Premium Mngt., LLC v. Tobacco Outlet Minimart

J-S08031-23
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT OP 65.37
PREMIUM MANAGEMENT, LLC : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
TOBACCO OUTLET MINIMART 1, INC. :
D/B/A UNI-MART :
: No. 1163 MDA 2022
Appellant :
Appeal from the Judgment Entered September 13, 2022
In the Court of Common Pleas of Lycoming County Civil Division at
No(s): CV-2020-00854-CV
BEFORE: OLSON, J., McCAFFERY, J., and COLINS, J.*
MEMORANDUM BY COLINS, J.: FILED: JUNE 1, 2023
Appellant, Tobacco Outlet Minimart 1, Inc. d/b/a Uni-Mart (Defendant),
appeals from a judgment entered against it following a nonjury trial in a
breach of contract action brought by Premium Management, LLC (Plaintiff).
For the reasons set forth below, we affirm.
On August 26, 2020, Plaintiff filed this action against FN Mart, Inc. d/b/a
Uni-Mart (FN) and Mantu Sah, the owner and president of Defendant. Plaintiff
filed an amended complaint against FN, Sah, and Defendant on November 2,
2020, and FN and Sah were subsequently dismissed as defendants on a joint
motion of Plaintiff and Defendant.
____________________________________________
* Retired Senior Judge assigned to the Superior Court.
J-S08031-23
In its amended complaint, Plaintiff alleged that it and Defendant signed
a written contract on March 16, 2019 for placement of electronic skill games
in Defendant’s Uni-Mart store in McSherrystown, Pennsylvania for a period of
three years, with revenues from the games to be divided between Plaintiff and
Defendant. Amended Complaint ¶¶6-12.1 This contract provided that in the
event of a breach by Defendant, Plaintiff would be entitled to recover as
liquidated damages its share of average weekly revenues from the games
multiplied by the number of remaining weeks of the contract’s three-year term
and its costs and attorney fees in any action to enforce the contract. Id. ¶¶18,
21. Plaintiff alleged that from March 16, 2019 to June 4, 2020, Defendant had
Plaintiff’s games at its Uni-Mart store and Plaintiff and Defendant divided the
revenue from the games in accordance with the contract, but that Defendant
removed the games from its store on June 4, 2020 and replaced them with
coin-operated machines supplied by persons other than Plaintiff. Id. ¶¶13-
16. Plaintiff alleged that the removal of its games before the expiration of the
contract’s three-year term was a breach of the contract and sought the
liquidated damages, costs, and attorney fees provided by the contract. Id.
¶¶17-19, 23-24.
____________________________________________
1 Although Defendant’s store was not in Lycoming County, the action was
brought in Lycoming County because the contract had a forum selection clause
providing that the Court of Common Pleas of Lycoming County had exclusive
jurisdiction over any claims or lawsuits regarding the contract. 3/16/19
Contract ¶12(e); N.T. Trial at 11.
-2-
J-S08031-23
Defendant, represented by counsel, filed an answer and new matter in
which it admitted that it entered into a contract with Plaintiff on March 16,
2019 under which it agreed to place Plaintiff’s electronic skill games in its Uni-
Mart store in exchange for receiving 60% of the revenues from the games,
with Plaintiff to receive 40% of the revenues. Answer and New Matter ¶¶6-7.
Defendant admitted in this answer that it removed the games, but alleged
that it did so because Plaintiff breached the contract by unilaterally attempting
to change the revenue split to 50-50. Id. ¶¶6, 13-16. Neither party
demanded a jury trial.
The trial court entered a scheduling order requiring completion of
discovery by May 11, 2021, scheduling the final pretrial conference for
December 6, 2021, and ordering that the case would be tried in the January-
February 2022 trial term. Trial Court Order, 2/1/21. On November 12, 2021,
counsel for Defendant moved to withdraw on the ground that Defendant was
not paying his fees, and the court granted counsel’s motion to withdraw on
December 6, 2021. Motion to Withdraw as Counsel; Trial Court Order,
12/6/21. On December 20, 2021, the trial court entered a scheduling order
setting the trial date for February 7, 2022. Trial Court Order, 12/20/21.
The case was tried to the court without a jury on February 7, 2022.
Defendant did not retain new counsel before the case came to trial and the
only individual who appeared for or on behalf of Defendant at trial was Sah.
N.T. Trial at 3-6. Although neither Sah nor Defendant had requested an
-3-
J-S08031-23
interpreter in advance of trial, because Sah’s native language was Hindi and
he expressed some difficulty fully understanding English, the trial court
obtained a Hindi interpreter who connected to the proceedings by telephone
and translated the proceedings and Sah’s questions and answers for him. Id.
at 8-17. Plaintiff called two witnesses, its representative who negotiated and
signed the written contract and Sah, who signed the written contract on behalf
of Defendant. Id. at 22-60. The trial court permitted Sah to cross-examine
Plaintiff’s representative and to testify himself. Id. at 46-54, 61-65, 70-71,
74-77. Following the testimony, the trial court entered a verdict in favor of
Plaintiff and against Defendant in the amount of $88,847.37, consisting of
$73,807.32 in liquidated damages, $13,455.00 in attorney fees, and
$1,585.05 in costs. Id. at 77, 79; Trial Court Order, 2/7/22.
