Bell, R. v. Bell, H. & Kirk, J.

J-S29019-23
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT O.P. 65.37
RIAN BELL, INDIVIDUALLY, AND : IN THE SUPERIOR COURT OF
RIAN BELL, AS MEMBER AND ON : PENNSYLVANIA
BEHALF OF SIMPLY COUNTRY, LLC :
:
Appellant :
:
v. :
:
HOLLY BELL, JOSHUA KIRK, AND :
WILLOW AND WILDFIRE, LLC :
:
Appellees : No. 95 MDA 2023
Appeal from the Order Entered December 30, 2022
In the Court of Common Pleas of Perry County
Civil Division at No(s): CV-CV-2021-0295
BEFORE: MURRAY, J., KING, J., and COLINS, J.*
MEMORANDUM BY KING, J.: FILED: AUGUST 29, 2023
Appellant, Rian Bell, individually and as member and on behalf of Simply
Country, LLC, appeals from the order entered in the Perry County Court of
Common Pleas, which sustained the preliminary objections of Appellee, Holly
Bell, and dismissed Appellant’s complaint without prejudice. We reverse and
remand for further proceedings.
The relevant facts and procedural history of this case are as follows.
Appellant Rian Bell and Appellee Holly Bell are married and in the midst of
contentious divorce proceedings. Appellant and Appellee Bell each own 50%
of Simply Country, LLC (“Simply Country”). Appellee Bell subsequently began
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* Retired Senior Judge assigned to the Superior Court.
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dating Appellee Joshua Kirk, and the two formed Appellee Willow and Wildfire,
LLC (“W&W”).
[Appellant] filed a Complaint and Petition for Preliminary
Injunction in this matter against [Appellees] on May 5,
2021.[1] [Appellant] asserts in his Complaint, that
[Appellees] breached a fiduciary duty that they had with
both himself and with Simply Country, and that he has
suffered damages as a result of these breaches.
[Appellant’s] complaint also asserts that [Appellees] stole
property from Simply Country, tortiously interfered with
contracts, and knowingly gave false statements or refused
[to] disclose business records, causing him to suffer
financial damages. [Appellee] Bell, promptly filed
Preliminary Objections to the Complaint, and [Appellant]
amended the Complaint. [Appellee] Bell filed Preliminary
Objections to [Appellant’s] Amended Complaint on July
1[9], 2021, and [Appellant] filed a Second Amended
[C]omplaint on or about August [4], 2021. [Appellee] Bell
filed Preliminary Objections to [Appellant’s] Second
Amended Complaint, on September 7, 2021.
[Appellee] Bell asserts in her Preliminary Objections that the
claims made in [Appellant’s] Complaint are based on
matters that are solely [within] the province of equitable
distribution of the couples’ property that is being handled as
part of the parties’ separate divorce action. [Appellee] Bell
further argues that these claims should be dismissed until
the marital assets have been divided through equitable
distribution, as Simply Country and both parties’ equity in
Simply County are marital assets and it would be impossible
to determine whether [Appellant] suffered any damages at
this time. [Appellee] Bell states, [Appellant’s] damages are
only speculative at this time and therefore he does not have
a cause of action.
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1 Regarding the request for a preliminary injunction, the court initially issued
a temporary injunction and held a hearing on June 17, 2021. Thereafter, the
court entered an order permitting Appellant to conduct an inventory of assets
and ordering Appellees to provide affidavits regarding inventory. The
temporary relief expired on July 1, 2021.
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(Opinion in Support of Order, filed 12/30/22, at 1-2; R.R. at 26-27).
The court held argument on Appellee Bell’s preliminary objections on
September 28, 2022, after which the court reserved making its decision. On
December 30, 2022, the court sustained the preliminary objections and
dismissed Appellant’s complaint “without prejudice.” (See Order, filed
12/30/22, at 1; R.R. at 20). In doing so, the court explained:
In this case, [Appellant] and [Appellee] Bell have a pending
divorce action. The Bells each own fifty-percent equity in
Simply Country[;] Simply Country and the equity that
[Appellant] and [Appellee] Bell each have in Simply Country
is a marital asset. This marital asset is subject to equitable
distribution, and until the marital property has been
distributed, [Appellant] does not have a cause of action.
