Ogontz Plaza Partners v. Haines Eastburn Stenton ( 2019 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
OGONTZ PLAZA PARTNERS, LP, : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
:
v. :
:
:
HAINES EASTBURN STENTON : No. 1182 EDA 2018
CORPORATION :
Appeal from the Order Entered March 20, 2018,
In the Court of Common Pleas of Philadelphia County Civil Division at
No(s): January Term, 2017 No. 01266
BEFORE: BENDER, P.J.E., KUNSELMAN, J., and STEVENS*, P.J.E.
MEMORANDUM BY STEVENS, P.J.E.: FILED MAY 17, 2019
Plaintiff/Appellant, Ogontz Plaza Partners, LP, appeals from the order of
the Court of Common Pleas of Philadelphia County—Commerce Program,
sustaining Defendant/Appellee’s preliminary objections and dismissing
Appellant’s complaint with prejudice. We affirm.
The trial court sets forth the pertinent facts and procedural history as
follows:
This dispute follows sale and assignment of commercial property
in the West Oak Lane neighborhood of Philadelphia. The property
in litigation is Suite D at 7175 Ogontz Avenue. A portion of the
building has been sold by [Defendant/Appellee] Haines Eastburn
Stenton Corporation (“HESC”) to non-party buyer City View
Commercial, LLC (“CityView”), which then, before closing,
assigned all its ownership interests in the transaction to
[Assignee/Plaintiff/Appellant] Ogontz Plaza Partners, LP
(“Ogontz”).
____________________________________
* Former Justice specially assigned to the Superior Court.
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Ogontz claims HESC breached its agreement of sale with CityView
and argues this breach prejudices Ogontz as CityView’s assignee.
Ogontz claims in particular that Suite D at 7175 Ogontz Avenue
was included in a commercial Rent Roll incorporated in the original
agreement of sale but not included in the final deed.
Ogontz also claims HESC breached the agreement of sale by
failing to keep a common area inside 7175 Ogontz in good order
and repair.
***
STATEMENT OF FACTS
[Seller/Defendant/Appellee] HESC and [nonparty] buyer CityView
signed an Agreement for the Purchase and Sale of Real Estate
(“Agreement”) on an unknown date.[] Though
[Assignee/Plaintiff/Appellant] Ogontz was not a party to the
Agreement, Ogontz avers it acquired Suite D at 7175 Ogontz
Avenue and other properties at a closing on January 12, 2016.3 A
deed transferring the property from HESC to Ogontz is predated
December 28, 2015, but the deed does not mention Suite D.
3 See Amended Complaint. No averment is made on the date of
the Agreement and the copy of the Agreement attached as Exhibit
B to the Amended Complaint also fails to include a date, other
than one associated with the signature of an agent of HESC on
October 9, 2015.
The Agreement lists the following properties: (1) 7101-63 Ogontz
Avenue and (2) “Units C-3 and C-4 of that condominium located
at 7169-7171, 7175 Ogontz Avenue.”[] The commercial Rent Roll
attached to the Amended Complaint at Exhibit “14(j)” [sic]
mentions Suite D 7175 Ogontz as [a] unit with a tenant whose
lease expired on April 1, 2017.
PROCEDURAL
[Assignee/Plaintiff/Appellant] Ogontz commenced suit on January
10, 2017 by praecipe to issue writ of summons. Ogontz then filed
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a complaint on June 1, 2017 and an amended complaint on July
17, 2017. [Defendant/Appellee] HESC filed preliminary objections
on August 22, 2017. Despite [the court granting] four stipulations
giving Ogontz extensions of time to answer
[Defendant/Appellee’s] preliminary objections, [Plaintiff/Appellant
Ogontz] never responded.
***
At preliminary objection, [the trial court] sustained and dismissed
with prejudice because Ogontz’s amended complaint was fatally
vague. Deciphering Ogontz’s two breach of contract counts was
not helped by its repeated failure to respond to HESC’s preliminary
objections.[]
Trial Court Opinion, filed 9/6/18, at 1-3.
