Zadok Grahm Hunly Corp v. Presbyterian Seniorcare

J-A29003-22, J-A29004-22, J-A29005-22 & J-A29007-22
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
ZADOK GRAHM HUNLY CORP. : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
:
v. :
:
:
PRESBYTERIAN SENIORCARE AND : No. 671 WDA 2021
LONGWOOD AT OAKMONT, INC. :
Appeal from the Judgment Entered May 11, 2021
In the Court of Common Pleas of Allegheny County Civil Division at
No(s): GD 17-001195
PRESBYTERIAN SENIORCARE AND : IN THE SUPERIOR COURT OF
LONGWOOD AT OAKMONT, INC. : PENNSYLVANIA
:
:
v. :
:
:
RICHARD G. AUFMAN, I/T/D/B/A :
Z.G. HUNLEY CORP., ZADOK GRAHM : No. 672 WDA 2021
HUNLEY CORP., I/T/D/B/A Z.G. :
HUNLEY CORP., JOHN R. MCCOLLUM, :
SODEXO OPERATIONS, LLC AND :
JOSEPH SEPCIC, I/T/D/B/A Z.G. :
HUNLEY CORP. :
:
:
APPEAL OF: ZADOK GRAHM HUNLY :
CORP. :
Appeal from the Judgment Entered May 11, 2021
In the Court of Common Pleas of Allegheny County Civil Division at
No(s): GD-15-015968
PRESBYTERIAN SENIORCARE AND : IN THE SUPERIOR COURT OF
LONGWOOD AT OAKMONT, INC. : PENNSYLVANIA
:
J-A29003-22, J-A29004-22, J-A29005-22 & J-A29007-22
:
v. :
:
:
RICHARD G. AUFMAN, I/T/D/B/A :
Z.G. HUNLEY CORP., ZADOK GRAHM : No. 673 WDA 2021
HUNLEY CORP., I/T/D/B/A Z.G. :
HUNLEY CORP., JOHN R. MCCOLLUM, :
SODEXO OPERATIONS, LLC AND :
JOSEPH SEPCIC, I/T/D/B/A Z.G. :
HUNLEY CORP. :
:
:
APPEAL OF: RICHARD G. AUFMAN :
Appeal from the Judgment Entered May 11, 2021
In the Court of Common Pleas of Allegheny County Civil Division at
No(s): GD 15-015968
PRESBYTERIAN SENIORCARE AND : IN THE SUPERIOR COURT OF
LONGWOOD AT OAKMONT, INC. : PENNSYLVANIA
:
:
v. :
:
:
RICHARD G. AUFMAN, I/T/D/B/A :
Z.G. HUNLEY CORP., ZADOK GRAHM : No. 675 WDA 2021
HUNLEY CORP., I/T/D/B/A Z.G. :
HUNLEY CORP., JOHN R. MCCOLLUM, :
SODEXO OPERATIONS, LLC AND :
JOSEPH SEPCIC, I/T/D/B/A Z.G. :
HUNLEY CORP. :
:
:
APPEAL OF: JOSEPH SEPCIC :
Appeal from the Judgment Entered May 11, 2021
In the Court of Common Pleas of Allegheny County Civil Division at
No(s): GD 15-015968
BEFORE: BENDER, P.J.E., OLSON, J., and KUNSELMAN, J.
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MEMORANDUM BY BENDER, P.J.E.: FILED: FEBRUARY 27, 2023
Zadok Grahm Hunly Corp. (“Hunly”) appeals at docket number 672 WDA
2021 from a May 11, 2021 judgment entered against it at GD 15-015968
following a non-jury trial, in which the trial court found, inter alia, Hunly liable
for fraud and conspiracy. Richard G. Aufman and Joseph Sepcic also each
appeal — at docket numbers 673 WDA 2021 and 675 WDA 2021, respectively
— from the same May 11, 2021 judgment entered at GD 15-015968, which
also found them liable for fraud and conspiracy. In addition, Hunly appeals at
docket number 671 WDA 2021 from a separate May 11, 2021 judgment
entered at GD 17-001195, in which the trial court denied its claims for breach
of contract, unjust enrichment, and payment under the Contractor and
Subcontractor Payment Act (“CASPA”), 73 P.S. §§ 501-516.1 After careful
review, we affirm the judgments entered at both GD 15-015968 and GD 17-
001195.
Background
The trial court summarized the background of this matter as follows:
I. The Parties
Presbyterian SeniorCare (“PSC”) is a Pennsylvania not-for-profit
corporation that provides continuum senior living and care
services in fifty-three (53) separate housing communities.
____________________________________________
1 We have consolidated these cases sua sponte pursuant to Pa.R.A.P. 513.
See Pa.R.A.P. 513 (“Where there is more than one appeal from the same
order, or where the same question is involved in two or more appeals in
different cases, the appellate court may, in its discretion, order them to be
argued together in all particulars as if but a single appeal.”).
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Longwood at Oakmont, Inc. (“Longwood”) is one of PSC’s
retirement communities.
Sodexo Operations, LLC (“Sodexo”) is a multi-national,
interdisciplinary service provider. Sodexo offers food and senior
living services including facilities management. Sodexo also has
a construction division. PSC and Longwood engaged Sodexo to
provide facilities management services at each of their respective
campuses.
John McCollum (“McCollum”) is an individual who spent most of
his career running his own construction company, W.F. Cody. He
was an employee of Sodexo during all times material to this
litigation. Sodexo assigned McCollum to perform its obligations at
both PSC and Longwood.
Richard Aufman (“Aufman”) is a self-employed CPA. He is also a
shareholder in several corporations, and a friend and business
associate of McCollum.
Joseph Sepcic (“Sepcic”) is an architect. He is also a friend and
business associate of McCollum.
[Hunly] is a company, which Aufman incorporated on March 15,
2014, at the instruction of McCollum. Aufman owns twenty (20)
percent of Hunly’s shares. Sepcic owns the remaining shares.
Aufman operated Hunly out of his home[-]office accounting
practice.
Riverview Carpet & Flooring, Inc., Masco Interiors, Inc., Roland
Pastucha Electric, Inc., and Tigano Painting and Wallcovering
(collectively referred to hereinafter as the “Subcontractors”) are
all Pennsylvania Subcontractors. McCollum engaged the
Subcontractors on behalf of Hunly to perform construction and
finishing work on Longwood’s campus.
II. Factual and Procedural Background
On December 21, 2011, Sodexo and Longwood entered into a
Facilities Management Agreement (“Longwood Management
Agreement”) with a term beginning January 16, 2012[,] and
ending January 16, 2015. The Longwood Management Agreement
required Sodexo to provide Longwood with a qualified General
Manager to function as the head of Longwood’s maintenance
department. Thereafter, on May 24, 2012, Sodexo and PSC
entered into a Facilities Management Agreement (“PSC
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Management Agreement”) with a term beginning July 10, 2012[,]
and ending July 10, 2015. From 2012 to 2014, Sodexo provided
Longwood with a succession of on-site managers who did not
adequately fulfill their roles and were repeatedly replaced by
Sodexo. Meanwhile, McCollum and Sepcic discussed forming a
construction company together. During these discussions[,]
McCollum recommended that Sepcic contact Aufman.
In January of 2014, while the General Manager position at
Longwood was vacant, Sodexo assigned McCollum to assist
Longwood with a water pipe emergency. McCollum approached
Aufman and Sepcic[,] and asked them whether they were
interested in performing some work for PSC. Although, at this
time, Hunly had not yet been incorporated, McCollum
recommended Hunly to Longwood as a potential general
contractor. McCollum told Longwood that he was personally
familiar with Hunly, and that Hunly came highly recommended by
others. Hunly then submitted bids, which Longwood accepted as
a result of McCollum’s recommendations. Once the water pipes
were fixed, Longwood asked Sodexo to retain McCollum at the
Longwood campus. Sodexo agreed, hoping that McCollum would
become indispensable to Longwood, and remedy Sodexo’s
deficient performance in relation to the Longwood Management
Agreement.
In March of 2014, Paul Peterson (“Peterson”), Longwood’s new
executive director, recognizing an urgent need for renovations,
opted to establish a benchmark pricing structure for new unit
turnovers instead of obtaining multiple bids for each unit.
Peterson tasked McCollum with obtaining estimates based on work
done in the past. McCollum represented that Hunly[’s] estimates
were lower than Bill Bonura Cabinets’ estimates.1 Peterson
accepted McCollum’s representations of the estimates, and the
benchmarks were set accordingly.
1 Bill Bonura Cabinets is a contractor Longwood engaged in
the past.
McCollum had a significant role in Longwood’s renovations.
McCollum was responsible for gathering information on both the
scope of work and the pricing for each unit renovation.
Additionally, McCollum was tasked with overseeing the
construction work. After a project was complete, McCollum
obtained the general contractor’s invoices and was responsible for
submitting these invoices to Longwood’s Accounts Payable
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Department. Even though Hunly submitted bids as a general
contractor, Hunly did no actual work itself. Instead, McCollum
engaged subcontractors and monitored the subcontractors[’]
work. Hunly had no employees or expenses.
In May of 2014, Aufman and his wife incorporated a company
called Iron Bull Interiors, LLC. During this time, McCollum’s
performance at Longwood appeared to be satisfactory. McCollum
quickly established himself as an integral part of the unit turnover
process. Accordingly, Peterson deferred to McCollum, as Peterson
trusted McCollum’s construction experience, and McCollum’s
control of the invoice and capital approval process increased.
After September of 2014, McCollum’s submission of invoices
became increasingly sporadic. McCollum began withholding
invoices for long periods of time, which made it difficult for
Longwood to track costs on an ongoing basis. McCollum’s
practices also impacted Longwood’s cashflow. Eventually, for the
first time in 20 years, Longwood had to seek additional capital
from its Board of Directors. This made it extremely difficult for
Longwood to verify whether the invoices fell below or above
Longwood’s benchmarks. At the same time, Hunly hired
McCollum’s son Grahm, as an intern. Hunly listed Grahm as the
Vice President on the company’s signature card at First National
Bank. Hunly also gave Grahm check writing authority on behalf
of Hunly.
