Painter-Francis, L. v. Painter, T.

J-A33013-16
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
LEEANN PAINTER-FRANCIS, EXECUTRIX IN THE SUPERIOR COURT OF
OF THE ESTATE OF DOROTHY M. PENNSYLVANIA
PAINTER, DECEASED
v.
TERRY L. PAINTER, JOY E. PAINTER
HOWARD, RODGER C. PAINTER AND
PAULA V. PAINTER, HIS WIFE, DAVID L.
PAINTER AND CAROL A. PAINTER, HIS
WIFE, AND DANIEL H. PAINTER
APPEAL OF: TERRY L. PAINTER
No. 185 WDA 2016
Appeal from the Order Entered January 27, 2016
In the Court of Common Pleas of Westmoreland County
Civil Division at No(s): 5302 of 2008
*****
TERRY L. PAINTER IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellant
v.
JOY E. HOWARD, FORMERLY JOY E.
PAINTER, DAVID L. PAINTER AND CAROL
A. PAINTER, HIS WIFE
No. 901 WDA 2016
Appeal from the Order Entered June 2, 2016
In the Court of Common Pleas of Westmoreland County
Civil Division at No(s): 235 of 2016
J-A33013-16
BEFORE: LAZARUS, J., SOLANO, J., and STRASSBURGER, J.*
MEMORANDUM BY LAZARUS, J.: FILED FEBRUARY 27, 2017
In these consolidated appeals, Terry L. Painter (Painter) challenges the
trial court’s orders, entered in two separate actions, denying his exceptions
to the Special Master’s Final Report in Partition, which permitted Appellee,
Joy E. Painter Howard, to assign her 1/10th interest in the subject property
to Appellees, David and Carol Painter, and sustaining Appellees’ preliminary
objections and dismissing Painter’s breach of contract complaint based upon
res judicata and collateral estoppel.1 We affirm the order entered in the
partition action (185 WDA 2016)2 and reverse the order in the breach of
____________________________________________
*
Retired Senior Judge assigned to the Superior Court.
1
On September 7, 2016, this Court granted Painter’s motions for a
continuance and consolidation. As a result, No. 185 WDA 2016 (partition
action) and No. 901 WDA 2016 (breach of contract action) were
consolidated.
2
We note that Painter’s appeal in the partition action is properly before the
court as it resolved the primary conflict between the parties, that is the
division of the property, set forth the proposed schedule of distribution,
conclusively determined that the parcel was incapable of division into
purparts without prejudice to the whole, set forth the fair market value of
the property and provided for a private sale of the land to David and Carol
for a set total sum with specific terms for closing and costs to buyer and
seller. See Bernstein v. Sherman, 902 A.2d 1276 (Pa. Super. 2005)
(appeal from decision granting exceptions to partition master’s
recommendation and providing for private sale of property), but see
Zablocki v. Beining, __ A.3d __. 2017 WL 542021 at *2 (Pa. Super. Feb.
10, 2017) (appeal quashed where order appealed adopted findings of
master’s report in partition action and granted authority to have parcel enter
into multi-list agreement with broker, but left listing price indeterminate and
(Footnote Continued Next Page)
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contract action (901 WDA 2016) and remand for further proceedings in that
matter.
The fundamental issue in the underlying actions involves the March 3,
1982 transfer of a 42-acre parcel of farmland, located in North Huntingdon
Township, Westmoreland County. The parcel was owned by Painter’s now-
deceased parents, A. Logan Painter and Dorothy M. Painter (collectively, the
Painters). In 1982, the Painters conveyed 1/5 interests in the parcel to
themselves and to each of their four children and the children’s then-
spouses, Terry L. Painter (Appellant)/Joy Painter (Appellee/Howard3);
Rodger C. Painter/Paula Painter; David L. Painter/Carol A. Painter
(Appellees/collectively, David and Carol); and Daniel H. Painter/Wendy
Painter. In January 1987, Painter and Howard divorced.
