Opinion
J-A11017-13 No. 1579 MDA 2012
03-31-2014
HIGHWAY EQUIPMENT AND SUPPLY COMPANY Appellee v. ALBERT ARILLOTTA, INDIVIDUALLY AND D/B/A GLOBAL DEMOLITION Appellant
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
Appeal from the Order Entered August 3, 2012
In the Court of Common Pleas of Dauphin County
Civil Division at No.: 2012-CV-509-NT
BEFORE: FORD ELLIOTT, P.J.E., WECHT, J., and COLVILLE, J. MEMORANDUM BY WECHT, J.:
Judge Colville did not participate in the consideration or decision of this case.
Albert Arillotta ("Appellant") appeals from the August 3, 2012 order denying his petition to strike/open a confessed judgment entered on January 20, 2012 for Highway Equipment & Supply Co. ("Appellee"). We affirm.
This case concerns two heavy equipment rental contracts that were executed between Appellant and Appellee on or about March 17, 2011, and May 16, 2011, respectively. See Appellee's Complaint for Confession of Judgment, 1/20/2012, at 1-2; Brief for Appellant at 5. Following Appellant's non-payment under the terms of the rental agreements, Appellee sought a confessed judgment against Appellant in the amount of $76,735.53 for unpaid rent and service charges. The trial court has aptly summarized the remaining procedural history of this case as follows:
On January 20, 2012, [Appellee] filed a Complaint in Confession of Judgment against [Appellant], which was authorized by warrants of attorney included in the terms and conditions of two rental contracts executed by the parties on March 17, 2011[,] and May 16, 2011, respectively. Judgment was entered by the Dauphin County Prothonotary on the same day. On March 2, 2012, Appellant filed a "Petition to Strike and/or Open Confessed Judgment" to which [] Appellee responded on April 2, 2012. At Appellant's request, the [c]ourt heard oral argument on July 31, 2012 and, on August 3, 2012, [the trial court] denied the Petition.Trial Court Opinion ("T.C.O."), 11/16/2012, at 1. This timely appeal followed. On September 7, 2012, the trial court directed Appellant to file a concise statement of errors complained of on appeal pursuant to Pa.R.A.P. 1925(b). On September 28, 2012, Appellant timely complied. On November 16, 2012, the trial court issued its Rule 1925(a) opinion.
Appellant raises the following issues for our consideration:
1. Did the court below err as a matter of law, or commit a manifest abuse of discretion, in refusing to open the judgment by confession entered against [Appellant], personally notwithstanding [Appellant's] execution of two (2) Rental Contracts at issue in his capacity as the sole Manager of Global Demolition & Recycling, LLC, a duly formed Delaware limited liability corporation, and not in his individual capacity as evident on the face of the Rental Contracts themselves?Brief for Appellant at 3. We will address both of Appellant's issues in turn.
2. Did the court below err in refusing to take judicial notice of a contemporaneous Complaint for Confession of Judgment filed by [Appellee] against Global Demolition & Recycling,
LLC[,] where Appellee admitted to the filing of that action in its Answer filed in this proceeding?
Appellant first challenges the trial court's refusal to open the confessed judgment. While the object of Appellant's first issue is self-evident, his alleged grounds for relief are less clear from his brief. The most direct statement of Appellant's first claim is his assertion that he contests the trial court's refusal to open the confessed judgment on the basis of "substantive Pennsylvania law regarding when an officer of a corporation can properly be held personally liable upon a contract signed by him or her." Brief for Appellant at 15. In clearer terms, Appellant claims that he signed the two contracts at issue in his representative capacity with regard to the company listed on the contract (Global Demolition). Hence, he claims, the trial court erred in holding him personally liable.
In his discussion of his first claim, Appellant also asserts additional claims that the trial court "failed to adhere to" legal principles relating to Pa.R.C.P. 2959(e) and the proper standards for assessing petitions to open a confessed judgment. Brief for Appellant at 8-11. To the extent that Appellant relies upon these claims, they are waived for failure properly to include them in his statement of questions presented. Pa.R.A.P. 2116(a) ("No question will be considered unless it is stated in the statement of questions involved or is fairly suggested thereby."); see also Krebs v. United Refining Co. of Penna., 893 A.2d 776, 797 (Pa. Super. 2006) ("We will not ordinarily consider any issue if it has not been set forth in or suggested by an appellate brief's statement of questions involved. . . .").
