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HomeMy WebLinkAbout99-7616 civilSUMMIT MACHINERY SYSTEMS, INC., Plaintiff VS. POLYMER DYNAMICS, INC., Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA 99-7616 CIVIL CIVIL ACTION - LAW IN RE: DEFENDANT'S PRELIMINARY OBJECTIONS TO PLAINTIFF'S AMENDED COMPLAINT BEFORE BAYLEY AND HESS, JJ.. ORDER AND NOW, this day of June, 2000, the preliminary objection of the defendant to the plaintiff' s amended complaint is SUSTAINED. It is ordered and directed that this case be transferred to the County of Lehigh. The costs and fees for transfer and removal of the record shall be paid by the plaintiff. BY THE COURT, Jeffrey L. Rehmeyer II, Esquire 29 North Duke Street York, PA 17401 For the Plaintiff Edward N. Cahn, Esquire Jack M. Seitz, Esquire 1620 Pond Road, Suite 200 Allentown, PA 18104 For the Defendant ess, J. SUMMIT MACHINERY : SYSTEMS, INC., : Plaintiff · : vs. : 99-7616 CIVIL : POLYMER DYNAMICS, INC., : Defendant : CIVIL ACTION- LAW IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA IN RE' DEFENDANT'S PRELIMINARY OBJECTIONS TO PLAINTIFF'S AMENDED COMPLAINT BEFORE BAYLEY AND HESS, JJ. OPINION AND ORDER Before the court is the defendant's preliminary objection challenging venue. The plaintiff alleged a breach of contract arising out of two sales orders. The plaintiff has also alleged damages under theories of promissory estoppel and unjust enrichment. The plaintiff is a Pennsylvania corporation located in Mechanicsburg, Cumberland County, Pennsylvania. The defendant is a Pennsylvania corporation located in Allentown, Lehigh County, Pennsylvania. On or about December 10, 1997, the plaintiff entered into two separate contracts with the defendant in Lehigh County. According to the first contract, sales order ING-23401, the plaintiff was to provide the defendant with an Ingersol EDN machine and accessories for a total price of $1,212,660.00. The second contract, sales order MC-6087, provided that the plaintiff would furnish the defendant with ten Okada machines and accessories for a total price of $5,370,000.00. The plaintiff was able to provide the equipment by virtue of its exclusive regional distributor relationship with MC Machinery Systems Inc. and Okada Company Ltd. 99-7616 CIVIL On June 30, 1999, the defendant entered into a settlement agreement with MC Machinery to cancel the purchase pursuant to ING-23401' On November 8, 1999, the plaintiff sent a letter asking the defendant for adequate assurance that they would be proceeding with the purchase under the second sales order. According to the complaint, the defendant failed to make these assurances and on December 15, 1999, the plaintiff concluded that the defendant had repudiated the second sales order and, thus, breached the contract. Rule 2179 of the Pennsylvania Rules of Civil Procedure governs venue in cases involving corporations. The Rule provides in pertinent part that an action against a corporation may be brought in and only in: (1) the county where its registered office or principle place of business is located; (2) a county where it regularly conducts business; (3) the county where the cause of action arose; or (4) a county where a transaction or occurrence took place out of which the cause of action arose. The plaintiff acknowledges that venue is not proper under paragraphs (1), (2), and (3) above. Thus, the issue before this court is whether the defendant's failure to purchase the ordered machines is a "transaction or occurrence" in Cumberland County. One of the earliest cases construing this Rule was Craig v. W. J. Thiele and Sons, Inc.. 395 Pa. 129, 149 A.2d 35 (1959). There, the plaintiff, owner of a truck dealership in Luzerne County, entered into a contract with a defendant in Cambria County. Pursuant to that agreement, the defendant agreed to sell truck bodies to the plaintiff which bodies were to be placed on trucks which the plaintiff sent to the defendant's plant in Cambria County. The plaintiff brought an 99-7616 CIVIL action seeking damages as a result of poor workmanship in the construction of the truck bodies. In Craig, the issue was Whether the sending of an order for the truck bodies from Luzeme County was a transaction or occurrence out of which a transaction arose for the purpose of laying venue there. The Supreme Court held that it was not. The framers of our