The URL can be used to link to this page

Home My WebLink About2004-691 Civil (2) GIUSSEPPE BARONE and : IN THE COURT OF COMMON PLEAS OF LUIGI AMBROSINO, : CUMBERLAND COUNTY, PENNSYLVANIA PLAINTIFFS AND : COUNTERCLAIM DEFENDANTS: : V. : : VINCENZO PUGLIESE, : DEFENDANT AND : COUNTERCLAIM PLAINTIFF : 04-0691 CIVIL TERM IN RE: THE PIZZA CASE OPINION AND ORDER OF COURT Bayley, J., September 10, 2009:-- Based on the analysis in an opinion dated July 13, 2009, we find that defendant breached its Business Purchase Agreement and promissory note entered into with plaintiffs. We will award plaintiffs $105,000 against defendant: $69,000 for the breach of a Business Purchase Agreement, and $36,000 for the breach of a promissory note. Counterclaim plaintiff will be awarded $50,000 against counterclaim defendants for the breach of a restrictive covenant in the Business Purchase Agreement. Defendant pled and sought recovery of attorney fees in its counterclaim against plaintiffs. The Business Purchase Agreement provides: Attorneys’ Fees. In the event that either party breaches this Agreement or any of the obligations or undertakings which form a part of the breaching party shall be obligated to reimburse this Agreement, the non-breaching party for reasonable attorney’s fees and court costs incurred as a result of such breach. (Emphasis added.) In its brief on the issue of the attorney fees claimed by counterclaim plaintiff, plaintiffs argue that because both parties prevailed on their claims they are equally entitled to attorney fees and costs or neither party is entitled to an award of fees and 04-0691 CIVIL TERM costs. Both positions are incorrect. The prevailing party on any claim for breach of the Business Purchase Agreement is entitled contractually to recover attorney fees and court costs “incurred as a result of such breach.” Thus, because defendant has pled and proved it incurred reasonable attorney fees in prevailing on its counterclaim for breach of contract by plaintiffs, he is entitled to recover reasonable attorney fees and court costs incurred as a result of such breach. Plaintiffs, however, did not plead and seek recovery of attorney fees on their claim for breach of contract against defendant. Therefore, they are not in a position to obtain an award of reasonable attorney fees for 1 defendant’s breach of contract. The test for assessing the reasonableness of an attorney’s fee has been stated as follows: [T]he trial court must consider: . . . . the amount of work performed; the character of the services rendered; the difficulty of the problems involved; the importance of the litigation; the amount of money or value of the property in question; the degree of responsibility incurred; whether the fund involved was “created” by the attorney; the professional skill and standing of the attorney in his profession; the results he was able to obtain; the ability of the client to pay a reasonable fee for the services rendered; and, very importantly, the amount of money or the value of the property in question. Estate of Murray v. Love, In re Trust 602 A.2d 366, 370 (Pa. Super. 1992) (quoting Estate of LaRocca, 246 A.2d 337, 339 (Pa. 1968)). __________ 1 Plaintiffs, however, are not precluded from seeking recovery of those attorney fees. They may file a motion requesting such damages not later than ten days after the date DeLage Landen Financial Services, Inc. v. of the order entered in this case. See Rozentsvit, 939 A.2d 915 (Pa. Super. 2007). -2- 04-0691 CIVIL TERM Counterclaim plaintiff introduced evidence of an attorney fee of $124,564.50 and 2 $681.62 in costs. Because the counterclaim plaintiff prevailed only on the counterclaim he can only recover reasonable attorney fees and court costs incurred as a result of the breach by plaintiffs of the restrictive covenant. He cannot recover attorney fees for the defense of the claim of plaintiffs for his breach of contract upon which plaintiffs prevailed. Of the $124,564.50 sought, the following fees must be deducted: (1) $4,454.50 with regard to the sale of the Cumberland Parkway Brother’s Pizza and assignment of the lease related to the space occupied. (2) $13,145 incurred in an attempt to force plaintiffs to assign to defendant the lease to the property upon which the Cumberland Parkway pizza shop was operating. (3) $2,433 for preparing a motion to enjoin the operation of the Rossmoyne restaurant. The motion was never filed and counterclaim plaintiff never prevailed in securing an injunction. These reductions total $20,032.50. That leaves $104,532 in attorney fees for both the prosecution of the counterclaim and in defense of plaintiffs’ claims. Counterclaim defendants maintain that counterclaim plaintiff has not adequately segregated the amount of his attorney fees between the prosecution of the counterclaim and defense of plaintiffs’ claims. They argue that “Because there is no way to separate the attorney fees incurred as a result of Plaintiff’s breach and the __________ 2 The costs included witness fees, court fees, subpoena fees, subpoena service fees -3- 04-0691 CIVIL TERM attorney fees incurred as a result of Defendant’s breach, an attorney fee found reasonable in the category should be split in half.” That would be completely unfair. The bulk of the work in this case was the prosecution of the counterclaim. Defendant breached the Business Purchase Agreement and the promissory note when it failed to make the remainder