January 13, 2014
L & W SUPPLY CORP. D/B/A BUILDING SPECIALTIES Appellant
ATUL K. AMIN AND CMG OF EASTON, INC. Appellee L & W SUPPLY CORP. D/B/A BUILDING SPECIALTIES Appellant
ATUL K. AMIN, INDIVIDUALLY AND T/D/B/A AKA-PRA LIMITED PARTNERSHIP AND PANNDA, INC. AND CMG OF EASTON, INC. Appellee
Appeal from the Order Entered October 10, 2012 In the Court of Common Pleas of Monroe County Civil Division at No(s): 4733 CV 2010, 10051 CV 2010
BEFORE: BOWES, J., MUNDY, J., and FITZGERALD, J.[*]
Appellant, L. & W. Supply Corp., d/b/a Building Specialties, appeals from the trial court's final orders entered October 10, 2012, in these related mechanics' lien and civil actions. In its appeal, Appellant challenges decisions contained in a number of the trial court's orders, including the trial court's 1) March 25, 2011 order granting in part Appellee Atul K. Amin's (Amin) preliminary objections to Appellant's amended complaint in its civil action; 2) December 14, 2011 order granting CMG of Easton, Inc.'s (CMG) motion for summary judgment in Appellant's civil action; and 3) October 10, 2012 order granting Amin's combined motion for summary judgment in both Appellant's mechanics' lien claim and civil action. After careful review, we affirm.
Based on our close review of the certified record, we set forth the pertinent factual and procedural history of these cases as follows. On or about January 8, 2008, AKA-PRA Limited Partnership (AKA-PRA) as owner, and CMG as general contractor, entered into a contract for certain construction on an outpatient surgery center and doctor offices located at 7191 State Route 611, Stroud Township, Monroe County, Pennsylvania. Subsequently, CMG subcontracted with Vegas East Construction, LLC (Vegas) in July 2008 to perform certain specified work for phase III of the project. Vegas, in turn, contracted with Appellant to supply materials required for its performance of the subcontract, including metal studs, drywall and insulation. According to Appellant, as of the time it initiated the instant suits, it had provided Vegas with $17, 905.81 worth of materials for which it had not been paid. Vegas filed for Chapter 7 Bankruptcy on July 21, 2010.
Relative to Appellant's mechanics' lien claim, the following ensued. On May 21, 2010, Appellant filed a mechanics' lien claim at trial court docket number 4733 CV 2010 against Amin, as alleged owner of the project premises, claiming $17, 905.81 due from Vegas for unpaid invoices. Amin filed preliminary objections on September 22, 2010, alleging procedural deficiencies in the filing of the claim. With leave of court, Appellant filed an amended mechanics' lien claim against Amin on December 2, 2010, addressing the procedural concerns.
On December 20, 2010, Amin filed preliminary objections to Appellant's amended mechanics' lien claim, averring in part that he was not the owner of the property as alleged by Appellant. Appellant, on January 6, 2011, filed a petition for leave to amend its mechanics' lien claim, seeking to add AKA-PRA as owner. On March 25, 2011, the trial court denied Amin's preliminary objections and denied without prejudice Appellant's petition to amend. Appellant subsequently filed a praecipe for entry of default judgment in the mechanics' lien claim on April 6, 2011. Amin filed a petition to open the judgment on April 15, 2011. On April 21, 2011, Amin filed a complaint to join additional defendant CMG. On July 6, 2011, the trial court granted Amin's petition to open the default judgment. On August 1, 2011, the trial court granted Amin's unopposed motion to discontinue his third party complaint against CMG. On January 9, 2012, Appellant filed a second amended mechanics' lien claim, revising the claim to $9, 905.81 due, reflecting receipt of subsequent payments.
Amin filed a motion for summary judgment on July 17, 2012, again averring he was erroneously designated as owner of the premises. On March 9, 2012, Appellant filed a cross-motion for summary judgment. The trial court granted Amin's motion for summary judgment and denied Appellant's cross motion for summary judgment on October 10, 2012, and dismissed Appellant's mechanic's lien claim.
Relative to Appellant's civil case, which commenced the action on its mechanics' lien claim, Appellant filed a civil complaint at trial court docket number 10051 CV 2010 against Amin and CMG on October 18, 2010. CMG filed preliminary objections to Appellant's complaint on November 12, 2010, averring, inter alia, that Appellant failed to join an indispensable party. Thereafter, Appellant filed a seven count amended complaint, naming as defendants Atul K. Amin, individually and t/d/b/a AKA-PRA Limited Partnership and Pannda, Inc., and CMG on November 29, 2010.
