Lafferty, H. v. Ferris, T. ( 2019 )

J -A16001-19
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
HARRY J. LAFFERTY, MICHAEL D. IN THE SUPERIOR COURT OF
KIRN, ROBERT T. KIRN, JOHN J. PENNSYLVANIA
ROEDELL, JOHN M. FERRIS, ROBERT :
F. FERRIS, & FACOWEE ACRES, LLC. :
v.
No. 2024 MDA 2018
THOMAS D. FERRIS
Appellant
Appeal from the Order Entered November 28, 2018
In the Court of Common Pleas of Susquehanna County Civil Division at
No(s): 2008-1941 CP
BEFORE: LAZARUS, J., MURRAY, J., and STEVENS*, P.J.E.
MEMORANDUM BY LAZARUS, J.: FILED: JULY 22, 2019
Thomas D. Ferris (Ferris) appeals from the November 28, 2018 order
entered in the Court of Common Pleas of Susquehanna County. After careful
review, we vacate.
In August 1998, Ferris and Appellees/Defendants created Facowee
Acres, LLC (Facowee Acres), a limited liability company. On October 4, 1998,
Ferris and his brother, Robert Ferris (Robert) (collectively, Brothers), executed
an agreement of sale for a 100 -acre parcel of land in Susquehanna County
(Property), with the intent that the land would be used as a hunting lodge for
members of Facowee Acres. Appellees and Ferris (collectively, Members)
comprised the membership of Facowee Acres. In December 1998, the
Brothers executed a mortgage on the Property; the property was deeded to
Former Justice specially assigned to the Superior Court.
J -A16001-19
them as tenants -in -common. Each of the members of Facowee Acres orally
agreed to pay, over time, the mortgage and other related costs for the
Property. Upon payment in full by the Members, the Brothers would transfer
the Property to the members, who would then transfer the Property to
Facowee Acres.
In 2004, Ferris purchased a 4.4 -acre parcel adjacent to the Property
(Adjacent Property) in his own name. The members of Facowee Acres agreed
to reimburse Ferris the full purchase price of the Adjacent Property. Ferris
subsequently transferred title to the Adjacent Property to himself and his
brother, Robert. Over the years, Facowee Acres members used the Property
and Adjacent Property for hunting. Improvements were also made on the
Property. In October 2004, the deed to the Property and the deed to the
Adjacent Property were consolidated into one deed.'
In 2007, Ferris told the Members that he wanted to sell back his interest
in Facowee Acres. However, Ferris refused to convey the properties to the
Members, in accordance with their prior oral agreement. Further, without the
consent of the other members of Facowee Acres, the Brothers used the
Property and the Adjacent Property as collateral for a $125,000 equity line of
credit for their own benefit. Additionally, in August 2008, for an up -front
1- Over time, payments made by the Members were deposited into a bank
account owned by Robert. Expenses for the properties, including real estate
taxes and maintenance expenses, were paid from that account. All of the
Members, excluding Ferris, paid their respective shares of the mortgage and
related expenses. Lafferty v. Ferris, Nos. 1131 & 1619 MDA 2016 (Pa.
Super. filed Sept. 21, 2017), at 3.
-2
J -A16001-19
payment of $28,500, the Brothers executed a natural gas lease with
Chesapeake Appalachia, LLC (Chesapeake) for the Property and Adjacent
Property.
On December 23, 2008, Appellees initiated the instant action in equity
against Ferris seeking reformation of the deed to include their names; the
complaint also included counts for unjust enrichment, promissory estoppel,
and breach of contract. The complaint alleged that "[t]he members of
Facowee Acres, including but not limited to, defendant Thomas D. Ferris,
intended and agreed that subsequent to the purchase of the Property, the
Deed to Robert F. Ferris and Thomas D. Ferris would be reformed to reflect
the names of all of the members of Facowee Acres as owners of the Property."
Complaint, 12/23/08, at ¶ 21. Ferris filed an answer and counterclaim
averring that he is not a member of Facowee Acres, denying any oral
agreements existed in relation to reforming the deed to reflect Facowee Acres
as the true owner of the properties, and seeking "a fair and equitable partition
of the [Property and the Adjacent Property]." Ferris Counterclaim, 4/3/09, at
8.
Following a non -jury trial, the court entered an order determining that
an enforceable oral agreement existed between Ferris and Appellees.
