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HomeMy WebLinkAbout97-3505 CivilDAVID W. KNAUER, ESQUIRE, and DAVID W. KNAUER, P.C., Plaintiffs Vo RISK ENTERPRISE MANAGEMENT LIMITED a/k/a REM, JAMES R. SCHADEL, ESQUIRE, WEINHEIMER, SCHADLE & HABER, MICHAEL P. O'DAY, ESQUIRE, EDWARD H. SMITH, ESQUIRE, and O'DAY & SMITH, a partnership, Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 97-3505 CIVIL TERM IN RE: PRELIMINARY OBJECTIONS OF DEFENDANTS RISK ENTERPRISE MANAGEMENT LIMITED, AND OF DEFENDANTS JAMES R. SCHADEL. ESQUIRE. WEINHEIMER, SCHADEL & HABER, MICHAEl. P. O'DAY, ESQUIRE, AND O'DAY & SMITH BEFORE HOFFER, P.J. and OLER, J.* ORDER OF COURT AND NOW, this ~'t' day of October, 1998, upon consideration of the preliminary objections of Defendant Risk Enterprise Management Limited, and of Defendants James R. Schadel, Esquire, Weinheimer, Schadel & Haber, Michael P. O'Day, Esquire, and O'Day & Smith, and for the reasons stated in the accompanying opinion, the parties are directed, * Guido, J., did not participate in the consideration or disposition of this case. within 45 days of the date of this order, to file depositions and/or a factual stipulation for .purposes of providing a basis for findings of fact by the court on the issue of venue. Plaintiffs' Motion Pursuant to Pa. R.C.P. 1028(c)(2) for depositions on other issues is denied. BY THE COURT, David W. Knauer, Esq. 411-A East Main Street Mechanicsburg, PA 17055 Attorney for Plaintiffs James R. Schadel, Esq. 602 Law & Finance Building 429 Fourth Avenue Pittsburgh, PA 15219 Attorney for Defendants Schadel, Weinheimer, Schadel & Hafer, O'Day, and O'Day & Smith Timothy J. McMahon, Esq. 100 Pine Street P.O. Box 803 Harrisburg, PA 17108-0803 Attorney for Defendant Risk Enterprise Management Limited :rc DAVID W. KNAUER, ESQUIRE, and DAVID W. KNAUER, P.C., Plaintiffs RISK ENTERPRISE MANAGEMENT LIMITED a/k/a REM, JAMES R. SCHADEL, ESQUIRE, WEINHEIMER, SCHADLE & HABER, MICHAEL P. O'DAY, ESQUIRE, EDWARD H. SMITH, ESQUIRE, and O'DAY & SMITH, a partnership, Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 97-3505 CIVIL TERM IN RE: PRELIMINARY OBJECTIONS OF DEFENDANTS RISK ENTERPRISE MANAGEMENT LIMITED. AND OF DEFENDANTS JAMES R. SCHADEL. ESQUIRE. WEINHEIMER. SCHADEL & HABER. MICHAEL P. O'DAY, ESQUIRE. AND 0'DAY & SMITH BEFORE HOFFER, P.J. and OLER, J.~ OPINION and ORDER OF COURT Oler, J., October , 1998. This is a civil action for abuse of process, intentional infliction of emotional distress, wrongful use of civil proceedings, and civil conspiracy. Briefly stated, Plaintiff David W. Knauer, Esquire, complains that he was wrongfully joined as an additional defendant in an action which he had filed on behalf of a client in. another county. Guido, J., did not participate in the consideration or disposition of this case. NO. 97-3505 CIVIL TERM Presently before the court are two sets of preliminary objections to Plaintiffs' third amended complaint. Defendant Risk Management Limited has filed preliminary objections consisting of demurrers. Defendants. James R. Schadel, Esquire, Weinheimer, Schadel & Haber, Michael P. O'Day, and O'Day & Smith have filed preliminary objections consisting, inter alia, of a motion to strike based upon the statute of limitations, demurrers and a challenge to venue. The latter set of preliminary objections was not endorsed with a notice to plead, and the answer filed by Plaintiffs is, in general, unspecific. For the reasons stated in this opinion, the parties will be directed to conduct depositions and/or submit a stipulation for purposes of providing a record upon which the issue of venue may be decided. STATEMENT OF FACTS This case, commenced on December 30, 1997, arises out of the allegedly wrongful joinder of Plaintiff David W. Knauer, Esquire, as an additional defendant in a case in Indiana County. In that case, PlaintiffKnauer had filed suit on behalf ora client for legal malpractice in the handling ora third case. In the third case, the client had