On December 20, 2010, Amin filed preliminary objections in the nature of a demurrer to all counts against it in Appellant's amended complaint. On March 25, 2011, the trial court sustained Amin's preliminary objections in part and denied them in part. Specifically, the trial court sustained Amin's objections to counts I, II, IV, and VII, and denied his objections to counts III and V.
Amin filed a motion for summary judgment on July 17, 2011 on the remaining counts. On September 12, 2011, CMG filed a motion for summary judgment on all counts against it in Appellant's amended complaint. On December 14, 2011, the trial court granted CMG's motion for summary judgment, dismissing, as against CMG, counts III, IV, V, and VI. Amin filed another motion for summary judgment on February 9, 2012. On October 10, 2012, in the same order that dismissed Appellant's mechanics' lien claim, the trial court granted Amin's motions for summary judgment, dismissing all remaining claims in Appellant's amended complaint. On November 7, 2012, Appellant filed timely notices of appeal from the orders in both cases. This Court, acting sua sponte, consolidated the appeals on January 29, 2013.
On appeal, Appellant raises the following issues for our consideration.
A. [Whether]  Amin is the owner or reputed owner of the property, as defined by the Mechanic's Lien Law of 1963, that was liened by the [Appellant][?]
B. [Whether] [Appellant], a materialman, stated cognizable claims for an equitable lien, a constructive trust, unjust enrichment, and common law fraud against  Amin t/d/b/a AKA-PRA Limited Partnership and Pannda, Inc.[?]
C. [Whether] [Appellant] should have been permitted to proceed to trial against the [CMG] and the owner defendants on its claims as a third-party beneficiary, for unjust enrichment, a declaratory judgment, an equitable lien, and under the Contractor and Subcontractor Payment Act[?]
Appellant's Brief at 6.
In his first issue, Appellant avers the trial court erred in granting Amin's motion for summary judgment in his mechanics' lien claim. "[O]ur standard of review of an order granting summary judgment requires us to determine whether the trial court abused its discretion or committed an error of law[, ] and our scope of review is plenary." Petrina v. Allied Glove Corp., 46 A.3d 795, 797-798 (Pa.Super. 2012) (citations omitted). "We view the record in the light most favorable to the nonmoving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party." Barnes v. Keller, 62 A.3d 382, 385 (Pa.Super. 2012), citing Erie Ins. Exch. v. Larrimore, 987 A.2d 732, 736 (Pa.Super. 2009) (citation omitted). "Only where there is no genuine issue as to any material fact and it is clear that the moving party is entitled to a judgment as a matter of law will summary judgment be entered." Id. The rule governing summary judgment has been codified at Pennsylvania Rule of Civil Procedure 1035.2.
Appellant assigns error to the trial court for granting Amin's motion for summary judgment on Appellant's mechanics' lien claim on the basis that Amin was not the owner or reputed owner of the subject property. Appellant's Brief at 15. To the contrary, Appellant asserts, "Amin is the owner or the reputed owner, as defined by the Mechanic's Lien Law of 1963, 49 P.S. § 1101 et seq., of the liened property." Id.
Reviewing the record in the light most favorable to Appellant, the trial court summarized the factual circumstances regarding Amin's relationship to the property and the contracts as follows.
The record owner of the Property is the Partnership. There is a deed to this effect that was recorded on October 10, 2006, which was and is available in the public records. The Partnership has owned the Property at all times relevant to this proceeding. The Partnership is a duly registered legal entity, organized under provisions of the Pennsylvania Revised Uniform Limited Partnership Act. The Partnership was established by Dr. Amin to participate in a Trust for his minor children on December 2, 1994.
The Partnership has two general partners, PANNDA, Inc. ("Pannda") and Devendra K. Amin as Trustee of three irrevocable trusts in favor of Dr. Amin's children. Pannda is a Pennsylvania
corporation. Dr. Amin is the President and a shareholder of Pannda. [Appellant] has produced no evidence that Dr. Amin has traded or done business as Pannda or the Partnership. [Appellant] concedes that it has had no contact or dealings with Dr. Amin prior to these proceedings. Dr. Amin is not a partner in the Partnership.
