Summary
holding that second judge could not allow party to amend a pleading to raise an affirmative defense when another judge had determined the defense was waived in an earlier ruling
Summary of this case from Winig v. KangOpinion
No. 23 WAP 2020
10-20-2021
Sharleen M. RELLICK-SMITH, Appellant v. Betty J. RELLICK and Kimberly V. Vasil, Appellees
William James Carmella, Esq., James D. Carmella, Attorney at Law, for Appellant. Jesse David Daniel, Esq., The Daniel Law Group, PLLC, for Appellees.
William James Carmella, Esq., James D. Carmella, Attorney at Law, for Appellant.
Jesse David Daniel, Esq., The Daniel Law Group, PLLC, for Appellees.
BAER, C.J., SAYLOR, TODD, DONOHUE, DOUGHERTY, WECHT, MUNDY, JJ.
OPINION ANNOUNCING THE JUDGMENT OF THE COURT
JUSTICE TODD
In this appeal by allowance, we consider whether the Superior Court erred in affirming an order of the trial court that permitted the appellees to file an amended answer to include the affirmative defense of statute of limitations, which a different trial court judge previously ruled was waived. As we conclude that the second trial judge's order violated the coordinate jurisdiction rule in this regard, we hold that the Superior Court erred in affirming his order, and, accordingly, we reverse the Superior Court's decision, vacate in part the trial judge's order, and remand the matter to the trial court for further proceedings consistent with this opinion.
On August 6, 2006, Rose Rellick (hereinafter, "Decedent"), purchased two Certificates of Deposit ("CDs"), listing as co-owners herself; her sister, Betty J. Rellick; and the daughters of her deceased brother George - Kimberly Vasil and Sharleen M. Rellick-Smith (hereinafter, "Appellant"). Prior to purchasing the CDs, Decedent executed powers of attorney designating Betty and Kimberly (hereinafter, "Appellees") as her attorneys-in-fact. It purportedly was Decedent's intention that, upon her death, the proceeds of the CDs be divided equally among Appellant and Appellees. However, on July 31, 2009, prior to Decedent's death, Appellees removed Appellant's name from the CDs. In March 2013, subsequent to Decedent's death, Appellees cashed the CDs, which were worth approximately $370,000, and divided the money between the two of them.
Decedent died on December 20, 2012.
On October 10, 2014, Appellant filed an action against Appellees, claiming they breached their fiduciary duties to Decedent by removing Appellant's name from the CDs and refusing to pay her any of the proceeds. Appellees filed a timely response to the complaint, but, relevant to the instant appeal, did not raise any affirmative defenses therein. Four months later, on February 11, 2015, Appellees filed a "motion to dismiss," arguing that Appellant lacked standing and that her claim was barred by the statute of limitations. The case was assigned to the Honorable Carol Hanna, who granted Appellees’ motion on the basis that Appellant lacked standing. Notably, however, Judge Hanna determined that Appellees waived the statute of limitations defense by failing to raise it as a new matter in their answer, as required by Pa.R.C.P. 1030(a) ("[A]ll affirmative defenses including ... statute of limitations ... shall be pleaded in a responsive pleading under the heading ‘New Matter.’ ").
In their brief, Appellees recognize that the motion filed on their behalf was incorrectly titled a "Motion to Dismiss," and should have been designated as a "Motion for Judgment on the Pleadings." See Appellees’ Brief at 3 n.2. We will utilize the proper designation of "motion for judgment on the pleadings" throughout this opinion.
Appellant appealed Judge Hanna's order, and the Superior Court reversed and remanded the case to the trial court, holding that Appellant, in fact, did have standing to pursue her claim. Rellick-Smith v. Rellick , 147 A.3d 897, 904 (Pa. Super. 2016). In its opinion, the Superior Court observed that neither party challenged Judge Hanna's finding that Appellees waived the statute of limitations defense. Id. at 901 n.12 ("Neither party addresses on appeal the statute of limitations issue raised in [Appellees’] Motion to Dismiss.").
On remand, the case initially was assigned to the Honorable William Martin, as Judge Hanna had retired from the court on June 6, 2016. On May 16, 2017, Appellees filed a motion for summary judgment wherein they made no mention of the statute of limitations defense. Judge Martin denied the motion for summary judgment, finding there were outstanding issues of material fact. Thereafter, the case was reassigned to the Honorable Thomas M. Bianco, who presided over all remaining proceedings.
On July 30, 2018, Appellees filed a motion to amend their pleading to include numerous affirmative defenses, including a statute of limitations defense. Acknowledging Judge Hanna's finding that Appellees waived the statute of limitations defense by failing to raise it in their answer to Appellant's complaint, Judge Bianco nevertheless granted Appellees’ motion to amend based on the Superior Court's decision in Horowitz v. Universal Underwriters Insurance Co. , 397 Pa.Super. 473, 580 A.2d 395 (1990) (holding that trial court should have allowed party to amend its answer to affirmatively plead statute of limitations defense despite the fact that amendment was sought more than four years after original answer was filed), which, in his view, supports the liberal amendment of pleadings. Judge Bianco reasoned, inter alia , that Appellant would not be prejudiced if Appellees were permitted to amend their pleading, as Appellees’ assertion of the statute of limitations defense did not come as a surprise to Appellant, given that Appellees raised it in their February 2015 motion for judgment on the pleadings before Judge Hanna. Judge Bianco further determined that Appellant failed to establish that material evidence was lost due to Appellees’ delay in raising the statute of limitations defense.
Following the grant of Appellees’ motion to amend, the case proceeded to a non-jury trial, at which Appellant testified to the facts set forth above. Appellant stated that she could not recall when she learned that Appellees removed her name from the CDs. Appellant also presented the testimony of Ann Marcoaldi, Decedent's secretary and tax preparer. Marcoaldi testified that Decedent purchased the CDs for estate planning purposes, and that Decedent intended that the proceeds of the CDs be divided equally between Appellant and Appellees following her death. Marcoaldi stated that she and Appellant learned in September 2009 that Appellees removed Appellant's name from the CDs, and that they began to "investigate the removal around that time." Rellick-Smith v. Rellick , No. 919 WDA 2019, at 3, 2020 WL 1528126 (Pa. Super. filed March 31, 2020). Ultimately, Judge Bianco determined that Appellant learned that Appellees removed her name from the CDs in September 2009, at which point the two-year statute of limitations began to run. As a result, he concluded that Appellant's action, filed on October 10, 2014, was barred by the statute of limitations, and he declined to address the underlying merits of her claim.
Appellant appealed Judge Bianco's order to the Superior Court, arguing, inter alia , that he erred in granting Appellees’ motion to amend their pleading to include a statute of limitations defense because Appellees waived that defense by failing to raise it in their initial response to her complaint. Furthermore, Appellant alleged that, in light of Judge Hanna's prior determination that Appellees waived the statute of limitations defense, Judge Bianco was precluded from granting Appellees’ motion to amend their pleading to include that defense under the coordinate jurisdiction rule, which generally prohibits a judge from altering the resolution of legal questions previously decided by another judge of coordinate jurisdiction. See Commonwealth v. Starr , 541 Pa. 564, 664 A.2d 1326, 1331 (1995). Finally, Appellant claimed she was prejudiced by Appellees’ delay in raising a statute of limitations defense because her witness's memory had diminished by the time the matter finally proceeded to trial.
As further discussed infra , departure from the rule is permitted in exceptional circumstances, such as where there has been an intervening change in the controlling law or a substantial change in the facts or evidence, or where the prior holding was clearly erroneous and would result in manifest injustice if upheld. Starr , 664 A.2d at 1332.