Accordingly, on January 11, 2016, the court entered an order dismissing
Ferris's counterclaim and directing the Brothers execute a special warranty
deed conveying title to the Property and the Adjacent Property to Appellees
and Ferris, in their respective proportionate shares. Ferris was also ordered
-3-
J -A16001-19
to pay any unpaid principal and interest in connection with the mortgage
within 30 days of the order, and the county prothonotary was directed to
"release all monies, principal and accumulated interest escrowed pursuant to
Court Order relating to this matter to Facowee Acres, LLC, Robert F. Ferris and
Thomas D. Ferris within (30) days of this Order." Order, 1/11/16, at ¶ 3.2
Finally, the order designated the respective interests of the parties with regard
to the special warranty deed and the oil and gas lease as follows: Lafferty
(1/9th); M. Kim (1/9th, );- Roedell (1/9th); John J. Ferris (1/9th); Ferris (1/9th);
R. Kim (1/9th); and Robert F. Ferris (3/9th).
On January 20, 2016, Ferris filed a post -trial motion for a new trial,
raising 40 claims of trial court error. On May 31, 2016, Appellees filed a
praecipe to enter judgment. See Pa.R.C.P. 227.4(b).3 On June 27, 2016, the
trial court entered an order denying Ferris's post -trial motions. On July 13,
2 The January 11, 2016 order also ordered the Brothers to "assign all their
stated interest in an oil and gas lease regarding the subject properties, leased
to Chesapeake Appalachia, L.L.C.[,] its successors and assigns, to the
grantees of the special warranty deed called for in paragraph 1 of this order
in their respective shares." Order, 1/11/16, at ¶ 4.
3 Unlike the Rules of Criminal Procedure which require a court to act within
120 days of the filing of the post -trial motion or it will be deemed denied by
operation of law, see Pa.R.Crim.P. 720(B)(3), the rules of civil procedure do
not provide a similar automatic mechanism. Rather, a party is required to
praecipe for entry of judgment to move the case forward where the court has
not decided the motion within 120 days after its filing.
-4
J -A16001-19
2016, Ferris filed a notice of appeal4 from the June 27, 2016 order.5 On August
18, 2016, while Ferris's appeal was pending, Appellees filed a motion to
enforce the trial court's January 11, 2016 order. In the motion, Appellees
alleged that "[g]iven the [c]ourt's decision recognizing the respective interest
of the Plaintiffs and the Defendant in the subject real estate . . ., distribution
of the monies, principal and accumulated interest escrowed to only Facowee
Acres, LLC, Robert F. Ferris and Thomas D. Ferris would be inconsistent with
the Order which recognizes the interests of Plaintiffs and Defendant[.]"
Plaintiffs' Motion to Enforce, 8/18/16, at '11 19. On August 23, 2016, the trial
court entered an order granting Appellees' motion to enforce.
On September 9, 2016, the court held a hearing on Appellees' motion
to enforce the judgment. At the hearing, Appellees' counsel again argued that
the court's January 11, 2016 order incorrectly directed that the monies be
distributed to three entities/people, rather than the full seven Facowee Acres
members. N.T. Motion to Enforce Hearing, 9/9/16, at 14. On September 16,
2016, the court entered an order again granting Appellees' motion to enforce,
but also modifying its January 11, 2016 order by requiring a general warranty
4 Lafferty v. Ferris, 1131 MDA 2016 (Pa. Super. filed July 13, 2016).
5 Appellees prematurely filed a notice of appeal on May 3, 2016, prior to the
disposition of Ferris's post -trial motions. Our Court quashed that appeal. See
Lafferty v. Ferris, No. 712 MDA 2016 (Pa. Super. filed June 14, 2016).
-5
J -A16001-19
deed be executed to transfer title of the property and adjacent property to
Facowee Acres. Ferris filed a notice of appeal6 from the August 23, 2016 and
September 16, 2016 orders. Our Court consolidated Ferris's two separate
appeals for ease of disposition. See Lafferty v. Ferris, Nos. 1131 & 1619
MDA 2016 (Pa. Super. filed Sept. 21, 2017) (unpublished memorandum).
On September 21, 2017, our Court concluded that the trial court lacked
jurisdiction to enter the August 23, 2016 and September 16, 2016 orders
where the trial court did not expressly grant reconsideration within 30 days
following its June 27, 2016 order denying Ferris's post -trial motion, and where
Ferris had already filed a notice of appeal divesting the trial court of
jurisdiction.7 Accordingly, we determined that the orders were void and
vacated them. Id. Appellees filed an unsuccessful motion for reargument in
this Court and unsuccessful petition for allowance of appeal with the Supreme
Court of Pennsylvania. See Lafferty v. Ferris, No. 878 MAL 2017 (Pa. filed
May 15, 2018) (order denying petition for allowance of appeal).