In October of 2014, several of [Longwood’s] executives received
an anonymous letter, which accused McCollum of having an
improper interest in Hunly. This letter raised questions regarding
Longwood’s process for retaining contractors. Longwood
confronted and interviewed McCollum in person about the
allegations, which McCollum denied. Longwood also directed
McCollum to respond to the allegations in writing, which McCollum
did. Longwood thereafter asked McCollum to fill out and sign
Longwood’s conflict[-]of[-]interest statement. McCollum
completed and signed Longwood’s conflict[-]of[-]interest
statement and represented that he had no conflicts of interest.
Longwood also asked Aufman if McCollum had any interest in
Hunly. Aufman denied that McCollum had any interest
whatsoever. After Longwood concluded its investigation,
Longwood provided Sodexo with all of the aforementioned
information so that Sodexo could conduct its own review and
investigation of the matter. Based upon Longwood’s
investigation, and McCollum’s and Aufman’s assurances,
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Longwood’s suspicions were mitigated, and Longwood took no
further action.
In December of 2014, Longwood discovered a large number of
delinquent Hunly invoices and thereafter informed Sodexo of
McCollum’s problematic invoice practices. A few Sodexo
executives expressed their distrust of McCollum via internal
correspondences. However, Sodexo’s executives never shared
their opinion of McCollum with Longwood. Meanwhile, Aufman
formed Fairbanks Holding Co., Inc., for McCollum, and Grahm took
ownership of Iron Bull, LLC, which was originally formed by
Aufman and Aufman’s wife. On December 9, 2014, Grahm opened
a bank account for Iron Bull, LLC. On the same day, McCollum
opened a bank account for Fairbanks Holding Co., Inc.[] The
authorized signatories for Fairbanks Holding Co., Inc., include
McCollum (as president), McCollum’s wife, Regina (as secretary),
and Grahm (as vice president).
In January of 2015, the Longwood Management Agreement was
set to automatically renew. However, Longwood sent written
notice to Sodexo that Longwood was opting out of the automatic
renewal and terminating the Longwood Management Agreement.
Nevertheless, because the PSC Management Agreement was not
set to expire until July of 2015, Longwood decided that it preferred
to end all relationships with Sodexo at the same time as PSC.
Although Sodexo offered Longwood an agreement with an
expanded scope, Longwood declined. Longwood instead
purs[u]ed a limited extension of the Longwood Management
Agreement and began negotiations with Sodexo for the same. On
January 16, 2015, Longwood and Sodexo entered into a consulting
agreement (“Longwood Consulting Agreement”). The Longwood
Consulting Agreement provided that Sodexo would continue
providing services at the Longwood campus until the end of June[]
2015. McCollum continued to manage and oversee Longwood’s
renovations, and Sodexo continued to provide oversight and
supervision over McCollum’s work at Longwood.
By March of 2015, McCollum began shredding excessively large
quantities of paper. McCollum discarded the shredded paper in
various trash cans around Longwood’s campus. In total,
McCollum’s shredded paper filled about five full trash cans per
day. Meanwhile, Grahm systematically wrote checks on behalf of
Hunly to Iron Bull, LLC[,] totaling $975,000.00. Grahm then
wrote checks from Iron Bull, LLC to Fairbank[s] Holding Co., Inc.,
totaling $868,000.00. Of the funds transferred via check from
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Iron Bull, LLC to Fairbanks Holding Co., Inc., $111,989.50 went
to Grahm personally. Grahm also wrote a check totaling
$33,000.00 directly to himself. Iron Bull, LLC transferred another
$10,000.00 to W.F. Cody.
On April 16, 2015, McCollum had a verbal altercation with a
Longwood employee. Thereafter, on May 1, 2015, Longwood
hired John Bulger (“Bulger”) as a Facilities Director. Although
McCollum was originally supposed to help Bulger transition into
his new role, due to McCollum’s verbal altercation with a
Longwood employee, Longwood asked Sodexo to remove
McCollum from Longwood’s campus. On his own, Bulger
attempted to understand where Longwood’s renovations projects
stood in terms of cost and completion status. However, Bulger’s
mission was frustrated because Bulger could not find adequate
records. Additionally, there remained a large number of Hunly
invoices, which Hunly claimed were overdue.
On May 22, 2015, Bulger convened a meeting with Aufman and
several disgruntled Subcontractors whom Hunly had not paid. The
end result of the meeting was that Aufman agreed to provide
Bulger with additional information so that Bulger could verify
Hunly’s invoices. However, Aufman later refused to provide the
additional documentation and continued to demand payment.
While searching for Hunly’s invoices, Longwood discovered
numerous invoices that McCollum had not submitted during his
tenure at Longwood. Some of these invoices were 18[-]months
old.
While the Subcontractors complained that they were not being
paid, Hunly refused to pay them until Longwood paid Hunly.
Longwood needed to avoid delays in the renovation process so
that Longwood’s apartments were ready in time for new
occupants. Accordingly, while Bulger’s investigation of the Hunly
invoices remained ongoing, Longwood began issuing large checks
to Hunly in reliance upon Hunly’s promise to pay the
Subcontractors within seven (7) to ten (10) days. Nevertheless,
despite receiving $613,069.50 from Longwood after McCollum
left, Hunly did not pay the Subcontractors and continued to
demand more money from Longwood. In order to keep the
renovation projects moving along, Bulger assured the
Subcontractors that Longwood would “make good on Hunly’s
debt.” Based upon Bulger’s assurance, the Subcontractors
continued working.
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Bulger began to suspect that Hunly severely overcharged
Longwood, as Bulger discovered that he could perform the role of
the general contractor himself without need for an outside general
contractor like Hunly. While Hunly threatened Longwood with
litigation, Longwood retained counsel and withheld any more
payments to Hunly for Hunly’s allegedly outstanding invoices.
Eventually, on September 14, 2015, PSC and Longwood initiated
the instant action. Through discovery, PSC and Longwood
discovered the extent of McCollum and Hunly’s relationship, in
addition to the extent of McCollum’s and Hunly’s overcharges and
fraud.
PSC and Longwood’s original complaint was docketed at GD 15-
015968. On March 20, 2017, PSC and Longwood[] filed their First
Amended Complaint. PSC and Longwood’s First Amended
Complaint is their final operative complaint. PSC and Longwood’s
final operative complaint alleged five counts. Counts I is for
Breach of Contract, and it alleges that Sodexo breached both the
Longwood Management Agreement and the PSC Management
Agreement. Count II is for Breach of Contract with a Demand for
Indemnification. Count II alleges that Sodexo breached the
indemnification clauses of both the Longwood Management
Agreement and the PSC Management Agreement. Count III is for
Unjust Enrichment, and it alleges that Hunly received inequitably
high sums of money in relation to the actual work that Hunly
performed. Count IV is for Fraud, and it alleges that Hunly,
Aufman, Sepcic, and McCollum were overpaid for their services as
a result of fraudulent misrepresentations. Finally, Count V is for
Conspiracy, and it alleges that Hunly, Aufman, Specic [sic],
McCollum, and Sodexo conspired to defraud both PSC and
Longwood.
On June 28, 2017, following PSC and Longwood’s First Amended
Complaint, Sodexo filed its final operative counterclaims to its
Answer, New Matter, and Counterclaims to First Amended
Complaint. In total, Sodexo asserted four counterclaims.
Counterclaim I is for Breach of Contract, and it alleges that
Longwood breached the Longwood Management Agreement by
failing to pay software licensing fees. Counterclaim II is for Unjust
Enrichment, and it alleges that Longwood was unjustly enriched
because Longwood was able to use Sodexo’s software without
paying the requisite fees. Counterclaim III is for Breach of
Contract, and it alleges th[at] PSC breach[ed] the PSC
Management Agreement for failing to pay software licensing fees.
Finally, Counterclaim IV is for Unjust Enrichment, and it alleges
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that PSC was unjustly enriched because PSC was able to use
Sodexo’s software without paying the requisite fees.
On January 23, 2017, Hunly filed a complaint against PSC and
Longwood at GD 17-00195. On March 16, 2017, this [c]ourt
consolidated Hunly’s claims at GD 17-001195 with the action at
GD 15-015968. On October 3, 2017, Hunly filed its Second
Amended Complaint, which [is] its final operative complaint.
Hunly’s final operative complaint alleged three [c]ounts. Count I
is for Breach of Contract, and it alleges that … PSC and Longwood
breached various written and oral contracts with Hunly because
PSC and Longwood failed to pay Hunly for outstanding invoices for
Hunly’s services as a general contractor. Count II is for Unjust
Enrichment, and it alleges that PSC and Longwood were unjustly
enriched because they received the benefit of the Subcontractors’
work without paying Hunly’s outstanding invoices. Count III
alleges that PSC and Longwood are liable to Hunly pursuant to
[CASPA] for failing to pay Hunly’s outstanding invoices.
On September 7, 2018, the Subcontractors filed a Complaint
against all the above-mentioned parties at GD 18-012048. Each
of the four Subcontractors alleged a separate count for Breach of
Contract against all parties for failing to pay the invoices of the
Subcontractors. Additionally, each of the four Subcontractors
alleged a separate count for Conspiracy to Commit Fraud against
Sodexo, McCollum, Aufman, and Hunly. On November 28, 2018,
this Court consolidated the Subcontractors’ claims at GD 18-
012048 with the actions at GD 17-001195 and GD 15-015968. On
February 7, 2019, the Subcontractors filed their Amended
Complaint, which is the Subcontractors’ final operative complaint.
The Subcontractors’ final operative complaint remains unchanged
with regards to the counts for breach of contract. However, the
Subcontractors’ final operative complaint substituted the four
counts for Conspiracy to Commit Fraud with four counts of Unjust
Enrichment against PSC and Longwood. All of the counts for
Unjust Enrichment allege that both PSC and Longwood were
unjustly enrich[ed] because PSC and Longwood failed to provide
compensation to the Subcontractors in relation to completed
construction work.
