Johnson, K. v. Agate Construction Co.

J-A21019-22
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
KIMBERLY BOLDEN-JOHNSON, : IN THE SUPERIOR COURT
INDIVIDUALLY AND AS THE : OF PENNSYLVANIA
ADMINISTRATRIX OF THE ESTATE OF :
JOHN CALVIN JOHNSON, DECEASED :
:
:
v. :
:
: No. 2249 EDA 2021
AGATE CONSTRUCTION COMPANY, :
INC., JOHNSTON ENTERPRISES, :
PHILAPORT; PHILADELPHIA REGIONAL :
PORT AUTHORITY :
:
:
v. :
:
:
ATLANTIC CONCRETE CUTTING, INC. :
___________________________ :
KIMBERLY BOLDEN-JOHNSON, :
INDIVIDUALLY AND AS THE :
ADMINISTRATRIX OF THE ESTATE OF :
JOHN CALVIN JOHNSON, DECEASED :
:
:
v. :
:
:
AGATE CONSTRUCTION COMPANY, :
INC., JOHNSTON ENTERPRISES, :
PHILAPORT, PHILADELPHIA REGIONAL :
PORT AUTHORITY, PENN :
WAREHOUSING AND DISTRIBUTION, :
INC., JH STEVEDORING, :
PHILADELPHIA FOREST PRODUCTS :
CENTER :
___________________________ :
KIMBERLY BOLDEN-JOHNSON, :
INDIVIDUALLY AND AS THE :
ADMINISTRATRIX OF THE ESTATE OF :
JOHN CALVIN JOHNSON, DECEASED :
J-A21019-22
:
:
v. :
:
:
COLUMBUS AVENUE GPD INVESTMENT :
LP, COLUMBUS AVENUE :
INVESTMENTS, LLC, G.P. :
DEVELOPMENT CORPORATION, IVAN :
POPKIN, ROBERT A. GOLDENBERG, :
NEW AGE FASTENING SYSTEMS, INC. :
NEW AGE RESTORATION, NEW AGE :
CORPORATION :
:
:
APPEAL OF: AGATE CONSTRUCTION :
COMPANY, INC. :
Appeal from the Judgment Entered November 8, 2021
In the Court of Common Pleas of Philadelphia County
Civil Division at No(s): 180101066, 180102308, 180502228
BEFORE: LAZARUS, J., MURRAY, J., and McCAFFERY, J.
MEMORANDUM BY MURRAY, J.: FILED SEPTEMBER 30, 2022
Agate Construction Company, Inc. (Appellant), appeals from the
judgment1 entered against Appellant and in favor of Atlantic Concrete Cutting,
____________________________________________
1 Appellant purports to appeal from the September 17, 2021, order denying
post-trial relief. “An appeal from an order denying post-trial motions is
interlocutory. Pa.R.A.P. 301(a), (c), and (d)[.] Once that judgment is entered
however, our jurisdiction is perfected.” Keystone Dedicated Logistics, Inc.
v. JGB Enters., 77 A.3d 1, 2 n.1 (Pa. Super. 2013) (some citations, ellipses,
and brackets omitted); see also Billig v. Skvarla, 853 A.2d 1042, 1048 (Pa.
Super. 2004) (where “nonsuit was entered, the appeal properly lies from the
judgment entered after denial of a motion to remove nonsuit.”). The docket
in this case reflects that judgment was entered on November 8, 2021. See
Docket Entry No. 245 (stating, “judgment entered on verdict” (capitalization
omitted)). We amended the caption accordingly. Further, we treat Appellant’s
(Footnote Continued Next Page)
-2-
J-A21019-22
Inc. (Atlantic or Atlantic Concrete), in this contractual indemnification case.
We affirm.
The trial court recounted the relevant factual and procedural history as
follows:
This indemnification action arises out of plaintiff Kimberly
Bolden-Johnson’s [(Ms. Bolden-Johnson or plaintiff)] action
against [Appellant] and a number of other defendants to recover
damages for the death of her husband, John Johnson. Mr.
Johnson, an employee of Atlantic, drowned on January 14, 2016[,]
while working on Pier 78 on the Delaware River in Philadelphia.
Philadelphia Regional Port Authority (“PRPA”) owns Pier 78. PRPA
entered into a contract with [Appellant], as the general contractor,
to renovate the pier, including the selected demolition of the
deteriorated portions of the pier’s concrete walking surface.
To complete this work, [Appellant] entered into a
subcontract with Atlantic (the “Subcontract”), pursuant to which
Atlantic was tasked with cutting concrete at the pier. The
Subcontract contained an indemnification clause [(indemnity
provision)], under which the subcontractor[,] Atlantic[,] agreed to
indemnify the general contractor[, Appellant]. It provides[, in
pertinent part]:
To the full extent permitted by law, the Subcontractor
agrees to defend, indemnify and hold harmless the
Contractor and the Owner, and their respective officers,
agents and employees and any other person or entity
required by the Contract Documents (“Indemnified
Parties”) from and against any and all Losses arising from
or relating to Work performed by the Subcontractor on
the Project, whether or not the Contractor was negligent,
unless the Contractor was solely negligent.
