AMA American Marketing v. Redev. Auth. of Mont Cty ( 2020 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
AMA AMERICAN MARKETING : IN THE SUPERIOR COURT OF
ASSOCIATION INC, AMBLER : PENNSYLVANIA
CROSSINGS DEVELOPMENT :
PARTNERS #1 LLC AND ARNOLD :
FRUMIN :
:
:
v. :
: No. 3319 EDA 2019
:
REDEVELOPMENT AUTHORITY OF :
THE COUNTY OF MONTGOMERY, :
AMBLER BH DEVELOPMENT :
PARTNERS LP, AMBLER BH LLC, :
AMBLER CROSSINGS DEVELOPMENT :
PARTNERS LP, ROBERT BAST, :
WILLIAM L. BAST, ESTATE OF :
ROBERT L BAST, RODERICK W. :
GAGNE, MAPLE AVENUE PARK INC., :
MAPLE AVENUE PARK PARTNERS LLP, :
REDEVELOPMENT AUTHORITY OF :
MONTGOMERY COUNTY NEW :
MARKET CORPORATION, SUMMIT :
REALTY LLC, JOHN ZAHARCHUK :
Appeal from the Judgment Entered November 1, 2019
In the Court of Common Pleas of Montgomery County Civil Division at
No(s): #2014-04500
BEFORE: PANELLA, P.J., McLAUGHLIN, J., and McCAFFERY, J.
MEMORANDUM BY McLAUGHLIN, J.: FILED DECEMBER 21, 2020
AMA/American Marketing Association (“AMA”), Ambler Crossings
Development Partners #1, LLC (“ACDP#1”), and Arnold Frumin appeal from
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the judgment entered against them.1 Appellants’ arguments mainly challenge
the trial court’s findings of fact. We affirm based on the trial court’s opinion.
See Pa.R.A.P. 1925(a) Op., filed 1/13/20.2
AMA is a corporation with a sole shareholder, Arnold Frumin. Frumin
also was a member of ACDP#1. Appellants instituted this suit and filed a
Complaint alleging, in general terms, that an agreement existed to obtain
funds from the Redevelopment Authority of Montgomery County (“RDA”) to
redevelop property. Defendants included the RDA, Robert Bast, and two
entities Bast controlled, Maple Avenue Park Partners LLP (“MAPP LLP”) and
Maple Avenue Park, Inc. (“MAPP Inc.”). Frumin and Bast were members of
ACDP#1. The Complaint contained seven counts and asserted claims of breach
of contract, tortious interference in contractual relations, and breach of
fiduciary duty. It also sought a declaration that AMA had certain easement
rights and asked the court to enjoin interference with those rights.
The case proceeded to trial and at the close of Appellants’ case in chief,
the trial court entered a compulsory nonsuit on several counts. Following trial,
the court rendered a decision against Appellants on their remaining claims.
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1 Appellants purported to appeal from the October 2, 2019 order denying post-
trial motions. However, in a civil case, the appeal lies from the judgment
entered following the denial of post-trial motions. See Mount Olivet
Tabernacle Church v. Edwin L. Wiegand Div., 781 A.2d 1263, 1266 n.3
(Pa.Super. 2001). We have corrected the caption accordingly.
2The trial court incorporated by reference its findings of facts and conclusions
of law from its 31 page decision, dated September 6, 2019, following a six
day non-jury trial. See 1925(a) Op. at 1, 2; Decision, dated 9/6/19.
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Appellants filed post-trial motions that included a request to remove the
nonsuits. The trial court denied the post-trial motions, and Appellants entered
judgment and filed this appeal. They raise the following issues:
1. Did the trial court commit an error of law denying AMA’s
request for declaratory relief that the defendants’
development constituted a breach of the easement in
Exhibit P-99?
2. Did the trial court commit an error of law in finding that
BAST/MAPP and Frumin/AMA did not have an agreement
to obtain $5 MM in RACP funds through the entity
ACDP#1?