On February 21, 2019, PSC and Longwood filed a crossclaim[,]
attempting to shift liability for the Subcontractors’ claims to
Sodexo, McCollum, Hunly, Aufman, and Sepcic. Then, on
February 27, 2019, Hunly filed its own crossclaim[,] attempting to
shift liability for the Subcontractors’ claims to PSC and Longwood.
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In [March] of 2019, this [c]ourt held a non-jury trial[,] in which
all the parties had a full and adequate opportunity to present their
respective cases. On April 9, 2020, this [c]ourt issued a
Memorandum and Non-Jury Verdict. Shortly thereafter, on April
14, 2020, this [c]ourt issued an Amended Memorandum and Non-
Jury Verdict (dated April 9, 2020), which detailed the verdicts
described below.
With regard to PSC and Longwood’s affirmative claims in their First
Amended Complaint at GD 15-015968, this Court held: (1) in
favor of PSC and Longwood and against Sodexo on Count [I]
(Breach of Contract); (2) in favor of Sodexo and against PSC and
Longwood on Count II (Demand for Indemnification); (3) in favor
of Hunly, Aufman, and Sepcic and against PSC and Longwood on
Count III (Unjust Enrichment); and (4) in favor of PSC and
Longwood and against Hunly, Aufman, Sepcic, Sodexo, and
McCollum on Count IV (Fraud) and Count V (Conspiracy). [For
these claims, the trial court determined that Longwood is entitled
to $933,220.71 from all defendants, jointly and severally.]
With regard to Sodexo’s counterclaims against PSC and Longwood
at GD 15-015968, this [c]ourt held: (1) in favor of Sodexo and
against Longwood on Sodexo’s Counterclaim I (Breach of
Contract) in the amount of $4,409.65; (2) in favor of Longwood
and against Sodexo on Sodexo’s Counterclaim II (Unjust
Enrichment); (3) in favor of Sodexo and against PSC on Sodexo’s
Counterclaim III (Breach of Contract) in the amount of
$31,666.47; and (4) in favor of PSC and against Sodexo on
Sodexo's Counterclaim IV (Unjust Enrichment).
With regard to Hunly’s affirmative claims against PSC and
Longwood at GD 17-001195, this [c]ourt held: (1) in favor of PSC
and Longwood and against Hunly on Count I (Breach of Contract
for Unpaid Invoices)[;] (2) in favor of PSC and Longwood and
against Hunly on Count II (Unjust Enrichment for Unpaid
Invoices); and (3) in favor of PSC and Longwood and against
Hunly on Count III (Violation of the Pennsylvania Contractor and
Subcontractor Payment Act).
With regard to the Subcontractors’ claims against PSC and
Longwood at GD 18-012048, this [c]ourt held: (1) in favor of
Riverview Carpet & Flooring, Inc., and against Longwood on Count
I (Breach of Contract) in the amount of $82,571.97; (2) in favor
of Masco Interiors, Inc., and against Longwood on Count II
(Breach of Contract) in the amount of $218,135.00; (3) in favor
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of Roland Pastucha Electric, Inc., and against Longwood on Count
III (Breach of Contract) in the amount of $32,245.00; [(4)] in
favor of Tigano Painting and Wallcovering and against Longwood
on Count IV (Breach of Contract) in the amount of $86,597.00;
[(5)] in favor of Longwood and against the Subcontractors on
Counts V-VIII (Unjust Enrichment); [(6)] in favor of Longwood
and against Hunly, Aufman, Sepcic, McCollum, and Sodexo on
Longwood’s Crossclaim;2 and [(7)] in favor of Longwood and
against Hunly on Hunly’s Crossclaim.
2 This [c]ourt ordered Hunly, Aufman, [and] Sepcic[] to
contribute to the sums that Subcontractors shall collect from
Longwood by virtue of this verdict.
Following this [c]ourt’s April 14, 2020[] Amended Memorandum
and Non-Jury Verdict, the parties filed Motions for Post-Trial
Relief. On September 29, 2020, after hearing oral argument, and
after due considerations of the parties’ briefs, this [c]ourt issued
an order addressing the parties’ Motions for Post-Trial Relief. This
[c]ourt’s September 29, 2020 order denied Sodexo’s, Hunly’s,
McCollum’s, Aufman’s, and Sepcic’s Motions for Post-Trial Relief.
This [c]ourt’s September 29, 2020 order also denied PSC’s and
Longwood’s Motion for Post-Trial Relief, at least to the extent that
PSC and Longwood requested an additional award for punitive
damages, and a stay of execution pursuant to Pa.R.C[iv].P. 3121.
This [c]ourt’s September 29, 2020 order, nonetheless, granted
PSC and Longwood’s Motion for Post-Trial Relief to the extent that
PSC requested that the April 14, 2020 Amended Non-Jury Verdict
be amended further to reflect this [c]ourt’s decision as explained
in this [c]ourt’s April 14, 2020 Amended Memorandum.
Accordingly, Sections 4(a)-(d) of this [c]ourt’s Amended Non-Jury
Verdict[,] dated April 14, 2020[,] were amended to include Hunly,
Aufman, Sepcic, and McCollum as parties against whom each
Subcontractor was awarded damages [for breach of contract].[2]
Section 4(f) of this [c]ourt’s Amended Non-Jury Verdict[,] dated
April 14, 2020[,] was also amended to read: “In favor of
Longwood and against Hunly, Aufman, Sepcic, McCollum, and
Sodexo on Longwood’s Crossclaim. Hunly, Aufman, Sepcic,
McCollum, and Sodexo shall, jointly and severally, indemnify
____________________________________________
2 Sodexo was not included, as the Subcontractors had withdrawn their breach-
of-contract claim against Sodexo by the time of trial. See N.T. Trial, 3/13/19,
at 1747 (Subcontractors’ stipulating that they have no breach-of-contract
claim against Sodexo, as they “had no contract with Sodexo”).
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Longwood for all amounts [Longwood] pays or are otherwise
collected from [Longwood] by the Subcontractors pursuant to this
Verdict.”
On May 7, 2020, the Subcontractors also filed a Motion to Mold
the Verdict to include pre-judgment and post-judgment interest.
The Subcontractors’ Motion to Mold the Verdict was heard at the
same time as the other parties’ Motions for Post-Trial Relief. In a
separate order dated September 29, 2020, but filed on October 1,
2020 (the “October 1, 2020 order”), this [c]ourt granted the
Subcontractor’s Motion to Mold the Verdict. Accordingly, this
[c]ourt’s October 1, 2020 order molded the above[-]mentioned
verdicts awarded in favor of the Subcontractors to include pre-
judgment and post-judgment interest. Specifically, the final
amounts of the verdicts awarded in favor of the Subcontractors
were molded as follows: (1) in favor of Riverview Carpet &
Flooring, Inc., and against Longwood, Hunly, Aufman, Sepcic, and
McCollum on Count I (Breach of Contract) in the amount of
$156,756.00; (2) in favor of Masco Interiors, Inc., and against
Longwood, Hunly, Aufman, Specic [sic], and McCollum on Count
II (Breach of Contract) in the amount of $287,477.04; and (3) in
favor of Tigano Painting and Wallcovering and against Longwood,
Hunly, Aufman, Sepcic, and McCollum on Count IV (Breach of
Contract) in the amount of $114,531.95.
On February 2, 2021, after reviewing Longwood’s and PSC’s
Petition for Award of Attorney’s Fees and Litigation Expenses
Including Pre-Hearing Statement, and after a hearing on the
same, this [c]ourt issued an order granting Longwood and PSC
attorney’s fees and expenses totaling $1,062,053.67.
Trial Court Opinion at GD 15-015968 (“TCO”), 4/18/22, at 1-13 (some original
brackets changed to parentheses; some brackets added).
On May 11, 2021, the trial court entered separate judgments on each
trial court docket (i.e., GD 15-015968, GD 17-001195, GD 18-012048).3 Each
____________________________________________
3 Some of the parties involved in this matter had prematurely filed appeals
without judgment being entered. This Court quashed those appeals, directing
the parties to appeal after the trial court entered separate judgments at each
trial court docket. See Trial Court Judgment at GD 15-015968, 5/11/21, at
Exhibit A; Trial Court Judgment at GD 17-001195, 5/11/21, at Exhibit A.
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separate judgment contained only the trial court docket number at which the
judgment was filed and related only to the claims associated with that
particular docket number.
On June 10, 2021, Hunly, Aufman, and Sepcic each filed a timely notice
of appeal from the judgment entered at trial court docket GD 15-015968.4, 5
On the same day, Hunly also filed a timely notice of appeal from the judgment
entered at trial court docket GD 17-001195.6 The trial court subsequently
directed each of them to file a Pa.R.A.P. 1925(b) concise statement for their
respective appeals, and they all timely complied.
Hunly’s Appeal at 672 WDA 2021
We turn first to Hunly’s appeal at docket number 672 WDA 2021. There,
Hunly raises the following issues for our review:
1. Do the record facts and law support the trial court’s finding of
fraud by … Hunly?
2. Do the record facts and law support the trial court’s finding of
conspiracy by … Hunly?
3. Did Longwood waive its claims against [Hunly]?
____________________________________________
4In the captions of these notices of appeal, only the trial court docket number
GD 15-015968 was listed.
5In addition to the appeals addressed in this writing, there are multiple other
appeals related to this matter before our Court at docket numbers 670 WDA
2021, 674 WDA 2021, 676 WDA 2021, 677 WDA 2021, and 733 WDA 2021.