On May 8, 2008, following the Painters’ deaths, Leeann Painter-
Francis, the executrix of Dorothy M. Painter’s estate,4 filed the underlying
partition action seeking to divide and/or sell the subject parcel and to
distribute it among interested persons. On June 20, 2008, Howard filed an
answer and new matter asserting that as a result of their divorce, she and
Painter now held their interest in the parcel as tenants-in-common rather
_______________________
(Footnote Continued)
specifically noted “final order in this case matter will be entered at the time
the return of sale and proposed schedule of distribution is filed by master.”).
3
Joy’s name following the divorce is Joy Painter Howard. She will be
referred to as “Howard” throughout this memorandum.
4
A. Logan predeceased his wife, Dorothy.
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than tenants by the entireties. See 23 Pa.C.S. 3507(a) (once divorce
granted, undivided interest in real property may be partitioned).5
On December 15, 2011, the trial court entered the following order, by
consent of all parties:
1. Directing partition of the property;
2. Declaring Terry L. Painter and Joy L. Painter (now, Howard) to
have an undivided one-fifth interest in same;
3. Declaring David L. Painter & Carol A. Painter to have an
undivided one-fifth interest in same; and
4. Appointing an attorney, Nancy L. Harris, Esquire, as Special
Master to make “such examination and hold such hearings as
may be necessary, giving reasonable notice thereof” and [to]
“file a report with the Court pursuant to Pa.R.C.P. 1569 and
1570.”
On June 1, 2012, Howard filed a motion seeking to have her undivided
one-fifth interest in the property, held in common with Painter, divided into
two separate one-tenth interests. The court granted Howard’s request and
directed the Special Master to distribute a one-tenth interest in the property
to Howard. On November 27, 2012, Howard executed an assignment of her
right, title and interest in the subject property “for good value and
consideration” to David and Carol.
____________________________________________
5
Painter did not file an answer to the partition complaint. As a result a
default judgment was entered against him. See Pa.R.C.P. 1037. This
normally precludes a party from challenging his or her liability. See Gall v.
Crawford, 982 A.2d 541 (Pa. Super. 2009).
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On January 22, 2013, the Special Master sent correspondence to
Painter, David and Carol’s attorney, and the remaining interested, non-
represented parties:
I am writing to inform you, first of all, that although I have not
yet heard from Terry Painter, none of the other parties w[as]
interested in being treated as an undivided interest with any
other party. Therefore, there will continue to be five undivided
one[-]fifth interests.
I also want to note that Mr. Matthews (Counsel for David
and Carol Painter) has informed me that Joy Painter
Howard has assigned her interest to David and Carol
Painter. In accordance with Judge Caruso’s original
partition Order, that interest is, of course, one half of the
one[-]fifth undivided interest shared with Terry Painter.
By order of court, the Special Master hired an engineering evaluation
of the property in order to make a determination as to whether subdivision
of the property was possible “without prejudice to or spoiling the whole.”
Pa.R.C.P. 1560. On August 15, 2013, the Special Master made a Preliminary
Determination that the parcel could not be subdivided into separate purparts
without destroying or spoiling the value of the property as a whole, and that
a partition shall occur through a private sale confined to the parties. No
objections were filed to the Preliminary Determination.
On August 18, 2014, the court held a hearing, before the Special
Master, that included testimony from two appraisers, in order to determine
the valuation of the property. On December 17, 2014, counsel for Painter
and Appellees Daniel Painter and Rodger Painter sent a letter to the Special
Master requesting a “final” hearing in which they could present additional
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testimony and evidence from independent sources concerning the value of
the property. On January 6, 2015, the Special Master notified all parties’
counsel that she was scheduling a hearing where Painter’s attorney could
present evidence of actual third party offers to purchase the subject
property made within the past twelve months, and also permitted any party
to present admissible evidence at the hearing with regard to factors affecting
probative value of bona fide offers.
On July 9, 2015, the Special Master issued an amended “Notice of
Proposed Determination in Partition.” The Special Master concluded that the
fair market value of the property was $673,920.00. The Special Master also
noted that unless objection was made, the subject property would be offered
at a private sale, confined to the parties, with a minimum bid set at the
property’s fair market value. Special Master’s Conclusions, 7/9/15, at ¶¶
40-41. Moreover, the Special Master gave notice to all parties, see
Pa.R.C.P. 1566(a), (b), and permitted them to object to the Proposed
Determination within 20 days of receiving the notice. Id. at ¶ 45. Only
David and Carol Painter filed objections to the Master’s Preliminary
Determination.