____________________________________________
timely notice of appeal as being filed after the entry of judgment. See
Pa.R.A.P. 905(a)(5) (“A notice of appeal filed after the announcement of a
determination but before the entry of an appealable order shall be treated as
filed after such entry and on the day thereof.”).
-3-
J-A21019-22
(Subcontract[, 11/25/15,] at 7).[2] With leave of court,
[Appellant] filed a joinder complaint against Atlantic on October
22, 2018, demanding indemnification pursuant to the
Subcontract.
On September 3, 2019, [Appellant] filed a summary
judgment motion arguing that it was a statutory employer of Mr.
Johnson and therefore immune from suit under the Pennsylvania
Worker’s Compensation Act. [See McDonald v. Levinson Steel
Co., 153 A. 424, 425-26 (Pa. 1930) (discussing statutory
employer); 77 P.S. § 462.] In support of the summary
judgment motion, [Appellant] admitted:
1. PRPA owned Pier 78. ([Motion, 9/3/19,] at ¶ 1.)
2. PRPA entered into a contract with [Appellant] as the
general contractor [(Prime Contract)] to perform
renovations to Pier 78. (Id. at ¶¶ 2 and 28.)
3. The Prime Contract included “the replacement of
deteriorated concrete along the loading dock surface,
leading dock wall rail deck, and seawall in addition to
spall repairs on the barrier and apron surface.” (Id. at
¶ 58 (quoting Prime Contract.))
4. The Prime Contract called for the cutting of concrete
surfaces. (Id. at ¶ 60.)
5. [Appellant] entered into a [S]ubcontract with Atlantic
to perform the concrete cutting work at the pier. (Id.
at ¶ 30.)
6. As the general contractor, [Appellant] was on the site
daily and occupied the area of the pier where work was
performed and oversaw the work performed by all
contractors. (Id. at ¶¶ 6 and 45.)
7. Mr. Johnson was a direct employee of Atlantic,
[Appellant’s] subcontractor. (Id. at ¶ 20.)
____________________________________________
2 The Subcontract also included a provision (choice of law provision) that
states: “This Subcontract shall be governed by and construed in accordance
with the laws of the State of New Jersey….” Subcontract, 11/25/15, ¶ 26.9.
-4-
J-A21019-22
8. [Appellant] maintained an office on site on Pier 78. (Id.
at ¶ 44.)
9. [Appellant] coordinated the work of all subcontractors.
(Id. at ¶ 46.)
10. [Appellant] conducted meetings and inspections onsite
at the pier. (Id. at ¶ 47.)
11. [Appellant] wrote up violations of subcontractors. (Id.
at ¶ 48.)
12. [Appellant] was on site daily and oversaw the work
performed by all contractors. ([Id.] at ¶ 6[.)]
Ms. Bolden-Johnson contested the summary judgment
motion, while Atlantic did not oppose summary judgment to
[Appellant] on the statutory employer theory. The Court denied
the summary judgment motion on October 31, 2019. Ms.
Bolden-Johnson subsequently settled the case with
[Appellant] for $10.5 million, and [Appellant] pursued its
indemnification claim against Atlantic.
The Court heard a bench trial on [Appellant’s]
indemnification claim against Atlantic on May 10 and 11, 2021. …
At trial, [Appellant] presented the testimony of Kevin
Durkan, plaintiff Kimberly Bolden[-]Johnson’s attorney in this
matter. Mr. Durkan testified that he produced [Ms. Bolden-
Johnson] for deposition, took 12 to 13 depositions, including all
the individuals who were at Pier 78 on the night of Mr. Johnson’s
death, and hired an expert on construction safety. Mr. Durk[a]n
testified that “in September of 2015, [] PRPA had hired [Appellant]
to rehabilitate Pier 78 including the selected demolition of the
deteriorated portions of the pier’s concrete walking surface.”
According to Mr. Durk[a]n, the contract between [] PRPA and
[Appellant] required [Appellant] to cover the openings that were
cut into the concrete and appoint a competent superintendent to
continuously monitor for safety. Furthermore, “[Appellant] had
submitted a site-specific health and safety plan for the project,
which was approved by the PRPA.” [Appellant’s] [S]ubcontract
with Atlantic provided that “[Appellant] had the responsibility to
cover the holes that were cut into the concrete.” [Durkan]
-5-
J-A21019-22
testified that, when performing the work at Pier 78, [Appellant]
would mark the area of concrete for Atlantic to cut; Atlantic would
cut the concrete; and then [Appellant] would lift the concrete,
using a crane and creating a hole. Before the close of [Appellant’s]
case, the parties agreed to submit designations and counter-
designations of the depositions of Atlantic and [Appellant]
employees for the Court’s consideration. Atlantic’s counter-
designations included the deposition of Atlantic employee Eric
Burr, who testified that [Appellant] “ran the job” at Pier 78.
At the close of [Appellant’s] case, Atlantic [orally] moved
for a compulsory nonsuit. The Court granted Atlantic’s
motion on the grounds that [Appellant] had failed to prove
that Ms. Bolden-Johnson had a valid claim against it. On
May 21, 2021, [Appellant] filed a motion for post-trial relief,
seeking: (1) removal of the compulsory non-suit in Atlantic’s
favor; (2) entry of a directed verdict in its favor; and/or (3) a new
trial. The Court denied all post-trial relief, with the exception of
amending its [written] finding[s] and conclusions to reflect [entry
of a] nonsuit instead of a directed verdict.