The trial court has the power to account for any devaluation
of the company and the causes of that devaluation as part
of the equitable distribution of the couples’ property within
the pending divorce action. [Therefore, Appellant] cannot
assert that he has suffered any losses or damages until the
couples’ assets have been distributed as part of the divorce.
(Opinion in Support of Order at 2; R.R. at 27).
Appellant timely filed a notice of appeal on January 17, 2023. On
January 24, 2023, the court ordered Appellant to file a concise statement of
errors complained of on appeal per Pa.R.A.P. 1925(b). Appellant filed a Rule
1925(b) statement on February 16, 2023.2
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2 We note that Appellant’s Rule 1925(b) statement is an eleven (11) page
statement of errors to be raised on appeal, which reads much more like an
appellate brief. (See Rule 1925(b) Statement, filed 2/16/23, at unnumbered
pp. 1-11; R.R. at 4-14). Although we decline to find waiver here because the
trial court was able to adequately address Appellant’s claims in a responsive
(Footnote Continued Next Page)
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Appellant raises the following issues on appeal:
Did the trial court err when it dismissed the entire second
amended complaint containing sixteen (16) counts against
three (3) defendants, when the court held [Appellant] did
not have a cause of action until the company was distributed
by equitable distribution and that all issues were to be
entirely resolved as part of the equitable distribution of a
marital estate of [Appellant] and [Appellee Bell].
Did the trial court err when it dismissed the entire second
amended complaint when [Appellees] Joshua Kirk and
[W&W] did not raise preliminary objections to the six (6)
counts against those two (2) defendants.
(Appellant’s Brief at 5).
As a preliminary matter, Appellee Bell claims that the order before us is
not reviewable because it is not a final order, where the court dismissed
Appellant’s complaint “without prejudice.” (See Appellee Bell’s Brief at 1, 3,
5). “The appealability of an order directly implicates the jurisdiction of the
court asked to review the order.” In re Estate of Considine v. Wachovia
Bank, 966 A.2d 1148, 1151 (Pa.Super. 2009). As a result, “this Court has
the power to inquire at any time, sua sponte, whether an order is appealable.”
Id. Generally, “[a]n appeal may be taken from: (1) a final order or an order
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opinion, we caution counsel that the failure to present claims in a Rule 1925(b)
statement in a concise manner may result in waiver of the claims on appeal.
See generally Kanter v. Epstein, 866 A.2d 394 (Pa.Super. 2004), cert.
denied, 546 U.S. 1092, 126 S.Ct. 1048, 163 L.Ed.2d 858 (2006) (holding that
by raising outrageous number of issues in 15-page “concise” statements,
defendants deliberately circumvented meaning and purpose of Rule 1925(b)
and effectively precluded appellate review of issues they sought to raise on
appeal).
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certified as a final order (Pa.R.A.P. 341); (2) an interlocutory order as of right
(Pa.R.A.P. 311); (3) an interlocutory order by permission (Pa.R.A.P. 312,
1311, 42 Pa.C.S.A. § 702(b)); or (4) a collateral order (Pa.R.A.P. 313).” In
re Estate of Cella, 12 A.3d 374, 377 (Pa.Super. 2010) (some internal
citations omitted).
In support of her claim that we must quash this appeal, Appellee Bell
cites Mier v. Stewart, 683 A.2d 930 (Pa.Super. 1996). In that case, the
appellant filed a malpractice and breach of contract claim against his former
attorney. The trial court granted the appellee’s demurrer and dismissed the
malpractice count with prejudice. The court also dismissed the breach of
contract count, but did so “without prejudice,” giving the appellant additional
time to file a more specific amended complaint on that count. Rather than
filing an amended complaint, the appellant appealed. On appeal, this Court
noted that Rule 341 only permits an appeal from a final order. This Court
then explained that “[b]y granting a party leave to amend, the trial court has
not finally disposed of the parties or their claims. For finality to occur, the
trial court must dismiss with prejudice the complaint in full.” Id. at 930.