Although a petition to open a confessed judgment and a petition to strike a confessed judgment properly are brought in the same petition, see Pa.R.C.P. 2959, the two are distinct forms of relief, seeking different remedies and governed by different legal standards. Resolution Trust Corp. v. Copley Qu-Wayne Assoc., 683 A.2d 269, 273 (Pa. 1996). A petition to strike a confessed judgment is a common law proceeding which operates as a demurrer to the record, id. (citing Bethlehem Steel Corp. v. Tri State Industries, Inc., 434 A.2d 1236, 1240-41 (Pa. Super. 1981)), and which will only be granted if a fatal defect or irregularity appears on the face of the record. Id. (citing Franklin Interiors v. Wall of Fame Management Co., Inc., 511 A.2d 761, 762 (Pa. 1986)). "However, if the truth of the factual averments contained in such record are disputed, then the remedy is by a proceeding to open the judgment and not to strike." Id. (citing Northway Village No. 3, Inc. v. Northway Properties, Inc., 244 A.2d 47, 49 (Pa. 1968); Manor Bldg. Corp. v. Manor Complex Associates, Ltd., 645 A.2d 843, 846 (Pa. Super. 1994)).
Appellant's petition challenges the factual bases of the trial court's opinion, it is referred to specifically as a petition to open a confessed judgment in Appellant's statement of issues, and Appellant cites exclusively to legal authority adjudicating petitions to open a confessed judgment. Brief for Appellant at 1-20. Consequently, we will address Appellant's issue as a petition to open a confessed judgment.
A petition to open a confessed judgment is an appeal to the trial court's equitable powers. Crum v. F.L. Shaffer Co., 693 A.2d 984, 986 (Pa. Super. 1997) (citing Liazis v. Kosta, Inc., 618 A.2d 450, 452 (Pa. Super. 1992)). "Once a ruling . . . refusing to open a confessed judgment is appealed, we . . . will refrain from reversing a trial court's decision unless it is shown that the court committed an error of law or manifestly abused its discretion." Lambakis v. Exar, 490 A.2d 882, 884 (Pa. Super. 1985). In order to meet this appellate burden, the petitioner must act promptly, allege a meritorious defense, and provide sufficient evidence to create an issue for the fact-finder. Crum, 693 A.2d at 986 (citing Dorsey, 683 A.2d at 294); see also Pa.R.C.P. 2959(e)). However, "Rule 2959(e) has been interpreted since its promulgation in 1973 as prohibiting [an appellate] court from 'weighing' the sufficiency of the evidence." Suburban Mechanical Contractors, Inc. v. Leo, 502 A.2d 230, 232 (Pa. Super. 1985) (quoting First Penna. Bank, N.A. v. Lehr, 438 A.2d 600, 602 (Pa. Super. 1980)). Consequently, petitioners must present "clear, direct, and precise and believable evidence" to support a petition to open a confessed judgment. Id. (quoting Lehr, 438 A.2d at 607). In determining whether sufficient evidence has been presented, we view all the evidence in the light most favorable to the petitioner and accept as true all evidence and proper inferences therefrom supporting the defense while we reject adverse allegations of the party obtaining the judgment." Id. (quoting Leo, 502 A.2d at 232).
Prior to the promulgation of Rule 2959(e), petitioners were required to present "convincing" evidence in support of their petitions to open a confessed judgment. See First Pennsylvania Bank, N.A. v. Lehr, 438 A.2d 600, 607 (Pa. Super. 1980). "Now, we believe that a moving party no longer is required to produce clear, direct, precise and convincing evidence; now that requirement has been substantially liberalized to require only clear, direct, precise and 'believable' evidence, which would in a jury trial preclude the entry of a directed verdict." Id. This jurisprudential shift was necessary because "'convincing' evidence by definition requires a weighing of the evidence." Id.; see also Suburban Mechanical Contractors, Inc. v. Leo, 502 A.2d 230, 232 (Pa. Super. 1985) ("Rule 2959(e) has been interpreted since its promulgation in 1973 as prohibiting a court from 'weighing' the sufficiency of the evidence.").