On February 17, 2022, Defendant, represented by new counsel that it
retained after the trial, filed a timely motion for post-trial relief in which it
asserted, inter alia, 1) that the trial court erred in finding that there was a
valid contract because the evidence was insufficient to show that there was a
meeting of the minds and 2) that the trial court erred in proceeding with the
trial when Defendant was not represented by counsel because a corporation
can appear in court only through an attorney. On July 22, 2022, the trial court
denied Defendant’s motion for post-trial relief. Trial Court Opinion and Order,
7/22/22. Judgment was entered on September 13, 2022 in favor of Plaintiff
-4-
J-S08031-23
and against Defendant in the amount of $88,847.37. Defendant, represented
by a third, different lawyer, timely appealed from this judgment.2
In this appeal, Defendant raises two issues for our review: 1) whether
it is entitled to a new trial because it was represented at trial only by Sah, an
officer of the corporation who is not an attorney; and 2) whether it is entitled
to judgment in its favor because there was no meeting of the minds and
therefore was no valid contract between Plaintiff and Defendant. Appellant’s
Brief at 8. Neither of these issues merits relief.
We review Defendant’s first claim under the following standard:
We will reverse a trial court’s decision to deny a motion for a new
trial only if the trial court abused its discretion. We must review
the court’s alleged mistake and determine whether the court erred
and, if so, whether the error resulted in prejudice necessitating a
new trial.
Barrett v. M&B Medical Billing, Inc., 291 A.3d 371, 375 (Pa. Super. 2022)
(quoting Carlini v. Glenn O. Hawbaker, Inc., 219 A.3d 629 (Pa. Super.
2019)). This claim fails because the error of which Defendant complains as a
matter of law does not constitute a ground for relief for a party in Defendant’s
position and did not prejudice it.
____________________________________________
2 Appellant filed its appeal prematurely on August 22, 2022, before any
judgment had been entered. Because judgment was entered on September
13, 2022, Appellants’ appeal is timely and is properly before us. 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”); Barrett v. M&B Medical Billing, Inc., 291
A.3d 371, 374 n.3 (Pa. Super. 2022).
-5-
J-S08031-23
Defendant is correct that a corporation generally cannot appear in court
pro se or be represented by a non-lawyer officer or representative. Phoenix
Mutual Life Insurance Co. v. Radcliffe on the Delaware, Inc., 266 A.2d
698, 701 (Pa. 1970); Barrett, 291 A.3d at 376; Walacavage v. Excell 2000,
Inc., 480 A.2d 281, 284-85 (Pa. Super. 1984). Filings on behalf of a
corporation by a non-lawyer representative may therefore properly be
stricken. Walacavage, 480 A.2d at 283-84. In addition, where a corporation
appeared without counsel and a non-lawyer represented the corporation at a
trial or hearing, the opposing party may challenge the judgment. Barrett,
291 A.3d at 377-78 (plaintiff entitled to new trial where non-lawyer
representative of defendant corporation cross-examined plaintiff and raised
issues at trial on behalf of corporation).
The rule that a corporation cannot be represented by a non-lawyer,
however, does not provide grounds for a corporation to set aside an adverse
civil judgment from a trial where it chose to appear without counsel. Phoenix
Mutual Life Insurance Co., 266 A.2d at 701-02. In Phoenix Mutual Life
Insurance Co., a corporation was represented at the trial of a mortgage
foreclosure action by a non-lawyer officer who was one of its three
stockholders, after its prior counsel had been permitted to withdraw
approximately two months earlier for non-payment of fees and the corporation
had not retained new counsel before the trial. Id. at 699-700. Our Supreme
Court held that under those circumstances, the corporation was not entitled
-6-
J-S08031-23
to relief from the judgment against it. Id. at 701-02. The Court ruled that
although a corporation can usually only be represented by a lawyer,
proceeding with trial despite the defendant corporation’s lack of legal
representation was proper because the corporation had sufficient time to
retain counsel and that the corporation therefore “will not be permitted to
complain that the court erred in permitting [the non-lawyer officer] to provide
it with some representation.” Id. The Court noted that permitting the
corporation to defer trial and challenge the judgment on this basis would mean
that a corporation that fails to pay its obligations could “avoid or postpone a
[judgment against it] by failing to pay its lawyers.” Id. at 701.
That is the situation here. This case is a civil case for breach of contract
in which Plaintiff sought a money judgment against Defendant. Defendant
was not represented by counsel at trial because its counsel had been permitted
to withdraw as a result of Defendant’s failure to pay for his services.
Defendant had two months to retain new counsel between December 6, 2021,
when counsel was permitted to withdraw, and the February 7, 2022 trial. No
new counsel, however, had entered any appearance for Defendant as of the
date of trial, and there is nothing in the record indicating that Defendant made
any effort before trial to hire any attorney other than the attorney who had
withdrawn from the case. N.T. Trial at 4-6. Defendant, having failed to retain
counsel despite adequate opportunity to do so, therefore cannot seek relief on
-7-
J-S08031-23
the ground that it was represented by a non-lawyer at the trial. Phoenix
Mutual Life Insurance Co., 266 A.2d at 702.
