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HomeMy WebLinkAbout03-5294 BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. 482117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates 946 Lincoln Way East Chambersburg, PA 17201 Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc. 1132 Kennebec Dri ve Chambersburg, PA 17201, and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201 Defendants Attorneys for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03 - S?4y C o l-? NOTICE You have been sued in Court. If you wish to defend against the claims set forth in the following pages, you must take action within twenty (20) days after this Complaint and notice are served, by entering a written appearance personally or by attorney and filing in writing with the court your defense or objections to the claims set forth against you. You are warned that if you fail to do so the case may proceed without you and a judgment may be entered against you by the Court without further notice for any money claimed in the complaint or for any other claim or relief requested by the Plaintiff. You may lose money or property or other rights important to you. YOU SHOULD TAKE THIS NOTICE TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER. IF YOU CANNOT AFFORD TO HIRE A LAYWER, THIS OFFICE MAY BE ABLE TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL SERVICES TO ELIGIBILE PERSONS AT A REDUCED FEE OR NO FEE. Cumberland County Bar Association 32 South Bedford Street Carlisle, PA 17013 Phone (717-249-3166) BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates 946 Lincoln Way East Chambersburg, PA 17201 Plaintiff Attorneys for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS C17VIL ACTION - LAW V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 1720 1, and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201 Defendants DOCKET NO.: O3 _ j.2 9y C'ic,, i C'zn COMPLAINT Plaintiff, Shank and Associates Real Estate, Inc„ d/b/a The Prudential Franklin Associates (hereinafter "Plaintiff') by and through their undersigned counsel, Blair H. Granger & Associates, P.C., state the following: Parties And Jurisdiction Plaintiff is a Pennsylvania Corporation licensed to do business in the Commonwealth of Pennsylvania as a real estate broker and maintains a place of business at the address in the above caption and under the authorized fictitious name of "The Prudential Franklin Associates". Defendant, Re/Max Realty Agency, Inc. (hereinafter "ReMax") is a Pennsylvania Corporation licensed to do business in the Commonwealth of Pennsylvania and maintains a place of business at the address set forth in the caption. Defendant, Craig Shellhase (hereinafter "Schellhase"), is an individual and a licensed real estate salesperson and at all material times hereto, an agent of defendant Re/Max with an address set forth in the caption. 4. Defendant, Jeffrey L. Shatzer (hereinafter "Shatzer"), is an individual and a licensed real estate salesperson and at all material times hereto, an agent of defendant Re/Max with an address set forth in the caption. 5. Defendant, Samuel C. Small (hereinafter "Small"), is an individual and a licensed real estate broker with defendant Re/Max, the President of defendant Re/Max, and at all material times hereto, an agent of defendant Re/Max with an address set forth in the caption. 6. Defendant, Steven B. Spray (hereinafter "Spray"), is an individual and a licensed real estate associate broker with defendant Re/Max, the Secretary of defendant Re/Max, and at all material times hereto, an agent of defendant Re/Max with an address set forth in the caption. At all times material hereto, defendant Re/Max conducted and does conduct business in Cumberland County. Allegations 8. Pursuant: to the Pennsylvania Real Estate Licensing and Registration Act ("RELRA"), no salesperson shall be employed by any other broker than is designated upon the current license issued to said salesperson. 63 P.S. 455.603(a). 9. On or about September 23, 1999, Plaintiff and defendant Schellhase entered into a Broker-Sales Associate Independent Contractor Agreement (hereinafter "Associate Contract) for Schellhase to act as a Sales Associate for Plaintiff. A copy of the Agreement is attached and incorporated herein as Exhibit "A". 10. On or about May 20, 1997, Plaintiff and defendant Shatzer entered into a Broker- Sales Associate Independent Contractor Agreement (hereinafter "Associate Contract) for Shatzer to act as a Sales Associate for Plaintiff. A copy of the Agreement is attached and incorporated herein as Exhibit "B". 11. Under the Associate Agreements, defendants Schellhase and Shatzer were required to list all properties through Plaintiff and otherwise promote the business of Plaintiff. 12. On July 21, 2003, defendant Schellhase provided correspondence to Arnold Shank, President of Plaintiff, terminating his relationship with Plaintiff effective immediately and indicating that he was transferring his (real estate) license to defendant Re/Max. A copy of said correspondence is attached and incorporated herein as Exhibit "C". 13. On February 28, 2003, defendant Shatzer provided correspondence to Arnold Shank, President of Plaintiff, terminating his relationship with Plaintiff indicating that he was transferring his (real estate) license to defendant Re/Max effective March 3, 2003. A copy of said correspondence is attached and incorporated herein as Exhibit "D". 14. Defendant Re/Max is a competitor of Plaintiff. 15. It is believed and averred that while under the Associate Contracts with Plaintiff, defendant Schellhase and Shatzer were actively working with or for defendant Re/Max in direct competition with Plaintiff as more fully set forth herein. 16. On or about June 23, 2003, defendant Schellhase listed a property located at 3306 Scotland Road, Chambersburg, PA 17201, even though defendant Schellhase did not tender his resignation with Plaintiff until July 21, 2003. A copy of the Agent Synopsis Report for this property dated September 4, 2003 is attached and incorporated herein as Exhibit "E". 17. According to Exhibit "E", the Scotland Road property was listed on June 23, 2003 and identifies defendant Schellhase as the Listing agent and defendant Spray as the Show Contact. 18. An updated Agent Synopsis Report for the Scotland Road property dated September 5, 2003, indicates that defendant Schellhase's name was removed as the Listing Agent and was replaced with defendant Spray as the listing agent. A copy of the Agent Synopsis Report for the Scotland Road dated September 5, 2003 is attached and incorporated herein as Exhibit "P". 19. Defendant Schellhase did not list the Scotland Road property with Plaintiff, which he was required to do pursuant to his Associate Contract with Plaintiff, but instead listed the property through defendant Re/Max, a competitor of Plaintiff. As a result, Plaintiff did not receive sales commission from the sale of the Scotland Road property as called for in the Associate Contract. 20. On June 26, 2003, Defendant Schellhase listed a property located at 131 Fourth Street N, Chambersburg, PA 17201. A copy of the Agent Synopsis Report for this property dated September 11, 2003 is attached and incorporated herein as Exhibit "G". Again, defendant Schellhase did not list this property with Plaintiff and it is believed and averred that defendant Schellhase listed this property with defendant Re/Max. 21. As a result of defendant Schellhase's failure to list the Fourth Street property with Plaintiff, Plaintiff did not receive sales commission from the sale of the Fourth Street property as called for in the Associate Contract. 22. On July 7, 2003, Defendant Schellhase listed a property located at 8 Field Circle, Chambersburg, PA 17201. A copy of the Agent Synopsis Report for this property dated September 11, 2003 is attached and incorporated herein as Exhibit "H". Defendant Schellhase did not list this property with Plaintiff and it is believed and averred that defendant Schellhase listed this property with defendant Re/Max. 23. As a result of defendant Schellhase's failure to list the Field Circle property with Plaintiff, Plaintiff did not receive sales commission from the sale of the Field Circle property as called for in the Associate Contract. 24. As evidenced by Exhibits "E" and "F", it is believed and averred that defendant Schellhase began working for or with Defendant Re/Max on or before June 23, 2003, while still under contract with Plaintiff. 25. On or about February 11, 2003, defendant Shatzer listed a property located at 7201 Ruritan Drive, Chambersburg, PA 17201, even though defendant Shatzer did not tender his resignation with Plaintiff until February 28, 2003. A copy of the Agent Synopsis Report for this property dated September 5, 2003 is attached and incorporated herein as Exhibit "I". 26. According to Exhibit "I", the Ruritan Drive property was listed on February 11, 2003 and identifies defendant Shatzer as the Listing agent and defendants Shatzer and Spray as the Show Contacts. 27. Defendant Shatzer did not list the Ruritan Drive property with Plaintiff, which he was required to do pursuant to his Associate Contract with Plaintiff, but instead listed the property through defendant Re/Max, a competitor of Plaintiff. As a result, Plaintiff did not receive sales commission from the sale of the Ruritan Drive property as called for in the Associate Contract. 28. As evidenced by Exhibit "I", it is believed and averred that defendant Shatzer began working for or with Defendant Re/Max on or before February 11, 2003, while still under contract with Plaintiff. 29. It is believed and averred that there are other properties that were listed by defendants Schellhase and Shatzer through defendant Re/Max which should have been listed with Plaintiff pursuant to their respective Associate Contracts and for which Plaintiff should have received commissions under the Associate Contracts. 30. It is believed and averred that defendants Schellhase and Shatzer referred potential customers of Plaintiff to Defendant Re/Max while defendants Schellhase and Shatzer were under contract with Plaintiff to the detriment of Plaintiff. 31. It is believed and averred that defendant Small, and thereby defendant Re/Max, was aware of the above activities of defendants Schellhase and Shatzer, assisted defendants Schellhase and Shatzer with the above activities and accepted said listings on behalf of Re/Max, all to the detriment of Plaintiff. 32. It is believed and averred that defendant Spray, and thereby defendant Re/Max, was aware of the above activities of Schellhase and Shatzer, assisted defendants Schellhase and Shatzer with the above activities and accepted said listings on behalf of Re/Max, all to the detriment of Plaintiff. 33. It is believed and averred that defendants Small and Spray on behalf of themselves and on behalf of defendant Re/Max, caused, persuaded and induced defendants Schellhase and Shatzer, while defendants Schellhase and Shatzer were still under contract with Plaintiff, to list properties with Defendant Re/Max instead of with Plaintiff, thus preventing Plaintiff from receiving commissions that Plaintiff was entitled to under the Associate Contracts. 34. It is believed and averred that defendants Small and Spray, on behalf of themselves and on behalf of defendant Re/Max, caused, persuaded and induced other persons who had Broker-Sales Associate Independent Contractor Agreements with Plaintiff to perform the same wrongful activities as defendants Schellhase and Shatzer as set forth herein and further concealed said actions. 35. It is believed and averred that defendant Re/Max received other commissions that Plaintiff was entitled to under the Associate Contracts. 36. It is believed and averred that defendant Re/Max received other commissions that Plaintiff was entitled to under other Broker-Sales Associate Independent Contractor Agreements. COUNT I - Breach of Contract Plaintiff v. Schellhase 37. The above paragraphs are incorporated herein by reference. 38. In the Associate Contract, Defendant Schellhase agreed to perform the following: ...work diligently and with his ... best efforts to sell, lease or rent any and all real estate listed with the BROKER, to solicit additional listings and customers of said BROKER and otherwise promote the business of serving the public in real estate transactions to the end that each party may derive the greatest benefit possible. ...conduct his...business and regulate his... habits so as to maintain and increase the goodwill and reputation of the BROKER... When the SALES ASSOCIATE performs any service hereunder whereby a commission or fee is earned and collected, said commission for fee will be divided with the Sales Associate receiving a proportionate share as set forth according to the policy manual... See a copy of the Associate Contract attached hereto as Exhibit "A" 39. The aforementioned actions of defendant Schellhase, including inter alia, failing to inform Plaintiff of prospective customers of Plaintiff and directing prospective customers of Plaintiff to defendant Re/Max, constitutes a breach of the Associate Contract. 40. As a direct and proximate result of defendant Schellhase's breach of the Associate Contract, Plaintiff has incurred damages in excess of $25,000.00. WHEREFORE., Plaintiff respectfully demands judgment in its favor and against Defendant Schellhase in an amount in excess of $25,000.00, plus accrued interest. COUNT II - Breach of Contract Plaintiff v. Shatzer 41. The above paragraphs are incorporated herein by reference 42. In the Associate Contract, Defendant Shatzer agreed to perform the following ...work diligently and with his ... best efforts to sell, lease or rent any and all real estate listed with the BROKER, to solicit additional listings and customers of said BROKER and otherwise promote the business of serving the public in real estate transactions to the end that each party may derive the greatest benefit possible. ...conduct his...business and regulate his... habits so as to maintain and increase the goodwill and reputation of the BROKER... When the SALES ASSOCIATE performs any service hereunder whereby a commission or fee is earned and collected, said commission for fee will be divided with the Sales Associate receiving a proportionate share as set forth according to the policy manual... See a copy of the Associate Contract attached hereto as Exhibit "B". 43. The aforementioned actions of defendant Shatzer, including inter alia, failing to inform Plaintiff of prospective customers of Plaintiff and directing prospective customers of Plaintiff to defendant Re/Max, constitutes a breach of the Associate Contract. 44. As a direct and proximate result of defendant Shatzer's breach of the Associate Contract, Plaintiff has incurred damages in excess of $25,000.00. WHEREFORE, Plaintiff respectfully demands judgment in its favor and against Defendant Shatzer in an amount in excess of $25,000.00, plus accrued interest. COUNT III - Tortuous Interference with Existing Contractual Relations Plaintiff v. Defendants Small, Spray, Re/Max, Schellhase and Shatzer 45. The above paragraphs are incorporated herein by reference. 46. As stated above, Plaintiff, a real estate broker, had contractual relationships with defendants Schellhase and Shatzer for defendants Schellhase and Shatzer to act as a real estate salespersons for Plaintiff. 47. It is believed and averred that the aforementioned actions of Small, Spray, Re/Max, Schellhase and Shatzer were done, without privilege or justification, with the intent to harm Plaintiff by interfering with the Plaintiff s contractual relationship with defendant Schellhase and Shatzer. 48. Defendants' actions were extreme and outrageous, were done intentionally and with malice and reckless disregard for Plaintiff's rights under the Associate Contract in an effort to preclude Plaintiff from receiving the benefits due Plaintiff and to gain a competitive advantage over Plaintiff and were done for defendants Small, Spray, Re/Max, Schellhase and Shatzer's own gain and constitute a tortuous interference with Plaintiffs rights under the Associate Contracts. 49. As a result of defendants Small, Spray, Re/Max, Schellhase and Shatzer's actions, Plaintiff incurred damages in excess of $25,000.00. WHEREFORE, Plaintiff respectfully demands judgment in its favor and against Defendants Small, Spray, Re/Max, Schellhase and Shatzer, jointly and severally, in an amount in excess of $25,000.00, plus accrued interest and punitive damages. COUNT IV - Tortuous Interference with Prospective Advantage/Contractual Relations Plaintiff v. Defendants Small, Spray, Re/Max, Schellhase and Shatzer 50. The above paragraphs are incorporated herein by reference. 51. By their aforementioned actions, defendants Small, Spray, Re/Max, Schellhase and Shatzer prevented prospective customers of Plaintiff from engaging Plaintiff as a Broker in their real estate transactions and that said prospective customers would have engaged Plaintiff as their Broker had defendants Small, Spray, Re/Max, Schellhase and Shatzer not conducted the activities as described herein. 52. Specifically, the properties mentioned above should have been listed with Plaintiff since they were listed while either defendant Schellhase or Shatzer (as the case may be) were still under the Associate Contract with Plaintiff. 53. Plaintiff believes and avers that there are numerous other prospective customers of Plaintiff that would have otherwise engaged the services of Plaintiff as a real estate broker but for the actions of defendants Small, Spray, Re/Max, Schellhase and Shatzer, who instead caused those prospective customers of Plaintiff to engage Re/Max as their real estate broker. 54. Through cooperation of defendants Small, Spray, Re/Max, Schellhase and Shatzer, it is believe and averred that defendants Schellhase and Shatzer, while under contract for Plaintiff, advised prospective customers of Plaintiff not to engage Plaintiff as their real estate broker but instead to use defendant Re/Max as their real estate Broker. 55. It is believed and averred that the aforementioned actions of the defendants were done, without privilege or justification, with the intent to harm Plaintiff by interfering with the Plaintiff's prospective contractual relationships with potential customers. 56. Defendants' actions were extreme and outrageous, were done intentionally and with malice and reckless disregard for Plaintiff's rights under prospective contracts with property owners to list their properties in an effort to preclude Plaintiff from receiving benefits from said prospective contracts and to gain a competitive advantage over Plaintiff and were done for defendants Small, Spray, Re/Max, Schellhase and Shatzer's own gain and constitute a tortuous interference with Plaintiff s rights under prospective advantage/contractual relations. 57. As a result of defendants Small, Spray, Re/Max, Schellhase and Shatzer's actions, Plaintiff incurred damages in excess of $25,000.00. WHEREFORE, Plaintiff respectfully demands judgment in its favor and against Defendants Small, Spray, Re/Max, Schellhase and Shatzer, jointly and severally, in an amount in excess of $25,000.00, plus accrued interest and punitive damages. COUNT V - Tortuous Interference with Existing Contractual Relations Plaintiff v. Defendants Small, Spray and Re/Max 58. The above paragraphs are incorporated herein by reference. 59. Plaintiff, a real estate broker, maintains contractual relationships with licensed real estate salespersons to list properties for Plaintiff. 60. It is believed and averred that defendants Small, Spray and Re/Max caused, persuaded and induced other such real estate salespersons contracted with Plaintiff, while such other real estate salespersons were still under contract with Plaintiff, to, inter alia, list properties with Defendant Re/Max instead of with Plaintiff, thus preventing Plaintiff from receiving commissions that Plaintiff was entitled to under contracts with other such real estate salespersons. 61. It is believed and averred that the aforementioned actions of Small, Spray and Re/Max were done, without privilege or justification, with the intent to harm Plaintiff by interfering with the Plaintiffs contractual relationships with the other said real estate salespersons. 62. Defendants' actions were extreme and outrageous, were done intentionally and with malice and reckless disregard for Plaintiffs rights under the contracts with the other such salespersons in an effort to preclude Plaintiff from receiving the benefits due Plaintiff and to gain a competitive advantage over Plaintiff and were done for defendants Small, Spray, and Re/Max's own gain and constitute a tortuous interference with Plaintiffs rights under the contractual relationships with the other said real estate salespersons. 63. As a result of defendants Small, Spray and Re/Max' actions, Plaintiff incurred damages in excess of $25,000.00. WHEREFORE., Plaintiff respectfully demands judgment in its favor and against Defendants Small, Spray and Re/Max jointly and severally, in an amount in excess of $25,000.00, plus accrued interest and punitive damages. COUNT VI - Tortuous Interference with Prospective Advantage/Contractual Relations Plaintiff v. Defendants Small, Spray and Re/Max 64. The above paragraphs are incorporated herein by reference. 65. It is believed and averred that Defendants Small, Spray and Re/Max, caused, induced and persuaded other real estate salespersons who were under contract with Plaintiff to list properties with Defendant Re/Max instead of with Plaintiff, thus preventing Plaintiff from receiving commissions that Plaintiff was entitled to under contracts with other such real estate salespersons. 66. Through cooperation of defendants Small, Spray and Re/Max, it is believed and averred that other real estate salespersons, while under contract with Plaintiff, advised other prospective customers of Plaintiff not to engage Plaintiff as their real estate broker but instead to use defendant Re/Max as their real estate Broker. 67. Plaintiff believes and avers that there are numerous prospective customers of Plaintiff that would have otherwise engaged the services of Plaintiff as a real estate broker but for the actions of defendants Small, Spray and Re/Max, who instead caused those prospective customers of Plaintiff to engage Re/Max as their real estate broker. 68. By their aforementioned actions, defendants Small, Spray and Re/Max prevented prospective customers of Plaintiff from engaging Plaintiff as a Broker in their real estate transactions and that said prospective customers would have engaged Plaintiff as their Broker had defendants Small, Spray and Re/Max not conducted the activities as described herein. 69. It is believed and averred that the aforementioned actions of the defendants were done, without privilege or justification, with the intent to harm Plaintiff by interfering with the Plaintiff's prospective contractual relationships with potential customers. 70. Defendants' actions were extreme and outrageous, were done intentionally and with malice and reckless disregard for Plaintiff's rights under prospective contracts with property owners to list their properties in an effort to preclude Plaintiff from receiving benefits from said prospective contracts and to gain a competitive advantage over Plaintiff and were done for defendants Small, Spray and Re/Max' own gain and constitute a tortuous interference with Plaintiff's rights under prospective advantage/contractual relations. 71. As a result of defendants Small, Spray and Re/Max's actions, Plaintiff incurred damages in excess of $25,000.00. WHEREFORE, Plaintiff respectfully demands judgment in its favor and against Defendants Small, Spray and Re/Max, jointly and severally, in an amount in excess of $25,000.00, plus accrued interest and punitive damages. COUNT VI - Fraud Plaintiff v. Schellhase 72. The above paragraphs are incorporated herein by reference. 73. At all material times, defendant Schellhase was under a duty to disclose all potential customers to Plaintiff. 74. Plaintiff justifiably relied on defendant Schellhase to disclose all potential customers to Plaintiff and to not direct Plaintiff's potential customers to Plaintiff's competitor, defendant Re/Max. 75. Defendant Schellhase intentionally concealed the existence of potential customers of Plaintiff and further concealed the fact that he directed said customers to defendant Re/Max, to the detriment of Plaintiff, both material facts. 76. Defendant Schellhase intentionally concealed his actions so that Plaintiff would rely on the presumption that he continued to be forthright in disclosing all potential customers to Plaintiff and continue to use Plaintiff's business, including floor time, to obtain new customers for Plaintiff. 77. Plaintiff did in fact reasonably rely on the presumption that defendant Schellhase continued to be forthright in his duty to disclose all potential customers to Plaintiff and continue to use Plaintiff's business, including floor time, to obtain new customers for Plaintiff. 78. Defendant Schellhase's actions were extreme and outrageous, were done intentionally and with malice and reckless disregard to Plaintiff. 79. As a result of defendant Schellhase's actions, Plaintiff incurred damages in excess of $25,000.00. WHEREFORE, Plaintiff respectfully demands judgment in its favor and against Defendant Schellhase in an amount in excess of $25,000.00, plus accrued interest and punitive damages. COUNT VII - Fraud Plaintiff v. Shatzer 80. The above paragraphs are incorporated herein by reference. 81. At all material times, defendant Shatzer was under a duty to disclose all potential customers to Plaintiff. 82. Plaintiff' justifiably relied on defendant Shatzer to disclose all potential customers to Plaintiff and to not direct Plaintiff's potential customers to Plaintiff's competitor, defendant Re/Max. 83. Defendant Shatzer intentionally concealed the existence of potential customers of Plaintiff and further concealed the fact that he directed said customers to defendant Re/Max, to the detriment of Plaintiff, both material facts. 84. Defendant Shatzer intentionally concealed his actions so that Plaintiff would rely on the presumption that he continued to be forthright in disclosing all potential customers to Plaintiff and continue to use Plaintiff's business, including floor time, to obtain new customers for Plaintiff. 85. Plaintiff did in fact reasonably rely on the presumption that defendant Shatzer continued to be forthright in his duty to disclose all potential customers to Plaintiff and continue to use Plaintiff's business, including floor time, to obtain new customers for Plaintiff. 86. Defendant Shatzer's actions were extreme and outrageous, were done intentionally and with malice and reckless disregard to Plaintiff. 87. As a result of defendant Shatzer's actions, Plaintiff incurred damages in excess of $25,000.00. WHEREFORE, Plaintiff respectfully demands judgment in its favor and against Defendant Shatzer in an amount in excess of $25,000.00, plus accrued interest and punitive damages. COUNT VIII - Fraud Plaintiff v. Defendants Small, Spray and Re/Max 88. The above paragraphs are incorporated herein by reference. 89. Pursuant to the Pennsylvania Real Estate Licensing and Registration Act ("RELRA"), no salesperson shall be employed by any other broker than is designated upon the current license issued to said salesperson. 63 P.S. 455.603(a). 90. RELRA. also prohibits a broker from making any substantial misrepresentation. 63 P.S. 455.604 91. During all material times mentioned herein, defendants Schellhase and Shatzer were under Associate Contracts with Plaintiff and worked as real estate salespersons under Plaintiff's brokerage license. See a copy of defendant Schellhase and Shatzer's Real Estate License indicating that Plaintiff was defendant Schellhase and Shatzer's broker, attached and incorporated hereto as Exhibits "J" and "K", respectively. 92. It is believed and averred that defendants Schellhase and Shatzer were working for defendant Re/Max while defendants Schellhase and Shatzer were under Associate Contracts with Plaintiff. 93. It is believed and averred that there are other real estate salespersons that have acted with Defendants Small, Spray and Re/Max in the same manner as Schellhase and Shatzer and that there are other potential customers of Plaintiff that were referred to Defendant Remax as a result thereof. 94. Defendants Small, Spray and Re/Max were aware that defendants Schellhase and Shatzer were under Associate Contracts with Plaintiff while defendants Schellhase and Shatzer were referring Plaintiff's potential customers to defendant Re/Max and while defendants Schellhase and Shatzer were working for defendant Re/Max. 95. Defendants Small, Spray and Re/Max had a duty to not violate RELRA and not take part in defendant Schellcase and Shatzer's actions in referring Plaintiff's potential customers to defendant Re/Max and permitting defendants Schellcase and Shatzer to work for defendant Re/Max while defendants Schellhase and Shatzer were under an Associate Contract with Plaintiff, however, Defendants Small, Spray and Re/Max intentionally took part in the concealment of these facts from Plaintiff. 96. Defendants Small, Spray and Re/Max intentionally concealed the aforementioned actions of defendants Shellhase and Shatzer, a material fact, so that Plaintiff would rely on the incorrect assumption that fact defendants Shellhase and Shatzer were not working for, or otherwise referring potential customers of Plaintiff to, defendant Re/Max, 97. Plaintiff justifiably relied on defendant Small, Spray and Re/Max to comply with the RELRA and not take part in defendants' Schellhase and Shatzer's actions or concealment thereof. 98. Defendant Small, Spray and Re/Max's actions were extreme and outrageous, were done intentionally and with malice and reckless disregard to Plaintiff and to gain a competitive advantage over Plaintiff. 99. As a result of defendants Small, Spray and Re/Max's actions, Plaintiff incurred damages in excess of $25,000.00. WHEREFORE, Plaintiff respectfully demands judgment in its favor and against Defendants Small, Spray, Re/Max jointly and severally, in an amount in excess of $25,000.00, plus accrued interest and punitive damages. COUNT IX - Civil Conspiracy Plaintiff v. All Defendants 100. The above paragraphs are incorporated herein by reference. 101. All defendants, together, intentionally and with malice, and without justification, agreed to, and did in fact act to, commit fraud and intentionally interfere with Plaintiff's then current and prospective contractual relations. 102. Defendants Small, Spray, Re/Max, Schellhase and Shatzer, together, intentionally and with malice, and without justification, agreed to, and did in fact act to, commit fraud and intentionally interfered with contracts Plaintiff had with real estate salespersons and prospective contractual relations. 103. The aforementioned actions of the defendants, including inter alia, agreeing to, and in fact stating on the Agent Synopsis Reports that defendant Spray (and thereby defendant Re/Max) was the listing agent for properties that were placed under contract while defendant Schellhase was still under the Associate Contract with Plaintiff, is an overt act done in the pursuance of the defendants' common purpose to defraud Plaintiff and interfere with Plaintiff's current and prospective contractual relations. 104. Further, the defendants agreed to and in fact acted together to cause prospective customers of Plaintiff to use defendant Re/Max as a broker instead of Plaintiff, an overt act done in the pursuance of the; defendants' common purpose to defraud Plaintiff and interfere with Plaintiff's current and prospective contractual relations. 105. It is believed and averred that there are other real estate salespersons that have acted with Defendants Small, Spray and Re/Max in the same manner as Schellhase and Shatzer and that there are other potential customers of Plaintiff that were referred to Defendant Remax as a result thereof. 106. Defendant Small, Spray, Re/Max, Schellhase and Shatzers' actions were extreme and outrageous, were done intentionally and with malice and reckless disregard to Plaintiff and to gain a competitive advantage over Plaintiff. 107. As a direct and proximate result of defendants' actions, Plaintiff has incurred damages in excess of $25,000.00. WHEREFORE, Plaintiff respectfully demands judgment in its favor and against Defendants Small, Spray, Re/Max and Schellhase, jointly and severally, in an amount in excess of $25,000.00, plus accrued interest and punitive damages. TES, P.C. Date: / r -17 j By: Verification I, J. Arnold Shank, being authorized to make this verification on behalf of Shank and Associates real Estate, Inc. d/b/a The Prudential Franklin Associates, verify I have read the foregoing Complaint, and state that the facts contained therein are true and correct to the best of my knowledge, information and belief and make these statements subject to the penalties of 18 Pa. C.S. 4904 relating to unswom falsification to authorities. Shank & Associates Real Estate, Inc. Dated: Ord 1, Zoo 3 By: CJ6?1? Arnold Shank, President ThePrudential o Franklin Associates, REALTORS' Broker - Sales Associate Independent Contractor Agreement THIS agreement made this A3" day of Se? . /999byan?l between The Prudential Franklin Associates hereinafter referred to as "BROKER , AND ['ra Selcll%rm.e__ hereinafter referred t as "SALES ASSOCIATES", for and inconsiderUtion of their mutual promises and agreements and for their mutual benefit do hereby agree: Whereas BROKER has established a general real estate brokerage business in the city of Chambersburg, County of Franklin, State of Pennsylvania and is qualified to and does procure the listings of real estate for sale, lease or rental and prospective purchasers, lessees and renters thereof, and does enjoy the goodwill of and a reputation for fair dealing with the public, and, Whereas, BROKER maintains an office in said city, properly equipped with furnishings and other equipment necessary for the operation of said business, and staffed with employees and associates necessary to serve the public, and, Whereas, SALES ASSOCIATE is now or has been engaged in business as a real estate SALES ASSOCIATE and is properly licensed by the State of Pennsylvania, and does enjoy a good reputation for fair and honest dealings with the public, and, Whereas it is deemed to be to the mutual advantage of said BROKER and said SALES ASSOCIATE to form the association hereinafter agreed to under the terms and conditions hereinafter set forth, therefore: 1. The BROKER agrees to make available to the SALES ASSOCIATE all current listings of the office and agrees to assist the SALES ASSOCIATE in his or her work by advice, instruction and full cooperation in every way possible. 2. The BROKER agrees that the SALES ASSOCIATE may share with other sales associates all the facilities of the office now located at 946 Lincoln Way East, Chambersburg, PA. 3. The SALES ASSOCIATE agrees to work diligently and with his or her best efforts to sell, lease or rent any and all real estate listed with the BROKER, to solicit additional listings and customers of said BROKER and otherwise promote the business of serving the public in real estate transactions to the end that each party may derive the greatest benefit possible. 4. The SALES ASSOCIATE agrees to conduct his or her business and regulate his or her habits so as to maintain and increase the goodwill and reputation of the BROKER, and the parties hereto agree to abide by and conform to all laws, rules and regulations and THE REALTORS CODE OF ETHICS that are binding upon or applicable to brokers and sales associates. When the SALES ASSOCIATE performs any service hereunder whereby a commission or fee is earned and collected, said commission for fee will be divided with the SALES ASSOCIATE receiving a proportionate share as set forth according to the policy manual. Any deviation from the normal commission split must be by mutual agreement of the BROKER, SALES ASSOCIATES and any other brokers and or sales associates that may be involved in the transaction. Neither party will be responsible to the other for any commissions earned but not paid by a member of the public, customer or client. SALES ASSOCIATE will be entitled to his or her commission when it is actually collected. In the event the SALES ASSOCIATE performs his or her duties in a transaction and collects the full commission, the SALES ASSOCIATE agrees to turn over to the BROKER said commission, and BROKER agrees to promptly pay the SALES ASSOCIATE the portion they are entitled to. All fees and commissions earned must be paid to the BROKER and then split as agreed. 