Accordingly, this Court quashed the appeal without prejudice to appeal once
a final order dismissing the breach of contract claim was entered on the
record. Id.On the other hand, Appellant relies on Pugar v. Greco, 483 Pa. 68, 394
A.2d 542 (1978), to support his proposition that the appeal is properly before
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us. In that case, our Supreme Court explained that “[i]n determining what
constitutes a final order…we look to ‘a practical rather than technical
construction’ of an order.” Id. at 73, 394 A.2d at 545 (internal citation
omitted). In other words, “if the practical consequence of the order by the
trial court is effectively to put an appellant ‘out of court’ the order will be
treated as final. Similarly, an order is ‘final’ if it precludes a party from
presenting the merits of his claim to the [trial] court.” Id. (internal citation
omitted).
Recently, in Rosenbaum and Associates, P.C. v. Scheff, No. 1604
EDA 2021, 2022 WL 15065527 (Pa.Super. filed Oct. 27, 2022) (unpublished
memorandum),3 appeal denied, ___ Pa. ___, 2023 WL 4879871 (Pa. filed Aug.
1, 2023), this Court considered the practical effect of an order that sustained
preliminary objections and dismissed a complaint without prejudice. In that
case, the appellants filed a complaint against the appellees on March 24, 2021,
asserting a claim for aiding and abetting a breach of fiduciary duty.
Thereafter, the appellees filed preliminary objections. Subsequently, the trial
court sustained the preliminary objections and dismissed the appellants’
complaint “without prejudice.” Id. at *4. In doing so, the trial court stated:
Since the alleged, threatened, aiding and abetting breach of
fiduciary duty has not yet occurred, [the a]pellants are not
presently able to allege that they sustained damages as a
result of [the a]pellees’ threatened conduct, rather than, or
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3 See Pa.R.A.P. 126(b) (stating we may rely on unpublished decisions of this
Court filed after May 1, 2019 for their persuasive value).
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in addition to, the conduct of [the a]ppellees’ clients, who
are the defendants in the related action.
Id. The court added that “if additional information revealed in discovery
shows that [the a]ppellees caused [the a]ppellants to suffer any harm other
than that caused by [the a]ppellees’ clients, then [the a]ppellants may file a
new complaint against [the a]ppellees.” Id. The appellants appealed.
On appeal, this Court initially addressed whether it had jurisdiction to
hear the appeal, where this Court acknowledged that “an order dismissing a
complaint without prejudice is generally considered interlocutory.” Id. at *6
(citing Mier, supra). Nevertheless, this Court explained that “because the
trial court did not grant [the a]ppellants leave to amend while dismissing their
complaint without prejudice, and instead directed that [the a]ppellants could
only file a new complaint if additional information comes to light, we will
consider the trial court’s order as final.” Id. (collecting cases which stand for
proposition of law that this Court will consider practical ramifications of order
when deciding whether order on appeal is “final”). Accordingly, this Court
proceeded to review the merits of the issues on appeal. See id. See also
Jones v. McGreevy, 270 A.3d 1, 11 n.12 (Pa.Super. 2022) (allowing appeal
to proceed on merits even though court sustained preliminary objections and
dismissed complaint “without prejudice” where court predicated appellant’s
ability to refile complaint on reversal of non-jury verdict in separate
garnishment action; court’s order effectively placed appellant “out of court”).
Instantly, the record makes clear that the court sustained Appellee Bell’s
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preliminary objections to the second amended complaint and dismissed the
complaint “without prejudice.” (See Order, filed 12/30/22, at 1; R.R. at 20).
Notwithstanding the court’s dismissal of Appellant’s complaint “without
prejudice,” the trial court essentially placed Appellant “out of court”
concerning the breach of fiduciary duty and related claims raised in the
complaint, unless and until Appellant prevailed in the equitable distribution
matter. (See Opinion in Support of Order at 2; R.R. at 27). Further, the
court’s dismissal order did not give Appellant an opportunity to amend the
complaint. Compare Mier, supra. Under these circumstances, we will treat
the order on appeal as final and proceed to our review of Appellant’s claims.
See Jones, supra; Rosenbaum, supra.
In his first issue, Appellant argues that to bar one action based on the
pendency of a prior action, the prior case must be the same, the parties must
be the same, and the relief requested must be the same. Appellant initially
asserts that the court should not have considered the separate divorce action
at all because Appellee Bell failed to attach a copy of the divorce complaint to
her preliminary objections. On this basis, Appellant contends that there was
no evidence presented regarding the case, parties, or relief requested in the
divorce action.