3. Did the trial court commit an error of law in finding that
the RDA did not enter into a subgrant agreement with
ACDP#1?
4. Did the trial court commit an error of law in finding that
developing defendants did not tortiously interfere with
ACDP#1’s agreement with the RDA?
5. Did the trial court commit an error of law in finding that
Zaharachuk and his entities did not tortiously interfere
with the agreement between BAST/MAPP and
Frumin/AMA?
6. Were the determinations of the trial court contrary to and
against the weight of the evidence?
Appellants’ Br. at 4.
On review of a judgment rendered following a bench trial, we determine
“whether the findings of the trial court are supported by competent evidence
and whether the trial court committed error in any application of the law.”
Bank of N.Y. Mellon v. Bach, 159 A.3d 16, 19 (Pa.Super. 2017) (quoting
Stephan v. Waldron Elec. Heating and Cooling LLC, 100 A.3d 660, 664-
65 (Pa.Super. 2014)). We give a judge’s findings of fact the same weight and
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effect on appeal as a jury verdict, and we consider the evidence in a light most
favorable to the verdict winner. Id. We reverse the court’s factual findings
only if the record does not support them or if the court based them on an error
of law. Id. However, as to questions of law, our standard of review is de novo
and our scope of review is plenary. Id.
In their first issue, Appellants claim that the trial court erred in denying
the request for a declaration that the development constituted a breach of an
easement. Appellants’ Br. at 15. Appellants cite Plaintiff’s Exhibit 99 (“P-99”),
which allegedly displayed a driveway easement. Id.
The trial court determined that “[i]n order to show that their easement
right or right of access had been unlawfully blocked, AMA and Frumin had the
burden of showing the location of the easement or access route.” 1925(a) Op.,
filed 1/13/20, at 10. The court concluded that the evidence did not establish
the easement because P-99 “was mostly illegible and plainly insufficient to
establish the boundaries of any such rights.” Id. It explained that there was
“[n]o metes-and-bounds description of any easement or right of access” or
any “map or diagram presented that established the location of [AMA’s]
asserted property rights.” Id. On review of P-99, we conclude that the court’s
findings are supported by the record and find no error of law.
Next, Appellants argue that the trial court erred in finding that Bast and
Frumin did not have an agreement to form ACDP#1. Appellants’ Br. at 17.
They maintain that based on the doctrine of necessary implication, “Bast and
Frumin had agreed to form an entity, ACDP#1 to be the Sub-Grantee and
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execute the agreement for the [redevelopment] funds with the RDA and divide
the access to those funds equally.” Appellants’ Br. at 18. Thus, Appellants
argue that the trial court erred in failing to applying the doctrine of necessary
implication in coming to its conclusion that no agreement existed between
Bast and Frumin to form ACDP#1.
The doctrine of necessary implication enables a court, in the absence of
an express contract provision, to infer that the parties agreed “to do and
perform those things that according to reason and justice they should do in
order to carry out the purpose for which the contract was made,” and not to
do “anything that would destroy or injure the other party’s right to receive the
fruits of the contract.” Somers v. Somers, 613 A.2d 1211, 1214 (Pa.Super.
1992) (citation omitted). “Courts employ the doctrine of necessary implication
as a means of avoiding injustice by inferring contract provisions that reflect
the parties’ silent intent.” Stamerro v. Stamerro, 889 A.2d 1251, 1259
(Pa.Super. 2005) (quoting Palmieri v. Partridge, 853 A.2d 1076, 1079
(Pa.Super. 2004)). However, the doctrine is not a means for overriding a
contract’s express provisions. Id.
Here, the trial court concluded that “the discussions between Bast and
Frumin never matured to the point of a binding contract between them.”