6 In the caption of this notice of appeal, Hunly only listed GD 17-001195.
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Hunly’s Brief at 672 WDA 2021 (“Hunly’s Brief I”) at 7.7
Hunly’s First Issue
In Hunly’s first issue, Hunly contests the trial court’s findings related to
fraud in a two-prong argument. To begin, Hunly argues that the evidence was
insufficient to prove fraud. Specifically, it states that “the record does not
reveal any material misrepresentation by [Hunly] or any intent by [Hunly] to
cause Longwood to rely on any misrepresentation.” Hunly’s Brief I at 18
(citation omitted). Further, Hunly says that, even if McCollum had somehow
misrepresented or failed to disclose an association between McCollum, Hunly,
Aufman, and Sepcic, “the record does not prove that Longwood relied on any
such misrepresentation. To the contrary, Longwood agreed to pay the prices
charged by [Hunly] because those prices were lower than those charged by
____________________________________________
7 Longwood urges us to quash Hunly’s appeal due to, inter alia, the vagueness
and breadth of Hunly’s claims, and its failure to follow the Rules of Appellate
Procedure. See Longwood’s Brief at 672 WDA 2021 at 24-31. While we
admonish Hunly for its lack of specificity and non-compliance with our Rules
of Appellate Procedure — particularly with respect to its deficient reproduced
record that primarily contains only its own trial exhibits — we decline to quash
its appeal, as we can sufficiently identify the issues raised by Hunly. See
Grimm v. Universal Medical Services, Inc., 156 A.3d 1282, 1284 n.2 (Pa.
Super. 2017) (declining to quash appeal because the appellants’ “failure to
file a reproduced record does not ‘preclude our ability to properly evaluate and
address the substantive arguments advanced by the parties’”) (citation
omitted); Kern v. Kern, 892 A.2d 1, 6 (Pa. Super. 2005) (“[A]s a practical
matter, this Court quashes appeals for failure to conform to the Rules of
Appellate Procedure only where the failure to conform to the Rules results in
the inability of this Court to discern the issues argued on appeal. [The
a]ppellants’ failure to conform to the Rules of Appellate procedure regarding
[their] brief cannot be condoned, but [the a]ppellants’ failure has not
hampered our review.”) (citation omitted).
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Bonura [Cabinets] and were within the benchmarks set by Longwood.” Id.(citations omitted). Further, Hunly advances that, “whatever may have been
the associations between McCollum, Aufman, Sepcic, and [Hunly], the fact
remains that Longwood — after determining as early as October 2014 that
there was some association — continued to use and pay [Hunly] through the
summer of 2015." Id. at 19 (citations omitted). Thus, according to Hunly,
“Longwood knew of business and social associations among the [d]efendants
but Longwood continued to use [Hunly’s] services. Longwood did not care
about any associations because Longwood was receiving high-quality
renovations at prices below what the prior contractor had charged.” Id.(citations omitted).
In addition to contesting Longwood’s failure to prove the elements of
fraud, Hunly challenges the trial court’s damages award relating to the
fraudulent conduct. For a fraudulent overcharge, Hunly maintains that “[t]he
measure of damages [is] the difference between the fair market value and
any overcharge[,]” and complains that “Longwood did not establish the fair
market value of its renovations.” Id. at 20 (citation omitted). Instead of
establishing the fair market value of the renovations, Hunly says Longwood
“incorrectly sought to show that [Hunly’s] mark-up/profit was somehow too
high and was somehow improper in light of a national average of mark-ups as
calculated in a study that was referenced by one or both of Longwood’[s]
experts.” Id. at 20-21 (citation omitted). Hunly says that the study relied on
by Longwood’s damages expert — Brian Kassalen — presented an average
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mark-up for commercial and industrial jobs, not residential projects, and failed
to consider numerous variables that affect the mark-ups on construction work,
such as market conditions, geography, project size, etc. Id. at 21. Further,
Hunly suggests that Kassalen “ignored numerous business” expenses that
Hunly had paid, which in turn affected the calculation of its profit margin. Id.8
Finally, Hunly complains that “Longwood did not demonstrate [that] there was
even a single general contractor on the open market who would have charged
less than [Hunly,]” and claims that “Longwood itself confirmed that [Hunly]
was charging the lowest available prices.” Id. at 20 (citation omitted).
We apply the following standard and scope of review to challenges to a
non-jury verdict:
Our standard of review in non-jury trials is to assess whether the
findings of facts by the trial court are supported by the record and
whether the trial court erred in applying the law. Upon appellate
review[,] the appellate court must consider the evidence in the
light most favorable to the verdict winner and reverse the trial
court only where the findings are not supported by the evidence
of record or are based on an error of law. Our scope of review
regarding questions of law is plenary.
Woullard v. Sanner Concrete and Supply, 241 A.3d 1200, 1207 (Pa.
Super. 2020) (citations omitted).
This Court has previously stated that:
In order to prove fraud[,] the following elements must be shown:
(1) a representation; (2) which is material to the transaction at
hand; (3) made falsely, with knowledge of its falsity or
recklessness as to whether it is true or false; (4) with the intent
____________________________________________
8 In its brief, Hunly only specifically identifies a $20,000 payment made to
supplier, Abbey Glass, that Kassalen purportedly ignored. Hunly’s Brief I at
21.
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of misleading another into relying on it; (5) justifiable reliance on
the misrepresentation; and (6) the resulting injury was
proximately caused by the reliance.
Milliken v. Jacono, 60 A.3d 133, 140 (Pa. Super. 2012) (en banc) (citation
omitted).
Moreover,
[f]raud consists of anything calculated to deceive, whether by
single act or combination, or by suppression of truth, or
suggestion of what is false, whether it be by direct falsehood or
by innuendo, by speech or silence, word of mouth, or look or
gesture. It has been said that fraud may induce a person to assent
to something which he would not otherwise have done, or it may
induce him to believe that the act which he does is something
other than it actually is. To be actionable, the misrepresentation
need not be in the form of a positive assertion. It is any artifice
by which a person is deceived to his disadvantage. It may be by
false or misleading allegations or by concealment of that which
should have been disclosed, which deceives or is intended to
deceive another to act upon it to his detriment. It is well settled
that fraud is proved when it is shown that the false representation
was made knowingly, or in conscious ignorance of the truth, or
recklessly without caring whether it be true or false. It has also
been established that the deliberate nondisclosure of a material
fact amounts to a culpable misrepresentation no less than does
an intentional affirmation of a material falsity. … A
misrepresentation is material when it is of such a character that if
it had not been made, the transaction would not have been
entered into.
See Delahanty v. First Pennsylvania Bank, N.A., 464 A.2d 1243, 1251-
52 (Pa. Super. 1983) (cleaned up).
Here, the trial court found that Hunly committed fraud, explaining:
[T]he elements of fraud have undoubtedly been met. … McCollum,
Hunly, Aufman, and Sepcic[] each made various material
misrepresentations, the most pertinent of which are as follows:
First, between January and February of 2014, McCollum
represented that Hunly was a general contractor and came highly
recommended by other contractors. However, Hunly was not
incorporated until March of 2014, and thus[,] there was no basis
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for these assertions. Second, in both an attempt to financially
benefit from the recommendation of Hunly, as well as to create
the impression of a competitive bidding process, McCollum
persuaded Longwood to hire and pay Hunly as a general
contractor via misrepresenting that Hunly charged significantly
less than Bonura Cabinets, a contractor whom Longwood
successfully engaged in the past. However, Hunly’s prices were
not fair in comparison to other contractors, and the bidding
process was ultimately illusory. Third, McCollum misrepresented
that Hunly was performing the tasks of general contractor. In
reality, McCollum performed all work to the contract, Hunly merely
operated as a shell, and McCollum extracted the lion’s share of the
Longwood profits. Fourth, despite being friends and business
partners for many years, both McCollum and Aufman denied the
existence of any conflict of interest.
The parties had a mutual understanding that McCollum would
utilize his construction expertise to obtain fair prices for
Longwood. Because McCollum was responsible for gathering
information regarding the scope of the work for each unit,
McCollum also presented Hunly’s bids for each unit. McCollum
would then create and sign a capital request form, which McCollum
sent to Peterson for final approval. Peterson verified the scope of
work and the amount of money needed, and then approved the
capital request forms. Peterson deferred to McCollum’s opinions
due to McCollum’s purported, superior construction experience.
McCollum thereafter managed Hunly’s invoices and submitted
them to Longwood’s Accounts Payable Department. McCollum’s
irregular presentation of Hunly’s invoices towards the third
quarter of 2014 (and onwards) made it difficult to verify whether
final invoices were in conformity with the original capital request
form, which were approved by Peterson. Throughout this process,
Hunly charged an exorbitant mark-up, while not performing any
actual work itself. In fact, all the work Hunly was supposed to
perform was instead performed by McCollum, as it was McCollum
who engaged the Subcontractors and monitored their work,
arguably on Hunly’s behalf.
McCollum also eventually received most of Hunly’s profits, as
Grah[m] extracted $900,000.00 from Hunly, and then issued
checks to Fairbanks Holding Co., Inc. (a company that Aufman
formed for McCollum) totaling $868,000.00. Furthermore, Hunly
made payments to McCollum’s other company, W.F. Cody, in the
amount of $282,075.00.
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TCO at 16-17 (internal citations omitted).
Further, with respect to Hunly’s argument that Longwood learned of the
associations between the defendants through an anonymous letter sent in
October of 2014, and nevertheless continued to use Hunly’s services, the trial
court opined:
The anonymous letter outlining McCollum’s conflict of interest is
not sufficient to defeat Longwood’s justifiable reliance. Reliance
is not justifiable if the recipient of the misrepresentations knows
it to be false, or if its falsity is obvious. Toy v. Metropolitan Life
Ins. Co., 928 A.2d 186, 2[07-]08 ([Pa.] 2007). Although the
letter did raise suspicions regarding the conflict of interests, there
was no actual knowledge and the falsity was not obvious.
Longwood took reasonable steps to investigate the matter,
including confronting McCollum and Hunl[y]. McCollum and
Hunl[y] made further misrepresentations regarding the conflict of
interest in order to convince Longwood that the allegations were
false. Longwood was only able to uncover the fraud when John
Bulger replaced McCollum and through discovery obtained in this
litigation. Therefore, Longwood’s justifiable reliance persisted
through the final payment made to Hunl[y].
