The opinion of the court was delivered by: Johnny J. Butler, Judge
BEFORE: HONORABLE BERNARD L. McGINLEY, Judge HONORABLE DAN PELLEGRINI, Judge HONORABLE ROBERT SIMPSON, Judge
HONORABLE MARY HANNAH LEAVITT, Judge HONORABLE JOHNNY J. BUTLER, Judge
Portnoff Law Associates, Ltd. and Michelle R. Portnoff, Esquire (collectively Portnoff) appeal the July 8, 2009 and November 6, 2009 orders of the Court of Common Pleas of Philadelphia County (trial court) awarding attorney's fees and expenses in the amount of $1,288,309.36 in favor of the Plaintiff Class
(Taxpayers) and against Portnoff, and correcting the computation of damages from $1,588,045.65 to $1,058,697.10, respectively. Portnoff raises seven issues before the Court: (1) whether the Pennsylvania Loan Interest and Protection Law (Act 6)*fn1 applies to a class action to recover charges paid in connection with the collection of delinquent real estate taxes; (2) whether a private tax collector can be held liable for unjust enrichment when the charges were remitted to the municipalities, the municipalities were not parties to the action, and statutory remedies exist; (3) whether the expenses incurred in providing the required notice are recoverable from the delinquent taxpayer; (4) whether the principal of a corporation can be held liable for the acts of the corporation; (5) whether an order for an accounting is proper under the facts of this case; (6) whether delinquent taxpayers can challenge a judgment already entered in favor of the municipalities for charges and interest in a separate action to recover charges and interest; and (7) whether the prevailing party can be awarded fees incurred in connection with the claims upon which the party did not prevail, and fees unreasonably and unnecessarily incurred. For the reasons that follow, we affirm the orders of the trial court.
On November 26, 2002, taxpayer Beverly Roethlein filed a class action complaint against Dawn Schmidt, Michelle Portnoff, and Portnoff Law Associates seeking judgment for unjust enrichment and violation of Act 6. On March 11, 2008, the trial court entered an order finding for the Taxpayers and against Portnoff in the total amount of $5,213,670.08. On June 8, 2008, post trial motions were granted and the Court vacated its original order and awarded $1,588,045.65, plus statutory interest and attorneys' fees.
On July 8, 2009, the trial court amended its award from $1,588,045.65 to $1,058,697.10. On November 6, 2009, the trial court granted Taxpayers' motion for attorneys' fees and administrative expenses and awarded $1,267,386.25 for attorneys' fees and $20,923.11 for expenses. Portnoff appealed the July 8, 2009 and November 6, 2009 orders to this Court.*fn2
Portnoff argues that Act 6 does not apply to a class action to recover charges paid in connection with the collection of delinquent real estate taxes. Specifically, Portnoff contends that Act 6 is a usury statute, and that the plain language of Act 6, case law, and the legislative history all mandate a finding that the statute's application is limited to claims in connection with loans or the use of money. Thus, Portnoff contends, Act 6 cannot be used to recover charges paid in connection with delinquent tax payments that do not involve agreements for loans or the use of money. Portnoff further contends that notwithstanding the above contentions, Act 6 only applies to actions filed by individuals, not class actions. We disagree with all of the above contentions.
Section 502 of Act 6, 41 P.S. § 502, is titled: "Usury and excess charges recoverable." (Emphasis added). Section 502 of Act 6 specifically states: "A person who has paid . . . charges prohibited or in excess of those allowed by . . . law may recover triple the amount of such excess interest or charges in a suit at law against the person who has collected such excess . . . charges . . . ." (Emphasis added). By the plain language of the statute, this action is permitted. We conclude that Portnoff was not permitted to collect administrative fees or interest thereon, that the administrative fees and interest were excess charges not allowed by law, and that said charges were, therefore, recoverable under Act 6.
Further, while Section 504 of Act 6 specifically states: "Any person affected by a violation of the act shall have the substantive right to bring an action on behalf of himself individually[,]"*fn3 Act 6 does not preclude such individuals from complaining collectively in the form of a class action. See Toolan v. Trevose Fed. Sav. and Loan Ass'n, 501 Pa. 477, 462 A.2d 224 (1983) (wherein a class action suit was brought under Act 6, and the Supreme Court of Pennsylvania specifically held that the right of plaintiffs to bring their original cause of action derived from Section 504 of Act 6). Thus, Taxpayers' class action is appropriate under the law.
Accordingly, the trial court did not err in allowing Taxpayers to file their action for Act 6 violations.
Portnoff next argues that a private tax collector cannot be held liable for unjust enrichment when the charges were remitted to the municipalities, the municipalities were not joined as indispensable parties to the action, and statutory remedies are available to Taxpayers. We disagree.