Plaintiff/Appellant Ogontz filed a Motion to Reconsider asserting that the
court’s order was premature in light of ongoing discussions between Ogontz’s
replacement counsel and HESC’s counsel aimed at “identify[ing] more
specifically the nature of the dispute and the discrepancy in the
documentation, and to rework the conveyance documents.” Ogontz’s Motion
to Reconsider, 3/29/18, at 2. According to the motion, efforts to resolve
disagreements pertaining to the scope of the conveyance had been ongoing
but were delayed because of difficulties in conducting necessary research into
the condominium’s formation history, caused in part by a past fire that
allegedly destroyed architectural drawings of the property in question.
Motion, at 2-3.
“In retrospect,” Ogontz offered, “rather than filing stipulations and not
addressing the pending preliminary objections, counsel for the Plaintiff
acknowledges that procedurally a Praecipe to Settle, Discontinue and End
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without prejudice should have been filed, thereby removing the matter from
the Court’s docket while the attempts to amicably resolve the matter remained
ongoing.” Motion, at 3. Ogontz, therefore, requested that the court vacate
the Order dismissing the matter with prejudice in favor of permitting Ogontz
to file a Praecipe to Settle, Discontinue, and End, without prejudice. On April
18, 2018, the trial court denied Ogontz’s Motion to Reconsider. This timely
appeal followed.
Plaintiff/Appellant Ogontz presents the following questions for review:
1. [Did] the trial court [err] as a matter of law in sustaining
the preliminary objections raised by Defendant [HESC]
under Pa.R.C.P. 1028(a)(4) (Demurrer) by failing to
consider all well-pleaded material facts, misperceiving well-
pleaded material facts, failing to consider and accept as
true all inferences fairly deductible therefrom, and
erroneously concluding that there were no facts that would
entitle Plaintiff to relief[?]
2. [Did the trial court], in sustaining the preliminary objections
of Defendant under other paragraphs of Pa.R.C.P. 1028,
[err] by concluding that Plaintiff “will not state a viable
claim,” and [err] by issuing an order which failed to grant
leave to file a Second Amended Complaint[?]
3. [Did] the trial court [err] in dismissing the Amended
Complaint with prejudice[?]
Appellant’s brief, at 2.
Appellant Ogontz's issues coalesce to challenge the trial court's order
sustaining Appellee HESC’s preliminary objections. Our standard of review of
this matter is well-settled:
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In reviewing a trial court's grant of preliminary objections, the
standard of review is de novo and the scope of review is plenary.
The salient facts are derived solely from the complaint and
pursuant to that standard of review, the court accepts all well-
pleaded material facts in the complaint, and all inferences
reasonably deduced therefrom must be accepted as true.
In determining whether the trial court properly sustained
preliminary objections, the appellate court must examine the
averments in the complaint, together with the documents and
exhibits attached thereto, in order to evaluate the sufficiency of
the facts averred. The impetus of our inquiry is to determine the
legal sufficiency of the complaint and whether the pleading would
permit recovery if ultimately proven. This Court will reverse the
trial court's decision regarding preliminary objections only where
there has been an error of law or abuse of discretion. When
sustaining the trial court's ruling will result in the denial of claim
or a dismissal of suit, preliminary objections will be sustained only
where the case is free and clear of doubt.
Jones v. Board of Directors of Valor Credit Union, 169 A.3d 632, 635
(Pa.Super. 2017) (citations omitted). With respect to preliminary objections
for insufficient specificity in a pleading, this Court has stated that:
[t]he pertinent question under [Pennsylvania] Rule [of Civil
Procedure] 1028(a)(3) is whether the complaint is sufficiently
clear to enable the defendant to prepare his defense, or whether
the plaintiff's complaint informs the defendant with accuracy and
completeness of the specific basis on which recovery is sought so
that he may know without question upon what grounds to make
his defense.
Rambo v. Greene, 906 A.2d 1232, 1236 (Pa.Super. 2006) (internal
quotations omitted).
