Sabella, A. v. Estate of Milides ( 2014 )

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NON-PRECEDENTIAL DECISION SEE SUPERIOR COURT I.O.P. 65.37
ANTHONY J. SABELLA, : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
v. :
:
ESTATE OF GUS MILIDES, :
MARY SHANNON, PERSONAL : No. 1262 EDA 2013
REPRESENTATIVE AND :
BARBARA RUSH RENKERT :
Appeal from the Judgment Entered March 18, 2013,
in the Court of Common Pleas of Northampton County
Civil Division at No. C-48-CV-2006-2450
BEFORE: FORD ELLIOTT, P.J.E., OTT AND STRASSBURGER,* JJ.
MEMORANDUM BY FORD ELLIOTT, P.J.E.: FILED AUGUST 20, 2014
Appellant appeals the order entering summary judgment against him
in his wrongful use of civil proceedings and abuse of process action against
appellees. Finding no error, we affirm.
The factual background is somewhat complex. On May 21, 1990,
Northampton County to Richard Ferrara, Theodore Ferrara, and Teddy P.
Located on the Property was a motel and restaurant that sold alcoholic
beverages.
* Retired Senior Judge assigned to the Superior Court.
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On October 3, 1992, Paul Abahazy was severely injured in a
motorcycle accident after consuming alcoholic beverages at the Property.
commenced
a Dram Shop action against RT&T by Praecipe for Writ of Summons.1
On February 9, 1994, RT&T deeded the Property back to appellant for
$1.00, but paid a realty transfer tax of $2,899.62, reflecting that the
Property had an actual value greater than $1.00. On August 21, 1997,
John Fedele. On August 31, 2000, John Sabella and Fedele deeded the
Property to Eric Schultheis and Andrew Barr.
On March 19, 2003, the trial court awarded the Abahazys a total of
$865,000 in damages in their Dram Shop action against RT&T.2 On
January 9, 2004, the Abahazys instituted an action pursuant to the
RT&T, the Ferraras individually, John Sabella, John Fedele, Eric Schultheis,
and Andrew Barr seeking to set aside the conveyances in order to use the
Property to satisfy the Dram Shop award.
On April 7, 2004, appellant filed Preliminary Objections claiming the
Property did not qualify as an asset under the PUFTA. On May 19, 2004,
1
The action was discontinued without prejudice on September 19, 1994, and
reinstated by Complaint that same day.
2
A default judgment had earlier been entered against RT&T on
September 15, 1995.
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Eric Schultheis and Andrew Barr filed a motion for judgment on the
pleadings, contending that the PUFTA action was barred by the statute of
limitations. The motion cited an October 3, 2003 decision of this court which
held that the four-year statute of limitations on a PUFTA action runs from
See K-B Building Co. v. Sheesley Construction, Inc., 833 A.2d 1132
(Pa.Super. 2003). Less than one month later, on June 15, 2004, the
Abahazys filed a praecipe to terminate the PUFTA action. From an exchange
of letters, it appears that counsel agreed that sanctions would not be sought
against the Abahazys.
On April 3, 2006, appellant instituted the present action for wrongful
attorneys, appellees herein.3 On October 15, 2012, appellees filed a motion
for summary judgment; and on March 18, 2013, the trial court granted the
motion. This timely appeal followed.
Appellant raises the following issues on appeal:
1. Did the trial court erroneously grant summary
judgment based upon oral testimony in
violation of the rule of Nanty Glo Borough v.
American Surety Co., 309 Pa. 236, 163 A.2d
523 (1932) and its progeny?
2. Did the trial court view the record in a light
most favorable to Appellant accepting as true
all well pleaded facts in his pleadings giving
him the benefit of all reasonable inferences to
3
One of those attorneys has died and is represented by his estate.
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be drawn from his pleadings and deposition
testimony?
3. Does the deposition testimony of Barbara Rush
Renkert and John R. Vivian, Jr. establish that
they believed to be a meritorious PUFTA claim
for the legitimate purpose of collecting on the
found by the trial court?
4. Should the trial court have applied the
securing the proper . . . adjudication of a
51(a)(1) in
granting Appellees summary judgment?
5. Did the trial abuse court abuse its discretion in
ruling that Appellant did not present any
Our standard of review with respect to a tria
decision to grant or deny a motion for summary
judgment is as follows:
A reviewing court may disturb the order
of the trial court only where it is
established that the court committed an
error of law or abused its discretion. As
with all questions of law, our review is
plenary.
enter summary judgment, we focus on
the legal standard articulated in the
summary judgment rule. Pa.R.C.P.
