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HomeMy WebLinkAbout2010-7630 K.I.S. TRANSPORT, LLC : IN THE COURT OF COMMON PLEAS OF Plaintiff, : CUMBERLAND COUNTY, PENNSYLVANIA : v. : NO. 10-7630 : PITTSBURGH POWER, INC. and : CIVIL ACTION - LAW BRUCE MALLISON : Defendants. : JURY TRIAL DEMANDED IN RE: DEFENDANT’S PRELIMINARY OBJECTIONS AND PETITION TO TRANSFER VENUE FOR REASONS OF FORUM NONCONVENIENS OPINION and ORDER Defendants Pittsburgh Power, Inc. and Bruce Mallison have filed preliminary objections to Plaintiff’s Complaint pursuant to Pa.R.Civ.P. 1028(a) and a Petition to Transfer Venue for Reasons of Forum Nonconveniens. (Defendants’ Preliminary Objections to the Plaintiff’s Complaint, filed Mar. 30, 2011) (Petition to Transfer Venue for Reasons of Forum Nonconveniens, filed Aug. 8, 2011). Plaintiff’s Complaint was filed in Cumberland County and arises out of certain repairs allegedly performed by Defendant Pittsburgh Power, Inc. on a truck owned and operated by Plaintiff. Plaintiff’s complaint contains three counts: breach of contract, misrepresentation, and negligence. (Complaint, filed Dec. 13, 2010). The Complaint has been preliminarily objected to in the form of an assertion of improper venue, and a petition seeks the transfer of venue for reasons of forum non conveniens. Specifically, Defendants contend that venue is proper in Butler County, and not in Cumberland County. The facts of this case may be summarized as follows. Plaintiff is a Pennsylvania limited liability company with a principal place of business located in Camp Hill, Cumberland County, Pennsylvania. (Complaint, ¶ 1). Keith A. Atland is the sole member of K.I.S. Transport, LLC and is the driver of a 2004 Kenworth W900L owned by Plaintiff and leased to Shumaker Trucking Co. of Dillsburg, Cumberland County, Pennsylvania. (Complaint, ¶¶ 4-5). Defendant is Pittsburgh Power, Inc., a Pennsylvania corporation with a principal place of business located in Saxonburg, Butler County, Pennsylvania. (Complaint, ¶ 2). Defendant Bruce Mallison is an individual employed by Pittsburgh Power, Inc. and has a business office located in Saxonburg, Butler County, Pennsylvania. (Complaint, ¶ 3). Defendant Pittsburgh Power is engaged in the business of repairing, rebuilding, maintaining, and working on diesel engines and truck tractors. (Complaint, ¶ 6). Plaintiff avers that in the fall of 2009, the engine on its 2004 Kenworth truck had blown out and was in need of repair. (Complaint, ¶ 8). As a result, Plaintiff initially took the truck to Cleveland Brothers, a business located in Dauphin County, Pennsylvania, where it was learned that the engine and transmission could be rebuilt at a cost of approximately $30,000.00. (Complaint, ¶¶ 9-10). Plaintiff avers that despite the opportunity to have the truck repaired more locally in Dauphin County, on or about November 27, 2009 Atland first called Defendant Mallinson of Pittsburgh Power to discuss an engine rebuild of the 2004 Kenworth truck at the Pittsburgh Power facility. (Complaint, ¶ 11). An evidentiary hearing on the matter sub judice was held on August, 19, 2011, and the record was augmented with the testimony of Bruce Mallinson and Keith Atland concerning the details surrounding the formation of a contract between the parties. The hearing indicates that Atland first called Defendant Mallinson in late November, 2009. (Notes of Testimony, 5, Hearing, In Re: Defendants’ Petition to Transfer Venue, Aug. 19, 2011 (hereinafter N.T. __)). At that time, Atland introduced himself, explained that his truck’s engine had blown, and indicated that the engine was in need of a rebuild. (N.T. 5, 18, 19). Atland explained that he owned an MBN Caterpiller and that it was located in the Harrisburg area. (N.T. 5). Atland explained the needed repairs, and Defendant Mallinson informed Atland that, while it would 2 prove to be the largest job they had ever done, it was feasible for the required repairs to be done by Pittsburgh Power. (N.T. 6-7, 37). Defendant Mallinson responded that a $5,000.00 deposit would be required in order for him to “get started” on the work. (N.T. 5). A second telephone conversation took place on or about November 30, 2009, and the parties discussed certain details of the work to be done, such as whether Plaintiff could supply certain parts for the rebuild and certain transmission work which needed to be done. (N.T. 6, 19, 35). In this second phone conversation, Defendant again indicated that he would require the receipt of a $5,000.00 deposit to begin the work. (N.T. 19). Finally, a meeting was held on December 7, 2009 at Defendant’s Pittsburgh Power facility, in which the parties continued to negotiate and discuss additional terms and