Appellant timely filed his petition to open the confessed judgment before the trial court. Petitions to open or strike confessed judgments must be filed within thirty days after the party against whom judgment is confessed receives a notice of execution pursuant to either Pa.R.C.P. 2956.1 or Pa.R.C.P. 2973.1. See Magee v. J.G. Wentworth & Co., Inc., 761 A.2d 159, 161 (Pa. Super. 2000) (citing Thomas Associates v. GPI LTD, Inc., 711 A.2d 506, 509 (Pa. Super. 1998)). If a judgment-creditor fails to file a notice of execution, the "timeliness clock" does not begin to run against the judgment-debtor. Magee, 761 A.2d at 161. Appellant filed his petition to open/strike the confessed judgment on March 2, 2012. See Appellant's Petition to Strike And/Or Open Confessed Judgment, 3/2/2012, at 1. The certified record indicates that Appellee never filed a notice of execution. Therefore, the thirty-day limit had not even begun to accrue against Appellant when he filed his petition. See Magee, supra. Appellant has acted promptly in filing his petition.
The trial court did not address the issue of timeliness in its Rule 1925(a) opinion, except to state that it appeared that Appellant's petition was filed timely. See T.C.O. at 3 n.2.
However, even assuming, arguendo, that Appellant has presented a meritorious defense, his first claim fails because he did not provide sufficient evidence to create an issue for the fact-finder. See Crum, supra. Appellant claims that "he is not a proper party to be held individually liable under the Rental Contracts." Brief for Appellant at 13. Appellant argues that his petition "raised numerous facts which provide ample support for, at a minimum, finding that whether he executed the [two] Rental Contracts . . . in his individual capacity is an issue which requires submission to a jury." Id. at 17. We disagree.
In support of his claim, Appellant provides the following list of facts that he avers created a question for the fact-finder: (1) that a corporation named "Global Demolition & Recycling, LLC" is an active entity in Delaware; (2) that, with the exception of his signature, Appellant's name does not appear on the contract; and (3) that the notation "MGR." appears beneath Appellant's signature on the May 16, 2011 lease. Brief for Appellant at 17-18. Viewing this proffered evidence in the light most favorable to Appellant, we cannot conclude that it qualifies as "clear, direct, and precise and believable" under Lehr so as to create a jury question.
The only documentation of record in this case that speaks directly to the viability of Appellant's corporate allegations is a one-page print-out from the Pennsylvania Department of State website which lists Global Demolition and Recycling, LLC, as an active corporation. See Department of State Print-Out, 3/1/2012, at 1 (unpaginated). The document identifies no corporate officers and contains no relevant information beyond the facts that the corporation was created on March 27, 2008, and does business in Delaware. Id.
Appellant contends that the trial court acted improperly by deciding this matter without ordering discovery, asserting that the trial court "essentially penalized [Appellant] for failing to seek leave of court to conduct . . . depositions." Brief for Appellant at 18. We discern no error. The trial court's March 9, 2012 order and rule to show cause is silent as to a schedule for depositions. Order, 3/9/2012, at 1. Although Appellant included a provision that originally set a sixty-day deadline for depositions, the trial court crossed this provision out. Id. Appellant contends that he "reasonably interpreted the action of the court below in striking [a] provision providing for depositions as a determination of the learned Judge below that such depositions were unnecessary under the circumstances." Brief for Appellant at 18. Appellant took no discovery, and filed no motion seeking it. "While the court itself may set a timetable for the taking of depositions and for decision on the petition, there is no requirement that the court do so." Lazzarotti v. Juliano, 469 A.2d 216, 218-19 (Pa. Super. 1983) (citations omitted). Appellee filed an answer to Appellant's petition on April 2, 2012 denying four of Appellant's claims. Appellee's Answer to Petition to Strike or Open Confessed Judgment, 4/2/2012, at 1-2. Civil Rule 206.7(c) states that, "[i]f an answer [to a rule to show cause] is filed raising disputed issues of material facts" and the petitioner fails to take discovery, then the petition shall be decided upon the basis of the petition and answer alone. See Pa.R.C.P. 206.7(c). Furthermore, in a July 10, 2012 motion to the trial court, Appellant specifically requested that arguments on the petition to open the confessed judgment be scheduled. Appellant's Uncontested Motion to Schedule Arguments, 7/10/2012, at 1-3. "Remand is not required where either the petitioner or respondent lists the case for argument on the basis of the petition and answer alone." Lazzarotti, 469 A.2d at 219 (emphasis in original).