The Superior Court affirmed Judge Bianco's order in a divided, unpublished memorandum opinion authored by Senior Judge Pellegrini. Rellick-Smith, supra. The court rejected Appellant's contention that, under the coordinate jurisdiction rule, Judge Bianco was required to hold that Appellees waived the statute of limitations defense by failing to raise it in new matter. It recounted that, in Riccio v. American Republic Insurance Co. , 550 Pa. 254, 705 A.2d 422 (1997), this Court explained that, when determining whether the coordinate jurisdiction rule applies, we "look[ ] to where the rulings occurred in the context of the procedural posture of the case," and stated:
Where the motions differ in kind, as preliminary objections differ from motions for judgment on the pleadings, which differ from motions for summary judgment, a judge ruling on a later motion is not precluded from granting relief although another judge had denied an earlier motion. However, a later motion should not be entertained or granted when a motion of the same kind has previously been denied, unless intervening changes in the facts or the law clearly warrant a new look at the question.
Id. at 425 (citation omitted).
The Superior Court suggested that Appellees, in their motion to amend their pleading, did not ask Judge Bianco to overturn Judge Hanna's waiver ruling, but, rather, presented an "entirely different procedural question: whether [Appellant] would be prejudiced by the delay in raising the statute of limitations defense." Rellick-Smith , 919 WDA 2019, at 7. For this reason, the Superior Court determined that "[t]he law of the case doctrine did not bar [Judge Bianco] from addressing this question which had not been presented to Judge Hanna" or raised in the previous appeal. Id. Additionally, the Superior Court concluded that Appellant was not prejudiced by Appellees’ delayed invocation of the statute of limitations defense, given that Appellees initially attempted to raise it in their February 2015 motion for judgment on the pleadings, which was filed a mere four months after Appellant filed her complaint.
The coordinate jurisdiction rule is one of the distinct rules encompassed by the broader "law of the case" doctrine. Zane v. Friends Hospital , 575 Pa. 236, 836 A.2d 25, 29 (2003).
The Honorable Mary Jane Bowes authored a dissenting opinion in which she opined that, under the coordinate jurisdiction rule, Judge Hanna's finding that Appellees waived the statute of limitations defense was binding on Judge Bianco, and, therefore, precluded him from granting Appellees’ motion to amend their pleadings to include a statute of limitations defense. First, Judge Bowes disagreed with Judge Bianco's reliance on Horowitz, noting that the coordinate jurisdiction rule was not implicated in that case. She further suggested that Judge Bianco's focus on the absence of prejudice to Appellant was improper, as a showing of prejudice is unnecessary when an order allowing a proposed amendment to a pleading violates the law of the case doctrine. Judge Bowes concluded that Appellant had a right to rely upon Judge Hanna's waiver determination, reiterating that "[t]he law of the case doctrine recognizes that when later rulings upend earlier rulings, the parties’ expectations are dashed, proceedings are inconsistent, and finality is undercut." Rellick-Smith , 919 WDA 2019, at 9 (Bowes, J., dissenting).
Judge Bowes further noted that Judge Hanna's finding of waiver was consistent with both Pa.R.C.P. 1030(a), and Pa.R.C.P. 1032(a) ("A party waives all defenses and objections which are not presented either by preliminary objection, answer or reply, except a defense which is not required to be pleaded under Rule 1030(b) [.]"), and, therefore, was not "clearly erroneous." Id. at 6. Moreover, she observed there had been no intervening change in the law, facts, or evidence that would render the coordinate jurisdiction rule inapplicable. See Starr , 664 A.2d at 1332. Accordingly, Judge Bowes opined that Judge Bianco had no basis for disregarding Judge Hanna's ruling, and she indicated that she would have vacated Judge Bianco's order and remanded for findings of fact and conclusions of law regarding the underlying merits of Appellant's claims.
Appellant filed a petition for allowance of appeal, and we granted review to consider whether the Superior Court erred in affirming Judge Bianco's decision allowing Appellees to file an amended answer to include the affirmative defense of statute of limitations, notwithstanding Judge Hanna's prior determination that Appellees waived the statute of limitations defense. Specifically, we must determine whether Judge Bianco's order violated the coordinate jurisdiction rule. This question presents an issue of law, over which our standard of review is de novo , and our scope of review is plenary. Zane , 836 A.2d at 30 n.8.
Appellant argues that Judge Bianco's grant of Appellees’ motion to amend their pleadings to add a statute of limitations defense, after Judge Hanna held that Appellees waived the statute of limitations defense, was a clear violation of the coordinate jurisdiction rule. Appellant further asserts that there were no exceptional circumstances to support Judge Bianco's departure from the rule, as Judge Hanna's finding of waiver was consistent with Pa.R.C.P. 1030, and thus not clearly erroneous, and there were no intervening changes of law or fact.
Appellant, as did Judge Bowes in her dissent, challenges Judge Bianco's reliance on Horowitz , emphasizing that Horowitz did not involve the law of the case doctrine or the coordinate jurisdiction rule. Appellant maintains that Horowitz is also distinguishable because, in that case, the Superior Court concluded that there was no evidence to suggest that the opposing party would be prejudiced by the amendment, whereas, in the instant case, there was clear prejudice because her memory, and the memory of her witnesses, which had diminished over the span of four years, were central to Judge Bianco's ruling on the underlying merits of the statute of limitations issue.
Appellees respond by arguing, in the first instance, that Judge Bianco's order granting their petition to amend their pleading did not violate the coordinate jurisdiction rule because his order was not actually inconsistent with Judge Hanna's previous finding of waiver. In this regard, Appellees note that, while Rule 1030 requires that affirmative defenses, including a statute of limitations defense, be raised in an answer and new matter upon pain of waiver under Rule 1032(a), Rule 1033(a) specifically allows for the amendment of a pleading to "aver transactions or occurrences which have happened before or after the filing of the original pleading, even though they give rise to a new cause of action or defense ." Appellees’ Brief at 6 (quoting Pa.R.C.P. 1033(a) ) (emphasis original).
Thus, Appellees submit that:
[t]he waiver of those affirmative defenses that automatically occur upon a failure to plead them cannot serve as a basis to deny a subsequent request to amend a pleading to add that waived affirmative defense, because then a party could never amend a pleading to add an affirmative defense, as all unpled affirmative defenses are automatically waived the instant they are not pled. Such a result would be absurd and disfavored in the law.
Id. at 6-7. In support of their interpretation, Appellees cite this Court's decision in Martin v. Wilson , 371 Pa. 529, 92 A.2d 193 (1952), wherein we stated that, under Rule 1030, a failure to plead an affirmative defense "renders the defense unavailable at the trial of the issue ," id. at 195 (emphasis added), positing that this Court's use of the emphasized language suggests that waiver does not immediately occur upon a failure to plead the affirmative defense.
Appellees additionally contend that Judge Bianco's order did not violate the coordinate jurisdiction rule because, at the time he issued his ruling, the procedural posture of the case was different than it was when Judge Hanna issued her decision concluding that Appellees waived the statute of limitations defense. In this regard, Appellees emphasize that Judge Hanna's ruling was issued in response to Appellees’ motion for judgment on the pleadings, "which required [Judge Hanna] to consider and accept all well-pled allegations of the complaint as true, and determine whether on the facts averred, the law concludes that no recovery is possible, with any doubts on whether to grant [Appellees’ motion]" being resolved in favor of Appellant, whereas Judge Bianco's ruling was rendered following the close of discovery, and was based on "completely different facts and law; specifically, whether given Pennsylvania's liberal standard for granting amendments to the pleadings, would allowing the amendment prejudice [Appellant] or be against a positive rule of law." Appellees’ Brief at 20 (citing Horowitz , supra ).