6. The SALES ASSOCIATE hereby acknowledges having read the "Office Policy Manual" and hereby agrees to abide by all conditions and policies therein o as it may be amended in the future. 7. The BROKER shall not be liable to the SALES ASSOCIATE for any expenses incurred by the SALES ASSOCIATE not shall the SALES ASSOCIATE be liable to the BROKER except by mutual consent as circumstances arise. Suits for commissions shall be maintained only in the name of the BROKER and the SALES ASSOCIATE shall be construed to be a sub-agent only with respect to the customers and clients for whom services were performed and shall otherwise be deemed to be an INDEPENDENT CONTRACTOR and not an employee or partner of the BROKER. 8. This agreement may be terminated at any time by either party by written notice to the other, but the rights to any commission which accrued prior to said notice shall not be lost by the termination of this Agreement. 9. The SALES ASSOCIATE will not be treated as an employee with respect to the services performed as a real estate agent for federal tax purposes or for any other purposes. IN WITNESS THEREOF, the parties hereto have signed this agreement this <;?31XL day of seP}t, "e_r , Ia n l B?KER S ES ASSOCIATE 12193 ThePrudenbal p Franklin Associates, REALTORS' Broker -Sales Associate Independent Contra O CZ THIS agreement made this 20 'u day of Y ax K97by and betwet Associates hereinafter referred to as `BROKER", STD Jeer hereinafter referred t as "SALES ASSOCIATES", for and inconsideratii5r. promises and agreements and for their mutual benefit do hereby agree: Whereas BROKER has established a general real estate brokerage business in the city of Chambersburg, County of Franklin, State of Pennsylvania and is qualified to and does procure the listings of real estate for sale, lease or rental and prospective purchasers, lessees and renters thereof, and does enjoy the goodwill of and a reputation for fair dealing with the public, and, Whereas, BROKER maintains an office in said city, properly equipped with furnishings and other equipment necessary for the operation of said business, and staffed with employees and associates necessary to serve the public, and, Whereas, SALES ASSOCIATE is now or has been engaged in business as a real estate SALES ASSOCIATE and is properly licensed by the State of Pennsylvania, and does enjoy a good reputation for fair and honest dealings with the public, and, Whereas it is deemed to be to the mutual advantage of said BROKER and said SALES ASSOCIATE to form the association hereinafter agreed to under the terms and conditions hereinafter set forth, therefore: 1. The BROKER agrees to make available to the SALES ASSOCIATE all current listings of the office and agrees to assist the SALES ASSOCIATE in his or her work by advice, instruction and full cooperation in every way possible. 2. The BROKER agrees that the SALES ASSOCIATE may share with other sales associates all the facilities of the office now located at 946 Lincoln Way East, Chambersburg, PA. 3. The SALES ASSOCIATE agrees to work diligently and with his or her best efforts to sell, lease or rent any and all real estate listed with the BROKER, to solicit additional listings and customers of said BROKER and otherwise promote the business of serving the public in real estate transactions to the end that each parry may derive the greatest benefit possible. 4. The SALES ASSOCIATE agrees to conduct his or her business and regulate his or her habits so as to maintain and increase the goodwill and reputation of the BROKER, and the parties hereto agree to abide by and conform to all laws, rules and regulations and THE REALTORS CODE OF ETHICS that are binding upon or applicable to brokers and sales associates. 5. When the SALES ASSOCIATE performs any service hereunder whereby a commission or fee is earned and collected, said commission for fee will be divided with the SALES ASSOCIATE receiving a proportionate share as set forth according to the policy manual. Any deviation from the normal commission split must be by mutual agreement of the BROKER, SALES ASSOCIATES and any other brokers and or sales associates that may be involved in the transaction. Neither party will be responsible to the other for any commissions earned but not paid by a member of the public, customer or client. SALES ASSOCIATE will be entitled to his or her commission when it is actually collected. In the event the SALES ASSOCIATE performs his or her duties in a transaction and collects the full commission, the SALES ASSOCIATE agrees to turn over to the BROKER said commission, and BROKER agrees to promptly pay the SALES ASSOCIATE the portion they are entitled to. All fees and commissions earned must be paid to the BROKER and then split as agreed. 6. The SALES ASSOCIATE hereby acknowledges having read the "Office Policy Manual" and hereby agrees to abide by all conditions and policies therein o as it may be amended in the future. 7. The BROKER shall not be liable to the SALES ASSOCIATE for any expenses incurred by the SALES ASSOCIATE not shall the SALES ASSOCIATE be liable to the BROKER except by mutual consent as circumstances arise. Suits for commissions shall be maintained only in the name of the BROKER and the SALES ASSOCIATE shall be construed to be a sub-agent only with respect to the customers and clients for whom services were performed and shall otherwise be deemed to be an INDEPENDENT CONTRACTOR and not an employee or partner of the BROKER. 8. This agreement may be terminated at any time by either parry by written notice to the other, but the rights to any commission which accrued prior to said notice shall not be lost by the termination of this Agreement. 9. The SALES ASSOCIATE will not be treated as an employee with respect to the services performed as a real estate agent for federal tax purposes or for any other purposes. IN WITNESS THEREOF, the parties hereto have signed this agreement this a o day of B J.? R S?SS L 12/93 July 21, 2003 Dear Arnie, I have appreciated the opportunity to work at Prudential Franklin Associates. At this time, I have decided to transfer my license to ReMax Realty Agency, Inc. effective immediately. I have included a list of currently active listings and properties that I have under contract. I will be in contact with you to discuss these transactions. Sincerely, Craig Schellhase Arnold Shank Prudential Franklin Associates 946 Lincoln Way East Chambersburg, Pa. 17201 February 28, 2003 Arnold Shank, In the interest of my business success I have decided to terminate my services through Prudential Franklin Associates. I wish to thank you for the opportunities offered me during my tenure. Monday, March 3, 2003 I will begin service through ReMax Realty Agency, Inc.. Sincerely, Jeffrey L. Shatzer cc: Ed Garman enclosure o ='3 ry n n c. ' s? i o i P p Pj P n °j F pN .n.EO ? w P ,n. ?C R F P P" RA a? E ? ? ? Hy 0 ? c P 5 Q ? o ? P' O n o ,a o a o c P 3w° A Z b 0 w w w c c ? ?? ?oCi ??m m p?b 3E .0 wmm3r 332 rr3w m m p o o m m w O w m m o m m m m° m m ' .. .. 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W H-. 11 ` ` Initial `0911011999 iAIG `SCHELLHASE License Number 4ANK AND ASSOCIATES REAL ESTATE INC IE PRUDENTIAL FRANKLIN RS223085L 42\a Bureau of Professional and Oce'u PO Box 2649 Harrisburg PA 1 ?,• t. '.?0: ?: l..tii 'iii{i l eenso pi License Status! 3 ,Reattstate Salesperson ,? , , , - Initial License ?ate, ...r .. ". , 0512011901: JEFFREY L SHATZER License Number SHANK AND ASSOCIATES REAL ESTATE INC THE PRUDENTIAL FRANKLIN RS216111 L ASSOCIATES Expiration Date ' 946 LINCOLN WAY EAST CHAMBERSBURG PA 17201.0000 05/3112404 '• , -, Acung.Cominissioner of Professional and Occupational Affairs sign r Cgi?rititin 1 I w V ?J d x- BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates 946 Lincoln Way East Chambersburg, PA 17201 Plaintiff Attorneys for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg, PA 17201, and Re/Max Realty Agency, Inc. 1132 Kennebec Drive Chambersburg PA 17201 Defendants DOCKET NO.: d3 --,5jgr &e -i( !E2'''I ENTRY OF APPEARANCE t TO THE PROTHONOTARY: Kindly enter our appearance on behalf of Plaintiff in the above-captioned matter. TES. P.C. By: SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT SCHELLHASE CRAIG but was unable to locate Him in his bailiwick deputized the sheriff of FRANKLIN serve the within COMPLAINT & NOTICE to wit: He therefore County, Pennsylvania, to On October 31st , 2003 , this office was in receipt of the attached return from FRANKLIN Sheriff's Costs: Docketing 18.00 Out of County 9.00 Surcharge 10.00 Dep Franklin Cc 160.90 .00 197.90 10/31/2003 BLAIR GRANGER So answera? R. Thomas Klin Sheriff of Cumberland County Sworn and subscribed to before me this 4 F-- day of ,700:3 A./D.. ^ ,(?Q,a!?, C ? Protho o ar? / ? SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT , to wit: SCHELLHASE AS AGENT FOR RE/MAX REALTY AGENCY INC but was unable to locate Him in his bailiwick. He therefore deputized the sheriff of FRANKLIN County, Pennsylvania, to serve the within COMPLAINT Sc NOTICE On October 31st , 2003 , this office was in receipt of the attached return from FRANKLIN Sheriff's Costs: Docketing 6.00 Out of County .00 Surcharge 10.00 .00 .00 16.00 10/31/2003 BLAIR GRANGER Sworn and subscribed to before me this L EE- day of `lei,,,. o2VD3 A. D. y PCJ) Sow ?an`swers R. Thomas as Kline Sheriff of Cumberland County SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT , to wit: SHATZER JEFFREY L but was unable to locate Him deputized the sheriff of FRANKLIN in his bailiwick. He therefore serve the within COMPLAINT & NOTICE County, Pennsylvania, to On October 31st , 2003 , this office was in receipt of the attached return from FRANKLIN Sheriff's Costs: Docketing 6.00 Out of County .00 Surcharge 10.00 .00 .00 16.00 10/31/2003 BLAIR GRANGER So answer.,. R. Thomas Kline Sheriff of Cumberland County Sworn and subscribed to before me this day of A. D. Prothonotary SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT , to wit: SHATZER JEFFREY L AS AGENT FOR RE/MAX REALTY AGENCY INC but was unable to locate Him in his bailiwick. He therefore deputized the sheriff of FRANKLIN County, Pennsylvania, to serve the within COMPLAINT & NOTICE On October 31st , 2003 , this office was in receipt of the attached return from FRANKLIN Sheriff's Costs: So answers: Docketing 6.00 7 Out of County .00 ? Surcharge 10.00 R. Thomas Kline .00 .00 16.00 10/31/2003 BLAIR GRANGER Sworn and subscribed to before me this day of ?? ao?+3 A.D. Prothonotary Sheriff of Cumberland County SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT SMALL SAMUEL C but was unable to locate Him in his bailiwick deputized the sheriff of FRANKLIN serve the within COMPLAINT Sr NOTICE to wit: He therefore County, Pennsylvania, to On October 31st , 2003 , this office was in receipt of the attached return from FRANKLIN Sheriff's Costs: Docketing 6.00 Out of County .00 Surcharge 10.00 .00 .00 16.00 10/31/2003 BLAIR GRANGER So answers, R. Thomas Kline Sheriff of Cumberland County Sworn and subscribed to before me this day oflY? 020-03 A. D. Prothonotary SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT , to wit: SMALL SAMUEL AT AGENT/BROKER FOR RE/MAX REALTY AGENCY INC but was unable to locate Him in his bailiwick. He therefore deputized the sheriff of FRANKLIN County, Pennsylvania, to serve the within COMPLAINT & NOTICE On October 31st , 2003 , this office was in receipt of the attached return from FRANKLIN Sheriff's Costs: Docketing 6.00 Out of County .00 Surcharge 10.00 .00 .00 16.00 10/31/2003 BLAIR GRANGER Sworn and subscribed to before me this G? day of -2 ap?3 A. D. 0. ?? L Prot onotat,Qp ?y? r So answers: y R. Thomas Kline Sheriff of Cumberland County SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT , to wit: SPRAY STEVEN B but was unable to locate Him deputized the sheriff of FRANKLIN in his bailiwick. He therefore serve the within COMPLAINT & NOTICE County, Pennsylvania, to On October 31st , 2003 , this office was in receipt of the attached return from FRANKLIN Sheriff's Costs: Docketing 6.00 Out of County .00 Surcharge 10.00 .00 .00 16.00 10/31/2003 BLAIR GRANGER So answers: = R. Tlfomas Klin' Sheriff of Cumberland County Sworn and subscribed to before me this (, ? day of ?hpu,,w? ae903 A. D. C ),, . lw k,pi/? Prothonotary ' SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT , to wit: SPRAY STEVEN B AS AGENT/BROKER FOR RE/MAX REALTY AGENCY INC but was unable to locate Him in his bailiwick. He therefore deputized the sheriff of FRANKLIN County, Pennsylvania, to serve the within COMPLAINT & NOTICE On October 31st , 2003 , this office was in receipt of the attached return from FRANKLIN Sheriff's Costs: Docketing 6.00 Out of County .00 Surcharge 10.00 .00 .00 16.00 10/31/2003 BLAIR GRANGER Sworn and subscribed to before me this day of?? .2a0-3 A. D. C ?2 Prothonotary So answer ,-,f R. Thomas Kline Sheriff of Cumberland County SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2003-05294 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND SHANK AND ASSOCIATES REAL ESTA VS SCHELLHASE CRAIG ET AL R. Thomas Kline , Sheriff or Deputy Sheriff who being duly sworn according to law, says, that he made a diligent search and and inquiry for the within named DEFENDANT to wit: RE/MAX REALTY AGENCY INC but was unable to locate Them in his bailiwick. He therefore deputized the sheriff of FRANKLIN County, Pennsylvania, to serve the within COMPLAINT & NOTICE On October 31st , 2003 attached return from FRANKLIN Sheriff's Costs: Docketing Out of County Surcharge 6.00 .00 10.00 .00 .00 16.00 10/31/2003 BLAIR GRANGER Sworn and subscribed to before me this 4 ,!?- day of -fLvue? 2ov3 A. D. ?? Prothonotary this office was in receipt of the So answe . R<ho a s Kline Sheriff of Cumberland County In The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc vs. 3.. Craig Schellhase et al SERVE: Craig Schellhase No. 03-5294 civil Now, October 9, 2003 , I; SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. Sheriff of Cumberland County, PA Affidavit of Service Now, f `( d c within upon- C?cy fc?HtJ{ , 20 0 7 , at / 6 00 o'clock P M. served the at (I 32 4,,j4i3C-c N- ?HIHngE?Si1a2G Pt P? Loi by handing to 4 LLY a A-v and made known to 00. Of 14f ?L NOMW &W RWMdD. Md:MY, Nutty hM1C Ch=bw* u9Bao.FaithsCamrY W c,,,,j jm ftka be. 29.2999 copy of the original So answers, the contents thereof. l K (? Sheriff of FiLq.4?'4iti/ Couu , PA COSTS Sworn and subscribed before SERVICE $ me this /4 day of Q @k - , 20 03 MILEAGE AFFIDAVIT $ In The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc vs. Craig Schellhase et al SERVE: Craig Schellhase No. 03-5294 civil as agent, for Re/Max Realty Agency Inc Now, October 9, 2003 , I, SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. Sheriff of Cumberland County, PA Affidavit of Service Now, 0 c f 20 o 7 , at / b 60 o'clock M. served the within upon -7 S?E'?iFo9s5 fls. A-9i-7- F` /LE?/? k at (I 32 Kf??f{tart 1?2- ?NIR t?C?Sisu2G /7 Zbi by handing to k 4 LLy a TA-I copy of the original and made known to the contents thereof. So answers, NOWW saw - RichW V. McCarty. Notary P&M Il.CU4 ? ?? My CommiaaoeHwpicecJan. ri,1007 ot f Y - N,^- Sheriff of Fyi gri(( i Coun , PA COSTS Sworn and subscribed before SERVICE $ me this f'f day of 0? '')003 MILEAGE AFFIDAVIT I $ In The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc vs. Craig Schellhase et al SERVE: Jeffrey L. Shatzer No. 03-5294 civil Now, October 9, 2003 , I; SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. Sheriff of Cumberland County, PA Affidavit of Service Now, r ,i 0 ( f within upon y S?Etin at (( 32 4f)f)J c:( U2 by handing to ?n M t 4LLI a TA i and made known to 14cn , 20 0 ') , at / b Oo o'clock P M. served the C+??6tiaR?2c, f"`- /7 2,01 copy of the original the contents thereof. Notawsw So swers, T H? I M AWM MvCvty, Nday P9WW U awgKdm Bm, Frumn Cady My Commiesat Hxpima hn. 29, 2007 6,v- Sheriff of )L4- ?VjjA j County, PA COSTS Sworn and subscribed before SERVICE $ me this Iq day -of (Q ut-. 20 m3 MILEAGE AFFIDAVIT 0? $ In The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc vs. Craig Schellhase et al SERVE: Jeffrey L. Shatzer No. 03-5294 civil as agent- for Re/Max Realty Agency Inc c- 3 a 0` 7 Now, October 9, 2003 , I; SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. Sheriff of Cumberland County, PA Affidavit of Service Now, "I d c f 20 0 7 at / 6 Oo o'clock ? M. served the within D upon Tf ?? y A i rz- m-, AJ A? c -T- /? n- /c-£/ice 11?x at (I 32 Krni?Jf 2Cc V2- by handing to 4 k-LY a In t and made known to tqsA 06-kt-? I the contents thereof. So answers, M'CKtyNQWyPWiC Rlb"D. ' count my 29.200, aau N , Sheriff of F2 sC(??/ Coun , PA h A^' Sworn and subscribed before me this 11. ? day of (Q @-t- , 20 0 33 opo--14 EASibuAGj Pi- /-7 tai copy of the original 00'// ? COSTS SERVICE $ MILEAGE AFFIDAVIT In The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc vs. Craig Schellhase et al SERVE: Samuel C. Small No. 03-5294 civil 63 d 1 Now, October 9, 2003 , I; SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. r Sheriff of Cumberland County, PA Affidavit of Service Now, 0(-+ within -- upon _ J !`r^^ I t- Sri n z l ql /L at (I 32 Ks,,Jd£(tC( blL_ C??ng6n5iiu?c Pt- /"7 Lot by handing to ?n 4 c c y a TA-V and made known to , 20 O 7 , at / 6 OD o'clock P M. served the copy of the original So answers, the contents thereof. RidrdD. #1oQrry, Nary Public Nfy Commieeiup Expire i.. n,1007 (\C Jl/ Sheriff of c. q Co ty, PA COSTS Sworn and subscribed before SERVICE $ me this day of @ e 2 - 20 03 MILEAGE AFFIDAVIT $ In The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc vs. Craig Schellhase et al SERVE: Samuel C. Small No. 03-5294 civil as agent/broker for Re/Max Realty Agency Inc Now, October 9, 2003 , I; SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. Sheriff of Cumberland County, PA Affidavit of Service Now, ,r d 20 o l, at 00 o'clock M. served the within upon -S14 M14?z C. StiR<< at ?! 32 41idf3Cc u/L. CN1Rn?EnSisu2G ?? /7 Loi by handing to L Ll a Tn"ti copy of the original r,i- and made known to the contents thereof. So answers, N" Sod PA LR.,cbwdD. .?? Commis on EXPIros Jen. 29, 2PM Sheriff of Fyl q UUa/ ounry, PA COSTS Sworn and subscribed before SERVICE $ me this ff 4 day 9110 &t' 20 006 MILEAGE AFFIDAVIT In The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc VS. Craig Schellhase et al SERVE: Steven B. Spray No. 03-5294 civil 7 E1 I- Now, October 9, 2003 , I; SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. Sheriff of Cumberland County, PA Affidavit of Service Now, within upon- STf,?cr1 , 20 u 7 , at / 0 Oo o'clock P M. served the at (1 32 4tjjJ4zCc )V2. C?? ??f?Sisu2G ?? /7 Zai by handing to k 4 ,,y a T11- copy of the original and made known to ?sn the contents thereof. So answers, woma o. reuo ? ® '' n b v- Sheriff of q V ?j County, PA COSTS Sworn and ubscribed before SERVICE $ me this da of CA' 2-0 b 3 MILEAGE a c AFFIDAVIT In The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc VS. Craig Schellhase et al SERVE: Steven B. Spray No. 03-5294 civil as agent/broker for Re/Max Realty Agency Inc I -i LSD T Now, October 9, 2003 , I, SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. Sheriff of Cumberland County, PA Affidavit of Service Now, 0 c f within upon - `f 7/ ivies SP/I?r . ?s , at It 31 4,j?u c: ( U2. by handing to T? M : ?. 4k- L y a TA V and made known to 4 f f A. Nomw sow MY Cwnmigpi Ewpi?es Jn, Sworn and subscribed before me this Z4.? day of C ¢?: C3 20 L) 7 at / 6 00 o'clock 0144,-4fM1Si?uiLG? Pit- /7 7-01 copy of the original So answers, M. served the the contents thereof. Sheriff ,A-k mA Coun , PA COSTS SERVICE $ MILEAGE AFFIDAVIT Jn The Court of Common Pleas of Cumberland County, Pennsylvania Shank and Associates Real Estate Inc vs. Craig Schellhase et al SERVE: Re/Max Realty Agency, Inc. Now, October 9, 2003 hereby deputize the Sheriff of Franklin County to execute this Writ, this deputation being made at the request and risk of the Plaintiff. Sheriff of Cumberland County, PA Affidavit of Service Now, r `f D c f 20 v 7 , at / 6 Oo o'clock M. served the within No. 03-5294 civil , I; SHERIFF OF CUMBERLAND COUNTY, PA, do 63-as9,i upon 1?4 /,ki, i 4w,,T ?j4"cy at (1 32 ?s??J£ZC( b?. CWR ?/?[ti5iju2Gj 1 /7 Zbi by handing to L L Y a to t copy of the original e c #(h I? and made known to Pti A . 140w Sod Ria "D. MoCjr%14 7 P4ft W1ftft%F=Wft0M4 -4 Nb oomm 9M 6XPca Ja. 29, X" So answers, the contents thereof. 93 / p h ?iffoCounty, PA COSTS Sworn and subscribed before SERVICE $ me this 1 day of (0 C t-. 20 T3 MILEAGE AFFIDAVIT I $ TUPITZA, ALTMAN & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. OTTssr 03-524y &V' J ENTRY OF APPEARANCE TO THE PROTHONOTARY: Please enter the appearance of James S. Tupitza, Esquire, of Tupitza, Altman & Bryman, P.C. on behalf of all Defendants in the captioned matter. Respectfully submitted, Jam . Tupitza, Esquire Attorney for Defendants TUPITZA, ALTMAN & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-258T CERTIFICATE OF SERVICE I hereby certify I am this date serving a copy of the attached Entry of Appearance upon the following person by First Class Mail addressed as follows: Blair H. Granger, Esquire David J. Scaggs, Esquire 1800 E. Lancaster Avenue Paoli, PA 19301 Attorney for Plaintiff Respectfully submitted, Date: // - 141- Oj Ja s . Tupitza, Esquire Aft for Defendants C) o p e," TUPITZA, ALTMAN & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 0345& 03-529` e, vi I NOTICE TO PLEAD TO THE PLAINTIFF: Notice is hereby given that Defendants, by and through their attorney, James S. Tupitza, Esquire, have filed Preliminary Objections in he Office of the Prothonotary of Cumberland County, Pennsylvania, on //,(/Y/ 0 , 2003. TUPITZA, ALTMAN & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-258T DEFENDANTS' PRELIMINARY OBJECTIONS TO PLAINTIFF'S COMPLAINT Defendants, Craig Schellhase, Jeffrey L. Shatzer, Samuel C. Small, Steven B. Spray, and Re/Max Realty Agency, Inc., by and through their undersigned counsel, preliminarily objects to Plaintiffs Complaint as follows: I. EXISTENCE OF PLEDGE OF PLAINTIFF TO CONDUCT BUSINESS IN ACCORDANCE WITH TENETS OF CODE OF ETHICS AND STANDARDS OF PRACTICE OF THE NATIONAL ASSOCIATION OF REALTORS" 1. Plaintiff is a Pennsylvania Corporation licensed to do business in the Commonwealth of Pennsylvania as a real estate broker under the fictitious name of "The Prudential Franklin Associates" with a place of business at 946 Lincoln Way East, Chambersburg, Pennsylvania 17201. 2. Defendant, Re/Max Realty Agency, Inc. is a Pennsylvania Corporation licensed to do business in the Commonwealth of Pennsylvania with a place of business at 1132 Kennebec Drive, Chambersburg, PA 17201. 3. Defendants, Craig Schellhase, Jeffrey L. Shatzer, Samuel C. Small and Steven B. Spray, are all individuals who are either agents and/or brokers for Re/Max Realty Agency. 4. Plaintiffs cause of action contains allegations of breaches of Broker- Sales Associate Independent Contractor Agreements between Plaintiff and Defendants, Shatzer and Schellhase, allegations of tortuous interference with existing contractual relations against all Defendants, allegations of tortuous interference with prospective contractual relations, and allegations of fraud and civil conspiracy against all Defendants. 5. Under Pa.R.C.P. 1028(b)(6): "Preliminary objections may be filed by any party to any pleading and are limited to the following grounds: (6) pendency of a prior action or agreement for 2 alternative dispute resolution." 6. All of the parties, as licensed real estate agents and/or licensed real estate brokers, are Realtors® and, as such, have pledged to conduct their business in accordance with the tenets codified in the Code of Ethics and Standards of Practice of the National Association of Realtors@ (hereinafter "Standards of Practice") 7. The Standards of Practice, specifically pertinent portions of Article 17, provide the following: "In the event of contractual disputes or specific non-contractual disputes as defined in Standard of Practice 17-4 between REALTORS', the REALTORS' shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter.... The obligation to participate in arbitration contemplated by this Article includes the obligation of REALTORS' (principals) to cause their firms to arbitrate and be bound by any award." 8. Plaintiff has taken no action to submit this matter to arbitration pursuant to the regulations of their Board, namely Pen-Mar Regional Association of Realtors', which is the Board under whose regulations both Plaintiffs and Defendants' practice. 9. Plaintiff has breached its duty under the Standards of Practice by commencing this action instead of submitting the dispute, which is the subject of this action, to binding arbitration. II. FAILURE TO STATE A LEGALLY COGNIZABLE CLAIM FOR TORTIOUS INTERENCE WITH CONTRACT 10. Defendants, by this reference, incorporate the prior allegations of this pleading, as though such allegations were set forth herein at length. 11. Pa.R.C.P.1028(4) provides: 3 "Preliminary objections may be filed by any party to any pleading and are limited to the following grounds: (4) legal insufficiency of a pleading (demurrer)[.]" 12. In Count IV of the Complaint, the Plaintiff attempts to state a cause of action against Defendants for interference with prospective contractual relations between the Plaintiff and potential customers of the Plaintiff. 13. There is no cause of action for tortuous interference where the Plaintiffs business relationships with third parties are adversely affected as a consequence of a Defendant's breach of contractual obligations to the Plaintiff. See Glazer v. Chandler, 414 Pa. 304, 200 A.2d 416, 418 (1964). 14. In Count III of the Complaint, the Plaintiff attempts to state a cause of action against Defendants, Craig Schellhase ("Schellhase") and Jeffrey L. Shatzer ("Shatzer') for interference with contracts between Plaintiff and Schellhase and Plaintiff and Schatzer. 15. One party to a contract cannot sue the other party for tortuous interference with the contract between them. See Bernback v. Greco, 69 Fed. Appx. 98, 100, 2003 WL 21577959, 2 (3rd Cir. 2003), citing Daniel Adams Assoc Inc v Rimbach Publishing Inc., 360 Pa.Super. 72, 78-79, 519 A.2d 997 (1987). 16. The obligations of Schellhase and Schatzer, if any, arose under a contract. 17. A promise under a contract to do something in the future, which promise is not kept, is not fraud. See Neale v. American Motorists Fire Ins. Co. 4 185 Pa. Super. 60, 62,138 A.2d 290, 291 (1958). 18. Assuming the truth of the allegations, such allegations are breaches of contract, if any existed between the parties at the time. III. FAILURE TO STATE A LEGALLY COGNIZABLE CLAIM FOR FRAUD 19. Defendants, by this reference, incorporate the prior allegations of this pleading, as though such allegations were set forth herein at length. 20. The Plaintiffs purported claims against Schellhase and Schatzer are inconsistent with the "Gist of the Action" doctrine, which disallows tort claims where the gravamen of the action arises out of the contractual relationship. See Phico Insurance Co v Presbyterian Medical Services Corp., 444 Pa. Super. 221, 228, 663 A.2d 753, 757 (1995); Bash v. Bell Telephone Co., 411 Pa. Super. 347, 601 A.2d 825(1992). 21. The contract described in the Complaint clearly is not collateral to the instant cause of action. 22. The introduction of fraud theories into actions between contracting parties has the effect and goal of interjecting claims for punitive damages in breach of contract cases in an improper attempt to punish the allegedly breaching party instead of seeking to recover the compensatory damages for which the law provides in breach of contract cases. The law of Pennsylvania clearly provides that punitive damages are not recoverable in an actions based upon breach of contract. See Johnson v. Hyundai Motor America, 698 A.2d 631, 639 (Pa.Super. 1997) (citing Thorsen v. Iron and Glass Bank, 328 Pa.Super. 135, 143, 476 A.2d 928, 932 (1984)). 5 23. Because the controversy arises out of a contract, the claim for punitive damages against Schellhase and Shatzer must be stricken, as punitive damages will not be awarded for a breached contract, even if the breaching party allegedly acted in bad faith. See Bleiberg v. Insurance Company of North America, 50 D. & C. 3d 570, 572 (C. P. Allegheny Co. 1987). IV. FAILURE TO STATE A LEGALLY COGNIZABLE CLAIM FOR TORT DAMAGES FOR BREACH OF CONTRACT 24. Defendants, by this reference, incorporate the prior allegations of this pleading, as though such allegations were set forth herein at length. 25. In Counts III through IX of the Complaint, the Plaintiff attempts to states causes of action for tortuous interference with contract, fraud and civil conspiracy. 26. The claims of the Plaintiff, if any, against Schellhase and Schatzer were governed by the contracts that the Plaintiff describes in paragraphs 9 and 10 of the Complaint. 27. A party to a contract may not sue the other party to the contract in tort for damages arising out of a breach of the contract. See Stout v. Peugeot Motors of America, 662 F.Supp. 1016, 1018 (E.D.Pa.,1986), citing Standard Pipeline Coating Co v Solomon & Teslovich. Inc., 344 Pa.Super. 367, 496 A.2d 840, 843- 44 (1985); Glazer v. Chandler, 414 Pa. 304, 308 & f.n.1, 200 A.2d 416 (1964); Iron Mountain Security Storage Corp v American Specialty Foods, Inc., 457 F.Supp. 1158,1165-66 (E.D.Pa.1978). 28. This controversy should be decided in accordance with the 6 principles of contract law because disputes between brokers and other brokers and between brokers and their agents that arise when agents change their brokers of record are the subject matter of contracts between the agents and the brokers and because real estate agency is a specialized professional calling with its own system for self-governance and handling disputes. The arbitrators are best equipped to decide whether any of the agents or Defendant Re/Max Realty Agency, Inc. acted improperly as to the Plaintiff, and the Plaintiff agreed to be a part of that system of handling disputes. WHEREFORE, Defendants, by their undersigned counsel, respectfully request this Honorable Court compel Plaintiff to submit its dispute against Defendants to binding arbitration in accordance with the regulations of the Pen- Mar Regional Association of REALTORS® Board, and issue an Order in the form submitted herewith. Respectfully submitted, TUPITZA, ALTMAN & BRYMAN, P.C. Dated: It -/ Y - 0 by: Ja a S. Tupitza, Esquire Attorney for Defendants 7 Nov 13 03 03:34p RE/MN% Realty 717-267-30E7 P•1 Ro..,.. P. 74i 2?FhI v> WFICATZON 'I he undersigned hereby verities that the facts alleged in the foregoing Defendants' Preliminary Objections to Plaintiff's Complaint are true and correct to the bes- af' his knowledge and belief file undersigned understands that false statements hereunder are ;object to the penalties for unswom falsifteatinn of 18 PA.C. S. 4904. ------------ Daic??????? Samuel C. Small TUPITZA, ALTMAN & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-258T CERTIFICATE OF SERVICE I hereby certify I am this date serving a copy of the attached Preliminary Objections of Defendants upon the following person by First Class Mail addressed as follows: Blair H. Granger, Esquire David J. Scaggs, Esquire 1800 E. Lancaster Avenue Paoli, PA 19301 Attorney for Plaintiff Respectfully submitted, Date: Jam . Tupitza, Esquire Atjkrj34 for Defendants 2 h r- r? `v S '. _D r TO THE WITHIN NAMED RESPONSE TO THE ENCI SERVICE HEREOF OR A JUI By: Attomey for BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants BCRE HEREBY NOTIFIED TO FILE A WRITTEN OBJECTIONS WITHIN TWENTY (20) DAYS OF RF.P^GAINST YOU. for Plaintiff PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-258T PLAINTIFF'S PRELIMINARY OBJECTIONS TO DEFENDANTS' PRELIMINARY OBJECTIONS Plaintiffs, by their undersigned counsel, do hereby file Preliminary Objections to Defendants Preliminary Objections, as follows: 1. Plaintiff filed its complaint on October 6, 2003. 2. Defendants filed Preliminary Objections to Plaintiff's Complaint on or about November 14,2003.' 3. Plaintiffs complaint contains allegations against Defendants for Breach of Contract, Tortuous Interference with Existing Contractual Relations, Tortuous Interference with Prospective Advantage/Contractual Relations, Fraud and Civil Conspiracy. Motion to Strike Defendants' Prelimina Objection 4. Defendants' Preliminary Objections constitute a "speaking demurrer". See: Linda Coal & Supply Co v Tasa Coal Co 416 Pa. 97, 204 A.2d 451 (1964). 5. Section I of Defendants' Preliminary Objections allege that Plaintiffs claims are required to be arbitrated by the Code of Ethics and Standards of Practice ("Standards of Practice") of the National Association of Realtors ("NAR"). 6. There was no reference to any arbitration provision in either the Complaint or the Independent Contractor Agreement attached to Plaintiff s Complaint. Rather, the Defendants attempt to assert the following, none of which are in the complaint or any Exhibits: a. That Plaintiff and Defendants are all members of the NAR; b. That the NAR requires certain disputes be arbitrated; C. That the Standards of Practice promulgated by the NAR require certain disputes be arbitrated; d. That the disputes between Plaintiff and Defendants are of the type required by the NAR and its Standards of Practice to be arbitrated. By agreement of counsel, Defendants were granted an extension to respond to Plaintiffs complaint until November 17, 2003. 7. Plaintiff made no reference to the National Association of Realtor's Arbitration or their Standards of Practice in its complaint. 8. "It is fundamental that a demurrer cannot supply a fact missing in the complaint." Id at 102; 454. "In passing on a demurrer a court cannot consider matters collateral to the pleading opposed but only such matters as arise out of the statement of claim or complaint itself." Id omLtted). It is well-settled that a demurrer cannot be a "speaking demurrer" and cannot be used to supply a fact missing in the complaint. Ma-11 v. Goodman 310 Pa.Super. 465, 473, 456 A.2d 1029, 1033 (1983).2 9. As no reference to the Standards of Practice was mentioned in Plaintiff s Complaint, Defendants are not entitled to raise such matters in Preliminary Objections. WHEREFORE, Plaintiff respectfully requests that this Honorable Court Strike Defendants' Preliminary Objection "I", entitled "Existence of Pledge of Plaintiff to conduct business in accordance with tenets of code of ethics and standards of practice of the National Association of Realtors", with prejudice. C. Date: z The proper course for Defendants to follow, if they actually believe that arbitration is appropriate, is to refile the remainder of their Preliminary Objections as applicable and upon their resolution, file a Petition for Arbitration, which can then be subject to discovery. n r .. _Ti _ _ - $1 .' ?_` U'._ ., ? ?f.., _.... -. ?h l l -C? r ?? a:i BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants Attorneys for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW p3- 5 29q DOCKET NO.: G3-'2-ln CERTIFICATE OF SERVICE I, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Plaintiff's Preliminary Objections to Defendants' Preliminary Objections with proposed Order, Brief in Support thereof, and a Praecipe for Listing Case for Argument, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 .C. Date: It-.?'( )-03 By: c; ?-; ,-, c- ' =;, z, _? - _ ??:: , n ?