Perkins, T. v. Venezia Enterprises ( 2018 )

J-A12021-18
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
THOMAS PERKINS, III AND DONNA : IN THE SUPERIOR COURT OF
SNYDER : PENNSYLVANIA
:
Appellant :
:
:
v. :
:
: No. 2039 EDA 2017
VENEZIA ENTERPRISES, FRANK :
VENEZIA, JOHN J. VENEZIA AND :
ANDREW VENEZIA :
Appeal from the Order Entered June 5, 2017
In the Court of Common Pleas of Montgomery County
Civil Division at No(s): 2006-07884
BEFORE: BOWES, J., OTT, J., and FORD ELLIOTT, P.J.E.
MEMORANDUM BY OTT, J.: FILED DECEMBER 20, 2018
Thomas Perkins, III, and Donna Snyder, brother and sister (collectively,
“Perkins”) appeal from the order entered on June 5, 2017, in the Court of
Common Pleas of Montgomery County, granting summary judgment to
Venezia Enterprises, Frank Venezia, John J. Venezia, and Andrew Venezia
(collectively, “Venezia”), and dismissing their fraudulent misrepresentation or
concealment, negligent misrepresentation or concealment, and violation of
Unfair Trade Practices and Consumer Protection Law (“UTPCPL”)1 claims. The
underlying action stems from the sale of commercial real estate from Venezia
____________________________________________
1 See 73 P.S. § 201-1, et seq. As will be discussed infra, Perkins does not
assert any argument involving the UTPCPL claim, therefore, it is waived for
purposes of this appeal.
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to Perkins, in which Perkins alleged Venezia misrepresented the actual acreage
of the property at issue, which induced them to enter into an Agreement of
Sale for the same. Perkins now claim the trial court erred and/or abused its
discretion regarding the following: (1) by granting motions in limine which
duplicated, in terms of issues, facts, law, and request for relief, a motion for
summary judgment previously denied by a judge of coordinate jurisdiction;
(2) by granting the motion in limine which, based on the gist-of-the-action
doctrine, did not preclude any evidence, but rather barred [Perkins]’ recovery
pursuant to their tort claims; and (3) by granting the motion in limine which,
based on the parol evidence rule, precluded all evidence which could in any
way support [Perkins]’ fraud in the inducement claim, including
representations made within the agreement. See Perkins’ Brief at 4-5.
Perkins also claims the court erred in granting summary judgment based on
these arguments. Id. For the reasons below, we affirm.
The trial court summarized the relevant facts as follows:
[Perkins’] agent/realtor, Anthony Giamo, contacted Frank Venezia
inquiring whether Venezia would be interested in selling the
property located at 703 W. Ridge Pike, Limerick, Pennsylvania.
[Venezia’s] property was not listed for sale at the time. After
some conversation, [Venezia] agreed to sell the Property to
[Perkins] for $960,000. During the parties’ meeting, [Perkins]
allege that there was discussion concerning the actual acreage of
the property. The tax map indicated that the property was 9.89
acres but Mr. Venezia allegedly orally claimed that the property
was slightly less—9.3 acres. Despite this confusion, [Perkins’]
realtor prepared an Agreement of Sale and inserted 9.3 acres in
the Agreement. [Perkins’] agent inserted 9.3 acres in the
Agreement based solely upon [Venezia’s] alleged oral assertion.
[Perkins] conducted no independent confirmation of the acreage.
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On January 19, 2001, the parties executed the Agreement of Sale.
[Venezia was] not represented by a realtor. On that same day,
the parties added an Addendum to the Agreement of Sale which
included a 90 day due diligence clause which allowed [Perkins] 90
days to conduct due diligence including a survey. [Perkins] failed
to conduct a survey within those 90 days. In 2004, [Perkins]
conducted a survey of the property in connection with a zoning
application and learned that the property was only 7.6 acres. The
present law suit followed.
In their Amended Complaint, [Perkins pled] tort claims,
namely, Count [I] – Fraudulent Misrepresentation or Concealment
and Count II – Negligent Misrepresentation or Concealment.1
[Perkins] did not plead breach of contract under the Agreement of
Sale because they believed that the statute of limitations had run
on the same, and because[] they did not believe that there was a
breach of the actual contract terms.
________________________
1 [Perkins] also ple[d] Count III – Violation of the
[UTPACPL]. However, Count III is not at issue herein. The
[UTPACPL] does not apply to commercial properties like the
one at bar, and [Perkins] conceded and/or waived any
argument contra.
________________________
[On February 17, 2016, Venezia filed a motion for summary
judgment, alleging, inter alia, Perkins’ tort claims should be
dismissed based on: (1) the “gist of the action” doctrine and (2)
due to the integration clause contained in the Agreement of Sale,
Perkins cannot rely on oral representations made by Venezia
where the contract states that no such representations are
included in the terms of the document. Perkins filed a response
on March 24, 2016, as well as a cross-motion seeking judgment.