purportedly been inadequately represented on a workers' compensation claim. The facts alleged in, or inferable from, Plaintiffs' third amended complaint may be 2 NO. 97-3505 CIVIL TERM summarized as follows:2 Plaintiffs are David W. Knauer, Esq., a practicing Pennsylvania attorney, and David W. Knauer, P.C., his employer. The law office is located in Mechanicsburg, Cumberland County, Pennsylvania. Defendants are Risk Enterprise Management Limited, also known as REM, a foreign corporation doing business under the laws of the Commonwealth of Pennsylvania, with an address of 59 Maiden Lane, New York, New York; James R. Schadel, Esquire, an adult individual with a business address of Weinheimer, Schadel & Haber, 806 Law and Finance Building, 429 Fourth Avenue, Pittsburgh, Allegheny County, Pennsylvania; Weinheimer, Schadel & Haber, a corporation organized and doing business under the laws of the Commonwealth of Pennsylvania, with an address of 8056 Law and Finance Building, 429 Fourth Avenue, Pittsburgh, Allegheny County, Pennsylvania; Michael P. O'Day, Esquire, an adult individual with a business address of O'Day Law Associates, 158 East Chestnut Street, Lancaster, Lancaster County, Pennsylvania; and Edward H. Smith, Esq., an adult individual with an address of Box 534 Maytown, Lancaster County, Pennsylvania. The partnership of O'Day & Smith is also named as a Defendant. The case sub judice finds its genesis in a workers' compensation case wherein Defendants O'Day and O'Day & Smith represented the claimant. The claimant's case was 2 The recitation of these allegations is not intended to suggest a view by the court as to their accuracy. NO. 97-3505 CIVIL TERM based on the following allegations: On September 9, 1983, the claimant, Fred F. Schleicher, suffered an injury while at work. Mr. Schleicher retained Defendants O'Day and O'Day & Smith to represent him in a claim against his employer. At that time, Mr. Schleicher was under the impression that his employer was a company named Great Northeastern Trucking, Inc. (Great Northeastem). Mr. Schleicher prevailed in his workers' compensation claim against Great Northeastern; however, Great Northeastern was insolvent and carried no workers' compensation insurance for Mr. Schleicher. Judgment on the award against Great Northeastern was entered in Lancaster County, Pennsylvania, but it was never satisfied. Falcon Transport, Inc. (Falcon), was allegedly the proper employer against whom a claim should have been filed. Falcon had insured Mr. Schleicher with United States Fidelity and Guaranty Insurance Company (USF&G). Eventually, Mr. Schleicher learned that the identity of the purportedly proper defendants in his workers' compensation case were Falcon and USF&G. Mr. Schleicher then contacted Jay I. Rubin, Esquire, an Indiana County attorney, who, on August 23, 1986, informed Timothy A. Lanza, Esquire, an attorney with Defendant O'Day & Smith, of the identity of Falcon and USF&G. The statute of limitations respecting the workers' compensation claim was to expire 17 days later, on September 9, 1986. However, Defendants O'Day and O'Day & Smith did nothing to pursue Mr. Schleicher's claim against Falcon and USF&G. 4 NO. 97-3505 CIVIL TERM At 3:00 p.m., on September 9, 1986, Plaintiff Knauer met with Mr. Schleicher to discuss his workers' compensation claim. Mr. Schleicher arrived at Plaintiff's office without his workers' compensation file, and Plaintiff Knauer sent Mr. Schleicher to retrieve said file from the offices ofO'Day & Smith. Mr. Schleicher returned to Plaintiff's office on the same day, after the Bureau of Workmen's Compensation office had closed. On September 10, 1986, Plaintiff Knauer filed a workers' compensation claim against Falcon and USF&G on behalf of Mr. Schleicher.3 On September 12, 1986, Plaintiff commenced a professional negligence action against Lanza, O'Day, Smith and O'Day & Smith by filing a praecipe for writ of summons in Indiana County. The basis for the suit was the defendants' alleged