= > ? , i? 1. , _ T ,_ •. ? r ?? ? ?i? _ Lb ?S PRAECIPE FOR LISTING CASE FOR ARGUMENT (Rut be typewritten and submitted in duplicate) TO THE PROTHONOTARY OF CUMBERLAND COUNTY: Please List the witbin matter for the next Argument Cant. CAPTION OF CASE (entire caption east be stated in full) Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff VS. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Mas Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Mas Realty Agency, Inc. (Defendant) p3--s20 N0,0314S T Civil W 2003 1. state matter to be argued (i.e., plaintiff's motion for new trial, defer&nt'9 dam= to complaint, etc.): plaintiff' s Preliminary Objections to Defendants' Preliminary objections 2. Ideetify oamsel who will argue cage: (a) fW.plaintiff: David J. Scaggs, Esq. Adkesa: BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 E. Lancaster Avenue ) P610-kO-7500 1 (b) foe defermdat?P James T. Tupitza, Esquire TUPITZA, ALTMAN & BRYMAN, P.C. 212 W. Gay Street West Chester PA 19380-2942 1. I will rotity dl 0;n6ABJ _ L two daps that this Coss he* e.an listed tw ar9mmt. 4. 'VO'""'t 00Wt Dates February 4` 20qt L/ Wtede November 20, 2003 At aintiff David J.'Scaggs, Atty I.D 82117 l'7 c ?? ? ?- c<i ^ri 'qti;.? '. nii? ,._ ' ;.> u7 ? ., -?, rc ?-t : ? ^? L i , ; n ?c_ » ?_ 4b TUPITZA, ALTMAN & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS Attorney for Defendants IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-2W .- 5.299 ANSWERS TO PLAINTIFF'S PRELIMINARY OBJECTIONS TO DEFENDANTS' PRELIMINARY OBJECTIONS Defendants, by their undersigned counsel, incorporate the contents of their Preliminary Objections to Plaintiffs' Complaint filed on or about November 14, 2003, and hereby answer the Plaintiffs' Preliminary Objections to the Defendants' Preliminary Objections, as follows: 1. Admitted. 2. Admitted. 3. Admitted in part and denied in part. It is admitted that the Complaint contains allegations as described in this paragraph. However, the Complaint, read as a whole, must speak for itself. Defendants' Answer to Motion to Strike Defendants' Preliminary Objections Defendants, by this reference, incorporate the contents of their Preliminary Objections to Plaintiffs' Complaint filed on or about November 14, 2003. 4. Denied. This averment is a conclusion of law, to which no response is required in accordance with the Pennsylvania Rules of Civil Procedure. By way of further response, it is denied that the Defendants' Preliminary Objections constitute a "speaking demurrer." With respect to the matters regarding which the Preliminary Objections contain factual averments, the Preliminary Objections are not a demurrer, but rather are a preliminary objection pursuant to P.R.C.P. 1028 that claims made by the Plaintiffs are subject to an arbitration agreement. Under Pennsylvania procedure, Preliminary Objections may be filed asserting the existence of an agreement to arbitrate. See e.g., Cohen v. First Financial Planners. Inc. 2003 WL 1847764 (2003). A preliminary objection that claims made by a party are subject to an arbitration agreement is not a demurrer. Demurrers are filed pursuant to P.R.C.P. 1028 (a)(4). It is P.R.C.P. 1028(a)(6) that authorizes the Defendants preliminary objection regarding the NAR's arbitration processes. P.R.C.P. 1028(a) (6) provides: "Preliminary objections may be filed by any party to any pleading and are limited to the following grounds: (6) pendency of a prior action or agreement for alternative dispute resolution." One of the explanatory notes to Rule 1028 states as follows: "NOTE: Preliminary Objections raising an issue under subdivision (a)(1), (5) or (6) cannot be determined from facts of record. In such a case, the Preliminary Objections must be endorsed with a Notice to Plead or no response will be required under Rule 1029(d)." The Defendants' Preliminary Objections were verified and were endorsed with a Notice to Plead. See etc. . Levy v. Lenenberg. 795 A.2d 419, 423 (Pa.Super. 2002) (citing Pa.R.C.P. 1028(c)(2)), in which the Superior Court holds that when a preliminary objection raises an issue of fact, the trial court shall consider evidence by deposition or otherwise. An order denying a petition to compel arbitration is appealable on an interlocutory basis. See e.g. Shadduck v. Christopher J. Kaclik, Inc. 713 A.2d 635, 636 (Pa.Super. 1998). 5. Admitted in part and denied in part. It is admitted that in their Preliminary Objections, the Defendants have alleged that the Plaintiffs' claims are required to be arbitrated by the Code of Ethics and Standards of Practice ("Standards of Practice') of the National Association of Realtors ("NAR"). However, the Preliminary Objections, as read in their entirety, must speak for themselves. 6. Admitted in part and denied in part. It is admitted that the Plaintiffs in their Complaint did not refer to an arbitration provision. To the extent that the Plaintiffs suggest that this prohibits the filing of a preliminary objection based on the obligation to arbitrate, such averment by the Plaintiffs is a legal conclusion and the conclusion is utterly incorrect. The Defendants, with this reference, incorporate Paragraphs 4 and 5 of this Answer. 7. Admitted in part and denied in part. It is admitted that the Plaintiffs may not have referred to arbitration procedures or Standards of Practice of the NAR in the Complaint. However, it is denied that such fact precludes the filing of a preliminary objection based thereon. The Defendants, with this reference, incorporate Paragraphs 4 and 5 of this Answer. 8. Admitted in part and denied in part. It is admitted that a demurrer cannot supply a fact missing in the Complaint. However, this principle in irrelevant to the instant situation. The Defendants' contention that the Plaintiffs' claims are required to be arbitrated in accordance with the Standards of Practice of the NAR is not a demurrer. By way of further response, the Defendants incorporate paragraphs 4 and 5 of this pleading. 9. Denied. The Defendants deny that reference to the NAR Standards of Practice in the Complaint is required in order for the Defendants to raise such matters in their Preliminary Objections. By way of further response, the Defendants incorporate paragraphs 4 and 5 of this pleading. WHEREFORE, Defendants respectively request that this Honorable Court enter an Order: 1. Overruling the Plaintiffs' Preliminary Objections to the Defendants' Preliminary Objections; 2. Sustaining the Defendants' Preliminary Objections to the Complaint and ordering the parties to arbitrate this matter in accordance with the NAR's Standards of Practice. 3. Awarding reasonable attorneys fees for the work necessary to respond to the instant Preliminary Objections by the Plaintiffs. Date: ( ? \ G3 By: Tupitza, Altman & Bryman, P.C. JAMS S. TUPITZA, ESQUIRE Attor ey for Defendants Crai Schellhase Je ey L. Shatzer Samuel C. Small Steven B. Spray Re/Max Realty Agency, Inc. TUPITZA, ALTMAN & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-258T CERTIFICATE OF SERVICE I hereby certify I am this date serving a copy of the attached Answer to Plaintiffs Preliminary Objections to Defendants' Preliminary Objections upon the following person by First Class Mail addressed as follows: Blair H. Granger, Esquire David J. Scaggs, Esquire 1800 E. Lancaster Avenue Paoli, PA 19301 Attorney for Plaintiff Date: ?'- I ) ly submitted, Tupitza, Esquire for Defendants ' J c-i n UJ,i'.. _-I O CJ y? ? ..rt.) :III t (J ? BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants ror riainuu ) COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 2003-5294 PLAINTIFF'S RESPONSE TO DEFENDANTS' PRELIMINARY OBJECTIONS TO PLAINTIFF'S COMPLAINT Plaintiff, by its undersigned counsel, does hereby respond to Defendants' Preliminary Objections to Plaintiff's Complaint 1. Admitted. 2. Admitted. 3. Admitted. 4. Admitted. 5. Admitted. 6. Admitted in part; denied in part. The averment is admitted as to Plaintiff; however, Plaintiff is without knowledge as to the truth of the averment as it pertains to Defendant and the same is therefore denied. 7. Denied. To the contrary, the text quoted by Defendants is inaccurate and incomplete and omits extremely pertinent portions of the actual text. The actual text omitted by Defendants is set forth below in bold and underlined type: Article 17 In the event of contractual disputes or specific non-contractual disputes as defined in Standard of Practice 17-4 between REALTORSO (principals) associated with different firms arising out of their relationship as REALTORS, the REALTORSO shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter. 8. Admitted in part; denied in part. It is admitted that Plaintiff has not submitted this matter to arbitration. It is denied that there is an obligation to do so. Plaintiff is not required to submit this matter to arbitration as the subject matter of the dispute does not fall within the matters required to be arbitrated by Article 17. As set forth in Article 17, only contractual disputes or non contractual disputes as defined in Standard of Practice 17-4 between REALTORSO (principals), associated with different firms, must submit to arbitration. Defendants Schellhase and Shatzer were not "principals" and were in fact associated with Plaintiff (and not a different firm) when their actions causing these disputes arose. Therefore, Plaintiff's disputes with Defendants Schellhase and Shatzer are not required to be arbitrated. Further, there are no non-contractual disputes as defined in Standard of Practice 17-4 between Plaintiff and Defendants Schellhase and Shatzer (there are non-contractual disputes between Plaintiff and Defendants Schellhase and Shatzer, but they are not of the type defined by Standard of Practice 17-4) and therefore none of Plaintiffs claims against Defendants Schellhase and Shatzer are required to be submitted to arbitration. In addition, since there are no contractual disputes between Plaintiffs and Defendants Small, Spray and Re/Max (even though they are of different firms and are principals) and since there are no non-contractual disputes as defined in Standard of Practice 17-4 between Plaintiff and Defendants Small, Spray and Re/Max, none of Plaintiff s claims against Defendants Small, Spray and Re/Max are required to be submitted to arbitration. As such, none of Plaintiff's claims are required to be submitted to arbitration. 9. Denied. Plaintiff has no such duty to submit its claims in its Complaint to arbitration. See paragraph 8, supra. 10. No response is required. 11. Admitted. 12. Denied. Plaintiff does in fact state a cause of action for Tortuous Interference with Prospective Advantage/Contractual Relations against Defendants Small, Spray, Re/Max, Schellhase and Shatzer in Count N of its complaint. 13. Denied. Defendant misconstrues the allegations of Plaintiff and the holding of Glazer v. Chandler 414 Pa. 304, 200 A.2d 416, (1964). First, Defendants are assuming that the same conduct of Defendants Schellhase and Shatzer that caused the breach of conduct is also the same conduct that caused the tortuous interference. Defendants are overlooking the fact that there can be certain non contractual conduct on the part of Schellhase and Shatzer that supports a claim for tortuous interference. As was actually stated in Glazer, it is when "the allegations and evidence only disclose that defendant breached his contracts with plaintiff and that as an incidental consequence thereof plaintiffs business relationships with third parties have been affected, an action lies only in contract for defendant's breaches." Glazer at 308, 418. Therefore, Plaintiff is allowed to plead additional claims or claims in the alternative. Only if the evidence discloses that Defendants Schellhase and Shatzer's breach of contractual duties caused the tortuous interference with contract, would the cause for tortuous interference with contractual relations fail. 14. Denied. Plaintiff does in fact state a cause of action for Tortuous Interference with Existing Contractual Relations against Defendants Defendants Small, Spray, Re/Max, Schellhase and Shatzer in Count III of its complaint. 15. Denied as a conclusion of law. By way of further response, there were no contracts between Plaintiff and Defendants Small, Spray and Re/Max. 16. Admitted in part; denied in part. It is admitted that there were contractual obligations owed to Plaintiffs by Defendants Schellhase and Shatzer. However, it is denied that all actions performed by Schellhase and Shatzer were covered by their contract with Plaintiff. 17. Denied as a conclusion of law. 18. Admitted in part; denied in part. It is admitted that Plaintiff has alleged breach of contract. It is denied that said allegations only contain claims for breach of contract. Moreover, by stating in paragraph 18 of their Objections: "if any [contract] existed between the parties at the time", defendants are acknowledging that the claims for tortuous interference may be viable, for example, if it is proven that there were no contractual relations between the parties. 19. No response is required. 20. Denied as a conclusion of law. First, the Gist of the Action doctrine has not been adopted by the Pennsylvania Supreme Court. Further, it is denied that "gist" of all plaintiff's claims are in contract. To the contrary, Plaintiff has tort claims against Defendants Small, Spray, Re/Max for which Plaintiff had no contract. Further, Plaintiff's tort claims against Defendants Schellhase and Shatzer are for conduct unrelated to their duties outlined in Defendants' Schellhase and Shatzer contracts. Moreover, since the defendants in fact do call into question the existence of the contracts (see paragraph 18 of Defendants' Preliminary Objections where they state: "if any [contract] existed between the parties at the time"), then a court should not dismiss an alternative tort theory at the Preliminary Objections stage. Comsup Commodities. Inc. V. Osram Sylvania. Inc. 2003 WL 22977519, Pa.Com.Pl. (2003). At the very least, Plaintiff is entitled to plead in the alternative. Pa.R.C.P. 1020(c). 21. Denied as a conclusion of law. 22. Denied as a conclusion of law. By way of further response, see paragraph 20, supra. By way of further response, Plaintiff s demand for punitive damages are pursuant to its tort claims, not contract claims. 23. Denied as a conclusion of law. By way of further response, see paragraph 20, supra. 24. No response is required. 25. Denied. Plaintiff does in fact state a cause of action for Tortuous Interference with Existing Contractual Relations against Defendants Small, Spray, Re/Max, Schellhase and Shatzer (Count III), Tortuous Interference with Prospective Advantage/Contractual Relations against Defendants Small, Spray, Re/Max, Schellhase and Shatzer (Count IV), Tortuous Interference with Existing Contractual Relations against Defendants Small, Spray and Re/Max (Count V), Tortuous Interference with Prospective Advantage/Contractual Relations against Defendants Small, Spray and Re/Max (Count VI), Fraud against Schellhase, Shatzer, Small, Spray and Re/Max (Counts VI through VIII), and Civil Conspiracy against all Defendants (Count IX). 26. Admitted in part; denied in part. It is admitted some of plaintiff's claims against Defendants Schellhase and Shatzer are in contract. It is denied that said Plaintiff s claims are only governed by contract. Moreover, as Defendant stated in paragraph 18 of their Objections: "if any [contract] existed between the parties at the time", defendants are acknowledging that the claims for tortuous interference may be viable, for example, if it is proven that there were no contractual relations between the parties. 27. Denied as a conclusion of law. By way of further response, there were no contracts between Plaintiff and Defendants Small, Spray and Re/Max. 28. Denied as a conclusion of law. By way of further response, disputes between "brokers and other brokers" are not governed by contract. Further, real estate agency is not such a "specialized profession" that arbitrators are better equipped than the courts to handle disputes. Moreover, the profession does not call for its own system for self-governance, as evidenced by the Standards of Practice referred to by Defendants, which only calls for arbitration in certain limited exceptions. WHEREFORE, Plaintiff respectfully requests that this Honorable Court Overrule Defendants' Preliminary Objections and Order Defendants to Answer Plaintiff s Complaint. & ASSOCIATES, P.C. Date: By: VA David J n ri C? .c •n I'j l ? a.. W rl e {?J fn r w SHANK AND ASSOCIATES REAL ESTATE, INC., d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V. CRAIG SCHELLHASE, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., JEFFREY L. SHATZER, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., SAMUEL C. SMALL, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., STEVEN B. SPRAY, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC. AND RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 03-5294 CIVIL TERM IN RE: PRELIMINARY OBJECTIONS OF DEFENDANTS TO PLAINTIFF'S COMPLAINT AND PLAINTIFF'S PRELIMINARY OBJECTION TO DEFENDANTS' PRELIMINARY OBJECTIONS BEFORE BAYLEY, J. ORDER OF COURT AND NOW, this aq?- day of April, 2004, IT I;i ORDERED: (1) The preliminary objections of plaintiff to defendants' preliminary objections, ARE DISMISSED. (2) Defendants' preliminary objection to compel arbitration, IS GRANTED. This case IS STAYED pending the resolution of an arbitration proceeding. 03-5294 CIVIL TERM By the xcnld? Edgar B. Bayley, J. ?bavid J. Scaggs, Esquire 1800 East Lancaster Avenue Paioli, PA 19301 For Plaintiff ?James S. Tupitza, Esquire 212 W. Gay Street West Chester, PA 19380 oy -a 4 7 For Defendants :sal SHANK AND ASSOCIATES REAL ESTATE, INC., d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V. CRAIG SCHELLHASE, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., JEFFREY L. SHATZER, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., SAMUEL C. SMALL, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., STEVEN B. SPRAY, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC. AND RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 03-5294 CIVIL TERM IN RE: PRELIMINARY OBJECTIONS OF DEFENDANTS TO PLAINTIFF'S COMPLAINT AND PLAINTIFF'S PRELIMINARY OBJECTION TO DEFENDANTS' PRELIMINARY OBJECTIONS BEFORE BAYLEY, J. OPINION AND ORDER OF COURT Bayley, J., April 29,2004:-- Plaintiff filed a complaint on October 6, 2003. Defendants filed preliminary objections to dismiss the complaint on the grounds that plaintiffs claims were subject to mandatory arbitration pursuant to the Code of Ethics and Standards of Practice of the National Association of Realtors. Plaintiff filed preliminary objections to defendants' 03-5294 CIVIL TERM preliminary objections claiming that the objections are a speaking demurrer. The issues have been briefed and argued. The averments in the complaint are that plaintiff, Shank and Associates Real Estate, Inc., d/b/a Prudential Franklin Associates (Prudential) and defendant, Re/Max Realty Agency, Inc. (Re/Max) are licensed real estate brokers. Defendants Craig Schellhase, Jeffrey L. Shatzer, Samuel C. Small, and Steven B. Spray, are all individuals who are either agents or brokers for Re/Max. Plaintiff states causes of action against defendants for breach of contract, tortuous interference with existing contractual relations, tortuous interference with prospective advantage/contractual relations, fraud and civil conspiracy. Plaintiff avers that from September 23, 1999 until July 21, 2003, Schellhase was employed as a sales associate for Prudential. Shatzer was employed by Prudential as a sales associate from May 20, 1997 until February 28, 2003. Both Schellhase and Shatzer terminated their employment with Prudential and transferred to Re/Max. While employed with Prudential, both agents were required to list all properties through plaintiff. Plaintiff alleges that while Schellhase and Shatzer were Prudential employees, they were actively working with and listing properties through Re/Max. Plaintiff alleges that Schellhase, before his resignation on July 21, 2003, Mailed to list properties with Prudential and listed the following properties with Re/Max: 3306 Scotland Road, Chambersburg, PA, listed on June 23, 2003; 131 Fourth Street N., Chambersburg, PA, listed on June 26, 2003; and 8 Field Circle, Chambersburg, PA, listed on July 7, 2003. -2- 03-5294 CIVIL TERM Prudential alleges that Shatzer, before his resignation from Prudential on February 28, 2003, listed with Re/Max on February 11, 2003 the properly located at 7201 Ruritan Drive, Chambersburg, PA. Plaintiff further alleges that there are other properties listed by Schellhase and Shatzer through Re/Max which should have been listed through Prudential, and that Schellhase and Shatzer referred potential customers to Re/Max while under contract with Prudential. In addition, plaintiff alleges that defendant Small, President of and broker for Re/Max, and defendant Spray, Secretary of and broker for Re/Max, accepted the listings from Schellhase and Shatze:r on behalf of Re/Max. Plaintiff alleges that Re/Max received commissions that Prudential was entitled to from the sale of the properties. Defendants aver in their preliminary objections: 6. All of the parties, as licensed real estate agents and/or licensed real estate brokers, are Realtors@ and, as such, have pledged to conduct their business in accordance with the tenets codified in the Code of Ethics and Standards of Practice of the National Association of Realtors@ (hereinafter "Standards of Practice"). 7. The Standards of Practice, specifically pertinent portions of Article 17, provide the following: "In the event of contractual disputes or specific non- contractual disputes as defined in Standard of Practice 17-4 between REALTORS®, the REALTORRS@ shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter.... The obligation to participate in arbitration contemplated by this Article includes the obligation of REALTORS@ (principals) to cause their firms to arbitrate and be bound by any award." 8. Plaintiff has taken no action to submit this matter to arbitration pursuant to the regulations of their Board, namely Pen-Mar Regional Association of Realtors@, which is the Board under those regulations both Plaintiffs and Defendants' practice. -3- 03-5294 CIVIL TERM Defendants maintain that their preliminary objection requiring that plaintiffs claims be submitted to mandatory arbitration should be sustained. Plaintiff, in its preliminary objection to defendants' preliminary objections, argues that the preliminary objections should be dismissed as a "speaking demurrer." Blacks Law Dictionary, 7th ed, defines speaking demurrer as: "A demurrer that cannot be sustained because it introduces new facts not contained in the original complaint." Pursuant to Pa. Rule of Civil Procedure 1028(a), preliminary objections may be filed by any party to any pleading and are limited to the following grounds: (1) lack of jurisdiction over the subject matter of the action or the person of the defendant, improper venue or improper form or service of a writ of summons or a complaint; (2) failure of a pleading to conform to law or rule of court or inclusion of scandalous or impertinent matter; (3) insufficient specificity in a pleading; (4) legal insufficiency of a pleading (demurrer); and (5) lack of capacity to sue, nonjoinder of a necessary party or misjoinder of a cause of action; and (6) pendency of a prior action or agreement for alternative dispute resolution. (Emphasis added). Plaintiff is trying to characterize defendants' preliminary objection as a demurrer under Pa. Rule of Civil Procedure 1028(a)(4) when, in reality it is under Pa. Rule of Civil Procedure 1028(a)(6). This distinction is important because there are two categories of preliminary objections--those raising questions of fact outside the record and those which may be determined from the facts of record. Chester Upland School Dist. v. Yesavage, 653 A.2d 1319 (Pa. Commw.1994). Rule 102:8(c)(2) provides that if an issue of fact is raised, the court shall consider evidence by depositions or otherwise. -4- 03-5294 CIVIL TERM The explanatory note to Rule 1028(c)(2) states: Note: Preliminary objections raising an issue: under subdivision (a)(1), (5) or (6) cannot be determined from facts of record. In such a case, the preliminary objections must be endorsed with a notice to plead or no response will be required under Rule 1029(d). However, preliminary objections raising an issue under subdivision (a)(2), (3) or (4) may be determined from facts of record so that further evidence is not required. Because defendants' preliminary objections are under Rule 1028(a)(6), the explanatory note suggests they may plead facts that were not averred in the complaint as long as they endorsed the preliminary objections with a notice to plead. Defendants did endorse their preliminary objections with a notice to plead. Plaintiff filed a response claiming only that the preliminary objections constituted a speaking demurrer. It did not deny any of the facts pleaded in the preliminary objections. Thus, we will consider the arbitration provision as pleaded by defendants in their preliminary objections.' In Pennsylvania, agreements to conduct litigation in an alternate forum are enforceable. Williams v. Gruntal & Company, 669 A.2d 387 (Pa. Super. 1995). Plaintiff argues that this case should not be submitted to arbitration because it does not fall within the scope of Article 17 of the Code of Ethics, which states: ' We note that in Paragraphs 9 and 10 of its complaint, plaintiff incorporates two identical written contracts, Exhibits A and B, that it entered into with defendants Schellhase and Shatzer, that provide: The SALES ASSOCIATE agrees to conduct his or her business and regulate his or her habits so as to maintain and increase the goodwill and reputation of the BROKER, and the parties hereto agree to abide by and conform to all laws, rules and regulations and THE REALTORS CODE OF ETHICS that are binding upon or applicable to brokers and sales associates. (Emphasis added.) -5- 03-5294 CIVIL TERM In the event of contractual disputes or specific non-contractual disputes as defined in Standard of Practice 17-4 between REALTORS (principals) associated with different firms, arising out of their relationship as REALTORS, the REALTORS shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter. (Emphasis added.) Plaintiff argues that at the time its causes of action arose, defendants Schellhase and Shatzer were still associated with plaintiff; therefore, all were members of Prudential and not associated with different firms. This dispute is between real estate brokers and their agents involving commissions paid to Re/Max and its agents which Prudential claims should have been paid to it even though its agents changed their employment to Re/Max. This is a contractual dispute; between realtors associated with different firms. Plaintiff next argues that this case should not be submitted to arbitration because there are no "contractual disputes or specific non-contractual disputes" between the parties as required by Article 17. While not finding a Pennsylvania case on this issue we note that the Court of Civil Appeals of Oklahoma, in Rogers Realty v. Smith, 76 P.3d 71 (2003), had facts similar to this case in a dispute that arose between realtors over a commission and both parties were members of the National Association of Realtors. The application to become members of the National Association of Realtors required both parties to abide by the Code of Ethics which contained the arbitration clause. The plaintiff, however, argued that arbitration was not mandated because there was no specific contractual agreement between the parties to arbitrate. The Court disagreed and held that, "when realtors voluntarily submit to their organizations' -6- 03-5294 CIVIL TERM authority then they are bound by its rules. The dispute at issue arose out of Plaintiffs and Defendants' relationship as REALTORS and should have been submitted to arbitration pursuant to Article 17 of the Code." Likewise, in the Florida case of Elbadramany v. Stanley, 490 So. 2d 964 (1986), the parties were real estate brokers and members of the Daytona Beach Board of Realtors. The application for membership in the Daytona Beach Board required them to agree to abide by the Code of Ethics of the National Association of Realtors, and both parties agreed to this by signing their applications for membership. A dispute over a commission arose and one party wanted to submit it to arbitration according to the Code of Ethics. The trial court found that there was no written agreement between the parties to arbitrate disputes. However, the District Court of Appeals disagreed, and held that the parties agreed to abide by the Code of Ethics of the National Association of Realtors when they joined the Daytona Beach Board, therefore, the dispute should be submitted to arbitration. Being satisfied that this dispute must be referred to arbitration, we will grant defendants' preliminary objections to the extent that this case shall be stayed pending resolution of the arbitration proceeding. See Schantz v. Dodgeland, 830 A.2d 1265 (Pa. Super. 2003).2 ORDER OF COURT AND NOW, this W? day of April, 2004, IT IS ORDERED: 2 This resolution makes it unnecessary to resolve other preliminary objections filed by defendants. -7- 03-5294 CIVIL TERM (1) The preliminary objections of plaintiff to defendants' preliminary objections, ARE DISMISSED. (2) Defendants' preliminary objection to compel arbitration, IS GRANTED. This case IS STAYED pending the resolution of an arbitration proceeding. By the rt, v' 1 Av,? Edgar B. Bayley, J. David J. Scaggs, Esquire 1800 East Lancaster Avenue Paioli, PA 19301 For Plaintiff James S. Tupitza, Esquire 212 W. Gay Street West Chester, PA 19380 For Defendants :sal -8- MNVAI,k';Ni i 91 cIINV RM401 AW.LQNOHiQUd 301 ,D ? ? n it BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 kDIUJ 04U-/3UU Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 2003-5294 PLAINTIFF'S MOTION FOR RECONSIDERATION AND/OR CLARIFICATION OF THE COURT'S ORDER OF APRIL ,29, 2004 Plaintiff, by its undersigned counsel, does hereby respectfully request this Honorable Court Reconsider its Order of April 29, 2004, and avers as follows: Plaintiff filed its complaint in this matter on October 6, 2003. 2. Plaintiff's complaint contained claims for Breach of Contract, Tortious Interference with Existing Contractual Relations, Tortious Interference with Prospective Advantage/Contractual Relations, Fraud and Civil Conspiracy. 3. Plaintiff's claims involve two distinct issues. First, Plaintiff claims monetary recovery under a simple breach of contract theory in Counts I and II against Defendants Schellhase and Shatzer for commissions that should have been paid to Plaintiff, but instead were wrongfully diverted to another brokerage, while Defendants Sclellhase and Shatzer were still working with Plaintiff. Second, Plaintiff seeks monetary damages under tort theories against all of the defendants, including allegations of Tortious Interference with contractual relationships, fraud and civil conspiracy. These claims are made in the remaining Counts of Plaintiff's Complaint. 4. Defendants filed Preliminary Objections to Plaintiff s Complaint on or about November 14, 2003.1 5. Defendants objected to Plaintiff's complaint on the grounds that, inter alia, Plaintiff's claims were subject to arbitration pursuant to the Code of Ethics and Standards of Practice ("Standards of Practice") of the National Association of Realtors (NAR). Defendants failed to ask for a stay of proceedings, but instead requested dismissal of the Action. 6. Plaintiff filed Preliminary Objections to Defendants' Preliminary Objections on the grounds that Defendants' Preliminary Objections were a speaking demurer, due to the fact that Defendants' Preliminary Objections "went too far" by requesting that Plaintiff's complaint be dismissed, instead of staying the proceeding. Butchko v. Urm!son 65 Pa. D.&C.2.d 395, 1973 WL 15460 (Pa.Com.Pl. 1973). 7. By Order and Opinion dated April 29, 2004, this :Honorable Court dismissed Plaintiff's Preliminary Objections to Defendants' Preliminary Objections and Granted Defendants' Preliminary Objections compelling arbitration, but staying the action meanwhile. (A copy of this Court's Order and Opinion is attached hereto as Exhibit "A") 8. The pertinent section of the Code of Ethics and Standards of Practice ("Standards of Practice") of the NAR regarding arbitration of disputes is as follows: By agreement of counsel, Defendants were granted an extension to respond to Plaintiff's complaint until November 17, 2003. 2 Article 17. As set forth in Article 17, only contractual disputes or non contractual disputes as defined in Standard of Practice 17-4 between REALTORSO (nrincinals), associated with different firms must submit to arbitration." Plaintiffs Brief in Response to Defendants Preliminary Obiections at 6. (emphasis in on ina . 12. The emphasis in the above quoted paragraph is to show that the disputes between the Plaintiff and Shellhase and Schatzer cannot be arbitrated because Shellhase and Schatzer are 1) not REALTORSO (principals) and 2) were not associated with different firms at the time the wrongs were committed. 13. Secondly, even if the Court finds that the commission disputes in Counts I and II must be arbitrated, Plaintiff made other specific non commission claims against Shellhase and Shatzer based on fraud, civil conspiracy and interference with contractual relationships, which cannot possibly be arbitrated in any event as set forth in Article 17 and Standard of Practice 17-4 because they do not meet the specified non contractual disputes defined therein. 4 14. hi other words, while certain disputes alleged in Counts III-IX between the Plaintiff and the Re/Max defendants (Small, Spray and Re/Max), do involve REALTORS associated with different firms, these disputes cannot be arbitrated because they do not involve a contractual dispute between them, but instead seek monetary compensation for fraud, civil conspiracy and interference with contractual matters with third parties. 15. In its simplest form, Article 17 requires arbitration when: 1) there is a contractual dispute between REALTORSO (principals) of different firms, or 2) there is a specific non contractual dispute (which is defined in Standard of Practice 17-4) between REALTORS® (principals) of different firms. 4 There is no dispute that there are no specific non-contractual disputes defined by Standard of Practice 174 that are an issue in this case. 4 16. This Honorable Court, not finding any Pennsylvania case law on the matter relied on the Court of Civil Appeals of Oklahoma in Rogers Realty v. Smith 76 P.3d 71 (2003), which held that when Realtors voluntarily submit to their organizations authority, the constitution and by-laws of that organization becomes a contract between each member and the organization. The Rogers Realtv court, finding such a contract existed, held that therefore the parties were required to arbitrate. 17. This Honorable Court's reliance on Rogers Rea' zX was misplaced. As pointed out in the dissent, while agreeing that the parties' membership in the NAR and their subscription to the Code of Ethics constituted a contract, the majority's analysis did "not adequately examine the impact of that conclusion on whether the terms of the contract... requires arbitration of this dispute." Id. (emphasis in original). The Dissent correctly found that under the majority's interpretation, any dispute between realtors would be covered by arbitration under Article 17, which would render the exclusions contained in Article 17 ineffective. Essentially, the Dissent found that the so-called contract created as a result of being a member of the NAR was not the contract in dispute and therefore, the arbitration provision contained in Article 17, which required a disputed contract between different Brokers, was not met. 18. This Honorable Court, and the Oklahoma Court„ also relied on the District Court of Appeal of Florida in Elbadramanv v. Stanley 490 So.2d 964 (1986), which is factually distinguishable from the case at bar. In Elbadramanv, the arbitration provision in the 1985 NAR Code of Ethics was different from the 2003 version. The 1985 arbitration provision was as follows: Article 14. In the event of a controversy between REALTORS® associated with different firms, arising out of their relationship as REALTORSO, the REALTORSO shall submit the dispute to arbitration in accordance with the regulations of their Board of Boards rather than litigate the matter. 