1925(a) Op. at 3. The trial court pointed out that although Bast signed an
agreement to distribute funds received from the RDA (“the Sub-Grant
Agreement”), he listed “seven conditions to be met before his signed copy of
the Sub-Grant Agreement could be delivered to the RDA,” including “Bast’s
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review of the formation documents for ACDP#1 and review of the application
of the [Pennsylvania Office of the Budget (“OB”)] for a change of the name of
the subgrantee.” Id. at 2. The court found as facts that Frumin did not satisfy
Bast’s conditions for delivery of the Sub-Grant Agreement, but nonetheless
“signed the Certificate of Organization for ACDP#1 and had it filed with the
Department of State.” Id. The court further found that he did so “without
authorization from Bast . . . and without sending to Bast two documents
requiring his signature- the Limited Liability Operating Agreement for ACDP#1
and the Authorization to File a Certificate of Organization.” Id. at 2-3. The
record supports the court’s findings and we find no error of law.
Appellants next contend that there was a sub-grant agreement between
RDA and ACDP#1. The trial court rejected this claim as “contrary to the
documentary record.” 1925(a) Op. at 5. The court first acknowledged that
there were two signed sub-grant agreements. The first was signed by Frumin
only and “between RDA and [Ambler Crossings Development Partners, LP],
not ACDP#1.” Id. The second was signed by Bast, “pending the satisfaction
of the conditions in Bast’s Memorandum of Understanding.” Id. The second
version was purportedly between RDA and ACDP#1, as Frumin signed on
behalf of ACDP#1. However, the court found that when Bast signed the second
version, he “did not intend for his signature to be effective until his express
conditions had been satisfied.” Id.
Furthermore, the court concluded that under the grant agreement, RDA
could not “enter into a subgrant without the prior written consent of the OB.”
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Id. at 6. Since the OB authorized a sub-grant with ACDP, not ACDP#1, the
trial court concluded that “there was no effective Sub-Grant Agreement
between ACDP#1 and the RDA.” Id. Upon a review of the record and the
parties’ briefs, we conclude that the record supports the trial court’s findings
of fact and it did not commit an error of law in rejecting this claim.
Appellants also argue that the trial court erred in determining that the
developing defendants did not tortiously interfere with ACDP#1’s subgrant
agreement with RDA. As we have concluded that the trial court did not err in
concluding that no such agreement existed, we reject this claim.
Appellants further argue that the trial court erroneously concluded that
the developing defendants did not tortiously interfere with the alleged
agreement between Bast and Frumin. Like the previous issue, this issue fails
as the trial court properly concluded that no such agreement existed.
For its final claim, Appellants maintain that the trial court’s conclusions
were against the weight of the evidence. Appellants provide no argument on
this issue. They therefore waived it. See Pa.R.A.P. 2119(a); Umbelina v.
Adams, 34 A.3d 151, 161 (Pa.Super. 2011) (“[W]here an appellate brief fails
to provide any discussion of a claim with citation to relevant authority or fails
to develop the issue in any other meaningful fashion capable of review, that
claim is waived.” In re W.H., 25 A.3d 330, 339 n.3 (Pa.Super. 2011). After a
review of the record, the parties’ briefs, and the relevant law, we affirm on
the basis of the well-reasoned opinion of the Honorable Jeffrey S. Saltz.
Order affirmed.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 12/21/20
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2014-04500-0230 07:45 Page
Opinion, AM 1
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IN THE COURT OF COMMON PLEAS OF MONTGOMERY COUNTY, PENNSYLVANIA
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REDEVELOPMENT AUTHORITY OF THE COUNTY
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8 I. PROCEDURAL HISTORY
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to Pa. R.A.P. 1925(b)” (“Statement of Matters”). The present Opinion is being filed in
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Bast or MAPP, on the one hand, and Frumin or AMA, on the other hand, for the formation of
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Organization for ACDP#1 and had it filed with the Department of State. He did so without
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$0.00. The filer certifies that this filing complies with the provisions of the Public Access Policy of the
application to the OB, and without sending to Bast two documents requiring his signature — the
Limited Liability Operating Agreement for ACDP#1 and the Authorization to File a Certificate
of Organization.