Trial Court Opinion, 12/16/21, at 2-6 (emphasis and footnote 2 added;
citations to record and one footnote omitted); see also id. at 6 n.2 (explaining
the trial court “orally granted Atlantic’s [post-trial] motion at a hearing
following the close of [Appellant’s] case. On May 25, 2021, the Court filed []
findings and conclusions and a trial worksheet, in which it erroneously stated
that it granted a “directed verdict” instead of a “nonsuit.” Subsequently, [on
September 17, 2021,] the Court filed amended findings and conclusions and
an amended trial worksheet to reflect [entry of a] “nonsuit” instead of a
“directed verdict.”).
Appellant timely filed a notice of appeal on October 15, 2021. The single
notice of appeal contained multiple trial court docket numbers, i.e.,
-6-
J-A21019-22
180101066 (Docket 1066), 180102308, and 180502228 (Docket 2228).3 The
trial court ordered Appellant to file a Pa.R.A.P. 1925(b) concise statement of
errors complained of on appeal. Appellant timely complied on November 8,
2021.
The trial court issued a Pa.R.A.P. 1925(a) opinion on December 16,
2021, rejecting Appellant’s challenge to, inter alia, the entry of nonsuit, and
reasoning:
To establish its indemnification claim, [Appellant] had the burden
of proving:
the scope of the indemnification agreement; the nature
of the underlying claim; its coverage by the
indemnification agreement; the reasonableness of the
alleged expenses; and, where the underlying action is
settled rather than resolved by payment of a judgment,
the validity of the underlying claim and the
reasonableness of the settlement.
Burlington Coat Factory of Pennsylvania, LLC v. Grace
Const. Mg[m]t. Co., LLC, 126 A.3d 1010, 1022 (Pa. Super.
2015) [(en banc) (citation omitted) (emphasis added); see also
Cty. of Del. v. J.P. Mascaro & Sons, Inc., 830 A.2d 587, 593
(Pa. Super. 2003) (“To establish a right to indemnification where
a case is resolved by settlement, the party must establish,” inter
alia, “that the underlying claim was valid against it”).]
[Appellant] failed to establish that Ms. [Bolden-]Johnson
had a valid claim against it. Under Pennsylvania’s Worker[s’]
Compensation Act, [77 P.S. § 1, et seq.,] an employer is immune
from tort liability for an employee’s personal injury if it meets the
five elements for a “statutory employer” set out in McDonald v.
Levinson Steel Co., 153 A. 424, 426 (Pa. 1930):
____________________________________________
3The caption of the notice of appeal stated, “consolidated under lead action,”
which, Appellant claimed, was Docket 1066.
-7-
J-A21019-22
(1) An employer who is under contract with an owner or
one in the position of an owner; (2) premises occupied
by or under the control of such employer; (3) a
subcontract made by such employer; (4) part of the
employer’s regular business entrusted to such
subcontractor; (5) an employee of such subcontractor.
After the end of [Appellant’s] case-in-chief, the record contained
uncontested evidence that [Appellant] met all five elements of the
McDonald test.
First, the evidence submitted at trial showed that PRPA, the
owner of Pier 78, entered into a contract with [Appellant], the
general contractor. The Subcontract between [Appellant] and
Atlantic identifies PRPA as the owner of Pier 78, and [Appellant]
as the contractor. Moreover, the Subcontract references the
[P]rime [C]ontract for the project between PRPA and [Appellant].
Mr. Durkan also testified that PRPA entered into a contract with
[Appellant], as the general contractor, to renovate Pier 78.
Finally, [Appellant] admitted that it entered into a contract with
PRPA in its motion for summary judgment.
Second, the evidence submitted by [Appellant] established
that it occupied and controlled the premises in question. Mr.
Durkan testified that [Appellant] directed Atlantic’s performance
of the work at Pier 78 by marking the area of concrete for Atlantic
to cut, which Atlantic would then cut. Moreover, in its motion for
summary judgment[, Appellant] admitted that it maintained an
office on the site; its supervisors were on the site every day; it
coordinated the work of the subcontractors; it conducted meetings
and inspections on the site; and it wrote up subcontractor
violations. According to Mr. Durkan, [Appellant] agreed with PRPA
to hire a competent superintendent to continuously monitor for
safety. Furthermore, “[Appellant] had submitted a site-specific
health and safety plan for the project, which was approved by the
PRPA.”
[Appellant] entered into a subcontract with Atlantic, which
satisfies the third [McDonald] element. The fourth element is
that a portion of the employer’s business be entrusted to the
subcontractor. In this matter, the Subcontract called for Atlantic
to cut concrete on the pier, a necessary activity to allow for the
renovation work of the [P]rime [C]ontract to proceed. The final
element of the statutory employer test is that the subcontractor
-8-
J-A21019-22
employ the employee. In this case, there is no dispute that Mr.
Johnson was an Atlantic employee.
Since the five elements of a “statutory employer” were
established at the end of [Appellant’s] case, the Court did not err
in holding that [Appellant] was a “statutory employer” and thus
Atlantic had no obligation to indemnify [Appellant] for the
settlement payment.