On July 1, 2016, the Honorable Richard P. Haaz denied both
parties’ motions for summary judgment without explanation. The
matter was then transferred to the Honorable Carolyn Tornetta
Carluccio.
On May 15, 2017, Venezia filed a motion in limine,
requesting the trial court to preclude Perkins’ recovery on the tort
claims under the “gist of the action” doctrine. Additionally,
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Venezia sought to preclude any evidence related to Perkins’ fraud-
in-the-inducement claims based on the integration clause set forth
in the Agreement of Sale.]
On June 2, 2017, after argument and review of briefs, the
trial court granted [Venezia’s] [m]otion [in limine] to [p]reclude
[r]ecovery under [a]ny and [a]ll [t]ort [c]laims in the above
captioned matter. In addition[,] the trial court also granted
[Venezia’s] [m]otion to [p]reclude any [e]vidence relating to
[f]raud in the [i]nducement as the [a]greement of [s]ale was a
fully integrated document.
Trial Court Opinion, 11/22/2017, at 1-2 (emphasis in original, citations
omitted). Subsequently, on June 5, 2017, the trial court granted Venezia’s
oral motion for summary judgment. Perkins filed this timely appeal.2
On appeal, with respect to all of their arguments, Perkins contend the
trial court abused its discretion in granting Venezia’s motion in limine, and
consequently, their motion for summary judgment. See Perkins’ Brief at 3-4.
Our standard of review is well-settled:
A motion in limine is used before trial to obtain a ruling on the
admissibility of evidence. It gives the trial judge the opportunity
to weigh potentially prejudicial and harmful evidence before the
trial occurs, thus preventing the evidence from ever reaching the
jury. A trial court’s decision to grant or deny a motion in limine is
subject to an evidentiary abuse of discretion standard of review.
Questions concerning the admissibility of evidence lie within the
sound discretion of the trial court, and we will not reverse the
court’s decision absent a clear abuse of discretion. An abuse of
discretion may not be found merely because an appellate court
might have reached a different conclusion, but requires a manifest
____________________________________________
2 On July 6, 2017, the trial court ordered Perkins to file a concise statement
of errors complained of on appeal pursuant to Pa.R.A.P. 1925(b). Perkins filed
a concise statement on July 29, 2017. The trial court issued an opinion
pursuant to Pa.R.A.P. 1925(a) on November 22, 2017.
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unreasonableness, or partiality, prejudice, bias, or ill-will, or such
lack of support so as to be clearly erroneous.
In addition, to constitute reversible error, an evidentiary ruling
must not only be erroneous, but also harmful or prejudicial to the
complaining party.
Parr v. Ford Motor Co., 109 A.3d 682, 690-691 (Pa. Super. 2014) (citations
omitted), appeal denied, 123 A.3d 331 (Pa. 2015), cert. denied, 136 S. Ct.
557 (U.S. 2015). Moreover, because the trial court’s grant of Venezia’s motion
in limine formed the basis for its subsequent grant of Venezia’s motion for
summary judgment, we are also guided by the following:
We review an order granting summary judgment for an abuse of
discretion or error of law. Indalex, Inc. v. Nat'l Union Fire Ins.
Co. of Pittsburgh, PA, 2013 PA Super 311, 83 A.3d 418, 420
(Pa. Super. 2013). Our standard of review is plenary, and we view
the record in the light most favorable to the nonmoving party. Id.A party bearing the burden of proof at trial is entitled to summary
judgment “whenever there is no genuine issue of any material fact
as to a necessary element of the cause of action or defense which
could be established by additional discovery or expert report[.]”
Pa.R.C.P. 1035.2(1). In response to a summary judgment
motion, the nonmoving party cannot rest upon the pleadings, but
rather must set forth specific facts demonstrating a genuine issue
of material fact. Pa.R.C.P. 1035.3.
Vetter v. Miller, 157 A.3d 943, 948 (Pa. Super. 2017), appeal denied, 182
A.3d 987 (Pa. 2017).
In their first argument, Perkins claim the court “failed to adhere to the
coordinate jurisdiction rule in granting the motions in limine which served as
the basis for the dismissal of Perkins’ fraudulent and negligent
misrepresentation claims.” See Perkins’ Brief at 18. By way of background,
they state:
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Nearly a year before Judge Carluccio issued her ruling, on July 5,
2016, Judge Haaz, who did not preside over the trial phase of the
case, ruled on cross -motions for summary judgment. Within their
motion for summary judgment, Venezia requested the entry of
summary judgment in its favor related to Perkins’ claims for
fraudulent and negligent misrepresentation. Venezia alleged that
gist-of-the-action doctrine barred those claims as a matter of law,
and that the underlying contract is integrated thereby also barring
Perkins from presenting any evidence which could prove fraud-in-
the-inducement. Based on Venezias’ motion and brief, Perkins’
response and brief, and after oral argument, Judge Haaz denied
Venezias’ motion for summary judgment on all counts, including
but not limited to the gist -of -the -action doctrine and the parol
evidence rule. Judge Haaz permitted Perkins’ claims to proceed
to trial, and the case was then reassigned to Judge Carluccio for
the trial phase.