1035.2. The rule states that where there
is no genuine issue of material fact and
the moving party is entitled to relief as a
matter of law, summary judgment may
be entered. Where the non-moving
party bears the burden of proof on an
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issue, he may not merely rely on his
pleadings or answers in order to survive
summary judgment. Failure of a
nonmoving party to adduce sufficient
evidence on an issue essential to his case
and on which it bears the burden of proof
establishes the entitlement of the moving
party to judgment as a matter of law.
Lastly, we will view the record in the
light most favorable to the non-moving
party, and all doubts as to the existence
of a genuine issue of material fact must
be resolved against the moving party.
Gilbert v. Synagro Cent., LLC, 90 A.3d 37, 41-42 (Pa.Super. 2014),
quoting JP Morgan Chase Bank, N.A. v. Murray, 63 A.3d 1258, 1261-
1262 (Pa.Super. 2013).
Although appellant sets forth his appellate claims as five separate
issues, his central theory is that the trial court erred in granting summary
adduce sufficient evidence that
appellees acted with an improper purpose when they filed the PUFTA lawsuit.
We will first review this central theory.
The trial court found that a failure to show evidence of improper
purpose established an entitlement to summary judgment as to both
wrongful use of civil proceedings and abuse of process. (See Opinion of the
Court, 3/18/13 at 10-11 (wrongful use of civil proceedings); Pennsylvania
Rule of Appellate Procedure 1925(a) Statement, 6/6/13 at 4 (abuse of
process).)
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Indeed, both of the torts of wrongful use of civil proceedings and
proven:
§ 8351. Wrongful use of civil proceedings
(a) Elements of action.--A person who takes part
in the procurement, initiation or continuation of
civil proceedings against another is subject to
liability to the other for wrongful use of civil
proceedings:
(1) He acts in a grossly negligent
manner or without probable cause
and primarily for a purpose other
than that of securing the proper
discovery, joinder of parties or
adjudication of the claim in which
the proceedings are based; and
(2) The proceedings have terminated
in favor of the person against
whom they are brought.
42 Pa.C.S.A. § 8351(a) (underlining emphasis added).
of legal process against another primarily to
accomplish a purpose for which it is not designed.
To establish a claim for abuse of process it must be
shown that the defendant (1) used a legal process
against the plaintiff, (2) primarily to accomplish a
purpose for which the process was not designed; and
(3) harm has been caused to the plaintiff.
Lerner v. Lerner, 954 A.2d 1229, 1238 (Pa.Super. 2008) (underlining
emphasis added), quoting Shiner v. Moriarty, 706 A.2d 1228, 1236
(Pa.Super. 1998), appeal denied, 729 A.2d 1130 (Pa. 1998).
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In response to the motion for summary judgment, appellant filed an
to cover up their alleged malpractice in failing to timely file the PUFTA
lawsuit:
9. Malice shown by allegation of an improper
purpose in an actual conflict of interests with
their clients in an attempt to cover-up their
$865,000.00 legal malpractice resulting from
their failure to file their fraudulent transfer
claims with[in] the period of repose/limitations
mandated by 12 P.S. § 5109 knowing that they
12/19/12 at 3.
We agree with the trial court that there is no evidence of an improper
purpose in the filing of the PUFTA action and that it was filed simply to
not submitted any evidence that appellees had any other purpose. For
instance, there is no indication that appellees intended to harass appellant or
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hoped to improperly gain some unrelated legal advantage.4 As examined
infra, even if appellees were aware that the PUFTA action was beyond the
statute of limitations when they filed it, that is not evidence of an improper
purpose.
The facts also suggest that appellees were simply unaware at the time
of filing the PUFTA action, of the then recent decision in K-B Building that
rendered the PUFTA action untimely under the statute of limitations. This is
borne out by the fact that appellees withdrew their PUFTA suit less than a
month after Schultheis and Barr filed their motion for judgment on the
pleadings citing K-B Building. While the trial court
lack of knowledge of K-B Building when they filed the PUFTA action met the
4
If, however, the attorney acts without probable
cause for belief in the possibility that the claim will
succeed, and for an improper purpose, as, for
example, to put pressure upon the person proceeded
against in order to compel payment of another claim
of his own or solely to harass the person proceeded
against by bringing a claim known to be invalid, he is
subject to the same liability as any other person.
Korn v. Epstein, 727 A.2d 1130, 1133 (Pa.Super. 1999), appeal denied,
743 A.2d 921 (Pa. 1999), quoting Restatement (Second) of Torts § 674,
comment d.