services to be performed. (N.T. 30). The parties testified that the meeting lasted approximately two hours, and they negotiated over details and specifications which had not been yet been decided upon. (N.T. 30, 36). Plaintiff avers in its Complaint that Defendant completed the work on the 2004 Kenworth truck on or about January 20, 2010, and that the work took much longer than had originally been anticipated. (Complaint, ¶ 19). Plaintiff’s Complaint alleges that, after the work was completed and the truck returned to Plaintiff, the truck has had numerous problems and needed frequent repairs, including, but not limited to, the following: the truck would not start properly and it was determined that the battery cables were not properly connected; the clutch slipped and continues to slip; the battery was destroyed through improper wiring; the oil has continued to leak; certain valves were out of adjustment; and the power steering pump was not properly installed and continued to leak. (Complaint, ¶ 22). For these and other alleged repairs, Plaintiff now seeks damages. 3 In a personal action against a corporation or similar entity, venue is governed by Pennsylvania Rule of Civil Procedure 2179, which provides, in pertinent part, as follows: (a) Except as otherwise provided . . . 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; (4) a county where a transaction or occurrence took place out of which the cause of action arose, or (5) a county where the property or a part of the property which is the subject matter of the action is located provided that equitable relief is sought with respect to the property. Pa.R.Civ.P. 2179(a). Similarly, Pennsylvania Rule of Civil Procedure 1006 governs venue in actions against an individual, and provides that venue is proper in and only in a county in which: (1) the 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 or in any other county authorized by law, or (2) the property or a part of the property which is the subject matter of the action is located provided that equitable relief is sought with respect to the property. Pa.R.Civ.P. 1006(a). There is a relatively small body of case law on the issue of where venue lies in a contract action where the plaintiff complains of inadequate performance. What is clear, however, is that our Superior Court has consistently turned to Craig v. W.J. Thiele & Sons, Inc., 395 Pa. 129, 149 A.2d 35 (1959), to interpret the “transaction or occurrence” language of Pa.R.Civ.P. 2179 and 1006. The Superior Court has explained Thiele as follows: Under both rules, Pennsylvania courts have interpreted “a transaction or occurrence” to “require that a transaction ... and not merely some part of the 4 transaction, take place in the county where venue is laid [because] [i]t 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 [defendant] in any county where any facet of a complex transaction occurred.” Craig v. W.J. Thiele & Sons, Inc., 395 Pa. 129, 149 A.2d 35, 37 (1959). See also Pa.R.C.P. 1006(a) Note (referencing Thiele for a definition of a transaction or occurrence). Therefore, “parties cannot avoid the ‘transaction’ requirement by characterizing ‘a part of a transaction’ as an ‘occurrence.’” Sunderland v. R.A. Barlow Homebuilders, 791 A.2d 384, 392 (Pa.Super.2002). Deyarmin v. Consolidated Rail Corp., 2007 PA Super 218, ¶ 18, 931 A.2d 1, 10-11. Thus, the Supreme Court required that the transaction, and not merely some part of the transaction, take place in the county where venue is laid. Id. Thiele involved an action based on a contract for the purchase of truck bodies, and the Supreme Court held that venue did not lie in the county where the purchaser had placed the order for the goods, in the absence of any averment that the contract itself was made in that county; rather the Court held that venue was proper where the contract was formed, as formation constituted a “transaction or occurrence” sufficient to invoke venue. Thiele, 395 Pa. at 132-33; see also Telstar Corp. v. Berman, 281 Pa.Super. 443, 450, 422 A.2d 551, 555, (1980). In a contract action, therefore, it is the situs of contract formation that is a transaction or occurrence that will invoke proper venue under the Pennsylvania Rules of Civil Procedure. Telstar, 281 Pa.Super. at 450 (citing Thiele, 395 Pa. at 129). In attempting to determine the situs of contract formation, the transaction or occurrence language of the Rules of Civil Procedure “does not include the performance of any act in the contract formation process but is the ultimate formation of the contract itself.” Pennsylvania Higher Ed. Assistance Agency v. Devore, 267 Pa.Super. 