Painter filed a motion for reconsideration6 of the court’s order
acknowledging Howard’s legal claim to 1/10th of the land and any
____________________________________________
6
The parties acknowledge that a copy of Painter’s motion is not included in
the original record on appeal.
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corresponding share of the proceeds from the sale of the property in the
partition action. On August 7, 2015, after argument, the court denied
Painter’s motion, and on August 14, 2015, the Special Master moved to
confirm the value of the parcel “subject to partition for purposes of private
sale limited to the parties.” Motion, 8/14/15. In that motion, the Special
Master notes that a bona fide, written offer had been made by a local
developer for the parcel and that the offer includes a sale price of $16,000
per acre. The Special Master requested that the court confirm the fair
market value of the property, prior to conducting a private sale, at a total
value of $673,920.00 (roughly $16,000/sq. acre). The court confirmed this
valuation, by order, on August 13, 2015. On September 21, 2015, Painter
filed a motion to proceed with the sale of the parcel, alleging that he
appeal[s] only those interests of [Howard] in the above property
and the distribution of any proceeds from the sale [and]
requests . . . [that the court d[irect] that the One-Tenth (1/10)
interest in the proceeds of the such sale attributable to [Howard]
be held in escrow by the Special Master pending the disposition
of [his] appeal.
Motion to Proceed with Real Estate, 9/21/15, at 5-6.
On January 7, 2016, the Special Master issued a final report setting
forth, in part, that Howard had assigned her one-tenth interest in the land to
Carol and David Painter, now giving Carol and David a three-tenth interest in
the parcel. On January 15, 2016, Painter filed exceptions to this report
alleging that there was no evidence that Howard had made the assignment
of her interest in the parcel to Carol and David and that a post-nuptial
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agreement, that would have prevented the transfer, had never been taken
into consideration when the assignment was effectuated. Oral argument
was held on the matter and, on January 27, 2016, Painter’s exceptions were
denied. On February 4, 2016, Painter filed a timely appeal in the underlying
partition action.
On January 15, 2016, Painter filed the underlying breach of contract
action7 against Appellees Howard, David, and Carol, based upon an alleged
breach of the post-nuptial agreement he entered into with Howard. In this
action, Painter sought injunctive relief and money damages claiming that
Howard waived and agreed to convey her interest in the subject property 8 to
him in the post-nuptial agreement. Painter attached, as exhibits, copies of
motions and court orders filed in the partition action. Specifically, Painter
attached Howard’s motion seeking the court to confirm her 1/10th interest in
the subject property, the trial court’s order awarding her the 1/10 th interest,
and the purported agreement that Howard entered into with David and Carol
assigning her interest in the property to them.
____________________________________________
7
The action also alleges fraud, the request for the creation of a constructive
trust (equitable remedy), and unjust enrichment against Appellees.
8
Painter claims that the language in paragraph 7 of the parties’ post-nuptial
agreement conveys Howard’s interest in the parcel to him. It states, “The
Husband [Painter] holds the following property in his name alone: (b) A
one-fourth interest in A. Logan Painter and Sons, a partnership
which owns farmland, five lots, nine horses and a herd of cattle[.]” Post-
Nuptial Agreement, 12/21/84, at ¶ 7 (emphasis added).
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Appellees filed preliminary objections to Painter’s complaint. On June
2, 2016, the trial court dismissed Painter’s complaint, finding that Painter’s
issues raised and asserted “were litigated, decided, and are currently on
appeal in the Superior Court in the partition action . . . and that the petition
is barred by the pendency of the prior partition action, principles of res
judicata and collateral estoppel.” Opinion and Order of Court, 6/2/16, at 1.
On June 21, 2016, Painter filed a timely notice of appeal from the trial
court’s order.