Trial Court Memorandum and Non-Jury Verdict (“TCMNV”), 4/14/20, at 15-16.
The record supports the trial court’s factual findings, and we agree with
its legal conclusion that the elements of fraud have been met. Hunly
represented that it was an established general contractor, had no conflicts of
interest, and charged reasonable prices. In making these representations,
Hunly knew that they were false and made them with the intent to mislead
Longwood. Longwood, in turn, justifiably relied on these misrepresentations,
causing it to overpay for construction work.
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As for Hunly’s argument that the trial court’s damages award of
$933,220.71 was improper, no relief is due on this basis either. With respect
to these damages, the trial court conveyed:
In this case, McCollum’s illusory bidding process, his deliberate
mismanagement of Hunly’s vague invoices, and his destruction of
documents made it impossible to calculate the actual value of
Hunly’s services on a per unit basis. Thus, Longwood could not
completely rely on the poorly kept, incomplete, and unaudited
invoices that Longwood obtained through discovery. Longwood
was instead forced to take an aggregated approach based upon
Hunly’s total income and Hunly’s total expenses. Longwood had
to use these figures in order to assess what Longwood actually
paid in comparison to what Longwood should have paid.
Longwood’s aggregate approach was appropriate in this
circumstance because Longwood was Hunly’s sole client, and
Hunly did not have any legitimate costs (with the exception of the
Subcontractors’ invoices).
In support of its damages, Longwood submitted the expert
testimony of Brian Kassalen (“Kassalen”), a partner at the
accounting firm Arnett Carbis Toothman. Kassalen is a Certified
Public Accountant, and he is certified in financial forensics. By
examining the difference between Hunly’s legitimate costs, and
Hunly’s total income, Kassalen concluded that Hunly charged
Longwood a mark[-]up of approximately 130%. In order to
calculate the actual value of Hunly’s services, i.e., the amount
Longwood should have paid, Longwood took a reasonable mark[-
]up that a general contractor would charge according to fair
industry standards, and then added that mark[-]up to Hunly’s
contract costs. Kassalen derived the average industry standard
mark[-]ups from data provided by the Risk Management
Association (RMA) and other industry data. Longwood further
submitted persuasive authority regarding other instances where
courts accepted RMA data for the purpose of calculating
reasonable profit margins in lieu of a company’s unreliable
recorded data. Kassalen’s reasonable mark[-]ups were further
corroborated by Michael Dell’Isola, Longwood’s construction
expert.
Considering all of the above[-]mentioned facts, and given that this
[c]ourt found both Kassalen and Dell’Isola to be properly qualified
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experts, this [c]ourt determined that Longwood’s method for
calculating damages was reasonable under the circumstances.
Any uncertainty in the damage calculations is a direct result of
McCollum’s and Hunly’s fraudulent actions. Accordingly, this
[c]ourt correctly found that Longwood incurred damages in the
amount of $933,220.70.
TCO at 20-21 (footnote and internal citation omitted; emphasis in original).
We agree with the trial court that Longwood’s method for calculating
damages was reasonable under the circumstances. To the extent Hunly insists
that the measure of damages for a fraudulent overcharge is the difference
between the fair market value and the overcharge, it cites only one case in
support of that proposition: Sands v. Forrest, 434 A.2d 122 (Pa. Super.
1981). In Sands, the buyers purchased a farm for $85,000, with $60,000 of
that sum allocated for the real estate and the remaining $25,000 allocated for
certain personalty. Id. at 123. After taking possession of the farm, the buyers
discovered that it needed substantial repair and that various items of
personalty that they were supposed to receive were missing. Id. The buyers
subsequently brought a fraudulent misrepresentation action against the
sellers, in which the buyers claimed as damages the costs of making the
necessary repairs to the real estate and the costs of acquiring the missing
personalty. Id.At trial, the buyers proffered evidence that the sellers had represented
that the property was in good condition and that certain items were being sold
with the real estate. Id. at 123-24. They also attempted to show the cost of
repairing the premises and replacing the missing personalty, to which the
sellers objected on the basis that the cost of making repairs was not the
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correct measure of damages. Id. at 124. The trial court agreed with the
sellers, ascertaining that the correct measure of damages was the difference
between the actual value of the property and its value if it had been as
represented by the sellers. Id. Based on the trial court’s ruling, the buyers’
counsel sought to amend the complaint and offered to produce evidence of
the value of the property in the condition found by the buyers when they took
possession; however, the trial court did not allow an amendment and a
directed verdict was entered in favor of the sellers. Id.The buyers appealed. On appeal, we recognized that “[t]he law in
Pennsylvania is clear that in an action for fraud and deceit the measure of
damages is the difference in value between the real, or market, value of the
property at the time of the transaction and the higher, or fictitious, value
which the buyer was induced to pay for it.” Id. (citations omitted). We went
on to determine that the trial court was correct about the proper measure of
damages, but nevertheless erred in entering a directed verdict in favor of the
sellers and in not permitting the buyers to amend their complaint. Id. at 124-
25.
In the case at bar, the trial court opined that “Sands is distinguishable
from the case at hand because it involved the fraudulent sale of a property
and not construction that was performed on a property.” TCMNV at 21
(emphasis in original). We agree. This matter did not involve the sale of
property but instead concerned renovations done to various units at
Longwood’s facility. Cf. Peters v. Stroudsburg Trust Co., 35 A.2d 341, 343
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(Pa. 1944) (“[T]he measure of damages in an action for deceit in the sale of
property is the loss which the fraud inflicts, that is, the difference between
the real, or market, value of the property at the time of the transaction and
the higher, or fictitious, value at which it was purchased.”) (citations omitted;
emphasis added). Further, although Kassalen did not evaluate the fair market
value of the renovations, his calculations nevertheless reflected the difference
between the value Longwood should have paid for a general contractor’s
services relating to its renovation projects and the value it actually paid due
to Hunly’s fraudulent conduct. See Delahanty, 464 A.2d at 1257 (“Under
Pennsylvania law, in an action based on fraud, the measure of damages is
‘actual loss’, and not the benefit, or value, of that bargain. The victim is
entitled to all pecuniary losses which result as a consequence of his reliance
on the truth of the representations.”) (citations omitted). Thus, given the
argument and authority set forth by Hunly, we reject its claim that Longwood
had to establish the fair market value of its renovations when proving
damages.
Similarly, Hunly’s claims that Kassalen ignored various business
expenses that Hunly had paid, and relied on an inappropriate study, also do
not warrant relief. It is well-established that:
The determination of damages is a factual question to be decided
by the fact-finder. This duty of assessing damages is within the
province of the fact-finder and should not be interfered with unless
it clearly appears that the amount awarded resulted from
partiality, caprice, prejudice, corruption or some other improper
influence. The fact-finder must assess the worth of the testimony,
by weighing the evidence and determining its credibility, and by
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accepting or rejecting the estimates of the damages given by the
witnesses. In reviewing the award of damages, the appellate
courts should give deference to the decisions of the trier of fact
who is usually in a superior position to appraise and weigh the
evidence.
Lokay v. Lehigh Valley Co-op. Farmers, Inc., 492 A.2d 405, 410 (Pa.
Super. 1985) (citations omitted).
At trial, the court heard that, in calculating damages, Kassalen used the
industry average gross profit percentage for commercial and institutional
building contractors, instead of the average for residential remodelers. N.T.
Trial, 3/8/19, at 1126, 1140-44. Kassalen explained that he chose the
commercial-and-institutional-building-contractors average because, among
other reasons, he thought it best aligned with Hunly’s business. See id. at
1140. In comparison, he said that he took residential remodelers to mean “a
residential development like a home[,]” and did not believe that Hunly was a
residential remodeler Id. at 1143. The trial court also heard that the industry
average gross profit percentage used by Kassalen was a national average, not
a western Pennsylvania average, and that many variables affect markup, such
as project size, the type of work performed, business size, etc. See id. at
1008-10, 1138-39, 1150-52, 1169. However, Kassalen noted that RMA data
is generally relied upon by him and his construction-accounting peers, and
detailed that “companies provide[] their financial statements to RMA. RMA
pulls their financial statements into whatever software they would use, and it
is based on all of the companies’ submissions to RMA.” Id. at 1127-28.
Kassalen also clarified that, when calculating Hunly’s contract costs, he did
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not include expenses recorded by Hunly but not supported by either an invoice
or a check. Id. at 1157-59, 1193-94. In doing so, Kassalen explained that
Hunly “could put whatever they want in their general ledger detail[,]” and
relayed that he could not find supporting paperwork for some expenses
despite looking for it. Id. at 1193-94.
As the fact-finder, the trial court weighed this evidence and accepted
the estimates of the damages given by Kassalen for the reasons mentioned
supra. Because we discern no error of law or partiality, caprice, prejudice,
corruption or some other improper influence with respect to the trial court’s
award, and given that there is support for the trial court’s award in the record,
we decline to disturb it.9
____________________________________________
9 With respect to Hunly’s claim that Kassalen did not account for $20,000.00
that Hunly had paid Abbey Glass in his calculations, we deem that claim
waived, as it is not developed properly for our review. See Hunly’s Brief I at
21 (stating, without any further explanation, that “[a] similar instance of
Kassalen’s errors is that he did not include $20,000.00 that [Hunly] paid
Abbey Glass, a supplier [for] Longwood[’s] renovations”). The only support
that Hunly provides in its argument for this claim is a citation to a single page
in the trial transcript, which contains Aufman’s testimony that Abbey Glass
had billed both Longwood and Hunly for the same work in the amount of
$20,000.00, and that both entities subsequently paid Abbey Glass that
amount. N.T. Trial, 3/11/19, at 1279-80. Aufman testified that he believed
that Abbey Glass kept the check from Hunly and returned the other check to
Longwood. Id. at 1280. However, Hunly offers no additional elaboration or
corroboration on this claim and does not even discuss the page of the trial
transcript it cites. Accordingly, this claim is waived. Milby v. Pote, 189 A.3d
1065, 1079 (Pa. Super. 2018) (“The failure to develop an adequate argument
in an appellate brief may result in waiver of the claim under Pa.R.A.P. 2119.