“Pennsylvania is a fact-pleading state; a complaint must not only give
the defendant notice of what the plaintiff's claim is and the grounds upon
which it rests, but the complaint must also formulate the issues by
summarizing those facts essential to support the claim.” Lerner v. Lerner,
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954 A.2d 1229, 1235 (Pa.Super. 2008). The pleadings standards set forth in
Pa.R.C.P. 1019 specifically
require the pleader to disclose the material facts sufficient to
enable the adverse party to prepare his case. A complaint
therefore must do more than give the defendant fair notice of what
the plaintiff's claim is and the grounds upon which it rests. It
should formulate the issues by fully summarizing the material
facts. Material facts are ultimate facts, i.e. those facts essential
to support the claim. Evidence from which such facts may be
inferred not only need not but should not be alleged.... Allegations
will withstand challenge under [Rule] 1019(a) if (1) they contain
averments of all of the facts the plaintiff will eventually have to
prove in order to recover, and (2) they are sufficiently specific so
as to enable defendant to prepare his defense.
Id. at 1235–36 (quoting Baker v. Rangos, 324 A.2d 498, 505–06 (Pa.Super.
1974)).
A review of Ogontz’s Amended Complaint shows, first, that it satisfied
its obligation to assert ultimate facts that it possessed standing to pursue the
present claim. As such, we disagree with the learned trial court to the extent
it concludes “Ogontz made no averments at all that Buyer complied with [the
Purchase Agreement’s assignment provisions],” to the demise of Ogontz’s
claim of standing as an assignee to CityView. See Pa.R.A.P. 1925(a) Opinion,
at 3 n.6.
In fact, the Amended Complaint avers, “Ogontz Plaza made this
purchase as the assignee of CityView pursuant to an Agreement for the
Purchase and Sale of Real Estate (the “Agreement”) entered into between
CityView and HESC Corp. . . . Said assignment being oral and pursuant to
§17(i) of the Agreement.” Amended Complaint, ¶ 3. Section 17(i) of the
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Agreement of Sale specifies that “Buyer shall be entitled to, without Seller’s
prior consent, assign this Agreement to an entity formed by Buyer or its
principals prior to Closing. . . .”
Therefore, we find Ogontz sufficiently averred ultimate facts that it
became City View’s assignee prior to closing so as to, at the very least, create
a doubt regarding its standing to assert rights under the Agreement.
Sustaining of preliminary objections on this basis, therefore, was error.
An alternative basis upon which the trial court sustained preliminary
objections, however, centered on Ogontz’s claim that HESC breached its
contractual duty to deliver the “Property” as described in Section 14(j) of the
Agreement, entitled “Seller’s Representations and Warranties.” In Section
14(j), HESC represents that Exhibit 14(j) of the Agreement sets forth a “Rent
Roll” listing condominium units within the Property and the corresponding
rents charged to their respective tenants. Among the units listed is the unit
at issue in the present appeal, 7175 Ogontz Ave, Suite D, consisting of 1200
square feet.
In its Amended Petition, Ogontz claims Section 14(j) and Exhibit 14(j)
of the Agreement of Sale conferred upon it a contractual right to receive Suite
D as part of the condominium “Property” it purchased. Ogontz, however,
acknowledges that a discrepancy exists between the Exhibit 14(j) Rent Roll
and the more specific, legal description of the actual property to be conveyed
as it appeared on Page 1, Section A of the Agreement of Sale in the Agreement
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of Sale, and again in the Deed. Specifically, the latter descriptions do not
reference 7175 Ogontz Avenue, Suite D.1
Examining the Amended Complaint and its attached documents with
respect to the scope of the Property conveyed, we find it undeniable that the
primary and specific description of the property appearing in the Agreement
of Sale did not include Suite D, thus placing Ogontz on notice as to the entirety
of the subject Property. Moreover, this clear description aligned precisely with
the description of the conveyance appearing in the Deed, itself. If parties who
can read do not “read a deed put before [them] for execution, [they are] guilty
of supine negligence, which is not the subject of protection either in equity or
at law.” In re LaRocca's Trust Estate, 192 A.2d 409, 414.
