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BAUMAN v. DEL VECCHIO

October 29, 1976

BAUMAN And VOGEL, C.P.A.
v.
DR. LEONARD DEL VECCHIO and VIRGINIA DEL VECCHIO, h/w individually, and PHYSICIANS MEDICAL CENTER, INC., BERKS MEDICAL AND DENTAL CENTER, INC., ASSOCIATES AND PHYSICIANS HEALTH SERVICE PLAN, INC., through their President and Sole Shareholder, DR. LEONARD DEL VECCHIO


Troutman, J.


The opinion of the court was delivered by: TROUTMAN

TROUTMAN, J.

 Introduction

 This is a diversity action based upon an alleged breach of contract. Plaintiff, a professional corporation incorporated under the laws of New Jersey with its place of business at 571 Pompton Avenue, Cedar Grove, New Jersey, alleges that defendants failed to pay plaintiff the reasonable value of professional accounting services rendered. Defendant Leonard Del Vecchio is a doctor living in Douglasville, Pennsylvania, and is the sole shareholder of defendants, Physicians Medical Center, Inc.; Berks Medical and Dental Center, Inc.; and Associates and Physicians Health Service Plan, Inc., all Pennsylvania corporations. *fn1" Defendants have filed a motion to dismiss under Rule 12(b)(6), F.R.Civ.P., or in the alternative for summary judgment under Rule 56. For the reasons hereafter stated, the motion will be granted.

 The Complaint

 According to the complaint, Dr. Del Vecchio verbally requested the professional services of Samuel Bauman *fn2" in his capacity as a certified public accountant in connection with several of defendants' corporate ventures which required financial and accounting support. Thereafter, from June 1973 until August 1974, Messrs. Bauman and Vogel, on behalf of the plaintiff, performed various accounting services relying on Dr. Del Vecchio's verbal promises to pay plaintiff the reasonable value thereof. Despite his request for and promise to pay for these services, Dr. Del Vecchio allegedly refused to pay plaintiff $100,000, the reasonable value of the services performed. Plaintiff also alleges that Dr. Del Vecchio defrauded the plaintiff since he made the promises without any intention to honor them, thus entitling plaintiff to punitive damages. *fn2"

 The Defendants' Motion

 Defendants have raised two separate contentions in support of their motion to dismiss or in the alternative for summary judgment. First, they argue that plaintiff, a New Jersey Corporation, never registered to do business in Pennsylvania as required by Pennsylvania's Business Corporation Law, 15 P.S. § 2001 *fn3" and cannot enforce its alleged contract because of the prohibition of 15 P.S. § 2014. *fn4" Second, they contend that the alleged contract for certified accounting services was illegal under the Pennsylvania C.P.A. Law, 63 P.S. § 9.1 et seq. and thus cannot be enforced. Because we agree with defendants that the alleged contract, having an unlawful purpose, is unenforceable, we need not discuss their first argument.

 Certified Public Accounting

 Certified public accounting is one of many professional occupations subject to extensive statutory and administrative regulation in Pennsylvania. *fn5" Pursuant to the Pennsylvania "C.P.A." Law, 63 P.S. § 9.1 et seq., the State Board of Examiners of Public Accountants is empowered to regulate the practice of public accountancy and has the authority, inter alia, to grant certification to public accountants, conduct licensing examinations, collect fees, issue permits to practice and promulgate rules of professional conduct appropriate to establish and maintain a high standard of integrity and dignity in the profession of public accountancy. 63 P.S. § 9.3. The Act also defines and prohibits certain unlawful acts. 63 P.S. § 9.12. Among these prohibited acts is the use by a person, not a certified public accountant, of the designation "certified public accountant" or "C.P.A." or any other like designation tending to indicate that such person has received or has been notified by the State Board that he is qualified to receive a certificate authorizing such use. 63 P.S. § 9.12(a).

 It is undisputed that the plaintiff, Bauman and Vogel, C.P.A., neither procured the requisite public accountancy certificate from the Pennsylvania State Board prior to rendering the professional services requested nor did it comply with the applicable procedures for certificates issued by reciprocity. See 63 P.S. § 9.15 (Exhibit B, defendants' memorandum.) Nevertheless, plaintiff avers in para. 8 of the complaint:

 
"8. Between the months of June 1973 and August 1974, plaintiffs, in their capacity as certified public accountants, performed professional services for the defendants upon the verbal request of defendant Dr. Leonard Del Vecchio, acting as afore-described."

 The essential purpose of this contract as alleged in the pleadings was to provide professional services as certified public accountants. As such, the contract was illegal since the plaintiff's primary contractual duty was to perform an unlawful act as defined in 63 P.S. § 9.12. At the time the contract was entered into, plaintiff had not qualified under the applicable Pennsylvania C.P.A. Law to use the designation "certified public accountant" or "C.P.A." and its use of such a designation was an act expressly prohibited in the statute, 63 P.S. § 9.12(a). *fn6" Plaintiff nevertheless employed the designation, "Bauman and Vogel, Certified Public Accountants, A Professional Corporation", in a letter dated January 15, 1974 *fn7" to Berks Medical & Dental Center, Birdsboro, Pennsylvania, in which plaintiff stated:

 
"* * * [We] have prepared from your books and records, without audit, statements as of September 30, 1973, as shown in the table of contents." ...

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