Moreover, Appellant maintains that the two parties to the divorce action
(Appellant and Appellee Bell) are not the same as the parties to the instant
action. Appellant complains that the divorce action is also different than the
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current case. Specifically, Appellant avers that the instant case is not simply
“a dispute over ownership of a business after the dissolution of a partnership,”
as suggested by the trial court, but “it is about seeking justice against the co-
conspirators who worked in concert to steal assets and potential profits from
Appellant.” (Appellant’s Brief at 13). Appellant emphasizes that the current
case sets out four counts of breach of fiduciary duty related to the operation
of a business, three tort claims against Appellee Bell, one quasi-contract claim
against Appellee Bell, two tort claims against Appellee Kirk, one tort claim
against Appellee W&W, and three counts of civil conspiracy against the three
defendants; none of these claims are asserted in the divorce action.
Appellant also insists that the relief requested in the current action is
different than that sought in the divorce action.4 Appellant contends that the
trial judge in the divorce action would lack authority to impose punitive
damages as sought in the instant case on a non-party to the divorce action.
Thus, Appellant claims that Kirk and W&W would escape liability for their
actions. Appellant also insists that his claim for damages in the instant matter
was not speculative where he set forth in his complaint an identifiable amount
of the assets that Appellees illegally transferred to W&W. Appellant concludes
the court erred by sustaining Appellee Bell’s preliminary objections based on
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4 Appellant reiterates that the court could not even consider what relief was
sought in the divorce action (i.e., equitable distribution) because Appellee Bell
did not attach a copy of the divorce complaint to her preliminary objections.
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the pendency of the divorce action, and this Court must reverse and remand
for further proceedings. We agree relief is due.
Initially we observe:
When considering the appropriateness of a ruling on
preliminary objections, the appellate court must apply the
same standard as the trial court.
Preliminary objections in the nature of a demurrer test the
legal sufficiency of the complaint. When considering
preliminary objections, all material facts set forth in the
challenged pleadings are admitted as true, as well as all
inferences reasonably deducible therefrom. Preliminary
objections which seek the dismissal of a cause of action
should be sustained only in cases in which it is clear and free
from doubt that the pleader will be unable to prove facts
legally sufficient to establish the right to relief. If any doubt
exists as to whether a demurrer should be sustained, it
should be resolved in favor of overruling the preliminary
objections.
Richmond v. McHale, 35 A.3d 779, 783 (Pa.Super. 2012) (quoting Feingold
v. Hendrzak, 15 A.3d 937, 941 (Pa.Super. 2011)).
Under Pa.R.C.P. 1028(a)(6), preliminary objections may be filed based
on the pendency of a prior action. Pa.R.C.P. 1028(a)(6). To successfully
object based on the pendency of a prior action (also known as the defense of
lis pendens), “it must be shown that the prior case is the same, the parties
are the same, and the relief requested is the same.” Richner v. McCance,
13 A.3d 950, 958 (Pa.Super. 2011) (internal citation and quotations omitted).
“This three-pronged identity test must be strictly applied when a party is
seeking to dismiss a claim under the doctrine of lis pendens.” Norristown
Auto. Co., Inc. v. Hand, 562 A.2d 902, 904 (Pa.Super. 1989). “Thus, this
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[C]ourt has refused to dismiss causes of action under the doctrine of lis
pendens in cases where the later cause of action derived from the same
contract or events that formed the basis of the prior action but the right
asserted and/or the relief sought in the two actions were not the same.” Id.(holding that facts of case did not meet strict identity requirements for
dismissal under doctrine of lis pendens where rights asserted and relief sought
were different in two actions, even though parties and key events underlying
both actions were same; reversing and remanding for further proceedings).
“Under Pennsylvania law, the question of a pending prior action is purely a
question of law determinable from an inspection of the pleadings.” Richner,
supra at 958. “Therefore, as to application of the doctrine, our scope of
review is plenary.” Barren v. Commonwealth of Pennsylvania, 74 A.3d
250, 253 (Pa.Super. 2013).
