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HomeMy WebLinkAbout04-3895IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA STEPHEN A. GEBHARDT, Plaintiff, VS. DOHERTY EMPLOYMENT GROUP, INC., Defendant. CIVIL ACTION - LAW JURY TRIAL DEMANDED ON- 3P45 01v?L C1?n PRAECIPE FOR WRIT OF SUMMONS TO THE PROTHONOTARY OF SAID COURT: Please issue a Writ of Summons in the above-captioned action. Writ of Summons shall be issued and forwarded to Frank P. Clark, Esquire, CLARK LAW OFFICE, 3045 Market Street, Camp Hill, PA 17011 Address of Plaintiff: 1174 Fleming Drive Mechanicsburg, PA 17055 Dated: August 09, 2004 Address of Defendant: c/o National Registered Agents, Inc. 600 N 2nd St Ste 500 Harrisburg, PA 17101 CLARK LAW OFFICE By: Frank P. Clark Attorney I.D. #35443 3045 Market Street, 2nd Floor Camp Hill, PA 17011 (717) 731-8600 Attorney for Plaintiff Commonwealth of Pennsylvania County of Cumberland WRIT OF SUMMONS STEPHEN A. GEBHARDT 1174 FLEMING DRIVE MECHANICSBURG, PA 17055 Plaintiff Vs. Court of Common Pleas No. 04-3895 CIVIL TERM In CivilAction-Law DOHERTY EMPLOYMENT GROUP C/O NATIONAL REGISTERED AGENTS, INC. 600 N 2ND ST STE 500 HARRISBURG, PA 17101 Defendant To DOHERTY EMPLOYMENT GROUP, INC., You are hereby notified that STEPHEN A. GEBHARDT, the Plaintiff has / have commenced an action in Civil Action-Law against you which you are required to defend or a default judgment may be entered against you. (SEAL) Date AUGUST 9, 2004 CURTIS R. LONG Prothonotary Deputy Attorney: Name: FRANK P. CLARK, ESQUIRE Address: CLARK LAW OFFICE 3045 MARKET STREET, 2ND FLOOR CAMP HILL, PA 17011 Attorney for: Plaintiff Telephone: 717-731-8600 Supreme Court ID No. 35443 IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA STEPHEN A. GEBHARDT, VS. Plaintiff, CIVII, ACTION - LAW Docket No. 04-3895 DOHERTY EMPLOYMENT GROUP, JURY TRIAL DEMANDED INC., Defendant. 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 lost; money or property or other rights important to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. CUMBERLAND COUNTY LAWYER REFERRAL SERVICE 32 S. Bedford St. Carlisle, PA 17013 249-3166 NOTICIA Le ban demandado a usted en la cone. Si usted quiere defenderse de estas demandas expuestas en las paginas siguientes, usted tiene viente (20) dias de plazo al partir de la fecha de la demanda y la notificacion. Usted debe presentar una apariencia escrita o en persona o por abogado y archivar en la corte en forma escrita sus defensas o sus objeciones a las demandas en contra de su persona. Sea avisado que si usted no se defiende, la corte tomara medidas y puede entrar una orden contra usted sin previo aviso o notificacion y por cualquier queja o alivio que es pedido en la peticion de demanda. Usted puede perder dinero o sus propiedades o otros derechos importantes para usted. LLEVE ESTA DEMANDA A UN ABODAGO INMEDIATAMENTE. SI NO TIENE ABOGADO O SI NO TIENE EL DINERO SUFICIENTE DE PAGAR TAL SERVICIO, VAYA EN PERSONA O LLAME POR TELEFONO A LA OFICINA CUYA DIRECCION SE ENCUENTRA ESCRITA ABAJO PARA AVERIGUAR DONDE SE PUEDE CONSEGUIR ASISTENCIA LEGAL. CUMBERLAND COUNTY LAWYER REFERRAL SERVICE 32 S. Bedford St. Carlisle, PA 17013 249-3166 Respectfully submitted, CLARK LAW OFFICE Dated: By: Frank P. Clark Attorney I.D. #35443 3045 Market Street Camp Hill, PA 17011 (717) 731-8600 Attorney for Plaintiff IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA STEPHEN A. GEBHARDT, Plaintiff, CIVIL ACTION - LAW Docket No. 04-3895 VS. DOHERTY EMPLOYMENT GROUP, JURY TRIAL DEMANDED INC., Defendant. COMPLAINT NOW COMES Stephen A. Gebhardt (hereinafter "Plaintiff') by and through his attorney, CLARK LAW OFFICE, and brings this Complaint: against Defendant Doherty Employment Group, Inc. (hereinafter "Defendant") and alleges in support thereof as follows: Plaintiff Stephen A. Gebhardt is an adult individual residing at 1174 Fleming Drive, Mechanicsburg, Cumberland County, PA 17055. 2. Defendant Doherty Employment Group, Inc. ("Doherty") is a Minnesota corporation authorized to conduct business in the Commonwealth and which maintains an address for the service of process c/o National Registered Agents, Inc., 600 N 2nd St., Suite 500, Harrisburg, PA 17101. BACKGROUND 3. Plaintiff brings this action under the Pennsylvania Wage Payment and Collection Law (the "WPCL"), Act of July 14, 1961, P.L. 637, as amended, 43. P.S. §260.1 et seq. or alternatively under common law for wages, other compensation, and damages arising on account of employment with Defendant Doherty. FACTS 4. Since in or about June 2002, Defendant Doherty has employed Plaintiff in the capacity as the branch manager for a branch operated by a third party financial services institution. 5. The branch that Plaintiff has managed for all times relevant to this Complaint is situated in New Cumberland, Cumberland County, PA. 6. During the relevant period of time and continuing to the present, Defendant Doherty has been Plaintiff's employer. During the relevant period of time and continuing to the present, Defendant Doherty is responsible for paying Plaintiff's compensation from employment, including but not limited to making all applicable wage withholdings and benefit payments on account of Plaintiff's employment. 8. During the relevant period of time and continuing to the present, Defendant Doherty is responsible for paying the employer share of taxes relating to Plaintiff's compensation from employment, and remitting the same to all relevant taxing authorities. 9. Plaintiff's compensation from said employment is based on the monthly net profit realized from the branch office he operates. 10. Throughout the relevant period, at or near the end of each bi-weekly pay period Plaintiff has submitted a payroll authorization sheet to Defendant Doherty and/or Doherty representative in accordance with established procedures. 11. The payroll authorization sheet lists the employees of the branch, including Plaintiff, and the amount to which each is entitled from the net profits of the branch. 12. Consistently from September 2002 to the present, Plaintiff's branch generated net profit sufficient to permit Plaintiff to earn gross compensation for each bi- weekly period in varied amounts that ranged from a minimmn of $5,000 to a maximum of $40,000. 13. As of July 30, 2004, Plaintiff's branch generated net profit sufficient to permit Plaintiff to earn gross compensation in excess of $25,000 for the pay period ending July 31, 2004. 14. On or about July 30, 2004, Plaintiff submitted a Payroll Authorization Sheet (the "July Authorized Payroll") to Defendant Doherty and/or Doherty's representative covering the pay period of July 18, 2004 to July 31, 2004 for all employees of the branch, including himself, in accordance with the established procedure. 15. The July Authorized Payroll authorized gross pay to Plaintiff in the amount of $25,000. 16. On or about August 6, 2004, Plaintiff received a paycheck from Defendant Doherty in the gross amount of $355.00 for the pay period ending July 31, 2004. 17. On August 6, 2004, Plaintiff advised Defendant Doherty that it failed to pay Plaintiff the amount due as per the July Authorized Payroll and that the failure to pay in accordance with the July Authorized Payroll constituted bad faith on Defendant Doherty. 18. As of August 13, 2004, Plaintiff's branch generated net profit sufficient to permit Plaintiff to earn gross compensation in excess of $10,000 for the pay period ending August 14, 2004 and paid on August 19, 2004; this amount is in addition to the $25,000 gross compensation that Plaintiff included on the July Authorized Payroll. 19. On or about August 13, 2004, Plaintiff submitted a Payroll Authorization Sheet (the "August Authorized Payroll") to Defendant Doherty and/or Doherty's representative covering the pay period of August 1, 2004 to August 14, 2004 for all employees of the branch, including himself, in accordance with the established procedure. 20. The August Authorized Payroll authorized grass pay to Plaintiff in the amount of $10,000. 21. On or about August 19, 2004, Plaintiff received a paycheck from Defendant Doherty in the gross amount of $355.00 for the pay period ending August 14, 2004. 22. Defendant Doherty has continued to refuse to pay Plaintiff the amounts due him from the July Authorized Payroll and August Authorized Payroll, despite demands from Plaintiff for payment in full. COUNTI BREACH OF CONTRACT 23. The averments of paragraphs one 1 through 22 are incorporated herein as if set forth in full. 24. Plaintiff was employed by Defendant Doherty subject to an express or implied agreement that his compensation would be payment under the terms described above. 