To support their contention that the procedural posture of the instant case was different at the time Judge Hanna and Judge Bianco issued their rulings, Appellees rely on, inter alia , this Court's decisions in Riccio , supra , Ryan v. Berman , 572 Pa. 156, 813 A.2d 792 (2002) (holding coordinate jurisdiction rule did not prevent trial judge from allowing defendants, who were doctors, to amend their pleadings to include a release that the plaintiff had entered into in a separate lawsuit, despite a prior trial judge's denial of the defendants’ previous request to amend their pleadings), and Gerrow v. John Royle & Sons , 572 Pa. 134, 813 A.2d 778 (2002) (holding coordinate jurisdiction rule did not bar second trial judge, in ruling on a motion for summary judgment, from considering an expert report that was attached to the response to the motion, even though prior judge had denied joint motion to extend discovery deadline).
Finally, Appellees argue that, even if the coordinate jurisdiction rule is implicated in the instant case, there are exceptional circumstances that justified Judge Bianco's departure from the rule, i.e. , the fact that Judge Hanna's decision was, in their view, "clearly incorrect," and their belief that adherence thereto would "work a manifest injustice." Appellees’ Brief at 24. In this respect, Appellees contend that a determination that Judge Hanna's ruling was binding on Judge Bianco would conflict with the rule that amendments should be liberally permitted, and prevent them "from asserting their legal right to allege a meritorious defense." Id. at 27.
This Court previously has explained that, under the coordinate jurisdiction rule, "[j]udges of coordinate jurisdiction sitting in the same case should not overrule each others’ decisions." Ryan , 813 A.2d at 795 (quoting Starr , 664 A.2d at 1331 ). Beyond promoting the goal of judicial economy, the coordinate jurisdiction rule serves "(1) to protect the settled expectations of the parties; (2) to insure [sic] uniformity of decisions; (3) to maintain consistency during the course of a single case; (4) to effectuate the proper and streamlined administration of justice; and (5) to bring litigation to an end." Id. (quoting Starr , 664 A.2d at 1331 ).
We have further cautioned that departure from the coordinate jurisdiction rule "is allowed only in exceptional circumstances such as where there has been an intervening change in the controlling law, a substantial change in the facts or evidence giving rise to the dispute in the matter, or where the prior holding was clearly erroneous and would create a manifest injustice if followed." Id. (quoting Starr , 664 A.2d at 1332 ).
Preliminarily, we reject Appellees’ argument that Judge Bianco's order was not "inconsistent" with Judge Hanna's prior ruling, and, therefore, that the coordinate jurisdiction rule is not implicated in this case. Appellees’ Brief at 4. Prior to Judge Bianco's grant of Appellees’ petition to amend their pleadings to include a statute of limitations defense , Judge Hanna, a judge of coordinate jurisdiction, held that Appellees waived the statute of limitations defense by failing to raise it in accordance with Rule 1030. Judge Bianco's decision, which allowed Appellees to amend their pleading to raise the precise defense Judge Hanna held was waived, unquestionably conflicted with Judge Hanna's prior ruling on the same issue. , The fact that Rule 1033 provides a mechanism by which parties may seek leave to amend their pleadings does not, as Appellees suggest, obviate the clear conflict between Judge Hanna's and Judge Bianco's rulings.
In his dissenting opinion, Chief Justice Baer opines that "the inquiry of whether Appellees were entitled to judgment on the pleadings is a distinct legal question from whether Appellees’ motion to amend their pleadings should be granted." Dissenting Opinion (Baer, C.J.) at 523. Respectfully, Chief Justice Baer's position might be justifiable had Appellees not sought permission from Judge Bianco to amend their pleadings specifically to include the statute of limitations defense that Judge Hanna determined was waived. Indeed, we recognize that a trial court generally has discretion to allow parties to amend their pleadings, particularly when such amendment is not prejudicial to the nonmoving party, and our holding is not intended to limit a trial court's discretion in this regard. However, as Appellant observes, the question presently before this Court "is not whether the Trial Court erred in allowing the Appellees to file an amended Answer and New Matter generally," but, rather, "whether the Trial Court erred in allowing the amendment to include the specific affirmative defense that the action was barred by the statute of limitations." Appellant's Brief at 20-21. In granting Appellees permission to amend their pleadings to include the exact defense Judge Hanna had already deemed waived, Judge Bianco implicitly overruled and altered Judge Hanna's ruling.
In a separate dissenting opinion, Justice Mundy suggests that "nothing in Judge Hanna's order precluded Appellees from amending the complaint," noting that "Judge Hanna did not decide the issue of whether Appellees could later amend their answer to include that defense," and "did not declare that the defense was waived with prejudice." Dissenting Opinion (Mundy, J.) at 526. Justice Mundy further expresses concern that our holding is contrary to the principle allowing for the liberal amendment of pleadings. Initially, we note that it is not surprising that Judge Hanna, in declaring Appellees waived the statute of limitations defense, did not address the issue of whether Appellees could later amend their answer to include the defense, or hold that Appellees waived the defense "with prejudice." Why would she? Waiver of an affirmative defense is not a simple defect in a pleading that can be corrected, and we are aware of no requirement that a judge expressly state that a finding of waiver is made "with prejudice" to be considered a final ruling. Further, we reiterate that the issue is not whether Judge Bianco erred in allowing Appellees to file an answer and new matter generally , but, rather, whether he erred in allowing them to amend their pleadings to raise the precise affirmative defense Judge Hanna had previously ruled was waived. Finally, Justice Mundy offers that, because Judge Hanna "would have had the discretion to grant Appellees leave to amend their answer to include a statute of limitations defense, despite her earlier ruling deeming it waived," she "fail[s] to see how the coordinate jurisdiction rule removes that discretion from a subsequent judge in the same procedural posture. " Dissenting Opinion (Mundy, J.) at 527 (emphasis added). Respectfully, not only is this statement inconsistent with her prior position that "the procedural posture of the case and the legal inquiry involved were different when Judge Bianco granted leave to amend than they were when Judge Hanna denied the motion for judgment on the pleadings," see id. at 526 (emphasis added), the purpose of the coordinate jurisdiction rule, for better or for worse, is to prevent "judges of coordinate jurisdiction sitting in the same case from overruling each others’ decisions," unless exceptional circumstances exist. Ryan , 813 A.2d at 795. As discussed below, none of those exceptional circumstances exists in the instant case.
We similarly reject Appellees’ contention that the coordinate jurisdiction rule is not implicated in this case because, at the time the two rulings were issued, the case was at a different procedural posture. As noted above, Appellees rely on, inter alia , this Court's decisions in Riccio , Ryan, and Gerrow . In Riccio , the plaintiff sued his medical insurer to recover medical expenses incurred for the treatment of a herniated spinal disc. The insurer filed an answer asserting that coverage was precluded under a policy exclusion. After a one-day nonjury trial, the trial judge ruled in favor of the insurer. The plaintiff filed a motion for post-trial relief, and the trial judge recused himself due to scheduling conflicts; accordingly, the plaintiff's post-trial motions were assigned to a different judge. The post-trial motions judge concluded that the trial judge had applied an incorrect definition for the term "spine" contained in the policy exclusion, found the exclusion did not apply, and granted the plaintiff a new trial. The Superior Court reversed on appeal, holding that the coordinate jurisdiction rule barred the post-trial motions judge from overruling the trial judge's previous ruling, and disagreeing that the trial judge had applied an incorrect definition of the word spine.
In her concurring and dissenting opinion, Justice Donohue notes her disagreement with both the majority and dissenting opinions "to the extent that they advance the idea that the procedural posture of a case is a relevant consideration in a coordinate jurisdiction rule analysis." Concurring and Dissenting Opinion (Donohue, J.) at 522. As Justice Donohue acknowledges, however, in examining the cases cited by Appellees for this proposition, we emphasized that it was the "exceptional circumstances" that negated the application of the coordinate jurisdiction rule. Id. at 522.
