Robinson, K. v. LLEM Corp. ( 2015 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
KEVIN K. ROBINSON, IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellant
v.
LLEM CORPORATION AND PINNACLE
CAPITAL FUNDING,
Appellees No. 422 EDA 2014
Appeal from the Order Dated December 11, 2013
In the Court of Common Pleas of Philadelphia County
Civil Division at No(s): May Term, 2007 No: 1790
BEFORE: PANELLA, OLSON AND FITZGERALD,* JJ.
MEMORANDUM BY OLSON, J.: FILED MARCH 12, 2015
Appellant, Kevin K. Robinson, appeals from the order dated December
11, 2013 in this action to quiet title. We affirm.
The trial court set forth the facts of this case as follows:
[Appellant] borrowed money on properties he owned at
1500 and 1615 West Tioga Street, Philadelphia 19140 from
[LLEM Corporation (“LLEM”)]. [Appellant] signed deeds in
lieu of foreclosure that he agreed would be filed in the case
of default. In these transactions, Patrick Maruggi acted as
an intermediary between [Appellant] and LLEM, securing
the mortgages and deeds in lieu of foreclosure and sending
copies to LLEM. [Appellant] failed to pay as required.
Maruggi filed the deeds in lieu of foreclosure, transferring
ownership of the properties from [Appellant] to [] LLEM.
Trial Court Opinion, 1/29/2014, at 1-2 (footnotes omitted).
Thereafter, the following conveyances of the properties resulted:
On April 29, 2005, 1500 West Tioga Street was deeded from
[Appellant] to [LLEM], recorded May 7, 2005. On
*Retired Justice specially assigned to the Superior Court.
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September 13, 2006, this property was deeded to CK
Investments, LLC (“CKI”), recorded March 16, 2007.
Finally, CKI deeded this property to MDS Management
Services, LLC (“MDS”), on November 24, 2008, recorded
January 5, 2009.
On August 8, 2005, 1615 West Tioga Street was deeded
from [Appellant] to Pinnacle Capital Funding, LLC
(“Pinnacle”), recorded May 3, 2006. On September 13,
2006, Pinnacle deeded this property to CKI, recorded March
16, 2007. Finally, CKI deeded this property to MDS on
November 24, 2008, recorded January 5, 2009.
MDS Management v. Robinson, 47 A.3d 1237 (Pa. Super. 2012)
(unpublished memorandum) at 2-3.
Procedurally, the case advanced as follows:
[Appellant] filed [a] quiet title action on May 18, 2007. The
action was consolidated with two associated cases[,
ejectment actions filed by CKI and MDS,] on July 3, 2010.
[Following an appeal, this Court] directed that the [] quiet
title action be tried before the associated consolidated
cases. Accordingly, the matter proceeded to a nonjury trial
on June 12 and 13, 2013. [The trial court] found for []
LLEM and against [Appellant], and restored the consolidated
cases to the non-jury pool for trial pending appeal of the
[trial court’s] finding. [Appellant] filed a motion for post-
trial relief on July 3, 2013. [Appellant] timely appeals the
[trial court’s] decision.
Trial Court Opinion, 1/29/2014, at 1 (unnecessary capitalization and
footnote omitted).
On appeal, Appellant presents the following issues for our review:1
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1
MDS, as the subsequent purchaser for value of the subject properties
following the various conveyances as outlined above, has filed a brief in
opposition to Appellant’s appeal.
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A. Whether the trial court committed [an] error of law and
[an] abuse of discretion by denying [Appellant’s] quiet
title claim where [a] licensed attorney stole title and then
conveyed it multiple times and another licensed attorney
simultaneously represented both the initial conveyee and
a subsequent conveyee and, while having knowledge of
and making judicial admissions of the fraudulence and
impropriety of the previous conveyances, obstructed
their reversal, solely in the interest of the subsequent
conveyee.
B. Whether the trial court abused its discretion and
committed an error of law by finding Maruggi’s initial
conveyance of title to be valid while disregarding
[Appellant’s] presentation of clear and convincing
evidence of fraudulence by Maruggi in performing [the]
initial conveyance, including [the] initial purported
conveyor and conveyee both giving unrefuted testimony
that the conveyance was fraudulent, particularly where
[the] trial court was aware of previous court rulings
regarding the fraudulence of the Maruggi conveyances by
the Philadelphia Court of Common Pleas, the Supreme
Court of New York, and United States District Court for
the Southern District of New York.