On May 15, 2017, Venezia filed with Judge Carluccio a
motion in limine titled, “Defendants’ Motion in limine to Preclude
Recovery Under Any and All Tort Claims.”
Id. at 19-20 (reproduced record citations omitted).
Relying on Campbell v. Attanasio, 862 A.2d 1282 (Pa. Super. 2004),
appeal denied, 881 A.2d 818 (Pa. 2005), Perkins allege:
As is evident from their prayer for relief, Venezia’s motion in limine
is nothing more than a reconstituted motion for summary
judgment.
…
The motions in limine did not present any new evidence, let alone
a substantial change in the facts. Likewise, Venezia did not
present any new case law, let alone an intervening change in the
controlling law. Absent a substantial change in the facts or an
intervening change in the controlling law, the coordinate
jurisdiction rule required Judge Carluccio to afford Judge Haaz’s
denial extreme deference, and hold the defense to a strict burden
of persuasion. Judge Carluccio failed to do so, and therefore did
not properly evaluate Judge Haaz’s ruling against the clearly
erroneous standard of review. This deprived Perkins of their right
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to a trial against Venezia, and it was thus Perkins who suffered
the “manifest injustice.”
Id. at 21, 24-25 (reproduced record citations omitted).
The Pennsylvania Supreme Court has explained the coordinate
jurisdiction rule as follows:
One of the distinct rules that are encompassed within the “law of
the case” doctrine is the coordinate jurisdiction rule. Generally,
the coordinate jurisdiction rule commands that upon transfer of a
matter between trial judges of coordinate jurisdiction, a transferee
trial judge may not alter resolution of a legal question previously
decided by a transferor trial judge. More simply stated, judges of
coordinate jurisdiction should not overrule each other’s decisions.
The reason for this respect for an equal tribunal’s decision ... is
that the coordinate jurisdiction rule is based on a policy of
fostering the finality of pre-trial applications in an effort to
maintain judicial economy and efficiency. Furthermore, consistent
with the law of the case doctrine, the coordinate jurisdiction rule
serves to protect the expectations of the parties, to insure
uniformity of decisions, to maintain consistency in proceedings, to
effectuate the administration of justice, and to bring finality to the
litigation.
Zane v. Friends Hosp., 836 A.2d 25, 29 (Pa. 2003) (internal citations and
footnote omitted).
In addressing Perkins’ argument, the trial court noted:
[T]o the extent that [Perkins] argue that the trial court improperly
entered summary judgment herein due to the previous cross-
summary judgment rulings in this matter, the trial court refers the
appellate court to Nobles v. Staples, Inc.[,] 150 A.[3]d 110 (Pa.
Super. 2016). In addition, as stated on the record, a motion for
summary judgment and a motion in limine require two different
standards of review. (Notes of Testimony 5/31/17, pg. 3)[.]
Finally, the parties herein conceded that the question before the
court concerning the gist of the action was a question of law. (Id.
at pgs. 13-14)[.]
Trial Court Opinion, 11/22/2017, at 3 n.2.
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In Nobles, supra, the plaintiff filed a personal injury action against the
defendant. Nobles, 150 A.3d at 112. The defendant moved for summary
judgment, which was denied without prejudice by the Honorable Annette M.
Rizzo because the motion had been filed prior to the expiration of the
discovery period. Id. Subsequently, the defendant moved again for summary
judgment, repeating the same ground as in its first motion. Id. The
Honorable Federica Massiah-Jackson entered an order denying the motion,
without further comment. Id. The defendant then filed two motions in limine,
asserting similar grounds to the motions for summary judgment. Id. at 112-
113. The Honorable Mary D. Colins heard argument on the two motions in
limine and granted both. Id. at 113. In light of those decisions, the trial
judge granted the defendants’ motion to dismiss the action. Id. On appeal,
the plaintiff alleged it was a “violation of the coordinate jurisdiction rule for a
trial court to grant a motion for non-suit, which it deemed a motion for
summary judgment, after the court had already denied a motion for summary
judgment[.]” Id. In affirming the trial court’s decision, a panel of this Court
stated:
In the current action, once Judge Colins granted [the defendant’s]
motions in limine, the status of the case changed materially.