Dr. Amin does not hold any interest in the Property as an individual. The professional corporation that employs Dr. Amin, Atul K. Amin, MD, P.C., rented space at the Property.
Trial Court Opinion, 10/10/12, at 5.
Appellant advances several arguments in support of his position. First, Appellant claims the trial court erred in determining that Amin should not be estopped from denying ownership where "Amin represented and held himself out to the public, including [Appellant], that he was the owner of the property." Appellant's Brief at 16. Second, Appellant claims the trial court erred in adopting a restricted definition of "reputed owner" used in prior cases employing the now abrogated strict construction precepts when interpreting the mechanics' lien statute. Id. "The statute only requires the 'name and address of the owner or the reputed owner' be set forth in the claim. Reputed owner means one who has to all appearances the title to and possession of the property; one who from all appearances is the owner." Id., citing Black's Law Dictionary (page and edition unspecified). Third, Appellant claims the trial court erred in failing to hold that Amin, through his close interconnection with AKA-PRA, Pannda, and the family trusts, had an "equitable interest" in the property sufficient to satisfy the act. Id. at 17. "Amin is an owner of the property through his ownership of the stock of Pannda and, he obviously has an equitable interest through his family trust, the family partnership, and the family corporation of which he is an owner and its President." Id. Fourth, Appellant claims the trial court erred in failing to consider the tenancy of Amin's medical practice as an estate or interest "adequate to sustain a lien claim." Id. at 17-18. Fifth, Appellant claims the trial court erred in entering its March 25, 2011 order, denying its motion to amend the lien claim to include the title holder. Id. at 20.
Relative to this issue, the act requires in pertinent part as follows.
§ 1503. Contents of claim
The claim shall state:
(1) the name of the party claimant, and whether he files as contractor or subcontractor;
(2) the name and address of the owner or reputed owner;
49 P.S. § 1503. "Owner" is further defined by the statute as "an owner in fee, a tenant for life or years or one having any other estate in or title to property." 49 P.S. § 1201(3).
The statute does not define "reputed owner." In Delmont Mechanical Services, Inc. v. Kenver Corp., 677 A.2d 1241, 1245 (Pa.Super. 1996), this Court addressed an argument that the Mechanics' lien law should encompass a definition of "reputed owner" as set forth in Black's Law Dictionary. The definition proposed was "one who has to all appearance of title to, and possession of, property; one who from all appearances, or from supposition, is the owner of a thing. He who has the general credit or reputation of being the owner or proprietor of goods." Id. at 1244, quoting Black's Law Dictionary (page and edition unspecified). Applying strict construction principles, the Delmont Court declined, for the purposes of the Mechanics' Lien Law, to extend the definition of "reputed owner" beyond its narrow application to situations "where the owner who contracted for the work transfers the property before the lien claim is filed." Id.
Appellant suggests that this holding has been abrogated by Bricklayers of Western Pennsylvania Combined Funds, Inc. v. Scott's Development Co., 41 A.3d 16 (Pa.Super. 2012) (en banc), appeal granted in part, 58 A.3d 748 (Pa. 2012). We disagree. In Bricklayers, this Court determined that a liberal construction of the definition of "subcontractor" was necessary to effectuate the Mechanics' Lien Laws' remedial purpose of protecting pre-payment of labor and materials. Id. at 28. However, the Bricklayers Court continued to recognize a strict compliance standard with notice/service and content of claim requirements of the Mechanics Lien Law. Thus, the Bricklayers court drew a distinction between the creation and perfection of a lien claim relating to the procedural requirements as opposed to the definition of "subcontractor" relating to the substantive scope of the statute. Id.
Appellant argues that Amin's interconnectedness with the entity that actually owns the property, and the entity leasing the property, should suffice, under principles of liberal construction, to define him as a reputed owner. Appellant's Brief at 17-18. Appellant also contends that Amin's representations of ownership contained in his first set of preliminary objections should operate to estop him from now denying ownership. Id. at 16. The trial court noted that the ownership of the property was a matter of public record, in no way obfuscated, obscured or ambiguous, and was ascertainable by Appellant upon minimal due diligence by checking public records or the parent contract. Trial Court Opinion, 10/10/12, at 9. The trial court further determined that the misrepresentations in Amin's initial preliminary objections, occurring after Appellant's mechanics' lien claim was filed, could not have been relied on by Appellant in naming Amin as owner.