19. In 1985, NAR required "controversies" between REALTORSO associated with different firms be arbitrated. In 2003, NAR only required contractual disputes or specific non- contractual disputes between REALTORSO (principals) be arbitrated. 20. It is illogical to hold that the NAR's requirement: of a contractual dispute is met by being a member of the NAR. Doing so nullifies the inclusion of the word contractual in Article 17. If the NAR actually wanted all disputes between REALTORSO (principals) and/or salespersons to be arbitrated pursuant to Article 17, then not only would it have not used the word contractual, but it would have simply said all disputes between REALTORSO (principals) and/or salespersons must be arbitrated pursuant to Article 17 - as it did in 1985. Instead, NAR made specific efforts to carve out very limited circumstances in which it believed it would be capable of conducting arbitration of certain disputes between its members. 21. In further support of Plaintiff's position that, arbitrators (Realtors) cannot be qualified to act as judge and jury on such complicated claims as fraud, Tortious interference and/or conspiracy, the NAR's 2003 Code of Ethics and Arbitration Manual, Part 10, Section 45, states: If either the Grievance Committee or the arbitration panel selected in the manner hereinafter provided determine that because of the amount involved or the legal complexity of the dispute the dispute should not be arbitrated, the arbitration shall automatically terminate unless either of the parties to the dispute appeals the decision to terminate the proceedings to the Board of Directors... The H earing Panel can also dismiss the arbitration request if the Hearing Panel concludes the matter is not arbitrable. The written appeal and those materials and information which were available to the Grievance Committee or the arbitration Hearing Panel when the decision to discontinue arbitration was made will be presented to the Directors and considered with the appeal. The complainant and respondent do not have the right to appear at the hearing before the Directors. In the event of such an appeal, the Grievance Committee or the arbitration panel shall report its conclusions in writing to the Directors and, if the Directors concur, the arbitration shall terminate and the parties shall be relieved of their obligation to arbitrate. WHEREFORE, Plaintiff respectfully requests that this Honorable Court Reconsider its Order of April 29, 2004 and Overrule Defendants' Preliminary Objections and Order Defendants to Answer Plaintiff's Complaint or at a minimum, remand the matter for arbitration only for those commission claims between Plaintiff and Shellhase and Schatzer as set forth in Counts I and II, with the remaining allegations stayed until arbitration on the commission issues is resolved. Date" By .C. ,, . SHANK AND ASSOCIATES REAL ESTATE, INC., d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V. CRAIG SCHELLHASE, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., JEFFREY L. SHATZER, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., SAMUEL C. SMALL, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., STEVEN B. SPRAY, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC. AND RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 03-5294 CIVIL TERM IN RE: PRELIMINARY OBJECTIONS OF DEF=ENDANTS TO PLAINTIFF'S COMPLAINT AND PLAINTIFF'S PRELIMINARY OBJECTION TO DEFENDANTS' PRELIMINARY OBJECTIONS BEFORE BAYLEY, J. ORDER OF COURT AND NOW, this day of April, 2004, IT IS ORDERED: (1) The preliminary objections of plaintiff to defendants' preliminary objections, ARE DISMISSED. (2) Defendants' preliminary objection to compel arbitration, IS GRANTED. This case IS STAYED pending the resolution of an arbitration proceeding. 03-5294 CIVIL TERM David J. Scaggs, Esquire 1800 East Lancaster Avenue _-P2ioji_PA 19301 For Plaintiff James S. Tupitza, Esquire 212 W. Gay Street West Chester, PA 19380 For Defendants :sal By the Edgar B. Bayley, J. TRUE COPY In Testimony whereo and 0e seal of said t FROM RECORD I hers unto set my hand urtlat,orliala, Pa. SHANK AND ASSOCIATES REAL ESTATE, INC., d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V CRAIG SCHELLHASE, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., JEFFREY L. SHATZER, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., SAMUEL C. SMALL, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., STEVEN B. SPRAY, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC. AND RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT" OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 03-5294 CIVIL TERM IN RE: PRELIMINARY OBJECTIONS OF DEFENDANTS TO PLAINTIFF'S COMPLAINT AND PLAINTIFF'S PRELlIIAINARY OBJECTION TO DEFENDANTS' PRELIMINARY OBJECTIONS BEFORE BAYLEY, J. OPINION AND ORDER OF COURT Bayley, J., April 29, 2004:-- Plaintiff filed a complaint on October 6, 2003. Defendants filed preliminary objections to dismiss the complaint on the grounds that plaintiff's claims were subject to mandatory arbitration pursuant to the Code of Ethics and Standards of Practice of the National Association of Realtors. Plaintiff filed preliminary objections to defendants' 03-5294 CIVIL TERM preliminary objections claiming that the objections are a speaking demurrer. The issues have been briefed and argued. The averments in the complaint are that plaintiff, Shank and Associates Real Estate, Inc., d/b/a Prudential Franklin Associates (Prudential) and defendant, Re/Max Realty Agency, Inc. (Re/Max) are licensed real estate brokers. Defendants Craig Schellhase, Jeffrey L. Shatzer, Samuel C. Small, and Steven B. Spray, are all individuals who are either agents or brokers for Re/Max. Plaintiff states causes of action against defendants for breach of contract, tortuous interference with existing contractual relations, tortuous interference with prospective advantage/contractual relations, fraud and civil conspiracy. Plaintiff avers that from September 23, 1999 until July 21, 2003, Schellhase was employed as a sales associate for Prudential. Shatzer was employed by Prudential as a sales associate from May 20, 1997 until February 28, 2003. Both Schellhase and Shatzer terminated their employment with Prudential and transferred to Re/Max. While employed with Prudential, both agents were required to list all properties through plaintiff. Plaintiff alleges that while Schellhase and Shatzeir were Prudential employees, they were actively working with and listing properties through Re/Max. Plaintiff alleges that Schellhase, before his resignation on July 21, 2003, failed to list properties with Prudential and listed the following properties with Re/Max: 3306 Scotland Road, Chambersburg, PA, listed on June 23, 2003; 131 Fourth Street N., Chambersburg, PA, listed on June 26, 2003; and 8 Field Circle, Chambersburg, PA, listed on July 7, 2003. -2- 03-5294 CIVIL TERM Prudential alleges that Shatzer, before his resignation from Prudential on February 28, 2003, listed with Re/Max on February 11, 2003 the property located at 7201 Ruritan Drive, Chambersburg, PA. Plaintiff further alleges that there are other properties listed by Schellhase and Shatzer through Re/Max which should have been listed through Prudential, and that Schellhase and Shatzer referred potential customers to Re/Max while under contract with Prudential. In addition, plaintiff alleges that defendant Small, President of and broker for Re/Max, and defendant Spray, Secretary of and broker for Re/Max, accepted the listings from Schellhase and Shatzer on behalf of Re/Max. Plaintiff alleges that Re/Max received commissions that Prudential was entitled to from the sale of the properties. Defendants aver in their preliminary objections: 6. All of the parties, as licensed real estate agents and/or licensed real estate brokers, are Realtors@ and, as such, have pledged to conduct their business in accordance with the tenets codified in the Code of Ethics and Standards of Practice of the National Association of Realtors@ (hereinafter "Standards of Practice"). 7. The Standards of Practice, specifically pertinent portions of Article 17, provide the following: "In the event of contractual disputes or specific non- contractual disputes as defined in Standard of Practice 17-4 between REALTORS, the REALTORS@ shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter.... The obligation to participate in arbitration contemplated by this Article includes the obligation of REALTORS@ (principals) to cause their firms to arbitrate and be bound by any award." 8. Plaintiff has taken no action to submit this matter to arbitration pursuant to the regulations of their Board, namely Pen-Mar Regional Association of RealtorsO, which is the Board under those regulations both Plaintiffs and Defendants' practice. -3- 03-5294 CIVIL TERM Defendants maintain that their preliminary objection requiring that plaintiffs claims be submitted to mandatory arbitration should be sustained. Plaintiff, in its preliminary objection to defendants' preliminary objections, argues that the preliminary objections should be dismissed as a "speaking demurrer." Blacks Law Dictionary, Tin ed, defines speaking demurrer as: "A demurrer that cannot be sustained because it introduces new facts not contained in the original complaint." Pursuant to Pa. Rule of Civil Procedure 1028(a), preliminary objections may be filed by any party to any pleading and are limited to the following grounds: (1) lack of jurisdiction over the subject matter of the action or the person of the defendant, improper venue or improper form or service of a writ of summons or a complaint; (2) failure of a pleading to conform to law or rule of court or inclusion of scandalous or impertinent matter; (3) insufficient specificity in a pleading; (4) legal insufficiency of a pleading (demurrer); and (5) lack of capacity to sue, nonjoinder of a necessary party or misjoinder of a cause of action; and (6) pendency of a prior action or agreement for alternative dispute resolution. (Emphasis added). Plaintiff is trying to characterize defendants' preliminary objection as a demurrer under Pa. Rule of Civil Procedure 1028(a)(4) when, in reality it is under Pa. Rule of Civil Procedure 1028(a)(6). This distinction is important because there are two categories of preliminary objections--those raising questions of fact outside the record and those which may be determined from the facts of record. Chester Upland School Dist. v. Yesavage, 653 A.2d 1319 (Pa. Commw.1994). Rule 1028(c)(2) provides that if an issue of fact is raised, the court shall consider evidence by depositions or otherwise. -4- 03-5294 CIVIL TERM The explanatory note to Rule 1028(c)(2) states: Note: Preliminary objections raising an issue: under subdivision (a)(1), (5) or (6) cannot be determined from facts of record. In such a case, the preliminary objections must be endorsed with a notice to plead or no response will be required under Rule 1029(d). However, preliminary objections raising an issue under subdivision (a)(2), (3) or (4) may be determined from facts of record so that further evidence is not required. Because defendants' preliminary objections are under Rule 1028(a)(6), the explanatory note suggests they may plead facts that were not averred in the complaint as long as they endorsed the preliminary objections with a notice to plead. Defendants did endorse their preliminary objections with a notice to plead. Plaintiff filed a response claiming only that the preliminary objections constituted a speaking demurrer. It did not deny any of the facts pleaded in the preliminary objection;. Thus, we will consider the arbitration provision as pleaded by defendants in their preliminary objections.' In Pennsylvania, agreements to conduct litigation in an alternate forum are enforceable. Williams v. Gruntal & Company, 669 A.2d 387 (Pa. Super. 1995). Plaintiff argues that this case should not be submitted to arbitration because it does not fall within the scope of Article 17 of the Code of Ethics, which states: ' We note that in Paragraphs 9 and 10 of its complaint, plaintiff incorporates two identical written contracts, Exhibits A and B, that it entered into with defendants Schellhase and Shatzer, that provide: The SALES ASSOCIATE agrees to conduct his or her business and regulate his or her habits so as to maintain and increase the goodwill and reputation of the BROKER, and the parties hereto agree to abide by and conform to all laws, rules and regulations and THE REALTORS CODE OF ETHICS that are binding upon or applicable to brokers and sales associates. (Emphasis added.) -5- 03-5294 CIVIL TERM In the event of contractual disputes or specific non-contractual disputes as defined in Standard of Practice 17-4 between REALTORS (principals) associated with different firms, arising out of their relationship as REALTORS, the REALTORS shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter. (Emphasis added.) Plaintiff argues that at the time its causes of action arose, defendants Schellhase and Shatzer were still associated with plaintiff; therefore, all were members of Prudential and not associated with different firms. This dispute is between real estate brokers and their agents involving commissions paid to Re/Max and its agents which Prudential claims should have been paid to it even though its agents changed their employment to Re/Max. This is a contractual dispute between realtors associated with different firms. Plaintiff next argues that this case should not be submitted to arbitration because there are no "contractual disputes or specific non-contractual disputes" between the parties as required by Article 17. While not finding a Pennsylvania case on this issue we note that the Court of Civil Appeals of Oklahoma, in Rogers Realty v. Smith, 76 P.3d 71 (2003), had facts similar to this case in a dispute that arose between realtors over a commission and both parties were members of the National Association of Realtors. The application to become members of the National Association of Realtors required both parties to abide by the Code of Ethics which contained the arbitration clause. The plaintiff, however, argued that arbitration was not mandated because there was no specific contractual agreement between the parties to arbitrate. The Court disagreed and held that, "when realtors voluntarily submit to their organizations' -6- 03-5294 CIVIL TERM authority then they are bound by its rules. The dispute at issue arose out of Plaintiffs and Defendants' relationship as REALTORS and should have been submitted to arbitration pursuant to Article 17 of the Code." Likewise, in the Florida case of Elbadramany v. Stanley, 490 So. 2d 964 (1986), the parties were real estate brokers and members of the Daytona Beach Board of Realtors. The application for membership in the Daytona Beach Board required them to agree to abide by the Code of Ethics of the National Association of Realtors, and both parties agreed to this by signing their applications for membership. A dispute over a commission arose and one party wanted to submit it to arbitration according to the Code of Ethics. The trial court found that there was no written agreement between the parties to arbitrate disputes. However, the District Court of Appeals disagreed, and held that the parties agreed to abide by the Code of Ethics of the National Association of (Realtors when they joined the Daytona Beach Board, therefore, the dispute should be submitted to arbitration. Being satisfied that this dispute must be referred to arbitration, we will grant defendants' preliminary objections to the extent that this case shall be stayed pending resolution of the arbitration proceeding. See Schantz v. Dodgeland, 830 A.2d 1265 (Pa. Super. 2003).2 ORDER OF COURT AND NOW, this cl9A?k, day of April, 2004, IT IS ORDERED: 2 This resolution makes it unnecessary to resolve other preliminary objections filed by defendants. -7- 03-5294 CIVIL TERM (1) The preliminary objections of plaintiff to defendants' preliminary objections, ARE DISMISSED. (2) Defendants' preliminary objection to compel arbitration, IS GRANTED. This case IS STAYED pending the resolution of an arbitration proceeding. By the rt, ,r ,1 Cnv,? Edgar B. Bayley, J. David J. Scaggs, Esquire 1800 East Lancaster Avenue Paioli, PA 19301 For Plaintiff James S. Tupitza, Esquire 212 W. Gay Street West Chester, PA 19380 For Defendants .'sal -8- -ph4 M • w . I . y n o O C._ c3 ^tl ? N G(7 ?^ lti ? BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 04U-/JUU Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants Attorneys for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 2003-5294 APPLICATION FOR AMENDMENT OF INTERLOCUTORY ORDER ENTERED ON APRIL 29, 2004 TO SET FORTH EXPRESSLY THE STATEMENT SPECIFIED BY 42 PA.C.S.A.§702(b) Plaintiff, by its undersigned counsel, does hereby respectlblly Apply to this Honorable Court to Amend its Order of April 29, 2004, to set forth expressly the statement specified by 42 Pa.C.S.A. §702(b), and avers as follows: Plaintiff filed its complaint in this matter on October 6, 2003. 2. Defendants filed Preliminary Objections to Plaintiffs Complaint on or about November 14, 2003. 3. On April 29, 2004, this Honorable Court entered an Interlocutory Order (and Opinion) granting Defendants' Preliminary Objections and ordered Plaintiff's claims to be arbitrated pursuant to the Code of Ethics and Standards of Practice ("Standards of Practice") of the National Association of Realtors (NAR), with this matter stayed meanwhile. (A copy of the Order and Opinion are attached hereto as Exhibit "A". 1 4. "An order directing arbitration, whether statutory or common law, is an interlocutory order and is not immediately appealable." Rosy National Grange Mut Ins Co 771 A.2d 60, 61 (Pa.Super,2001) 5. Pursuant to Pa.R.A.P. 1311 (Interlocutory Appeals by Permission), Plaintiff may apply to the lower Court for an amendment of its interlocutory Order to contain the statement prescribed by 42 Pa.C.S. §702(b), within thirty (30) days after entry of such Order by the lower court. 6. Pursuant to the Pa.R.A.P. 1311, unless the Court acts on this Application within thirty (30) days after this filing, this Application shall be deemed denied and Plaintiff will be required to file a Petition for Review under Chapter 15 of the Pennsylvania Rules of Appellate Procedure. 42 Pa.C.S. §702(b) states as follows: Interlocutory appeals by permission.--When a court or other government unit, in making an interlocutory order in a matter in which its final order would be within the jurisdiction of an appellate court, shall be of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the matter, it shall so state in such order. The appellate court may thereupon, in its discretion, permit an appeal to be taken from such interlocutory order. (emphasis added. 'A Motion for Reconsideration of this Court's April 29, 2004 Order was filed on or about May 10, 2004. 2 S. The main issue in this case and in this Court's opinion is whether Plaintiff s claims against its then employees and Plaintiffs claims against another broker (in which there were no contractual disputes), must be arbitrated under the Code of Ethics and Standards of Practice of the National Association of Realtors 9. In its Opinion of April 29, 2004, this Honorable Court has found that there is no controlling Pennsylvania case law on the issue that is the subject of this Court's Opinion, and therefore these issues are issues of first impression in Pennsylvania. 10. These issues are a controlling question of law as to which there is substantial ground for difference of opinion and an immediate appeal from this Court's Order may materially advance the ultimate termination of this matter. WHEREFORE, Plaintiff hereby respectfully requests that this Honorable Court amend its order of April 29, 2004 to include a statement pursuant to 42 Pa.C.S. §702(b) and Pa.R.A.P. 1311 that such Order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the matter. .C. Date: / cl - 01 By SHANK AND ASSOCIATES REAL IN THE COURT OF COMMON PLEAS OF ESTATE, INC., d/b/a THE CUMBERLAND COUNTY, PENNSYLVANIA PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V. CRAIG SCHELLHASE, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., JEFFREY L. SHATZER, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., SAMUEL C. SMALL, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., STEVEN B. SPRAY, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC. AND RE/MAX REALTY AGENCY, INC., DEFENDANTS 03-5294 CIVIL TERM IN RE: PRELIMINARY OBJECTIONS OF DEFEND- ALTO DEFENDANTS' PRELIMINARY OBJECTIONS BEFORE BAYLEY J. n ORDER OF COURT AND NOW, this qu, day of April, 2004, IT IS ORDERED: (1) The preliminary objections of plaintiff to defendants' preliminary objections, ARE DISMISSED. (2) Defendants' preliminary objection to compel arbitration, IS GRANTED. This case IS STAYED pending the resolution of an arbitration proceeding. 03-5294 CIVIL TERM By the Gt Edgar B. Bayley, J. David J. Scaggs, Esquire 1800 East Lancaster Avenue Paioli _ PA 19301 For Plaintiff James S. Tupitza, Esquire 212 W. Gay Street West Chester, PA 19380 For Defendants :sal TRUI* CQPy FROM "RECORD (n Testimony whereof 1 here unto set my hand and the sealof said ?ourtfat4rlisle, Pa. SHANK AND ASSOCIATES REAL ESTATE, INC., d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V CRAIG SCHELLHASE, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., JEFFREY L. SHATZER, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., SAMUEL C. SMALL, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., STEVEN B. SPRAY, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC. AND RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 03-5294 CIVIL TERM IN RE: PRELIMINARY OBJECTIONS OF DEFENDANTS TO DEFENDANTS' PRELIMINARY OBJECTIONS BEFORE BAYLEY J. OPINION AND ORDER OF COURT Bayley, J., April 29,2004:-- Plaintiff filed a complaint on October 6, 2003. Defendants filed preliminary objections to dismiss the complaint on the grounds that plaintiffs claims were subject to mandatory arbitration pursuant to the Code of Ethics and Standards of Practice of the National Association of Realtors. Plaintiff filed preliminary objections to defendants' 03-5294 CIVIL TERM preliminary objections claiming that the objections are a speaking demurrer. The issues have been briefed and argued. The averments in the complaint are that plaintiff, Shank and Associates Real Estate, Inc., d/b/a Prudential Franklin Associates (Prudential) and defendant, Re/Max Realty Agency, Inc. (Re/Max) are licensed real estate brokers. Defendants Craig Schellhase, Jeffrey L. Shatzer, Samuel C. Small, and Steven B. Spray, are all individuals who are either agents or brokers for Re/Max. Plaintiff states causes of action against defendants for breach of contract, tortuous interference with existing contractual relations, tortuous interference with prospective advantage/contractual relations, fraud and civil conspiracy. Plaintiff avers that from September 23, 1999 until July 21, 2003, Schellhase was employed as a sales associate for Prudential. Shatzer was employed by Prudential as a sales associate from May 20, 1997 until February 28, 2003. Both Schellhase and Shatzer terminated their employment with Prudential and transferred to Re/Max. While employed with Prudential, both agents were required to list all properties through plaintiff. Plaintiff alleges that while Schellhase and Shatzer were Prudential employees, they were actively working with and listing properties through Re/Max. Plaintiff alleges that Schellhase, before his resignation on July 21, 2003, failed to list properties with Prudential and listed the following properties with Re/Max: 3306 Scotland Road, Chambersburg, PA, listed on June 23, 2003; 131 Fourth Street N., Chambersburg, PA, listed on June 26, 2003; and 8 Field Circle, Chambersburg, PA, listed on July 7, 2003. -2- 03-5294 CIVIL TERM Prudential alleges that Shatzer, before his resignation frorn Prudential on February 28, 2003, listed with Re/Max on February 11, 2003 the property located at 7201 Ruritan Drive, Chambersburg, PA. Plaintiff further alleges that there are other properties listed by Schellhase and Shatzer through Re/Max which should have been listed through Prudential, and that Schellhase and Shatzer referred potential customers to Re/Max while under contract with Prudential. In addition, plaintiff alleges that defendant Small, President of and broker for Re/Max, and defendant Spray;, Secretary of and broker for Re/Max, accepted the listings from Schellhase and Shatter on behalf of Re/Max. Plaintiff alleges that Re/Max received commissions that Prudential was entitled to from the sale of the properties. Defendants aver in their preliminary objections: 6. All of the parties, as licensed real estate agents and/or licensed real estate brokers, are Realtors® and, as such, have pledged to conduct their business in accordance with the tenets codified in the Code of Ethics and Standards of Practice of the National Association of Realtors® (hereinafter "Standards of Practice"). 7. The Standards of Practice, specifically pertinent portions of Article 17, provide the following: "in the event of contractual disputes or specific non- contractual disputes as defined in Standard of Practice 17-4 between REALTORS, the REALTORS® shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter.... The obligation to participate in arbitration contemplated by this Article includes the obligation of REALTORS@ (principals) to cause their firms to arbitrate and be bound by any award." 8. Plaintiff has taken no action to subunit this matter to arbitration pursuant to the regulations of their Board, namely Pen-Mar Regional Association of Realtors®, which is the Board under those regulations both Plaintiffs and Defendants' practice. -3- 03-5294 CIVIL TERM Defendants maintain that their preliminary objection requiring that plaintiffs claims be submitted to mandatory arbitration should be sustained. Plaintiff, in its preliminary objection to defendants' preliminary objections, argues that the preliminary objections should be dismissed as a "speaking demurrer." Blacks Law Dictionary, 7t' ed, defines speaking demurrer as: "A demurrer that cannot be sustained because it introduces new facts not contained in the original complaint." Pursuant to Pa. Rule of Civil Procedure 1028(a), preliminary objections may be filed by any party to any pleading and are limited to the following grounds: (1) lack of jurisdiction over the subject matter of the action or the person of the defendant, improper venue or improper form or service of a writ of summons or a complaint; (2) failure of a pleading to conform to law or rule of court or inclusion of scandalous or impertinent matter; (3) insufficient specificity in a pleading; (4) legal insufficiency of a pleading (demurrer); and (5) lack of capacity to sue, nonjoinder of a necessary party or misjoinder of a cause of action; and (6) pendency of a prior action or agreement for alternative dispute resolution. (Emphasis added). Plaintiff is trying to characterize defendants' preliminary objection as a demurrer under Pa. Rule of Civil Procedure 1028(a)(4) when, in reality it is under Pa. Rule of Civil Procedure 1028(a)(6). This distinction is important because there are two categories of preliminary objections--those raising questions of fact outside the record and those which may be determined from the facts of record. Chester Upland School Dist. v. Yesavage, 653 A.2d 1319 (Pa. Commw.1994). Rule 1028(c)(2) provides that if an issue of fact is raised, the court shall consider evidence by depositions or otherwise. -4- 03-5294 CIVIL TERM The explanatory note to Rule 1028(c)(2) states: Note: Preliminary objections raising an issue under subdivision (a)(1), (5) or (6) cannot be determined from facts of record. In such a case, the preliminary objections must be endorsed with a notice to plead or no response will be required under Rule 1029(d). However, preliminary objections raising an issue under subdivision (a)(2), (3) or (4) may be determined from facts of record so that further evidence is not required. Because defendants' preliminary objections are under Rule 1028(a)(6), the explanatory note suggests they may plead facts that were not averred in the complaint as long as they endorsed the preliminary objections with a notice to plead. Defendants did endorse their preliminary objections with a notice to plead. Plaintiff filed a response claiming only that the preliminary objections constituted a speaking demurrer. It did not deny any of the facts pleaded in the preliminary objections. Thus, we will consider the arbitration provision as pleaded by defendants in their preliminary objections.' In Pennsylvania, agreements to conduct litigation in an alternate forum are enforceable. Williams v. Gruntal & Company, 669 A.2d 387 (Pa. Super. 1995). Plaintiff argues that this case should not be submitted to arbitration because it does not fall within the scope of Article 17 of the Code of Ethics, which states: T We note that in Paragraphs 9 and 10 of its complaint, plaintiff incorporates two identical written contracts, Exhibits A and B, that it entered) into with defendants Schellhase and Shatzer, that provide: The SALES ASSOCIATE agrees to conduct his or her business and regulate his or her habits so as to maintain and increase the goodwill and reputation of the BROKER, and the parties hereto agree to abide by and conform to all laws, rules and regulations and THE REALTORS CODE OF ETHICS that are binding sales associates. (Emphasis added upon or applicable to brokers and -5- 03-5294 CIVIL TERM In the event of contractual disputes or specific non-contractual disputes as defined in Standard of Practice 17-4 between REALTORS (principals) associated with different firms, arising out of their relationship as REALTORS, the REALTORS shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter. (Emphasis added.) Plaintiff argues that at the time its causes of action arose, defendants Schellhase and Shatzer were still associated with plaintiff; therefore, all were members of Prudential and not associated with different firms. This dispute is between real estate brokers and their agents involving commissions paid to Re/Max and its agents which Prudential claims should have been paid to it even though its agents changed their employment to Re/Max. This is a contractual dispute between realtors associated with different firms. Plaintiff next argues that this case should not be submitted to arbitration because there are no "contractual disputes or specific non-contractual disputes" between the parties as required by Article 17. While not finding a Pennsylvania case on this issue we note that the Court of Civil Appeals of Oklahoma, in Rogers Realty v. Smith, 76 P.3d 71 (2003), had facts similar to this case in a dispute that arose between realtors over a commission and both parties were members of the National Association of Realtors. The application to become members of the National Association of Realtors required both parties to abide by the Code of Ethics which contained the arbitration clause. The plaintiff, however, argued that arbitration was not mandated because there was no specific contractual agreement between the parties to arbitrate. The Court disagreed and held that, "when realtors voluntarily submit to their organizations' -6- 03-5294 CIVIL TERM authority then they are bound by its rules. The dispute at issue arose out of Plaintiffs and Defendants' relationship as REALTORS and should have been submitted to arbitration pursuant to Article 17 of the Code." Likewise, in the Florida case of Elbadramany v. Stanley, 490 So. 2d 964 (1986), the parties were real estate brokers and members of the Daytona Beach Board of Realtors. The application for membership in the Daytona Beach Board required them to agree to abide by the Code of Ethics of the National Association of Realtors, and both parties agreed to this by signing their applications for membership. A dispute over a commission arose and one party wanted to submit it to arbitration according to the Code of Ethics. The trial court found that there was no written agreement between the parties to arbitrate disputes. However, the District Court of Appeals disagreed, and held that the parties agreed to abide by the Code of Ethics of the National Association of Realtors when they joined the Daytona Beach Board, therefore, the dispute should be submitted to arbitration. Being satisfied that this dispute must be referred to arbitration, we will grant defendants' preliminary objections to the extent that this case shall be stayed pending resolution of the arbitration proceeding. See Schantz v. Dodgeland, 830 A.2d 1265 (Pa. Super. 2003).2 ORDER OF COURT AND NOW, this d9 day of April, 2004, IT IS ORDERED: F This resolution makes it unnecessary to resolve other preliminary objections filed by defendants. -7- 03-5294 CIVIL TERM (1) The preliminary objections of plaintiff to defendants' preliminary objections, ARE DISMISSED. (2) Defendants' preliminary objection to compel arbitration, IS GRANTED. This case IS STAYED pending the resolution of an arbitration proceeding. By the rt, ,r ? Cnv1? Edgar B. Bayley, J. 6 David J. Scaggs, Esquire 1800 East Lancaster Avenue Paioli, PA 19301 For Plaintiff James S. Tupitza, Esquire 212 W. Gay Street West Chester, PA 19380 For Defendants .'sal -8- U • S ni-n cra -? BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 640-7500 : and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants ror riaimin CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW ?3-saq??? ?? I DOCKET NO.:- CERTIFICATE OF SERVICE I, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Application for Amendment of Interlocutory Order Entered on April 29, 2004 to Set Forth Expressly the Statement Specified by 42 Pa.C.S.A. §702(b) with proposed Order, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 C. Date: By: ? ?? C,? `-' G ?T ?; ? ? 1' 0.? -.- -['71T1 ; _- . _? r? 1 1? `?a .:: G.> f.J try s'rt 3 ,a ? ? ?, =< SHANK AND ASSOCIATES REAL ESTATE, INC., d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V. CRAIG SCHELLHASE, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., JEFFREY L. SHATZER, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., SAMUEL C. SMALL, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., STEVEN B. SPRAY, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC. AND RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 03-5294 CIVIL TERM IN RE: PLAINTIFF'S MOTION FOR RECONSIDERATION AND/OR CLARIFICATION OF THE COURT'S ORDER OF APRIL 29. 2004 ORDER OF COURT AND NOW, this Z day of May, 2004, the motion of plaintiff for reconsideration and/or clarification of the court's order of April 29, 2 IS DENIED.' By the Court, 1)'6 Ail A 0 Edgar B. ' As explained in the opinion in support of the order of April 29, 2004, +ile plaintiff's real estate agency has added to its count for breach of contract causes of action for tortuous interference with existing contractual relations, tortuous interference with prospective advantage/contractual relations, fraud and civil conspiracy, the genius of its complaint is that, as a result of the conduct of its agents, it is due commissions on sales of real estate that were paid instead to defendant, Re/Max Realty Agency, Inc., a part of which went to those agents who transferred to Re/Max. Either the commissions were payable to Re/Max or the plaintiff. Categorizing the alleged breaches of contract in terms of other causes of action and naming the agents as defendants does not change the essence of this simple lawsuit which is subject to mandatory arbitration. Y N'VAlks1o tlt i? 10 :q Bdd SZ Avw hOoz Aatii ?hlUH1C1?'d 3Hi ?o 1O1?ta0 0311.1 David J. Scaggs, Esquire 1800 East Lancaster Avenue Paioli, PA 19301 For Plaintiff James S. Tupitza, Esquire 212 W. Gay Street West Chester, PA 19380 For Defendants :sal SHANK AND ASSOCIATES REAL ESTATE, INC., d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V. CRAIG SCHELLHASE, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., JEFFREY L. SHATZER, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., SAMUEL C. SMALL, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC., STEVEN B. SPRAY, INDIVIDUALLY AND AS AGENT FOR RE/MAX REALTY AGENCY, INC. AND RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 03-5294 CIVIL TERM STATEMENT SPECIFIED BY 42 PA.C S.A. J702 U ORDER OF COURT AND NOW, this day of May, 2004, plaintiffs application for amendment of interlocutory order entered on April 2fi, 2004, to set forth expressly the statement specified by 42 Pa.C.S.A. § 702(b), IS DENIED. By the Court, Edgar o?"a , ZZ - Luca)- C\j U=:;! iL ? ? L4 rVS P' J lV ! l r David J. Scaggs, Esquire 1800 East Lancaster Avenue Paioli, PA 19301 For Plaintiff James S. Tupitza, Esquire 212 W. Gay Street West Chester, PA 19380 For Defendants :sal TUPITZA & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-5294 DEFENDANTS' RESPONSE TO PLAINTIFF'S APPLICATION FOR AMENDMENT OF INTERLOCUTORY ORDER ENTERED ON APRIL 29 2004 TO SET FORTH EXPRESSLY THE STATEMENT SPECIFIED BY 42 PA. C.S.A. !' 