On appeal, this Court explained that, although courts generally should not overrule each other's decisions, in order to determine whether the coordinate jurisdiction rule applies, courts should look to the procedural posture where the conflicting rulings were made. Noting that, under Pa.R.C.P. 227.1(a)(1), a post-trial motions judge can order a new trial if he concludes that a factual or legal mistake was made at the trial level, and that the mistake formed a sufficient basis to order a new trial, we determined that "the post-trial motion process is a clearly distinct procedural posture from that of the trial judge rendering a verdict at the conclusion of a non-jury trial." Riccio , 705 A.2d at 425. We elaborated:
[W]e hold that the coordinate jurisdiction rule does not apply to bar a substituted judge hearing post-trial motions from correcting a mistake made by the trial judge during the trial process. To hold otherwise and not allow a judge deciding post-trial motions to overrule legal errors made during the trial process (whether made by the reviewing judge or another judge who presided over the trial) would render the post-trial motion rules meaningless and the post-trial motion process would become nothing more than an exercise in futility.
Id. at 426 (emphasis added).
Thus, while we held in Riccio that the coordinate jurisdiction rule did not bar the post-trial motions judge from overruling the trial judge's verdict and granting the plaintiff a new trial, our decision was based on the fact that Rule 227.1(a)(1) specifically allows for the correction of errors made during the trial process.
We ultimately concluded in Riccio , however, that the insurance policy at issue did contain a valid exclusion of coverage for the plaintiff's injury, such that the trial judge's interpretation was proper; accordingly, we affirmed the Superior Court's decision reversing the post-trial motions judge's grant of a new trial.
In Ryan , the plaintiff filed a medical malpractice action against her doctors and consulting specialists in 1985, alleging that their failure to diagnose her with Cushing's Syndrome required surgery in 1984 to remove a kidney and an attached tumor. Her complaint also alleged that the disease prolonged and exacerbated a work-related injury that she had suffered in 1982; notably, the plaintiff filed a products liability action in 1984 based on that injury. In 1989, the plaintiff settled the products liability action, and she executed a release of claims for all damages resulting from her work-place injury.
The defendants, upon learning of the release, sought to amend their answers in the malpractice action to include the release, and moved for summary judgment, arguing that the release barred the malpractice action. The first judge to which the case was assigned denied both motions. The defendants filed a motion for extraordinary relief, again seeking to amend their answers to include the release and moving for summary judgment. A different trial judge granted relief, and the plaintiff appealed. The Superior Court reversed, holding the second trial judge's actions were prohibited by the coordinate jurisdiction rule. On remand, the matter was assigned to a third judge for trial. During trial, the defendants again moved to amend their answers to incorporate the release, and the third judge took the matter under advisement. At the close of the plaintiff's case-in-chief, the judge allowed the defendants to amend their answers to include the release, concluding that, while the release did not bar the entire malpractice action against the defendants, it did bar the claims of malpractice alleged to have occurred after the work-related accident.
On further appeal by the plaintiff, the Superior Court affirmed the third judge's order allowing the defendants to amend their answers to include the release executed in the products liability action. However, the Superior Court held that the release barred the plaintiff's malpractice action entirely. We granted review to determine whether the third judge violated the coordinate jurisdiction rule when she overruled the first trial judge's order and allowed the defendants to amend their answers to the plaintiff's complaint to incorporate the plaintiff's release in the products liability case. In holding that she did not, we reasoned:
In this case, as in Riccio , the procedural posture of the case was quite different at the time the two different decisions were made; the [third] judge who presided over the trial was in a superior position to reevaluate the question of the products liability release and its relation to the medical malpractice case than was the [first] pretrial judge who made the initial decision. During the trial of the plaintiff's case-in-chief, abundant evidence was presented which established that [the plaintiff] was seeking damages in this case for injuries suffered in a work-related products liability case; this supported the conclusion that the release in the products liability case barred the damages, or some of them, sought in this case. Thus, under the rationale of Riccio , the rule of coordinate jurisdiction did not apply.
Ryan , 813 A.2d at 795 (emphasis added). Thus, in Ryan , our decision was not based solely on the fact that the decisions were issued at different stages of trial. Rather, as the above language indicates, we relied on the fact that there was new evidence presented at trial that justified the third judge's departure from the coordinate jurisdiction rule. See Starr , 664 A.2d at 1332 (departure from the coordinate jurisdiction rule is permitted when there has been a substantial change in the facts or evidence giving rise to the dispute).
Gerrow also involved a products liability action. Therein, the plaintiffs filed a complaint against several defendants in 1997, and a judge set December 7, 1998, as the deadline for submission of the plaintiffs’ expert reports. Prior to the expiration of the deadline, all parties joined in a motion to extend the discovery deadline, but the motion was denied by the same judge; nevertheless, the parties continued discovery after the deadline. One of the defendants that had joined in the motion to extend discovery recognized that the judge had set January 4, 1999, as the deadline for filing pre-trial motions, and, in order to protect its position, filed a motion for summary judgment. The motion was based on the plaintiffs’ failure to timely submit their expert reports, without which they could not establish a prima facie case. The plaintiffs filed a response to the motion for summary judgment, attaching several expert reports that apparently were sufficient to establish their prima facie case. The motion for summary judgment was assigned to a second judge, who concluded that the plaintiffs’ attachment of expert reports to their response to the defendant's motion was an impermissible attempt to circumvent the discovery deadline. He determined that the rule of coordinate jurisdiction prevented him considering the reports, and he granted the motion for summary judgment. The Superior Court reversed, finding that the plaintiffs’ attachment of the expert reports to their response to the defendants’ summary judgment motion was a permissible supplementation of the record under Pa.R.C.P. 1035.3(b), and, further, that the coordinate jurisdiction rule did not apply under the circumstances of the case.
Rule 1035.3(b), which pertains to a response to summary judgment, provides: "An adverse party may supplement the record or set forth the reasons why the party cannot present evidence essential to justify opposition to the motion and any action proposed to be taken by the party to present such evidence." Pa.R.C.P. 1035.3(b).
This Court, in an Opinion Announcing the Judgment of the Court, affirmed the Superior Court's decision, concluding, inter alia , that the coordinate jurisdiction rule did not preclude the second trial judge from considering the expert reports which were filed after the case management deadline established by the first judge for two reasons. First, we found that the first judge's decision was erroneous and created a manifest injustice. See Starr , 664 A.2d at 1332 (departure from the coordinate jurisdiction rule is permitted "where the prior holding was clearly erroneous and would create a manifest injustice if followed"). In this regard, we stated:
[I]t appears erroneous in the first instance for [the first judge] to deny the November 23, 1998 motion to extend the discovery deadline. The motion was joined by all parties. It was based on the necessity of extensive traveling to depose witnesses in several states, as well as a financial crisis faced by one corporate defendant. All parties were aware of these difficulties and believed they justified extension of the discovery timetable. [The first judge] did not permit hearing, argument, or conference on the motion and, in summarily denying it, gave no rationale for the denial. There is thus no basis for this Court to review his discretion in denying the motion. What appears to be an unreasonable decision has no explanation in the record, and the decision appears to be unjust. It would have been perfectly proper for [the second judge] to reexamine the discovery timetable in order to correct that error. That would have served the ends of judicial economy and might have corrected a manifest injustice.
Gerrow , 813 A.2d at 782.
We further held that the coordinate jurisdiction rule did not apply because the two judges were presented with different questions:
[The first judge] had been presented with a scheduling issue affecting case management and the court's timetable. [The second judge], by contrast, was faced with the ultimate question of whether summary judgment should be granted, ending the litigation entirely. The considerations were entirely different, so the coordinate jurisdiction rule did not apply in the sense of precluding an examination of Appellees’ expert reports to determine whether they established a prima facie case, making summary judgment inappropriate.
Id. at 783.