Trial Court Opinion, 12/16/21, at 11-13 (record citations omitted). The court
also stated, with respect to the “import” of its October 31, 2019, denial of
Appellant’s motion for summary judgment:
All the [c]ourt decided in October 2019 is that, in the face of Ms.
Bolden-Johnson’s opposition, material issues of fact existed
regarding the statutory employer defense, namely, whether PRPA
owned the pier; [Appellant] exercised sufficient occupancy or
control of the premises; Atlantic was a subcontractor
notwithstanding an independent contractor clause in the
[S]ubcontract; a portion of [Appellant’s] regular business was
entrusted to Atlantic; and Mr. Johnson was the employee of a
subcontractor, notwithstanding the independent contractor clause
in the [S]ubcontract. At the time of trial, [Appellant] had
admitted to all these facts, and the [c]ourt properly held it
to these admissions. Cogley v. Duncan, 32 A.3d 1288, 1292
(Pa. Super. 2011) (“Statements of fact by one party in pleadings,
stipulations, testimony, and the like, made for that party’s benefit,
are termed judicial admissions and are binding on the party.”)[
(citation omitted).] This includes [Appellant’s] admissions at
trial establishing that [Appellant] was Mr. Johnson’s
statutory employer.
Id. at 13 (emphasis added) (rejecting Appellant’s claim that “denial of
summary judgment on the statutory employer issue constitutes the law of the
case and precludes the [trial c]ourt from granting Atlantic’s motion for a
compulsory nonsuit.” (citation omitted)).
-9-
J-A21019-22
On December 29, 2021, this Court issued a Rule for Appellant to show
cause (RTSC) why we should not quash the appeal based on Commonwealth
v. Walker, 185 A.3d 969, 971 (Pa. 2018) (“where a single order resolves
issues arising on more than one docket, separate notices of appeal must
be filed for each of those cases” or the appeal will be quashed) (emphasis
added).4 See also Pa.R.A.P. 341, note; In re: M.P., 204 A.3d 976, 980-81
(Pa. Super. 2019) (stating Walker also applies in civil and family cases). In
the RTSC, we also cited Always Busy Consulting, LLC v. Babford & Co.,
Inc., 247 A.3d 1033, 1043-44 (Pa. 2021) (holding that filing one notice of
appeal from single order entered at lead docket for “consolidated civil matters
where all record information necessary to adjudication of the appeal exists,
and which involves identical parties, claims and issues, does not run afoul of
Walker [or] Rule 341”). Appellant filed a timely response, claiming its notice
of appeal was not defective and complied with Always Busy:
The underlying matter involved three separate lawsuits arising
from the same incident that were consolidated at the trial court
level during the course of the litigation. Those three cases
involved over fifteen named parties and a number of claims. All
but two parties were dismissed prior to appeal (Appellant []
and Appellee Atlantic Concrete), and all issues on appeal are
exclusive to [Appellant’s] claims against Atlantic Concrete
for contractual indemnification[.]
____________________________________________
4 The Pennsylvania Supreme Court overruled Walker, in part, in
Commonwealth v. Young, 265 A.3d 462, 477-78 (Pa. 2021) (reaffirming
that Pa.R.A.P. 341 requires separate notices of appeal when a single order
resolves issues under more than one docket, but holding Pa.R.A.P. 902
permits appellate courts to consider an appellant’s request to remedy a
Walker violation, where appellant timely filed the notice of appeal).
- 10 -
J-A21019-22
Response, 1/10/22, at 2 (unnumbered) (emphasis added). Appellant asserted
the trial court’s rulings “were entered exclusively on the lead docket and
involved only claims by [Appellant] against Atlantic Concrete.” Id.(referencing Docket 1066). On January 20, 2021, this Court discharged the
RTSC and referred the matter to the merits panel. Thus, we first address
whether we have jurisdiction to consider Appellant’s issues.
Our review of the record confirms Appellant’s claim that its single notice
of appeal complied with Always Busy and did not violate Walker. As stated
above, although this matter began as three separate cases, the trial court
consolidated the cases under Docket 1066 (see Order, 4/27/18); all
defendants aside from Atlantic and Appellant are no longer involved in the
litigation;5 and Appellant correctly states, “[t]his appeal does not involve any
other claims, parties, or interests,” aside from those implicating Atlantic and
Appellant. Response, 1/10/22, at 11 (unnumbered); see also Appellant’s
Reply Brief at 6 (“There was no improper consolidation of multiple appellate
issues or parties. Indeed, the issues on appeal arose only from [Appellant’s]
____________________________________________
5 We are unpersuaded by Atlantic’s argument that quashal is necessary
because “[Dockets] 1066 and 2228 do not involve identical parties or claims[,
where] four additional defendants were named in the latter case. Therefore,
the Always Busy exception does not apply.” Atlantic’s Brief at 7. The other
defendants are no longer involved in the case. Further, there is no merit to
Atlantic’s claim that Appellant’s appeal “attempted an impermissible
consolidation in this Court….” Id.- 11 -
J-A21019-22
claim against Atlantic Concrete, which arises exclusively from Docket 1066.”).
Accordingly, we decline to quash under Walker.
