a receivership, or refuse to do any of those
things, these cases do not support Serota’s arguments.
Finally, Serota argues that the Order should be immediately appealable
because he included a request for the dissolution of Xides’ appointment in the
Second Amended POs, based on Serota’s contention that Xides is exercising
unilateral control over things that affect the unit owners’ property rights. This
argument seems to invoke the last provision of Rule 311(a)(2), providing that orders
that “affect[] the possession or control of property” are immediately appealable.
Pa.R.A.P. 311(a)(2). However, the types of limited management functions that
Xides performs are similar to those in Rappaport I and Rappaport II, which the
Superior Court found do not constitute possession or control of property.
In Rappaport I and Rappaport II, the Superior Court addressed whether orders
appointing a real estate firm to manage and later to take steps to sell investment
properties during litigation over the dissolution of real estate partnerships were
immediately appealable under Rule 311(a)(2). Relevantly, in Rappaport I, the order
authorized the real estate firm to “collect rents, make ordinary repairs, pay taxes,
insurance, utility bills and other routine and ordinary expenses,” to “rent properties
as vacancies occur,” and to “perform all the routine and customary functions of a
real estate management firm pending further [o]rders of th[e] court.” 506 A.2d at
395. The Superior Court held that the real estate firm was performing “routine
management functions” and that such “limited management function” was “not the
17
We also note that both White and Interstate Net Bank are unreported opinions filed before
May 1, 2019, and, therefore, may not be cited as persuasive authority. See Pennsylvania Rule of
Appellate Procedure 126(b), Pa.R.A.P. 126(b) (stating that unpublished decisions of the Superior
Court filed after May 1, 2019, may be cited as persuasive authority).
17
‘possession or control of property’” that would “justif[y] an exception to the
nonappealability of interlocutory orders.” Id. at 395-96. It therefore quashed the
appeal, concluding that the order did not satisfy Rule 311(a)(2)’s jurisdictional
requirement. Similarly, in Rappaport II, the order directed the real estate
management firm to “take all reasonable and appropriate steps to sell the real estate
properties of the various partnerships.” 520 A.2d at 481. The Superior Court again
quashed the appeal, reasoning that although the order expanded the firm’s function,
it did not specifically appoint the firm as a receiver or give the firm “the power
actually to consummate the sale of the properties” that would divest the partnerships’
title to the properties. Id. at 483.
The parties agree that Xides is collecting assessments, reviewing and paying
bills associated with services provided to the Community, and issuing certificates of
resale, which are similar to the routine or limited management functions found not
to “justif[y] an exception to the nonappealability of interlocutory orders.” 506 A.2d
at 395-96. Importantly, there does not appear to be any allegation that, beyond
collecting assessments from unit owners to pay for services, Xides has the authority,
or has even attempted, to divest unit owners of their title to any property.
Accordingly, Rappaport I and Rappaport II support the conclusion that the July 2,
2020 Order is not immediately appealable under Rule 311(a)(2).18
18
Although we conclude that the July 2, 2020 Order is not immediately appealable, we
note the complicated procedural background of this case, with the near constant filing of pleadings,
objections, exceptions, and motions or applications for special relief, along with numerous
arguments and hearings. Notably, notwithstanding Serota’s and Carlise’s objections to Xides’
appointment and actions, neither directly challenged that appointment in July 2019 or in December
2019, when the trial court clarified Xides’ authority. This allowed Xides to act for more than a
year before Serota appealed the July 2, 2020 Order denying POs and allowing the matter to move
forward, to this Court. Ultimately, the Court hopes that this contentious matter can be resolved
without further delay.
18
III. CONCLUSION
Ultimately, the plain language of Rule 311(a)(2) and the case law do not
support Serota’s argument that the July 2, 2020 Order is immediately appealable.
Because the Order is not immediately appealable under Rule 311(a)(2), this Court
lacks jurisdiction to consider Serota’s appeal. Accordingly, we grant the Application
and quash Serota’s appeal.
_____________________________________
RENÉE COHN JUBELIRER, Judge
19
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Concerned Owners of Homes in :
London Towne Homeowners :
Association :
v. :
:
London Towne Homeowners : No. 772 C.D. 2020
Association and Bennett Carlise :
:
v. :
:
Matthew Serota, :
Appellant :
ORDER
NOW, July 7, 2021, the Application to Quash filed by Concerned Owners of
Homes in London Towne Homeowners Association is GRANTED, and the appeal
filed by Matthew Serota is QUASHED.
_____________________________________
RENÉE COHN JUBELIRER, Judge