25. Defendant Doherty wrongfully withheld and/or refused to pay Plaintiff compensation to which he was lawfully entitled. 26. Defendant Doherty breached its promise to pay Plaintiff compensation to which he was lawfully entitled and is liable to Plaintiff for payment of the same, together with interest. 27. As a result of the breach, Plaintiff is entitled to recover as damages all compensation that Defendant Doherty wrongfully failed to pay Plaintiff, or alternatively, the reasonable value of Plaintiff's services. 28. Plaintiff's damages are not presently determined with precision and will be so determined in the course of discovery; Plaintiff reasonably believes and avers, however, that his damages are currently in excess of $34,000, exclusive of interest and costs of suit. 29. Plaintiff believes and avers that Defendant Doherty's non-payment of Plaintiff's compensation is ongoing and will continue to occur. 30. Plaintiff is obligated to provide services at the New Cumberland branch through September 1, 2004, after which his employment will end. 31. Plaintiff believes and avers that Defendant Doherty will continue to refuse to pay Plaintiff's compensation for services rendered during the pay period beginning August 14, 2004, and ending September 1, 2004, causing additional losses to Plaintiff in amounts that are not presently unknown but which will be determined in the course of discovery and for which Defendant Doherty is additionally liable to Plaintiff. WHEREFORE, Plaintiff demands judgment in his favor and against Defendant Doherty Employment Group, Inc., in an amount in excess of $25,000, the jurisdictional limit for mandatory arbitration of claims in Cumberland County, together with costs and such other further relief as may be just. COUNT II WAGE PAYMENT AND COLLECTION LAW 32. The averments of paragraphs 1 through 28 are incorporated herein as if set forth in full. 33. Defendant Doherty is Plaintiff's "Employer" as that term is defined under §2.1 of the WPCL, 43 P.S. §260.2a. 34. Plaintiff`s earned compensation as determined through the relevant Authorized Payroll are "wages" due Plaintiff as that term is defined under §2.1 of the WPCL, 43 P.S. §260.2a. 35. Since the calendar quarter beginning July 1, 2004, Defendant has withheld, retained and/or refused to pay Plaintiff wages in excess of $34,000, an amount that exceeds five percent (5%) of the gross wages payable to Plaintiff on any two regularly scheduled paydays in the same calendar quarter. 36. Plaintiff's wages have remained unpaid and/or alternatively will remain unpaid by Defendant Doherty for thirty days beyond Plaintiff's regularly scheduled payday. 37. Defendant Doherty is prohibited from making any deductions from Plaintiff's wages except as provided under §3 of the WPCL, 43 P.S. §260.3, as is described more fully in regulations found at 34 Pa. Code §9.1. 38. Defendant Doherty made unauthorized deductions from Plaintiff's wages in violation of §3 of the WPCL, 43 P.S. 260.3. 39. Defendant Doherty has made no good faith assertion of a set-off or counterclaim in response to Plaintiff's demands for payment of his wages. 40. Defendant Doherty has failed to make lawful payment of Plaintiff's wages in violation of the WPCL, entitling Plaintiff to an award of an award of attorney's fees pursuant to §9.1 of the WPCL, 43 P.S. §260.9a. 41. Defendant Doherty withheld Plaintiff's wages in bad faith, and/or in violation of § 10 of the WPCL, entitling Plaintiff to an award of liquidated damages under § 10 of the WPCL, 43 P.S. §260.10. WHEREFORE, Plaintiff demands judgment in his favor, and against Defendant Doherty Employment Group, Inc., for an amount greater than $25,000, in excess of the jurisdictional limit for mandatory arbitration of claims in Cumberland County, together with interest, reasonable attorneys fees, costs, liquidated damages, and such other further relief as may be just. Respectfully submitted, CLARK LAW OFFICE Dated: August 25, 2004 By._ Frank P. Clark' Attorney I.D. #35443 3045 Market Street, 2nd Fl. Camp Hill, PA 17011 (717) 731-8600 VERIFICATION The undersigned, Stephen Gebhardt, hereby verifies that he is the Plaintiff' in the above-captioned matter, that he is authorized to execute this Verification on his own behalf, and that the facts set forth in the foregoing Complaint are true and correct to the best of his knowledge, information and belief and further states that false statements herein are made subject to the penalties of 18 Pa.C.S. § 4904 relating to unworn falsification to authorities. CERTIFICATE OF SERVICE I, FRANK P. CLARK, do hereby certify that I served a true and correct copy of the foregoing Complaint upon the following below-named parties by hand delivery, today, August 25, 2004. SERVED UPON: Doherty Employment Group, Inc. c/o National Registered Agents, Inc., 600 N 2nd St., Suite 500 Harrisburg, PA 17101 d"L G r-ow,P Frank P. Clark I (??) SHERIFF'S RETURN - OUT OF COUNTY CASE NO: 2004-03895 P COMMONWEALTH OF PENNSYLVANIA: COUNTY OF CUMBERLAND GEBHARDT STEPHEN A VS DOHERTY EMPLOYMENT GROUP 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: DOHERTY EMPLOYMENT GROUP but was unable to locate Them in his bailiwick. He therefore deputized the sheriff of DAUPHIN County, Pennsylvania, to serve the within WRIT OF SUMMONS On August 27th , 2004 , this office was in receipt of the attached return from DAUPHIN Sheriff's Costs: Docketing 18.00 Out of County 9.00 Surcharge 10.00 Dep Dauphin Cc 26.25 .00 63.25 08/27/2004 CLARK LAW OFFICE Sworn and subscribed to before me this 1,4*- day of ?tax" - aanY A. D. rothonotarf So answers:--, 77-? R. Thomas Kline Sheriff of Cumberland County In The Court of Common Pleas of Cumberland County, Pennsylvania Stephen A. Gebhardt vs. Doherty L]nployment Group Inc. No. 04-3895 civil Now, August 11, 2004 , I, SHERIFF OF CUMBERLAND COUNTY, PA, do hereby deputize the Sheriff of Dauphin 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 at by handing to a , 20_, at o'clock M. served the copy of the original and made known to the contents thereof. So answers, Sheriff of County, PA Sworn and subscribed before me this ! day of , 20` COSTS SERVICE $ MILEAGE AFFIDAVIT (Wfitr?e of t4.e ?hrri ff Mary Jane Snyder Real Estate Deputy William T. Tully Solicitor Dauphin County Harrisburg, Pennsylvania 17101 ph: (717) 255-2660 fax: (717) 255-2889 Jack Lotwick Sheriff Commonwealth of Pennsylvania GEBHARDT STEPHEN A vs County of Dauphin DOHERTY EMPLOYMENT GROUP INC Sheriff's Return No. 6394-T - - -2004 OTHER COUNTY NO. 04-3895 AND NOW:August 17, 2004 at 12:20PM served the within J. Daniel Basile Chief Deputy Michael W. Rinehart Assistant Chief Deputy SUMMONS upon DOHERTY EMPLOYMENT GROUP INC by personally handing C/O NATIONAL REGISTERED AGENTS INC to LINDA WALAS-OFFICE MANAGER 1 true attested copy(ies) of the original SUMMONS and making known to him/her the contents thereof at 600 N 2ND STREET SUITE 500 HARRISBURG, PA 17101-0000 Sworn and subscribed to before me this 19TH day of AUGUST, 2004 NOTARIAL SEAL MARY JANE SNYDER, Notary Public Highspire, Dauphin County My Commission Expires Sept. 1, 2006 So Answers, V;/*? r? )k Sheriff of Dauphin Court By De y Sheriff Sheriff's Costs:$26.25 PD 08/18/2004 RCPT NO 198759 ET IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA STEPHEN A. GEBHARDT, CIVIL ACTION - LAW Plaintiff, V. Docket No. 04-3895 DOHERTY EMPLOYMENT GROUP, INC. JURY TRIAL DEMANDED Defendant. NOTICE TO PLEAD TO: Plaintiff You are hereby notified to file a written response to the attached preliminary objections within twenty (20) days from service hereof or a default judgment may be entered against you. September 13, 2004 Mars a . IS r IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA STEPHEN A. GEBHARDT, Plaintiff, V. DOHERTY EMPLOYMENT GROUP, INC. Defendant. CIVIL ACTION - LAW Docket No. 04-3895 JURY TRIAL DEMANDED PRELIMINARY OBJECTIONS OF DEFENDANT DOHERTY EMPLOYMENT GROUP. INC. Defendant Doherty Employment Group, Inc. ("Doherty"), asserts its preliminary objections to the complaint and seeks dismissal for failure to conform to rule, failure to join a necessary and indispensable party, and for lack of subject matter jurisdiction. On August 25, 2004, Plaintiff Stephen A. Gebhardt filed suit in this Court against Doherty, seeking to recover wages, compensation and damages "arising on account of employment with Defendant Doherty." See Complaint at ¶ 3. 