As in Ryan , our decision in Gerrow was not based on the mere fact that the conflicting decisions were issued at different stages of trial. Rather, we specifically determined that the decision of the first judge was erroneous, and created a manifest injustice. We additionally noted that the considerations underlying both decisions were entirely distinct.
In the instant case, following Appellees’ February 2015 motion for judgment on the pleadings wherein they asserted that Appellant lacked standing and that her claim was barred by the statute of limitations, Judge Hanna held that (1) Appellant lacked standing; and (2) Appellees waived the statute of limitations defense by failing to raise it as a new matter in their answer under Pa.R.C.P. 1030(a). Judge Bianco's decision more than three years later allowing Appellees to amend their pleadings to include the statute of limitations defense unquestionably was inconsistent with Judge Hanna's prior ruling, and altered the legal effect thereof. Although the Superior Court suggested that the rulings were not inconsistent because Appellees did not ask Judge Bianco to overturn Judge Hanna's finding that they waived the statute of limitations defense, but, rather, merely requested that Judge Bianco consider "whether [Appellant] would be prejudiced by the delay in raising the statute of limitations defense," Rellick-Smith , 919 WDA 2019, at 7, we are unpersuaded by this logic. The question of whether Appellant would be prejudiced if Appellees were permitted to amend their pleadings to include the statute of limitations defense is relevant only if the trial court was in a position to grant the request. As discussed above, because Judge Bianco's order granting Appellees’ request for amendment of their pleadings altered the effect of Judge Hanna's prior ruling by undoing her finding that Appellees had waived the statute of limitations defense, Judge Bianco's order violated the coordinate jurisdiction rule, unless one of the limited exceptions to the rule applies. Upon review, we discern no such applicable exception.
It is this fact that renders Judge Bianco's reliance on Horowitz misplaced. The issue in Horowitz was whether the trial court erred in denying a petition to amend an answer to a complaint to include the affirmative defense of statute of limitations where the petition was filed more than four years after the filing of the original answer. The Superior Court in Horowitz determined that the trial court should have permitted the amendment because it would not violate a positive rule of law, and there was no evidence that the non-moving party would suffer undue prejudice if the amendment was allowed. Critically, however, the trial court in Horowitz was not constrained by any prior ruling on the party's petition to amend its pleading, and the coordinate jurisdiction rule was not at issue.
First, unlike the first judge's order in Gerrow , Judge Hanna's ruling was not erroneous. Rule 1030(a) of the Pennsylvania Rules of Civil Procedure requires that, with certain exceptions not relevant herein, all affirmative defenses, including but not limited to the defenses of statute of limitations, "shall be pleaded in a responsive pleading under the heading ‘New Matter’." Pa.R.C.P. 1030(a). Rule 1032(a) further provides that, with the exception of certain expressly enumerated defenses, which do not include the defense of statute of limitations, "[a] party waives all defenses and objections which are not presented either by preliminary objection, answer or reply." Pa.R.C.P. 1032(a). The fact that Rule 1033 provides a mechanism by which parties may subsequently seek leave to amend their pleadings does not render Judge Hanna's initial ruling, issued more than three years before Appellees sought permission to amend their pleading, erroneous. Moreover, Appellees do not offer, and our review of the record does not reveal, any intervening change in the controlling law, or, as was the case in Ryan , any substantial change in the facts or evidence. Appellant filed her complaint against Appellees in October 2014, and although Appellees undoubtedly were aware of the potentially viable statute of limitations defense within several months, they failed to raise the defense as a new matter in their answer to Appellant's complaint, as required by Pa.R.C.P. 1030(a), instead asserting the defense for the first time in their February 2015 motion for judgment on the pleadings. Appellees do not point to any change in the facts or evidence between June 2015, when Judge Hanna ruled that Appellees waived the statute of limitations defense, and July 2018, when they filed their motion with Judge Bianco seeking to amend their answer to include that defense, that would support Judge Bianco's decision to disregard Judge Hanna's prior ruling.
In her concurring and dissenting opinion, Justice Donohue opines that, in light of the "well established rule that motions to amend should be liberally granted," Judge Hanna's "refusal to allow the Appellees to amend their answer to raise the statute of limitations as an affirmative defense was clearly erroneous." Concurring and Dissenting Opinion (Donohue, J.) at 521. To reach this conclusion, Justice Donohue relies on several Superior Court cases to suggest that Appellees’ motion for judgment on the pleadings filed with Judge Hanna should have been construed as the "equivalent to a motion to amend," and, further, that, by refusing to consider the statute of limitations defense, Judge Hanna denied the motion to amend. Id. at 520–21. Respectfully, this Court did not accept review of this case to opine on this procedural issue or the validity of the line of Superior Court caselaw on which she relies.
For the above reasons, we find there was no basis for Judge Bianco to disturb Judge Hanna's holding that Appellees waived the statute of limitations defense. Accordingly, we reverse the decision of the Superior Court, vacate the portion of Judge Bianco's order granting Appellees’ motion to amend their pleadings to include a statute of limitations defense, and remand the matter to the trial court for further proceedings consistent with this opinion.
Superior Court decision reversed. Case remanded. Jurisdiction relinquished.
Justices Dougherty and Wecht join the Opinion Announcing the Judgement of the Court.
Justice Donohue files a concurring opinion.
Chief Justice Baer files a dissenting opinion in which Justices Saylor and Mundy join.
Justice Mundy files a dissenting opinion in which Justice Saylor joins.
JUSTICE DONOHUE
Although I agree with the Opinion Announcing the Judgment of the Court ("OAJC") that the coordinate jurisdiction rule applies in this case such that Judge Bianco, the second trial judge assigned to this matter, was precluded from allowing the Appellees to amend their answer to assert a statute of limitations defense, I reach that conclusion for reasons different than those expressed by the OAJC.
At the outset, it must be recognized that poor pleading practice permeated this case, and in large part, these missteps and the efforts made to overlook them coalesced to bring the question at issue in this appeal before the Court. The errors begin with the Appellees, the defendants in the trial court, filing a motion to dismiss; a motion that does not exist in Pennsylvania's civil practice. Judge Hanna disposed of this motion without comment on the anomaly by finding that the plaintiff, Appellant here, lacked standing to bring the lawsuit and that the statute of limitations defense was waived for failure to plead it as new matter. Trial Court Op., 6/22/2015, at 3 & n.3. On appeal from the standing ruling, in an attempt to shoehorn this procedural anomaly into established civil procedure, the Superior Court treated the motion as if it were preliminary objections. See Rellick-Smith v. Rellick , 147 A.3d 897, 900 n.9 (Pa. Super. 2016) ("The Motion to Dismiss was essentially in the form of a preliminary objection; we will treat it as such."). Back before the trial court, the Appellees again attempted to raise the statute of limitations defense by filing a motion to amend their answer to raise the statute of limitations as a defense, four years later and on the eve of trial. The allowance of that amendment brought the case before the Superior Court once again and ultimately before this Court, where the OAJC, as well as Chief Justice Baer and Justice Mundy in their dissenting opinions, rebrand the Appellees’ problematic initial filing as a motion for judgment on the pleadings. I agree that the problematic filing is properly characterized as a motion for judgment on the pleadings, but the OAJC and the dissenting voices here fall short of registering the full effect that this motion for judgment on the pleadings has on the disposition of the case.
Appellees, too, have recognized that a motion to dismiss is not recognized in this jurisdiction's civil practice and that the filing would have rightly been called a motion for judgment on the pleadings. Appellees’ Brief at 3 n.2. Although improperly designated by the Appellees, because the motion was filed after the close of the pleadings and it sought a dispositive ruling, it is properly deemed to be a motion for judgment on the pleadings. See Pa.R.C.P. 1034.
The OAJC seems to equate prejudice with success on the merits. However, in these circumstances, prejudice should be evaluated based upon the effect the passage of time has had on the new allegations. This Court has explained this concept in the following terms.