Based on our review of the record and the particular facts of this case, we conclude that Appellant's erroneous designation of Amin as owner ran afoul of the strict procedural requirements that are still valid under Bricklayers. Accordingly, we conclude the trial court did not err or abuse its discretion in granting Amin's motion for summary judgment on Appellant's mechanics' lien claim.
Appellant's second issue raises a challenge to the trial court's March 25, 2011 order granting in part Amin's preliminary objections to its amended complaint. We begin by acknowledging our well-settled standard of review of a trial court's order sustaining preliminary objections.
[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.
Richmond v. McHale, 35 A.3d 779, 783 (Pa.Super. 2012), quoting Feingold v. Hendrzak, 15 A.3d 937, 941 (Pa.Super. 2011).
Appellant develops his argument on this issue in three subparts. Appellant first contends that it stated a cognizable claim against Amin for unjust enrichment in count IV of its amended complaint, and that the trial court erred in sustaining Amin's preliminary objections in the nature of a demurrer for dismissal of the claim. Appellant's Brief at 23. The elements of unjust enrichment have been described by this Court as follows.
A quasi-contract imposes a duty, not as a result of any agreement, whether express or implied, but in spite of the absence of an agreement, when one party receives unjust enrichment at the expense of another. In determining if the doctrine applies, we focus not on the intention of the parties, but rather on whether the defendant has been unjustly enriched. The elements of unjust enrichment are 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. The most significant element of the doctrine is whether the enrichment of the defendant is unjust; the doctrine does not apply simply because the defendant may have benefited as a result of the actions of the plaintiff. Where unjust enrichment is found, the law implies a quasi-contract which requires the defendant to pay to plaintiff the value of the benefit conferred. In other words, the defendant makes restitution to the plaintiff in quantum meruit. By its nature, the doctrine of quasi-contract, or unjust enrichment, is inapplicable where a written or express contract exists.
Northeast Fence & Iron Works, Inc. v. Murphy Quigley Co., Inc., 933 A.2d 664, 668-669 (Pa.Super. 2007) (internal quotation marks and citations omitted), appeal denied, 947 A.2d 737 (Pa. 2008).
"[Appellant] averred that the Owner Defendants were liable because they received the benefit of [Appellant's] performance and never paid anyone for it." Appellant's Brief at 23. Amin counters that Appellant made an admission that the owner paid CMG under its contract and, therefore, a claim for unjust enrichment against the "owner" defendants cannot lie. Amin's Brief at 16. The trial court agreed, citing Appellant's amended complaint at paragraph 63, which stated as follows. "Upon information and belief, the Owner paid CMG but CMG failed to properly pay Vegas." Appellant's Amended Complaint, 11/29/10, at 12, Count VI, ¶ 63. Given this averment in its amended complaint, Appellant failed to allege Amin received a benefit without payment and consequently failed to state a claim for unjust enrichment. In light of the foregoing, we discern no error by the trial court in sustaining Amin's preliminary objection to count IV of Appellant's amended complaint.
Secondly, Appellant contends the trial court erred in sustaining Amin's preliminary objection in the nature of a demurrer to count VII of its amended complaint alleging common law fraud. Appellant's Brief at 25. "[Appellant] averred all of the required elements of a fraud claim under Pennsylvania common law. Because [Appellant] stated a valid common law fraud claim against the Owner Defendants, the demurrer to Count VII should have been denied." Id. at 26 (citation omitted).
"Fraud is a generic term used to describe anything calculated to deceive, whether by single act or combination, or by suppression of truth, or suggestion of what is false, whether it be by direct falsehood or by innuendo, by speech or silence, word of mouth, or look or gesture." Blumenstock v. Gibson, 811 A.2d 1029, 1034 (Pa.Super. 2002) (citations omitted), appeal denied, 828 A.2d 349 (2003).
To establish a prima facie case of fraud, a plaintiff must show
(1) a representation; (2) which is material to the transaction at hand; (3) made falsely, with knowledge of its falsity or recklessness as to whether it is true or false; (4) with the intent of misleading another into relying on it; (5) justifiable reliance on the misrepresentation; and (6) the resulting injury was proximately caused by the reliance. Unsupported assertions and conclusory accusations cannot create genuine issues of material fact as to the existence of fraud.
Kostryckyj v. Pentron Laboratory Technologies, LLC, 52 A.3d 333, 338-339 (Pa.Super. 2012). Additionally, "[f]raud must be averred with particularity, Pa.R.C.P. 1019(b), and it must be proven by clear and convincing evidence." Ellison v. Lopez, 959 A.2d 395, 398 (Pa.Super. 2008) (citation omitted), appeal denied, 968 A.2d 233 (Pa. 2009).