702(b) Defendants, by their counsel, respectfully respond to Plaintiffs Application for Amendment of Interlocutory Order Entered on April 29, 2004 to Set Forth Expressly the Statement Specified by 42 Pa. C.S.A. 702(b) as follows: 1-7. Paragraphs 1 through 7 are either admitted or are conclusions of law to which no responsive pleading is necessary. 8. It is denied that the main issue in the case is whether or not the Plaintiffs claim against its then employees and against another broker must be arbitrated under the Code of Ethics. Rather, this is really a claim by one broker against another broker and the employees of that other broker. The fact that the employees at one point used to be the employees of the Plaintiff is not relevant. They are currently employed by another broker. 9. The Court's Order speaks for itself. 10. The Defendants deny that there is substantial ground for difference of opinion. All of the parties are bound by the Code of Ethics and the standards of practice of the National Association of Realtors@) since each and every one of the parties is a Realtor. That includes both brokers and both of the individual employees of the Defendant, Re/Max Realty Agency, Inc. WHEREFORE, Defendants, by their counsel, respectfully request that this Court not amend its Order as requested by the Plaintiff. Respectfully submitted, Jame 5fe , Es quire Atto ey for ndants TUPITZA & BRYMAN, P.C. Attorney for Defendants By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 SHANK AND ASSOCIATES IN THE OUR COUNTY, COMMON PLEAS REAL ESTATE, INC. d/b/a PENNA. PRUDENTIAL FRANKLIN CIVIL ACTION - LAW ASSOCIATES, PLAINTIFF NO. 03-5294 VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS CERTIFICATE OF SERVI(:E I hereby certify I am this date serving a copy of the attached Defendant's Response to Plaintiffs Application for Amendment of Interlocutory Order Entered on April 29, 2004, upon the following persons in the manner indicated below: Honorable Edgar B. Bayley Cumberland County Courthouse One Courthouse Square Carlisle, PA 17013 Via First Class Mail Blair H. Granger, Esquire David J. Scaggs, Esquire Via Facsimile #610-640-7505 Attorneys for Plaintiff Date: ? - 0 - 0 I Respectfully submitted, ti C? G O cn ? _ i T c' ? -?? _?_t ?i ?n N - r ? ...? ?r C 4. ?._. ?+.? it '-C Sr1 n' G 1 ..? TUPITZA & BRYMAN, P.C. Attorney for Defendants By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 SHANK AND ASSOCIATES IN THE COURT OF COMMON PLEAS REAL ESTATE, INC. d/b/a CUMBERLAND COUNTY, PENNA. THE PRUDENTIAL FRANKLIN CIVIL ACTION - LAW ASSOCIATES, PLAINTIFF NO. 03-268T 5-2 1 y vs. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS CERTIFICATE OF SERVICE I hereby certify I am this date serving a copy of the attached Preliminary Objections of Defendants and supporting Memorandum of Law upon the following person by First Class Mail addressed as follows: Honorable Edgar B. Bayley Cumberland County Courthouse One Courthouse Square Carlisle, PA 17013-3387 Blair H. Granger, Esquire David J. Scaggs, Esquire 1800 E. Lancaster Avenue Paoli, PA 19301 Attorney for Plaintiff Date: Resp?tfirNy submitted, i? James upi a, Esquire Attorney for D Pendants t ?? ? , Ct ? TUPITZA & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF vs. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-268 ' 9 y NOTICE OF FILING OF AMENDED PRELIMINARY OBJECTIONS TO THE PLAINTIFF: Notice is hereby given that Defendants, by and through their attorney, James S. Tupitza, Esquire, have filed Amended Preliminary Objections in the Office of the Prothonotary of Cumberland County, Pennsylvania, on April 7, 2006. The Court has directed that any responsive brief to the Amended Preliminary Objections be filed on or before April 21, 2006. Respectfully submitted, Ja es S. Tupitza, Esquire Attorney for Defendants 2 TUPITZA & BRYMAN, P.C. By: James S. Tupitza, Esquire Identification No.: 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF vs. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-2&&T- S2 9y DEFENDANTS' AMENDED PRELIMINARY OBJECTIONS TO PLAINTIFF'S COMPLAINT Defendants, Craig Schellhase, Jeffrey L. Shatzer, Samuel C. Small, Steven B. Spray, and Re/Max Realty Agency, Inc., by and through their undersigned counsel, after having received leave from this Honorable Count to do so, hereby files their Amended Preliminary Objections, and in support thereof, allege as follows: 1. AVERMENTS RELEVANT TO ALL PARTS OF THESE PRELIMINARY OBJECTIONS. 1. Plaintiff is a Pennsylvania Corporation licensed to do business in the Commonwealth of Pennsylvania as a real estate broker under the fictitious name of "The Prudential Franklin Associates" with a place of business at 946 Lincoln Way East, Chambersburg, Pennsylvania 17201. 2. Defendant, Re/Max Realty Agency, Inc. is a Pennsylvania Corporation licensed to do business in the Commonwealth of Pennsylvania with a place of business at 1132 Kennebec Drive, Chambersburg, PA 17201. 3. Defendants, Craig Schellhase, Jeffrey L. Shatzer, Samuel C. Small and Steven B. Spray, are all individuals who are either agents and/or brokers for Re/Max Realty Agency. 4. Plaintiffs cause of action contains allegations of breaches of Broker-Sales Associate Independent Contractor Agreements between Plaintiff and Defendants, Shatzer and Schellhase (which causes of action were arbitrated in binding arbitration), allegations of tortuous interference with existing contractual relations against all Defendants, allegations of tortuous interference with prospective contractual relations, and allegations of fraud and civil conspiracy against all Defendants. 5. All of the parties to this action are licensed real estate agents 2 and/or licensed real estate brokers and are members of the National Association of Realtors® and, as such, have pledged to conduct their business in accordance with the tenets codified in the Code of Ethics and Standards of Practice of the National Association of Realtors® (hereinafter "Standards of Practice"). 6. On April 29, 2004, this Court granted the Defendants' preliminary objection to compel arbitration on the dispute and stayed the case the resolution of an arbitration proceeding, which was binding as provided in the Standards of Practice. 7. The arbitration occurred on June 7, 2005. 8. Plaintiff is again attempting to have the dispute heard in this Court. 9. In seeking to come back to court, the Plaintiff represented to the Court that the breach of contract claims in this action were resolved See Exhibit "A„]t 10. In actuality, this matter has been fully resolved by the binding arbitration, because, as is discussed in Parts II through V of these Preliminary Objections, all of the other alleged claims are either legally insufficient or are barred by the Gist of the Action rule and the principal that the failure to keep a promise contained in a contract is not fraud. II. FAILURE TO STATE A LEGALLY COGNIZABLE CLAIM FOR TORTIOUS INTERENCE WITH CONTRACT 11. Defendants, by this reference, incorporate the prior allegations of 1 This is a copy of the Plaintiffs letter to the Court dated February 21, 2006 (without the exhibits), in which the Plaintiff represented that Counts I and II were resolved in the arbitration. 3 this pleading, as though such allegations were set forth herein at length. 12. Pa. R. C. P. 1028(4) provides: "Preliminary objections may be filed by any party to any pleading and are limited to the following grounds: (4) legal insufficiency of a pleading (demurrer)[.]" 13. In Counts III and IV of the Complaint, the Plaintiff attempts to state causes of action against Defendants, Craig Schellhase ("Schellhase") and Jeffrey L. Shatzer ("Shatter"), for interference with contracts between Plaintiff and Schellhase and Plaintiff and Schatzer, and against all Defendants for interference with prospective contractual relations between the Plaintiff and potential customers of the Plaintiff. 14. There is no cause of action for tortuous interference where the Plaintiffs business relationships with third parties are adversely affected as a consequence of a Defendant's breach of contractual obligations to the Plaintiff. See Glazer v. Chandler, 414 Pa. 304, 200 A.2d 416, 418 (1964). Accordingly, the Plaintiff cannot recover upon a claim that its business relationships with customers was adversely affected by failure of Schellhase and Schatzer to honor their obligation to refer customers to the Plaintiff. 15. Further, one party to a contract cannot sue the other party for tortuous interference with the contract between them. See Daniel Adams Assoc., Inc. v. Rimbach Publishing, Inc., 360 Pa.Super. 72, 78-79, 519 A.2d 997 (1987). 16. The obligations of Schellhase and Schatzer to the Plaintiff arose 4 under a contract. III. FAILURE TO STATE A LEGALLY COGNIZABLE CLAIM FOR FRAUD 17. Defendants, by this reference, incorporate the prior allegations of this pleading, as though such allegations were set forth herein at length. 18. The Plaintiffs contention that it can recover in tort on the basis that agents of the Plaintiff referred customers to Defendant Re/Max Realty Agency is inconsistent with the "Gist of the Action" doctrine, which disallows tort claims where the gravamen of the action arises out of the contractual relationship. See Phico Insurance Co. v. Presbyterian Medical Services Corp., 444 Pa. Super. 221, 228, 663 A.2d 753, 757 (1995); Bash v. Bell Telephone Co., 411 Pa. Super. 347, 601 A.2d 825 (1992) (superseded on other grounds as stated in Keefer v. Keefer, 741 A.2d 808 (Pa.Super. 1999)). 19. The contracts described in the Complaint clearly are not collateral to the instant cause of action. 20. The introduction of fraud theories into actions between contracting parties has the effect and goal of interjecting claims for punitive damages in breach of contract cases in an improper attempt to punish the allegedly breaching party instead of seeking to recover the compensatory damages for which the law provides in breach of contract cases. The law of Pennsylvania clearly provides that punitive damages are not recoverable in actions based upon breach of contract. See Johnson v. Hyundai Motor America, 698 A.2d 631, 639 (Pa.Super. 1997) (citing Thorsen v. Iron and Glass Bank, 328 Pa.Super. 135, 5 143, 476 A.2d 928, 932 (1984)). 21. Further, the allegation that a promise was made to refer customers only to the Plaintiff and that this promise was not kept, does not state a cause of action for fraud. A promise under a contract to do something in the future, which promise is not kept, is not fraud. See Neale v. American Motorists Fire Ins. Co. 185 Pa. Super. 60, 62, 138 A.2d 290, 291 (1958). 22. Because the controversy arises out of a contract, the claim for punitive damages must be stricken, as punitive damages will not be awarded for a breach of contract, even if the breaching party allegedly acted in bad faith. See Bleiberq v. Insurance Company of North America, 50 D. & C. 3d 570, 572 (C. P. Allegheny Co. 1987). IV. FAILURE TO STATE A LEGALLY COGNIZABLE CLAIM FOR TORT DAMAGES FOR BREACH OF CONTRACT 23. Defendants, by this reference, incorporate the prior allegations of this pleading, as though such allegations were set forth herein at length. 24. In Counts III through IX of the Complaint, the Plaintiff attempts to states causes of action for tortuous interference with contract, fraud and civil conspiracy. 25. The duties of Messrs Shatzer and Schellhase to refer customers to the Plaintiff and not to anyone else arose under Paragraph 3 of the written Contract. This paragraph states: 'The sales associate agrees to work diligently and 6 with his or her best efforts to sell, lease, or rent any and all real estate listed with the broker, to solicit additional listings and customers of said broker and otherwise promote the business of serving the public in real estate transactions to the end that each party may derive the greatest benefit possible." 26. The Plaintiffs claim is that they failed to refer customers to the Plaintiff as was agreed and instead referred customers elsewhere. This claim arose under a contract. 27. The claims against Defendants Re/Max Realty Agency, Samuel C. Small and Steven B. Spray, are claims between brokers over the allegedly improper transfer of customers or potential customers from one brokerage to another. As between the two real estate brokerages, Article 17 of the Standards of Practice provides as follows: "In the event of contractual disputes or specific non-contractual disputes as defined in Standard of Practice 17-4 between REALTORSO, the REALTORS@ shall submit the dispute to arbitration in accordance with the regulations of their Board or Boards rather than litigate the matter.... The obligation to participate in arbitration contemplated by this Article includes the obligation of REALTORS@ (principals) to cause their firms to arbitrate and be bound by any award." 'The obligation to participate in arbitration contemplated by this Article includes the obligation of Realtors@ (principals) cause their firms to arbitrate and be bound by any award 28. The duties of Messrs Shatzer and Schellhase to refer customers to the Plaintiff and not to anyone else arose under Paragraph 3 of the written Contract. 7 29. It is because of the contracts that the Plaintiff is entitled to claim the commissions paid by the customers whom the Plaintiff alleged were improperly referred to Re/Max Realty Agency. 30. This controversy arises under contracts and principles of contract law because disputes between brokers and other brokers and between brokers and their agents that arise when agents change their brokers of record are the subject matter of contracts between the agents and the brokers and because real estate agency is a specialized professional calling with its own system for self- governance and handling disputes. 31. A party to a contract may not sue the other party to the contract in tort for damages arising out of a breach of the contract. See Stout v. Peugeot Motors of America, 662 F.Supp. 1016, 1018 (E.D.Pa.,1986), citing Standard Pipeline Coating Co. v. Solomon & Teslovich. Inc., 344 Pa.Super. 367, 496 A.2d 840, 843- 44 (1985); Glazer v. Chandler, 414 Pa. 304, 308 & f.n.1, 200 A.2d 416 (1964); Iron Mountain Security Storage Corp v American Specialty Foods Inc., 457 F.Supp. 1158, 1165-66 (E.D.Pa.1978). 32. For these reasons, the claims for fraud and interference with contract should be dismissed. 33. Further, the Defendants request the Court to strike the claim for punitive damages. IV. FAILURE TO STATE A LEGALLY COGNIZABLE CLAIM FOR FOR CIVIL CONSPIRACY. 34. Defendants, by this reference, incorporate the prior allegations of this pleading, as though such allegations were set forth herein at length. 8 35. In order for a claim of civil conspiracy to proceed, a plaintiff must "allege the existence of all elements necessary to such a cause of action." Lackner v. Glosser, et. al., Rutherfoord v. Presbyterian-University Hospital, 417 Pa. Super. 316, 612 A.2d 500, 508 (1992) See Petula v. Mellody. 138 Pa.Cmwlth. 411, 588 A.2d 103 (1991). 36. In order to state a cause of action for civil conspiracy, a complaint must allege that two or more persons combined or agreed to commit an unlawful act or to do an otherwise lawful act by unlawful means. See Petula v. Mellody, supra, 138 Pa.Cmwlth. at 418, 588 A.2d at 107. "Proof of malice, an intent to injure, is also essential." Id. 37. Prudential's claim for civil conspiracy is based solely on the underlying claims for fraud and interference with contract [See Complaint, ¶¶ 102-104]. 38. The claim for civil conspiracy of necessity can be no stronger than the alleged underlying causes of action, and as outlined in Parts II through IV of these Preliminary Objections. The underlying causes of action are for fraud and interference with contract. Prudential does not state a legally sufficient claim for fraud or intentional interference with contract. 39. A plaintiff cannot recover from two persons for conspiring to do something that would not give rise to a cause of action, if one of the persons did it by himself. 40. An inadequate claim for civil conspiracy may be dismissed upon preliminary objections by the defendant. 9 WHEREFORE, Defendants, by their undersigned counsel, respectfully request this Honorable Court grant their Preliminary Objections and dismiss the Complaint with prejudice. Respectfully submitted, Dated: el' ? Z'L' "" TUPITZA & BRYMAN, P.C. by: James S'Tupitza, Esquire Attorney for Defendants 10 r.. p r r, ,_? , ,. ??, ;- ., __} ,,, c: BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 1U104U-/JUU Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants for Ylamtltt CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-258x- 5_'?9q CERTIFICATE OF SERVICE I, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Plaintiff's Response to Defendants' Preliminary Objections to Plaintiff's Complaint, with proposed Order, and Brief in support thereof, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 C. Date: "' ?0 ?? By: -?. ` _ BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 2003-5294 PLAINTIFF'S RESPONSE TO DEFENDANTS' PRELIMINARY OBJECTIONS TO PLAINTIFF'S COMPLAINT Plaintiff, by its undersigned counsel, does hereby respond to Defendants' Amended Preliminary Objections to Plaintiff's Complaint. Admitted. 2. Admitted. 3. Admitted. 4. Admitted in part; denied in part. It is admitted that Plaintiff's Complaint contains multiple causes of action, including breaches of Broker-Sales Associate Independent Contractor Agreements, tortuous interference with existing contractual relations, tortious interference with prospective advantage /contractual relations, fraud and civil conspiracy. By way of further response, Plaintiff's complaint is a document which speaks for itself and any contrary interpretation is therefore denied. 5. Admitted in part; denied in part. The averment is admitted as to Plaintiff, however, Plaintiff is without knowledge as to the truth of the averment as it pertains to Defendant and the same is therefore denied. 6. Admitted. Admitted 8. Denied. This entire case was stayed pending arbitration. Plaintiff is not "again attempting to have the dispute heard in this Court", as stated by Defendants in their Amended Preliminary Objections. To the contrary, Plaintiff is seeking to proceed on the claims which were specifically not heard in arbitration. By letter dated January 7, 2005, Alvin C. Monshower, Jr., Esquire, counsel for the Pen-Mar Regional Association of RealtorsO, Inc. sent correspondence to counsel for Plaintiff and Defendants advising that "the arbitration will be limited solely to the contractual obligations existing between the agents and their former and current broker arising directly out of the written Independent Contractor Agreement then in effect with Prudential. (A copy of said correspondence is attached to Plaintiff s Brief in Opposition to Defendants' Preliminary Objections as Exhibit "A" and is incorporated herein by reference). Indeed, said correspondence confirmed that the arbitration was limited to the Independent Contractor Agreements between Plaintiff and Defendants Schellhase and Shatzer. There were no other agreements involved in the arbitration and in fact, said correspondence specifically stated that Defendants Samuel C. Small and Steven Spray were not even parties to the arbitration hearing. Therefore, the disputes that Plaintiff is proceeding on have never been heard. 9. Admitted in part; denied in part. It is admitted that Plaintiff's counsel's correspondence to the Court dated February 21, 2006 stated that "the Association agreed to only resolve the Breach of Contract claims" and that "[s]ince the Association only agreed to hear the Breach of Contract claims (Counts I and II), the remaining claims contained in Plaintiff's complaint (Counts III-IX for Tortious Interference, and Fraud) are unresolved." The correspondence speaks for itself and any contrary interpretation is therefore denied. 10. Denied as a conclusion of law to which no response is required. By way of further response, Defendants' own admission in this paragraph that there are other claims contradicts its averment that the matter has been fully resolved at arbitration. TORTIOUS INTERFERENCE WITH CONTRACT 11. The above paragraphs are incorporated herein by reference. 12. Admitted. 13. Denied. The Complaint speaks for itself and any contrary interpretation is therefore denied. By way of further response, Count III as to Defendants Schellhase and Shatzer is withdrawn. By way of further response, Count III also contains a claim for Tortious Interference with Existing Contractual Relations against Defendants Small, Spray, Re/Max, Schellhase and Shatzer. By way of further response count IV is a claim for Tortious Interference with Prospective Advantage/Contractual Relations with third parties against Defendants Small, Spray, Re/Max, Schellhase and Shatzer. 14. Denied as a conclusion of law to which no response is required. 15. Denied as a conclusion of law to which no response is required. 16. It is admitted that some of the obligations of Schellhase and Shatzer to the Plaintiff were created by contract; it is denied that all of the obligations of Schellhase and Shatzer to the Plaintiff were created by contract. FRAUD 17. The above paragraphs are incorporated herein by reference. 18. Denied as a conclusion of law to which no response is required. By way of further response, Defendants are ignoring Plaintiff's claims that Defendants Small, Spray and Re/Max (who had no contractual relationship with Plaintiff) tortiously interfered with Plaintiff's contractual relations with Defendants Schellhase and Shatzer and with Plaintiff's current and prospective contractual relations with consumers. 19. Denied as a conclusion of law to which no response is required. As more fully discussed in Plaintiff's accompanying Brief, the defendants conspired and cooperated with each other to intentionally and illegally take business and consumers away from Plaintiffs. The breach of contract by Schellhase and Shatzer was collateral thereto. By way of further response, the breach of contract claims against Schellhase and Shatzer are unrelated to the actions of Small, Spray and Re/Max. 20. Denied as a conclusion of law to which no response is required. 21. Denied as a conclusion of law to which no response is required. 22. Denied as a conclusion of law to which no response is required. By way of further response, the "controversy" between Plaintiff and Defendants Small, Spray and Re/Max did not arise out of a contract and therefore the Gist of the Action Doctrine cannot apply. Moreover, Plaintiff did not demand punitive damages under any breach of contract claim, but rather demanded punitive damages under the claims for tortious interference with existing and 4 prospective contracts and fraud, which is permissible. SHV Coal. Inc. v. Continental Grain Co., 526 Pa. 489, 493, 587 A.2d 702, 704 (1991). PLAINTIFF HAS SUFFICIENTLY PLED ITS TORT CLAIMS 23. The above paragraphs are incorporated herein by reference. 24. Denied. The Complaint is a document which speaks for itself and any contrary interpretation is therefore denied. 25. Denied as a conclusion of law to which no response is required. By way of further response, the agreement is a document which speaks for itself and any contrary interpretation is therefore denied. 26. Denied. The Complaint is a document which speaks for itself and any contrary interpretation is therefore denied. By way of further response, Defendants single out only one of Plaintiff's claims in its Complaint. Again, Defendants ignore Plaintiff's claims that Defendants Small, Spray and Re/Max tortiously interfered with Plaintiff's contractual relations with Defendants Schellhase and Shatzer and with Plaintiff's current and prospective contractual relations with consumers. 27. Denied. The Complaint is a document which speaks for itself and any contrary interpretation is therefore denied. By way of further response, Plaintiff's complaint is not about an "improper transfer of customers or potential customers from one brokerage to another". To the contrary, Plaintiff's complaint, inter alia, alleges that Defendants Small, Spray and Re/Max tortiously interfered with Plaintiff's contractual relations with Defendants Schellhase and Shatzer and with Plaintiff's current and prospective contractual relations with consumers. Byway of further response, as stated by counsel for Pen-Mar Regional Association of Realtors®, Inc., Plaintiffs tort claims "are beyond the scope of the obligation of the Pen-Mar Association of Realtors® to arbitrate" and Plaintiff is free to return to Court to litigate such matters. See: Exhibit "A" hereto. 28. Denied as a conclusion of law to which no response is required. By way of further response, the agreement is a document which speaks for itself and any contrary interpretation is therefore denied. 29. Denied as a conclusion of law to which no response is required. By way of further response, the agreement is a document which speaks for itself and any contrary interpretation is therefore denied. 30. Denied. Plaintiff's objection that this "controversy" arises under contract and principles of contract because the disputes are the subject matter of contracts is denied as being a circular argument. Plaintiff's objection that this "controversy" arises under contract and principles of contract because real estate agency is a specialized professional calling with its own system for self governance and handling disputes, is, unsupportable. 31. Denied as a conclusion of law to which no response is required. 32. Denied as a conclusion of law to which no response is required. 33. Denied as a conclusion of law to which no response is required. CIVIL CONSPIRACY 34. The above paragraphs are incorporated herein by reference. 35. Denied as a conclusion of law to which no response is required. 36. Denied as a conclusion of law to which no response is required. 37. Denied. The Complaint is a document which speaks for itself and any contrary interpretation is therefore denied. 38. Denied as a conclusion of law to which no response is required. 39. Denied as a conclusion of law to which no response is required. 40. Denied as a conclusion of law to which no response is required. WHEREFORE, Plaintiff respectfully requests that this Honorable Court deny Defendants' Preliminary Objections and Order Defendants to Answer Plaintiffs Complaint. H. Gjt (jE2 ? S' OCIATES, P.C. Date: q Zc ? David J. Attorney, a -_? '? SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a THE PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF V. CRAIG SCHELLHASE, JEFFREY L. SHATZER, SAMUEL C. SMALL, STEVEN B. SPRAY, AND RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 03-5294 CIVIL TERM IN RE: AMENDED PRELIMINARY OBJECTIONS OF DEFENDANTS TO PLAINTIFF'S COMPLAINT ORDER OF COURT AND NOW, this :Zd day of May, 2006, IT IS ORDERED that the amended preliminary objections of defendants to plaintiffs complaint, which allege failure to state legally cognizable claims, are: (1) GRANTED as to Count III, tortuous interference with existing contractual relations against defendants Schellhase and Shatzer, and DENIED as to defendants Small, Spray and Re/Max. Count III as to defendants Schellhase and Shatzer, IS DISMISSED. (2) GRANTED as to Count IV, tortuous interference with prospective advantage/contractual relations against defendants Schellhase and Shatzer, and DENIED as to defendants Small, Spray and Re/Max. Count IV as to defendants Schellhase and Shatzer, IS DISMISSED. (3) DENIED as to Count V, tortuous interference with existing contractual relations against defendants Small, Spray and Re/Max. 03-5294 CIVIL TERM (4) DENIED as to Count VI, tortuous interference with prospective advantage/contractual relations against defendants Small, Spray and Re/Max. (5) GRANTED as to Count VI, fraud against defendant Schellhase. Count VI, IS DISMISSED. (6) GRANTED as to Count VII, fraud against defendant Shatzer. Count VII, IS DISMISSED. (7) GRANTED as to Count VIII, fraud against defendant Small, Spray and Re/Max. Count VIII, IS DISMISSED. (8) GRANTED as to Count IX, civil conspiracy against all defendants. Count IX, IS DISMISSED.' (9) The incorporated motion to strike the claim for punitive damages in Counts III, IV, V, and VI, ARE DENIED. By Edgar B. ?-avid J. Scaggs, Esquire For Plaintiff Vdames S. Tupitza, Esquire For Defendants :sal og.o ' Count I, breach of contract against defendant Schellhase and Count II, breach of contract against defendant Shatzer, ARE MOOT as those claims are subject to arbitration. -2- >- t.1) - -? t7- v .-, ti TUPITZA & BRYMAN, P.C. By: James S. Tupitza, Esquire ID No. 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS TO THE PLAINTIFF: Attorney for Defendants IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-5294 You are hereby notified to plead to the attached New Matter against you within 20 days of service hereof or a default judgment may be entered against you. Respectfully submitted, Jam pi a, Esquire Att ndants TUPITZA & BRYMAN, P.C. By: James S. Tupitza, Esquire ID No. 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-5294 DEFENDANTS' ANSWER AND NEW MATTER TO PLAINTIFF'S COMPLAINT Admitted. 2. Admitted. 3. Admitted. By way of further answer, Craig Schellhase is no longer a Defendant in this action as a result of the May 3, 2006 Order of this Honorable Court effectively dismissing all counts as to Craig Schellhase. 4. Admitted. By way of further answer, Jeffrey L. Shatzer is no longer a Defendant in this action as a result of the May 3, 2006 Order of this Honorable Court effectively dismissing all counts as to Jeffrey L. Shatzer. 5. Admitted. 6. Admitted. 7. Admitted. 8. Denied as a conclusion of law to which no responsive pleading is necessary. 9. Admitted. 10. Admitted. 11. Denied as a conclusion of law. The Associate Agreements speak for themselves. 12. Denied as a conclusion of law. Exhibit "C" speaks for itself. 13. Denied as a conclusion of law. Exhibit "D" speaks for itself. 14. Admitted. 15. Denied that Schellhase and Shatzer were actively working with or for Re/Max while under their Associate Contracts with Plaintiff. Further, neither Schellhase nor Shatzer are Defendants in this action as any counts against them were dismissed per this Court's Order dated May 3, 2006. 16. Denied. Exhibit "E" speaks for itself. This claim was referred to binding arbitration under this Court's Order dated April 29, 2004 and this claim was specifically addressed at that arbitration hearing. By way of further answer, it should be noted that the Synopsis Report is dated after Schellhase had already resigned from Plaintiff and began working with Defendant, Re/Max. Further, Schellhase is no longer a defendant in this action as any counts against him were dismissed per this Court's Order dated May 3, 2006 17. Denied as a conclusion of law. Exhibit "E" speaks for itself. See answer to paragraph 16, which is incorporated by reference. 18. Denied as a conclusion of law. Exhibit "F" speaks for itself. By way of further answer, see answers to paragraphs 15 and 16, which are incorporated by reference. 19. Denied. See answers to paragraphs 15 and 16, which are incorporated by reference. 20. Denied. This claim was referred to arbitration under this Court's Order dated April 29, 2004 and this claim was specifically addressed at the arbitration hearing. By way of further answer, it should be noted that the Synopsis Report is dated after Schellhase had already resigned from Plaintiff and began working with Defendant, Re/Max. Further, Schellhase is not a Defendant in this action any longer as any counts against him were dismissed per this Court's Order dated May 3, 2006. 21. Denied. See answers to paragraphs 15 and 20, which are incorporated by reference. 22. Denied. This claim was referred to arbitration under this Court's Order dated April 29, 2004and this claim was specifically addressed at the arbitration hearing. By way of further answer, it should be noted that the Synopsis Report is dated after Schellhase had already resigned from Plaintiff and began working with Defendant, Re/Max. Further, Schellhase is not a Defendant in this action any longer as any counts against him were dismissed per this Court's Order dated May 3, 2006. 23. Denied. See answer to paragraph 22, which is incorporated by reference. 24. Denied. See answers to paragraphs 16-18 and 22, which are incorporated by reference. Further, this averment is a conclusion of law as Exhibits "E" and "F" speak for themselves. 25. Denied. This claim was referred to arbitration under this Court's Order dated April 29, 2004 and this claim was specifically addressed at the arbitration hearing. By way of further answer, it should be noted that the Synopsis Report is dated after Shatzer had already resigned from Plaintiff and began working with Defendant, Re/Max. Further, Shatzer is not a Defendant in this action any longer as any counts against him were dismissed per this Court's Order dated May 3, 2006. Exhibit "I" speaks for itself. 26. Denied as a conclusion of law as Exhibit "I" speaks for itself. By way of further answer, see answer to paragraph 25, which is incorporated by reference. 27. Denied. See answers to paragraphs 15 and 25, which are incorporated by reference. 28. Denied as a conclusion of law as Exhibit "I" speaks for itself. By way of further answer, see answer to paragraph 25, which is incorporated by reference. 29. Denied. The claim that there are other properties listed by Shatzer and Schellhase through Re/Max which should have been listed with Plaintiff is moot under this Court's Order dated May 3, 2006, which dismissed the breach of contract claims against Schellhase and Shatzer as moot. Neither Schellhase nor Shatzer are Defendants in this action any longer as any counts against them were dismissed per this same Order. Further, any specific claim regarding any other specific properties not covered in the previous arbitration would need to be addressed not before this Court but, rather, in binding arbitration per this Court's Order dated April 29, 2004. 30. Denied. The claim that Schellhase and Shatzer referred potential customers of Plaintiff to Defendant Re/Max is moot under this Court's Order dated May 3, 2006, which dismissed the breach of contract claims against Schellhase and Shatzer as moot. Neither Schellhase nor Shatzer are Defendants in this action any longer as any counts against them were dismissed per this same Order. Further, any specific claim regarding any other specific potential customers not covered in the previous arbitration would need to be addressed not before this Court but, rather, in binding arbitration per this Court's Order dated April 29, 2004. 31. Denied. See answers to paragraphs 15, 29 and 30, which are incorporated by reference. Denied that Defendant Small and, thereby Defendant Re/Max, acted improperly in any fashion, which caused any detriment to Plaintiff. 32. Denied. See answers to paragraphs 15, 29 and 30, which are incorporated by reference. Denied that Defendant Spray and, thereby Defendant Re/Max, acted improperly in any fashion, which caused any detriment to Plaintiff. 