Appellant presents three issues for our review:
1. Did the Trial Court err in granting Atlantic Concrete’s oral
motion for compulsory nonsuit?
a. Did the Trial Court err in neglecting to apply New
Jersey law pursuant to the [S]ubcontract between
[Appellant] and Atlantic Concrete?
b. Did the Trial Court err in finding that the claim against
[Appellant] was not valid?
c. For the purposes of [Appellant’s] contractual
indemnification claim against Atlantic Concrete, did
the Trial Court err in evaluating the validity of plaintiff
Kimberly Bolden-Johnson’s claim against [Appellant]
at the time of Atlantic Concrete’s motion for
compulsory nonsuit, rather than at the time of
[Appellant’s] settlement with plaintiff?
2. Did the Trial Court err in determining that statements made in
[Appellant’s] motion for summary judgment were judicial
admissions warranting entry of compulsory nonsuit?
3. Did the Trial Court act in contravention to Pennsylvania public
policy of encouraging the settlement of lawsuits when it
granted Atlantic Concrete’s motion for compulsory nonsuit?
Appellant’s Brief at 4-5.
Preliminarily, we note Appellant’s noncompliance with Pa.R.A.P.
2119(a), which requires the argument section of an appellate brief to
be divided into as many parts as there are questions to be
argued; and shall have at the head of each part - in distinctive
type … - the particular point treated therein, followed by such
discussion and citation of authorities as are deemed pertinent.
- 12 -
J-A21019-22
Id. (emphasis added). Appellant’s argument section headings do not
correspond to its issues. Although this defect has complicated our review, we
address the merits of Appellant’s issues as presented. See Pa.R.A.P. 105(a)
(requiring liberal construction of appellate rules); but see Commonwealth
v. Briggs, 12 A.3d 291, 343 (Pa. 2011) (“The briefing requirements
scrupulously delineated in our appellate rules are not mere trifling matters of
stylistic preference; rather, they represent a studied determination by our
Court and its rules committee of the most efficacious manner by which
appellate review may be conducted[.]”).
Appellant’s first issue (and related sub-issues) challenges the trial
court’s entry of nonsuit in favor of Atlantic. See Appellant’s Brief at 33-60;
see also Appellant’s Reply Brief at 33 (Appellant clarifying its “central
contention” is whether “the trial court erred in granting nonsuit for Atlantic
Concrete, as the trial court incorrectly ruled that plaintiff did not have a valid
claim against [Appellant].” (some capitalization omitted)). Pursuant to
Pa.R.C.P. 230.1(a)(1), a court may enter a nonsuit “if, at the close of the
[non-moving party’s] case on liability, the [non-moving party] has failed to
establish a right to relief.” Id.We recognize our standard of review:
Nonsuit should not be granted unless it is clear that the [non-
moving party] has not established a cause of action or any right
to relief against the party in question. When we determine if the
[non-moving party] has established the right to recover, the [non-
moving party] must be allowed the benefit of all favorable
evidence and reasonable inferences arising therefrom, and any
- 13 -
J-A21019-22
conflicts in the evidence must be resolved in favor of the [non-
moving party]. This Court will reverse an order refusing to
remove a nonsuit if the trial court either abused its discretion or
committed an error of law.
Scampone v. Grane Healthcare Co., 169 A.3d 600, 611 (Pa. Super. 2017)
(citations and quotations omitted); see also MB Fin. Bank v. Rao, 201 A.3d
784, 788 (Pa. Super. 2018) (“When a nonsuit is entered, the lack of evidence
to sustain the action must be so clear that it admits no room for fair and
reasonable disagreement.” (citation omitted)). “An abuse of discretion may
not be found merely because an appellate court might have reached a different
conclusion, but requires a manifest unreasonableness, or partiality, prejudice,
bias, or ill-will, or such lack of support so as to be clearly erroneous.” Parr v.
Ford Motor Co., 109 A.3d 682, 690 (Pa. Super. 2014) (en banc) (citations
omitted); see also Fancsali v. Univ. Health Ctr., 761 A.2d 1159, 1162 (Pa.
2000) (“When the trial court reaches a conclusion calling for the exercise of
its discretion, the party complaining on appeal has a heavy burden.”).
We first address Appellant’s claim, in connection with its first issue, that,
“the trial court should have applied New Jersey law to the claim for
indemnification as required by the parties’ contract.” Appellant’s Brief at 39;
see also id. at 40 (citing above choice of law provision – Subcontract,
11/25/15, ¶ 26.9). Appellant asserts,
the Trial Court erred by trying to evaluate [Appellant’s] actual
liability following [Appellant’s] case-in-chief at the bench trial.
New Jersey law does not require that the Trial Court reach a
decision on the merits in order to evaluate [Appellant’s] potential
liability in the context of a claim for contractual indemnification.
- 14 -
J-A21019-22
[Appellant] need only show that it “faced potential liability” for
the claims underlying the settlement.
Id. at 49 (emphasis added; footnote omitted) (quoting Serpa v. New Jersey
Transit, 951 A.2d 208, 213 (N.J. App. Div. 2008) (A party may be indemnified
for settlement payments it makes where three requirements are met: “(a)
the indemnitee’s claims are based on a valid, pre-existing
indemnitor/indemnitee relationship; (b) the indemnitee faced potential
liability for the claims underlying the settlement; and (c) the settlement
amount was reasonable.”) (emphasis added; citation omitted)); but cf.
Burlington Coat Factory, 126 A.3d at 1022 (to establish an indemnification
claim in Pennsylvania, a settling party has the burden of proving, inter alia,
the “validity of the underlying claim”).