It is true that Frumin and Bast had an informal understanding that they would divide
between themselves (or their companies) the $5 million in RACP funds that they anticipated
receiving. The details of that understanding, however, were never developed and agreed to
between them. To the contrary, Bast’s Memorandum of Understanding made clear that, until the
specified conditions were met, he was not prepared to make a contractual commitment to
Frumin. In particular, Bast’s execution of the Sub-Grant Agreement was qualified by the proviso
in his Memorandum that the Agreement was not to be delivered to the RDA until his conditions
had been satisfied. Thus, Bast’s execution of the Sub-Grant Agreement did not indicate a
contractual intent to be legally bound at that time.
In short, the evidence was compelling that the discussions between Bast and Frumin
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never matured to the point of a binding contract between them.
B. The Effect of the Agreement of Frumin and Bast to Part Ways
As the Court made clear in its Decision, even if there was a contract between Frumin and
Bast (or their companies), it was rescinded by their agreement, reached in October 2011 and
reconfirmed in May 2012, to go their separate ways. In their Statement of Matters, Plaintiffs
acknowledge that Frumin and Bast agreed to develop the AMA and MAPP Properties separately,
but they contend that the commitment to divide between them the anticipated $5 million in
RACP funds survived that agreement. Plaintiffs’ contention is mistaken for several reasons.
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$0.00. The filer certifies that this filing complies with the provisions of the Public Access Policy of the
First, as explained above, the discussions between Frumin and Bast to divide the RACP
funds was an informal understanding — a working assumption that would gel into a binding
agreement only at such time as the details were filled in and agreed to. That time never arrived.
Of equal importance, Plaintiffs’ interpretation of the agreement to part ways is based on
unrealistic hair-splitting: it argues that even though Frumin and Bast agreed to abandon the joint
development of their parcels, they still intended to share evenly the $5 million in RACP funds.
If Frumin and Bast had intended, despite their agreement to proceed separately, to nevertheless
maintain a continuing binding commitment to share in the RACP funds, they surely would have
expressed that ongoing obligation. The written communications between them reflect no such
distinction. To the contrary, on November 2, 2011, Bast confirmed to Frumin that:
we have no obligations whatsoever to one another with respect to the
development of our contiguous parcels of land off Maple Avenue in the Borough
of Ambler, Montgomery County, PA. Therefore, each of us is free to proceed
separately with the future use and development of our said separate parcels. We
may, of course, take such actions with respect to such development which we may
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both agree, in writing, to be in our mutual best interests. [D-93 (emphasis
added).]
Bast did note a limitation on their agreement — i.e., that they may take future joint actions that
they agree to be mutually beneficial. Significantly, he did not add a further limitation that the
RACP funds would still be divided between them.
Even after the RDA urged Frumin and Bast to reconsider separating and instead to enter a
tri-party agreement with Zaharchuk, they concluded that they would nevertheless sever their ties.
On May 7, 2012, following the collapse of negotiations on a tri-party agreement, Bast
reconfirmed in writing that there were “no ongoing contractual agreements or arrangements”
between them. (D-126.)
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$0.00. The filer certifies that this filing complies with the provisions of the Public Access Policy of the
Thus, the Plaintiffs’ position that Frumin and Bast not only entered into a binding
contract to divide the RACP funds, but that the contract survived their subsequent agreement to
go their separate ways, is not supported by the evidence.
Cc. No Effective Sub-Grant Agreement with RDA
Plaintiffs’ assertion of a legally effective Sub-Grant Agreement between the RDA and
ACDP#! is contrary to the documentary record. As set forth in detail in the Court’s Decision,
two different versions of a purported Sub-Grant Agreement were signed in August 2011. (P-76.)
The first version, signed by Frumin, was between the RDA and ACDP, not ACDP#1. Frumin
signed it on behalf of ACDP, but he had no authority to do so.' See, e.g., Walton v. Johnson, 66
A.3d 782 (Pa. 2013) (contract signed by purported agent who lacked authority is unenforceable).
The second version, signed by Bast, was delivered by Bast to Frumin or his counsel for
safekeeping, pending the satisfaction of the conditions in Bast’s Memorandum of Understanding.