C. Whether the trial court abused its discretion and
committed errors of law by denying [] LLEM’s motion for
leave of court to amend [its] answer, by which LLEM
sought to replace the duplicitous answer to [Appellant’s]
quiet title complaint prepared and filed by [LLEM’s]
former attorney, Brian Wind, Esquire, who
simultaneously represented [the] subsequent recipient of
the stolen title, MDS [Management Services, LLC], which,
to this day, continues to obstruct the return of title to the
theft victims.
D. Whether the trial court abused its discretion and
committed [an] error of law by its order denying
[Appellant’s] and LLEM’s joint motion in limine to
preclude the re-argument of matters already decided by
[this Court], to limit the trial to resolving the validity of
the first Maruggi conveyance, and to preclude the
continued interference and obstruction by the third
conveyee, MDS.
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Appellant’s Brief at 1 (unnecessary capitalization and parentheticals
omitted).2
First, we examine Appellant’s issues pertaining to evidentiary matters,
before reviewing the other substantive issues presented. In his last issue
presented, Appellant claims the trial court abused its discretion or committed
an error of law by denying his motion in limine to preclude a handwriting
expert from testifying at trial. Id. at 33. More specifically, Appellant
contends that the trial court impermissibly allowed “third conveyee MDS” to
present the testimony of a handwriting expert “two months after the close of
discovery” to show that Appellant signed the deeds in lieu of foreclosure at
issue herein. Id. at 33-34. Citing Pa.R.C.P. 4003.5 and related caselaw,
Appellant contends that MDS violated the rules pertaining to the discovery of
expert witnesses. Id. at 31-33. He claims “[i]t was clearly legal error for
the trial court to accept evidence submitted by third conveyee MDS’s hand-
writing expert consisting of unlawfully notarized signatures[].” Id. at 34.
Our standard of review is as follows:
Generally, a trial court's decision to grant or deny a motion
in limine is subject to an evidentiary abuse of discretion
standard of review. The term discretion imports the exercise
of judgment, wisdom and skill so as to reach a
dispassionate conclusion, within the framework of the law,
and is not exercised for the purpose of giving effect to the
will of the judge. Discretion must be exercised on the
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2
We note that Appellant’s arguments in his appellate brief do not
correspond with the order in which the issues are presented.
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foundation of reason, as opposed to prejudice, personal
motivations, caprice or arbitrary actions. Discretion is
abused when the course pursued represents not merely an
error of judgment, but where the judgment is manifestly
unreasonable or where the law is not applied or where the
record shows that the action is a result of partiality,
prejudice, bias or ill will.
Catlin v. Hamburg, 56 A.3d 914, 922 (Pa. Super. 2012) (citation omitted).
We have previously determined:
[Pennsylvania] Rule [of Civil Procedure] 4003.5 governs the
disclosure of an expert's facts and opinions otherwise
discoverable under the provisions of Rule 4003.1 and
acquired or developed in anticipation of litigation or for trial.
The Rule requires a party to disclose his expert's opinion
prior to trial via answers to interrogatories or by providing a
report. The answers or report must be signed by the expert.
Pa.R.Civ.P. 4003.5(a)(1)(b). Furthermore, if the identity of
an expert witness is not disclosed, Rule 4003.5 authorizes
sanctions, such as preclusion of the proposed expert's
testimony. Pa.R.Civ.P. 4003.5(b). The sanction authorized
by Rule 4003.5 is not mandatory. Toogood v. Rogal, 764
A.2d 552, 557 (Pa. Super. 2000). Rather, when a discovery
violation occurs as a result of a failure to identify an expert
witness, “the presiding court must balance the facts and
circumstances of each case to determine the prejudice to
each party.” Id. The court considers the following factors:
(1) the prejudice or surprise in fact of the party
against whom the excluded witnesses would have
testified, (2) the ability of that party to cure the
prejudice, (3) the extent to which waiver of the rule
against calling unlisted witnesses would disrupt the
orderly and efficient trial of the case or of other
cases in the court, and (4) bad faith or willfulness in
failing to comply with the court's order.