“Additionally, an abeyance may be appropriate even where the
petitioner cannot strictly meet the above-referenced test if the two actions
would create a duplication of effort on the part of the parties and waste judicial
resources by requiring two courts of common pleas to litigate a matter that in
all likelihood could be fully addressed in one forum.” PNC Bank, Nat. Ass’n
v. Bluestream Technology, Inc., 14 A.3d 831, 835 (Pa.Super. 2010). See
also Norristown Auto Co., supra (observing that party raising defense of
lis pendens can ask that action in which defense is being raised be abated,
that it be stayed pending outcome of prior litigation, or that actions be
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consolidated; noting that should appellee raise such issue on remand, trial
court may have to decide propriety of granting stay in instant matter to avoid
duplication of effort and waste of judicial resources that would result from
allowing both cases to proceed simultaneously).
Instantly, we must first consider Appellant’s claim that the trial court
was precluded from even considering the pending divorce litigation where
Appellee Bell did not attach a copy of the divorce complaint to her preliminary
objections. The trial court explained that it properly considered the pending
divorce action between Appellant and Appellee Bell, reasoning:
Appellant…argues that the trial court erred by considering
evidence outside of the pleadings by considering the divorce
because no copy of the divorce complaint was attached to
the complaint or Appellee Bell’s Motion to Dismiss.
Appellant…, however, admits in this complaint that the
couple is married and a divorce litigation is pending between
the two. Appellant…also states in his complaint that he and
Appellee Bell were business partners in addition to being
husband and wife.
It is reasonable to conclude that two people in the middle of
a divorce who are disputing the ownership of a business that
qualifies as marital property would likely also be fighting
over the business in the divorce. …[A] fact-finder is
expected to admit any insights that are reasonably deduced
from the filings as true and weigh such reasonably deduced
inferences in its final decision. Therefore, this court did not
err because it used a reasonably deduced inference that the
ownership of Simply Country and its assets was a matter for
equitable distribution to reach the conclusion to grant
Appellee Bell’s Motion to Dismiss.
(Rule 1925(a) Opinion, filed May 23, 2023, at unnumbered pp. 5-6).
Our review of the record supports the court’s analysis. Here, Appellant
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admitted in his second amended complaint that he was married to Appellee
Bell and that they were involved in divorce litigation. (See Second Amended
Complaint, filed 8/4/21, at 4 n.2; R.R. at 104). Appellant further alleged that
he and Appellee Bell signed the operating agreement for Simply Country while
they were married, and each owned a 50% interest in Simply Country. (See
id. at ¶¶ 16-17; R.R. at 106). Appellee Bell also alleged in her preliminary
objections that Appellant and Appellee Bell each owned 50% of Simply
Country, which they started while they were married, and that Appellant and
Appellee Bell were in the midst of divorce proceedings. (See Preliminary
Objections, filed 9/7/21, at ¶¶ 7, 9; R.R. at 59).
As the trial court correctly stated, “[w]hen considering preliminary
objections, all material facts set forth in the challenged pleadings are admitted
as true, as well as all inferences reasonably deducible therefrom.” See
Richmond, supra (emphasis added). Based on the allegations set forth in
the relevant pleadings that Appellant was married to Appellee Bell when they
formed Simply Country, that they were co-owners of Simply County, and that
they were in the midst of a divorce action, it was reasonable for the court to
infer that equitable distribution would be at issue in the divorce proceedings.
See id. Further, we observe that during the June 17, 2021 hearing on
Appellant’s request for a preliminary injunction, there were multiple
references to the divorce proceedings between Appellant and Appellee Bell,
and a valuation of Simply Country was ongoing in connection with the divorce.
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(See N.T. Hearing, 6/17/21, at 10, 11, 16, 49-50). Thus, the trial court was
free to reasonably infer that equitable distribution was an issue in the divorce
proceedings, even in the absence of reviewing the actual divorce complaint.
Regarding the trial court’s decision to dismiss Appellant’s complaint
without prejudice based on the pendency of the divorce action, the court
explained:
… The parties to the divorce are named in this action, the
contract dispute arises out of the same series of transactions
or occurrences as the divorce, and a major asset covered by
the pre-existing divorce case, ownership of Simply Country
and its assets, is here at issue. As noted above, the
business is marital property and the dispute between
Appellant…and Appellee Bell here is the same as the dispute
over the company concurrently taking place in the divorce.