Issues/Discussion (Partition Action)
On appeal, Painter presents the following issues for our review in the
underlying partition action (185 WDA 2016):
(1) Whether the trial court erred in determining that the
Appellant[,Terry L. Painter,] waived his rights to contest
the validity of the assignment of Joy E. Howard’s interest
in the property at issue to David and Carol Painter.
(2) Whether the Special Master abused her discretion or
committed an error of law in reallocating Joy E. Painter’s
1/10th interest in the property to David and Carol Painter,
and the Court below abused its discretion and committed
an error of law in affirming such reallocation, where:
A. The “Assignment” upon which such reallocation is based
is not of record, no hearing was conducted and
Appellant [Terry L. Painter] was not afforded the ability
to contest the validity of same; and
B. The Post-Nuptial Agreement entered between Appellant
[Terry L. Painter] and Joy E. Howard precluded the
assignment of her 1/10th interest in the real estate to
David Painter and Carol Painter, his wife.
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Painter alleges that the court abused its discretion when it dismissed
his exceptions and permitted Howard’s one-tenth interest to be assigned to
David and Carol because the assignment was not recorded, no hearing was
conducted on the issue, and he was not permitted to contest the validity of
the assignment. Additionally, he asserts that the court improperly found his
claims waived for failing to challenge the assignment of Howard’s interest
earlier in the partition action.
Instantly, Painter claims that a post-nuptial agreement he and Howard
entered into in 1984 precluded her from assigning her interest in the parcel
to David and Carol where that agreement made Painter the owner of the
property, assigned Howard’s interests in the property to Painter, and bound
Howard and her “assigns.” Appellant’s Brief, at 15. Therefore, according to
Painter, the post-nuptial agreement he relies upon fundamentally precludes
any transfer of title to the subject property (in this case, one-half of his 1/5th
interest, or 1/10th interest) to Howard.
The assignment of Howard’s 1/10th interest to David and Carol is only
secondary to Painter’s claim that Howard did not have any rights in the
property to begin with, pursuant to the post-nuptial agreement. If this is
true, Painter should have asserted his total ownership of the 1/5th interest
prior to or at the inception of the partition action in 2008. The parties’ post-
nuptial agreement was entered into in 1984, they were divorced in 1987,
and the partition action was brought eleven years later, in 2008. Instead,
Painter failed to file an answer to the partition complaint, which resulted in a
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default judgment being entered against him. Moreover, when Howard
moved to have the parties’ undivided 1/5th interest in the property divided
into two separate 1/10th interests and have them held in common, rather
than by the entireties, Painter never objected. Additionally, when the court
approved the distribution of a 1/10th interest in the parcel to Howard in
2012, Painter did not object. Finally, as Painter acknowledges, in January
2013, he received correspondence from the Special Master informing him
that Howard had assigned her 1/10th interest to David and Carol. See
supra at 4.
I am writing to inform you, first of all, that although I have not
yet heard from Terry Painter, none of the other parties were
interested in being treated as an undivided interest with any
other party. Therefore, there will continue to be five undivided
one[-]fifth interests.
I also want to note that Mr. Matthews (Counsel for David
and Carol Painter) has informed me that Joy Painter
Howard has assigned her interest to David and Carol
Painter. In accordance with Judge Caruso’s original
partition Order, that interest is, of course, one half of the
one[-]fifth undivided interest shared with Terry Painter.
Yet again, Painter did not object to this intended distribution and
assignment. In fact, it was not until Painter filed exceptions to the Special
Master’s proposed determination in July of 2015, that he raised the issue
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regarding the validity of Howard’s interest in the parcel as a result of the
parties’ post-nuptial agreement.9
Under the circumstances, we agree with the trial court that Painter
waited too long to contest Howard’s rights to the subject parcel. 10 Painter’s
unreasonable delay would not only have prejudiced Howard from assigning
her rights to Carol and David, but also would have stalled the distribution of
the proceeds from Howard’s 1/10th interest from the sale of the entire parcel
to a bona fide purchaser for fair market value. See Fulton v. Fulton, 106
A.3d 127 (Pa. Super. 2014) (equitable doctrine of laches bars relief when
complaining party is guilty of want of due diligence in failing to promptly
institute action to prejudice of another; to invoke doctrine must prove delay
arising from failure to exercise due diligence and prejudice to other parties
resulting from delay).