rule...intended to require that a transaction (in this case the making of a contract) and not merely some part of the transaction take place in the county where venue is laid. It would lead only to confusion and a practice which we have heretofore referred to as ."forum shopping" if the law were to permit suit to be commenced against a corporation in any county where any facet of a complex transaction occurred. Nor do we understand the "occurrence" to mean "part of a transaction." On familiar principles of ejusden generis, the word "occurrence" would not have a broader meaning than "transaction" so as to conform it to "part of a transaction." Id. at 37. In this case, the plaintiffs argue that the failure to purchase the ordered machines occurred in Cumberland County. Even assuming that a nonevent can constitute a "transaction or occurrence" we do not believe, in this case, that it rises to the level necessary to confer venue pursuant to Rule 2179. It is true that the Pennsylvania Supreme Court has recognized a failure to act as an occurrence. In Burdett Oxygen Co. v. I.R. Wolfe & Sons, Inc., 433 Pa. 291,247 A.2d 299 (1969), a Dauphin County corporation had entered into a contract under which it agreed to purchase all of its requirement for certain gases from Burdett Oxygen Co., a Montgomery County corporation. Burdette brought suit against I.R. Wolfe & Sons because I.R. Wolfe & Sons 99-7616 CIVIL breached the contract when they bought gases from other entities. The defendant filed preliminary objections claiming venue was improper in Montgomery County. The Supreme Court found Montgomery County to be a proper forum. The court held that because it was anticipated that the defendant would obtain all of its gas requirements for a period of ten years from Montgomery County that the defendant was regularly conducting business in Montgomery County within the meaning of Pa.R.C.P. 2179(a)(2). In addition, had the defendant not breached the contract, it would have sent orders to the plaintiff in Montgomery County for goods covered by the contract and the failure to deliver the required orders constituted an "occurrence...out of which the cause of action arose" as contemplated by Pa.R.C.P. 2179(a)(4). The matter sub judice is readily distinguishable. In this case, orders had already been placed. The defendants simply signaled their intention not to accept delivery which was to have occurred in Lehigh County. The defendant corporation is located in a different county than the plaintiff and there is no suggestion that it regularly conducts business here. The plaintiff has failed to allege facts which would support its argument that any aspect of the breach of contract took place in Cumberland County. It is undisputed that the contracts were formed and accepted at the defendant's office in Lehigh County. We agree with the defendant that this case has no connection to Cumberland County other than the fact that the plaintiff' s office is located here. In suggesting that venue is nonetheless proper here, the plaintiff relies on Lucas Enterprises Inc. v. Paul C. Harman Co., Inc., 273 Pa. Super. 422, 417 A.2d 720 (1980). In that case, the Superior Court concluded that Allegheny County, the place of business of the plaintiff, was a proper venue for the case. In Lucas., the breach of contract was the failure to pay a finder's 99-7616 CIVIL fee according to the terms of the contract. The court held that in construing Pennsylvania's venue provision, the rule is that, in the absence of an agreement to the contrary, "payment is due at the plaintiffs' residence or place of business, and venue is proper there in a breach of contract alleging failure to make payment." Id.. at 424-425, 417 A.2d at 721. In the present case, the alleged breach is not a failure to make payment. We are satisfied that Lucas does not apply. ORDER AND NOW, this day of June, 2000, the preliminary objection of the defendant to the plaintiff s amended complaint is SUSTAINED. It is ordered and directed that this case be transferred to the County of Lehigh. The costs and fees for transfer and removal of the record shall be paid by the plaintiff. B Y THE COURT, Jeffrey L. Rehmeyer II, Esquire 29 North Duke Street York, PA 17401 F or the Plaintiff K ess, J. Edward N. Cahn, Esquire Jack M. Seitz, Esquire 1620 Pond Road, Suite 200 Allentown, PA 18104 For the Defendant