The trial court determined that Appellant failed to meet the heightened specificity requirements for pleading fraud established by rule 1019(b). Trial Court Opinion, 3/25/11, at 12. The only specific instances, contained in Appellant's amended complaint, of Amin's alleged misrepresentation of himself as owner included a paragraph in Amin's preliminary objections to Appellant's mechanic's lien claim averring Amin was the owner, exhibits to those preliminary objections of releases stating Amin was the owner, and a passage in a brief filed by Amin in September, 2010 identifying Amin as owner. Appellant's Amended Complaint, 11/29/10, at 14-15, Count VII, ¶¶ 77-81. As the trial court noted, even if those statements of ownership were deliberate, they occurred well after the events upon which the Appellant's claims are based and, therefore, "[Appellant] could not have relied on the misrepresentations of Amin." Trial Court Opinion, 3/25/11, at 13. Nowhere does Appellant plead with "particularity" how it justifiably relied on any misrepresentations regarding ownership of the property to its detriment in providing materials to Vegas. Accordingly, we conclude the trial court committed no error or abuse of discretion in sustaining Amin's preliminary objection in the nature of a demurrer and dismissing, as to Amin, count VII of Appellant's amended complaint alleging common law fraud.
Appellant thirdly contends the trial court erred in sustaining Amin's preliminary objection in the nature of a demurrer to Counts I and II of its amended complaint, wherein it alleged a cause of action for an equitable lien and constructive trust. Appellant's Brief at 27. Appellant argues that as a materialman it had first priority to all unpaid contract funds due from owner to Vegas, creating an equitable lien on those funds. Id. at 28. "Thus, pursuant to its equitable lien rights, [Appellant], as an unpaid supplier, was entitled to direct payment from the Owner and the General Contractor out of the undisbursed contract funds that are being held in trust for [Appellant's] benefit as of the date they received notice of [Appellant's] claim." Id. at 29. However, such a claim is dependent upon a contractual foundation.
An equitable lien arises from a contract indicating an intent to make certain property security for an obligation or from a situation which otherwise would result in unjust enrichment. In order for an equitable lien to arise there must be an obligation owing by one person to another, a res to which that obligation attaches, and an intent by all parties that the property serve as security for the payment of the obligation.
R. M. Shoemaker Co. v. Southeastern Pennsylvania Economic Development Corp., 419 A.2d 60, 63 (Pa.Super. 1980) (citations omitted)
In order that a third person acquire rights in a contract, both parties to the contract must so intend and must indicate that intention in the contract. A promisor cannot be held liable to an alleged third party beneficiary unless the latter was within his contemplation at the time the contract was entered and such liability was intentionally assumed by him in the undertaking. The obligation to the third party must be created and must affirmatively appear in the contract itself.
Id. at 62-63 (Citations omitted).
Instantly, Appellant's complaint contained no averments that in his contract with CMG, Amin undertook any obligation toward materialmen in general or Appellant in particular. Neither was the contract made part of the pleadings. Accordingly, Appellant failed to plead facts sufficient to state a claim for an equitable lien against Amin. Appellant cites Trevdan Bldg. Supply v. Toll Bros., Inc., 996 A.2d 520 (Pa.Super. 2010), which "upheld an unpaid supplier's rights to the remaining contract funds." Appellant's Brief at 30. However, unlike Appellant's pleading in this case, the Trevdan Court noted the owner's contract in that case contained a contractual basis for those rights.
[Owner's contract] contains express conditions directing the contractor to pay its subcontractors, materialmen, and laborers and to certify that payment had been rendered as a condition of payment. In addition, pursuant to both contracts, failure to pay subcontractors and materialmen constitutes a material breach of contract that permits the owner to retain sufficient funds to satisfy the contractor's payment obligation.
Id. at 526.
Absent such averments of a comparable contractual foundation in the pleadings in Appellant's civil action, we discern no error or abuse of discretion by the trial court in sustaining Amin's preliminary objection to counts I and II, alleging equitable lien and constructive trust. We note the trial court determined this issue on the basis that Appellant had an adequate remedy at law and therefore his equitable claims were unavailable. Trial Court Opinion, 3/25/11, at 13. However, "[o]n appeal, the reviewing court may affirm for any sound reason, and is not limited to the grounds relied upon by the trial court if the result is correct." Larsen v. Philadelphia Newspapers, Inc., 602 A.2d 324, 332 (Pa.Super. 1991), appeal denied, 641 A.2d 587 (Pa. 1992).