We shall not develop an argument for an appellant, nor shall we scour the
record to find evidence to support an argument; instead, we will deem the
issue to be waived.”) (cleaned up); In re R.D., 44 A.3d 657, 674 (Pa. Super.
(Footnote Continued Next Page)
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Hunly’s Second Issue
In Hunly’s second issue, it argues that the facts and law do not support
the trial court’s finding of conspiracy. It contends that, “[g]iven Longwood’s
failure to prove actual legal damage, its conspiracy claims should also have
failed.” Hunly’s Brief I at 22 (citation omitted). In addition, it advances that
“[t]he trial record revealed no common unlawful purpose or agreement
involving [Hunly] to do an unlawful act or to do a lawful one for an unlawful
purpose. There was no proof of any overt act in pursuance of some unlawful
purpose.” Id. at 22-23 (citations omitted). We disagree.
“The essential elements of a claim for civil conspiracy are as follows: (1)
a combination of two or more persons acting with a common purpose to do
an unlawful act or to do a lawful act by unlawful means or for an unlawful
purpose, (2) an overt act done in pursuance of the common purpose, and (3)
actual legal damage.” Phillips v. Selig, 959 A.2d 420, 437 (Pa. Super. 2008)
(citations omitted). The trial court determined that Hunly participated in a
civil conspiracy, opining:
This [c]ourt finds that the various and numerous overt
misrepresentations and concealments of fact made by McCollum,
Hunly, Sepcic, and Aufman[] were done with the common purpose
of fraudulently inducing Longwood to engage Hunly as a general
contractor and in accepting its extremely overpriced bids.
Additionally, McCollum and Aufman’s deliberate
____________________________________________
2012) (“[I]t is an appellant’s duty to present arguments that are sufficiently
developed for our review. The brief must support the claims with pertinent
discussion, with references to the record and with citations to legal authorities.
We will not act as counsel and will not develop arguments on behalf of an
appellant.”) (citations and quotation marks omitted).
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misrepresentations regarding the apparent conflict of interest was
intended to fraudulently induce Longwood to keep Hunly as its
general contractor. Therefore, this court properly found that
McCollum, Aufman, Hunly and Sepcic unlawfully conspired against
Longwood, and hence [are] liable for the same.
TCO at 18.
We concur with the trial court’s analysis. Hunly acted with McCollum,
Aufman, and Sepcic to commit fraud. They worked together to convince
Longwood that Hunly was an experienced general contractor, had no conflicts
of interest, and charged fair prices. Further, for the reasons set forth supra,
Longwood sustained actual legal damage as a result, in that it substantially
overpaid for Hunly’s services. As the record supports the trial court’s findings
of fact, and because the elements of civil conspiracy have been established,
no relief is due on this basis.
Hunly’s Third Issue
In Hunly’s third issue, Hunly insists that Longwood waived its claims
against it. It argues that Longwood learned that McCollum and Hunly had a
pre-existing association in October of 2014, and concluded that it was being
overcharged by Hunly in May of 2015. Hunly’s Brief I at 24. Despite this
information, Hunly says that Longwood “chose to ignore any alleged
overcharge and to remit payment to [Hunly] in June and July of 2015.” Id.
(citation omitted). According to Hunly, “Longwood’s actions of continuing to
use [Hunly’s] services and continuing to pay [Hunly,] after knowing of the
parties’ associations and after believing [Hunly] was overcharging[,] are
inconsistent with Longwood’s later assertion that the [Hunly-Longwood]
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contracts and [Hunly] invoices were invalid because of fraud, conspiracy, or
any other wrong.” Id. at 25. By continuing to use and pay Hunly, Hunly
claims that Longwood “waived any claim to recover amounts from [Hunly] for
fraud, conspiracy, or any other civil wrong.” Id. at 25-26 (citations omitted).
Again, we disagree. Our Supreme Court has stated:
A waiver in law is the act of intentionally relinquishing or
abandoning some known right, claim or privilege. To constitute a
waiver of legal right, there must be a clear, unequivocal and
decisive act of the party with knowledge of such right and an
evident purpose to surrender it[.] Waiver is essentially a matter
of intention. It may be expressed or implied. In the absence of
an express agreement[,] a waiver will not be presumed or implied
contrary to the intention of the party whose rights would be
injuriously affected thereby, unless by his conduct the opposite
party has been misled, to his prejudice, into the honest belief that
such waiver was intended or consented to. In short, the doctrine
of implied waiver in Pennsylvania applies only to situations
involving circumstances equivalent to an estoppel, and the person
claiming the waiver to prevail must show that he was misled and
prejudiced thereby[.]
Brown v. City of Pittsburgh, 186 A.2d 399, 401 (Pa. 1962) (cleaned up;
footnotes omitted).
In response to Hunly’s waiver argument, Longwood persuasively
counters:
The [t]rial [c]ourt correctly found that the anonymous letter was
not sufficient to put Longwood on notice of the fraud that was
taking place at the hands of Hunl[y] and its co-conspirators.
Without such knowledge, there can be no waiver. Longwood did
not even know it was being defrauded, so it could not possibly
have waived any rights, claims, or defenses with respect thereto.
The reason why Longwood continued to use Hunl[y] after receipt
of the anonymous letter was because it had investigated the
allegations in the letter at the time and determined them (albeit
erroneously) to be unfounded. Only after years of litigation and
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extensive forensic investigation did Longwood become aware of
the nature and extent of the fraudulent conspiracy that had
victimized it. Again, the [t]rial [c]ourt agreed that Longwood went
above and beyond what the law required in order to continue
justifiably relying on Hunl[y], Aufman, Sepcic, and McCollum’s
misrepresentations.
Similarly, the reason why Longwood continued to pay Hunl[y] …
was because Longwood reasonably believed at the time (again,
erroneously) that it had a contractual obligation to do so. At the
time, while Longwood may have been “suspicious” that Hunl[y]
was overcharging it, the scope and scale of Hunl[y]’s fraud
remained concealed. John Bulger, who had replaced McCollum as
the head of the unit turnovers at Longwood, was new to the job
and faced with angry, unpaid Subcontractors threatening work
stoppages, Aufman’s threats of litigation and continued
withholding of support for Hunley’s over-inflated invoices, and
residents ready to move into incomplete units. Under those
circumstances, Bulger and Longwood rightly believed that they
had no choice but to pay Hunl[y]. When they did, Hunl[y]
persisted in its failure to pay the Subcontractors.
Under these circumstances, no waiver of any kind can be imputed
to Longwood.
Longwood’s Brief at 672 WDA 2021 at 50-52 (internal citations omitted).
As Longwood aptly points out, because it did not have full knowledge of
Hunly’s fraud at the time it received the anonymous letter and when it made
payments to Hunly in June and July of 2015, it could not act to intentionally
relinquish or abandon its claims against Hunly. Put simply, Longwood did not
realize at the time the existence and extent of Hunly’s fraud, such that it could
have knowingly waived its claims against Hunly. See N.T. Trial, 3/11/19, at
1371-73 (John Bulger’s testifying that, as of June 18, 2015, he knew Hunly
overcharged on some things, but did not know the size and scope of the
overcharges); see also id. at 1402-03 (similar); N.T. Trial, 3/6/19, at 670
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(PSC’s Chief Financial Officer’s testifying that, in May of 2015, Longwood did
not know what Hunly’s overcharge was, but that John Bulger surmised that
“there [were] costs exceeding what he would normally receive for the scope
of work being completed”). Further, with respect to the June and July of 2015
payments, there was testimony at trial that Longwood made these payments
to Hunly so that Hunly would pay the Subcontractors. See N.T. Trial, 3/6/19,
at 663-65, 671; N.T. Trial, 3/11/19, at 1351, 1373-74, 1394-95. Thus, even
if Longwood fully knew of its claims against Hunly at that point (which it did
not), we do not view Longwood’s paying Hunly so that Hunly could pay the
Subcontractors as a ‘clear, unequivocal and decisive act’ that Longwood
wished to surrender its rights. Finally, we are unconvinced that Hunly was
misled by any of Longwood’s actions to its prejudice. Therefore, this claim
likewise lacks merit.
In sum, none of Hunly’s claims in its appeal at docket number 672 WDA
2021 are meritorious. Consequently, we affirm the trial court’s May 11, 2021
judgment at GD 15-015968 with respect to Hunly.
Aufman’s Appeal at 673 WDA 2021
We next examine Aufman’s appeal at docket number 673 WDA 2021.
In this appeal, Aufman presents the following issues for our review:
1. Do the record facts and law support the trial court’s finding of
fraud by … Aufman?
2. Do the record facts and law support the trial court’s finding of
conspiracy by … Aufman?
3. Did Longwood waive its claims against Aufman?
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4. Do the record facts and law support the trial court’s decision to
disregard [Hunly’s] corporate form and impose personal liability
on … Aufman?
Aufman’s Brief at 7.10, 11
Aufman’s First Issue
In Aufman’s first issue, he contests the trial court’s finding of fraud
against him. His arguments pertaining to fraud are virtually identical to those
raised by Hunly, supra.12 Thus, we rely on our reasoning set forth above in
disposing of Aufman’s first issue. See Hunly’s First Issue at 672 WDA 2021,
supra.13 No relief is due on this basis.
____________________________________________
10 We have re-ordered Aufman’s issues for ease of disposition.
11 With respect to Aufman’s appeal, Longwood similarly asserts that it should
be quashed due to its breadth, vagueness, and non-compliance with our Rules
of Appellate Procedure. However, for the reasons we declined to quash
Hunly’s appeal, we likewise refuse to quash Aufman’s appeal. See footnote
7, supra. Nevertheless, we rebuke him for failing to follow the Rules.