To the extent Ogontz now argues that the Agreement’s Section 14
created sufficient doubt regarding whether the parties intended to include
Suite D in the Deed so as to survive the preliminary objection stage, we must
disagree. This is so because the Amended Complaint fails to articulate
ultimate facts that would bring this case outside the scope of the general rule
calling for merger of a contract in a subsequently executed deed:
____________________________________________
1 The first paragraph of the Agreement of Sale provides:
A. Buyer and Seller have entered into a Letter of Intent with
respect to the Ogontz Plaza, consisting of certain real property
located at Ogontz Plaza located at 7101-63 Ogontz Avenue, as
well as Units C-3 and C-4 of that condominium located at 7169-
7171, 7175 Ogontz Avenue in Philadelphia, Pennsylvania, as
more particularly described on the attached hereto as Exhibit
A (the “Property”).
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“The general rule, in the absence of fraud or mistake, and of an
intent to the contrary, is that an antecedent contract for the
purchase of land is merged in the deed...upon the delivery and
acceptance of the deed, there exists a ‘prima facie presumption’
of merger.” Dobkin v. Landsberg, 273 Pa. 174, 182, 116 A.
814, 817 (1922) (internal citation and quotation marks omitted).
The law presumes that delivery and acceptance of a deed
consummates the prior agreement and precludes the parties
“from looking behind the conveyance to subjects of strife
suggested by their previous...contracts”; this preclusion applies to
all parties in interest, even third parties. Id. at 185, 116 A. at
818. “When a deed has been executed in pursuance of a prior
agreement, it is prima facie evidence the latter has so merged
that no action could be maintained on any of its covenants....” Id.
at 186, 116 A. at 818.
“Merger is said to be the rule, except when the intention of the
parties is otherwise. . . .
…
The intention of the parties is evidenced by the attending
circumstances of each transaction. Dobkin, supra. “Intention of
the parties...may be shown by their declarations, acts, or conduct
at the time of execution of the agreement in question or from the
terms of the writing itself.” Dick v. McWilliams, 291 Pa. 165,
169, 139 A. 745, 746 (1927).
“While the general rule undoubtedly is that, if the agreement is
one for sale of lands, it will be presumed, in absence of an intent
to the contrary, the contract of purchase is merged in the deed. .
. .”
…
But the prima facie presumption of the law arising from the
[delivery and] acceptance of a deed is that it is the execution of
the whole contract. ... [Y]et the general rule is that a purchase is
consummated by the conveyance; after which the parties have no
recourse to each other except for imposition or fraud, or upon the
covenants in the deed.” Dobkin, supra at 184, 116 A. at 817.
Thus, “to rebut the legal presumption [of merger], the intention
to the contrary must be clear and manifest.” Id. at 185, 116 A. at
818.
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In re Mihordin, 162 A.3d 1166, 1171–72 (Pa.Super. 2017).
Here, the Amended Complaint failed to aver facts making clear and
manifest the parties’ shared intent to convey Suite D to Ogontz despite the
absence of any reference to Suite D in either the specific description of the
subject property in the Agreement of Sale or in the subsequently executed
Deed. For this reason, we agree with the trial court’s apparent application of
the general rule that the property description in the Deed controls.2
Accordingly, we find no error with the trial court’s order sustaining HESC’s
preliminary objections to Ogontz’s breach of contract claim raised in Count I
of the Amended Complaint.
Likewise, we find the trial court properly determined that Count II of the
Amended Complaint provided Ogontz with no opportunity for relief.
Specifically, Count II averred that HESC breached its contractual duty to
provide Ogontz with access to utilities, alarm, and sprinkler system located in
a portion of the Property’s basement not owned by Ogontz Plaza, but part of
the common area of the Ogontz Condominium.” The Amended Complaint,
however, refers to no provision in the Agreement to support a legal cause of
action in contract in this respect. Accordingly, we find no error with the order
sustaining preliminary objections on Count II.
For the foregoing reasons, we affirm the order entered below.
____________________________________________
2 In this regard, we note with approval the trial court’s observation that an
action sounding in property law would represent the appropriate means by
which to seek a remedy.
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Order affirmed.
P.J.E. Bender joins the Memorandum.
Judge Kunselman concurs in the result.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 5/17/19
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