of the $105,000 payments due under those instruments for which there was little in the way of a defense other than to seek an abatement of that amount as damages for plaintiffs’ breach of the restrictive covenant. We concluded that abatement was not a fair and just remedy. It is fair and reasonable to assign ten percent of the attorney fees toward the defense of plaintiffs’ claims and ninety percent toward the prosecution of the counterclaim. The amount of work performed by counsel in furtherance of the counterclaim was extensive; the character of the services rendered was involved; the difficulty in the problem of proving the breach of the restrictive covenant was involved and it was very difficult to prove damages for the breach; the importance of the litigation was very important to counterclaim plaintiff because he still owed counterclaim defendants $105,000 under the terms of the Business Purchase Agreement and the promissory note; the amount of money and the value of the property in question in the counterclaim was substantial; the degree of responsibility incurred by counsel was significant; a $50,000 fund was created by the attorney notwithstanding that a greater amount was sought; the attorney had a high degree of professional skill and standing in his and fees to an Italian interpreter. -4- 04-0691 CIVIL TERM profession; the results he was able to obtain were significant; the ability of his client to 3 pay the entire reasonable fee for the services rendered was non-existent, and the amount of money and the value of the property in question were substantial. Based on this analysis, we conclude that $94,078.80 ($104,532 less 10%) is a reasonable attorney fee for the prosecution of the counterclaim. We will award counterclaim plaintiff that amount plus $681.62 in documented costs for a total of $94,760.42. Plaintiffs are entitled as a legal right to prejudgment interest at 6% per annum for the amounts owed by defendant for breach of the Business Purchase Agreement and Fernandez v. Levin, promissory note. 519 Pa. 375 (1988). Interest is due for a Id. definite sum in money from the time performance was due. It could not be estimated prior to trial the damages due for breach of the restrictive covenant as they were difficult to determine. In light of all of the circumstances we will in our discretion award prejudgment interest at the rate of 6% per annum on the $50,000 due counterclaim plaintiff from counterclaim defendants for the breach of the restrictive Fernandez, covenant. See citing Restatement Second (of Contract § 354(2) and Comment “(d)).” Six percent interest is calculated for the $69,000 due under the Business Purchase Agreement for the thirty-five unpaid $2,000 a month payments starting in February, 2003, until September, 2009, for a total of $21,475. Six percent interest is calculated for the $36,000 due under the promissory note for the eighteen unpaid __________ 3 Defendant has paid $21,215.65 to his attorney. -5- 04-0691 CIVIL TERM $2,000 a month payments starting in September, 2002, until September, 2009, for a total of $13,590. Six percent interest is calculated for the amount counterclaim defendants owe counterclaim plaintiff on $50,000 as of the breach of the restrictive covenant on February 4, 2003, until September, 2009, for a total of $19,750. For the reasons set forth in this opinion and the opinion dated July 13, 2009, the following order is entered. ORDER OF COURT AND NOW, this day of September, 2009, (1) Giusseppe Barone and Luigi Ambrosino are awarded damages against Vincenzo Pugliese for breach of the Business Purchase Agreement and the promissory note totaling $105,000, plus total prejudgment interest of $35,065, for a total of $140,065. (2) Vincenzo Pugliese is awarded damages against Giusseppe Barone and Luigi Ambrosino for breach of the restrictive covenant in the Business Purchase Agreement of $50,000, plus prejudgment interest of $19,750, plus attorney fees of $94,078.80, plus costs of $681.62, for a total of $164,510.42. By the Court, Edgar B. Bayley, J. Robert E. Kelly, Jr., Esquire -6- 04-0691 CIVIL TERM Lee S. Cohen, Esquire 300 North Second Street th 10 Floor Harrisburg, PA 17101 For Plaintiffs Alan R. Boynton, Jr., Esquire 100 Pine Street P.O. Box 1166 Harrisburg, PA 17108-1166 For Defendant :sal -7- GIUSSEPPE BARONE and : IN THE COURT OF COMMON PLEAS OF LUIGI AMBROSINO, : CUMBERLAND COUNTY, PENNSYLVANIA PLAINTIFFS AND : COUNTERCLAIM DEFENDANTS: : V. : : VINCENZO PUGLIESE, : DEFENDANT AND : COUNTERCLAIM PLAINTIFF : 04-0691 CIVIL TERM IN RE: THE PIZZA CASE ORDER OF COURT AND NOW, this day of September, 2009, (1) Giusseppe Barone and Luigi Ambrosino are awarded damages against Vincenzo Pugliese for breach of the Business Purchase Agreement and the promissory note totaling $105,000, plus total prejudgment interest of $35,065, for a total of $140,065. (2) Vincenzo Pugliese is awarded damages against Giusseppe Barone and Luigi Ambrosino for breach of the restrictive covenant in the Business Purchase Agreement of $50,000, plus prejudgment interest of $19,750, plus attorney fees of $94,078.80, plus costs of $681.62, for a total of $164,510.42. By the Court, Edgar B. Bayley, J. 04-0691 CIVIL TERM Robert E. Kelly, Jr., Esquire Lee S. Cohen, Esquire 300 North Second Street th 10 Floor Harrisburg, PA 17101 For Plaintiffs Alan R. Boynton, Jr., Esquire 100 Pine Street P.O. Box 1166 Harrisburg, PA 17108-1166 For Defendant :sal -2-