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It therefore should not have been delivered to the RDA, and Frumin cannot enforce a purported
Agreement that he had no authority to deliver to the other party to the Agreement. Further, while
this second version was purportedly between ACDP#! and the RDA, Frumin did not have Bast’s
authority to form ACDP#1, again until the conditions in the Memorandum of Understanding had
been met. In short, the signer of the second version did not intend for his signature to be
effective until his express conditions had been satisfied. Frumin could not override Bast’s
intention by delivering the document to the RDA prematurely and without authorization.
' At an earlier point in his dealings with the RDA, Frumin had confirmed the willingness of Zaharchuk to
transfer ACDP to him and Bast. But in March 2011, by the time that the Sub-Grant Agreements were
signed, Frumin and Bast had abandoned that approach and decided instead to create a new entity. (P-35;
Findings of Fact, F¥j 91-95.)
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Partners,” without an “LP” at the end. (D-68.) The printed Sub-Grant Agreement referred to the
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sg D. Impact of Environmental Issues
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funding and the overall project could not successfully proceed with the participation of Frumin
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Property. (Findings of Fact, 4 136-137.)
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Case# 2014-04500-230 Docketed at Montgomery County Prothonotary on 01/13/2020 2:44 PM, Fee
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Unified Judicial System of Pennsylvania: Case Records of the Appellate and Trial Courts that require filing confidential information and documents differently than non-confidential information and documents. 2014-04500-0230 Opinion, Page 9
$0.00. The filer certifies that this filing complies with the provisions of the Public Access Policy of the
Maverick Steel Co. v. Dick Corp./Barton Malow, 54 A.3d 352, 354-55 (Pa. Super. 2012).
Initially, as discussed above, there was no contract between Frumin or ACDP#1 and the
RDA. But even if there were such a contract (or if there might be a prospective contractual
relation), Plaintiffs failed to establish the third element of the tort — the absence of privilege or
justification. Zaharchuk and Bast were reasonably concerned that if Frumin and AMA remained
a part of the joint development project, the entire project could lose its RACP funding because of
Frumin’s failure to timely pursue environmental remediation of the AMA Property. This failure
persisted despite repeated communications by Gagné, on behalf of Bast, that environmental
remediation of the AMA Property was critical to any joint development. (Findings of Fact,
{| 125-132.) The Court concluded from the evidence that the concerns by Zaharchuk and Bast
were genuine and objectively justified. (Conclusions of Law, ¢ 13.) Further, the reallocations of
funds by the RDA, made at Zaharchuk’s behest, were permissible under the terms of the Grant
Case# 2014-04500-230 Docketed at Montgomery County Prothonotary on 01/13/2020 2:44 PM, Fee
Agreement and OB procedures. (Conclusions of Law, Jf 11-12.)°
Accordingly, the Court held that Zaharchuk and Bast were not liable to Plaintiffs for
tortious interference with contract.
F, Nonsuit on Plaintiffs’ Easement Claims
At the close of the Plaintiffs’ evidence, the Court granted a compulsory nonsuit on
Counts VI and VII of the Complaint, alleging that certain Defendants had interfered with
Frumin’s and AMA’s rights of easement and access under declarations and covenants established
in the Nicolet Subdivision. The nonsuit was granted on the basis of a straightforward lack of
° Plaintiffs also suggest in paragraph 5 of their Concise Statement that Bast’s conduct constituted a breach
of his fiduciary duty to Frumin. As discussed above, Frumin and Bast never consummated the formation
of an entity (such as ACDP#!1) that would give rise to a fiduciary duty between them. Even if such a duty
somehow arose, it was terminated when Frumin and Bast agreed to go their separate ways.