In his final issue, Appellant raises a challenge to the trial court's October 10, 2012 order granting Amin's motion for summary judgment on counts III and V in Appellant's civil complaint, and the trial court's December 14, 2011 order granting CMG's summary judgment motion on all counts against it in Appellant's amended complaint.
We first address Appellant's claim that the trial court erred when it granted CMG's motion for summary judgment. We have previously articulated our standard of review when addressing a challenge to a grant of summary judgment. Appellant premises its claims against CMG in count III of its amended complaint on its assertion of third-party beneficiary status under CMG's contract with Vegas. "Because the subcontract provisions indicate an intent to ensure the payment of all subcontractors and materialmen, [Appellant] is an intended beneficiary of the contractual provisions." Appellant's Brief at 33. Appellant further avers that CMG held funds due to Vegas at the time it notified Amin and CMG of its claim on March 16, 2010. Id. Appellant argues, therefore, that it "was entitled to payment directly from the General Contractor from the remaining contract funds to the full extent of its legitimate claim as of March 16, 2010." Id. at 34.
To be considered a third-party beneficiary in [Pennsylvania] it is necessary to show both parties to the contract had an intent to benefit the third party through the contract and did, in fact, explicitly indicate this intent in the contract.
Ira G. Steffy & Son, Inc. v. Citizens Bank of Pennsylvania, 7 A.3d 278, 288 (Pa.Super. 2010), appeal denied, 27 A.3d 1015 (Pa. 2011).
Instantly, Appellant claims the following language in the contract between CMG and Vegas evidences their intention to afford third-party beneficiary status on suppliers of material to Vegas.
§ 4.1.6 The Subcontractor shall pay for all materials, equipment and labor used in connection with the performance of this Subcontract through the period covered by previous payments received from the Contractor, and shall furnish satisfactory evidence, when requested by the Contractor, to verify compliance with the above requirements. All funds disbursed by the Contractor for this project shall be used to satisfy any outstanding costs of this project involving labor and or material suppliers Invoiced to the Subcontractor.
§ 12.2 Before Issuance of the final payment, the Subcontractor, if required, shall submit evidence satisfactory to the Contractor that all payrolls, bills for materials and equipment, and all known indebtedness connected with the Subcontractor's Work have been satisfied.
CMG's Answer and New Matter, 1/3/11, exhibit A, at 4, 9, §§ 4.1.6, 12.2.
The trial court noted, however that the contract contained a specific disclaimer of any such intention. Trial Court Opinion, 12/14/11, at 6. That provision contains the following language.
§ 1.2 … The Subcontract documents shall not be construed to create a contractual relationship of any kind … between any persons or entities other than the Contractor and Subcontractor.
Id. at 2, § 1.2. "It is the practice of this Court to find against third-party beneficiary status when a[n] … agreement specifically disclaims an intent to confer such status on [third parties]." Ira G. Steffy & Son, Inc., supra at 288.
In accordance with the foregoing, we conclude the trial court committed no legal error or abuse of discretion in determining that there exists no issue of material fact relative to Appellant's purported third-party beneficiary status under the contract between CMG and Vegas. Therefore, Appellant's claim the trial court erred in granting CMG's motion for summary judgment and dismissal of count III of its amended complaint is without merit.
Appellant next claims the trial court erred in granting CMG's motion for summary judgment on count IV of its amended complaint, alleging CMG was unjustly enriched by Appellant's unpaid performance of its contract with Vegas. We have described the elements and burdens for such a claim in our discussion, supra, of the trial court's grant of Amin's preliminary objections. See Northeast Fence & Iron Works, supra. Similar to that discussion, the issue here turns on whether CMG received a benefit for which no compensation was paid. Appellant contends as follows.
[CMG] was unjustly enriched as it received the benefit of [Appellant's] materials of $17, 905.81 and, never properly paid for them. [CMG] has submitted no proof of full payment of the total amounts of the subcontracts with [Vegas]. In fact, the last payment application produced by [CMG] reflects that $24, 877.16 was still left to be paid to the [Vegas].
Appellant's Brief at 37 (citation omitted).
The trial court, viewing the record before it, concluded otherwise.