Appellees again orally moved to modify the trial court's January 11,
2016 order. After considering the parties' briefs on the issue, on November
28, 2018, the court granted the motion to modify, amending the third
paragraph of the January 11, 2016 order "to [now] direct that the
6 Lafferty v. Ferris, No. 1619 MDA 2016 (Pa. Super. filed Sept. 30, 2016).
Appellees filed a motion for reconsideration on August 18, 2016, titling it a
"Motion to Enforce." Again, this motion was over five months late and filed
while an appeal was pending. Accordingly, it does not cure the trial court's
lack of jurisdiction to modify the January 11, 2016 order.
-6
J -A16001-19
Susquehanna County Prothonotary release all natural gas royalty monies,
principal and interest, escrowed pursuant to court order to the parties
according to their respective interests as set forth in paragraph 7 of the
[court's] January 7, 2016 order." Trial Court Order, 11/28/18, at 411 2. On
December 17, 2018, Ferris filed a motion to reconsider that was denied two
days later. Ferris filed timely notice of appeal and court -ordered Pa.R.A.P.
1925(b) concise statement of errors complained of on appeal.
On appeal, Ferris raises the following issues for our consideration:
(1) Did the trial court commit reversible error[] by granting a
modification of its order entered January 11, 2016[,] when
the trial court had already granted in substance the same
exact modification by orders of court entered on August 23,
2016 and September 16, 2016[,] and when the Superior
Court of Pennsylvania vacated the trial court's orders of
August 23, 2016[,] and September 16, 2016[,] after the
Superior Court determined that the trial court did not have
jurisdiction to make the subject modification?
(2) Did the trial court commit reversible error[] by granting a
modification of its order entered on January 11, 2016[,]
after [the] judgment [became] final and when no timely
motion for post -trial relief or for reconsideration was filed
seeking modification as ordered by the trial court in its order
entered on November 28, 2018, and there were no
circumstances present in this case that would amount to
sufficient cause to trigger application of the exceptional
circumstances/extraordinary cause doctrine?
(3) Did the trial court commit reversible error[] by granting a
modification of its order entered on January 11, 2016[,]
when the trial court had already granted in substance the
same exact modification by orders of court entered on
August 23, 2016 and September 16, 2016[,] and when the
propriety of the trial court's attempted modification was
extensively litigated at the trial court level, before the
Superior Court of Pennsylvania[] and the Supreme Court of
-7
J -A16001-19
Pennsylvania, and the modification was determined to be
improper by both appellate courts?
Appellant's Brief, at 3-4.
In his brief, Ferris claims that the trial court improperly modified its
January 11, 2016 order where the court lacked jurisdiction to alter the order,
as no timely post -trial motion or motion for reconsideration was filed and
granted. We agree.
Throughout the course of post -trial proceedings, Appellees have
repeatedly asserted that the trial court's January 11, 2016 order erroneously
directed that the payment of escrowed natural gas royalty monies be divided
evenly among Facowee Acres, LLC, Robert Ferris and Thomas Ferris8 rather
than to all members, consistent with their specific interest in the proceeds. In
an attempt to address this concern, the trial court modified its original January
11, 2016 order on August 23, 2016, September 16, 2016, and again on
November 28, 2018.
It is well -established that a court may modify or rescind any order within
30 days after its entry, if no appeal has been taken. See Pa.R.A.P. 1701; 42
Pa.C.S. § 5505. However, a trial court may not ordinarily modify an order
beyond the thirtieth day after its entry, except as otherwise provided by law.
8 In the original January 2016 order, paragraph 3 reads:
3. The Susquehanna Prothonotary release all monies, principal
and accumulated interest escrowed pursuant to Court Order
relating to this matter to Facowee Acres, LLC, Robert F. Ferris and
Thomas D. Ferris within (30) days of this Order.
Trial Court Order, 1/7/16.
-8
J -A16001-19
Pursuant to Pa.R.A.P. 1701:
(a) General rule. Except as otherwise prescribed by these rules,
after an appeal is taken or review of a quasijudicial order is
sought, the trial court or other government unit may no longer
proceed further in the matter.
(b) Authority of a trial court or agency after appeal. After an
appeal is taken or review of a quasijudicial order is sought, the
trial court or other government unit may:
(1) Take such action as may be necessary to preserve the
status quo, correct formal errors in papers relating to
the matter, cause the record to be transcribed, approved,
filed and transmitted, grant leave to appeal in forma
pauperis, grant supersedeas, and take other action
permitted or required by these rules or otherwise ancillary
to the appeal or petition for review proceeding.
(2) Enforce any order entered in the matter, unless the
effect of the order has been superseded as prescribed in this
chapter.