Wolloch v. Aiken, 756 A.2d 5, 13 (Pa. Super. 2000).
Corrado v. Thomas Jefferson Univ. Hosp., 790 A.2d 1022, 1032 (Pa.
Super. 2001) (parentheticals omitted).
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“While the late disclosure of the identity or qualifications of an expert
is to be condemned, the mere occurrence of such a circumstance does not
per se create grounds for a new trial.” Kemp v. Qualls, 473 A.2d 1369,
1374 (Pa. Super. 1984). The preclusion of expert testimony based upon the
late disclosure of information is “a drastic sanction” and is within the trial
court’s discretion. Id. (citation omitted).
We turn now to the facts of this case. Upon remand from this Court,
on September 21, 2012, the trial court issued a case management order and
set the close of discovery for February 4, 2013. Upon review of the certified
record, Appellant did not request expert discovery. On February 4, 2013, in
its identification of trial witnesses and exhibits, MDS listed “William J. Ries to
offer testimony related to the authenticity of signatures on relevant
documents.” MDS Identification of Witnesses and Exhibits, 2/4/2013, at 2, ¶
1E. William J. Reis prepared a report dated March 3, 2013, which then was
sent to Appellant on April 17, 2013. Appellant does not dispute that he
received the report prior to trial. On May 16, 2013, Appellant filed a motion
in limine “object[ing] to the purported handwriting expert report” and
requested the trial court “preclude the report from being considered as
evidence.” Appellant’s Motion in Limine, 5/16/2013, ¶ 14. Based upon these
facts and the relevant law, we conclude that MDS identified its expert during
discovery and sent Appellant a copy of the relevant expert report prior to
trial. Thus, we discern no abuse of discretion in denying Appellant relief.
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Moreover, we note that at all times, Appellant has challenged the
authenticity of the deeds in lieu of foreclosure. In his amended complaint to
quiet title, filed on March 8, 2009, Appellant maintained that the subject
properties were fraudulently conveyed using “forged documents, purportedly
executed by [Appellant], which were not in fact executed by [Appellant].”
Amended Complaint, 3/8/2009, at ¶ 6. Appellant attached copies of the
deeds at issue. Thus, Appellant’s quiet title action put the authenticity of the
documents squarely at issue. Certainly, Appellant cannot claim surprise that
MDS produced an expert to defend against Appellant’s assertion that he did
not sign the deeds and loan documents in question. There was no reason
why Appellant could not cure any purported prejudice by retaining his own
expert to support his claim that he did not execute the deeds in lieu of
foreclosure. Before the close of discovery, William J. Ries was specifically
listed as a trial witness. There is no evidence that any party acted in bad
faith in failing to comply with the trial court’s discovery order. Accordingly,
Appellant has not demonstrated prejudice. Hence, Appellant’s claim lacks
merit.
In his third issue presented, Appellant claims the trial court erred by
denying LLEM’s motion for leave to amend its answer following this Court’s
remand. Appellant’s Brief at 6. More specifically, Appellant maintains that
prior counsel for LLEM, Attorney Brian Wind, “disregarded [LLEM’s] interests
and direct instructions” because of his “simultaneous representation of
competing parties with conflicting interests[]” when he filed the original
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answer. Id. at 7. Appellant asserts that following this Court’s remand,
“Attorney Joseph DiTomo[] officially entered his appearance for LLEM and
moved for leave of court to amend the [a]nswer [Attorney Wind] had filed to
[the quiet title] complaint.” Id. at 6. Appellant contends that the trial court
erred by denying LLEM’s request to amend.
Pennsylvania Rule of Civil Procedure 1033 provides in pertinent part
that “[a] party ... by leave of court, may at any time ... amend his pleading.