Therefore, the basis upon which Judge Colins granted the final
motion for summary judgment was very different from the bases
upon which Judge Rizzo and Judge Massiah-Jackson relied when
they denied [the defendant’s] first and second motions for
summary judgment several months earlier. Once Judge Colins
held that [the plaintiff’s] expert would not be allowed to testify, it
became clear that there was no viable way in which [the plaintiff]
could recover — as [the plaintiff’s] counsel himself admitted when
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he told Judge Colins that she had “put us out of court.” See Trial
Court Opinion, 2/9/16, at 5-6. Accordingly, it was appropriate for
Judge Colins to then grant [the defendant’s] motion to dismiss the
case, even if that motion was the equivalent of a third motion for
summary judgment. In doing so, the trial court did not violate
the coordinate jurisdiction rule.
Nobles, 150 A.3d at 119-20.
In Campbell, supra, the defendants filed motions for summary
judgment wherein they sought to preclude the defendant’s expert from
testifying at trial. Campbell, 862 A.2d at 1284. The trial judge denied the
motions. Id. at 1285. The defendants subsequently filed motions in limine,
in which they raised the same issue as presented in the motions for summary
judgment. Id. The matter was transferred to a second judge, who granted
the motions in limine. That judge then dismissed the action in its entirety.
On appeal, a panel of this Court determined the coordinate jurisdiction rule
was violated because: (1) both sets of motions raised the same issue; and
(2) there was no indication that the second judge “considered additional facts
or evidence that had not been presented to” the first judge. Id. at 1287.
Turning to the present matter, we agree with the trial court that Nobles
is applicable, and we find Campbell is distinguishable. In Ryan v. Berman,
813 A.2d 792 (Pa. 2002), the Pennsylvania Supreme Court stated: “Where
the motions differ in kind, as preliminary objections differ from … motions for
summary judgment, a judge ruling on a later motion is not precluded from
granting relief although another judge has denied an earlier motion.” Ryan,
813 A.2d at 794, quoting Goldey v. Trustees of University of
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Pennsylvania, 675 A.2d 264, 267 (Pa. 1996). As pointed out by the trial
court, a motion for summary judgment and a motion in limine require two
different standards of review and therefore, are motions that differ in kind.
See Ryan, supra. Moreover, unlike in Campbell, we find dispositive that,
here, while Judge Haaz denied Venezia’s motion for summary judgment, he
did so without providing any explanation regarding his determination. It is
unknown whether Judge Haaz made that finding because the discovery period
had not ended, a procedural defect, or for some reason other than the viability
of the claims presented by Venezia. If so, then the coordinate jurisdiction rule
would not bar Judge Carluccio from ruling on the merits of the substantive
claims set forth in their motions in limine.3 As such, given these specific
circumstances, particularly the lack of clarification from Judge Haaz, we are
compelled to conclude that the coordinate jurisdiction rule was not implicated
in this case. See Nobles, supra.4
Next, Perkins contends its “tort claims are not barred by the gist-of-the-
action doctrine as the claims assert misfeasance rather than nonfeasance; the
claims are deception, not a failure to perform pursuant to a contract.” Perkins’
Brief at 26. They state:
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3 Further, as the trial court noted, and the parties agreed, the gist of the
action doctrine argument was a legal question that needed to be decided
before the trial.
4 See also Salerno v. Phila. Newspapers, Inc., 546 A.2d 1168, 1170 (Pa.
Super. 1988).
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Perkins filed claims for fraudulent and negligent
misrepresentation. The gist of Perkins’ claims is deception by
Venezia, not that Venezia failed to perform pursuant to the
Agreement. Stated another way, the substance of Perkins’ claims
is not that Venezia failed to deliver, pursuant to the Agreement, a
property 9.3 acres in size. Rather, the substance of the claims is
that there would be no contract [] but for Venezias’ gross
misrepresentation of the size of the property, which at best were
negligent and at worst intentional.
Id. at 31 (reproduced record citation omitted).5 For example, Perkins points
to the following allegations in their amended complaint as the basis for the
fraudulent misrepresentation or concealment claim:
14. At the meeting, [Perkins’ real estate agent] indicated that he
felt that the Property was approximately 9.9 acres in size.
15. At the meeting, Defendant Frank Venezia represented that
the Property was not 9.9 acres, but in fact was slightly smaller.
16. After the meeting, Defendant Frank Venezia contacted
[Perkins’ real estate agent] and indicated that the size of the
Property was 9.3 acres.
17. [Perkins] subsequently met with Defendant Frank Venezia to
inspect the Property, at which time Defendant Frank Venezia
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5 “A cause of action for fraudulent misrepresentation is comprised of the
following elements: ‘(1) a misrepresentation, (2) a fraudulent utterance
thereof, (3) an intention by the maker that the recipient will thereby be
induced to act, (4) justifiable reliance by the recipient upon the
misrepresentation and (5) damage to the recipient as the proximate result.’”