74, 77, 406 A.2d 343, 344 (1979). Because the situs of the contract is a fact-sensitive issue, it is appropriate for the trial court to take testimony prior to ruling on preliminary objections. Telstar Corp., 281 Pa.Super. at 450; Pa.R.Civ.P. 1028(c). Additionally, for purposes 5 of preliminary objections a court need not accept as true conclusions of law, unwarranted inferences, allegations, or expressions of opinion. Bayada Nurses, Inc. v. Com., Dept. of Labor and Industry, 607 Pa. 527, 558, 8 A.3d 866, 884 (2010); Pa.R.Civ.P. 1028(a)(4). The question of whether a certain set of facts establishes the formation of a contract is a matter of law. Temple Univ. Hosp., Inc. v. Healthcare Mgmt. Alternatives, Inc., 2000 PA Super 387, ¶ 18, 764 A.2d 587, 593. As a result, a trial court is not bound to accept as true averments contained within a complaint which allege the existence or formation of a contract merely because the plaintiff has asserted the presence of such. Here, questions arise concerning where a contract has been formed when multiple counties are involved and where the parties have communicated by telephone or other electronic means. Thiele is again instructive on this point, holding that “the place of making a contract is not where the offer is made but where it is accepted.” Thiele, 395 Pa. at 133 (citing Restatement: Contracts, §74; Linn v. Employers Reinsurance Corporation, 392 Pa. 58, 139 A.2d 638 (1958)); see also Lucas Enterprises, Inc. v. Paul C. Harmon Co., Inc., 273 Pa.Super. 422, 424, 417 A.2d 720, 721 (1980) (“The making of a contract, which takes place where the offer is accepted, undoubtedly constitutes a ‘transaction or occurrence’ sufficient to establish venue.”). The following principles of contract law and formation are well-settled within the Commonwealth: In order to form a contract, there must be an offer, acceptance, and consideration or mutual meeting of the minds. An alleged acceptance of an offer is not unconditional and, therefore, is not an acceptance if it materially alters the terms of the offer. As such, a reply which purports to accept an offer, but instead changes the terms of the offer, is not an acceptance, but, rather, is a counter-offer, which has the effect of terminating the original offer. Further, it is well established that the acceptance of any offer or counter-offer must be unconditional and absolute. 6 Yarnall v. Almy, 703 A.2d 535, 539 (Pa. Super. 1997) (internal citations and quotation marks omitted). The Pennsylvania Supreme Court has held that where a contract is formed over the telephone, the “contract is created at the place where the acceptor speaks.” Linn v. Employers Reinsurance Corporation, 392 Pa. 58, 62, 139 A.2d 638, 640 (1958) Additionally, Section 74 of the Restatement of Contracts, adopted by the Pennsylvania Supreme Court in Thiele, supra, provides that “a contract is made at the time when the last act necessary for its formation is done, and at the place where that final act is done.” Restatement: Contracts, §74. Often, this “last act” is the unconditional acceptance of the offer; however, and as noted above, a statement or action which purports to be an acceptance, but instead changes the terms of the offer, is not an acceptance, but rather is a counter-offer which, by its very definition, cannot be the “last act” necessary for formation. In the matter sub judice, venue is proper in the county in which the contract was formed between Bruce Mallinson and Keith Atland on behalf of their respective companies. We are satisfied that their contract was formed in Butler County, rather than Cumberland County; as a result, venue lies properly in Butler County. The testimony adduced at the hearing indicates that in the fall of 2009 Atland first called Defendant Mallinson of Pittsburgh Power to discuss an engine rebuild of the 2004 Kenworth truck at the Pittsburgh Power facility. (N.T. 5; Complaint, ¶ 11). Defendant testified as follows: Q: When was the date of the first communication between you and Mr. Atland, either the exact date if you know it or an approximation? A: Approximately the week before Thanksgiving of 2009. Q: And what type of communication was that? 7 A: Keith called me and asked me - - Q: Was it a telephone call? A: Yes. A telephone call. Q: And what did Mr. Atland say to you in that call? A: He has an MBN Caterpillar or bridge engine. He wanted to convert it to a 6NZ, and could we do that. And I said yes. (N.T. 5) (emphasis added). Indeed, Plaintiff testified consistently with this understanding as well. At the hearing, Plaintiff testified as follows: Q: Keith, you heard Mr. Mallinson’s testimony. Can you explain for the court in your own words how the agreement between you and him came about? th A: The agreement between him and I came about on November 