negligence in allowing the statute of limitations to expire without filing a claim. The defendants in that action filed preliminary objections alleging that Plaintiff Knauer was the party responsible for missing the deadline. These preliminary objections were denied. On October 23, 1993, Defendants joined Knauer as an additional defendant in the Indiana County case. On December 15 and 16, 1994, PlaintiffKnauer was deposed in the case at his office at 411-A East Main Street, Mechanicsburg, Cumberland County, Pennsylvania. On February 2, 1995, a rule was issued upon the defendants to file a 3 This claim was ultimately denied because the claim was filed one day after the expiration of the applicable statute of limitations. NO. 97-3505 CIVIL TERM complaint in the Indiana County case. The defendants discontinued the joinder in lieu of filing a complaint. Plaintiff then commenced the instant action. Plaintiffs' third amended complaint advances the following causes of action by Plaintiff Knauer: (1) abuse of process for the initiation of the j oinder in the Indiana County action, against Defendant REM: (2) abuse of process for the continuation ofjoinder, against Defendant REM; (3) abuse of process for the initiation ofjoinder, against Defendant James R. Schadel, Esquire; (4) abuse of process for the continuation ofjoinder, against Defendant James R. Schadel, Esquire; (5) abuse of process for the initiation of joinder, against Defendant O'Day; (6) abuse of process for the continuation ofjoinder, against Defendant O'Day; (7) intentional infliction of emotional distress, against Defendant REM; (8) intentional infliction of emotional distress, against Defendant James R. Schadel; (9) intentional infliction of emotional distress, against Defendant O'Day; (10) wrongful use of civil proceedings in initiating joinder, against Defendant REM; (11) wrongful use of civil proceedings in initiating joinder, against Defendant Schadel; (12) wrongful use of civil proceedings in initiating joinder, against Defendant O'Day; (13) wrongful use of civil proceedings in continuing joinder, against Defendant REM; (14) wrongful use of civil proceedings in continuing joinder, against Defendant Schadel; and (15) wrongful use of civil proceedings in continuing joinder, against Defendant O'Day. NO. 97-3505 CIVIL TERM The third amended complaint asserts the following causes of action by Plaintiff David W. Knauer, P.C.: (1) abuse of process, wrongful initiation of joinder and wrongful continuation ofjoinder, against Defendant REM; (2) abuse of process, wrongful initiation ofjoinder and wrongful continuation ofjoinder, against Defendant Schadel; and (3) abuse of process, wrongful initiation of joinder and wrongful continuation of joinder, against Defendant O'Day. In addition, the third amended complaint sets forth causes of action by Plaintiffs Knauer and David W. Knauer, P.C., against Defendant O'Day & Smith for (1) abuse of process, (2) wrongful initiation ofjoinder, and (3) wrongful continuation ofjoinder. Finally, the third amended complaint asserts a cause of action by Plaintiff Knauer against Defendants REM, Schadel, Weinheimer, Schadel & Haber and O'Day, for civil conspiracy. The third amended complaint makes the following allegations tending to support the propriety of venue in Cumberland County: (a) The Sheriff of Indiana County deputized the Sheriff of Cumberland County who served the Plaintiff with the writ of summons joining him as an Additional Defendant in Schleicher at his office at 411-A East Main Street, Mechanicsburg, Cumberland County, Pennsylvania; (b) Correspondence was received and/or sent from the Plaintiff's business address in Mechanicsburg, Pennsylvania. (c) Telephone calls were made to and from the Plaintiff's business address in Mechanicsburg, Pennsylvania; NO. 97-3505 CIVIL TERM (d) The depositions held on December 15-16, 1994, including the Plaintiff' s were taken at the Plaintiff's office in Mechanicsburg, Pennsylvania; (e) Pleadings and