12 Aufman, Hunly, and Sepcic are represented by the same attorney on appeal.
13 Specifically with respect to Aufman, Longwood notes:
Aufman was at all times the “face” of Hunl[y] — Sepcic in fact did
not communicate with Longwood at all until July of 2015. The
Court should recall that McCollum was the “inside man” who was
employed by Sodexo to work at Longwood as facilities manager.
Aufman, meanwhile, sent virtually all of the correspondence on
behalf of Hunl[y], prepared all the fraudulent, over-inflated
invoices, and controlled Hunl[y]’s bank accounts. Aufman also
perpetrated two blatantly false, yet extremely material,
misrepresentations to Longwood; specifically: (1) Aufman lied
when he wrote in an email that “John McCollum does not hold any
financial interest in my company (ies) as an investor, or as an
employee, or any other way”[, see N.T. Trial, 3/6/19, at 450];
and (2) Aufman told John Bulger that, if Bulger issued Hunl[y]
(Footnote Continued Next Page)
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Aufman’s Second Issue
In Aufman’s second issue, he questions whether the facts and law
support the trial court’s finding of conspiracy against him. Similar to Aufman’s
first issue, his arguments relating to conspiracy effectively duplicate those set
forth by Hunly, supra. Therefore, we incorporate our reasoning provided
above in resolving Aufman’s second issue. See Hunly’s Second Issue at 672
WDA 2021, supra. No relief is due on this basis either.
Aufman’s Third Issue
In Aufman’s third issue, he avers that Longwood waived its claims
against Aufman. Once again, his argument relating to this issue largely
mirrors the argument raised by Hunly above. As a result, we deny Aufman’s
waiver argument for the reasons stated in our previous analysis of this issue.
See Hunly’s Third Issue at 672 WDA 2021, supra.
Aufman’s Fourth Issue
In Aufman’s fourth issue, he challenges whether the facts and law
support the trial court’s decision to disregard Hunly’s corporate form and
impose personal liability on Aufman. See Aufman’s Brief at 25. He initially
contends that “[b]ecause Longwood did not demonstrate an underlying civil
wrong for which [Hunly] or anyone is liable, and because Longwood did not
____________________________________________
payment for some outstanding (but fraudulent) invoices, Hunl[y]
and Aufman would then use that money to pay the
Subcontractors, which, of course, they did not.
Longwood’s Brief at 673 WDA 2021 at 36-37 (internal citations omitted).
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show that any actionable wrong caused damages, Longwood gave the court
no legal reason even to consider disregarding [Hunly’s] corporate [form].” Id.
As such, Hunly purports that “[t]he question of whether to disregard [Hunly’s]
corporate form was moot.” Id. (citation omitted). In addition, Aufman
maintains that Longwood “did not show that [Hunly] was a sham or façade
such that its corporate form should be overlooked.” Id. at 25-26 (citation
omitted). Rather, Aufman says that Hunly “is a duly organized corporation
which was engaged in properly profitable business with Longwood. … The fact
that [Hunly] consists of only two shareholders and/or has subsequently
experienced financial problems unrelated to the Longwood contracts are of no
moment.” Id. at 26 (citations omitted). Aufman also states that Longwood
failed to show “unusual and specific circumstances to disregard [Hunly’s]
corporate status.” Id. (citation omitted). Last, Aufman advances that,
“[e]ven if [Hunly] did wrong, there was no basis to blame Aufman.” Id.
With respect to piercing the corporate veil, our Supreme Court has
recognized:
There is a strong presumption in Pennsylvania against piercing the
corporate veil. Any court must start from the general rule that
the corporate entity should be recognized and upheld, unless
specific, unusual circumstances call for an exception.
Piercing the corporate veil is … a matter of equity, allowing
a court to disregard the corporate form and assess one
corporation’s liability against another. The corporate veil
will be pierced and the corporate form disregarded
whenever justice or public policy demand, such as when the
corporate form has been used to defeat public convenience,
justify wrong, protect fraud, or defend crime.
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The corporate form thus may be disregarded where rights of
innocent parties are not prejudiced nor the theory of the corporate
entity rendered useless.
In Ashley [v. Ashley, 393 A.2d 637, 641 (Pa. 1978)], we held
that the corporate form may be disregarded “whenever one in
control of a corporation uses that control, or uses the corporate
assets, to further his or her own personal interests.” And in
Lumax[ Indus., Inc. v. Aultman, 669 A.2d 893, 895 (Pa.
1995)], we cited favorably the Commonwealth Court’s
enumeration of factors relevant to the piercing inquiry:
“undercapitalization, failure to adhere to corporate formalities,
substantial intermingling of corporate and personal affairs, and
use of the corporate form to perpetrate a fraud.”
Mortimer v. McCool, 255 A.3d 261, 268 (Pa. 2021) (footnotes, brackets, and
most quotation marks omitted).
In the case sub judice, the trial court discerned that piercing the
corporate veil of Hunly was warranted, relaying:
This [c]ourt finds that justice and public policy demand piercing
Hunl[y]’s veil. The circumstances of this case show that neither
innocent parties will be prejudiced nor is the theory of corporate
entity undermined. Further, the factors of this case are sufficient
to defeat the presumption against veil piercing.
Hunl[y] was formed solely as part of the fraudulent scheme for
McCollum to extract money from Longwood. Hunl[y] was hired
[as] a general contractor while McCollum, who was already
receiving payment from Sodexo for his services to Longwood,
performed all the tasks associated with that role. Hunl[y] did no
actual work whatsoever. Further, Hunl[y] was mainly financed
through a loan from John McCollum’s company, W.F. Cody Corp.
Longwood was Hunl[y]’s sole client and source of revenue. Most
of that revenue funneled back to John McCollum. Now Hunl[y] is
insolvent and has no way of paying its creditors or satisfying any
judgment against it. It is clear that Aufman and Sepcic never had
an intent to use Hunl[y] for a legitimate business end. Hunl[y]
began operating before it was even incorporated. Further, there
was substantial intermingling of corporate and personal affairs.
The company was operated out of Aufman’s accounting office and
shared staff with Aufman’s other business enterprises. Those staff
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members were not compensated by Hunl[y], but instead by
Aufman’s accounting firm. Hunl[y] never had actual employees
other than John McCollum’s son, an unpaid intern that wrote
checks to his own company in the amount of $975,000.00.
It is inequitable and unjust for McCollum, Aufman, and Sepcic to
make use of the corporate form to escape their liability for their
participation in fraud. This [c]ourt finds that piercing Hunl[y]’s
veil would not undermine the theory of the corporate form. To
the contrary, this [c]ourt can find no legitimate business end that
would justify preserving Hunl[y]’s corporate form. No innocent
parties will be harmed by piercing Hunl[y]’s veil, but the inverse
is true; innocent parties will be harmed if there was no way to
recover damages from Aufman and Sepcic for their contribution
to the fraudulent scheme. Therefore, this [c]ourt finds that factors
weighing in favor of piercing the corporate veil are sufficient to
overcome the presumption against veil piercing.
TCMNV at 22-23 (internal citations omitted).
We agree with the trial court’s above-stated analysis. Aufman, Sepcic,
and McCollum created and used Hunly to perpetrate a fraud. Given the
circumstances of this case, justice demands piercing Hunly’s veil.
In conclusion, none of Aufman’s issues in his appeal at docket number
673 WDA 2021 warrant relief. We therefore affirm the trial court’s May 11,
2021 judgment at GD 15-015968 with respect to Aufman.
Sepcic’s Appeal at 675 WDA 2021
We next turn to Sepcic’s appeal at 675 WDA 2021. He presents the
following questions for our review:
1. Do the record facts and law support the trial court’s finding of
fraud by … Sepcic?
2. Do the record facts and law support the trial court’s finding of
conspiracy by … Sepcic?
3. Did Longwood waive its claims against Sepcic?
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4. Do the record facts and law support the trial court’s decision to
disregard … Hunly’s corporate form and impose personal liability
on … Sepcic?
Sepcic’s Brief at 7.14, 15
Sepcic’s First Issue
In Sepcic’s first issue, he challenges the trial court’s finding of fraud
against him. Like Aufman, Sepcic’s arguments with respect to this issue are
largely the same as those raised by Hunly. Thus, we apply the reasoning we
employed in disposing of Hunly’s first issue. See Hunly’s First Issue at 672
WDA 2021, supra.16 This issue lacks merit.
Sepcic’s Second Issue
____________________________________________
14 As with Aufman, we have re-ordered Sepcic’s issues to facilitate our
disposition.
15As with Hunly and Aufman, Longwood similarly requests that Sepcic’s appeal
be quashed. We continue to decline to do so but chastise him for his failure
to follow our Rules. See footnote 7, supra.
16 Regarding Sepcic, Longwood points out that:
Sepcic was the first person that McCollum approached about
“forming a construction company.” Specifically, it was McCollum
who told Sepcic to contact Aufman to further this objective. After
he was installed as Sodexo’s on-site manager at Longwood,
McCollum contacted Aufman and Sepcic[,] and asked them if they
wanted to do contracting work for PSC. Sepcic was a founding
shareholder of Hunl[y] and owned 80% of the company. Then,
near the end of the scheme, it was Sepcic who sent fraudulent
collection letters to Longwood, demanding payment of Hunl[y]’s
over-inflated invoices. [See N.T. Trial, 3/12/19, at 1616-18.]
Longwood’s Brief at 675 WDA 2021 at 37 (internal citations omitted).
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In Sepcic’s second issue, he claims that the trial court’s conspiracy
verdict was unsupported by fact and law. Again, his arguments on this issue
essentially mirror those raised by Hunly. As such, in addressing this issue, we
rely on our analysis pertaining to Hunly’s conspiracy argument. See Hunly’s
Second Issue at 672 WDA 2021, supra. No relief is granted.