Initially, "[u]njust enrichment is shown by benefits conferred on defendant by plaintiff, appreciation of such benefits by defendant, and acceptance and retention of such benefits under such circumstances that it would be inequitable for defendant to retain the benefit without payment of value." Filippi v. City of Erie, 968 A.2d 239, 242 (Pa. Cmwlth. 2009) (quotation marks omitted). Here, Portnoff charged a fee, paid by Taxpayers that went directly to Portnoff, not to the municipalities as claimed by Portnoff.*fn4 Thus, regardless of Portnoff's claim that Portnoff did not appreciate the benefits conferred by Taxpayers, the elements of unjust enrichment are clearly satisfied in this case.
Regarding the issue of whether the municipalities were indispensable parties in the instant action, we note:
The criteria used to determine whether an absent party is indispensable are:
1. Do absent parties have a right or interest related to the claim?
2. If so, what is the nature of the right or interest?
3. Is that right or interest essential to the merits of the issue?
4. Can justice be afforded without violating due process rights of absent parties?
Del. Cnty. v. J.P. Morgan Chase & Co., 827 A.2d 594, 598 (Pa. Cmwlth. 2003). Here, the taxes owed to the municipalities are separate and distinct from the administrative fees paid by Taxpayers to Portnoff over and above said taxes. Thus, the municipalities have no right or interest in Portnoff's collected fees, and the municipalities were not indispensable parties to this action.
Lastly, the proposed exclusive statutory remedies that Portnoff claims preclude the claim of unjust enrichment, i.e., scire facias, and the refund statute, do not apply. Section 16 of the Municipal Claims Act (MCA)*fn5 provides that a party "may file" a notice of scire facias where appropriate. Thus, scire facias is a discretionary remedy as evidenced by the use of the word "may." Moreover, according to Section 1(a) of the Tax Refund Law,*fn6 the refund statute specifically applies to monies actually paid to the taxing authorities, i.e., specifically paid "into the treasury of any political subdivision." The administrative fees collected by Portnoff remained with Portnoff. Thus, the refund statute is not applicable, and unjust enrichment is a viable claim. Accordingly, the trial court did not err in allowing the claim against Portnoff for unjust enrichment.
Portnoff next argues that the expenses Portnoff incurred in providing the required notice are properly recoverable from a delinquent taxpayer. Specifically, Portnoff argues it is a charge, expense, or fee, incurred by the taxing authority in the collection of delinquent taxes, and that it can lawfully be recouped under the MCA. We disagree.
Section 2 of the MCA specifically states:
All taxes which may hereafter be lawfully imposed or assessed on any property in this Commonwealth, and all taxes heretofore lawfully imposed or assessed by any municipality on any property in this Commonwealth . . . shall be and they are hereby declared to be a first lien on said property, together with all charges, expenses, and fees added thereto for failure to pay promptly . . .
53 P.S. § 7103. This Court held in Pentlong Corporation v. GLS Capital, Inc., 780 A.2d 734 (Pa. Cmwlth. 2001)*fn7 that under Section 2 of the MCA, the term "costs" specifically refers to charges, expenses or fees that "were actually incurred and could have been taxed as costs" by the taxing authority. Id. at 749 (stating that a tax lien assignee "is not entitled to any costs that the County did not actually incur"). Here, the administrative fee charged by Portnoff was not such a cost because the related costs, i.e., the expenses Portnoff incurred, were incurred by Portnoff directly and never incurred by the taxing authority. Accordingly, the trial court did not err in finding that the administrative fees were not recoverable from Taxpayers.
Portnoff next argues that the principal of a corporation cannot be held liable for the acts of the corporation without evidence providing a basis to pierce the corporate veil. Specifically, Portnoff contends that there was no evidence that Michelle Portnoff, in her individual capacity, collected the administrative fees, received any payments from Taxpayers or retained the fees. Further, Portnoff contends that the evidence showed that all of the collection activity was undertaken by the corporation, and that all fees collected by the corporation were remitted by the corporation to the municipalities. We disagree.
In addition to potential liability under the doctrine of piercing the corporate veil, shareholders, officers and directors can be held liable upon the establishment of requisite factors under the "participation theory." Com. ex rel. Corbett v. Snyder, 977 A.2d 28 (Pa. Cmwlth. 2009). "Under the 'participation theory,' the court imposes liability on the participating individual as an actor, not as an owner. To impose liability under the participation theory, a plaintiff must establish the individual engaged in misfeasance." Id. at 46 (citation omitted).
Here, Michelle Portnoff actively participated in the taX collection process at every stage. She supervised, developed and approved the collection practices of the corporation. In addition, she had personal involvement with Taxpayers, i.e., mailing correspondence to them, and preparing and filing pleadings against them, thus, establishing that Michelle Portnoff engaged in misfeasance as a participating ...