2. The complaint alleges that Doherty employed Plaintiff in the capacity as the branch manager for a branch operated by a third-party financial services institution. See Complaint at ¶¶ 4 and 6. 3. The complaint alleges that Doherty is responsible for paying Plaintiff s compensation "from employment." See Complaint at ¶ 7. 4. The complaint alleges that Plaintiff's compensation is based on the monthly net profit realized from the branch office he operates. See Complaint at ¶ 9. 5. The complaint alleges that Plaintiff was employed by Doherty "subject to an express or implied agreement that his compensation would be payment under the terms" allegedly described in the complaint. See Complaint at ¶ 24. HA-149319 Q Failure to Conform to a Rule of Court (Pa RCP 1028(a)(2)) 6. Plaintiff bases his claim on an alleged agreement. See Complaint at ¶ 24. 7. Pursuant to Pa. R.C.P. 1019(h), Plaintiff is required to state in his complaint if the agreement is oral or written. 8. Plaintiff has failed to comply with Rule 1.019(h) by failing to state whether the agreement serving as the basis for his complaint is oral or written. 9. Pursuant to Pa. R.C.P. 1019(1), when a claim is based on a writing, the pleader must attach a copy of the writing or, if the writing is inaccessible to the pleader, the pleader must state in the pleading that the writing is inaccessible, state the reason the writing is inaccessible and describe the substance of the writing. 10. To the extent that Plaintiff s claims derive from a written agreement, Plaintiff has failed to comply with Rule 1019(i) by failing to attach a copy of the writing. 11. Only one agreement establishes the basis for Plaintiffs employment and compensation, and that is a written agreement. 12. The written agreement establishing the terms and conditions of and compensation for Plaintiff s employment is not between Doherty and Plaintiff, but instead between Superior Mortgage Corp. and Plaintiff. See Branch Manager Employment Agreement dated July 2, 2002, between Superior Mortgage Corp. and Plaintiff ("Branch Manager Employment Agreement') (attached as Tab "A"). 13. Therefore, the Court should sustain this preliminary objection and dismiss the complaint for failure to comply with a rule of court. Pa. R.C.]°. 1028(a)(2). Failure to Join Necessary and Indispensable Party (Pa RCP, 1028(a)(5)) 14. The complaint alleges two causes of action„ both of which are premised on an alleged employer-employee agreement between Doherty and Plaintiff, respectively. 15. Plaintiff has no employment agreement with Doherty. 16. To the contrary, Plaintiff has an employment agreement with Superior Mortgage Corp. See Branch Manager Employment Agreement (Tab "A"). 17. Pursuant to the Branch Manager Employment Agreement, Superior Mortgage Corp. employed Plaintiff and Plaintiff accepted employment with Superior Mortgage Corp. See Branch Manager Employment Agreement (Tab "A") at 12, 18. To the extent that Plaintiff is owed wages and compensation as alleged in the complaint, such wages and compensation are owed by Superior Mortgage Corp., not Doherty. 19. Doherty is a professional employer outsourcing organization, retained by Superior Mortgage Corp. to provide human resource management services, including payroll services. 20. Doherty has no employment agreement or other agreement with Plaintiff. 21. Superior Mortgage Corp. is solely responsible for the operation of its financial services business and compensation to its branch managers, including Plaintiff. 22. Superior Mortgage Corp. has not been named as a defendant in this action. 23. As Plaintiffs employer, Superior Mortgage Corp. is a necessary and indispensable party to this action. 24. Plaintiffs' failure to include Superior Mortgage Corp. as a defendant warrants the dismissal of this action. 25. Therefore, the Court should sustain this preliminary objection and dismiss the complaint for failure to join a necessary and indispensable party. Lack of Subject Matter Jurisdiction (Pa RCP 1028(a)(1)) 26. The Branch Manager Employment Agreement between Plaintiff and Superior Mortgage Corp. contains a forum-selection clause. See Branch Manager Employment Agreement (Tab "A") at 113. 27. The Branch Manager Employment Agreement expressly provides that "[e]ach party hereby consents to the personal jurisdiction of the Federal or New Jersey state courts located in Camden County or Burlington County, New Mersey, and agrees that all disputes arising from this Agreement shall be prosecuted in such courts.... Each party hereby agrees that the jurisdiction of the foregoing Federal and New Jersey state court shall be exclusive, ...." See Branch Manager Employment Agreement (Tab "A") at ¶ 13. 28. Therefore, the Court should sustain this preliminary objection and dismiss this case for lack of subject-matter jurisdiction. WHEREFORE, Defendant Doherty Employment Group, Inc. respectfully requests that the Court sustain these preliminary objections, dismiss the complaint, and award Defendant such relief as may be appropriate. Respectfully submitted, Dated: September 13, 2004 David . F' e ?- Pa. Sup. t. o 66742 Marsha A. Sajer Pa. Sup. Ct. No. 86350 Kirkpatrick & Lockhart LLP Payne-Shoemaker Building 240 North Third Street Harrisburg, PA 17101 (717) 231-4500 (717) 231-4501 Fax Counsel for Defendant Doherty Employment Group, Inc. VERIFICATION I, Valerie Doherty, am Chief Operating Officer of Doherty Employment Group, Inc., and am authorized to make this verification on behalf of Doherty Employment Group, Inc.. I verify that the facts stated in the foregoing Preliminary Objections of Defendant Doherty Employment Group, Inc. are true and correct to the best of my knowledge, information and belief. I understand that false statements herein are made subject to the penalties of 18 Pa.C.S. § 4904 relating to unworn falsifications to authorities. Valerie Doherty Dated: q - /49- 0 y CERTIFICATE OF SERVICE I certify that on September 13, 2004, a copy of the foregoing Preliminary Objections of Defendant Doherty Employment Group, Inc. was served by first class mail, postage prepaid, on the following person: Frank P. Clark, Esq. Clark Law Offices 3045 Market Street, 2nd Floor Camp Hill, PA 17011 Counsel for Plaintiff Marsh A a , 71 F' + J I LL co io is -< l ????? ?x SEP-07-2004 15:24 LENTZ-GENGRRO 973 669 8960 P.02 X33 BRANCH MANAGER MOLOyAffM AGREEMENT This Agreement dated July 2, 20D2 between Superior Mortgage Corp., a New jersey corporation with principal offices at 1395 Route 539, Tuckestw, New Jersey 080E>7 (hereinafter the "Company'? and Stephen A. Gebhardt (hereinafter the "Maaegcr"). WHEREAS, the Company is a mortgage banlcing company licensed by ft Commmatveal'5 of Pennsylvania offering mortgage products to the general public; and WHEREAS, the Company desires to employ the Manager for the purposes of establishing, staffing and managing a Branch Office tO be located at 518 Bridge Street Now Cumberland PA 17670 (the `Branch Office'). NOW, THEREFORE, in consideration of the covenants set forth herein, the parties agree as follows: 1. Branch Office. The company will take guy and all action noonsary to license with the ommonwsealth of Pe a0fftc uua an approved branch office under its mortgage: banking Department of Banking. 2_ Employment. The company hereby employs the Manager and the Manager accepts employment as a aset s mortgage solicitor the Branch Manager and the supervisor of the Branch Office to lid serve as term of his employment pursuant to this Agreement, Manager shall e offer mresidential oregagage e mortgage employes of any other company during this period or solicit, originate, s o loans for any other company during the tern hereof. 3. Primary Marketing Area. It is understood that the subject Branch Office is located in Pennsylvania, with Blair, Cumberland, Dauphin, York, Perry, Lebanon mod Adams Counties, Pennsylvania as its it of mar sting a primary marketing arcs- The Company is not representing this area as an exclusive area and is not if TU restricting branch originations only to this area. hou the right confl , eting activity rah place to restrict a both between Branch Managers, the Company reserves parties if the parties cannot settle their own dispute. As part of this marketing area, branch will conduct business out a third party basis with professionals in the financial services industry that are licensed mortgage brokers. Company's wholesale division will not solicit these brokers d ri gt e ?p of that Managrr's crriployment. Likewise, Manager will nDt solicit tradition would normally be considered as clients of Company's who] sale di isio g and materi signagv the name Superio Home the 4. must Advertising approo and Use of Name. and fe Breach Office shall oparate unutilderized must b be approved by the Company Mortgage Corporation. 