Despite our liberal policy of allowing amendments to pleadings, an amendment will not be permitted if it would result in undue prejudice to the pleader's opponent. Professor Fleming James, Jr., of Yale Law School has given an accurate and succinct description of the concept of prejudice in this context:
All amendments have this is [in] common: they are offered Later in time than the pleading which they seek to amend. If the amendment contains allegations which would have been allowed inclusion in the original pleading (the usual case), then the question of prejudice is presented by the Time at which it is offered rather than by the substance of what is offered. The possible prejudice, in other words, must stem from the fact that the new allegations are offered Late rather than in the original pleading, and not from the fact that the opponent may lose his case on the merits if the pleading is allowed[.]
Bata v. Cent.-Penn Nat. Bank of Philadelphia , 448 Pa. 355, 293 A.2d 343, 356-57 (1972).
The OAJC belittles this point by suggesting that a deemed waiver of an affirmative defense, based solely on the failure to plead it, has a preclusive effect on a party's ability to later amend the answer to include that affirmative defense. OAJC at 514 n.6. The OAJC's position that a pleading defect can operate as a final waiver of an affirmative defense is not, and has never been, the law in Pennsylvania, as discussed herein.
The OAJC suggests that my approach addresses a procedural issue that exceeds the scope of the question before the Court. See OAJC at 518-19 n.11. Although I address the procedural steps of this matter in the trial court, I do so only as a means of placing the issue before us within the framework of Pennsylvania's civil practice, which provides the context for its resolution.
The OAJC selectively quotes a portion of this sentence to suggest my position is inconsistent. OAJC at 514 n.6. However, my point is that the subsequent judge, Judge Bianco, was in the same procedural posture as Judge Hanna would have been if she had evaluated the motion to amend the answer, which is a different procedural posture than she was in while deciding the motion for judgment on the pleadings. Because Judge Hanna would have discretion to grant leave to amend, despite her earlier ruling deeming the defense waived, the subsequent judge also must have that discretion. See Puleo , 407 A.2d at 396.
The issue before the Court asks whether Judge Bianco's order permitting Appellees to amend their answer and raise the statute of limitations as a defense violated the coordinate jurisdiction rule. To answer that question, it is imperative that we establish precisely as to what each jurist ruled. The procedural history establishes that Rellick-Smith filed a complaint and Appellees filed an answer, in which they did not raise any affirmative defenses. See Complaint, 10/10/2014; Answer to Complaint, 10/22/2014. Subsequently, Appellees filed their motion for judgment on the pleadings (mischaracterized as a "motion to dismiss"), in which they raised the statute of limitations for the first time as a basis for judgment in their favor. Motion to Dismiss, 2/11/2015, ¶ 6.
Longstanding and sound precedent from our intermediate appellate courts makes clear that raising an affirmative defense in a dispositive motion outside of the pleading cycle is treated as a motion to amend the pleadings. When an affirmative defense that was not properly pled as new matter but subsequently raised in a motion for judgment on the pleadings and is considered by the trial court, the trial court's consideration thereof is treated as the approval of an amendment under Rule of Civil Procedure 1033. Flora v. Moses , 727 A.2d 596, 599 (Pa. Super. 1999) (citing Meridian Oil & Gas Enter., Inc. v. Penn Cent. Corp. , 418 Pa.Super. 231, 614 A.2d 246, 250 (1992) ); see also Paravati v. Port Auth. of Allegheny Cty ., 914 A.2d 946, 952 (Pa.Cmwlth. 2006) ("It has been held ... that where a party raises a statutory affirmative defense at a later stage of the proceedings and the trial court considers it, the consideration is treated as approving an amendment under Pa. R.C.P. No. 1033."). Stated another way, an affirmative defense raised, not in a responsive pleading but at a later stage of a case, is treated as a request to amend its answer to assert that defense. Flora , 727 A.2d at 599 ("The court's consideration of the ... defense upon a motion for judgment on the pleadings equates to an approval of an amendment to the pleadings.").
This case presents the correlative situation: when a party raises an affirmative defense for the first time in a dispositive motion after the close of pleadings and the trial court refuses to consider it because of the pleading failure, is the refusal a denial on a motion to amend? The answer must be yes. Raising the defense out of time in a dispositive motion is either the equivalent to a motion to amend or it is not. There is no principled reason to treat differently the out-of-sequence raising of the affirmative defense as a motion to amend based on the trial court's decision on the merits of allowing or disallowing the amendment. Here, Appellees raised the statute of limitations defense for the first time in the motion for judgment on the pleadings. Judge Hanna could have considered the statute of limitations in deciding the dispositive motion. If she had done so, the answer would have been amended. Instead, Judge Hanna refused to consider the affirmative defense, finding it waived based on the Appellees’ failure to plead it in new matter. Judge Hanna's ruling was thus a denial of the motion to amend.
I reiterate that I focus on these procedural rigors as a means of placing the issue before the Court in the proper context. To that end, and consistent with my chosen framework, I note that no party suggests that Judge Hanna could not have entertained the statute of limitations defense when it was belatedly raised, and the OAJC tacitly acknowledges as much in its conclusion that her decision not to consider it was not an abuse of discretion. See OAJC at 518.
Viewed in the appropriate context, there is no question that the second trial judge in this case was asked to do precisely what Judge Hanna refused to do: allow an amendment of the Appellees’ answer to raise the affirmative defense of the statute of limitations. And by granting the motion to amend, he altered Judge Hanna's determination that the defense was waived. The coordinate jurisdiction rule provides that where a case is transferred between judges of coordinate jurisdiction, a subsequent jurist should not alter the determination of a prior jurist. Zane v. Friends Hosp. , 575 Pa. 236, 836 A.2d 25, 29 (2003). The rule acts "to protect the expectations of the parties, to insure uniformity of decisions, to maintain consistency in proceedings, to effectuate the administration of justice, and to bring finality to the litigation." Id. In service of these goals, the coordinate jurisdiction rule is subject to exception only in "exceptional circumstances," such as 1) where there is an intervening change in the controlling law, 2) a substantial change in the facts or evidence giving rise to the dispute, or 3) where the prior holding was clearly erroneous and would create a manifest injustice if followed. Commonwealth v. Starr , 541 Pa. 564, 664 A.2d 1326, 1332 (1995).
The only recognized exceptional circumstance that is potentially applicable in this case is the third: the prior holding was clearly erroneous and would create a manifest injustice if followed. Given our well-established rule that motions to amend should be liberally granted, Noll v. Harrisburg Area YMCA , 537 Pa. 274, 643 A.2d 81, 84 (1994), Judge Hanna's refusal to allow the Appellees to amend their answer to raise the statute of limitations as an affirmative defense was clearly erroneous. However, in this case, following Judge Hanna's ruling would not create a manifest injustice. The Appellees waited four years and until the eve of trial to attempt to again raise the defense. As developed by Rellick-Smith, the passage of time impacted her ability to reconstruct the circumstances impacting facts required under the discovery rule since much depended on the memory of witnesses. See Rellick-Smith's Brief at 22-23. Moreover, given the inordinate delay in attempting again to raise the defense, no manifest injustice would ensue if the parties were required to try their cases on the merits and based on the evidence developed over many years of litigation in this case. Thus, in my view, the coordinate jurisdiction rule prohibited Judge Bianco from altering Judge Hanna's decision that the statute of limitations defense was waived and no exceptional circumstances exist to support an exception to the application of the coordinate jurisdiction rule.
In fairness to Judge Hanna, she may have decided that in light of her conclusion that the Appellees lacked standing, the statute of limitations defense was irrelevant to her disposition. However, this is not what she ruled. Instead, she found waiver and did not allow the defense to be raised.