The trial court aptly addressed the deficiency of Appellant's arguments related to corporate liability:
[Appellant] asserts that one of the rental contracts contains a hand-written notation including the phrase "Mgr." which, Appellant claims, establishes the he executed the contracts while acting as "Manager" of the company. However, we do not believe this notation unambiguously demonstrates that Appellant signed the rental contracts in a representative capacity, especially where the second contract did not include any such notation and Appellant did not allege that his position as "Manager" confers upon him the authority to bind the business.T.C.O. at 3-4. A review of the contract provisions reveals no terms that explicitly limit Appellant's liability based upon his alleged corporate position. Even assuming that all of the evidence presented by Appellant is true, that evidence fails to speak directly to any agency relationship between Appellant and the company listed on the contract.
* * *
[Appellant also] argues that Appellee knew, as a result of "previous commercial transactions," that Appellant was a representative of "Global Demolition and Recycling, LLC" and that he executed the rental contracts as such. However, Appellant's [p]etition does not allege, nor does the evidence presented establish, that "Global Demolition" and "Global Demolition and Recycling, LLC" are one and the same business entity[] or that Appellee knew of his representative capacity because of certain prior transactions between the parties.
The name "Global Demolition" appears as the Lessee on the two leases at issue. See Rental Contract, 3/17/2011, at 1; Rental Contract, 5/16/2011, at 1. The name "Global Demolition and Recycling, LLC" does not appear on either of the two contracts. Id.
It is axiomatic under Pennsylvania law that the intent of the parties to a contract must be determined from the terms of the instrument and the circumstances surrounding its creation. Hillbrook Apartments, Inc. v. Nyce Crete Co., 352 A.2d 148, 151 (Pa. Super. 1975) (citing Mowrer v. Pirier & McLane Corp., 114 A.2d 88, 89 (Pa. 1955)). "Individual officers of a corporation can bind the corporation only when they act in their official capacities . . . and within the scope of their authority. Their acts as individuals . . . are not binding upon the corporation sought to be charged." Id. at 152 (citing Peterson v. Marianna Borough, 165 A. 838, 841 (Pa. 1933)). Therefore, "if one so acting is to escape personal liability for what he intends to be a corporate obligation, the limitation of his responsibility should be made to appear on the face of the instrument. Otherwise, the individual signature imports a personal liability[.]" Id. (citing Strauss & Co. v. Berman, 147 A. 85, 86 (Pa. 1929); Flexlume Corp. v. Norris, 98 Pa. Super. 530, 532-33 (Pa. Super. 1929)).
We find no abuse of discretion in the trial court's actions. Consequently, Appellant's first claim fails. See Hazer v. Zabala, 26 A.3d 1166, 1170 (Pa. Super. 2011) (finding signatory personally liable for lease that he signed with a hand-written notation indicating that petitioner was doing business as a corporation); see also Bell v. Dornan, 201 A.2d 324, 326-27 (Pa. Super. 1964) (finding corporate officer personally liable where he signed contract that included corporate name and seal but failed to identify his representative capacity).
We turn now to Appellant's second claim. In relevant part, Appellant asserts that the trial court erred by failing to take judicial notice of a second, contemporaneous civil action in the Dauphin County Court of Common Pleas between Appellee and Global Demolition and Recycling, LLC at the July 31, 2012 oral arguments. A judicially noticed fact is one that is "not subject to reasonable dispute" because it is either: "(1) generally known within the territorial jurisdiction of the trial court; or (2) capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." Pa.R.E. 201(b). "[D]isputed questions of fact are not within the domain of judicial notice." Haber v. Monroe County Vocational-Technical School, 442 A.2d 292, 296 (Pa. Super. 1982) (citing Chaplin v. Pelton, 423 A.2d 8, 9 (Pa. Super. 1980)).
Appellant contends that the contract at issue in the separate civil action established that Appellee was "clearly on notice that Global Demolition and Recycling, LLC was an active corporation and [that Appellant] was a principal in that entity at the time the Rental Contracts . . . were prepared by Highway Equipment and executed." Brief for Appellant at 11. We conclude that Appellant has waived this claim.
It is axiomatic in Pennsylvania that "[a]n appellate court may consider only the facts which have been duly certified in the record on appeal." Commonwealth v. Young, 317 A.2d 258, 264 (Pa. 1974); see Pa.R.A.P. 1921. Furthermore, it remains the duty of an appellant "to ensure that the original record certified for appeal contains sufficient information to conduct a proper [appellate] review." Kessler v. Broder, 851 A.2d 944, 950 (Pa. Super. 2004). Failure to do so may result in waiver. Id.