Issues/Discussion (Breach of Contract Action)
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9
Painter had, however, asked for a hearing to take evidence regarding the
valuation of the parcel.
10
The maxim of the doctrine of unclean hands necessarily gives wide range
to the equity court’s use of discretion in refusing to aid the unclean litigant.
Shapiro v. Shapiro, 204 A.2d 266 (Pa. 1964). Application of the unclean
hands doctrine is confined to willful misconduct which concerns the particular
matter in litigation. Id. Here, we are not inclined to find that Howard acted
with unclean hands in asserting her divided interest in the parcel in the
partition action; Painter’s own inaction supports the court’s decision to find
waiver of his claim that he is entitled to all of Howard’s interest in the parcel.
See Hartman v. Cohn, 38 A. 22, 25 (Pa. 1944) (court, in equity, is free to
refuse to apply doctrine of unclean hands if consideration of entire record
convinces court that inequitable result will be reached).
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Painter raises the following issues on appeal from his breach of
contract action (901 WDA 2016):
(1) Whether the trial court abused its discretion or committed
an error of law in dismissing [Painter’s] contract action
where:
(a) [Painter’s] claims in the contract action are not
identical to the claims raised in the partition action;
(b) [Painter’s] claims in the contract action could not be
raised in the partition action;
(c) The parties to the contract action are not identical to
the parties in the contract action;
(d) [Painter’s] contract claims would remain even if the
assignment of [Howard’s] 1/10th interest was found
to be valid; and
(e) The post-nuptial agreement between [Painter] and
[Howard], which forms the basis of the within breach
of contract action, was never considered in the
partition action.
On appeal, Painter asserts that the trial court improperly granted
Appellees’ preliminary objections and dismissed his complaint where neither
his claims nor the parties in his breach of contract action are identical to
those in the partition action. Moreover, he claims that the court erred by
not considering the post-nuptial agreement prior to dismissing his breach of
contract action.
Appellees, on the other hand, claim that Painter is simply attempting
to re-litigate the question of whether the post-nuptial agreement invalidated
the transfer of a 1/10th interest in the subject property from Howard to
David and Carol. Moreover, they assert that Painter failed to timely raise
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the issue regarding the post-nuptial agreement and its effect on the transfer
of the property in the underlying partition action. Thus, he cannot resurrect
the argument, in the guise of a breach of contract action, at this late stage.
An appellate court’s standard of review of an order of the trial
court . . . granting preliminary objections is to determine
whether the trial court committed an error of law. When
considering the appropriateness of a ruling on preliminary
objections, the appellate court must apply the same standard as
the trial court. Preliminary objections in the nature of a
demurrer test the legal sufficiency of the complaint. When
considering preliminary objections, all material facts set forth in
the challenged pleadings are admitted as true, as well as all
inferences reasonably deducible therefrom. Preliminary
objections which seek the dismissal of a cause of action should
be sustained only in cases in which it is clear and free from
doubt that the pleader will be unable to prove facts legally
sufficient to establish the right to relief. If any doubt exists as to
whether a demurrer should be sustained, it should be resolved in
favor of overruling the preliminary objections.
Feingold v. Hendzrak, 15 A.3d 937, 942 (Pa. Super. 2010) (citation
omitted).
In the breach of contract action, the trial court noted:
The issues raised in the [contract action] are a continuation of
[Painter’s] relentless efforts to challenge a determination well
after the fact, after a significant passage of time and after
remaining silently passive and unresponsive while the prior
litigation ran its course.
Trial Court Opinion, 6/2/16, at 6. Specifically, the court asserted that the
court in the partition action had already made a determination regarding the
effect that the parties’ post-nuptial agreement had on Howard’s 1/10th
interest in the subject parcel. We disagree.
It is well established that:
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Where there has previously been rendered a final judgment on
the merits by a court of competent jurisdiction, the doctrine of
res judicata will bar any future suit on the same cause of action
between the same parties. Invocation of the doctrine of res
judicata (claim preclusion) requires that both the former and
latter suits possess the following common elements:
1. identity in the thing sued upon;
2. identity in the cause of action;
3. identity of persons and parties to the action; and
4. identity of the capacity of the parties suing or being
sued.