Unified Judicial System of Pennsylvania: Case Records of the Appellate and Trial Courts that require filing confidential information and documents differently than non-confidential information and documents. 2014-04500-0230 Opinion, Page 10
$0.00. The filer certifies that this filing complies with the provisions of the Public Access Policy of the
proof of the specific property rights that Plaintiffs contend were invaded. No metes-and-bounds
description of any easement or right of access was presented. Nor was a map or diagram
presented that established the location of Plaintiffs’ asserted property rights. A copy of the
Nicolet Subdivision Plan was introduced, but it was mostly illegible and plainly insufficient to
establish the boundaries of any such rights. In order to show that their easement right or right of
access had been unlawfully blocked, AMA and Frumin had the burden of showing the location
of the easement or access route. There was no showing that a legible version of the Subdivision
Plan, issued in 1988 (Compl., § 90), could not be obtained. Cf Shaffer v. Baylor’s Lake Ass'n,
141 A.2d 583, 587 (Pa. 1958) (“It is often difficult to prove the exact extent or boundaries of an
ancient right or easement, and consequently the law is realistic and does not require the same
minutiae of proof as is required in cases where ample proof is or should be available.) (former
emphasis by the Court; latter emphasis added). Therefore, on this failure of proof, a compulsory
nonsuit was granted.
Case# 2014-04500-230 Docketed at Montgomery County Prothonotary on 01/13/2020 2:44 PM, Fee
G. Partial Nonsuits on Counts I Through Ill
Finally, Plaintiffs challenge the grant of compulsory nonsuits against AMA on Counts |
and III of the Complaint and against AMA and Frumin on Count IL.’ None of these nonsuits
resulted in the dismissal of any count as a whole. Rather, the nonsuits were granted against
specific Plaintiffs who could not establish a claim on their own behalf.
On Count I, asserting a breach of contract by the RDA, there was no evidence whatsoever
of any contract between AMA and the RDA; therefore a nonsuit was entered against AMA on
7 To be precise, the Statement of Matters challenges the “compulsory non-suit of AMA in counts I and II
[sic] and AMA and FRUMIN to Count II.” (Statement of Matters, ] 7.) Because of the redundant
references to Count II, it is assumed that the reference to “counts | and II” was intended to be to Counts I
and [I.
10
Unified Judicial System of Pennsylvania: Case Records of the Appellate and Trial Courts that require filing confidential information and documents differently than non-confidential information and documents. 2014-04500-0230 Opinion, Page 11
$0.00. The filer certifies that this filing complies with the provisions of the Public Access Policy of the
Count I. Likewise, Count II alleged tortious interference with a contract between ACDP#I and
the RDA. There was no evidence of a contract between AMA or Frumin individually and the
RDA; therefore, a nonsuit was entered against AMA and Frumin on Count I. Finally, on Count
II, alleging tortious interference with a contract with Bast and/or MAPP, the evidence was clear
that any contract of this nature was between Frumin and Bast, not between AMA and MAPP,
and therefore a nonsuit was entered against AMA.
Each of these counts was permitted to proceed on behalf of the specific Plaintiff that
arguably did have a relevant contract. Thus, a nonsuit was denied against ACDP#1 on Counts I
and II and against Frumin on Count III. Of course, after the presentation of all the evidence and
the written and oral arguments of counsel, the Court decided on the merits against these
remaining Plaintiffs on all three counts. Thus, even if the partial nonsuits had not been granted,
all three counts would have been decided against all Plaintiffs.
Case# 2014-04500-230 Docketed at Montgomery County Prothonotary on 01/13/2020 2:44 PM, Fee
Il. CONCLUSION
This case involved many days of dense testimony and several volumes of exhibits. The
Court gave careful consideration to all of the evidence and the arguments of counsel. For the
reasons set forth in the Court’s Decision, as supplemented by the discussion above, the Court
concluded that Plaintiffs did not prove any of the claims set forth in their Complaint.
BY THE COURT:
11
2014-04500-0230 Opinion, Page 12
12
George Cardenas george@montgomerybar.org
Elizabeth Catalano, Court Administration
Copies mailed on 1/ /3 /20 to
Copy emailed on 1//3 /20 to:
Efiled on 1/43/20
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