The certified record in this case does not confirm that Appellant asked the trial court to take judicial notice of the alleged rental contracts in the other civil case. There is no transcript of the July 31, 2012 hearing in the certified record, and there are no references to such a transcript in any of the submissions made by Appellant, Appellee, or the trial court. The Pennsylvania Rules of Appellate Procedure require appellants to order and pay for any transcript necessary to permit resolution of the issues raised on appeal. See Pa.R.A.P. 1911(a) ("The appellant shall request any transcript required under this chapter in the manner and make any necessary payment or deposit thereof in the amount and within the time prescribed . . . ."). Appellant made no submission pursuant to Pennsylvania Rule of Appellate Procedure 1923. See Pa.R.A.P. 1923 ("If no report of the evidence or proceedings at a hearing or trial was made, or if a transcript is unavailable, the appellant may prepare a statement of the evidence or proceedings from the best available means, including his recollection."). Furthermore, "[i]t is not proper for either the Pennsylvania Supreme Court or the Superior Court to order transcripts[,] nor is it the responsibility of the appellate courts to obtain the necessary transcripts." See Commonwealth v. Preston, 904 A.2d 1, 7 (Pa. Super. 2006).
The language used by the trial court and parties in reference to Appellant's judicial notice claim raises substantial doubts as to whether Appellant ever asked the trial court to take judicial notice of the alleged documents. In the absence of a transcript, we cannot confirm Appellant's initial request for judicial notice. "When the appellant . . . fails to conform to the requirements of Rule 1911, any claims that cannot be resolved in the absence of the necessary transcript or transcripts must be deemed waived for the purpose of appellate review." Preston, 904 A.2d at 7.
This Court may engage in an "informal inquiry" in cases where the failure to transmit parts of a record results from an "extraordinary breakdown in the judicial process." See Preston, 904 A.2d at 8. However, this precedent only applies where there is initial evidence of some error:
[I]n the absence of specific indicators that a relevant document exists but was inadvertently omitted from the certified record, it is not incumbent upon this Court to expend time, effort and manpower scouting around judicial chambers or the various prothonotaries' offices of the courts of common pleas for the purpose of unearthing transcripts, exhibits, letters, writs or PCRA petitions that well may have been presented to the trial court but never were formally introduced and made part of the certified record.Id. There is no indication that the instant record is incomplete due to error.
Additionally, Appellee argues that Appellant never sought to make the alleged contract in the contemporaneous civil action part of the record in this case: "The documents relating to the confession against the LLC entity [in the separate civil case] are simply not of record and cannot be considered. . . . [T]here was never an 'evidentiary ruling' made - because the documents [in the contemporaneous civil action] were never offered." Brief for Appellee at 4 (underlining omitted). After reviewing the certified record, we have found no copy of the contract that Appellant argues the trial court should have judicially noticed. Consequently, we cannot determine whether the trial court properly could have taken judicial notice of that document.
We reproduce the following passage from this Court's decision in Smith v. Smith, discussing Appellant's obligations with reference to the appellate record, and the consequences for non-compliance:
"First, it is black letter law in this jurisdiction that an appellate court cannot consider anything which is not a part of the record in the case. Second, it is the responsibility of the Appellant to supply this Court with a complete record for purposes of review. Third, although no reproduced record has been offered by the Appellant to remedy the deficiency in the original record, we would note that reproduction of the record is not an acceptable substitute for the original, certified record. Fourth, a failure by an Appellant to insure that the original record certified for appeal contains sufficient information to conduct a proper review constitutes a waiver of the issue(s) sought to be examined."Smith v. Smith, 637 A.2d 622, 623-24 (Pa. Super. 1993) (internal citations omitted, italics in original).
It may well be that the trial court could have taken judicial notice of the alleged contract in the contemporaneous civil action invoked by Appellant. However, in the absence of any documentation relating to the July 31, 2012 proceeding or the at-issue contract from Appellant, we conclude that Appellant has waived his second claim. See Growall v. Maietta, 931 A.2d 667, 676 (Pa. Super. 2007) (citing Smith, 637 A.2d at 623-24) (holding that an appellant waived claim on failure to include "sufficient information" for this Court to conduct a review). Accordingly, we do not address the merits of that claim. Judgment Entered. __________
Joseph D. Seletyn, Esq.
Prothonotary