Martin v. Lancaster Battery Co., 606 A.2d 444, 448 (Pa. 1992), quoting
Scaife Co. v. Rockwell-Standard Corp., 285 A.2d 451, 454 (Pa. 1971),
cert. denied, 407 U.S. 920 (1972). The tort of negligent misrepresentation
has the following elements: “(1) a misrepresentation of a material fact; (2)
made under circumstances in which the misrepresenter ought to have known
its falsity; (3) with an intent to induce another to act on it; and; (4) which
results in injury to a party acting in justifiable reliance on the
misrepresentation.” Bortz v. Noon, 729 A.2d 555, 561 (Pa. 1999) (citation
omitted).
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represented to Plaintiff Donna L. Snyder that the size of the
Property was 9.3 acres.
18. The Agreement of Sale entered into by the parties represents
that the Property is “...two parcels totalling 9.3 acres of land plus
buildings.”
19. At the time of the purchase of the Property, [Venezia]
affirmatively represented, both orally and in writing, that the
Property consisted of 9.3 acres of land.
20. [Venezia] knew that their representations that the Property
was 9.3 acres in size were false and intended that [Perkins] would
be induced by these false misrepresentations to execute an
Agreement of Sale for the purchase of the Property and to proceed
to closing on said Agreement of Sale.
21. [Venezia] knew that the size of the Property was a material
fact in the transaction described in this Complaint and the[y] were
obligated to disclose the true facts regarding the size of the
Property but intentionally misrepresented and/or deliberately
concealed the true quantity of land.
22. [Perkins] believed and reasonably relied upon [Venezia’s]
misrepresentations as to the size of the Property and proceeded
to purchase the Property from [Venezia] for the amount of Nine
Hundred Sixty Thousand Dollars ($960,000.00). A true and
correct copy of the Deed to the Property is attached hereto,
incorporated herein and marked as Exhibit “C”.
23. [Perkins] took possession of the Property and commenced
use as headquarters of TP Trailers, Inc.
24. After making inspections of the land, [Perkins] had a survey
performed which revealed that the Property was only 7.6 acres in
size, not the 9.3 acres previously falsely represented by [Venezia].
…
27. [Venezia], by knowingly and intentionally making false
representations of material facts about the Property, to wit,
fraudulent misrepresentations as to the size of the Property, and
by engaging in the deliberate concealment of material facts,
induced [Perkins] to execute an Agreement of Sale for the
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purchase of the Property and to proceed to closing on said
Agreement of Sale.
28. [Venezia] acted with the intentions that [Perkins] would rely
on said misrepresentations or concealments of material facts
regarding the size of the Property in executing an Agreement of
Sale to purchase the Property and in proceeding to closing on said
Agreement of Sale.
29. [Venezia’s] misrepresentations and/or concealments
concerned presently existing facts which are material to the
decision of [Perkins] to execute an Agreement of Sale[] to
purchase the Property and to proceed to closing on said
Agreement of Sale.
30. [Venezia], by their intentional misrepresentations and
deliberate and fraudulent concealments of material facts, induced
[Perkins] to execute an Agreement of Sale to purchase the
Property, to proceed to closing on said Agreement of Sale and
lulled [Perkins] into thinking they had not been defrauded.
31. [Perkins] justifiably relied upon [Venezia’s]
misrepresentations and/or concealments of material facts in
concluding that the Property was 9.3 acres in size and executed
the Agreement of Sale and proceeded to closing on said
Agreement of Sale.
32. [Perkins] have been injured as a proximate cause of
[Venezia’s] fraudulent misrepresentations and concealments of
material facts in that they purchased property materially different
from that which was represented to them, to wit, the size of the
Property is significantly smaller than was represented to them.
Amended Complaint, 5/10/2007, at 4-7. Based on allegations set forth in
their amended complaint, Perkins asserts their claims for fraudulent and
negligent misrepresentation sound in tort and implicate a social duty not to
affirmatively mislead or advise without a factual basis. Perkins’ Brief at 34.
Lastly, Perkins states:
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the essence of Perkins’ claims, at every stage of this litigation, has
been and will continue to be that Venezia knew or should have
known that the property is 7.6 acres, knew the size of the property
was material the transaction, but nevertheless misrepresented the
size of the property as 9.3 acres in order to induce Perkins to
purchase the property for $960,000. The duties allegedly
breached are ones of fair-dealing and honesty; overarching
societal duties.
Id. at 37-38.
With respect to the “gist of the action” doctrine, we note:
Where ... a tort claim arises from an initial contractual
relationship, tort recovery is permitted:
In general, courts are cautious about permitting tort
recovery based on contractual breaches. In keeping with
this principle, this Court has recognized the “gist of the
action” doctrine, which operates to preclude a plaintiff from
re-casting ordinary breach of contract claims into tort
claims.
Egan v. USI Mid-Atlantic, Inc., 92 A.3d 1, 18 (Pa. Super. 2014) (citation
omitted). As explained in Reardon v. Allegheny College, 926 A.2d 477 (Pa.