(3) Grant reconsideration of the order which is the
subject of the appeal or petition, if:
(i) an application for reconsideration of the order is
filed in the trial court or other government unit within
the time provided or prescribed by law; and
(ii) an order expressly granting reconsideration of
such prior order is filed in the trial court or other
government unit within the time prescribed by these
rules for the filing of a notice of appeal or petition for
review of a quasijudicial order with respect to such order, or
within any shorter time provided or prescribed by law for
the granting of reconsideration.
Pa.R.A.P. 1701 (emphasis added).
Courts have interpreted the above -bolded language of Rule 1701(b)(1)
to include corrections that are technical, non -substantive amendments to an
order that have no effect on the appeal or petition for review and cannot
-9
J -A16001-19
prompt a new appealable issue. Pennsylvania Industrial Energy Coalition
v. Pennsylvania Public Utility Commission, 653 A.2d 1336, 1344 (Pa.
Cmwlth. 1995). See Fish v. Gosnell, 463 A.2d 1042, 1052 (Pa. Super. 1983)
(court's molding of verdict on thirty-sixth day after entry of judgment to reflect
pre -award interest under Pa.R.C.P. 238 was proper correction of formal error
under Rule 1701; court's action did not require exercise of discretion,
computation was clerical matter based on face of record, and no fact finding
required); see also Manack v. Sandlin, 812 A.2d 676 (Pa. Super. 2002)
(trial court had authority under Rule 1701 to change date of non -jury trial and
verdict on order to reflect correct date after thirty days elapsed from entry of
original order and where appeal had been filed). The Note to Rule 1701 further
explains that subsection (b)(1) is intended to "set[] forth an obvious power of
the lower court . . . under these rules to take actions to preserve the status
quo and to clarify or correct an order or verdict. The power to clarify or correct
does not extend to substantive modifications." Pa.R.A.P. 1701, Note to
Subdivision (b)(1) (citing examples of permissible actions under Rule
1701(b)(1) as "non -substantive technical amendments to an order, changes
in the form of a decree, and, modification of a verdict to add prejudgment
interest").
Here, Appellees failed to challenge the subject language in the court's
January 11, 2016 order in a timely motion to reconsider after filing their notice
of appeal. Moreover, the requested modification is more than a mere
- 10 -
J -A16001-19
correction or clarification, but rather amounts to a substantive alteration.
Thus, the trial court lacked jurisdiction to modify the order under Rule 1701.
In addition to Rule 1701, section 5505 of our Judicial Code also sets
forth rules regarding modification of orders. Section 5505 states:
Except as otherwise provided or prescribed by law, a court upon
notice to the parties may modify or rescind any order within 30
days after its entry, notwithstanding the prior termination of any
term of court, if no appeal from such order has been taken or
allowed.
42 Pa.C.S.A. § 5505. Despite the general prohibition to modify orders after
the appeal period has expired, courts have permitted modification under
section 5505 in the following circumstances: extrinsic fraud; lack of
jurisdiction over subject matter; fatal defect apparent on face of record; or
some other evidence of "extraordinary cause justifying intervention by the
court." ISN Bank v. Rajaratnam, 83 A.3d 170, 172 (Pa. Super. 2013).
Extraordinary cause has been defined as "an oversight or action on the part
of the court or the judicial process which operates to deny the losing party
knowledge of the entry of final judgment so that the commencement of the
running of the appeal time is not known to the losing party." Luckenbaugh
v. Shearer, 523 A.2d 399, 401 (Pa. Super. 1987).
There is nothing to support a finding of extrinsic fraud, lack of subject
matter jurisdiction, or a fatal defect apparent on the face of the record in the
instant case. Moreover, there is no extraordinary cause to justify the court's
intervention. Thus, like our prior Superior Court panel concluded, the trial
J -A16001-19
court was without jurisdiction to modify its January 11, 2016 order.
Accordingly, we find the November 28, 2018 order void and must vacate it.9
Order vacated. Jurisdiction relinquished.
Judgment Entered.
1--7
Jseph D. Seletyn,
Prothonotary
Date: 7/22/2019
9 The law of the case doctrine further supports our decision today. In
Commonwealth v. Starr, 664 A.2d 1326 (Pa. 1995), our Supreme Court
stated:
Departure from either the law of the case doctrine or the
coordinate jurisdiction rule is allowed only in exceptional
circumstances such as where there has been an intervening
change in the controlling law, a substantial change in the facts or
evidence giving rise to the dispute in the matter, or where the
prior holding was clearly erroneous and would create a manifest
injustice if followed.
Id. at 1332. Instantly, there was no intervening change in the law or any
change in the facts or evidence in the case since our Court's decision in
September 2017. Moreover, our Court's prior holding was not erroneous.
Id. Thus, we are precluded from altering the determination of a prior panel
of our appellate court.
- 12 -