CMG has provided, attached to its motion for summary judgment, a "Partial Subcontractor Lien Waiver and Release, " which evidences that CMG has paid Vegas a total of $182, 493.72 for work completed as of April 30, 2010. That waiver and release reflects a payment by CMG of $31, 269.73, or the sum of Vegas' payment applications numbered four, five, and six. The last application for payment in the record, application number six, evidences a "Balance to Finish" of $24, 877.16. Although [Appellant] reads this as CMG's outstanding balance due to Vegas, it is not. Rather, this amount reflects the "Contract Sum to Date" less the "Total Earned Less Retainage." See Application and Certificate for Payment No. 6 dated April 8, 2010 for the period to April 30, 2010. Accordingly, although it may be that $24, 877.16 worth of work remains outstanding on the CMG/Easton contract, payment application number 6 and the waiver and release demonstrate that CMG has paid Vegas for the work and materials provided as of April 30, 2010. It is undisputed that the materials provided by [Appellant] were billed to Vegas in December 2009. [Appellant] has not contradicted this evidence. Accordingly, CMG has paid for the materials supplied by [Appellant] to Vegas for the work on the CMG/Vegas contract.
Trial Court Opinion, 12/14/11, at 7.
In our examination of the record, we find support for the trial court's determination. To the extent there are unpaid sums under the CMG/Vegas subcontract, they are not for work or materials already provided to the project by Vegas. Thus, there is no material fact in dispute, contesting that CMG has received no value for which due consideration has not been provided. We discern no error or abuse of discretion in the trial court's granting CMG's motion for summary judgment on count IV of Appellant's amended complaint.
Appellant's argument that it has advanced a legitimate claim for a constructive trust in count V of its Amended complaint, and that the trial court erred in granting both CMG's and Amin's respective motions for summary judgment on this issue, similarly fails.
"A 'constructive trust' is defined as a relationship with respect to property subjecting the person by whom the title to the property is held to an equitable duty to convey it to another on the ground that his acquisition or retention of the property is wrongful and that he would be unjustly enriched if he were permitted to retain the property."
Commerce Bank/Pennsylvania v. First Union Nat. Bank, 911 A.2d 133, 144 (Pa.Super. 2006) (citation omitted); see also Ira G. Steffy & Son, Inc., supra at 287, n.11 (claim for constructive trust is not available absent unjust enrichment). Accordingly, we conclude the trial court correctly granted summary judgment to CMG on count V of Appellant's amended complaint.
Appellant next contends the trial court erred in granting summary judgment to CMG on its claim, raised in count VI of its amended complaint, under the Contractor and Subcontractor Payment Act, 75 P.S. § 501 et seq. Appellant's Brief at 42. Appellant asserts, "[CMG] could not lawfully continue to pay [Vegas] when it had notice that [Appellant] had not been paid for its materials. Id.. Appellant grounds its claim on its purported status as "the equitable assignee of [CMG's] duties under the Act to [Vegas]." Id. at 42, n.7. Further Appellant baldly avers "the Act was intended to provide it with a remedy and that [Appellant] is the intended beneficiary of [CMG's] obligation under the Act to [Vegas]. Id. As noted above, Appellant has not established a legitimate issue supporting its alleged status as third-party beneficiary or its claim for equitable lien and constructive trust. Further, Appellant's interpretation of the Act is flawed. With respect to contractor/subcontractor payments, the act specifically provides as follows.
§ 507. Contractor's and subcontractor's payment obligations
(a) Entitlement to payment.--Performance by a subcontractor in accordance with the provisions of the contract shall entitle the subcontractor to payment from the party with whom the subcontractor has contracted.
73 P.S. § 507 (emphasis added). There is nothing in the Act that independently creates a right or cause of action in a subcontractor to payment from an entity with which it did not contract. To the contrary, the Act provides as follows.
§ 516. Third party claims
Once a contractor has made payment to the subcontractor according to the payment terms of the construction contract or the provisions of this act, future claims for payment against the contractor by parties owed payment from the subcontractor which has been paid shall be barred.
Id. § 516.
As noted above, CMG paid Vegas for all invoiced amounts under the contract. Even if CMG had notice of Appellant's claim against Vegas before CMG made its own final payment to Vegas, the Act does not require CMG to directly pay Appellant, a party with which it did not contract, in lieu of payment to Vegas. Accordingly, we conclude the trial court did not err or abuse its discretion in granting CMG's motion for summary judgment and dismissing count VI of Appellant's amended complaint.