Atlantic counters that Appellant waived this claim, stating:
The only aspect of New Jersey law [Appellant] specifically
discusses is an alleged “potential liability” standard, which
(according to [Appellant]) the trial court should have applied
instead of Pennsylvania’s “valid claim” standard. … [Appellant]
waived any argument that New Jersey law applies to the statutory
employer analysis[.]
Atlantic’s Brief at 34 (footnote and citation omitted). Atlantic contends that
because Appellant
never referenced New Jersey law in responding to Atlantic’s
nonsuit motion based on statutory employer immunity, and
certainly never raised the alleged “potential liability” standard at
any time during trial, its current argument is clearly waived. See
Pa.R.C.P. 227.1(b)(1) [(providing in relevant part, “post-trial
relief may not be granted unless the grounds therefor … were
raised in pre-trial proceedings or by motion, objection, point for
charge, request for findings of fact or conclusions of law, offer of
- 15 -
J-A21019-22
proof or other appropriate method at trial”)]; Young [v. S. B.
Conrad, Inc.], 216 A.3d [267], 274-275 [(Pa. Super. 2019)]
(finding waiver because plaintiff “did not bring his claims of
procedural error to the [trial] court’s attention until after he had
lost the [nonsuit] motion.”) [(emphasis in Young).]
Atlantic’s Brief at 36.
Consistent with this argument, the trial court found waiver. See Trial
Court Opinion, 12/16/21, at 10 (citing Pa.R.C.P. 227.1(b)(1), supra and
noting Appellant “did not raise the choice of law issue when Atlantic moved
for a nonsuit. In fact, [Appellant] cited Pennsylvania law to support its
position[.]” (citations omitted)); see also id. (“the [c]ourt did not err in
applying Pennsylvania law because it decided Atlantic’s nonsuit on [] statutory
employer grounds,” and observing, “[p]er [Appellant’s] own admission,
Pennsylvania law governed the statutory employer issue.” (citing Motion for
Summary Judgment, 9/3/19, at ¶¶ 20-78)). Upon review, we agree. See,
e.g., Trigg v. Children’s Hosp. of Pittsburgh, 229 A.3d 260, 269 (Pa.
2020) (“[I]t is axiomatic that issues not raised in lower courts are waived for
purposes of appellate review, and they cannot be raised for the first time on
appeal. Pa.R.A.P. 302(a). … Requiring issues to be properly raised first in
the trial court ensures that trial judges have the opportunity to consider a
potential appellate issue and correct any error at the first available
opportunity.” (some citations omitted)).
Appellant further argues, in connection with its first issue, that the trial
court improperly failed to hold that an express provision of the Subcontract
- 16 -
J-A21019-22
“preclude[s] the statutory employer defense as a bar to [Appellant’s] recovery
for contractual indemnification[.]” Appellant’s Brief at 35 (bold and some
capitalization omitted). Appellant references Article 8.1, which provides,
“[Atlantic’s] indemnity obligations under this paragraph shall not be limited by
applicable worker’s compensation acts….” Subcontract, 11/25/15, at ¶ 8.1;
see also Appellant’s Brief at 35. However, Appellant also waived this claim
for failing to raise it before the trial court. Pa.R.A.P. 302(a); Pa.R.C.P.
227.1(b)(1); Young, supra; see also U.S. Bank, N.A. v. Hua, 193 A.3d
994, 997 (Pa. Super. 2018) (where appellant failed to raise claim in court-
ordered Pa.R.A.P. 1925(b) statement, omission “will result in automatic
waiver of the issues raised.” (emphasis in original; citation omitted));
Pa.R.A.P. 1925(b)(4)(vii).
Next, we simultaneously address Appellant’s remaining, preserved
claims in its first issue, with the related claims in Appellant’s second issue.
Appellant argues the trial court improperly entered nonsuit against Appellant,
where the court,
should have evaluated plaintiff’s claims against [Appellant] in the
context of the underlying matter where, in rejecting
[Appellant’s] statutory employer defense at the summary
judgment stage, the Trial Court confirmed [Appellant]
could be held liable for plaintiff’s claims. … When a party is
seeking contractual indemnification to recover a settlement in the
underlying matter, the Trial Court should not determine whether
actual liability exists at the time of trial on the indemnification
claim. Instead, the evaluation of the potential liability of
[Appellant] or the validity of plaintiff’s claim against [Appellant]
should have been applied to the time [Appellant’s] claim for
contractual indemnification arose – when plaintiff settled its claim
- 17 -
J-A21019-22
against [Appellant], after summary judgment on the statutory
employer defense was denied by the same judge.
Appellant’s Brief at 31 (emphasis added). Appellant maintains, “in the context
of a claim for contractual indemnification, … [no] Pennsylvania case instructs
the lower courts when they should evaluate the validity of plaintiff’s claim
against the party seeking indemnity.” Id. at 53 (emphasis in original).