Super. 2007), appeal denied, 947 A.2d 738 (Pa. 2008):
The gist of the action doctrine acts to foreclose tort claims: 1)
arising solely from the contractual relationship between the
parties; 2) when the alleged duties breached were grounded in
the contract itself; 3) where any liability stems from the contract;
[or] 4) when the tort claim essentially duplicates the breach of
contract claim or where the success of the tort claim is dependent
on the success of the breach of contract claim. The critical
conceptual distinction between a breach of contract claim and a
tort claim is that the former arises out of breaches of duties
imposed by mutual consensus agreements between particular
individuals, while the latter arises out of breaches of duties
imposed by law as a matter of social policy.
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Reardon, 926 A.2d at 486-87 (internal citation and quotations omitted);
accord Hart v. Arnold, 884 A.2d 316, 339-340 (Pa. Super. 2005), appeal
denied, 897 A.2d 458 (Pa. 2006).
More recently, a panel of this Court opined:
To determine whether a complaint sounds a claim in contract or
in negligence, courts in Pennsylvania have used an evolving
doctrine known as the “gist of the action” doctrine. See Bruno
v. Erie Ins. Co., 630 Pa. 79, 106 A.3d 48, 61-62 (Pa. 2014); Zell
v. Arnold, 2 Pen. & W. 292 (Pa. 1830); Homey v. Nixon, 213
Pa. 20, 61 A. 1088 (Pa. 1905); Bash v. Bell Tel., 411 Pa. Super.
347, 601 A.2d 825 (Pa. Super. 1992); eToll Inc. v. Elias/Savion
Adver., 2002 PA Super 347, 811 A.2d 10 (Pa. Super. 2002). In
Bruno, the Supreme Court articulated the legal principles a court
must use to determine the gist of the action doctrine, stating that
a court must make a duty-based inquiry to determine whether the
claim is in tort or contract:
The substance of the allegations comprising a claim in a
plaintiff’s complaint are of paramount importance, and,
thus, the mere labeling by the plaintiff of a claim as being
in tort, e.g., for negligence, is not controlling. If the facts
of a particular claim establish that the duty breached is one
created by the parties by the terms of their contract — i.e.,
a specific promise to do something that a party would not
ordinarily have been obligated to do but for the existence of
the contract — then the claim is to be viewed as one for
breach of contract. If, however, the facts establish that the
claim involves the defendant’s violation of a broader social
duty owed to all individuals, which is imposed by the law of
torts and, hence, exists regardless of the contract, then it
must be regarded as a tort.
Bruno, 106 A.3d at 68. Thus, if the claim offered is for a breach
of a specific promise in the contract, then the claim will lie in
contract[,] as the duty of the parties are purely contractual.
However, if the claim is not based on the specific contractual
promise, but rather on a duty that is owed independent of any
contractual promises, then the claim will lie in tort, even if the
parties’ relationship originates from the contract.
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Kelly Sys., Inc. v. Leonard S. Fiore, Inc., __ A.3d __, 2018 PA Super 393,
¶¶ 11-12 [1714 WDA 2017] (Pa. Super. Oct. 31, 2018).
Here, the trial court found the following:
At bar, the court determined that the duties between the parties
arise from the terms of the negotiated contract between the
parties. As indicated on the record,
THE COURT: I want to get back to you. If the contract says
you are selling 9.6 acres of land---
MR. GARNER: 9.3
THE COURT: 9.3 and there is only 7.6, How is that not a
breach of contract?
MR. GARNER: It’s not.
THE COURT: If I say, I am selling you ten widgets, and I
only give you six widgets, is that a breach of contract? I
only convey six, you accept them, and move on, my contract
said ten.
MR. GARNER: I guess under the way you are posing it, you
could consider that a breach.
(Notes of Testimony 5/31/17, pgs. 110-11)
Thus, the court determined that the action arose from the contract
between the parties; the duties between the parties were created
and grounded in the contract itself; the liability stemmed from the
contract; and any tort claims duplicated the contract claim. The
gist of the Plaintiffs’ claim/action was that the Defendants failed
to deliver property 9.3 acres in size as promised in the Agreement
of Sale.
Trial Court Opinion, 11/22/2017, at 5-6.
Upon review, we agree with the trial court’s analysis. We find Hart,
supra, instructive in this matter. In Hart, the case involved a contract
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between the two sets of adjacent property owners, where the plaintiff-seller
agreed to deed approximately 55 acres of land to the defendant-purchasers
in exchange for construction of a dam to create a lake, to be completed by
the defendant-purchasers, which would, among other things, enhance the
value of plaintiff-seller’s remaining land. Hart, 884 A.2d at 322-323.