The amended pleading may aver transactions or occurrences which have
happened before or after the filing of the original pleading, even though they
give rise to a new ... defense.” Pa.R.Civ.P. 1033. Regarding amendment,
this Court has previously determined:
Pleadings may be amended at the discretion of the trial
court after pleadings are closed, while a motion for
judgment on the pleadings is pending, at trial, after
judgment, or after an award has been made and an appeal
taken therefrom. Our courts have established as parameter
a policy that amendments to pleadings will be liberally
allowed to secure a determination of cases on their merits.
A trial court enjoys broad discretion in evaluating
amendment petitions.
Despite this liberal amendment policy, Pennsylvania
appellate courts have repeatedly ruled that an amendment
will not be permitted where it is against a positive rule of
law, or where the amendment will surprise or prejudice the
opposing party. The prejudice, however, must be more
than a mere detriment to the other party because any
amendment requested certainly will be designed to
strengthen the legal position of the amending party and
correspondingly weaken the position of the adverse party.
The mere fact that the adverse party has expended time
and effort in preparing to try a case against the amending
party is not such prejudice as to justify denying the
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amending party leave to amend by asserting an affirmative
defense which has a substantial likelihood of success.
All amendments have this in common: they are
offered later in time than the pleading which they
seek to amend. If the amendment contains
allegations which would have been allowed inclusion
in the original pleading (the usual case), then the
question of prejudice is presented by the time at
which it is offered rather than by the substance of
what is offered. The possible prejudice, in other
words, must stem from the fact that the new
allegations are offered late rather than in the original
pleading, and not from the fact that the opponent
may lose his case on the merits if the pleading is
allowed.
Denial of a petition to amend, based on nothing more than
unreasonable delay, is an abuse of discretion. The
timeliness of the request to amend is a factor to be
considered, but it is to be considered only insofar as it
presents a question of prejudice to the opposing party, as
by loss of witnesses or eleventh hour surprise.
Capobianchi v. BIC Corp., 666 A.2d 344, 346-347 (Pa. Super. 1995)
(internal citations, quotations and brackets omitted) (emphasis in original).
Upon review of the record, we recognize the following facts in deciding
Appellant’s amendment issue. Appellant commenced the quiet title action in
May 2007. With leave of court, Appellant filed an amended complaint on
March 8, 2009. LLEM filed its original answer in March 2009. In November
2010, Attorney DiTomo, LLEM’s newly retained counsel, entered his
appearance, informed the trial court that Attorney Wind had been formally
discharged by LLEM, and asserted, for the first time, that the subject
properties had been conveyed fraudulently. In March 2012, this Court
remanded the consolidated matters to the trial court for resolution of the
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quiet title action. In November 2012, LLEM filed a motion to amend its
answer and, in its accompanying memorandum of law, averred the
following:
The attorney who filed the answer to [Appellant’s] quiet title
complaint on behalf of defendant LLEM [], a certain Brandon
Wind, Esquire, also simultaneously represented the plaintiff
MDS in [MDS’ ejectment action], in a clear conflict of
interest.
Despite having been instructed by his former client LLEM
that the quiet title complaint [] was correct, and that LLEM’s
answers to that complaint should have been admissions,
Attorney Wind instead filed answers denying the averments
of [Appellant’s] quiet title complaint.
Unbeknownst to LLEM at that time, Attorney Wind’s answers
to [Appellant’s] quiet title complaint were not designed to
protect any interest of his then-client [], LLEM, but instead
were designed to promote the interests of Wind’s then-
client in [the MDS ejectment action].
In further pursuit of the interests [] MDS, while still counsel
of record representing [] LLEM [in the quiet title action],
Attorney Wind caused a writ of execution to be issued
against [Appellant], despite knowing, as his client LLEM told
him, that title was never validly conveyed to LLEM from
[Appellant].
During the course of the pre-appeal trial court litigation,
both conflicting parties, [the ejectment action plaintiff],
MDS, and [the quiet title action defendant], LLEM, replaced
Attorney Wind with current counsel. Subsequently, Mr.
Ralph Emproto, the President and sole shareholder of LLEM,
reported Attorney Wind’s conduct in this matter to the
Disciplinary Board of the Supreme Court of Pennsylvania.
Now that the matter has been through three appeals to the
Superior Court, and remanded to the trial court, after more
than five years of legal morass, resolution of the matter can
be expedited by allowing current undersigned counsel of
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LLEM to amend the discredited and tainted answer
submitted by LLEM’s former counsel, Brandon Wind.