5_ Due Diligence. a, During the terra of his employment pursuant to this Agreement Ivfanager shall serve the Company faithfully and to the best of his ability and shall devote his time, enengY, and diligence to the performance of the duties assigned by the Company and shall adhere to and comply with all policies and procedures establisbed by the Company. SEP-07-2004 15:24 LENTZ-GENGRRD 973 669 9960 P.03 b. 1`0.1withstending the foregoing, Manager shall be principally responsible for, and shall have full power and authority in, directing the management and operation of the Branch Office as aforesaid, including, but not limited to, the secuain; of appropriate space, the hiring, training, and management of employees, marketing and sales activities relating to the Company's mortgage products, and compliance witb all applicable requirements of any federal or state laws regarding the origuaation, solicitation, and closing of mortgage loans and any applicable laws or regulations concerning the Company's products, faeflitits and business. 6. Compensatiott. Manager's cornpettsation will be based on the monthly net profit realized from the operation of the Branch Office. The monthly net profit figure will be derived from the balance sbown on the Branch office's monthly "Gross Profit Account" ("GPA'). The GPA is a ledger account that the company maintains as an internal accounting mechanism to track eacb Branch Office's income and expenses. Standard accounting practises are utilized to establish the mo ti lly the: balance balance, e,Outside of rive negative formula, no other compensation will be paid to the Manager. I figure, no compensation will be due to the Manager for that month. Amy negative monthly balance of the GPA will be carried forward to the following mouth. Adjusttoents to the OPA are outlined below. a. 'Ilse Gross Profit Account will be used to record (1) the receipt of all revenue generated by mortgage loans originated through the Branch Office including all application fees, commitment fees, borrower points, all funds paid to the Company by investor: including premiums and service of release premiums, if any, and all other faes (except third pasty fees) paid by borrowers and (2) o the costs, expenses, and debits of operating the office as set forth in subparagraph (b) below, b. The following amounts will be debited from the Gross Profit Account: i. I)ebits as listed on Addendum "A," Schedule, of Basis Point Debits; Loan fees per addendum 'B'; ii. An accounting expense allocation equal to 5400 per month except that if rite Branch Office employs more than 3 employees, such expense allocation will be increased 550 per month per additional employee; Iii. Miscellanc*us expenses including: 1. All costs and penalties (such as reversal of Servicing Release premiums) from investor.; for early peyoff of loans that were originated by Branch Office and closed by Company. Z. Costs and fees for extended rate looks regardless of whtther or not the loan closes; iv. Any and all compensation to be paid to mortgage solicitors and other personnel working out of the Branch Office, including the costs of benefits and taxes, wlsfah compensation, btnefrts and taxes will be paid directly by the Company; V. Any monies paid directly by the Company to third parties or to the Manager as reimbursement pursuant to V of this Agreement; vl. All licensing and boarding costs as set forth in 17c below; provided, however, the parties agree that the company retains the right to change, from time to time, the amounts set forth in subparagraphs i through 1v and to establish different pricing for new products, on thirty (30) days written notice to MAXAGM SEP-07-2004 15:25 LENTZ-GEN3RRO 973 G69 8960 P.04 e. The parties as that the Company maintains a immrmum balance: of 55,000 in the Gross Profit Account This amount is designed to provide cash flow for the payment of Company approved expanses for the office throughout the :swath. This balance will be established by debiting the Gross Profit Account in the amount the net revenue from each loan closed trail the entire balance is established. The Company retains the right to change, from time to time, the amounts set forth in this subparagraph on thirty (3D) days written notice to Manager. Changes may be based ae the number of employees in the branch, volume of closed loans and/or total overhead costs to rim the branch. 7. Office Expenses. Although the Company will be responsible for the payment of all eXlxnses, the Manager will be responsible for managing the expenses of the Branch Office. To the extent that any of these expenses are paid directly by the Company or the Company reimburses Manager J 6T such expenses, such expenses will be deducted from the Gross Profit Account as set forth in 16 above. Company will not be responsible for any unauthorized expenses including, but not limited to, travel, employee bonuses, meals, enter einment and employee reimbursements. Braneb Office expenses are outlined below' a Fxpenses involved in operating the Branch Office inchrde, but are riot limited to, rent, utilities, office equipment maintenance and rental, telephones, odvartising, worker's compensation insurance, hazard and liability insurance, computer software and services, forms, supplies, facsimile machines, secretarial assistance or employment of service assistance. taxes an subject office, office supply needs (such as business cards, direct mailing supplies, letterhead, special courier smmce, postage, signs, advertising) and other such expenses, and all necessary fees and expenses of matTmning any professional licenses of a Manager or other employee at the Stanch office, as well as, all exl.=ses relating to loan processing such as credit reporting and appraisals. b. Expenses connected with Branch Office employees utilizing Company authorized automated underwriting systems such w FNMA's Desktop Underwriter or MMMC's Loan Prospector. These expenses include, but are not limited to, all per loan fats charged by the automated underwriting system vendor, telephone access charges and credit reporting charges. Company will credit the Branch Office's Gross Profit Account for the per loan fee charged by the automated underwriting system vendor for any loan that closes where Company is allocating a commitment fee expanse to the Branch Office's Gross Profit Account. c. Any and all contracts, agreements and !cases for the various Branch Office vendor relationships must be approved by Company in writing. Any and all contracts, agreements and leases for the Branch Office that are or were entered into by the individual Branch Manager are to be assumed by the Company by written agreement making the Company financially responsible fur all payments, as long as, this vendor Agreement remains in effect. Company will only assume Tespo bty for Company approved relationships. All such costs and payments shall be deducted from the Gross Profits Account as set forth in 16b above. In the event that this Agreement is terminated. Company will no longer be financially responsible for the payments to these vendors. 'Ilse responsibility of any vendor agreements that Company assumed in consideration of this Agreement will revert back to Manager- d- The Company shall be responsible for the payment of all fees far the Branch Office license and shall obtain and pay for all bonds required by Commonwearth of Pennsylvania Department of Banking for the operation of the Branch Office and the maintenance of individual and owporato bcense s.'ncmsc costs shall be debited from the Gross Profit Account. SEP-07-2004 15:25 LENTZ-GENGRRO 973 669 8960 P.05 e. Manager and all salesmen and other employees hired by the Company at the Breach Office will be eligible to enroll and participate in any and all employee benefit programs offered generally to employees of the Company and the cost of such benefits shall be calculated by the Company and debited from the Gross Profit Account 8. Fees Colleeted. Manager will remit all fees collected, including but not limited to, fees for commit meats, credit reporting, legal review, application fees or appraisal fees, in full to the Company whether paid in advance or out of proceeds from closing. 