Further, I disagree with both the OAJC and the Dissenting Opinions to the extent that they advance the idea that the procedural posture of a case is a relevant consideration in a coordinate jurisdiction rule analysis. See OAJC at 516 ("Thus, in Ryan , our decision was not based solely on the fact that the decisions were issued at different stages of trial."); Dissenting Op. (Baer, C.J.) at 525; Dissenting Op. (Mundy, J.) at 525-26. Our precedent teaches that the application of the rule may incidentally be impacted by the procedural posture but only to the extent that a different procedural posture resulted in the development of additional evidence and facts impacting the case between the rulings, or another "exceptional circumstance" existed.
In its discussion of the cases cited by Appellees for the proposition that the procedural posture of a case impacts the application of the coordinate jurisdiction rule, Riccio v. American Republic Insurance Company , Ryan v. Berman , and Gerrow v. John Royle & Sons , the OAJC recognizes that it was not the differing procedural posture alone that took these cases outside of the coordinate jurisdiction rule. See OAJC at 513-17. As the OAJC identifies, present in each case is one of the "exceptional circumstances" that remove a matter from the application of the coordinate jurisdiction rule. In Riccio , we found that the first trial court's holding, which ignored the purpose and effect of Pa.R.C.P. 227.1(a)(1) (governing post-trial motions), was clearly erroneous and to allow it to stand would cause the injustice of preventing effective post-trial proceedings. Riccio v. Am. Republic Ins. Co. , 550 Pa. 254, 705 A.2d 422, 425-26 (1997). The lead opinion in Gerrow reveals two bases for the conclusion that the coordinate jurisdiction did not apply, the first of which was an erroneous ruling by the first jurist, which was "unreasonable" to a point of becoming a "manifest injustice," thereby satisfying Starr ’s requirement of an exceptional circumstance that renders the coordinate jurisdiction rule inapplicable. Gerrow v. John Royle & Sons , 572 Pa. 134, 813 A.2d 778, 782-83 (2002) (plurality). In Ryan , "abundant" evidence was presented between the first and second rulings so as to remove the matter from the application of the coordinate jurisdiction rule. Ryan v. Berman , 572 Pa. 156, 813 A.2d 792, 795 (2002).
The second basis was the difference in procedural posture at the time. Gerrow v. John Royle & Sons, 572 Pa. 134, 813 A.2d 778, 782-83 (2002) (plurality).
The "exceptional circumstances" in these cases are what negated the applicability of the coordinate jurisdiction rule; the change in their procedural postures was irrelevant. In some cases, the procedural posture may be different, but it is not a dispositive factor. It is not unusual for a court to overrule the prior ruling of a court of coordinate jurisdiction when there has been no advancement in the procedural posture, so long as there is an intervening circumstance (such as a change in the evidence or legal authority) that compel a different conclusion. See, e.g. , Nobles v. Staples, Inc. , 150 A.3d 110, 119 (Pa. Super. 2016) ("[A] trial court may reconsider a summary judgment motion, already decided by a colleague of the same court when the motion contains new evidence or facts of record."); Elec. Lab. Supply Co. v. Cullen , 712 A.2d 304, 307 (Pa. Super. 1998) (holding second judge's grant of summary judgment proper despite prior judge's denial of summary judgment because second judge was presented with new evidence when deciding the motion).
In Riccio , this Court stated that when determining whether the coordinate jurisdiction rule applies, "this Court looks to where the rulings occurred in the context of the procedural posture of the case." Riccio , 705 A.2d at 425. This statement is a recognition that a different procedural posture reflects the progression of a case which may give rise to exceptional circumstances making the coordinate jurisdiction rule inapplicable. To read this otherwise is to suggest, for example, the following. A party files an unsuccessful motion for judgment on the pleadings. Immediately thereafter, without a change in the law or engaging in any discovery to further develop the evidence, the same party files a motion for summary judgment on the same basis as the prior motion. If the procedural posture controls the applicability of the coordinate jurisdiction rule, a new judge could grant the summary judgment motion. This is decidedly impossible under the coordinate jurisdiction rule. The sum of our precedent establishes that the coordinate jurisdiction rule applies regardless of the procedural posture of the case unless there has been a change in the law, a change in the facts or the initial ruling was clearly erroneous and following it creates a manifest injustice.
Returning to the case presently before us, I conclude that Judge Hanna's ruling on Appellees’ motion for judgment on the pleadings was a denial of a request to amend their answer. For Judge Bianco to entertain a subsequent motion to amend, the Appellees were required to establish that the ruling was clearly erroneous and following it would create manifest injustice. Here, although Judge Hanna's ruling was clearly erroneous, no manifest injustice is created by following it. Thus, Judge Bianco was bound by it.
For these reasons, I concur in the result reached by the OAJC.
CHIEF JUSTICE BAER
Unlike the Opinion Announcing the Judgment of the Court ("OAJC"), I conclude that the coordinate jurisdiction rule did not preclude the trial court from granting Appellees’ motion to amend their pleadings to include, inter alia , a statute-of-limitations defense. I reach this conclusion because, in my view, the inquiry of whether Appellees were entitled to judgment on the pleadings is a distinct legal question from whether Appellees’ motion to amend their pleadings should be granted. Because I believe that the Superior Court came to the correct result, I would affirm that court's judgment.
As the OAJC accurately explains, Appellant filed her complaint against Appellees in October of 2014. Four months after Appellant filed her complaint, Appellees filed a motion for judgment on the pleadings seeking to have the trial court dismiss the complaint on the grounds that Appellant lacked standing and that the action was barred by the statute-of-limitations. The then-presiding judge, the Honorable Carol Hanna, determined that Appellees waived their statute-of-limitations defense by failing to include it in their new matter. See Pa.R.C.P. 1030(a) (stating that all affirmative defenses must be pleaded as new matter). Judge Hanna nevertheless granted Appellees’ motion, as she agreed with them that Appellant lacked standing.
After Appellant successfully appealed Judge Hanna's order to the Superior Court, which held that Appellant had standing to proceed, the case was remanded to the trial court and eventually transferred to the Honorable Thomas Bianco. In July of 2018, Appellees, with the assistance of new counsel, filed a motion seeking to amend their answer to plead new matter, including a statute-of-limitations defense. Judge Bianco granted Appellees’ motion; Appellees subsequently filed their amended pleadings; and Judge Bianco ultimately entered an order finding that Appellant's cause of action is barred by the statute of limitations.
On appeal, the Superior Court rejected Appellant's contention that Judge Hanna's conclusion that Appellees waived their statute-of-limitations defense prohibited Judge Bianco from allowing Appellees to amend their pleadings to include a statute-of-limitations defense. Contrary to the Superior Court's decision, the OAJC holds that the coordinate jurisdiction rule precluded Judge Bianco from granting Appellees’ motion to amend their pleadings. For the reasons that follow, I respectfully disagree.
The coordinate jurisdiction rule is straightforward. "Generally, the coordinate jurisdiction rule commands that upon transfer of a matter between trial judges of coordinate jurisdiction, a transferee trial judge may not alter resolution of a legal question previously decided by a transferor trial judge." Zane v. Friends Hosp. , 575 Pa. 236, 836 A.2d 25, 29 (2003). "More simply stated, judges of coordinate jurisdiction should not overrule each other's decisions." Id.
Here, Judge Hanna was asked to rule on Appellees’ motion for judgment on the pleadings to determine, as relevant to this appeal, whether Appellees clearly were entitled to judgment based upon the averments in the pleadings on the basis that Appellant's claims were barred by the statute of limitations. See Travelers Cas. & Sur. Co. v. Castegnaro , 565 Pa. 246, 772 A.2d 456, 459 (2001) (explaining that "[j]udgment on the pleadings is proper only where the pleadings evidence that there are no material facts in dispute such that a trial by jury would be unnecessary"). Judge Hanna answered this question in the negative, concluding that, in effect, the pleadings were insufficient to grant Appellees judgment because they failed to plead their statute-of-limitations defense under new matter, in violation of Pa.R.C.P. 1030(a).