Appellant, in its final argument pertaining to the trial court's December 14, 2011 order, asserts the trial court erred in granting CMG's motion for summary judgment while discovery was still pending. Appellant's Brief at 44. Specifically, Appellant avers CMG never produced, as ordered, "its payment applications to the Owner, all of [Vegas's] payment applications, information on payments to [CMG] by Owner, the contractual sums unpaid as of the lien notice, the substantial completion date of the Project, the contract balance of [CMG], [CMG's] communications with [Appellant], and other critical documents related to [Appellant's] claim." Id.
In Pennsylvania, "parties must be given reasonable time to complete discovery before a trial court entertains any motion for summary judgment[.]" Reeves v. Middletown Athletic Ass'n, 866 A.2d 1115, 1124 (Pa.Super. 2004) (emphasis added). Specifically, Pennsylvania Rule of Civil Procedure 1035.2 provides the following in pertinent part.
After the relevant pleadings are closed, but within such time as not to unreasonably delay trial, any party may move for summary judgment in whole or in part as a matter of law
(1) whenever there is no genuine issue of any material fact as to a necessary element of the cause of action or defense which could be established by additional discovery or expert report, or
(2) if, after the completion of discovery relevant to the motion, including the production of expert reports, an adverse party who will bear the burden of proof at trial has failed to produce evidence of facts essential to the cause of action or defense which in a jury trial would require the issues to be submitted to a jury.
Pa.R.C.P. 1035.2 (emphasis added). … [T]his Court has unequivocally stated that the purpose of Rule 1035.2 is to eliminate cases prior to trial where a party cannot make out a claim or defense after relevant discovery has been completed; the intent is not to eliminate meritorious claims prematurely before relevant discovery has been completed. Moreover, [t]he adverse party must be given adequate time to develop the case and the motion [for summary judgment] will be premature if filed before the adverse party has completed discovery relevant to the motion.
Anthony Biddle Contractors, Inc. v. Preet Allied American Street, LP, 28 A.3d 916, 928-929 (Pa.Super. 2011) (some internal quotation marks and citations omitted).
Instantly, Appellant has failed to demonstrate how the desired discovery could create a "genuine issue of any material fact as to a necessary element of [its] cause[s] of action." Pa.R.C.P. 1035.2(1). CMG's payment applications to the owner and owner's payment to CMG cannot shed light on CMG's obligation to pay Appellant under any of the theories raised in its amended complaint. Vegas's payment applications 4, 5, and 6, cover the relevant time period of the claim and reflect the final status before Vegas entered into bankruptcy. Receipt of earlier payment notices would not present a disputed issue of material fact on any of Appellant's claims. Similarly, given that the record establishes that Vegas was paid in full for its partial fulfillment of its contract with CMG, the status of CMG's contract with the owner does not implicate the causes of action plead by Appellant against CMG in this case.
In light of these considerations, we conclude CMG's motion for summary judgment was not premature as there is no genuine issue of any material fact "which could be established by additional discovery." Id. Accordingly, we discern no abuse of discretion by the trial court in deciding CMG's motion for summary judgment in the absence of the sought-after discovery.
Appellant's last two sub-issues address the trial court's grant of Amin's summary judgment motion relative to counts III and V of Appellant's amended complaint. With respect to count III alleging third-party beneficiary status under the general contract with CMG, we have noted above the absence of any provision evidencing directly or implicitly such intention by the parties to the contract. See nn. 9, 10 supra. In accordance with the principles elucidated in our discussion of these issues in the context of CMG's motion for summary judgment, we similarly conclude the trial court did not err in granting Amin's motion for summary judgment as to counts III and V.
To summarize, Appellant's erroneous designation of Amin as owner of the subject property did not comport with the strict compliance notice and service requirements of the Mechanics' Lien Law, which remain intact notwithstanding the holding in Bricklayer, articulating the application of liberal construction in defining lien claimants. Further, we conclude the facts of this case do not warrant designating Amin as a "reputed owner" under the Mechanics' Lien Law. We conclude the trial court properly determined that Appellant failed to plead and/or present any material fact in dispute sufficient to preclude the sustaining of Amin's preliminary objections or Amin's and CMG's motions for summary judgment. Having determined Appellant's contrary arguments to be meritless, we affirm the October 10, 2012 order dismissing Appellant's mechanics' lien claim and amended complaint.