9. Responsibilities of the Manager. In the operation of the Branch Office and the solicitation and closing of loans, The Company and Manager agree as follows: a, that Manager may select and add testified appraises to the list of certified appraisers maintained by the company pursuant to such policies rind procedures as the Coinpatty and its investors shall adopt from time to time; b. that Manager will process applications taken at the Branch Offia- without the prior approval of the Company, except as mutually agreed between the parties; c. that Manager may only "lock in" interest rates on a best efforts basis for applicants with the approval of designated offices of the Company and pursuant to the policies and procedures established by the Company for that purpose. For any loan that Manager chooses to lock in, Company has the option to choose an alternative lock uildelivery method than the original best efforts selection made by the Manager, This includes, but is not limited to, l*ing in with a diS'trent investor/lender than that originally chosen by the Manager, lociting in for a different term than what was originally requested, ]outing in using ao alternate delivery method such as mandatory delivery, and/or including the loan in a pool for secondary market delivery. If Company chooses to exercise this option, the original rate and fee combination, and lock expiration requested (aswining the requested) terms were available from the investor that Manager was choosing to look with) will be honored to the applicant and to the Manage' in calculating Gross Profit Account revenues. Any pricing adjustments that may result from Company choosing an alternative lock in execution, whether positive or negative, will impact Company and will not be reflected on Branch Office's Gross Profit Account. d. that Manager will conduct business and regulate procedures at th- Branch Office in a mariner which will maintain and increase she goodwill, business and reputation of both Manager and the Company: e, that Manager will be responsible for the clearing of pre-closing and post-closing conditions in a timely manner to assure customer satisfaction, as well as, the timely funding of the loan; f. that the Company shall provide Manager with any and all updates and changes in investor policies, guidelines, standards, fee charges and rate sheets in a timely mariner. Exceptions to this are that Company is not obligated to provide underwriting guidelines or direct pricing for investors that Company chooses to use On its Sub-Prime Division's Product menu, and that Company will not provide pricing for sale of pooled loans or other secondary market transactions; g, that Manager will forward to the Company on a timely basis any and all fees collected from borrowers; SEP-07-2004 15:26 LENTZ-GENGRRO 973 669 8960 P.06 h. that the Company will process borrower lack-in requests in a timely marmor and promptly notify Manager upon the receipt of confirmation of such lock-ins from investors; L that Manager is required to maintain certain loans files, account ledgers, documents, receipts, vouchers and other business records as required by law and by the Company pttrsuaat to its policies and procedures ("books and records"). These books and records are and will remain the property of the Company at all times, both during and after the employment of the Manager and the term of this Agreement. Manager shall maintain such books and records at the Branch Office unless otherwise mutually agreed with the Company and shall make all books and records available to auditors, accountants, )age] counsel and other persons designated by the Company on reasonable notice; j. that Company will procure insurance for the Branch Office to the extent outlined in the Reference Manual, except that all such costs shall be deducted from the Cm>ss Profits Account as set forth in q6b above. 10. Refermce Manual. The Company shall provide the Manager with a Reference Manual establishing the policies and procedures and otber related information applicable to the management of the Branch Office, the pricing of mortgage loan products, and the relationship between the Company and the Manager, which manual can be modified in part or in W`hole at any time and from time to time by the Company immediately upon written notice to the Manager- The Reference Manual, and all revisions thereto, am expressly incorporated herein by this raference and made a part of this Agreement in all respects. I I.Basi cress Affiliations. Any business afRations that Manager is involved in must be approved by Company in writing. This includes but is not limited to affiliations with title companies, real estate companies, first or second mortgage leaders and commercial lenders. An affiliation would include a business arrangement where there may or may not be an ownership interest Any liability that is created as a result of Manager entering into an unapproved affiliation will be the solo responsibility of the Manager. 12. Assignment This Agreement may not be assigned by Manager adthout the prior written consent of the Company. 13. Choice of YawIF'orun?Personal and Subjeet'Matter -TWUdieflon. This Agreement and all questions relating to its validity, interpretation, performance and enforcement shall be governed by, and construed in accordance with, the laws of the State of New Jersey, without giving effect to the principles of conflicts of laws. Each patty hereby consents to the personal jurisdiction of the Federal or New Jersey state courts located in Camden County or Burlington County, New Jersey, and agrees that all disputes arising from this Agreement shall be prosecuted in such courts. Each party hereby agrees that any such court shall have in personatn jurisdiction over such party and consents to service of process by notice sent by regular marl to the address set firth above and/or by any means authorized by New Jersey law. Each party hereby agrees that the jurisdiction of the foregoing Federal and New Jersey state courts shall be exclusive, and that no patty will No or prosecute litigation in any other venue, nor %41 any patty raise any objection to the jurisdiction of sucb courts. 14. Relationship of the Parties. This Agreement creates an employer-employee relationship between the Company and Manager. The Manager, and all the other salespeople and employees operating out of SEP-07-2004 15:26 LENTZ-GENGRRO 973 669 6969 P.O? the Branch Office, will be "employees at will" subject to termination by the Company as set faith in 116 hereinafter. 15. Legal Fees. If either party to this Agreement commences legal action against the other to enforce the mnns and conditions set forth herein, the losing patty in such lawsuit shall be responsible to pay the court costs and reasonable attorneys' fees of the other parry. 16. Teru"ation, a. This Agreement may be terminated by Manager or the Company at any time on thirty (30) days Prior written notice. In the event of the termination of Manager's employment, Manager will be paid 100% of the compensation defined above for those loans which close widlia sbrty (60) days (or otherwise as required by state law) of the notice of termination, No further compensation, salary, or commissions will be due and payable to Manager for any loans which close thereafter. Manager will continue to be responsible for all costs and expenses of the Branch Office after termination according to the terms of this Agreement. Additionally, Manager will continue to be responsible for closing and finding all loans up to mod including termination date according to the terms of this Agreement b. The Company may terminate the Manager's employment, and the employment of any person employed at the Srmroh Office immediately if due to the Manager's llross negligence, disloyalty, fraud, failure of the Manager to comply with any applicable law, including licensing requirements, the regulations of all state, fuleral, or mortgage lending agencies, the filing by the ldlanager of any petition in bankngmy or a petition for protection from creditors, dishonesty or wilful violation of the Company's written policies. If the Manager's employment is terminated pursuant to this paragraph, the Company shall pay to the Manager the compensation payable to the Manager ficr the month in which such termination occurs„ prorated to the day of termination (or otherwise tes required by state law). The Company shall have no further financial obligation to the Manager pursuant to this Agreement. Regardless of the effective date of termination of the Manager's employment hereunder, the Company may require the Manager to quit The Company's premises at any time following delivery of written notice of termination hereunder. Manager will continue to be responsible for all costs and expenses of the Office afar termination according to the terms of this Agreement:. 