In any event, Defendant has not shown that permitting its non-lawyer
officer Sah to represent it at trial caused it prejudice. Because Defendant had
already had adequate time to obtain counsel and failed to do so, enforcement
of the requirement that a corporation can be represented only by an attorney
would not have provided Defendant with any legal representation at the trial
or additional delay to obtain counsel. Instead, enforcement of this rule would
have only resulted in precluding Defendant from cross-examining Plaintiff’s
representative, challenging Plaintiff’s case, and presenting its own case.
Barrett, 291 A.3d at 378; Walacavage, 480 A.2d at 283.
Defendant does not point to anything in Sah’s representation that
brought out evidence adverse to it. The evidence from Sah and Defendant
that supported the trial court’s verdict was in Sah’s direct testimony as a
witness called by Plaintiff and an admission from Defendant’s answer, when it
was represented by counsel, that was introduced by Plaintiff. N.T. Trial at 57-
61. That evidence would have come in even if Sah did not represent
Defendant at trial. Rather, Defendant argues only that Sah did not examine
witnesses or present Defendant’s case as well as an attorney would have.
Appellant’s Brief at 15-16. Because enforcement of the requirement that only
an attorney could represent Defendant would have prevented Defendant from
participating in the trial altogether, rather than resulting in representation by
-8-
J-S08031-23
counsel, and Defendant has not shown that Sah’s representation made its
case worse than it would have been with no participation by Defendant as an
entity at all, the trial court correctly concluded that Defendant was not
prejudiced by its decision to permit Sah to represent it. See Trial Court
Opinion and Order, 7/22/22, at 2; Trial Court Opinion, 10/14/22, at 6-7.
Defendant’s remaining claim asserts that the evidence was insufficient
to support the trial court’s breach of contract verdict against it.
Our appellate role in cases arising from non-jury trial verdicts is
to determine whether the findings of the trial court are supported
by competent evidence and whether the trial court committed
error in any application of the law. The findings of fact of the trial
judge must be given the same weight and effect on appeal as the
verdict of a jury. We consider the evidence in a light most
favorable to the verdict winner. We will reverse the trial court only
if its findings of fact are not supported by competent evidence in
the record or if its findings are premised on an error of law.
Barrett, 291 A.3d at 375 (quoting Bank of New York Mellon v. Bach, 159
A.3d 16 (Pa. Super. 2017)).
To obtain a judgment for breach of contract, Plaintiff was required to
prove the following elements: (1) the existence of a contract, including its
essential terms, (2) that the defendant breached a duty imposed by the
contract, and (3) resultant damages. McCausland v. Wagner, 78 A.3d
1093, 1101 (Pa. Super. 2013); Hart v. Arnold, 884 A.2d 316, 332 (Pa. Super.
2005). The only element of breach of contract that Defendant claims that the
evidence does not support is the existence of the contract and its terms.
-9-
J-S08031-23
Defendant’s claim that Plaintiff did not prove the contract between it and
Plaintiff and the terms of that contract is without merit. At trial, Plaintiff
introduced evidence that Defendant agreed to a contract on March 16, 2019,
under which Plaintiff’s games were placed in its store for three years in
exchange for 60% of the revenues from the games, with Plaintiff to receive
40% of the revenues, and that the contract provided for liquidated damages
consisting of Plaintiff’s share of average weekly revenues multiplied by the
number of weeks remaining in the contract term in the event that Defendant
removed the Plaintiff’s games from the store during the contract term and also
provided for attorney fees. N.T. Trial at 23-35, 38-39, 57-58; 3/16/19
Contract. The trial court found this testimony credible. Trial Court Opinion,
10/14/22, at 3-4.
Defendant argues that agreement on the terms of the contract was not
proven because there were two contract documents, the March 16, 2019
contract and an April 11, 2019 document, whose terms were not the same.
This claim fails, however, because the evidence at trial showed that the only
contract document to which Plaintiff and Defendant agreed was the March 16,
2019 contract. Plaintiff’s representative testified that both parties signed the
March 16, 2019 contract and that April 11, 2019 document was never signed
or agreed to by the parties. N.T. Trial at 26-29, 49-50. Sah testified that he
signed the March 16, 2019 contract and had authority to sign contracts for
Defendant, and Defendant in its answer to Plaintiff’s complaint admitted that
- 10 -
J-S08031-23
Sah signed the March 16, 2019 contract on its behalf and that Sah did not
sign the April 11, 2019 document. Id. at 57-58; Answer and New Matter ¶7.
For the foregoing reasons, we conclude that neither of Defendant’s
claims of error merit relief. Accordingly, affirm the trial court’s judgment in
favor of Plaintiff.
Judgment affirmed.
Judge McCaffery joins the memorandum.
Judge Olson concurs in the result.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 6/01/2023
- 11 -