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not find that that same ignorance could be used to impute an improper
purpose. We again agree.5
on appeal. Appellant complains that the trial court violated the rule in
Borough of Nanty-Glo v. American Surety Co. of New York, 163 A. 523
(Pa. 1932). Nanty-Glo essentially holds that summary judgment cannot be
based upon testimony offered by the moving party as the credibility of such
grant of summary judgment was based upon the oral testimony of appellee
Renkert.
We do not find that summary judgment was based on appellee
Dram Shop award. (Rule 1925(a) Statement, 6/6/13 at 5-7.) The trial
court also stated that appellant had supplied no evidence of a different
purpose. (Id. at 6.) The trial court then merely stated that appellee
Id. at 7.) Thus, the
5
We note that there are cases that state that an improper purpose may be
inferred from a lack of probable cause. See Buchleitner v. Perer, 794
A.2d 366, 377 (Pa.Super. 2002), appeal denied, 808 A.2d 568 (Pa. 2002),
citing Amicone v. Shoaf, 620 A.2d 1222 (Pa.Super. 1993). However, we
are aware of no case making such a finding required. Further, as the
Legislature made lack of probable cause and improper purpose separate
elements for wrongful use of civil proceedings, it would appear that the
statute regards them as distinct elements requiring independent proof of
both.
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upon a separate analysis.
Appellant next contends that his testimony that appellees filed the
PUFTA suit to cover up their malpractice constituted evidence of an improper
purpose. Appellant is confusing his own self-serving opinion with evidence.
Appellant was not a witness to any event that served to reveal that
appellees were operating with an improper purpose when they filed the
PUFTA action. Appellant merely surmises from the surrounding facts that
appellees were acting with an improper purpose, but appellant fails to
indicate what surrounding fact compels this conclusion. Simply stated,
Appellant next complains that none of the appellees testified as to
conclusion that they did not act with an improper purpose is not supported
by the evidence. Appellees are not obligated to show that they had a proper
purpose; rather, appellant is obligated to prove an improper purpose. The
obligation. Appellant failed to adduce evidence of an improper purpose.
Ev
was beyond the statute of limitations when they filed it, that does not prove
or indicate in the slightest that their purpose was other than to attempt to
preserve assets to satisfy
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Appellant next argues that the trial court erred in employing an
other than the securing of the proper . .
no substantive difference between these tests. Indeed, the trial court stated
purpose other than the securing of the proper . .
(Rule 1925(a) Statement, 6/6/13 at 7.)
evidence proves the element of lack of probable cause it compels the
inference of improper purpose, we disagree. As previously noted, cases
have held that where there is a lack of probable cause, an improper purpose
may be inferred. We are aware of no case that compels the inference.
ellees should have
been aware of K-B Building and that the statute of limitations was an
obstacle to the success of such action. We agree with the trial court that
this failure by appellees does not merit the inference of an improper purpose
in filing the suit.
Even if appellees were demonstrably aware of K-B Building and the
statute of limitations, we would find a lack of probable cause, but not an
inference of improper purpose. The statute of limitations is not an absolute
bar to bringing a successful suit. If it were, then an inference of improper
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purpose might be justified. However, the statute of limitations is merely an
affirmative defense that must be pleaded. Pa.R.C.P., Rule 1030(a),
42 out the
possibility of success and does not merit an inference of improper purpose.
Moreover, as appellees argue, an attorney could still in good faith file a
PUFTA action knowing it was untimely under K-B Building, in order to
appeal the decision and argue for the reversal of K-B Building.
Finally, appellant argues the trial court,
that the February 9, 1994 deed to Appellant was a
fraudulent transfer and apply res adjudicata to the
RT&T defendants who were named as parties in the
Dram Shop suit and apply collateral estoppel to
Appellant who was not a party in the Dram Shop
suit;
During their Dram Shop suit, the Abahazys had requested that the
court pierce the corporate veil of RT&T and find the individual owners liable
based upon the fraudulent transfer of the Property back to appellant.
Judge Michael V. Franciosa declined to do so because appellees had failed to
prove a fraudulent transfer. Appellant appears to be arguing that the
Dram Shop decision precluded the subsequent PUFTA action either through
res judicata
Statement of Matters Complained of on Appeal; consequently, the issue is
waived. Pa.R.A.P., Rule 1925(b)(4)(vii), 42 Pa.C.S.A.
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In sum, we agree with the trial court that appellant presented no
evidence that appellees instituted the PUFTA action for an improper purpose.
Without such evidence, appellant could not maintain a suit for either
wrongful use of civil proceedings or abuse of process. Summary judgment
was properly entered.
Order granting summary judgment affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 8/20/2014
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