27 of 2009. I called him from my home in Camp Hill, and we talked extensively. I introduced myself and the situation that my engine had blown up and I needed a rebuild. And I asked him if he could do that. And he said that he would. (N.T. 18-19). At the hearing, there was additional testimony that the acceptance, and thus formation, was conditioned on the receipt of a $5,000.00 deposit by Defendant Mallinson. Defendant testified that during the initial phone conversation the following was discussed: Q: And what did you [Defendant Mallinson] say to [Plaintiff]? A: I said that I would need a check for a $5,000.00 deposit to get [the work] started. (N.T. 5). Plaintiff also testified consistently with Defendant’s understanding of the initial phone conversation. He testified as follows: 8 Q: Mr. Atland, you do agree that Mr. Mallinson said that he could not begin the work on your truck until he received a $5,000.00 payment? A: Yes. Q: And how did you make this credit card payment? Was it over the phone with someone at Mr. Mallinson’s facility, or how was it done? A: It was over the phone from my home in Cumberland County. I gave them by st credit card information on December the 1. (N.T. 28). Whether the contract between the parties was formed over the telephone during the initial phone call by Defendant’s verbal acceptance, or whether the contract was formed when Defendant received the $5,000.00 deposit, we find that both transactions or occurrences occurred in Butler County. When Defendant gave his verbal acceptance and when he received the $5,000.00 deposit he was situated in Butler County. Thus, the contract was formed in Butler, rather than in Cumberland County. In addition, the phone calls between the parties may be viewed merely as preliminary negotiations between them. The phone calls led to the scheduling of a meeting, held December 7, 2009, at Defendant’s Pittsburgh Power facility. There the parties continued to negotiate and discuss additional terms and services to be performed. (N.T. 30). The meeting lasted approximately two hours, and the two negotiated over details or specifications which had not been yet been decided upon. (N.T. 30, 36). By the conclusion of this meeting, Defendant had already received the $5,000.00 deposit (received December 1, 2009), the truck had been transported to Defendant’s facility (towed on December 1, 2009), and the final terms of the agreement had been agreed upon. Clearly, the agreement between the parties was finalized at Defendant’s Pittsburgh Power facility located in Butler County. It was there, in other words, that the contract was formed. 9 Defendants have also raised by petition a claim of forum non conveniens; however, in light of the foregoing we need not address the issue herein as venue is proper in Butler County under the Pennsylvania Rules of Civil Procedure. Additionally, we do not address Defendants’ second preliminary objection, which seeks to bar certain claims under the gist of the action doctrine, as a trial court is without further authority to decide any remaining preliminary objections when that court has granted a change of venue through preliminary objections. Bradley v. O'Donoghue, 823 A.2d 1038, 1042 (Pa. Cmwlth. 2003). For the foregoing reasons, the Preliminary Objection of Defendants pertaining to venue will be granted, and the following order will be entered: ORDER th AND NOW, this 4 day of November, 2011, upon consideration of Defendants’ Preliminary Objections, the response filed thereto, and after an evidentiary hearing held on August 19, 2011, Defendants’ Preliminary Objection to venue is hereby SUSTAINED and the case is transferred to the Court of Common Pleas of Butler County. The costs of transfer are to be paid by the Plaintiff. BY THE COURT, ___________________________ Kevin A. Hess, P.J. 10 K.I.S. TRANSPORT, LLC : IN THE COURT OF COMMON PLEAS OF Plaintiff, : CUMBERLAND COUNTY, PENNSYLVANIA : v. : NO. 10-7630 : PITTSBURGH POWER, INC. and : CIVIL ACTION - LAW BRUCE MALLISON : Defendants. : JURY TRIAL DEMANDED IN RE: DEFENDANT’S PRELIMINARY OBJECTIONS AND PETITION TO TRANSFER VENUE FOR REASONS OF FORUM NONCONVENIENS ORDER th AND NOW, this 4 day of November, 2011, upon consideration of Defendants’ Preliminary Objections, the response filed thereto, and after an evidentiary hearing held on August 19, 2011, Defendants’ Preliminary Objection to venue is hereby SUSTAINED and the case is transferred to the Court of Common Pleas of Butler County. The costs of transfer are to be paid by the Plaintiff. BY THE COURT, ___________________________ Kevin A. Hess, P.J. Jason M. Weinstock, Esquire For the Plaintiff Sanford Kelson, Esquire Michael J. Bruzzese, Esquire For the Defendants :rlm