17. TndenuMeation. Fach pasty shall indemnify and bold harmless the other from any claims, losses, penalties, fines, forfeitures, legal ices and related costs, judgments, and any other costs, fees and expenses that the other may sustain in any way related to the failure of a party to perform its duties in strict compliance with the tennis of this Agreement including, but not limited to, the compliance with all laws and regulations relating to the operations of the Branch Office. In addition, Manager has the responsibility to manage the office and the affairs of the office in strict compliance with all federal, state, private investor and Company rules and regulations. Any claims, losses, penalties, fines, forfeitures, legal fees and related costs, judgments, and any other costs, fees and expenses that the Company may sustain in any way related to the Branch Office will be debited against the Gmoss Profit Account. This includes any loses that may occur due to acts, omissions, negligence:, fraud, or misrepresentation on the part of Manager, any employees working at the Branch Office or any of the Manager's business sources, including butnot limited to Menager's mortgage broker clientele. If there is insufficient funds in The Cross Profit Account to cover any losses, The Company reserves the right to hold the Manager rtsponsible for financial losses wli= the aand/or wh fraud has occurred by the Manager ae or any of the employees tender his supervision. Agreement has failed to perform his duties under this SEP-07-2004 15:27 LENTZ-GENGRRO 973 669 9960 P.09 18. Complaints. Any and all complaints raid cancellations made to the Manager or any employee at the Branch Office by any customer or third parties shall be immediately reported, in writing, to the Company even if such complaint of cancellation appears groundless to the Manager. 19. Bank Accounts. At no time shall the Manager or any loan officer or employee at the Branch Office have access to of open any checking, savings, trust or other bank account in the name of the Company or any of its alternate or trade names without the prior written consent of the Company. 20. Arbitration. Any controversy or claim arising out of or relating to this Agreement or the breach thereof shall be settled by arbitration pursuant to the rules of the American Arbitration Association and judgment upon award rendered by the arbitrator may be entered into any court having jurisdiction hereof. 21. Intirc Agreemaent. This Agreement and the Reference Maunral described in q10 contain the entire understanding between the parties with respect to the subject matter lureof, and there areno representations, warranties, iuducements, promises, arrangements, oral or otherwise between the parties other than as set forth herein. This Agreement may be amended from time to time by written notice signed by the parties; the Reference Manual may be amended as set forth in 910. 22. Confidentiality. The Company and Manager And= We that they will each maintain complete confidentiality regarding each other's business sources, customers and clients and will only disclose such sources, customers and clients as required pursuant to state and federal law governing mortgage banking activities. 23. Enforceability. if any provision of this Agreement is held invalid or unenforceable the other provisions shall remain in full force and effect. 24. Gender. The use of the masculine gender in this Agreement is to be considered generic and interchangeable for tltc purpose of referring to either the masculine or feminine gender. For example, the word' his' may be ed for th word "has," ver Date ATT13ST: 2Sa2 Da I, ecre ?. ]late SEP-07-2004 15:2? Q O z 0 a G O U tit! d O m a m o ? E W O DI O r y m 4 Cbn D m W A 4 m LO) C ?I L) e m b ? O C a m E ? `n ? m r $ d O _C b E 9 n ?' a R M O q ? p m U FD b .m p W m ? & u s Q? E? 2 = = O mmv b?= ? c e m ?, b -° E a by E co rya LENTZ-GENGRRO r c 3 e Sg?' Sb,?P _v ? S ii p o ? O, L C ? E L ?f ??F l J § !! 69? q ? YYY???g ]Tye j5j ? yw L y ? w a p 3 c ??i (f 3 6 ? i. O E C e c q ? s o E $° °@ @ 3 ?? 7 C ° w C S Y ma ' E s ?.f oG ? c..i. ' r ?p x ° $ E a ? S u P ? Q ? ry M w' aspp CC f? F? A? e i y ?N w a Z ? ? C ?? g a ?V • ?° ? S ? Gy+pW .$Eg c iC w ? E Do ? o S* JIM.- e e a c O a F? c w D pp •: d ?a y C tl I v C ? ?o ' ?98??r w u e J a „ ° Y 4 5Ee?e=! tai b? f f G ?` . G i e O LL $Sr3 : 5 $?Pa ? 5 u 111 ? ???? o - v = ° 4 fi n g $ 6 973 669 6960 P.39 SEP-07-2004 15:27 LENTZ-GENGRRO 973 669 8960 i i Addendnna B This is an addend= to the Branch Manager P-liVloyumt Agreement beiramn Supetim Mottga8e Corpora on, a ew Jersey Cotporation ("Coc?paey') end Stepben A. Gebba rlt ("Manager") dared 20&L. This addendum becomes punt of the entire Alpesneat It does not cbange, a ea o[ ilify air mg in the originel8raneb Manager ?tployment Agrctmeat. Ana Fees Company for undetwritiA be debited when the loan cost of PideBty Bond and '4 to O oy IcF us.oawF ..............-? - - ubsegncatty closes. This amount is due at time of.mdetwdting and will tS otbwaise at ebe discretion of Compsaiy. This POT loan fee indodes the end omissions las mra. 5290 (or the GebbarA Branch Manages m's rate sheet for detaBs- 7we-.? Data Secretary P.10 ?) Date sZ,5;70 0-)" Dsto SEP-07-2004 15:29 LENTZ-GENGARO 973 669 8960 i ^ I Aeldeadtun C lliis is an addendum to the BYaaeb Maaaga Fatpioyywmen t berwocu Superior Wrap E Corporation, a New )etsey Cmpotatiaa ("CompatlY) and stephea A Gebhatdt Maneper dated ,puss z8, 2D0i Ibis addeodtem onB,nd Branch Manager bemrnes put of the entire A rccumt. h does not ebaugc, aHert or mdlify BOY tddag io ths &npiDyment Apasmeut Cottpary and Manager agree that Manager qualifies for the Brtwn Level looondve' Plan. Conapaoy has relied on information, both verbal and writtEn, provided by Manager to order to mace this deterorination. Manager believes that the information provided aeeurn[ety refleem bath historical production resohe and potential production capabilities. Tait plan provide, fora total incentive in the annum of 530,000, to be broken down end paid out as follows; ' s 515,000 to be applied by Catnpany m tuEUCL Grose Profit Account to oEgaet set ap, startup. and initial operating costs. Manager thirty days serer the branch b. 57,50D as an initial sign on Incentive to be paid by Company to has eaed c. $75 to he paid COM14"lly to MARROW upon aehinviag branch closings in the amount of yeft thed a 518,000,000 withhi lo one yea frDm the date that the Itraaeb opened. Additionally, the following terms and conditions will apply; Y---- quaUcatives under We plan is eoatftltul upon Mmager meeting established p Ee erettdardi and aD tixmc and conditions as ioutmed herein 2. bier et. must be eu?loyad by C-PIDY, Bn_ bi ?0& is order to benefit from aadPor recave payment Df any incennvas oiWttua m this plan. _ 3. sign on IivtihverEfereueed w item a abov ? : ad Incentive the ubtu considered is have item c above are met Ooco'the re*drat>a? is Sip been eamaL If Manager faaa m meat the requbornmig of itam c, or termiuaees nnployinenf for any reason. prior to mtkring the requirements of item S Sign on bwtotive will be repaid by Manager. 4. Set snot tqr, end inidtd opecedus ousts u referencaf in item b above include the costa of int'pat New such as Suteishm'>vz. equipment aid software or other ongoing opQatmg exponsea tau h as payroll (emluctmg pWron of Manager and /or his famly m a ?) W t pufpose of setting up and operating the branch office. 