However, the same year the contract was signed, it became obvious the
required permits for the lake were no longer valid, which affected the ability
of defendant-purchasers to build the lake to the size and depth as
contemplated by the parties. Id. The defendant-purchasers then attempted
to get permission to build a lake as large as originally planned but did not
notify the plaintiff-seller. Id. Their efforts were unsuccessful, and they had
to reduce the size of the lake, which adversely affected the value of plaintiff-
seller’s property more than the defendant-purchasers. Id. at 324. In
determining plaintiff-seller’s fraud in the performance cause of action was
barred by the gist of the action doctrine, a panel of this Court determined:
[Plaintiff-seller’s] claims of fraud in the performance of the
contract are integrally related to his breach of contract claims.
The performance duties arose solely from the contract between
the parties and were created and grounded in the contract itself.
Further, these claims essentially duplicate [Plaintiff-seller’s]
breach of contract claim and the success of his fraud-in-the-
performance claims is wholly dependent on the terms of a
contract. Thus, [Plaintiff-seller’s] fraud in the performance claims
are barred under the gist of the action doctrine, because they are
collateral to the contract, which is the main cause of action.
Hart, 884 A.2d at 341 (citations omitted).
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Turning to the present matter, it is quite evident that Perkins’ claims
arise from its contractual relationship it had with Venezia, as there was a
“specific promise” to deliver the property at issue, totaling 9.3 acres, and
Venezia failed to do so. Bruno, 106 A.3d at 68. The facts do not establish
that Venezia committed a “violation of a broader social duty owed to all
individuals, which is imposed by the law of torts and, hence, exists regardless
of the contract[.]” Id. Like Hart, the “performance duties arose solely from
the contract between the parties and were created and grounded in the
contract itself.” Hart, 884 A.2d at 341. Moreover, significantly, with respect
to Perkins’ fraudulent and negligent misrepresentation claims, Perkins did not
conduct their own independent confirmation of the acreage. The Agreement
of Sale included an addendum, which permitted Perkins to conduct due
diligence for 90 days, including obtaining a survey of the property. Perkins,
however, failed to act within those 90 days, or even before settlement.
Therefore, we find Perkins’ claim is properly viewed as an action on the
contract, and their allegations of fraudulent and negligent misrepresentation
are barred by the gist-of-the-action doctrine. Furthermore, the court did not
err and/or abuse its discretion in granting summary judgment on the claim as
there was no genuine issue of any material fact as to a necessary element of
the cause of action. Accordingly, Perkins’ second claim fails.
Next, Perkins claim the court’s dismissal of their fraud-in-the-
inducement claim based on the parol evidence rule constituted both an error
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of law and abuse of discretion because the rule does not bar
misrepresentations contained in the agreement itself, and the consistent oral
misrepresentations would not be presented to vary, modify or supersede the
agreement. See Perkins’ Brief at 38. Specifically, they argue:
Venezia misrepresented the size of the property at least four
times; twice orally prior to executing the Agreement, once in the
initial Agreement, and once again in the agreement’s Addendum.
Consequently, regardless of the admissibility of the oral
statements, the written Agreement and Addendum contain the
misrepresentations. Namely, both the Agreement and the
Addendum mis[re]present the size of the property as 9.3 acres,
without qualification.
The misrepresentations contained in the agreement are
beyond the reach of the parol evidence rule, and are sufficient to
allow a jury to find in favor of Perkins with respect to the relevant
elements of their fraud -in -the -inducement claim. As a result,
the parol evidence rule cannot possibl[y] serve to preclude “any
and all evidence related” to the fraud-in-the-inducement claim,
and entitle Venezia to summary judgment on that claim.
Furthermore, the parol evidence rule cannot serve to
preclude Venezias’ oral misrepresentations because those
statements would not be entered into evidence to “vary, modify,
or supersede” the terms of the agreement. Those oral
misrepresentations are wholly consistent with the terms of the
contract which also misrepresent the size of the property as 9.3
acres, without qualification. The statements do not change in any
way the misrepresentations contained in the agreement. Instead,
the statements would be offered for reasons including but not
limited to demonstrating to the jury the scope of the fraud, and
would be relevant to Perkins’ claim for punitive damages as they
help establish a pattern of misrepresentation and thus the
outrageousness of Venezias’ conduct.
Lastly, the contract itself does not bar the introduction of
the oral misrepresentations because the integration clause states
in relevant part:
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In entering into this Agreement, [Perkins] has not
relied upon any representations, claims ... made by
[Venezia], Agents, or their employees unless expressly
incorporated or stated in this Agreement.
See R.R. at 309 (emphasis added).
Id. at 42-43 (some citations omitted).