Appellant further argues the trial court abused its discretion in finding
that plaintiff’s claim against Appellant was not valid. See id. at 51-56; see
also Burlington Coat Factory, 126 A.3d at 1022 (discussing “valid claim”
requirement to establish an indemnification claim after a settlement
payment). Referencing the trial court’s denial of its motion for summary
judgment, Appellant contends,
determining that a claim is valid enough to submit it to a
jury is enough to create a “valid claim” by plaintiff against
[Appellant], for purposes of contractual indemnity. After
[Appellant’s] motion for summary judgment was denied in
October 2019, no new evidence was introduced on the issue of
[Appellant’s] status as ? statutory employer at the bench trial.
Id. at 54-55 (emphasis added); see also id. at 55 (“The same material issues
of fact on the factual issues presented in a statutory employer defense that
were identified by the Trial Court[, i.e., in denying Appellant’s summary
judgment motion,] remained in existence when [Appellant] and plaintiff
settled their claim.” (quotations omitted)). Appellant emphasizes the
Subcontract’s inclusion of the indemnity provision, and contends,
Atlantic Concrete promised to indemnify [Appellant] for “all”
claims arising from or relating to Atlantic Concrete’s work. Under
- 18 -
J-A21019-22
the Trial Court’s decision, however, Atlantic Concrete has to
indemnify [Appellant] only when a plaintiff’s claim against
[Appellant] is “valid.” That is a sweeping, improper judicial
rewrite of the parties’ agreement.
Id. at 59.
In its second issue, Appellant argues the trial court “erred in concluding
that statements made by [Appellant] in its motion for summary judgment
were judicial admissions warranting entry of compulsory nonsuit[.]” Id. at 60
(bold and some capitalization omitted).6 Appellant contends:
It cannot be said that [Appellant’s] statements in its motion for
summary judgment were unequivocally admitted or conclusively
binding where the statements were genuinely disputed by plaintiff
and viewed with such uncertainty by the Trial Court that it denied
[Appellant’s] motion for summary judgment.
Id. at 63. Appellant complains, “it was unfair for the trial court to reject
[Appellant’s] statements when contained in a motion for summary judgment
…, only to reverse itself when considering a motion for compulsory nonsuit….”
Id. at 61 (some capitalization omitted).
Atlantic, on the other hand, argues:
[I]ndemnification language does not impose absolute liability and
is not self-effectuating; its application in a particular case must be
proven by the indemnitee as the moving party. And, when the
indemnitee settles the underlying claim, which precludes fact-
finding that is necessary to determine whether the indemnification
language applies, decades of Pennsylvania law impose an elevated
burden of proof on the indemnitee. In this Court’s leading decision
on the subject, it explained:
____________________________________________
6The trial court did not address this claim in its Pa.R.A.P. 1925(a) opinion.
But see Appellant’s Rule 1925(b) Statement, 11/8/21, ¶ 9 (preserving claim).
- 19 -
J-A21019-22
[W]hen a cause is settled, the record of the action is not
sufficient to establish an indemnitee’s claim against the
indemnitor and the indemnitor is entitled to a trial by jury
and a determination by it as to whether or not liability
did, in fact, exist …. The fact of voluntary payment
does not negat[e] the right to indemnity. It merely
varies the degree of proof needed to establish the
liability of the indemnitor.
Martinique Shoes v. New York Progressive Wood Heel Co.,
217 A.2d 781, []783 (Pa. Super. 1966) (emphasis added; citations
omitted).
[Appellant] never addresses or even acknowledges that its
decision to settle fundamentally altered its burden of proof and
required it to establish that the settled claim was valid — i.e., that
its liability “did, in fact, exist.” Id. [Appellant’s] statutory
employer immunity, which it no longer disputes, is not merely a
“defense,” as [Appellant] claims. It is a nonwaivable abrogation
of tort liability, which deprives courts of subject matter jurisdiction
and renders them incompetent to even consider tort claims.
Sheard v. J.J. DeLuca, 92 A.3d 68, 75-78 (Pa. Super. 2014).
Thus, plaintiff’s underlying claim against [Appellant] was not valid,
liability did not in fact exist, and indemnification would be
improper as a matter of law. See Fox Park Corp. v. James
Leasing Corp., 641 A.2d 315, 317 (Pa. Super. 1994) (“Fox need
not indemnify Robinson’s settlement payments if Robinson was
never liable to anyone in the first place.”).
[Further], the denial of summary judgment did not, as
[Appellant] claims, “reject” statutory employer immunity or
“establish” the validity of Plaintiff’s claim. Brief for Appellant, p.
54. As the trial court found, [Appellant’s] argument
misapprehends the import of a summary judgment denial, [see
Trial Court Opinion, 12/16/21, at 13, supra,] which does not
accept, reject, or establish any legal position, but simply allows
claims and defenses to proceed to trial.
Atlantic’s Brief at 2-3. Atlantic also argues, contrary to Appellant’s assertion
that the trial court should have evaluated the “validity” of plaintiff’s claims
- 20 -
J-A21019-22
after the denial of Appellant’s summary judgment motion, that Pennsylvania
Rule of Civil Procedure 230.1,
clearly states that the relevant time for considering a nonsuit
motion is “at the close of the plaintiff’s case on liability,” and the
relevant record to consider is the trial record, not the summary
judgment record. See Pa.R.Civ.P. 230.1(a)(1); and id., (a)(2)
(stating that the court “shall consider only evidence which was
introduced by the plaintiff”) (emphasis added).