briefs were received and/or sent from the Plaintiffs' business address in Mechanicsburg, Pennsylvania; (f) The Defendant O'Day's perjury and/or false swearing occurred in his deposition taken at the Plaintiff's office in Mechanicsburg, Pennsylvania; and (g) The Defendant Schadel misrepresented to the Plaintiff at his office in Mechanicsburg, Pennsylvania, that the Defendant Smith could not be located and, therefore, no deposition of the Defendant Smith could be taken. On June 3, 1998, Defendants Schadel, Weinheimer, Schadel & Haber, Michael P. O'Day, Esquire, and O'Day & Smith filed preliminary objections to the third amended complaint asserting, inter alia, that venue was improper in Cumberland County.4 This portion of the preliminary objections includes the following paragraphs: 30. Pennsylvania Rules of Civil Procedure, Rule 1006(a) provides that an action against an individual may be brought in and only in a county in which that individual may be served or in which the cause of action arose or where a transaction or occurrence took place out of which the cause of action arose. 31. All the facts plead[ed] in the Complaint occurred in connection with the legal malpractice action filed in Indiana County. 4 Defendant REM filed preliminary objections to the third amended complaint on June 4, 1998, but did not object to venue. An objection to venue may be waived by a defendant. See Pa. R.C.P. 1006(e). However, such a waiver by one defendant is not dispositive of the issue of venue when properly raised by another defendant. See Pension v. Lower Bucks Hospital, 395 Pa. Super. 480, 482, 577 A.d. 644, 645 (1990) (holding that one defendant's failure to object to venue does not thereby make venue proper). NO. 97-3505 CIVIL TERM 32. In a professional liability action for failure to bring suit, the cause of action arose in the county where the attorney failed to bring suit. McCormick v. Duffy, 59 D & C.2d [528] (C.P. Delaware 1972). Therefore, in a professional liability claim for bringing suit, the cause of action should be held to arise where the suit was brought. 33. Therefore, the cause of action arose in Indiana County. 34. The defendant James R. Schadel is an individual who can be served in Allegheny County and not in Cumberland County. 35. The defendant Michael P. O'Day is an individual who can be served in Lancaster County and not in Cumberland County. 36. None of the defendants maintain a residence or place of business in Cumberland County. 37. The defendant, Weinheimer, Schadel & Haber, P.C., is a professional corporation which regularly conducts business in and can be served in Allegheny County and not in Cumberland County. 38. The defendant, O'Day and Smith, is a partnership which regularly conducts business in and can be served in Lancaster County and not in Cumberland County. 39. Accordingly, venue in Cumberland County is improper and this court should dismiss this action or in the alternative transfer it to Allegheny, Lancaster or Indiana County. The answer of Plaintiffs to Defendants' preliminary objections (a) "denie[s] as alleged" paragraphs 18-102 in the preliminary objections, (b) "incorporate[s] by reference" Plaintiff's third amended complaint, which "speaks for itself," and (c) "reserve[s] the right to supplement" the answer. No depositions have been filed with respect to the issue of 9 NO. 97-3505 CIVIL TERM venue. DISCUSSION Principles pertinent to the issue of proper venue in this case are set forth in the following Rules of Civil Procedure: RULE 1006. VENUE. CHANGE OF VENUE a) Except as otherwise provided by Subdivisions (b) and (c) of this rule, an action against an individual may be brought in and only in a county in which he may be served or in which the cause of action arose or where a transaction or occurrence took place out of which the cause of action arose or in any other county authorized by law. (b) Actions against the following defendants, except as otherwise provided in Subdivision (c), may be brought in and