Sepcic’s Third Issue
In Sepcic’s third issue, he says that Longwood waived its claims against
him. Once more, his arguments echo those raised by Hunly. We therefore
apply our above-stated waiver analysis to Sepcic’s third issue. See Hunly’s
Third Issue at 672 WDA 2021, supra. Longwood did not waive its claims.
Sepcic’s Fourth Issue
In Sepcic’s last issue, he questions the trial court’s decision to impose
personal liability on him, disregarding Hunly’s corporate form. He reiterates
Aufman’s arguments for why the trial court should not have done so. Thus,
we reject Sepcic’s issue on the same basis that we rejected Aufman’s claim.
See Aufman’s Fourth Issue at 673 WDA 2021, supra.
Overall, none of Sepcic’s issues at docket number 675 WDA 2021 merit
relief. We consequently affirm the trial court’s May 11, 2021 judgment at GD
15-015968 as it relates to Sepcic.
Hunly’s Appeal at 671 WDA 2021
Finally, we reach Hunly’s appeal at 671 WDA 2021. There, Hunly poses
the following questions for our review, which we have re-ordered for ease of
disposition:
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1. Do the record facts and law support the trial court’s finding of
fraud and/or conspiracy by [Hunly] such that Longwood is
somehow excused from paying for construction work it received?
2. Did Longwood waive any purported defense to [Hunly’s] causes
of action?
3. Did the trial court err both factually and legally by failing to find
that Longwood breached its contracts with [Hunly]?
4. Did the trial court err both factually and legally by failing to find
that Longwood was unjustly enriched?
5. Did the trial court err both factually and legally by failing to find
that Longwood violated the [CASPA]?
Hunly’s Brief at 671 WDA 2021 (“Hunly’s Brief II”) at 7.17
Hunly’s First, Second, and Third Issues
In Hunly’s first, second, and third issues, Hunly essentially questions the
trial court’s determination that Longwood did not breach its contracts with
Hunly. In reaching this conclusion, the trial court explained:
Longwood did not breach its contracts because the contracts for
which Longwood has not yet paid are void. Fraud in the
inducement renders a contract voidable at the option of the
defrauded party. Stringert & Bowers, Inc. v. On-Line Sys.,
Inc., 345 A.2d 194, 196 ([Pa. Super.] 1975). This [c]ourt has
already made a finding of fraud against all [d]efendants including
Hunl[y]. Therefore, Hunl[y]’s fraud makes the contracts voidable
at Longwood’s option. Longwood has only chosen to exercise that
option for the contracts that have not yet been paid.
TCMNV at 26-27 (internal citation omitted).
Hunly argues that the record facts and law do not support the trial
court’s findings of fraud and conspiracy, for the same reasons it advanced in
____________________________________________
17Again, Longwood asks that we quash Hunly’s appeal at 671 WDA 2021,
because of its non-compliance with our Rules. Again, we decline to do so.
See footnote 7, supra.
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its appeal at 672 WDA 2021, supra. Hunly’s Brief II at 25-31. Further, it
insists again that Longwood waived defenses to Hunly’s causes of action by
continuing to use and pay for Hunly’s services through July of 2015. Id. at
31-34. Finally, it asserts that the trial court erred in failing to find that
Longwood breached its contracts with Hunly, as “[t]he evidence showed that
[Hunly] performed and completed the agreed-upon work and submitted
proper invoices.” Id. at 23. It claims that Longwood owes it $910,538.25.
Id. at 23-24.
We discern no error committed by the trial court. As the trial court
points out, this Court has recognized that “[t]he general rule, of course, is
that fraud in the inducement renders a contract voidable at the option of the
defrauded party.” Stringert & Bowers, Inc., 345 A.2d at 196 (citations
omitted). See also Eigen v. Textron Lycoming Reciprocating Engine
Div., 874 A.2d 1179, 1184 (Pa. Super. 2005) (“Our Supreme Court and this
Court have consistently held that the victim of fraud in the inducement has
two options: (1) rescind the contract, or (2) affirm the contract and sue for
damages.”) (citations omitted)). We have already upheld the trial court’s
determination that Hunly committed fraud. See Hunly’s First Issue at 672
WDA 2021, supra. Thus, we agree with the trial court that Longwood could
void its agreements with Hunly, and therefore, did not breach any contract.18
____________________________________________
18Even if there was an enforceable contract, Longwood rightly points out that
“Hunl[y] did not perform any actual ‘general contracting services’ — it just
(Footnote Continued Next Page)
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Hunly’s Fourth Issue
In Hunly’s fourth issue, it argues that the trial court erred by failing to
find that Longwood was unjustly enriched. It argues:
In the event that this Court determined that [the Hunly-
]Longwood contracts were not valid as to any unpaid [Hunly]
invoices, [Hunly] is entitled to damages for unjust enrichment.
There was no dispute at trial that [Hunly] completed the work at
issue. There was no dispute that [the] Subcontractors worked on
the projects for which they should be paid. Peterson testified that
the prices set forth in [Hunly’s] invoices were reasonable. [Hunly]
conferred a benefit upon Longwood that it would be unjust for
Longwood to retain without payment for value. The value is the
amount on the invoice for work that was undisputedly performed
and completed, specifically $910,538.25.
Hunly’s Brief II at 24 (internal citation omitted).
We reject Hunly’s argument. “Unjust enrichment is an equitable
remedy, defined as ‘the retention of a benefit conferred by another, without
offering compensation, in circumstances where compensation is reasonably
expected, and for which the beneficiary must make restitution.’”
Commonwealth by Shapiro v. Golden Gate National Senior Care LLC,
194 A.3d 1010, 1034 (Pa. 2018) (citation omitted). Here, Hunly did not confer
any benefit upon Longwood, as it performed no actual work. Further, the
Subcontractors — who performed work but were not paid — sued certain
parties, including Longwood, in the action at GD 18-012048 to recover the
____________________________________________
used McCollum[, a Sodexo employee,] to distribute work to subcontractors
and then sent Longwood over-inflated invoices. Hunl[y] did no work and as
such could not have triggered any real or imagined contractual obligation for
Longwood to pay money.” Longwood’s Brief at 671 WDA 2021 at 54-55
(citations omitted).
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money they are owed. Therefore, giving Hunly money so that it can
purportedly pay the Subcontractors is unnecessary at this juncture.19 In
addition, we agree with the trial court’s observation that Hunly’s own actions
bar it from receiving equitable relief:
Hunly’s unjust enrichment claims are dismissed because Hunl[y]
comes with unclean hands. A court may deprive a party of
equitable relief where, to the detriment of the other party, the
party applying for such relief is guilty of bad conduct relating to
the matter at issue. In re Estate of Aiello, 993 A.2d 283, 288
(Pa. Super. … 2010). This [c]ourt finds that Hunl[y]’s fraud
precludes equitable relief.
TCMNV at 27. Thus, for the foregoing reasons, Hunly’s unjust enrichment
argument fails.
Hunly’s Fifth Issue
Finally, in Hunly’s fifth issue, it states that the trial court erred by not
finding Longwood liable under CASPA.20 Under CASPA, Hunly contends that
“Longwood is liable to [Hunly] for its claims discussed earlier in this brief, plus
____________________________________________
19 We also recognize that Longwood has previously given money to Hunly so
that Hunly would pay the Subcontractors, only to have Hunly fail to do so.
See TCO at 7 (“[W]hile Bulger’s investigation of the Hunly invoices remained
ongoing, Longwood began issuing large checks to Hunly in reliance upon
Hunly’s promise to pay the Subcontractors within seven (7) to ten (10) days.
Nevertheless, despite receiving $613,069.50 from Longwood after McCollum
left, Hunly did not pay the Subcontractors and continued to demand more
money from Longwood.”).
20 By way of background, CASPA “protect[s] contractors and subcontractors
against not being paid promptly for the work and materials they provide on a
construction project.” East Coast Paving & Sealcoating, Inc. v. North
Allegheny School Dist., 111 A.3d 220, 230 (Pa. Cmwlth. 2015) (citations
omitted).
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a penalty at the rate of 1% per month[,] plus reasonable attorneys’ fees[,]
pursuant to 73 P.S. § 512.” Hunly’s Brief II at 25.
Again, no relief is due. Section 512 sets forth:
(a) Penalty for failure to comply with act.--
(1) If arbitration or litigation is commenced to recover
payment due under this act and it is determined that an
owner, contractor or subcontractor has failed to comply with
the payment terms of this act, the arbitrator or court shall
award, in addition to all other damages due, a penalty equal
to 1% per month of the amount that was wrongfully
withheld.
(2) An amount shall not be deemed to have been wrongfully
withheld if all of the following apply:
(i) The amount bears a reasonable relation to the
value of any claim held in good faith by the owner,
contractor or subcontractor against whom the
contractor or subcontractor is seeking to recover
payment.
(ii) The claim holder complies with section 6 or 11.
(b) Award of attorney fee and expenses.--Notwithstanding
any agreement to the contrary, the substantially prevailing party
in any proceeding to recover any payment under this act shall be
awarded a reasonable attorney fee in an amount to be determined
by the court or arbitrator, together with expenses.
73 P.S. § 512 (footnote omitted).
Because Hunly has no valid claim for payment, it is not entitled to the
penalties and attorneys’ fees provided for in Section 512. Accord TCMNV at
27 (“Hunl[y]’s [CASPA] claim is contingent on Hunl[y]’s success in its breach
of contract or unjust enrichment claims. Since this [c]ourt has found[] for
Longwood on both counts, the [CASPA] claim also fails.”). No relief is
warranted on this basis.
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J-A29003-22, J-A29004-22, J-A29005-22 & J-A29007-22
In sum, Hunly’s appeal at docket number 671 WDA 2021 lacks merit.
Accordingly, we affirm the trial court’s May 11, 2021 judgment at GD 17-
001195.
Judgment at GD 15-015968 affirmed. Judgment at GD 17-001195
affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 2/27/2023
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