'if ancts arep?c hexed, vscm became the property of Company. In the event of UMW' adm of Maragwt employment for am reason. these assets must be, ratumcd by Manager. at. Manager's expense to a lomtion m 5. CM49UY Las Tc4cd on and wdtten, provided by Manager m rove Plan. If CMrWY subscquentiy jr was sobstandha inhOrmto or misrepresented, ibis Incentive Ytat will he deemed mull and void, at Ctsrrpaay's discretion. r. Sck mil- this event, any amounts paid amda this plan will be m cr edj and must be repaid by ManaFc / V 6. In the event that MI?ager peccmde the stendards established to item e, the following ir+CWnves will apply, negating Company and Manager's obligations as Duftod in item o: g to a paid to Manager after upon achieving bmch closings in the amovnt widdn oat year from @w date that the branch opened; or, ii. 5 to be paid to MrmsZer Fact. upon achieving branch closings in the amorint of s? within one yvar from the date that tlicbraneh opened; or, iii. 5 to be paid to Manager Other on achieving breech closings in e ,e .m 'Iwr wf S _ wihin Dnc year 6om the date that the brunch npened- P.11 TOTAL P.11 CERTIFICATE OF SERVICE. I certify that on September 13, 2004, a copy of the foregoing Preliminary Objections of Defendant Doherty Employment Group, Inc. was served by first class mail, postage prepaid, on the following person: Frank P. Clark, Esq. Clark Law Offices 3045 Market Street, 2nd Floor Camp Hill, PA 17011 Counsel for Plaintiff :3a' Marsh /A IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA STEPHEN A. GEBHARDT, Plaintiff, ' CIVIL ACTION - LAW VS. : Docket No. 04-3895 DOHERTY EMPLOYMENT GROUP, INC., :JURY TRIAL DEMANDED Defendant. ANSWER TO PRELIMINARY OBJECTIONS 1. Admitted. 2. Admitted. Admitted. 4. Admitted. 5. Admitted. Failure to Conform to a Rule of Court (Pa. R.C.P.1028 (a)(2)) 6. The averment is a legal conclusion to which no response is required and is therefore denied. By way of further answer, Plaintiff's claims are based on recovery of wages or compensation from employment, through a theory of breach of contract or the Wage Payment and Collection Law. The averment is a legal conclusion to which no response is required and is therefore denied. 8. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent that a response is required, Plaintiff's compensation from Defendant is based on the monthly net profit realized from the branch office he operated, an established course of dealing between Plaintiff and Defendant that was never reduced to writing, but which as a matter of practice followed section 6 of a written agreement to which Defendant is not a signatory ("Section 6"); while not conceding that Pa. R.C.P. 1019 applies to Section 6, Plaintiff nonetheless attaches and references that portion of that document to this Answer as Exhibit A into Plaintiff's Complaint. 9. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, then while not conceding that Pa. R.C.P. 1019 applies to said Section 6, Plaintiff nonetheless complied by attaching and referencing said Section 6 to his Complaint in paragraph 8, above. 10. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, then while not conceding that Pa. R.C.P. 1019 applies to said Section 6, Plaintiff nonetheless complied by attaching and referencing said Section 6 to his Cornplaint in paragraph 8, above. H. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required the averment is denied, as Plaintiff's compensation from Defendant is based on the monthly net profit realized from the branch office he operated, as per the parties' established course of dealing. 12. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required the averment is denied, as Plaintiff's compensation from Defendant is based on the monthly net profit realized from the branch office he operated, as per the parties' established course of dealing. 13. The averment is a legal conclusion to which no response is required and is therefore denied. Failure to Join Necessary and Indispensable Party (Pa. R.C.P.1028(a)(5)) 14. The averment is a legal conclusion to which no response is required and is therefore denied. 15. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obligated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 16. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obligated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 17. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obligated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 18. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obligated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 19. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obligated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 20. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obligated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 21. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obligated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 22. Admitted. 23. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obligated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 24. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the well-plead facts in the complaint establish that Plaintiff had an employment relationship with Doherty and that Doherty was obl'.igated to perform the employer function, including but not limited to paying Plaintiff his compensation from said employment. 25. The averment is a legal conclusion to which no response is required and is therefore denied. Lack of Subject Matter Jurisdiction (Pa. R.C.P. 1028(a)(1 )) 26. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the action is based on a course of dealing between Doherty and Plaintiff, and Doherty is not a party to the document referenced in its Preliminary Objections. 27. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the action is based on a course of dealing between Doherty and Plaintiff, and Doherty is not a party to the document referenced in its Preliminary Objections. 28. The averment is a legal conclusion to which no response is required and is therefore denied. To the extent an answer is required, the averment is denied, as the action is based on a course of dealing between Doherty and Plaintiff, and Doherty is not a party to the document referenced in its Preliminary Objections. WHEREFORE, Plaintiff respectfully requests that this Honorable Court dismiss the Preliminary Objections in their entirety and direct Defendant to file an Answer to the Complaint. Respectfully submitted, CLARK LAW OFFICE Dated: October 12, 2004 By. Frank P. Clark Attorney I.D. #35443 20 Erford Road, Suite 300A Lemoyne, PA 17043 (717) 731-8600 h. Notwithstanding the foregoing, Manager shall be principally responsible for, and shall have full power and authority in, directing the management and operation of the Branch Office as aforesaid, including, but not limited to, the securing of appropriate space, the hiring, training, and management of employees, marketing and sales activities relating to the Company's mortgage products, and compliance with all applicable requirements of any federal or state laws regarding the origination, solicitation, and closing of mortgage loans and any applicable laws or regulations concerning the Company's products, facilities and business. 6. Compensation. Manager's compensation will be based on the monthly net profit realized from the operation of the Branch Office. The monthly net profit figure will be derived from the balance shown on the Branch Offce'ss monthly "Gross Profit Account" ("GPA"). The GPA is a ledger account that the company maintains as an internal accounting mechanism to track each Branch Office's income and expenses. Standard accounting practises are utilized to establish the monthly GPA balance. Outside of this formula, no other compensation will be paid to the Manager. If the balance of the GPA is a negative figure, no compensation will be due to the Manager for that month. Any negative monthly balance of the GPA will be carried forward to the following month. Adjustments to the GPA are outlined below. a. The Gross Profit Account will be used to record (1) the receipt of all revenue generated by mortgage loans originated through the Branch Office including all application fees, commitment fees, borrower points, all funds paid to the Company by investors including premiums and service release premiums, if any, and all other fees (except third party fees) paid by borrowers and (2) all of the costs, expenses, and debits of operating the office as set forth in subparagraph (b) below. b. The following amounts will be debited from the Gross Profit Account: i. Debits as listed on Addendum "A," Schedule of Basis Point Debits; Loan fees per addendum "B"; ii. An accounting expense allocation equal to $400 per month except that if the Branch Office employs more than 3 employees, such expense allocation will be increased $50 per month per additional employee; Miscellaneous expenses including: 1. All costs and penalties (such as reversal of Servicing Release Premiums) from investors for early payoff of loans that were originated by Branch Office and closed by Company. 