only in the counties designated by the following rules: political subdivisions, Rule 2103; partnerships, Rule 2130; unincorporated associations, Rule 2156; corporations and similar entities, Rule 2179. (c) An action to enforce a joint or joint and several liability against two or more defendants, except actions in which the Commonwealth is a party defendant, may be brought against all defendants in any county in which the venue may be laid against any one of the defendants under the general rules of Subdivisions (a) or (b). (e) Improper venue shall be raised by preliminary objection and if not so raised shall be waived. If a preliminary objection to venue is sustained and there is a county of proper venue within the State the action shall not be dismissed but shall be transferred to the appropriate court of that county. The costs and fees for transfer and removal of the record shall be paid by the plaintiff. 10 NO. 97-3505 CIVIL TERM (f) If the plaintiff states more than one cause of action against the same defendant in the complaint pursuant to Rule 1020(a), the action may be brought in any county in which any one of the individual causes of action might have been brought. RULE 2130. VENUE (a) Except as otherwise provided by subdivision (c) of this rule, an action against a partnership may be brought in and only in a county where the partnership regularly conducts business, or in the county where the cause of action arose or in a county where a transaction or occurrence took place out of which the cause of action arose. 2179. VENUE (a) Except as otherwise provided by an Act of Assembly or by subdivision (b) of this rule, a personal action against a corporation or similar entity may be brought in and only in (1) the county where its registered office or principal 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. "Rule 1028 specifically provides that, '[if an issue of fact is raised [in preliminary objections], the court shall consider evidence by depositions of otherwise.'" Gale v. Mercy Catholic Medical Center Eastwick, Inc., FitzgeraM Mercy Division, 698 A.2d. 647, 651 (Pa. 11 NO. 97-3505 CIVIL TERM Super. Ct. 1997), quoting Pa. R.C.P. 1028(c)(2). When a court is dealing with an issue of venue, "each case rests on its own facts." Purcell v. Bryn Mawr Hospital, 525 Pa. 237, 246, 579 A.2d. 1282, 1286 (1990). In the present case, Defendants' preliminary objection based upon improper venue is not frivolous, and should be resolved prior to a review in the ultimately-determined forum of more substantive issues raised in other preliminary objections. However, the resolution of the question of proper venue will be facilitated by depositions and/or a stipulation which will place the court in a position to make findings as to the facts which the parties deem pertinent to the issue. Accordingly, the following order will be entered: ORDER OF COURT AND NOW, this 1st day of October, 1998, upon consideration of the preliminary objections of Defendant Risk Enterprise Management Limited, and of Defendants James R. Schadel, Esquire, Weinheimer, Schadel & Haber, Michael P. O'Day, Esquire, and O'Day & Smith, and for the reasons stated in the accompanying opinion, the parties are directed, within 45 days of the date of this order, to file depositions and/or a factual stipulation for 0purposes of providing a basis for findings of fact by the court on the issue of venue. Plaintiffs' Motion Pursuant to Pa. R.C.P. 1028(c)(2) for depositions on other issues 12 NO. 97-3505 CIVIL TERM is denied. BY THE COURT, s/J. Wesley Oler, Jr. J. Wesley Oler, Jr., J. David W. Knauer, Esq. 411-A East Main Street Mechanicsburg, PA 17055 Attorney for Plaintiffs James R. Schadel, Esq. 602 Law & Finance Building 429 Fourth Avenue Pittsburgh, PA 15219 Attorney for Defendants Schadel, Weinheimer, Schadel & Haler, O'Day, and O'Day & Smith Timothy J. McMahon, Esq. 100 Pine Street P.O. Box 803 Harrisburg, PA 17108-0803 Attorney for Defendant Risk Enterprise Management Limited :rc 13