Indeed, this Court has specifically rejected the argument
that the summary judgment evidentiary record is relevant in
evaluating a nonsuit. See Barnes v. Alcoa, Inc., 145 A.3d 730,
737-738 (Pa. Super. 2016) (“[a]ppellants rely upon evidence
presented at the summary judgment stage …. We are prohibited
from considering evidence not presented at trial when considering
whether the trial court properly granted [a] nonsuit motion. Thus,
[a]ppellants’ reliance upon this evidence is misplaced.”).
Atlantic’s Brief at 42-43.
After careful review, we agree with Atlantic’s arguments, which are
supported by the record and the law. The trial court properly concluded that
the evidence presented at trial satisfied each of the aforementioned
McDonald elements for statutory employer immunity. See Trial Court
Opinion, 12/16/21, at 11 (“After the end of [Appellant’s] case-in-chief,
the record contained uncontested evidence that [Appellant] met all five
elements of the McDonald test.” (emphasis added)). We discern no error or
abuse of the trial court’s discretion in concluding Ms. Bolden-Johnson had a
“valid claim” against Appellant. See Burlington Coat Factory, supra; Trial
Court Opinion, 12/16/21, at 11-12. Indeed, as Atlantic correctly points out,
this Court has emphasized that a party entering into a settlement “assumes
- 21 -
J-A21019-22
the risk, in an action against the wrongdoer for indemnity, of being
able to prove the actionable facts on which his liability depends….”
Martinique Shoes, 217 A.2d at 783 (emphasis in original; citation omitted);
see also Atlantic’s Brief at 21, and id. at 22 (arguing, “contrary to
[Appellant’s] claim, contractual indemnification language is insufficient
standing alone to permit recovery after a settlement”). The trial court did not
improperly consider all evidence of record, including Appellant’s admissions in
its summary judgment motion. See Cogley, supra (judicial admissions are
binding).
The record also refutes Appellant’s claim that the record after the non-
jury trial, contained “no new evidence” for the court to consider in ruling on
the nonsuit motion and issue of statutory employer liability. Appellant’s Brief
at 55; see also Trial Court Opinion, 12/16/21, at 3-4, 11-13, supra (detailing
new evidence presented at trial); Atlantic’s Brief at 46-49 (same).
Accordingly, the trial court properly entered nonsuit against Appellant on its
contractual immunity claim. See Pa.R.C.P. 230.1(a)(1); Fox Park, 641 A.2d
at 317, 318 (upholding trial court’s denial of appellant/alleged indemnitee’s
motion for indemnification made after a settlement payment, where appellant
“was never liable to anyone in the first place.”). Appellant’s first and second
issues do not merit relief.
In its final issue, Appellant asks us to reverse the trial court’s entry of
nonsuit, as it “will discourage settlements,” in contravention of Pennsylvania’s
- 22 -
J-A21019-22
public policy of encouraging settlements. Appellant’s Brief at 64 (bold and
some capitalization omitted) (citing Nationwide Ins. Co. v. Schneider, 960
A.2d 442, 449 (Pa. 2008) (“it remains a strong, prevailing public policy in
Pennsylvania to encourage voluntary settlements.”)). Appellant complains the
trial court’s ruling,
will significantly discourage future settlements where
indemnification agreements are at issue. Any defendant or
insurer looking at the result in this case would have to conclude
that the safest and most fiscally responsible thing to do is to not
settle with plaintiff and, instead, take its defenses to trial. … If
the defendant’s defenses are rejected at trial, the defendant would
have established there was a valid claim against it that had
matured into a judgment, and it could rest easily knowing that it
could pursue its contractual indemnification claim against its
subcontractor.
Appellant’s Brief at 66 (emphasis in original).7
Atlantic counters:
[Appellant’s] argument misapprehends numerous key facts and
suggests that the onerous situation created by [Appellant] should
result in sympathy for [Appellant]. … [The trial court’s] denial of
summary judgment did not “reject” [Appellant’s] statutory
employer immunity or “establish” the validity of Plaintiff’s claims
in any way. It simply found that a trial was necessary. Then,
more than eighteen months later, the nonsuit was granted based
on extensive new evidence that [Appellant] itself presented at
trial. There was nothing improper about this, and there is no basis
for [Appellant’s] suggestion that the nonsuit could discourage
settlements.
Atlantic’s Brief at 54 (emphasis in original).
____________________________________________
7 Again, the trial court did not address this claim in its Pa.R.A.P. 1925(a)
opinion. But see Appellant’s Rule 1925(b) Statement, 11/8/21, ¶ 15
(preserving public policy claim).
- 23 -
J-A21019-22
Again, we are persuaded by Atlantic’s arguments, and our review
reveals no authority to support Appellant’s claim that the trial court’s ruling
contravenes Pennsylvania’s public policy of encouraging settlements. See,
e.g., Martinique Shoes, 217 A.2d at 783 (a settling party “assumes the risk”
of possible unfavorable implications in a subsequent “action against the
wrongdoer for indemnity”); see also Trial Court Opinion, 12/16/21, at 13
(stating Appellant “misapprehends the import” of the court’s denial of
Appellant’s motion for summary judgment). Appellant’s third issue does not
merit relief.
Based on the foregoing, the trial court did not err or abuse its discretion
in entering nonsuit against Appellant. Accordingly, we affirm.
Judgment affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 9/30/2022
- 24 -