33. Denied that Defendants Small and Spray, on behalf of themselves and on behalf of Defendant Re/Max caused, persuaded and induced Schellhase and Shatzer, while under contract with Plaintiff, to list properties with Defendant Re/Max instead of with Plaintiff. See answers to paragraphs 15, 29 and 30, which are incorporated by reference. 34. Denied that Defendants Small and Spray, on behalf of themselves and on behalf of Defendant Re/Max caused, persuaded and induced other persons who had Broker-Sales Associate Independent Contractor Agreements with Plaintiff to perform the same alleged wrongful activities as Schellhase and Shatzer and further concealed such actions. See answer to paragraph 33, which is incorporated by reference. 35. Denied as a conclusion of law to which no response is required and, further, since no transactions are identified, Defendants are without knowledge or information sufficient to form a belief as to the truth of this averment. 36. Denied as a conclusion of law to which no response is required and, further, since no transactions are identified, Defendants are without knowledge or information sufficient to form a belief as to the truth of this averment. COUNT I - BREACH OF CONTRACT Plaintiff vs. Schellhase 37-40. This claim is moot as specified in footnote 1 on page 2 of this Court's Order dated May 3, 2006. COUNT II - BREACH OF CONTRACT Plaintiff vs. Shatzer 41-44. This claim is moot as specified in footnote 1 on page 2 of this Court's Order dated May 3, 2006. COUNT III - TORTIOUS INTERFERENCE WITH EXISTING CONTRACTUAL RELATIONS Plaintiff vs. Defendants Small. Spray. Re/Max. Schellhase and Shatzer 45. Defendants' answers to paragraphs 1 through 44 are incorporated by reference as though more fully set forth herein. 46. Denied as stated. The Agreements entered into between Schellhase and Shatzer with Plaintiff are attached and marked Exhibits "A" and "B" to Plaintiffs Complaint and they speak for themselves. 47. Denied that Defendants, Small, Spray and Re/Max, did anything to intentionally harm Plaintiff. By way of further response, Count III has been dismissed with respect to Schellhase and Shatzer. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that the averment vaguely refers to "... the aforementioned actions" of Defendants. The Defendants incorporate their New Matter as if set forth at length. 48. Denied. See answer to paragraph 47, which is incorporated by reference. 49. Denied as a conclusion of law to which no responsive pleading is necessary. By way of further response, see answer to paragraph 47, which is incorporated by reference. WHEREFORE, Defendants Small, Spray and Re/Max respectfully request judgment in their favor and against Plaintiff plus the costs of this action. COUNT IV - TORTIOUS INTERFERENCE WITH PROSPECTIVE ADVANTAGEICONTRACTUAL RELATIONSHIP Plaintiff vs. Defendants Small. Spray, Re/Max. Schellhase and Shatzer 50. Defendants' responses to paragraphs 1 through 49 are incorporated herein by reference as though more fully set forth. 51. Denied that Defendants, Small, Spray and Re/Max, engaged in any tortious actions that prevented prospective customers of Plaintiff from engaging Plaintiff as a broker in their real estate transactions and that said prospective customers would have engaged Plaintiff as their Broker had Defendants not engaged in certain tortious actions and activities, which are not identified by Plaintiff with any specificity. By way of further response, Count IV has been dismissed with respect to Schellhase and Shatzer. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that the averment vaguely refers to "actions", "... the activities as described herein" of Defendants and does not identify the "prospective customers" in this allegation. The Defendants incorporate their New Matter as if set forth at length. 52. Denied as a conclusion of law to which no responsive pleading is required. By way of further answer, see Defendants' responses to paragraphs 15 through 28, which are incorporated by reference, in reference to the specific properties identified by Plaintiff. Further, the specific properties identified in Plaintiffs allegations were all involved in transactions that were arbitrated in binding arbitration. 53. Denied that Defendants, Small, Spray and Re/Max, engaged in any tortious actions that caused any prospective customers of Plaintiff to engage Re/Max as their real estate broker instead of Plaintiff. By way of further response, Count IV has been dismissed with respect to Schellhase and Shatrer. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that the averment vaguely refers to "actions" of Defendants and does not identify the "prospective customers" in this allegation. The Defendants incorporate their New Matter as if set forth at length. 54. Denied that Defendants Small, Spray and Re/Max advised any prospective customer of Plaintiff not to engage Plaintiff but to use Re/Max instead. By way of further response, Count IV has been dismissed with respect to Schellhase and Shatzer. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that it alleges that Schellhase and Shatrer advised prospective customers of Plaintiff not to engage Plaintiff but does not identify the "prospective customers" in this allegation. The Defendants incorporate their New Matter as if set forth at length. 55. Denied that Defendants, Small, Spray and Re/Max, did anything to intentionally harm Plaintiff. By way of further response, Count III has been dismissed with respect to Schellhase and Shatzer. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that the averment vaguely refers to "... the aforementioned actions" of Defendants and does not identify the "potential customers" of Plaintiff. The Defendants incorporate their New Matter as if set forth at length. 56. Denied as a conclusion of law to which no responsive pleading is required. By way of further response, Count IV has been dismissed with respect to Schellhase and Shatzer. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that the averment vaguely refers to "actions" of Defendants and does not identify the alleged "prospective contracts" or "property owners" of Plaintiff. The Defendants incorporate their New Matter as if set forth at length. 57. Denied as a conclusion of law to which no responsive pleading is required. WHEREFORE, Defendants, Small, Spray and Re/Max respectfully demand judgment in their favor and against Plaintiff plus the costs of this action. COUNT V - TORTIOUS INTERFERENCE WITH EXISTING CONTRACTUAL RELATIONS Plaintiff vs. Defendants Small. Spray and Re/Max 58. Defendants' responses to paragraphs 1 through 57 are incorporated herein by reference as though more fully set forth. 59. Denied as a conclusion of law to which no responsive pleading is necessary. 60. Denied that Defendants Small, Spray and Re/Max tortiously caused, persuaded and induced other real estate salespersons, while such other real estate salespersons were under contract with Plaintiff, to list properties with Defendant Re/Max instead of with Plaintiff. Further, Defendants are without knowledge and information sufficient to form a belief as to the truth of this averment since Plaintiff does not identify the "other real estate salespersons" or the "properties" that Plaintiff believes should have been listed with Plaintiff. 61. Denied that Defendants, Small, Spray and Re/Max, did anything to intentionally harm Plaintiff. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that the averment vaguely refers to "... the actions" of Defendants without identifying with any specificity the real estate salespersons, the properties or the actions in this count. The Defendants incorporate their New Matter as if set forth at length. 62. Denied as a conclusion of law to which no responsive pleading is necessary. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that neither this averment nor this pleading provide any specificity as to the "other such estate salespersons." The Defendants incorporate their New Matter as if set forth at length. 63. Denied as a conclusion of law to which no responsive pleading is required. WHEREFORE, Defendants, Small, Spray and Re/Max respectfully demand judgment in their favor and against Plaintiff plus the costs of this action. COUNT VI - TORTIOUS INTERFERENCE WITH PROSPECTIVE ADVANTAGE/CONTRACTUAL RELATIONS Plaintiff vs. Defendants Small, Spray and Re/Max 64. Defendants' responses to paragraphs 1 through 63 are incorporated herein by reference as though more fully set forth. 65. Denied that Defendants Small, Spray and Re/Max tortiously caused, persuaded and induced other real estate salespersons who were under contract with Plaintiff, to list properties with Defendant Re/Max instead of with Plaintiff. Further, Defendants are without knowledge and information sufficient to form a belief as to the truth of this averment since Plaintiff does not identify the "other real estate salespersons" or the "properties" that Plaintiff believes should have been listed with Plaintiff. Defendants incorporate their New Matter as if set forth herein at length. 66. Denied that Defendants Small, Spray and Re/Max cooperated with other real estate salespersons who were under contract with Plaintiff in advising other prospective customers of Plaintiff not to engage Plaintiff as their real estate broker but instead to use Re/Max as their real estate broker. Further, Defendants are without knowledge and information sufficient to form a belief as to the truth of this averment since Plaintiff does not identify the "other real estate salespersons" or the "prospective customers." Defendants incorporate their New Matter as if set forth herein at length. 67. Denied that Defendants Small, Spray and Re/Max ever engaged in any tortious actions that caused any prospective customers of Plaintiff to engage Re/Max as their real estate broker instead of Plaintiff. Further, Defendants are without knowledge and information sufficient to form a belief as to the truth of this averment since Plaintiff does not identify with any specificity the "actions" of Defendants, or even the "numerous prospective customers" Plaintiff believes would have engaged the services of Plaintiff but for the "actions" of Defendants, Small, Spray and Re/Max. Defendants incorporate their New Matter as if set forth herein at length. 68. Denied that Defendants, Small, Spray and Re/Max ever prevented prospective customers of Plaintiff from engaging Plaintiff as broker in their real estate transactions and that said prospective customers would have engaged Plaintiff but for the alleged tortious activities of Defendants Small, Spray and Re/Max. Further, Defendants are without knowledge and information sufficient to form a belief as to the truth of this averment since Plaintiff does not identify with any specificity how Defendants tortiously prevented prospective customers of Plaintiff from engaging Plaintiff, the tortious "activities" of Defendants, or even the "prospective customers" Plaintiff believes would have engaged the services of Plaintiff. Defendants incorporate their New Matter as if set forth herein at length. 69. Denied that Defendants, Small, Spray and Re/Max, did anything to intentionally harm Plaintiff. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that the averment does not identify with specificity the tortious "actions" of Defendants or the "potential customers." The Defendants incorporate their New Matter as if set forth at length. 70. Denied as a conclusion of law to which no responsive pleading is necessary. Further, Defendants lack knowledge or information sufficient to form a belief as to the truth of this averment in that neither this averment nor this pleading provide any specificity as to the tortious "actions" of Defendants, the "property owners" or "prospective contracts." The Defendants incorporate their New Matter as if set forth at length. 71. Denied as a conclusion of law to which no responsive pleading is required. WHEREFORE, Defendants, Small, Spray and Re/Max respectfully demand judgment in their favor and against Plaintiff plus the costs of this action. COUNT VI - FRAUD Plaintiff vs. Schellhase 72-79. This claim is dismissed per this Court's Order dated May 3, 2006. COUNT VII - FRAUD Plaintiff vs. Shatzer 80-87. This claim is dismissed per this Court's Order dated May 3, 2006, COUNT VIII - FRAUD Plaintiff vs. Defendants Small. Spray and Re/Max 88-99. This claim is dismissed per this Court's Order dated May 3, 2006. COUNT IX - CIVIL CONSPIRACY Plaintiff vs. All Defendants 100-107. This claim is dismissed per this Court's Order dated May 3, 2006. NEW MATTER 108. The Plaintiffs claims are barred by privilege. 109. The Plaintiffs claims are barred by justification. 110. All of the Plaintiffs claims that are based on the specific identified properties in the Complaint are barred by arbitration and award. 111. The Plaintiffs claims are non-existent because the Defendants Small, Spray and Re/Max engaged in no wrongful conduct. 112. No relief can be granted to Plaintiff for interference with employment contracts because any contracts with which the Defendants allegedly interfered were at will contracts. 113. The Plaintiffs claims are barred in that the Defendants have a privilege to act in their own legitimate business interests in seeking employees and customers. 114. The Plaintiffs claims are barred in that the Defendants, as competitors of Plaintiffs, have a privilege to compete and to offer employment to at will employees or independent contractors of the Defendants. 115. The Plaintiffs claims are barred in that the Defendants, as competitors of Plaintiff, have a privilege to compete with the Plaintiff for customers and employees 116. The Plaintiffs claims are non-existent in that the Plaintiff did not earn a commission by procuring a purchaser who offered to buy on the terms stipulated by any vendor. 117. The Plaintiff's claims are non-existent in that the Defendants did not procure the breach of any contract between the Plaintiff and any seller of real estate or employee of the Plaintiff. 118. The Plaintiffs claims are barred in that the Defendants did not commit any wrongful act that retarded, made more difficult, or prevented the performance of any contract between the Plaintiff and any seller of real estate or employee of the Plaintiff. 119. Plaintiffs claims are barred by the statute of frauds. Respectfully submitted, VERIFICATION The undersigned hereby verifies that the fads alleged In the foregoing Answer and New Matter are true and correct to the best of his knowledge and belief. He undersigned understands that false statements hereunder are subject to the penalties far unswom falsification of 18 PA.C.S. 4904. Date: Oro „ Samuel C. Small Z 'd ZM 'ON NPO:: 9001 'El'InP VERIFICATION The undersigned hereby verifies that the facts alleged In the foregoing Answer and New Matter are true and correct to the best of his knoWledge and belief. He undersigned understands that false statements hereunder are subject to the penalties for unswom falsification of 18 PAC. S. 4904. Date: 7 -I 3awG Steve \1 d 6 'd ZM 'ON W G:0 9001 'N 'Inf TUPITZA & BRYMAN, P.C. By: James S. Tupitza, Esquire ID No. 22761 212 W. Gay Street West Chester, PA 19380 610-696-2600 Attorney for Defendants SHANK AND ASSOCIATES REAL ESTATE, INC. d/b/a PRUDENTIAL FRANKLIN ASSOCIATES, PLAINTIFF VS. CRAIG SCHELLHASE, individually and as agent for Re/Max Realty Agency, Inc. and JEFFREY L. SHATZER, individually and as agent for Re/Max Realty Agency, Inc. and SAMUEL C. SMALL, individually and as agent/broker for Re/Max Realty Agency, Inc. and STEVEN B. SPRAY, individually and as agent/broker for Re/Max Realty Agency, Inc. and RE/MAX REALTY AGENCY, INC., DEFENDANTS IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNA. CIVIL ACTION - LAW NO. 03-5294 CERTIFICATE OF SERVICE I hereby certify I am this date serving a copy of the Defendants' Answer and New Matter to Plaintiffs Complaint, upon the following person by First Class Mail addressed as follows: Blair H. Granger, Esquire David J. Scaggs, Esquire 1800 E. Lancaster Avenue Paoli, PA 19301 Attorney for Plaintiff Date: :?4 of submitted, Esquire BLAIR IL GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 640-7500 Shank and Associates Real Estate, Inc. The Prudential Franklin Associates 946 Lincoln Way East Chambersburg, PA 17201 Plaintiff v Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., RelMax Realty Agency, Inc. CUMBERLAND COUNTY, PE COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 2003-5294 PLAINTIFF'S REPLY TO DEFENDANTS' NEW MATTER 108. Denied as a conclusion of law to which no response is required. 109. Denied as a conclusion of law to which no response is required. 110. Denied as a conclusion of law to which no response is required. By way of further response, the only claims arbitrated were the breach of contract claims. As evidenced by this Court's denial of Defendants' Preliminary Objections, Plaintiff s claims for Tortious Interference are not barred by said arbitration. 111. Denied as a conclusion of law to which no response is required. By way of further response, Plaintiff's claims do exist because of the wrongs committed by the Defendants as set forth in the complaint. 112. Denied as a conclusion of law to which no response is required. 113. Denied as a conclusion of law to which no response is required. By way of fiuther response, it is not a legitimate business interest to wrongfully interfere with a competitor's existing and prospective contracts. 114. Denied as a conclusion of law to which no response is required. By way of further response, Defendants do not have a privilege to wrongfully interfere with a competitor's existing and prospective contracts. 115. Denied as a conclusion of law to which no response is required. By way of further response, Defendants do not have a privilege to wrongfully interfere with a competitor's existing and prospective contracts. 116. Denied as a conclusion of law to which no response is required. Byway of further response, it is denied that Plaintiff's claims are "non-existent" or that the defense offered is relevant, even if true. 117. Denied as a conclusion of law to which no response is required. By way of further response, Defendants committed the actions as set forth in the complaint. 118. Denied. To the contrary, Defendants committed the actions as set forth in the complaint. 119. Denied as a conclusion of law to which no response is required. & ASSOCIATES, P.C. Date: By: David gs, Esquire Attorney for Plaintiffs Verification I, J. Arnold Shank, being authorized to make this verification on behalf of Shank and Associates real Estate, Inc. d/b/a The Prudential Franklin Associates, verify I have read the foregoing Reply to New Matter, and state that the facts contained therein are true and correct to the best of my knowledge, information and belief and make these statements subject to the penalties of 18 Pa. C.S. 4904 relating to unswom falsification to authorities. Shank & Associates Real Estate, Inc. Dated: a4,2oo6 By: j./( Amold Shank, President r r" _. ? -ii rn `_ t BLAIR H GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 640-7500 Shank and Associates Real Estate, Inc. Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Ior CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-258T 5ag4 CERTIFICATE OF SERVICE I, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Plaintiff's Reply to Defendants' New Matter, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 C. Date: Cs By: '` ? ?, BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 644)- /S W Estate, Inc. d/b/a The Plaintiff Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW 03 -5A,?4 DOCKET NO..-t5--259T CERTIFICATE OF SERVICE I, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Plaintiffs Interrogatories Directed to Defendant Re/Max Realty Agency, Inc. - Set One; Plaintiff's Request for Production of Documents Directed to Defendant Re/Max Realty Agency Inc. - Set One; Plaintiff s Interrogatories Directed to Defendant Samuel C. Small - Set One; and Plaintiffs Request for Production of Documents Directed to Defendant Samuel C. Small - Set One, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 .C. Date: ?5 ?f 06 By: d - o co o a BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 6101640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants CERTIFICATE OF SERVICE I, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Plaintiff's Interrogatories Directed to Defendant Steven B. Spray - Set One; Plaintiff's Request for Production of Documents Directed to Defendant Steven B. Spray - Set One; and Plaintiff's Expert Interrogatories Directed to all Defendants - Set One, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 Date: l!? - 01 for rlamtttt CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW D3-5ag4 DOCKET NO. B By: ASSOCIATES, P.C. uire C? N r ?1 '. -1 _iry - ? ?, - it:{? p ?.J C"; -- -- -r Y. :'tea , t -- t? l?? -t BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 for Plaintiff Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-5294 PLAINTIFF'S MOTION TO COMPEL DISCOVERY RESPONSES Plaintiff, through its undersigned counsel, hereby moves this Honorable Court to compel Defendants Samuel C. Small, Steven B. Spray and Re/Max Realty Agency, Inc., to comply with Plaintiff's written discovery requests. In support of the motion, Plaintiff avers the following: On August 3, 2006, Plaintiff forwarded the following written discovery to counsel for the Defendants: a) Plaintiff s Interrogatories Directed to Defendant Re/Max Realty Agency, Inc. - Set One; b) Plaintiff's Request for Production of Documents Directed to Defendant Re/Max Realty Agency Inc. - Set One; c) Plaintiff's Interrogatories Directed to Defendant Samuel C. Small - Set One; d) Plaintiff's Request for Production of Documents Directed to Defendant Samuel C. Small - Set One A copy of the aforementioned discovery requests are attached hereto as Exhibit "A" 2. On Sept 18, 2006, counsel for the defendants sent an email to plaintiff's counsel requesting an extension to respond to the discovery requests until September 27, 2006. By reply email of September 18, 2006, the undersigned agreed to the extension. See: Exhibit "B". 3. On September 27, 2006, counsel for the defendants sent an email to plaintiff's counsel requesting another extension to respond to the discovery until "the end of next week", or November 3, 2006. By reply email of September 27, 2006, the undersigned agreed to the extension. See: Exhibit "C". 4. On October 9, 2006, counsel for the defendants sent another email to plaintiff's counsel requesting another extension to respond to the discovery until "the end of this week", or October 13, 2006. By reply email of October 10, 2006, the undersigned agreed to the extension and asked that a reasonable deadline be provided in which the defendants would respond. See: Exhibit "D". 5. On October 12, 2006, counsel for the defendants sent an email to plaintiff's counsel requesting that the extension be extended until October 25, 2006. By reply email of October 12, 2006, the undersigned agreed to the extension. See: Exhibit "E". 6. On November 3, 2006, counsel for Plaintiff sent an email to counsel for defendants advising that it was discovered that discovery requests directed to Defendant Spray and expert interrogatories were not forwarded to defendants' counsel (although discovery requests to Defendants Re/Max and Small had been sent as indicated above). As such, Plaintiffs counsel advised that such discovery would be forwarded and that the filing of a motion to compel would be delayed until after the time that the additional discovery requests were due expired. See: Exhibit "F". 7. On November 3, 2006, the following written discovery requests were sent to counsel for the defendants: a) Plaintiff's Interrogatories Directed to Defendant Steven B. Spray - Set One; b) Plaintiff's Request for Production of Documents Directed to Defendant Steven B. Spray - Set One; c) Plaintiff's Expert Interrogatories Directed to All Plaintiffs- Set One. A copy of the aforementioned discovery requests are attached hereto as Exhibit "G" 8. To date, the defendants have not responded to Plaintiffs written discovery requests. 9. More than thirty (30) days has elapsed since the discovery requests were sent to counsel for defendants. 10. Counsel for Plaintiff has provided numerous extensions for the defendants to respond to the discovery requests. 11. The requested discovery is essential to the Plaintiff's prosecution of this matter. 12. Delay in obtaining answers to Plaintiff's written discovery has and will continue to prejudice the Plaintiff. WHEREFORE, Plaintiff respectfully requests this Honorable Court to enter an Order compelling Defendants Samuel C. Small, Steven B. Spray and Re/Max Realty Agency, Inc. provide full and complete answers, without objection, to Plaintiff's written Interrogatories, Expert Interrogatories and Request for the Production of Documents, within twenty (20) days of service of said Order. Dated: --d 0 0 ?xtirb;f f? BLAIR H. GRANGER & ASSOCIATES, P.C. ATTORNEYS AT LAW BLAIR H. GRANGER DAVID J. SCAGGS JASON S. PORTNOY August 3, 2006 James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 1800 EAST LANCASTER AVENUE PAOLI, PENNSYLVANIA 19301 (610) 640-7500 FACSIMILE (610) 640-7505 Re: Shank and Associates Real Estate Inc. v. Craig Schellhase, et al. Cumberland County Docket No. 03-5294 Dear Jim: Enclosed please find the following discovery requests in the above-captioned matter: 1. Plaintiff s Interrogatories Directed to Defendant Re/Max Realty Agency, Inc. - Set One; 2. Plaintiff s Request for Production of Documents Directed to Defendant Re/Max Realty Agency Inc. - Set One; 3. Plaintiffs Interrogatories Directed to Defendant Samuel C. Small- Set One; 4. and Plaintiffs Request for Production of Documents Directed to Defendant Samuel C. Small - Set One Please respond to the same in accordance with the Pennsylvania Rules of Civil Procedure. ;IA.TES, P.C. DJS/szm Enclosures cc: Arnold Shank BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Attorneys for Plaintiff Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-5294 PLAINTIFF'S INTERROGATORIES DIRECTED TO DEFENDANT RE/MAX REALTY AGENCY, INC. - SET ONE Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, request that the Defendant Re/Max Realty Agency, Inc.answer the following interrogatories within thirty (30) days from the date of service to the best of its knowledge, information and belief in accordance with and subject to the penalties of 18 Pa. C.S. §4904 relating to unsworn falsifications. In providing responses please attach additional pages where necessary. Defmitions "Identify" when referring to a person means to state the name, home and business address, title, and telephone number. "Identify" when referring to a document means to state the title, date, author, recipient and current custodian of any written material. "Identify" when referring to a location requires providing an unambiguous and clear description based on geography, landmarks, monuments, distances, etc. that would enable a reasonable person to determine the location or place identified. "Writings" means all correspondence, memoranda, notes, transcripts, documents and drafts thereof which have been reduced to written form. "Person(s)" refers to any separate legal entity whether natural or otherwise including without limitation partnership, corporation, and individual. "Document(s)" or "Documentation" as used herein shall include without limitation the original and any nonidentical copy of any written, printed, recorded, charted, digitized, taped, graphic or magnetic matter (including, but not limited to, video tapes, audio tapes, and computer tapes and discs), however produced, reproduced or prepared, including without limitation any correspondence, voicemail, email, memoranda, notes, minutes of meetings, records, statements, reports, writings, telegrams, transcripts of telephone conversations or any other writings or documentary material of any nature whatsoever, whether reduced to paper or stated on any computer system, computer disk, computer tape, computer chip or transistor, or stored in any electronic medium together with any attachments thereto and enclosures therewith, and any other photographic and retrievable matter in the possession, custody or control of You and/or Your attorney. "Document(s)" also means any drafts of the foregoing. "Records" is defined as documentation, whether written or electrically maintained, of events, happenings, transactions, contacts, incidents, or actions. "You", "Your" or "Yours" refers to the Defendant Re/Max Realty Agency, Inc., or anything possessed by it. 2 "Conversations" means any oral statements made from one individual directed to another individual whether in person or by telephone including without limitation any voicemails or phone messages left for another individual. "Statements" is defined as any comments, remarks, representations, announcements, notes, correspondence, memoranda whether oral or written. "Litigation" means the above captioned matter. Instructions A. If any of these Interrogatories cannot be answered in full, answer to the extent possible, specifying the reasons for Your inability to answer the remainder and stating whatever information, knowledge or belief You do have concerning the unanswered portion. B. If any document is withheld or not identified under a claim of privilege, immunity or otherwise, identify each such document and state the date of the document, its author and addresses, each person to whom copies of the document were furnished or to whom the contents thereof were communicated, a summary of the subject matter of the document, the basis upon which the asserted privilege, immunity or other reason for non-disclosure is claimed and the Interrogatories to which the document is responsive. C. If any Interrogatory is objected to by You as inquiring into privileged matters, set forth fully in Your objections the facts upon which You rely as the basis for Your objection. D. When used in the course of an enumeration of items as to which documents or information are requested, the words "of' and "and" are to be construed as requesting documents or information as to each item in the enumeration, the same as if the entire request had been addressed solely to that item. E. These Interrogatories are continuing in nature. If, after answering these Interrogatories, You obtain or become aware of any further information responsive to these 3 Interrogatories, You are required to serve a supplemental answer reflecting all such subsequently acquired information. F. In responding to these Interrogatories, identify all documents or other sources of information which relate to the information requested by the Interrogatory. In lieu of stating the contents of particular documents when requested, you may attach copies of those documents to your Response to the Interrogatories. Interrogatories Identify the corporate designee of the Defendant Re/Max Realty Agency, Inc. for this Litigation. 2. Identify the name of the person answering these Interrogatories. 3. Identify the name of the person providing the answers to Plaintiffs Requests for Production of Documents directed to Re/Max Realty Agency, Inc. 4. Please identify all officers and directors of Defendant Re/Max Realty Agency, Inc. for the last five (5) years. 4 5. Please identify all management and/or supervisory personnel of Defendant Re/Max Realty Agency, Inc. for the last five (5) years. 6. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between any officer, director, employee, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc., and any employee, independent contractor, licensee and/or agent of Plaintiff regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 7. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between any officer, director, employee, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc., and any employee, independent contractor, licensee and/or agent of Plaintiff regarding the possibility of the foregoing individual(s) working for or becoming associated with Defendant Re/Max Realty Agency, Inc. 8. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between any officer, director, employee, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc., and any non-party to this Litigation regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 5 9. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between any officer, director, employee, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc., and any other party to this Litigation regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 10. Have You or anyone acting on Your behalf obtained from any person any Statement (as defined by the Rules of Civil Procedure) concerning this Litigation or its subject matter? If so, identify: (a) Each such person; (b) When, where, by whom and to whom each Statement was made, and whether it was reduced to writing or otherwise recorded; (c) Any person who has custody of any such Statements that were reduced to writing or otherwise recorded. 11. Have You or anyone acting on Your behalf given any Statement (as defined by the Rules of Civil Procedure) concerning this Litigation or its subject matter? If so, identify: (a) Each person to whom a Statement was given; 6 (b) When and where each Statement was given; (c) Any person who has custody of any such statements that were reduced to writing or otherwise recorded. 12. Please identify all individuals who provided You with any writings and/or documents regarding this Litigation or its subject matter. For any individuals noted, identify the specific writings and/or documents given and attach a copy of those writings and/or documents to Your responses. 13. Please identify all individuals with whom any officer, director, employee, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc., has discussed this Litigation or its subject matter. 14. Please identify all persons having any knowledge of the facts in this Litigation. Provide the source of that knowledge and a copy of any documents sent to and/or received from the person having such knowledge. 7 15. Please identify all witnesses You expect to call at trial and provide the substance about which each witness will testify. 16. Please identify all professional licenses that You maintain or have maintained, including any associated license number. Please identify the effective dates for said licenses. 17. For each such license that you have identified in response to the previous interrogatory, have You ever been the subject of any disciplinary action? If your answer is in the affirmative, identify the party bringing the discipline, the license and license number involved, any identifying number associated with the disciplinary action, the date the disciplinary action commenced, the parties involved in the disciplinary action and the disposition. 18. Have you ever been the subject of an ethics complaint in any Realtor® association? If so, please identify the caption of the complaint, the related association, when the complaint was made and the subject matter of the complaint. 19. Have You even been a party to a lawsuit other than the current litigation? If so, please identify the case name, docket number and the court in which it was maintained. 8 20. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between any officer, director, employee, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc. and any of the following individuals relating to their becoming employed or associated with Defendant Re/Max Realty Agency, Inc.: a) Diane Ebersole b) Brenda Bodner c) James Heckman d) Donna Peachy e) Jeff Jessell 0 Jeff Shatzer g) Craig Schellhase h) Robert Starr i) Lester Swope j) Nancy Shoop 21. For those individuals referenced in the previous interrogatory: a) Identify the date on which each of the said individuals began working for or became associated with Defendant Re/Max Realty Agency, Inc.; b) Identify each and every consumer that each of the said individuals represented during each of their respective first years working for Defendant Re/Max Realty Agency, Inc. For each such consumer, identify the property/properties listed for sale by said consumer and/or the property/properties that each consumer was pursuing; c) Identify the person responsible for the supervision of the said individuals during their association with Defendant Re/Max Realty Agency, Inc. d) Provide the current home address and telephone number for each of the said individuals. 