It would therefore be unfair and a waste of judicial resources
to determine in this case what can be better and more fairly
decided in the pre-existing divorce case between
Appellant…and Appellee Bell.
[Appellant’s] claims for statutory and punitive damages can
also be resolved through the divorce action by identifying
what, if any, assets were wrongfully transferred from Simply
Country to Appellees Kirk and/or [W&W]. As this court
noted in its original memorandum regarding its decision in
this case, any alleged devaluation of a marital corporation
is entirely speculative because no actual harm has yet
occurred. Any assets that were sold or converted could be
discovered and inventories by the parties through the
normal process of equitable distribution so that each asset’s
monetary value may be determined and added to the pot
that would be equally split between husband and wife. This
court therefore did not err by granting Appellee’s
Preliminary Objections in order to prevent the confusion of
ownership over the business and the waste of judicial
resources that would necessarily follow the creation of
duplicate concurrent cases.
* * *
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Appellant…argues that the trial court improperly dismissed
the counts against Appellees Kirk and [W&W] because both
parties failed to file their own preliminary objections before
the time for filing objections expired. As this court has
noted in this memorandum, the counts against the three
appellees are inextricably linked to the divorce between
Appellant…and Appellee Bell and inseparable from each
other. It would, for example, be improper to dismiss the
counts against Appellee Bell but then hear arguments
against Appellee Kirk that he conspired with her to
fraudulently convert the assets of Simply Country because
it would be necessary for both co-conspirators to be joined
as defendants in the case. It would similarly contradict
reason for this court to dismiss the counts against Appellee
Bell in order to avoid wasting judicial resources but then
allow the same case to proceed against Appellees Kirk and
[W&W]. This court reiterates its above-stated argument
that the dismissal of the complaint is necessary to prevent
duplicity and the waste of judicial resources. Therefore, this
court did not err in dismissing the complaint in its entirety,
including the counts against Appellees Kirk [and W&W].
(Rule 1925(a) Opinion at unnumbered pp. 4-7) (internal citations and
footnotes omitted).
We cannot agree with this portion of the court’s analysis. The two cases
are not the same—the prior litigation at issue involves divorce (and, as
reasonably deduced from the pleadings, equitable distribution) while the
instant case involves claims of, inter alia, breach of fiduciary duty and
conspiracy to convert over $80,000.00 worth of assets. The parties are not
the same—the prior litigation involves only Appellant and Appellee Bell while
the instant litigation involves Appellant (individually), Appellant (on behalf of
Simply Country), Appellee Bell, Kirk, and W&W. And the relief sought is
different—the prior litigation seeks a divorce decree (and, as reasonably
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deduced from the pleadings, equitable distribution) while the instant case
seeks statutory damages, punitive damages, and attorney’s fees. Under a
strict application of the three-pronged test, Appellee Bell has failed to
demonstrate “that the prior case is the same, the parties are the same, and
the relief requested is the same.” See Richner, supra; Norristown Auto.
Co., supra.
Although the court made clear in its analysis that it wanted to avoid the
duplication of effort or the waste of judicial resources (see PNC Bank, supra;
Norristown Auto. Co., supra), the court’s order dismissing Appellant’s
complaint without prejudice did not expressly stay the instant action pending
resolution of the divorce action.5 Therefore, upon remand, the trial court may
consider whether a stay or abeyance of the instant case is appropriate. See
Norristown Auto. Co., supra. Upon remand, the court may also consider
whether any other grounds alleged in Appellee Bell’s preliminary objections
warrant dismissal of the complaint. Accordingly, we reverse the order
sustaining Appellee Bell’s preliminary objections and dismissing Appellant’s
complaint without prejudice, and remand for further proceedings.6
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5 See generally Williams Studio Div. of Photography by Tallas, Inc. v.
Nationwide Mut. Fire Ins. Co., 550 A.2d 1333, 1335 (Pa.Super. 1988)
(explaining that statute of limitations is not tolled by filing of complaint
subsequently dismissed without prejudice).
6 Based on our disposition, we need not address Appellant’s second issue.
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Order reversed. Case remanded. Jurisdiction is relinquished.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 8/29/2023
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