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Contemporary Motorcar Ltd. v. MacDonald Illig Jones & Britton LLP

Superior Court of Pennsylvania

September 19, 2013

CONTEMPORARY MOTORCAR LTD AND GEORGE LYONS, Appellants
v.
MACDONALD ILLIG JONES & BRITTON LLP, W. PATRICK DELANEY, JAMES E. SPODEN, MATTHEW W. MCCULLOUGH, BRENT DOOLITTLE, AND CARTER DOOLITTLE, Appellees

NON-PRECEDENTIAL DECISION

Appeal from the Order Entered April 18, 2012 In the Court of Common Pleas of Erie County Civil Division at No(s): 12818-2011.

BEFORE: BOWES, DONOHUE, and MUNDY, JJ.

MEMORANDUM

BOWES, J.

Contemporary Motorcar Ltd ("Contemporary") and George Lyons appeal from the April 18, 2012 order sustaining preliminary objections to their first amended complaint and dismissing Appellants' count of wrongful use of civil proceedings, 42 Pa.C.S. § 8351. Section 8351, et seq. is known as the Dragonetti Act. We affirm.

Appellants instituted this action against MacDonald Illig Jones & Britton, LLP, W. Patrick Delaney, James E. Spoden, Matthew W. McCullough, Brent Doolittle, and Carter Doolittle ("Appellees"). The complaint raised a Dragonetti Act count as well as an abuse of process count, which was pled solely against the Doolittles. Mr. Delaney, Mr. Spoden, and Mr. McCullough are attorneys employed by MacDonald Illig Jones & Britton, LLP. The law firm and three named lawyers will be collectively referred to as the attorneys.

The underlying litigation that forms the basis of the present action involved the following facts. The Doolittles owned a minority interest in a business known as Gary Miller Dodge. The attorneys instituted an action on behalf of the Doolittles in the Court of Common Pleas of Erie County. That lawsuit involved claims that they were being improperly excluded from the management and operation of Gary Miller Dodge. Gary Miller sold a franchise to Appellant Contemporary. Appellant Lyons and Gary Miller have an ownership interest in Appellant Contemporary. Gary Miller as well as the two Appellants herein were named as defendants in the underlying action instituted by the attorneys on behalf of the Doolittles. After the conduct of some discovery, Appellants filed preliminary objections in that case. Before the court ruled upon those objections, Appellees voluntarily discontinued the action against Appellants, and Appellants consented to their dismissal therein.

Appellants thereafter brought the present Dragonetti Act case against Appellees based upon Appellants' joinder in the underlying litigation, which remains pending against other defendants. Before filing an answer, Appellees presented preliminary objections to the complaint. The trial court herein concluded that, since Appellants consented to their dismissal from the underlying lawsuit almost immediately after it was instituted, that litigation was not terminated in Appellants' favor. Thus, the trial court held that Appellants could not pursue a Dragonetti Act claim against Appellees, granted Appellees' preliminary objections, and dismissed the Dragonett Act count. Appellants then voluntarily discontinued the abuse-of-process cause of action pled against the Doolittles, and appealed the grant of the preliminary objections. Appellants raise these contentions:

I. Whether or not the lower court erred in sustaining Appellees' preliminary objections to the "Dragon[e]tti Act" (42 Pa.C.S.A. §8351) claim and dismissing Appellants' complaint with prejudice by holding that Appellees' voluntary dismissal did not constitute a "termination in favor" of Appellants for purposes of a claim made under the Dragonetti Act.
II. Whether or not the lower court erred in sustaining Appellees' preliminary objections to plaintiffs' punitive damages claim and dismissing plaintiffs' complaint with prejudice as the "Dragonetti Act" (42 Pa.C.S.A. §8353) specifically provides for recovery of punitive damages.
III. Whether or not the lower court erred in sustaining Appellees' preliminary objections to the Appellants' claim for attorney's fees and dismissing appellant's complaint with prejudice as the Dragonetti Act (42 Pa.C.S.A. §8353) specifically provides for recovery of attorney's fees.

Appellants' brief at 4.[1]

Initially, we outline our standard of review.

[O]ur standard of review of an order of the trial court overruling or granting preliminary objections is to determine whether the trial court committed an error of law. When considering the appropriateness of a ruling on preliminary objections, the appellate court must apply the same standard as the trial court.
Preliminary objections in the nature of a demurrer test the legal sufficiency of the complaint. When considering preliminary objections, all material facts set forth in the challenged pleadings are admitted as true, as well as all inferences reasonably deducible therefrom. Preliminary objections which seek the dismissal of a cause of action should be sustained only in cases in which it is clear and free from doubt that the pleader will be unable to prove facts legally sufficient to establish the right to relief. If any doubt exists as to whether a demurrer should be sustained, it should be resolved in favor of overruling the preliminary objections.

Feingold v. Hendrzak, 15 A.3d 937, 941 (Pa.Super. 2011) (quoting Haun v. Community Health Systems, Inc., 14 A.3d 120, 123 (Pa.Super. 2011)). Section 8351 provides in pertinent part:

(a) Elements of action.—A person who takes part in the procurement, initiation or continuation of civil proceedings against another is subject to liability to the other for wrongful use of civil proceedings:
(1) He acts in a grossly negligent manner or without probable cause and primarily for a purpose other than that of securing the proper discovery, joinder of parties or adjudication of the claim in which the proceedings are based; and
(2) The proceedings have terminated in favor of the person against whom they are brought.

The first and crucial issue on appeal pertains to whether Appellant's satisfied § 8351(a)(2), i.e., whether the underlying action was terminated in favor of Appellants for purposes of the Dragonetti Act. If it was not, then all of Appellants' issues fail because they are premised upon the viability of a Dragonetti Act cause of action. "The determinative question in the instant case revolves around an interpretation of Section 8351(a)(2) of the Dragonetti Act. Questions of statutory construction are ...


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