2. Costs and fees for extended rate locks regardless of whether or not the loan closes; iv. Any and all compensation to be paid to mortgage solicitors and other personnel working out of the Branch Office, including the costs of benefits and taxes, which compensation, benefits and taxes will! be paid directly by the Company; V. Any monies paid directly by the Company to third parties or to the Manager as reimbursement pursuant to $7 of this Agreement; vi. All licensing and bonding costs as set forth in I 7c below; provided, however, the parties agree that the Company retains the right to change, from time to time, the amounts set forth in subparagraphs i through iv and to establish different pricing for new products, on thirty (30) days written notice to MANAGER. EXHIBIT A c. The parties agree that the Company maintains a minimum balance of $5,000 in the Gross Profit Account. This amount is designed to provide cash flow for the payment of Company approved expenses for the office throughout the month. This balance will be established by debiting the Gross Profit Account in the amount the net revenue from each loan closed until the entire balance is established. The Company retains the right to change, from time to time, the amouuits set forth in this subparagraph on thirty (30) days written notice to Manager. Changes may be based on the number of employees in the branch, volume of closed loans and/or total overhead costs to run the branch. 7. Office Expenses. Although the Company will be responsible for the payment of all expenses, the Manager will be responsible for managing the expenses of the Branch Office. To the extent that any of these expenses are paid directly by the Company or the Company reimburses Manager for such expenses, such expenses will be deducted from the Gross Profit Account as set forth in 16 above. Company will not be responsible for any unauthorized expenses including, but not limited to, travel, employee bonuses, meals, entertainment and employee reimbursements. Branch Office expenses are outlined below: a. Expenses involved in operating the Branch Office include, but are not limited to, rent, utilities, office equipment maintenance and rental, telephones, advertising, worker's compensation insurance, hazard and liability insurance, computer software and services, forms, supplies, facsimile machines, secretarial assistance or employment of service assistance, taxes on subject office, office supply needs (such as business cards, direct mailing supplies, letterhead, special courier service, postage, signs, advertising) and other such expenses, and all necessary fees and expenses of maintaining any professional licenses of a Manager or other employee at the Branch Office, as well as, all expenses relating to loan processing such as credit reporting and appraisals. b. Expenses connected with Branch Office employees utilizing Company authorized automated underwriting systems such as FNMA's Desktop Underwriter or FHLMC's Loan Prospector. These expenses include, but are not limited to, all per loan fees charged by the automated underwriting system vendor, telephone access charges and credit reporting charges. Company will credit the Branch Office's Gross Profit Account for the per loan fee charged by the automated underwriting system vendor for any loan that closes where Company is allocating a commitment fee expense to the Branch Office's Gross Profit Account. C. Any and all contracts, agreements and leases for the various Branch Office vendor relationships must be approved by Company in writing. Any and all contracts, agreements and leases for the Branch Office that are or were entered into by the individual Branch Manager are to be assumed by the Company by written agreement making the Company financially responsible for all payments, as long as, this Agreement remains in effect. Company will only assume responsibility for Company approved vendor relationships. All such costs and payments shall be deducted from the Gross Profits Account as set forth in $6b above. In the event that this Agreement is terminated, Company will no longer be financially responsible for the payments to these vendors. The responsibility of any vendor agreements that Company assumed in consideration of this Agreement will revert back to Manager. d. The Company shall be responsible for the payment of all fees for the Branch Office license and shall obtain and pay for all bonds required by Commonwealth of Pennsylvania Department of Banking for the operation of the Branch Office and the maintenance of individual and corporate licenses. These costs shall be debited from the Gross Profit Account. VERIFICATION The undersigned, Frank P. Clark, of the Clark Law Office hereby certifies that the foregoing Answer to Preliminary Objections has been prepared by me with knowledge and information acquired during the course of my representation of Plaintiff Stephen A. Gebhardt, that I execute this Verification as a signature of Plaintiff, that said Plaintiff's signature cannot be obtained in the time permitted for the filing of said Answer to Preliminary Objections, and that false statements herein are made subject to the penalties of 18 Pa.C.S. Section 4904 relating to unsworn falsification to authorities. Frank P. Clark CERTIFICATE OF SERVICE I, FRANK P. CLARK, do hereby certify that I served a true and correct copy of the foregoing Complaint upon the following below-named parties by hand delivery, today, Ocotber 12, 2004. SERVED UPON: David R. Fine KIRKPATRICK & LOCKHART Payne Shoemaker Building 240 N. Third St. Harrisburg PA 17101-1507 Marsha A. Sajer KIRKPATRICK & LOCKHART Payne Shoemaker Building 240 N. Third St. Harrisburg PA 17101-1507 Frank P. Clark 1 hJ > ?? ?? ? i i i:? I __? _ ?. i _.._ "_7 t i N l J ? . ( ) ? ;?l _., i.7 _ ?.?. {:) ? `rn 1 1 G.'f `J ? J= -ti IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA STEPHEN A. GEBHARDT, CIVIL ACTION - LAW Plaintiff, Docket No. 04-3895 VS. JURY TRIAL DEMANDED DOHERTY EMPLOYMENT GROUP, INC., Defendant. PRAECIPE TO LIST CASE FOR ARGUMENT COURT TO THE PROTHONOTARY OF SAID COURT: Please list Preliminary Objections of Defendant in the above case for Argument Court held November 11, 2004. Name & Address of Plaintiff's Counsel: Name & Address of Defendant's Counsel: Frank P. Clark CLARK LAW OFFICE P.O. Box 1254 Camp Hill, PA 17001-1254 Dated: October 21, 2004 David R. Fine KIRKPATRICK & LOCKHART Payne Shoemaker Building 240 N. Third St. Harrisburg PA 17101-1507 CLARK LAW OFFICE By:??1 Frank P. Clark Attorney I.D. #35443 P.O. Box 1254 Camp Hill, PA 17001-1254 (717)731-8600 Attorney for Plaintiff CERTIFICATE OF SERVICE I, FRANK P. CLARK, do hereby certify that I served a true and correct copy of the foregoing PRAECIPE TO LIST CASE FOR ARGUMENT COURT upon the following below-named parties by depositing the same in the U.S. Mail, postage pre-paid at Camp Hill, Pennsylvania, today, October 21, 2004. SERVED UPON: David R. Fine KIRKPATRICK & LOCKHART Payne Shoemaker Building 240 N. Third St. Harrisburg PA 17101-1507 Frank P. Clark <-. STEPHEN A. GEBHARDT Plaintiff V. DOHERTY EMPLOYMENT GROUP, INC., Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY', PENNSYLVANIA : 04-3895 CIVIL TERM `IN RE: DEFENDANT'S PRELIMINARY OBJECTIONS TO PLAINTIFF'S COMPLAINT Before HOFFER, P.J., OLER, J. and GUIDO, J. ORDER OF COURT AND NOW, November 18, 2004, after hearing oral arguments of counsel, defendant's preliminary objection in the nature of nonjoinder of a necessary party is sustained. No further action may be taken until this objection is cured. By the Court, ?1?rank P. Clark, Esquire PO Box 1254 Camp Hill, PA 17001-1254 For the Plaintiff 17 .David R. Fine, Esquire Kirkpatrick & Lockhart LLP Payne-Shoemaker Building 240 North Third Street Harrisburg, PA 17101 For Defendant r E. Hoffe , P.J. rhn,on? . ? .° F?rye Curtis R. Long Prothonotary (office of the protbonotarp Cumberranb Countp Renee K. Simpson Deputy Prothonotary John E. Slike Solicitor n J; - -.3A9S CIVIL TERM ORDER OF TERMINATION OF COURT CASES AND NOW THIS 5TH DAY OF NOVEMBER 2007 AFTER MAILING NOTICE OF INTENTION TO PROCEED AND RECEIVING NO RESPONSE - THE ABOVE CASE IS HEREBY TERMINATED WITH PREJUDICE IN ACCORDANCE WITH PA R C P 230.2. BY THE COURT, CURTIS R. LONG PROTHONOTARY One Courthouse Square - Carlisle, Pennsylvania 17013 - (717) 240-6195 - Fax (717) 240-6573