Memorandum of Law on Support of LLEM’s Motion for Leave of Court to
Amend Answer, 11/19/2012, at *3 (unpaginated).
Applying the applicable law to the facts of this case, we conclude that
the trial court did not abuse its discretion in denying LLEM’s motion to
amend its answer. Appellant filed the quiet title complaint in 2007 and an
amended complaint in 2009. In its original answer, filed in 2009, LLEM
denied the substantive allegations in Appellant’s quiet title action. Changing
tact in 2012, LLEM sought to amend its answer to admit those same
allegations it had previously denied. However, as previously discussed,
LLEM retained new counsel in 2010 and discharged Attorney Wind. At that
time, LLEM alleged that the properties had been fraudulently conveyed. But,
it was not until November 2012, two full years later, that LLEM sought to
amend its answer to the quiet title action. The bench trial proceeded in June
2013. Based on all of the foregoing, we conclude that LLEM’s request to
amend was untimely and caused prejudice to the opposing party due to
eleventh hour surprise. LLEM did not offer justification as to delay in
seeking amendment despite the passage of at least two full years from the
time it first knew that it was changing its position. Attorney Wind was fired
in 2010. LLEM later claimed that it was because he filed the original answer
without authorization. However, LLEM never explained why it waited two
years to file a motion for leave to amend. A complete turnabout in position
six months prior to trial amounted to prejudice to MDS, an opposing party.
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Accordingly, the trial court did not abuse its discretion in denying LLEM’s
motion for leave to amend its answer. Hence, Appellant’s third issue as
presented lacks merit.
Finally, in his first two issues as presented, Appellant argues that the
subsequent conveyances of the property were fraudulent. Pointing to other
unrelated civil cases, Appellant claims that Patrick Maruggi, the intermediary
between Appellant and LLEM, has been found guilty of committing fraud in
other instances. Appellant’s Brief at 17, 29-30. Thus, he claims the trial
court herein was required to apply the doctrine of collateral estoppel. Id. at
21. Appellant also points out that, in 2011, the Supreme Court of New York
suspended Maruggi’s license to practice law in that state. Id. at 17. These
claims, however, are wholly extraneous to an action to quiet title.
On these issues, the trial court determined:
Mortgages are contracts, and pursuant to the terms of the
contract a mortgagee may foreclose on the mortgagor’s
property upon default. A deed in lieu of foreclosure
obviates the need for a foreclosure sale. Here, [Appellant’s]
property was taken as payment for money borrowed when
the deed in lieu of foreclosure was filed. Thus, the [trial
court] denied [Appellant’s] claim to quiet title.
[Appellant’s] post-trial motions argued that the [trial court]
either misconstrued or refused to admit evidence of Patrick
Maruggi’s behavior. Whether or not Maruggi had authority
to file the deed in lieu of foreclosure is legally irrelevant to
the question presented in this quiet title action. Whether or
not Maruggi had authority to file the deed in lieu of
foreclosure may be relevant to the [consolidated] actions [].
But it has no bearing on whether [Appellant] owns the
property.
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Trial Court Opinion, 1/28/2014, at 2-3 (footnote citations omitted).
As the trial court noted, this cause of action boils down to the
mortgage agreement. Upon review, Appellant accepted loans on the
properties and agreed to make payments on them. The agreement states
that failure to repay the loans constitutes immediate default, thereby
allowing Appellant’s lenders to file the deeds in lieu of foreclosure. Appellant
testified that he did not sign the deeds in lieu of foreclosure. See N.T.,
6/12/2013, at 294. As previously discussed, however, the trial court
properly permitted William Ries to testify as a handwriting expert at trial and
he opined that the deeds in lieu of foreclosure bore Appellant’s original
signatures. See N.T., 6/13/2013, at 64-69. Appellant admitted that he
received money on the loans and then defaulted. See N.T., 6/12/2013, at
281-285. Therefore, the subsequently filed deeds were proper. As such,
Appellant’s remaining appellate contentions regarding the subsequent
conveyances are meritless.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 3/12/2015
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