9 22. Please identify any individual(s) not otherwise listed in interrogatory 20 that worked for Plaintiff directly prior to working for or becoming associated with Defendant Re/Max Realty Agency, Inc. 23. For each individual you identify in response to the previous interrogatory, please provide the information requested in interrogatories 20 and 21. 24. During the time period of sixty (60) days prior to the respective date that each of the individuals referenced in interrogatory 20, and each of the individuals that you identified in response to interrogatory 22, began working for Re/Max Realty Agency, Inc., to a period of sixty (60) days after said individuals begin working for Re/Max Realty Agency, Inc., respectively, please identify any and all new consumers that You and/or said individuals represented. (In each instance where one of the said individuals represented the consumer, please associate said individual with the consumer). & ASSOCIATES Date: ?S (3"??' David J Plaintiff 10 BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (01 U) 04U- / UU Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and DOCKET NO.: 03-5294 Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants PLAINTIFFS' REQUEST FOR PRODUCTION OF DOCUMENTS DIRECTED TO DEFENDANT RE/MAX REALTY AGENCY, INC. - SET ONE You are hereby requested pursuant to Rule 4009, Pennsylvania Rules of Civil Procedure, to make available to Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates (hereinafter "Plaintiffs") by and through their undersigned attorney, the below listed documents and/or items for purposes of discovery. This material will be examined and/or photocopied, photograph negatives will be processed, and/or photographs reproduced. Said documents, photographs, diagrams, and/or tangible things are to be produced at the law offices of Blair H. Granger & Associates, P.C., 1800 East Lancaster Avenue, Paoli, PA 19301, within thirty (30) days from the date of service hereof and supplemented thereafter in accordance with the rules of the Court. The documents and writings to be inspected and photographed will be duly safeguarded and returned to You with reasonable dispatch on completion of the duplication process, and without harm to the originals. The definitions and instructions set forth in Plaintiffs' First Set of Interrogatories to You are included herein by reference. 1. Please provide all phone records including bills, invoices, writings, documents, written transcripts of conversations, voicemails, computerized records, and audio tapes of conversations which detail, summarize or express any content of conversations or statements which any employee, officer, director, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc. received or made with any person or entity , concerning the Litigation or its subject matter. 2. For all conversations, voicemails, etc. referenced in Request No. 1 above, where such phone records are not available as to provide the nature, date, substance and participants of the conversations, voicemails, etc., please provide the same in response to this request. 3. Please provide a copy of all statements made by witnesses, either written or electronically recorded, regarding the happening of any events alleged in any of the pleadings in this matter. 4. Please provide a copy of all statements that have been taken in connection with this litigation, including written statements, transcriptions or recorded interviews and summaries of oral statements. 2 5. Please provide a copy of all writings, documents, or correspondence, notes, and memoranda, in Your possession or which You have access to, between the parties and/or any representative of a party relating to the Litigation or its subject matter. 6. Please provide a copy of all exhibits that You intend to introduce at trial of this matter. 7. Please provide a written list of any and all individuals who have been contacted by You as potential witnesses at trial (or otherwise) of this matter, including: name, address, and phone number. Please provide copies of any documents in which those witnesses are referenced. 8. Please provide a copy of any and all documents referring to or relating to the allegations set forth in Your Answer and New Matter, or any other pleadings in this matter. 9. Please provide a copy of any and all documents referring to or relating to Your answers to Plaintiffs' Interrogatories - Set One. 10. Please provide a copy of Your employment/personnel file for each of the following individuals (in responding to this request you may redact any confidential information such as social security numbers, tax identification numbers and bank account numbers): a) Diane Ebersole b) Brenda Bodner c) James Heckman d) Donna Peachy 3 e) Jeff Jessell f J Jeff Shatzer g) Craig Schellhase h) Robert Starr i) Lester Swope j) Nancy Shoop 11. For the individuals referenced in the above request, please provide the following documents (in responding to this request you may redact any confidential information such as social security numbers, tax identification numbers and bank account numbers): a) The transaction files for any and all consumers that said individuals represented during their respective first year working for Defendant Re/Max Realty Agency, Inc., including but not limited to, listing agreements, buyer broker agreements, agreements of sale, consumer notices, cooperating broker agreements, conveyancing documents, disclosure statements, checks, settlement statements, advertising materials, etc.; b) Copies of any and all bank records of Defendant Re/Max Realty Agency, Inc. for any transaction that said individuals were involved in for the fast year said individuals were working for Defendant Re/Max Realty Agency, Inc., including but not limited those relating to commissions received by Defendant Re/Max Realty Agency, Inc. and/or any of the said individuals. 12. For any individual(s) not otherwise listed in request 10 who worked for Plaintiff directly prior to working for Defendant Re/Max Realty Agency, Inc., please provide the documents requested in request 11. 13. Please provide a copy of the transaction files for any new consumers, represented by You and/or any of the individuals referenced in request 10 and/or any of individuals that you identified in response to interrogatory 21, during the time period of sixty (60) days prior to the respective date that each of the aforesaid individuals began working for Re/Max Realty Agency, Inc., to a period of sixty (60) days after said individuals begin working for Re/Max Realty 4 Agency, Inc., respectively (in responding to this request you may redact any confidential information such as social security numbers, tax identification numbers and bank account numbers). 14. Please provide a copy of any and all training materials and policy manuals for Defendant Re/Max Realty Agency, Inc. that discuss recruitment of employees, licensees, salespersons and/or agents. 15. Please provide a copy of any and all training materials and policy manuals for Defendant Re/Max International that discuss recruitment of employees, licensees, salespersons and/or agents. S Date: U - 0 5 BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 61U) 64U-75UU for Plaintiff Shank and Associates Real Estate, Inc. d/b/a The CUMBERLAND COUNTY, Prudential Franklin Associates PENNSYLVANIA Plaintiff COURT OF COMMON PLEAS V. CIVIL ACTION - LAW Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and DOCKET NO.: 03-5294 Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. PLAINTIFF'S INTERROGATORIES DIRECTED TO DEFENDANT SAMUEL C. SMALL - SET ONE Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, request that the Defendant Samuel C. Small answer the following interrogatories within thirty (30) days from the date of service to the best of its knowledge, information and belief in accordance with and subject to the penalties of 18 Pa. C.S. §4904 relating to unsworn falsifications. In providing responses please attach additional pages where necessary. Defmitions "Identify" when referring to a person means to state the name, home and business address, title, and telephone number. "Identify" when referring to a document means to state the title, date, author, recipient and current custodian of any written material. "Identify" when referring to a location requires providing an unambiguous and clear description based on geography, landmarks, monuments, distances, etc. that would enable a reasonable person to determine the location or place identified. "Writings" means all correspondence, memoranda, notes, transcripts, documents and drafts thereof which have been reduced to written form. "Person(s)" refers to any separate legal entity whether natural or otherwise including without limitation partnership, corporation, and individual. "Document(s)" or "Documentation" as used herein shall include without limitation the original and any nonidentical copy of any written, printed, recorded, charted, digitized, taped, graphic or magnetic matter (including, but not limited to, video tapes, audio tapes, and computer tapes and discs), however produced, reproduced or prepared, including without limitation any correspondence, voicemail, email, memoranda, notes, minutes of meetings, records, statements, reports, writings, telegrams, transcripts of telephone conversations or any other writings or documentary material of any nature whatsoever, whether reduced to paper or stated on any computer system, computer disk, computer tape, computer chip or transistor, or stored in any electronic medium together with any attachments thereto and enclosures therewith, and any other photographic and retrievable matter in the possession, custody or control of You and/or Your attorney. "Document(s)" also means any drafts of the foregoing. "Records" is defined as documentation, whether written or electronically maintained, of events, happenings, transactions, contacts, incidents, or actions. "You", "Your" or "Yours" refers to the Defendant Samuel C. Small or anything possessed by him. 2 "Conversations" means any oral statements made from one individual directed to another individual whether in person or by telephone including without limitation any voicemails or phone messages left for another individual. "Statements" is defined as any comments, remarks, representations, announcements, notes, correspondence, memoranda whether oral or written. "Litigation" means the above captioned matter. Instructions A. If any of these Interrogatories cannot be answered in full, answer to the extent possible, specifying the reasons for Your inability to answer the remainder and stating whatever information, knowledge or belief You do have concerning the unanswered portion. B. If any document is withheld or not identified under a claim of privilege, immunity or otherwise, identify each such document and state the date of the document, its author and addresses, each person to whom copies of the document were furnished or to whom the contents thereof were communicated, a summary of the subject matter of the document, the basis upon which the asserted privilege, immunity or other reason for non-disclosure is claimed and the Interrogatories to which the document is responsive. C. If any Interrogatory is objected to by You as inquiring into privileged matters, set forth fully in Your objections the facts upon which You rely as the basis for Your objection. D. When used in the course of an enumeration of items as to which documents or information are requested, the words "of' and "and" are to be construed as requesting documents or information as to each item in the enumeration, the same as if the entire request had been addressed solely to that item. E. These Interrogatories are continuing in nature. If, after answering these Interrogatories, You obtain or become aware of any further information responsive to these 3 Interrogatories, You're required to serve a supplemental answer reflecting all such subsequently acquired information. F. In responding to these Interrogatories, identify all documents or other sources of information which relate to the information requested by the Interrogatory. In lieu of stating the contents of particular documents when requested, you may attach copies of those documents to your Response to the Interrogatories. Interrogatories 1. State the following a. Your name; b. Any other names that you are known by; c. Date and place of birth; d. Residence address(es) for the five (5) years prior to this lawsuit being filed e. Business address(es) during the same period; and f. Occupation g. Name of Employer 2. Have you ever been convicted of a crime involving theft or dishonesty or other crimes other than for summary violations of a motor vehicle law? If so, set forth the nature of the conviction including the date and location where convicted. 4 3. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any employee, independent contractor, licensee and/or agent of Plaintiff regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 4. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any employee, independent contractor, licensee and/or agent of Plaintiff regarding the possibility of any of the forgoing individual(s) working or becoming associated with Defendant Re/Max Realty Agency, Inc. 5. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any non-party to this Litigation regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 6. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any other party to this Litigation regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 5 7. Have You or anyone acting on Your behalf obtained from any person any Statement (as defined by the Rules of Civil Procedure) concerning this Litigation or its subject matter? If so, identify: (a) Each such person; (b) When, where, by whom and to whom each Statement was made, and whether it was reduced to writing or otherwise recorded; (c) Any person who has custody of any such Statements that were reduced to writing or otherwise recorded. 8. Have You or anyone acting on Your behalf given any Statement (as defined by the Rules of Civil Procedure) concerning this Litigation or its subject matter? If so, identify: (a) Each person to whom a Statement was given; (b) When and where each Statement was given; (c) Any person who has custody of any such Statements that were reduced to writing or otherwise recorded. 6 9. Please identify all individuals who provided You with any writings and/or documents regarding this Litigation or its subject matter. For any individuals noted, identify the specific writings and/or documents given and attach a copy of those writings and/or documents to Your responses. 10. Please identify all individuals with whom You have discussed this Litigation or its subject matter. 11. Please identify all persons having any knowledge of the facts in this Litigation. Provide the source of that knowledge and a copy of any documents sent to and/or received from the person having such knowledge. 12. Please identify all witnesses You expect to call at trial and provide the substance about which each witness will testify. 13. Please identify all professional licenses that you maintain or have maintained, including any associated license number. Please identify the effective dates for said licenses. 7 14. For each such license that you have identified in response to the previous interrogatory, have you ever been the subject of any disciplinary action? If your answer is in the affirmative, identify the party bringing the discipline, the license and license number involved, any identifying number associated with the disciplinary action, the date the disciplinary action commenced, the parties involved in the disciplinary action and the disposition. 15. Have you ever been the subject of an ethics complaint in any Realtor@ association? If so, please identify the caption of the complaint, the related association, when the complaint was made and the subject matter of the complaint. 16. Have you even been a party to a lawsuit other than the current litigation? If so, please identify the case name, docket number and the court in which it was maintained. 17. Please identify any and all business entities in which you maintain an ownership interest and are in any way involved in the management of said business. 18. For each entity you identify in response to the previous interrogatory, please identify your position with said entity and your job responsibilities. 19. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any of the following individuals relating to their becoming employed or associated with Defendant Re/Max Realty Agency, Inc.: a. Diane Ebersole b. Brenda Bodner c. James Heckman d. Donna Peachy e. Jeff Jessell f. Jeff Shatzer g. Craig Schellhase h. Robert Starr i. Lester Swope j. Nancy Shoop 20. Please identify any individual(s) not otherwise listed in interrogatory 19 that worked for Plaintiff directly prior to working for or becoming associated with Defendant Re/Max Realty Agency, Inc. 21. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any officer, director, employee, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc. concerning any of the individuals listed in interrogatory 19 and/or those individuals identified in your response to the previous interrogatory regarding the possibility of any of the said individual(s) working or becoming associated with Defendant Re/Max Realty Agency, Inc. 9 22. Have You ever met with any of the individuals referenced in interrogatory 19 and/or those individuals identified in your response to interrogatory 20 while they were still associated with Plaintiff? If Your answer is in affirmative, please identify when said meeting occurred, where it occurred, who attended and the purpose of said meeting. ASSOCIATES Date: Plaintiff 10 BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants for riamutt CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-5294 PLAINTIFFS' REQUEST FOR PRODUCTION OF DOCUMENTS DIRECTED TO DEFENDANT SAMUEL C. SMALL - SET ONE You are hereby requested pursuant to Rule 4009, Pennsylvania Rules of Civil Procedure, to make available to Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates (hereinafter "Plaintiffs") by and through their undersigned attorney, the below listed documents and/or items for purposes of discovery. This material will be examined and/or photocopied, photograph negatives will be processed, and/or photographs reproduced. Said documents, photographs, diagrams, and/or tangible things are to be produced at the law offices of Blair H. Granger & Associates, P.C., 1800 East Lancaster Avenue, Paoli, PA 19301, within thirty (30) days from the date of service hereof and supplemented thereafter in accordance with the rules of the Court. The documents and writings to be inspected and photographed will be duly safeguarded and returned to You with reasonable dispatch on completion of the duplication process, and without harm to the originals. The definitions and instructions set forth in Plaintiffs' First Set of Interrogatories to You are included herein by reference. 1. Please provide all phone records, including but not limited to, bills, invoices, writings, documents, written transcripts of conversations, voicemails, computerized records, and audio tapes of conversations which detail, summarize or express any content of conversations or statements which You received or made with any person or entity, concerning the Litigation or its subject matter. 2. For all conversations, voicemails, etc. referenced in Request No. 1 above, where such phone records are not available as to provide the nature, date, substance and participants of the conversations, voicemails, etc., please provide the same in response to this request. 3. Please provide a copy of all statements made by witnesses, either written or electronically recorded, regarding the happening of any events alleged in any of the pleadings in this matter. 4. Please provide a copy of all statements that have been taken in connection with this litigation, including written statements, transcriptions or recorded interviews and summaries of oral statements. 5. Please provide a copy of all writings, documents, or correspondence, notes, and memoranda, in Your possession or which You have access to, between the parties and/or any representative of a party relating to the Litigation or its subject matter. 2 6. Please provide a copy of all exhibits that You intend to introduce at trial of this matter. 7. Please provide a written list of any and all individuals who have been contacted by You as potential witnesses at trial of this matter, including: name, address, and phone number. Please provide copies of any documents in which those witnesses are referenced. 8. Please provide a copy of any and all documents referring to or relating to the allegations set forth in Your Answer and New Matter, or any other pleadings in this matter. 9. Please provide a copy of any and all documents referred to or relating to Your answers to Plaintiffs' Interrogatories - Set One. TES Date: ~ 3 ?? David J. E Attorneys 3 BLAIR H. GRANGER & ASSOCIATES, P. C. ATTORNEYS AT LAW BLAIR H. GRANGER DAVID J. SCAGGS JASON S. PORTNOY August 3, 2006 Prothonotary's Office Cumberland County Courthouse One Courthouse Square Carlisle, PA 17013 1800 EAST LANCASTER AVENUE PAOLI, PENNSYLVANIA 19301 (610) 640-7500 FACSIMILE (610) 640-7505 Re: Shank and Associates Real Estate. Inc. v. Craig Schellhase, et al. Civil Action Docket No. 03-5294 Dear Madam or Sir: Enclosed please find an original and one copy of a Certificate of Service in the above- captioned matter. Please file the original and return a time-stamped copy to me in the enclosed, addressed, postage-paid envelope. Thank you for your assistance with this matter. DJS/szm Enclosures cc: James T. Tupitza, Esquire (w/enclosure) SOCIATES, P.C. BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 610) 64U-750U Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-258T CERTIFICATE OF SERVICE 1, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Plaintiff's Interrogatories Directed to Defendant Re/Max Realty Agency, Inc. - Set One; Plaintiff's Request for Production of Documents Directed to Defendant Re/Max Realty Agency Inc. - Set One; Plaintiff's Interrogatories Directed to Defendant Samuel C. Small - Set One; and Plaintiff's Request for Production of Documents Directed to Defendant Samuel C. Small - Set One, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 C. Date: ?? By: 0 Page 1 of 2 David J. Scaggs, Esquire From: "David J. Scaggs, Esquire" <david.scaggs@bhgranger.com> To: "Debbie Woodall" <Debbie.Woodall@tupitzalaw.com> Sent: Monday, September 18, 2006 5:14 PM Subject: Re: Shank & Assoc. vs. Re/Max Realty, et al Sure. David J. Scaggs, Esquire BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 East Lancaster Avenue Paoli, PA 19301 610-640-7500 610-640-7505(Fax) david. scagg sCa,bharanger. com The information contained in this transmission contains information from the law firm of Blair H. Granger & Associates, P.C. which is confidential and/or legally privileged. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited and that the transmission should be returned to this firm immediately. In this regard, if you have received this transmission in error, please notify us by telephone immediately (610-640-7500) and delete any copies of this transmission. Thank you. ----- Original Message ---- From: Debbie Woodall To: david.scaggs(cDbhgranger.com Sent: Monday, September 18, 2006 6:10 PM Subject: Shank & Assoc. vs. Re/Max Realty, et al David, Unfortunately, I haven't completed the discovery responses in our clients' case to have Jim review so we can provide it to you. I had hoped to come in to finish it this weekend but was unable to do so due to a family health issue. My schedule this week is such that we will not be able to get it out to you until early next week. Can we have an additional extension until next Tuesday, September 27th? Sincerely, Deborah A. Woodall Paralegal Tupitza & Bryman, P.C. 212 West Gay Street West Chester, Pa 19380 (610) 696-2600 Fax (610) 344-7199 Internet E-mail: debbie woodallpa.tupitzalaw.com 1/12/2007 Page 2 of 2 The forgoing electronic transmission, including but not limited to, any attachments, contains information that is confidential and subject to the attorney-client privilege. This transmission, in its entirety, is non-public information and is intended to be conveyed to the designated addressee only. If you are not the intended recipient and have received this transmission in error, please notify the sender immediately by calling 610-696-2600 (collect) or replying to this message. Unauthorized distribution of the information contained in this transmission and any attachments is strictly prohibited. 1/12/2007 • b,1 C" Page 1 of 2 David J. Scaggs, Esquire From: "David J. Scaggs, Esquire" <david.scaggs@bhgranger.com> To: "Debbie Woodall" <Debbie.Woodall@tupitzalaw.com> Sent: Wednesday, September 27, 2006 4:54 PM Subject: Re: Shank & Assoc. vs. Re/Max Realty, Inc., et al That's fine. Where's the trial at? David J. Scaggs, Esquire BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 East Lancaster Avenue Paoli, PA 19301 610-640-7500 610-640-7505 (Fax) david.scaggs@-bhua-nger.com The information contained in this transmission contains information from the law firm of Blair H. Granger & Associates, P.C. which is confidential and/or legally privileged. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited and that the transmission should be returned to this firm immediately. In this regard, if you have received this transmission in error, please notify us by telephone immediately (610-640-7500) and delete any copies of this transmission. Thank you. ---- Original Message ---- From: Debbie Woodall To: david.scaggsCa).bhg_ranger.com Sent: Wednesday, September 27, 2006 5:35 PM Subject: Shank & Assoc. vs. Re/Max Realty, inc., et al David, Unfortunately, we are not able to provide the discovery responses until next week. Jim is handling a jury trial this week and the clients have to review the typed responses and sign Verifications still. Due to the trial prep necessary in the case we are trying now, we were unable to complete the responses in time to get them to you this week. We will have them to you by the end of next week at the latest although we are hoping to get them to you sooner. Please accept our apologies for the delay. Sincerely, Deborah A. Woodall Paralegal Tupitza & Bryman, P.C. 212 West Gay Street West Chester, Pa 19380 1/12/2007 Page 2 of 2 (610) 696-2600 Fax (610) 344-7199 Internet E-mail: debbie.woodall@t-upitzalaw.com The forgoing electronic transmission, including but not limited to, any attachments, contains information that is confidential and subject to the attorney-client privilege. This transmission, in its entirety, is non-public information and is intended to be conveyed to the designated addressee only. If you are not the intended recipient and have received this transmission in error, please notify the sender immediately by calling 610-696-2600 (collect) or replying to this message. Unauthorized distribution of the information contained in this transmission and any attachments is strictly prohibited. 1/12/2007 • ? ?xG?idi+ P Page 1 of 2 David J. Scaaas. Esauire From: "David J. Scaggs, Esquire" <david.scaggs@bhgranger.com> To: "Debbie Woodall" <Debbie.Woodall@tupitzalaw.com> Sent: Tuesday, October 10, 2006 7:58 AM Subject: Re: Shank and Assoc. vs. Re/Max Realty, et al Debbie, You can have another extension, but I need you to give me a reasonable deadline by which you can respond. Beyond that, my client wants me to file a motion. David J. Scaggs, Esquire BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 East Lancaster Avenue Paoli, PA 19301 610-640-7500 610-640-7505 (Fax) david.scaggsO.bhgranegr.com The information contained in this transmission contains information from the law firm of Blair H. Granger & Associates, P.C. which is confidential and/or legally privileged. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited and that the transmission should be returned to this firm immediately. In this regard, if you have received this transmission in error, please notify us by telephone immediately (610-640-7500) and delete any copies of this transmission. Thank you. ---- Original Message ----- From: Debbie Woodall To: david.scaggsCa)-bhgranger.com Sent: Monday, October 09, 2006 10:12 AM Subject: Shank and Assoc. vs. Re/Max Realty, et al David, Unfortunately, Jim's schedule has been so hectic that he has been unable to review the Responses to discovery and the documents to send to you. He is now out of the state at a title seminar until sometime on Wednesday. I apologize for the delay in getting the Responses to you and it is not due to any delay by our clients but really due to the work load in our office. It is my hope that Jim will be able to review this upon his return so we can get it out to you by the end of this week. Again, I apologize. Sincerely, Deborah A. Woodall Paralegal Tupitza & Bryman, P.C. 1/12/2007 Page 2 of 2 212 West Gay Street West Chester, Pa 19380 (610) 696-2600 Fax (610) 344-7199 Internet E-mail: debbie.woodall@UWitzalaw.com The forgoing electronic transmission, including but not limited to, any attachments, contains information that is confidential and subject to the attorney-client privilege. This transmission, in its entirety, is non-public information and is intended to be conveyed to the designated addressee only. If you are not the intended recipient and have received this transmission in error, please notify the sender immediately by calling 610-696-2600 (collect) or replying to this message. Unauthorized distribution of the information contained in this transmission and any attachments is strictly prohibited. 1/12/2007 F x?, ?,, i Page 1 of 3 David J. Scaggs, Esquire From: "David J. Scaggs, Esquire" <david.scaggs@bhgranger.com> To: "Debbie Woodall" <Debbie.Woodall@tupitzalaw.com> Sent: Thursday, October 12, 2006 5:51 PM Subject: Re: Shank and Assoc. vs. Re/Max Realty, et al That is fine; October 25, 2006. Please let Jim know that if we don't get them by then my client wants me to file a motion. Thanks. David J. Scaggs, Esquire BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 East Lancaster Avenue Paoli, PA 19301 610-640-7500 610-640-7505(Fax) david.scaggs@bhgranger.com The information contained in this transmission contains information from the law firm of Blair H. Granger & Associates, P.C. which is confidential and/or legally privileged. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited and that the transmission should be returned to this firm immediately. In this regard, if you have received this transmission in error, please notify us by telephone immediately (610-640-7500) and delete any copies of this transmission. Thank you. --- Original Message ---- From: Debbie Woodall To: david.scaggs@bhgranger.com Sent: Thursday, October 12, 2006 5:03 PM Subject: Re: Shank and Assoc. vs. Re/Max Realty, et al Dave, I talked to Jim who told me he has two briefs that he has to write and get filed before he can review the Responses so they can be forwarded to you. One is due tomorrow and the other, involving numerous transcripts, is due the week after next. To be safe, we would ask for a further extension until October 25th. Please advise if that is acceptable. Again, we apologize for our delay. Sincerely, Deborah A. Woodall Paralegal Tupitza & Bryman, P.C. 212 West Gay Street 1/12/2007 Page 2 of 3 West Chester, Pa 19380 (610) 696-2600 Fax (610) 344-7199 Internet E-mail: debbie.woodall@ioitzalaw.com The forgoing electronic transmission, including but not limited to, any attachments, contains information that is confidential and subject to the attorney-client privilege. This transmission, in its entirety, is non-public information and is intended to be conveyed to the designated addressee only. If you are not the intended recipient and have received this transmission in error, please notify the sender immediately by calling 610-696-2600 (collect) or replying to this message. Unauthorized distribution of the information contained in this transmission and any attachments is strictly prohibited. >>> "David J. Scaggs, Esquire" <david.scaggsbbh graneg r.com> 10/10/2006 8:58:15 AM >>> Debbie, You can have another extension, but I need you to give me a reasonable deadline by which you can respond. Beyond that, my client wants me to file a motion. David J. Scaggs, Esquire BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 East Lancaster Avenue Paoli, PA 19301 610-640-7500 610-640-7505 (Fax) david.scaggsna bharan eg r.com The information contained in this transmission contains information from the law firm of Blair H. Granger & Associates, P.C. which is confidential and/or legally privileged. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited and that the transmission should be returned to this firm immediately. In this regard, if you have received this transmission in error, please notify us by telephone immediately (610-640-7500) and delete any copies of this transmission. Thank you. ----- Original Message ----- From: Debbie Woodall To: david.scaggs@bhgranger.com Sent: Monday, October 09, 2006 10:12 AM Subject: Shank and Assoc. vs. Re/Max Realty, et al David, 1/12/2007 Page 3 of 3 Unfortunately, Jim's schedule has been so hectic that he has been unable to review the Responses to discovery and the documents to send to you. He is now out of the state at a title seminar until sometime on Wednesday. I apologize for the delay in getting the Responses to you and it is not due to any delay by our clients but really due to the work load in our office. It is my hope that Jim will be able to review this upon his return so we can get it out to you by the end of this week. Again, I apologize. Sincerely, Deborah A. Woodall Paralegal Tupitza & Bryman, P.C. 212 West Gay Street West Chester, Pa 19380 (610) 696-2600 Fax (610) 344-7199 Internet E-mail: debbie.woodallnao.tupitzalaw.com The forgoing electronic transmission, including but not limited to, any attachments, contains information that is confidential and subject to the attorney-client privilege. This transmission, in its entirety, is non-public information and is intended to be conveyed to the designated addressee only. If you are not the intended recipient and have received this transmission in error, please notify the sender immediately by calling 610-696-2600 (collect) or replying to this message. Unauthorized distribution of the information contained in this transmission and any attachments is strictly prohibited. 1/12/2007 • • EX ?,??+ r Page 1 of 5 David J. Scagg , Esquire From: "Debbie Woodall" <Debbie.Woodall@tupitzalaw.com> To: <david.scaggs@bhgranger.com> Sent: Friday, November 03, 2006 3:41 PM Subject: Re: Shank and Assoc. vs. Re/Max Realty, et al Thanks David, we appreciate that. Deb >>> "David J. Scaggs, Esquire" <david.scaggs@cr?bhgraner.com> 11/3/2006 3:39:21 PM >>> Hi Debbie, In preparing my Motion to Compel I realized that you did not receive discovery requests for Mr. Spray as well as expert interrogatories. I'm not sure how that happened. Anyway, I'm sending those to you know. I'll hold off filing the motion until after those responses are due. Hopefully I will receive all responses by then. Thanks. David J. Scaggs, Esquire BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 East Lancaster Avenue Paoli, PA 19301 610-640-7500 610-640-7505 (Fax) david. scaggs@bhgranger. com The information contained in this transmission contains information from the law firm of Blair H. Granger & Associates, P.C. which is confidential and/or legally privileged. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited and that the transmission should be returned to this firm immediately. In this regard, if you have received this transmission in error, please notify us by telephone immediately (610-640-7500) and delete any copies of this transmission. Thank you. ----- Original Message ----- From: Debbie Woodall To: david.scaggs@bhgranger.com Sent: Friday, October 13, 2006 9:52 AM Subject: Re: Shank and Assoc. vs. Re/Max Realty, et al I will. Thanks David. 1/12/2007 Page 2 of 5 >>> "David J. Scaggs, Esquire" <david.scaggsna bhgranger.com> 10/12/2006 6:51:38 PM >>> That is fine; October 25, 2006. Please let Jim know that if we don't get them by then my client wants me to file a motion. Thanks. David J. Scaggs, Esquire BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 East Lancaster Avenue Paoli, PA 19301 610-640-7500 610-640-7505(Fax) david.scagjzs@.bhjzranger.com The information contained in this transmission contains information from the law firm of Blair H. Granger & Associates, P.C. which is confidential and/or legally privileged. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited and that the transmission should be returned to this firm immediately. In this regard, if you have received this transmission in error, please notify us by telephone immediately (610-640-7500) and delete any copies of this transmission. Thank you. ----- Original Message ----- From: Debbie Woodall To: david.scapgs@-bhgranger.com Sent: Thursday, October 12, 2006 5:03 PM Subject: Re: Shank and Assoc. vs. Re/Max Realty, et al Dave, I talked to Jim who told me he has two briefs that he has to write and get filed before he can review the Responses so they can be forwarded to you. One is due tomorrow and the other, involving numerous 1/12/2007 Page 3 of 5 transcripts, is due the week after next. To be safe, we would ask for a further extension until October 25th. Please advise if that is acceptable. Again, we apologize for our delay. Sincerely, Deborah A. Woodall Paralegal Tupitza & Bryman, P.C. 212 West Gay Street West Chester, Pa 19380 (610) 696-2600 Fax (610) 344-7199 Internet E-mail: debbie.woodall@Lupitzalaw.com The forgoing electronic transmission, including but not limited to, any attachments, contains information that is confidential and subject to the attorney-client privilege. This transmission, in its entirety, is non-public information and is intended to be conveyed to the designated addressee only. If you are not the intended recipient and have received this transmission in error, please notify the sender immediately by calling 610-696-2600 (collect) or replying to this message. Unauthorized distribution of the information contained in this transmission and any attachments is strictly prohibited. >>> "David J. Scaggs, Esquire" <david.scaggs@abh roman eg r.com> 10/10/2006 8:58:15 AM >>> Debbie, You can have another extension, but I need you to give me a reasonable deadline by which you can respond. Beyond that, my client wants me to file a motion. David J. Scaggs, Esquire BLAIR H. GRANGER & ASSOCIATES, P.C. 1800 East Lancaster Avenue 1/12/2007 Page 4 of 5 Paoli, PA 19301 610-640-7500 610-640-7505 (Fax) david-scaggs@bh roman eg r.com The information contained in this transmission contains information from the law firm of Blair H. Granger & Associates, P.C. which is confidential and/or legally privileged. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited and that the transmission should be returned to this firm immediately. In this regard, if you have received this transmission in error, please notify us by telephone immediately (610-640-7500) and delete any copies of this transmission. Thank you. ----- Original Message ----- From: Debbie Woodall To: david.scaggsna bhgranger.com Sent: Monday, October 09, 2006 10:12 AM Subject: Shank and Assoc. vs. Re/Max Realty, et al David, Unfortunately, Jim's schedule has been so hectic that he has been unable to review the Responses to discovery and the documents to send to you. He is now out of the state at a title seminar until sometime on Wednesday. I apologize for the delay in getting the Responses to you and it is not due to any delay by our clients but really due to the work 1/12/2007 Page 5 of 5 load in our office. It is my hope that Jim will be able to review this upon his return so we can get it out to you by the end of this week. Again, I apologize. Sincerely, Deborah A. Woodall Paralegal Tupitza & Bryman, P.C. 212 West Gay Street West Chester, Pa 19380 (610) 696-2600 Fax (610) 344-7199 Internet E-mail: debbie.woodall@Wpitzalaw.com The forgoing electronic transmission, including but not limited to, any attachments, contains information that is confidential and subject to the attorney-client privilege. This transmission, in its entirety, is non-public information and is intended to be conveyed to the designated addressee only. If you are not the intended recipient and have received this transmission in error, please notify the sender immediately by calling 610-696-2600 (collect) or replying to this message. Unauthorized distribution of the information contained in this transmission and any attachments is strictly prohibited. 1/12/2007 BLAIR H. GRANGER & ASSOCIATES, P.C. ATTORNEYS AT LAW BLAIR N. GRANGER DAVID J. SCAGGS JASON S. PORTNOY November 3, 2006 James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 1800 EAST LANCASTER AVENUE PAW, PENNSYLVANIA 19301 (610) 640-7500 FACSIMILE (610) 640-7505 Re: Shank and Associates Real Estate. Inc. v. Craik Schellhase, et al. Cumberland County Docket No. 03-5294 Dear Jim: Enclosed please find the following discovery requests in the above-captioned matter: 1. Plaintiff's Interrogatories Directed to Defendant Steven B. Spray - - Set One; 2. Plaintiff s Request for Production of Documents Directed to Defendant Steven B. Spray - Set One; 3. Plaintiff's Expert Interrogatories Directed to All Plaintiffs - Set One. Please respond to the same in accordance with the Pennsylvania Rules of Civil Procedure. ' ASSOCIATES, P.C. DJS/szm Enclosures cc: Arnold Shank BLAIR H. GRANGER & ASSOCIATES., P. C. ATTORNEYS AT LAW BLAIR H. GRANGER DAVID J. SCAGGS JASON S. PORTNOY November 3, 2006 Prothonotary's Office Cumberland County Courthouse One Courthouse Square Carlisle, PA 17013 1800 EAST LANCASTER AVENUE PAOLI, PENNSYLVANIA 19301 (610) 640-7500 FACSIMILE (610) 640-7505 Re: Shank and Associates Real Estate, Inc. v. Craig; Schellhase et al Civil Action Docket No. 03-5294 Dear Madam or Sir: Enclosed please find an original and one copy of a Certificate of Service in the above- captioned matter. Please file the original and return a time-stamped copy to me in the enclosed, addressed, postage-paid envelope. Thank you for your assistance with this matter. ASSOCIATES, P.C. DJS/szm Enclosures cc: James T. Tupitza, Esquire (w/enclosure) BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 61U 64U-75UU Attorneys for Plaintiff Shank and Associates Real Estate, Inc. d/b/a The CUMBERLAND COUNTY, Prudential Franklin Associates PENNSYLVANIA Plaintiff COURT OF COMMON PLEAS V. Craig Schellhase, individually and as agent for CIVIL ACTION - LAW Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for I DOCKET NO.: 03-258T Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants CERTIFICATE OF SERVICE I, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Plaintiff s Interrogatories Directed to Defendant Steven B. Spray - Set One; Plaintiff's Request for Production of Documents Directed to Defendant Steven B. Spray - Set One; and Plaintiff's Expert Interrogatories Directed to all Defendants - Set One, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 C. Date: t L,3- 0( By: BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 61U) 04U-""/5UU for naintitt Shank and Associates Real Estate, Inc. d/b/a The CUMBERLAND COUNTY, Prudential Franklin Associates PENNSYLVANIA Plaintiff COURT OF COMMON PLEAS V. CIVIL ACTION - LAW Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and DOCKET NO.: 03-5294 Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants PLAINTIFF'S INTERROGATORIES DIRECTED TO DEFENDANT STEVEN B. SPRAY - SET ONE Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, request that the Defendant Steven B. Spray answer the following interrogatories within thirty (30) days from the date of service to the best of his knowledge, information and belief in accordance with and subject to the penalties of 18 Pa. C.S. §4904 relating to unworn falsifications. In providing responses please attach additional pages where necessary. Defmitions "Identify" when referring to a person means to state the name, home and business address, title, and telephone number. "Identify" when referring to a document means to state the title, date, author, recipient and current custodian of any written material. "Identify" when referring to a location requires providing an unambiguous and clear description based on geography, landmarks, monuments, distances, etc. that would enable a reasonable person to determine the location or place identified. "Writings" means all correspondence, memoranda, notes, transcripts, documents and drafts thereof which have been reduced to written form. "Person(s)" refers to any separate legal entity whether natural or otherwise including without limitation partnership, corporation, and individual. "Document(s)" or "Documentation" as used herein shall include without limitation the original and any nonidentical copy of any written, printed, recorded, charted, digitized, taped, graphic or magnetic matter (including, but not limited to, video tapes, audio tapes, and computer tapes and discs), however produced, reproduced or prepared, including without limitation any correspondence, voicemail, email, memoranda, notes, minutes of meetings, records, statements, reports, writings, telegrams, transcripts of telephone conversations or any other writings or documentary material of any nature whatsoever, whether reduced to paper or stated on any computer system, computer disk, computer tape, computer chip or transistor, or stored in any electronic medium together with any attachments thereto and enclosures therewith, and any other photographic and retrievable matter in the possession, custody or control of You and/or Your attorney. "Document(s)" also means any drafts of the foregoing. "Records" is defined as documentation, whether written or electrically maintained, of events, happenings, transactions, contacts, incidents, or actions. "You", "Your" or "Yours" refers to the Defendant Steven B. Spray or anything possessed by him. 2 "Conversations" means any oral statements made from one individual directed to another individual whether in person or by telephone including without limitation any voicemails or phone messages left for another individual. "Statements" is defined as any comments, remarks, representations, announcements, notes, correspondence, memoranda whether oral or written. "Litigation" means the above captioned matter. Instructions A. If any of these Interrogatories cannot be answered in full, answer to the extent possible, specifying the reasons for Your inability to answer the remainder and stating whatever information, knowledge or belief You do have concerning the unanswered portion. B. If any document is withheld or not identified under a claim of privilege, immunity or otherwise, identify each such document and state the date of the document, its author and addresses, each person to whom copies of the document were furnished or to whom the contents thereof were communicated, a summary of the subject matter of the document, the basis upon which the asserted privilege, immunity or other reason for non-disclosure is claimed and the Interrogatories to which the document is responsive. C. If any Interrogatory is objected to by You as inquiring into privileged matters, set forth fully in Your objections the facts upon which You rely as the basis for Your objection. D. When used in the course of an enumeration of items as to which documents or information are requested, the words "of' and "and" are to be construed as requesting documents or information as to each item in the enumeration, the same as if the entire request had been addressed solely to that item. E. These Interrogatories are continuing in nature. If, after answering these Interrogatories, You obtain or become aware of any further information responsive to these 3 Interrogatories, You're required to serve a supplemental answer reflecting all such subsequently acquired information. F. In responding to these Interrogatories, identify all documents or other sources of information which relate to the information requested by the Interrogatory. In lieu of stating the contents of particular documents when requested, you may attach copies of those documents to your Response to the Interrogatories. Interrogatories 1. State the following a. Your name; b. Any other names that you are known by; c. Date and place of birth; d. Residence address(es) for the five (5) years prior to this lawsuit being filed e. Business address(es) during the same period; and f. Occupation g. Name of Employer 2. Have you ever been convicted of a crime involving theft or dishonesty or other crimes other than for summary violations of a motor vehicle law? If so, set forth the nature of the conviction including the date and location where convicted. 4 3. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any employee, independent contractor, licensee and/or agent of Plaintiff regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 4. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any employee, independent contractor, licensee and/or agent of Plaintiff regarding the possibility of any of the forgoing individual(s) working or becoming associated with Defendant Re/Max Realty Agency, Inc. 5. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any non-party to this Litigation regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 6. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any other party to this Litigation regarding this Litigation or its subject matter. For any communications alleged to have been made in writing, please attach a copy of any and all said writings to Your responses. 5 7. Have You or anyone acting on Your behalf obtained from any person any Statement (as defined by the Rules of Civil Procedure) concerning this Litigation or its subject matter? If so, identify: (a) Each such person; (b) When, where, by whom and to whom each Statement was made, and whether it was reduced to writing or otherwise recorded; (c) Any person who has custody of any such Statements that were reduced to writing or otherwise recorded. 8. Have You or anyone acting on Your behalf given any Statement (as defined by the Rules of Civil Procedure) concerning this Litigation or its subject matter? If so, identify: (a) Each person to whom a Statement was given; (b) When and where each Statement was given; (c) Any person who has custody of any such Statements that were reduced to writing or otherwise recorded. 6 9. Please identify all individuals who provided You with any writings and/or documents regarding this Litigation or its subject matter. For any individuals noted, identify the specific writings and/or documents given and attach a copy of those writings and/or documents to Your responses. 10. Please identify all individuals with whom You have discussed this Litigation or its subject matter. 11. Please identify all persons having any knowledge of the facts in this Litigation. Provide the source of that knowledge and a copy of any documents sent to and/or received from the person having such knowledge. 12. Please identify all witnesses You expect to call at trial and provide the substance about which each witness will testify. 13. Please identify all professional licenses that you maintain or have maintained, including any associated license number. Please identify the effective dates for said licenses. 7 14. For each such license that you have identified in response to the previous interrogatory, have you ever been the subject of any disciplinary action? If your answer is in the affirmative, identify the party bringing the discipline, the license and license number involved, any identifying number associated with the disciplinary action, the date the disciplinary action commenced, the parties involved in the disciplinary action and the disposition. 15. Have you ever been the subject of an ethics complaint in any Realtor@ association? If so, please identify the caption of the complaint, the related association, when the complaint was made and the subject matter of the complaint. 16. Have you even been a party to a lawsuit other than the current litigation? If so, please identify the case name, docket number and the court in which it was maintained. 17. Please identify any and all business entities in which you maintain an ownership interest and are in any way involved in the management of said business. 18. For each entity you identify in response to the previous interrogatory, please identify your position with said entity and your job responsibilities. 8 19. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any of the following individuals relating to their becoming employed or associated with Defendant Re/Max Realty Agency, Inc.: a. Diane Ebersole b. Brenda Bodner c. James Heckman d. Donna Peachy e. Jeff Jessell f. Jeff Shatzer g. Craig Schellhase h. Robert Starr i. Lester Swope j. Nancy Shoop 20. Please identify any individual(s) not otherwise listed in interrogatory 19 that worked for Plaintiff directly prior to working for or becoming associated with Defendant Re/Max Realty Agency, Inc. 21. Please identify each and every statement, representation, communication, or fact that was communicated, orally or in writing, between You and any officer, director, employee, independent contractor, licensee and/or agent of Defendant Re/Max Realty Agency, Inc. concerning any of the individuals listed in interrogatory 19 and/or those individuals identified in your response to the previous interrogatory regarding the possibility of any of the said individual(s) working or becoming associated with Defendant Re/Max Realty Agency, Inc. 9 22. Have You ever met with any of the individuals referenced in interrogatory 19 and/or those individuals identified in your response to interrogatory 20 while they were still associated with Plaintiff? If Your answer is in affirmative, please identify when said meeting occurred, where it occurred, who attended and the purpose of said meeting. & ASSOCIATES Date: q w 3 0> David J. SqAW Attorneys > r Plaintiff' 10 BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Attorneys for Plaintiff Shank and Associates Real Estate, Inc. d/b/a The CUMBERLAND COUNTY, Prudential Franklin Associates PENNSYLVANIA Plaintiff COURT OF COMMON PLEAS V. CIVIL ACTION - LAW Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and DOCKET NO.: 03-5294 Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants PLAINTIFFS' REQUEST FOR PRODUCTION OF DOCUMENTS DIRECTED TO DEFENDANT SAMUEL C. SMALL - SET ONE You are hereby requested pursuant to Rule 4009, Pennsylvania Rules of Civil Procedure, to make available to Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates (hereinafter "Plaintiffs") by and through their undersigned attorney, the below listed documents and/or items for purposes of discovery. This material will be examined and/or photocopied, photograph negatives will be processed, and/or photographs reproduced. Said documents, photographs, diagrams, and/or tangible things are to be produced at the law offices of Blair H. Granger & Associates, P.C., 1800 East Lancaster Avenue, Paoli, PA 19301, within thirty (30) days from the date of service hereof and supplemented thereafter in accordance with the rules of the Court. The documents and writings to be inspected and photographed will be duly safeguarded and returned to You with reasonable dispatch on completion of the duplication process, and without harm to the originals. The definitions and instructions set forth in Plaintiffs' First Set of Interrogatories to You are included herein by reference. 1. Please provide all phone records, including but not limited to, bills, invoices, writings, documents, written transcripts of conversations, voicemails, computerized records, and audio tapes of conversations which detail, summarize or express any content of conversations or statements which You received or made with any person or entity, concerning the Litigation or its subject matter. 2. For all conversations, voicemails, etc. referenced in Request No. 1 above, where such phone records are not available as to provide the nature, date, substance and participants of the conversations, voicemails, etc., please provide the same in response to this request. 3. Please provide a copy of all statements made by witnesses, either written or electronically recorded, regarding the happening of any events alleged in any of the pleadings in this matter. 4. Please provide a copy of all statements that have been taken in connection with this litigation, including written statements, transcriptions or recorded interviews and summaries of oral statements. 5. Please provide a copy of all writings, documents, or correspondence, notes, and memoranda, in Your possession or which You have access to, between the parties and/or any representative of a party relating to the Litigation or its subject matter. 2 6. Please provide a copy of all exhibits that You intend to introduce at trial of this matter. 7. Please provide a written list of any and all individuals who have been contacted by You as potential witnesses at trial of this matter, including: name, address, and phone number. Please provide copies of any documents in which those witnesses are referenced. 8. Please provide a copy of any and all documents referring to or relating to the allegations set forth in Your Answer and New Matter, or any other pleadings in this matter. 9. Please provide a copy of any and all documents referring to or relating to Your answers to Plaintiffs' Interrogatories - Set One. & ASSOCIATES Date: //,-I-a 3 BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 Attorney for Defendants Weichert Co. of Pennsylvania 61U 640-73UU and Sheila Firor Shank and Associates Real Estate, Inc. d/b/a CUMBERLAND COUNTY, The Prudential Franklin Associates PENNSYLVANIA Plaintiff COURT OF COMMON PLEAS V. CIVIL ACTION - LAW Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and DOCKET NO.: 03-5294 Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants PLAINTIFF'S EXPERT INTERROGATORIES DIRECTED TO ALL DEFENDANTS - SET ONE Pursuant to the Pennsylvania Rules of Civil Procedure Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates propound the following Expert Interrogatories to all Parties, to be answered within thirty (30) days from the date of service, in writing and under oath, to the best of his/her/its knowledge, information and belief in accordance with and subject to the penalties of 18 Pa. C.S. §4904 relating to unworn falsifications. In providing responses please attach additional pages where necessary. The definitions and instructions set forth in Plaintiff's Written Interrogatories - Set One are included herein by reference. EXPERT INTERROGATORIES 1. State the name, address, occupation and field of specialization, if any, of each person whom you expect to call as an expert witness at trial, and state as to each the subject matter on which the expert is expected to testify. 2. Set forth the qualifications of all those persons listed in the answer to the preceding Interrogatory, and in doing so, as to each expert, list: formal education; schools attended, including years of attendance and degrees or certifications received; experience in particular fields, including names and addresses of employers with inclusive years of employment and positions held, teaching positions and other affiliations including professional and/or technical organizations; and a list of all publications authored by said persons, including the title of the work, the name of the periodical or book in which it was printed, and the date of its printing. (In lieu of answer to this interrogatory, please attach a copy of each expert's curriculum vitae or resume, so long as the same fully and fairly provides the same information). 2 3. (a) Set forth the facts about which each expert you have listed is expected to testify. 3. (b) Set forth the opinions to which each expert is expected to testify. 4. State in detail the factual information supplied to each expert which was used as a basis for forming his/her opinions, including all documents, reports or records furnished, physical evidence, all testimony, statements and reference material reviewed, all physical evidence, objects, test results, inspection reports, photographs, plans or other tangible things provided to each expert for review or inspection. 3 5. Set forth a summary of the factual basis or grounds for each such opinion, including any text material, treatise, journal, or other written materials upon which the expert witness will rely. Identify all such text or other publications, including the name, author, edition and page reference. 6. As to all persons listed in Interrogatory No. 1, state the full caption, court term and number of all cases in which that person has testified in the past five years. If this information is not available, give the name of the cases involved and state the Court where such matter was tried, as well as the approximate date of trial. 7. If any of the opinions of any expert identified herein are based in whole or in part on any code, regulation or standard, governmental or otherwise, identify said code, regulation or standard and specifically set forth each pertinent section relied upon 8. If any of the opinions of any expert identified herein are based in whole or in part on any scientific rule or principle, set forth said rule or principle. 4 9. State the name and address of every person who has been retained, consulted or specially employed by you as an expert in anticipation of litigation or preparation for trial, but who is not expected to be called as a witness at trial. 10. As to all persons listed in Interrogatory No. 1, state the dates and substance of any and all conversations that have taken place between you, your counsel, and the person listed in Interrogatory No. 1. 11. As to all persons listed in Interrogatory No. 1, state the financial consideration being paid by you in return for the testimony of said person and whether any portion or all of said financial consideration is contingent upon you obtaining a given outcome in the case. 5 12. As to all persons listed in Interrogatory No. 1, identify how you located the person including without limitation whether you located the person as a result of reading a publication in which the individual was identified as an expert, reading a publication authored by the individual, receiving a personal reference and/or receiving a recommendation from your counsel. 13. As to all persons identified in Interrogatory No. 1, identify any and all opinions, impressions, or views formulated during the expert witness' review of this matter whether or not such opinions, impressions or views represented the final, conclusive opinion of the expert witness. 14. Provide a copy of any and all draft reports or other documentation received from the expert or that are located in the expert's possession for this matter or that were ever created for or by the expert. 6 15. Provide copies of any and all documents that were received, provided to or in any way were discussed with the expert in reviewing this matter. 16. As to each expert identified herein, set forth whether he or she advertises or otherwise solicits business for consulting or testifying as an expert and set forth the nature of such advertising or solicitation, if applicable, including the publications in which such advertising or solicitation has appeared and such other forms, if any, of communication as have been used by such expert in connection with any such advertising or solicitation. BLAIR H. 1 -4 By: Date 7 TES, P.C. r-a p ' aj ., 00 -) ( } BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. 456025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 610) 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants for Flaintitt CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW 03-5dgy DOCKET NO.:-&3--24&T CERTIFICATE OF SERVICE I, David J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, certify that on this date, I served a true and correct copy of Plaintiff's Motion to Compel Discovery Responses and a proposed order, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 C. Date: 1-16-0 By: : 1 "{ " F' {( CC) ?: -t? SHANK AND ASSOCIATES IN THE COURT OF COMMON PLEAS OF REAL ESTATE, INC., d/b/a THE CUMBERLAND COUNTY, PENNSYLVANIA PRUDENTIAL FRANKLIN ASSOCIATES, Plaintiff CIVIL ACTION - LAW NO. 03-5294 vs. CRAIG SCHELLHASE, individually: and as agent for RE/MAX REALTY AGENCY, INC.; JEFFREY L. SHATZER, individually and as agent for RE/MAX REALTY AGENCY, INC.; SAMUEL C. SMALL, individually and as agent/ broker for RE/MAX REALTY AGENCY, INC.; STEVEN B. SPRAY, individually and as agent/ broker for RE/MAX REALTY AGENCY, INC.; and RE/MAX RELATY AGENCY, INC., Defendants IN RE: PLAINTIFF'S MOTION TO COMPEL DISCOVERY RESPONSES ORDER AND NOW, this 2S " day of January, 2007, a rule is issued on the defendants, Samuel C. Small, Steven B. Spray and Re/Max Realty Agency, Inc., to show cause why the relief requested in the within motion to compel ought not to be granted. This rule returnable twenty (20) days after service. BY THE COURT, r/ A. Hess, J. .y -,I 10 / i ?` t' :3 WIV Q Z NN LI Z BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David.). Scagas, Esquire Attorney I.D. #821 17 1800 East Lancaster Avenue. Paoli, Pennsylvania 19301 ((N 10 ? (,an-7 inn Attorneys for Plaintiff Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiil, V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jcffrc?, L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Rc/Max Realty Agency„ Inc., and Re/Max Realty Agencv. Inc. De i'endants CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEA; CIVIL ACTION - LAW DOCKET NO.: 03-5294 PLAINTIFF'S MOTION TO MAKE RULE ABSOLUTE I . On January 18, 2007, Plaintiff filed a Motion to Compel Defendants Samuel C. Small. Steven B. Spray and Re/Max Realiv t* i4ciic-,'i1c. to Nrt,vide full and complete answcrs, Without objection, to Plaintiff's Interrogatories, Expert Interrogatories and Request For the Production o1? Documents. 2. On January 25, 2007 the Honorahle Kevin A. Hess issued a Rule on said Defend?int, to show cause why the relief requested in Plaintiff's Motion to Compel should not he «ranted. The Rule Returnable date was twenty (20) days after service thereof. See Exhibit "A". 3. In addition to service by the court, Counsel for Plaintiff forwarded a copy of said Rule npon counsel for Defendants by letter dated January 29, 2007. See Exhibit "A". 4. To date, the Defendants have not responded to the Motion to Compfl <?r the Rule. WHEREFORE, Plaintiff respectfully requests this Honorable Court to enter an Order making the Rule Absolute and compel Defendants Samuel C. Small, Steven B. Spray and Re/Max Realty Agency, Inc. provide full and complete answers. without objection. to Plaintiff's writte'i Interrogatories, Expert Interrogatories and Request for the Production of Documents. within twenty (20) days of service of said Order. BLAIR H. (kdA & ASSOCIATES, P.C. l r,, !f i Dated: 13y; ,Y - ? --- -F7avid J. Se' & Esquire- --- -- Attorne --?6 PU!rtiff • • Exht b.+ A S1-1AN1: \NI_> ASS0CLATES IM:AL . _Sl`: 'l L. INC.. cl/b/a 'LHL: PRt !DI"NTIA_. FRANK1,1N ASS0CIA"l ES. Plaintill, CRAIG SCl-li_:LLHASL. individually: and as aw)em l0r RF/MAX REALTY AGI N(. Y. lN('_'...1L1,hI<E'Y L. SHAT/1,'R. individually and as agent for R1:;'TvIAX REALTY AGENCY. IN(_"..- SAIMU L C. SMALL. indil. ideally and as agent/ broker for PT A/IAX REALTY AGENC Y. N(.-I.. STEVEN B. SPRAT. individually and as agent/ broker IOr RE,/MAX REALTY AGENCY. INC.: and M`/MAX RELA"IY AGENCY. INC.. Defendants IN TI IE COURT' OF COMMON I'LLAS ('11 CIJMI3LRLAND COUNTY. PLNNSYL.VA,V CIVIL AC"I'IUN -- I A W NO. 0-5294 IN, I? E: PLAINTIFF'S MOTION TO COMPE1. DISCOVERY RCSPONS I"S ORDER \ND NONA', this Z.? day Of January. 2007, a rule is issued on the defendmt<. Samuel C. Smak. S.evtn B. Spray- and Re/Max Realty Agency, Inc.. to show cause Nvlly the r- licl' requested in _11 Vcithin motion to compel 01,12111t not to be <aranted. ],his mile returnah e t'Wenty (20) da" , alter service. BY TI IE COURT. /f Kevin A., I Less. J. j heCeS?i, 1 tierel?'lI(?? Sid' 'yi? ?1' le4, P S i Cif irk Cowl day :? _ ?„ f I f [.r'r BLAI R H. GRANGER & ASSOCIATES, P.C. Blair 11. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney 1.D. #S21 17 1800 East Lancaster Avenue Paoli. Pennsylvania 19301 (610) 640-7500 Shank and Associates Real Estate, Inc Prudential Franklin Associates Plainti ftf V. Attorneys for Plaintiff d/b/a The CUMBERLAND COUNTY. PENNSYLVANIA COURT OF COMMON PLEAS Craig Schellhase, individually and as agent for Re/Mwr Realty Agency, Inc., and Jcfl*reti, L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker 1'or Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency. Inc. Defendants CIVIL ACTION - LAW DOCKET NO., 03-5294 CERTIFICATE OF SERVICE 1. Da%id J. Scaggs, Esquire, attorney for Plaintiff, Shank and Associates Rca.l Estate, inc. d/h/a J'hc Prr.idential Franklin Associates, certify that on this date. I served a true and correct copy of Plaintiff's Motion to Make Rule Absolute, by UnAed State; Ii-ail, postage-prepalA. as follows: James T. Tupitza. Esquire Tupitza, Altman & Bryman, P.C. 1] 2 W. Gav Street West Chester. PA 19380-2942 BL,gf; H. G AN JER && ASSOCIATES, P.C. Dater _ By. Da) d J. Scq-gs, EsquirC'. MAR 0 fi 200? /k BLAIR H. GRANGER & ASSOCIATES, P.C. Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 (610) 640-7500 Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants Attorneys for Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-5294 ORDER MAKING RULE ABSOLUTE AND NOW, this "'- day of n, 41tA , 2007, upon Motion of Plaintiff Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates, the Rule entered on January 25, 2007, Returnable twenty (20) days after service thereof, is hereby made absolute and Defendants Samuel C. Small, Steven B. Spray and Re/Max Realty Agency, Inc. P-60 ro P.,..0' - shall provide fi44 and ers, without objeC , to Plaintiff's Interrogatories, Expert Interrogatories and Request for the Production of Documents, Directed to Plaintiffs within twenty (20) days of service of this Order. Further, upon application to the Court, sanctions may ter„ >,Ier> ., 7 , ?v ! emit 6 `r t'i i ,:'tJ be imposed if Defendants fail to comply with this Order. BY THE COURT: l THE GRANGER FIRM Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 01U) 64U-/JUU Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants for naintitt CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 2003-5294 PRAECIPE TO SETTLE, DISCONTINUE, AND END TO THE PROTHONOTARY: Please mark the above captioned case V-1-of Date David J. S ,giggs, Esquire Attorney or Plaintiff and ENDED. THE GRANGER FIRM Blair H. Granger, Esquire Attorney I.D. #56025 David J. Scaggs, Esquire Attorney I.D. #82117 1800 East Lancaster Avenue Paoli, Pennsylvania 19301 610) 640-75UU Shank and Associates Real Estate, Inc. d/b/a The Prudential Franklin Associates Plaintiff V. Craig Schellhase, individually and as agent for Re/Max Realty Agency, Inc., and Jeffrey L. Shatzer, individually and as agent for Re/Max Realty Agency, Inc., and Samuel C. Small, individually and as agent/broker for Re/Max Realty Agency, Inc., and Steven B. Spray, individually and as agent/broker for Re/Max Realty Agency, Inc., and Re/Max Realty Agency, Inc. Defendants for Fiaintitt CUMBERLAND COUNTY, PENNSYLVANIA COURT OF COMMON PLEAS CIVIL ACTION - LAW DOCKET NO.: 03-5294 CERTIFICATE OF SERVICE I, Seta George, certify that on this date, I served a true and correct copy of Praecipe to Settle, Discontinue, and End, by United States mail, postage-prepaid, as follows: James T. Tupitza, Esquire Tupitza, Altman & Bryman, P.C. 212 W. Gay Street West Chester, PA 19380-2942 THE GRANGER FIRM Date: By: Seta George, Paralegal Q ?q? ??`r. ?:?. ?a• -T7 [; -? ! "cy -? .?- ` r fT7 v?F . C,fJ ?