We are guided by the following:
[F]raud-in-the-inducement claims are commonly barred if the
contract at issue is fully integrated. [Blumenstock v. Gibson,
811 A.2d 1029, 1035 (Pa. Super. 2002)]. The rationale for this
rule of law is “that a party cannot justifiably rely upon prior oral
representations” and then sign a contract containing terms that
refute the alleged prior oral representations. Id. at 1036. Thus,
when “prior fraudulent oral misrepresentations are alleged
regarding a subject that was specifically dealt with in a written
contract, the party alleging such representations must, under the
parol evidence rule, also aver that the representations were
fraudulently or by accident or mistake omitted from the integrated
written contract.” HCB Contractors v. Liberty Place Hotel
Associates, 539 Pa. 395, 398, 652 A.2d 1278, 1279 (1995). “To
require less would make a mockery of the parol evidence rule
because all a party would have to do to avoid, modify or nullify [a
contract] would be to aver that false representations were
‘fraudulently’ made.” Nicolella v. Palmer, 432 Pa. 502, 507, 248
A.2d 20, 23 (1968).
In other words,
parol evidence of prior representations is inadmissible as to
a matter covered by the written agreement with an
integration clause, unless the parties agreed that those
representations would be added to the written agreement
but they were omitted because of fraud, accident or
mistake. This situation is commonly referred to as “fraud in
the execution” [as] the party proffering the evidence
contends that he executed the agreement because he was
defrauded by being led to believe that the documents
contained terms that were actually omitted therefrom.
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Blumenstock, supra at 1036 (internal citations omitted). “The
effect of an integration clause is to make the parol evidence rule
particularly applicable. Thus the written contract, if unambiguous,
must be held to express all of the negotiations, conversations, and
agreements made prior to its execution, and neither oral
testimony, nor prior written agreements, or other writings, are
admissible to explain or vary the terms of the contract.” 1726
CherryStreet Partnership by 1726 Cherry Street Corp. v.
Bell AtlanticProperties, Inc., 439 Pa. Super. 141, 653 A. 2d.
663, 665 (Pa. Super. 1995), appeal denied, 544 Pa. 647, 664 A.2d
976 (1995).
Hart, 884 A.2d at 340-341.6
Here, the parties’ Agreement of Sale provided the following:
17. REPRESENTATIONS:
(A) In entering into this Agreement, Buyer has not relied upon any
representations, claims, advertising, promotional activities,
brochures or plans of any kind made by Seller, Agents or their
employees unless expressly incorporated or stated in this
Agreement:
(B) It is understood that Buyer has inspected the property, or
hereby waives the right to do so, and has agreed to purchase it in
its present condition. Buyer acknowledges that the Agents have
not made an independent examination or or determination of the
structural soundness of the property, the age or condition of the
components, environmental conditions, the permitted uses, or of
conditions existing in the locale where the property is situated;
nor have they made a mechanical inspection of any of the systems
contained therein.
(C) It is further understood that this agreement contains
the whole agreement between Seller and Buyer and there
are no other terms, obligations, covenants,
representations, statements or conditions, oral or
otherwise of any kind whatsoever concerning this sale.
Furthermore, this agreement shall not be altered,
____________________________________________
6 See also Yocca v. Pittsburgh Steelers Sports, Inc., 854 A.2d 425 (Pa.
2004); Youndt v. First Nat'l Bank, 868 A.2d 539 (Pa. Super. 2005).
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amended, changed or modified except in writing executed
by the parties.
Agreement of Sale, 1/17/2001, at 2 (emphasis added).
Based on the agreement, the trial court determined:
[T]he fraudulent inducement claim was independently precluded
due to the integration clause that the parties included in their
contract. Section 17(C) of the parties’ contract indicated that the
Agreement encompassed the whole agreement between the Seller
and [t]he Buyer and that there were no other terms, obligations,
covenants, representations, statements or conditions, oral or
otherwise of any kind whatsoever concerning the sale.
(Agreement of Sale, Page 2, Section 17(C))[.] Of note, the
contract was drafted by [Perkins’] agent; [Venezia] was
unrepresented in the transaction. Based upon Section 17(C),
[Perkins was] precluded from bringing in any evidence of the
acreage of the property other than that which was included in the
Agreement itself. [Perkins] drafted and then signed an Agreement
and Addendum, containing an integration clause which clearly
stated that the document encompassed the entire agreement
between the parties. Based upon the same, the court properly
determined that [Perkins] were precluded from arguing otherwise.
Trial Court Opinion, 11/22/2017, at 6-7 (emphasis removed).
Consistent with the analysis set forth in Hart, and the integration clause
provided in the Agreement of Sale, there is no reason to disturb the trial
court’s dismissal of Perkins’ fraud-in-the-inducement claims, and their
argument does not persuade us otherwise. The contract explicitly states that
no such representations are included in its terms. Accordingly, Perkins’ final
argument fails. Therefore, we conclude the trial court did not err in granting
Venezia’s motion in limine and motion for summary judgment with respect to
this claim.
Order affirmed.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 12/20/18
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