Matternas v. Stehman, 642 A.2d 1120, 1123 (Pa. Super. 1993) (emphasis
added). Collateral estoppel, on the other hand, does not require identity of
causes of action or parties. Thompson v. Karastan Rug Mills, 323 A.2d
341 (Pa. Super. 1974). However, while res judicata will bar subsequent
claims that could have been litigated in the prior action, but which actually
were not, collateral estoppel will bar only those issues that actually were
litigated in the prior proceeding. Martin v. Poole, 336 A.2d 363 (Pa.
Super. 1975).
The record in the partition action shows that the court denied Painter’s
exceptions to the Special Master’s final determination based on the doctrine
of waiver, not on whether the post-nuptial agreement prevented Howard
from obtaining a 1/10th interest in the property and assigning that interest to
Carol and David. Specifically, the court concluded that Painter’s failure to
object to the proposed distribution for almost seven years after the filing of
the partition complaint rendered any objection to the distribution waived.
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Therefore, we find that a “final judgment on the merits” was never rendered
regarding the effect of the post-nuptial agreement in the partition action for
purposes of applying collateral estoppel or res judicata in Painter’s breach of
contract action.
We recognize that the trial court stated that “the Court hear[d]
argument from counsel for Terry L. Painter, counsel for Plaintiffs and Special
Master Harris” in reference to Painter’s Exceptions in the partition action.
Trial Court Opinion, 3/1/16, at 4. There is no transcript, however, of these
proceedings in the certified record on appeal to determine whether the post-
nuptial agreement was considered by the court at that time.11 Moreover,
there is nothing else in the record to demonstrate that the court ruled upon
the merits of the issue regarding the parties’ post-nuptial agreement or
whether a valid assignment of Howard’s interest in the parcel, via an alleged
quitclaim deed to Carol and David, was ever recorded.
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11
We note, as well, that the court acknowledges that a copy of Painter’s
motion for reconsideration filed in the partition action is not in the certified
record. See Trial Court Opinion, 6/2/16, at 5 n.2. This Court is mindful of
the fact that the fundamental tool for appellate review is the official record of
the events that occurred in the trial court. Commonwealth v. Williams,
715 A.2d 1101, 1103 (Pa. 1998). To ensure that an appellate court has the
necessary records, the Pennsylvania Rules of Appellate Procedure provide for
the transmission of a certified record from the trial court to the appellate
court. Id. The law of Pennsylvania is well settled that matters which are
not of record cannot be considered on appeal. Commonwealth v.
Bracalielly, 658 A.2d 755, 763 (Pa. 1995).
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While the doctrine of res judicata also applies to claims that could have
been raised in a prior litigation, Wilkes ex rel. Mason v. Phoenix Home
Life Mut. Ins. Co., 902 A.2d 266 (Pa. 2006), Painter technically did raise
the issue of the post-nuptial agreement, albeit late in the proceedings, when
he filed his exceptions to the Special Master’s final report. Therefore, we
must reverse the order granting Appellees’ preliminary objections and
dismissing Painter’s breach of contract claim on the basis of res judicata and
collateral estoppel where the court made no final determination on the
merits of the issue. Feingold, supra.
Conclusion
While Painter was unsuccessful in quieting title to his alleged 1/10th
interest in the subject property that Howard claimed in the underlying
partition action, he may still proceed with his breach of contract action based
on an alleged post-nuptial agreement. See 23 Pa.C.S. § 3502(e) (affords
courts broad powers to enforce compliance with terms of agreement as
entered into between the parties in divorce action).
Order denying Painter’s exceptions affirmed in 185 WDA 2016 (5302 of
2008) and order sustaining Appellees’ preliminary objections and dismissing
Painter’s breach of contract complaint reversed. Case remanded for further
proceedings in 901 WDA 2016 (235 of 2016). Jurisdiction relinquished.
Judge Solano joins this Memorandum; Judge Strassburger files a
Concurring and Dissenting Memorandum.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 2/27/2017
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