Appellees presented Judge Bianco with an entirely different query. Judge Bianco was asked whether Appellees should be permitted to amend their pleadings to include a statute-of-limitations defense in light of the potential prejudice that this amendment may cause Appellant. See Robinson Protective Alarm Co. v. Bolger & Picker , 512 Pa. 116, 516 A.2d 299, 302 n.6 (1986) (noting that "it has been firmly established that the right to amend a pleading is a matter of judicial discretion and should be liberally granted at any stage of a proceeding unless it constitutes surprise which results in prejudice to an adverse party, or the grant thereof constitutes an error of law"). In support of his decision to grant Appellees’ motion to amend their pleadings, Judge Bianco expressly determined that Appellant was not prejudiced by the amendment to Appellees’ pleadings. Trial Court Opinion, 3/26/2019, at 5-8. In my view, this series of events makes clear that Judge Bianco did not alter or overrule Judge Hanna's conclusion that Appellees were not entitled to judgment on the pleadings because they waived their statute-of-limitations defense by failing to include it in the pleadings under examination at that point in the proceedings. Rather, Judge Bianco addressed the discrete issue of whether Appellees should be permitted to amend their pleadings. Thus, I agree with the Superior Court insomuch as that court concluded that the coordinate jurisdiction rule did not preclude Judge Bianco from granting Appellees’ motion to amend their pleadings.
To be clear, reasonable minds may differ as to whether Judge Bianco appropriately exercised his discretion by granting Appellees’ motion to amend. See id. ("When reviewing a trial court's ruling on a party's petition to amend we must bear in mind that the trial court is granted broad discretion in evaluating amendment petitions."). For example, on the one hand, the three-judge panel of the Superior Court found that Judge Bianco did not abuse his discretion by granting the motion to amend based upon the perceived absence of a more specific showing of prejudice to Appellant. Rellick-Smith v. Rellick , 229 A.3d 390 (Pa. Super. 2020) (unpublished memorandum at 7-8). On the other hand, the OAJC, in essence, concludes that the Judge Bianco abused his discretion by granting Appellees’ motion to amend because Appellant necessarily was prejudiced by the amendment to Appellees’ pleadings. OAJC at 517 ("Indeed, we fail to see how a plaintiff who has received the benefit of a ruling that a defendant waived a statute of limitations defense would not be prejudiced if the defendant subsequently was permitted by a different judge to amend their pleadings to raise that precise defense.").1 While I appreciate the varying views of Judge Bianco's exercise of discretion in granting the motion to amend, I do not believe that the issue upon which we granted allowance of appeal encompasses a review of that part of Judge Bianco's decision-making process.
Justices Saylor and Mundy join this dissenting opinion.
JUSTICE MUNDY
I join Chief Justice Baer's dissenting opinion. I write separately to emphasize that Judge Hanna's order denying the motion for judgment on the pleadings did not preclude Appellees from amending their complaint to correct the pleading error. Further, I have concerns about the implications the Opinion Announcing the Judgement of the Court's (OAJC) holding will have on Pennsylvania's liberal amendment standard.
I agree with Chief Justice Baer that the coordinate jurisdiction rule does not apply in this case because the procedural posture of the case and the legal inquiry involved were different when Judge Bianco granted leave to amend than they were when Judge Hanna denied the motion for judgment on the pleadings. Additionally, I add that nothing in Judge Hanna‘s order precluded Appellees from amending the complaint. Instead, Judge Hanna deemed waived, for purposes of deciding the motion for judgment on the pleadings, the affirmative defense of the statute of limitations because Appellees did not plead that defense in their answer. Trial Ct. Op., 6/22/15, at 3 (Hanna, J.) (stating Appellees’ "failure to raise a statute of limitations defense within their answer filed on October 22, 2014 is deemed a waiver."); accord Pa.R.C.P. 1032. Judge Hanna did not decide the issue of whether Appellees could later amend their answer to include that defense. Further, Judge Hanna did not declare that the defense was waived with prejudice, merely that it was "deemed a waiver" at the stage of judgment on the pleadings.1
Additionally, reading Judge Hanna's order as denying Appellees the ability to subsequently amend their pleadings is not consistent with Pennsylvania law, which liberally permits amendments that are not prejudicial to the opposing party. Pennsylvania Rule of Civil Procedure 1033 provides that a party may amend a pleading at any time with consent of the adverse party or by leave of court. Pa.R.C.P. 1033(a). Further, "[t]he amended pleading may aver transactions or occurrences which have happened before or after the filing of the original pleading, even though they give rise to a new cause of action or defense. An amendment may be made to conform the pleading to the evidence offered or admitted." Id. This Court has recognized that "[l]eave to amend lies within the sound discretion of the trial court and the right to amend should be liberally granted at any stage of the proceedings unless there is an error of law or resulting prejudice to an adverse party." Werner v. Zazyczny , 545 Pa. 570, 681 A.2d 1331, 1338 (1996) (internal citation and quotation marks omitted). Further, our intermediate appellate courts have consistently concluded that "[p]leadings may be amended at the discretion of the trial court after pleadings are closed, while a motion for judgment on the pleadings is pending, at trial, after judgment, or after an award has been made and an appeal taken therefrom." Biglan v. Biglan , 330 Pa.Super. 512, 479 A.2d 1021, 1025-26 (1984) ; see also, e.g. , Newcomer v. Civil Serv. Comm'n of Fairchance Borough , 100 Pa.Cmwlth. 559, 515 A.2d 108, 111 (1986). This Court has explained that the purpose of Rule 1033 is "to prevent the case from turning on purely technical objections." Keller v. R.C. Keller Motor Co. , 386 Pa. 56, 124 A.2d 105, 106 (1956) ; see also Wm. Penn Parking Garage, Inc. v. City of Pittsburgh , 464 Pa. 168, 346 A.2d 269, 278 (1975) ("hyper-technicality and formalism in pleading [are] contrary to the modern practice of allowing free amendment in order to promote resolution of cases in [sic] their merits."). Additionally, the Superior Court has held that even after a trial court grants judgment on the pleadings on the basis that the statute of limitations barred the action, it should give the opposing party an opportunity to amend its pleadings to avoid the statute of limitations. Puleo v. Broad St. Hosp. , 267 Pa.Super. 581, 407 A.2d 394, 396 (1979).
The OAJC holds that, under the coordinate jurisdiction rule, Judge Hanna's ruling that Appellees’ statute of limitations defense was deemed waived precluded a second trial judge from granting leave to amend to correct the defective pleading. This undermines the liberal amendment standard engrained in Pennsylvania jurisprudence. Based on Rule 1033 and the cases applying it discussed above, it is clear that Judge Hanna would have had the discretion to grant Appellees leave to amend their answer to include a statute of limitations defense, despite her earlier ruling deeming it waived. If Judge Hanna retained that discretion, I fail to see how the coordinate jurisdiction rule removes that discretion from a subsequent judge in the same procedural posture.2 To conclude that one trial judge may permit leave to amend after deeming a defense waived based on a pleading defect, but a judge of coordinate jurisdiction cannot grant leave to amend in the same situation gives a windfall to litigants whose case has been reassigned. Further, I am concerned that the OAJC's holding could be readily applied to cases involving only one trial judge such that once a trial judge decides preliminary objections, or a motion for judgment on the pleadings, or a motion for summary judgment, that judge is precluded from granting leave to amend in a manner that would "overrule" the prior decision. This would encourage the "hyper-technicality and formalism in pleading" that Rule 1033 ’s liberal amendment standard was enacted to prevent. Wm. Penn Parking Garage , 346 A.2d at 278. Accordingly, I dissent.
Justice Saylor joins this dissenting opinion.