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State Farm Fire and Casualty Co. v. JPC Group, Inc.

Commonwealth Court of Pennsylvania

March 9, 2017

State Farm Fire and Casualty Company A/S/O JC Investment, Inc.; Restaurant Development, LLC, Appellants
v.
JPC Group, Inc.

          Argued: February 6, 2017

          BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge HONORABLE MICHAEL H. WOJCIK, Judge HONORABLE JAMES GARDNER COLINS, Senior Judge

          OPINION

          MARY HANNAH LEAVITT, President Judge.

         State Farm Fire and Casualty Company (State Farm) appeals a decision of the Court of Common Pleas of Philadelphia County (trial court) that denied State Farm's motion in limine to preclude JPC Group, Inc. from presenting evidence on its asserted qualified immunity defense. The trial court did so because it concluded that JPC Group was acting as an employee of the City of Philadelphia when it demolished a fire-damaged building and, thus, immune from tort liability. JPC Group counters that all of the issues State Farm raises in this appeal were waived due to its failure to file a post-trial motion. We reverse and remand for further proceedings.

         Background

         On December 24, 2012, a fire severely damaged a three-story building at 4912 Baltimore Avenue in the City of Philadelphia (City). To investigate the origin of the fire, the Fire Marshal decided that either the front or back of the building had to be removed. The inspectors from the City's Department of Licensing and Inspection expressed concern that the demolition work created the risk of damage to the one-story buildings on either side of the damaged three-story building. JPC Group was selected to do the demolition work because it had previously performed such work for the City.

         The City has an annual Master Demolition Contract (Contract) with JPC Group. The Contract authorizes JPC Group to submit demolition service bids to the City "in open competition with other contractors so qualified." Reproduced Record at 36a-37a (R.R. ___). The Contract provides "no guarantee that the contractor will be awarded bids against this Contract." R.R. 37a. To be eligible to participate, JPC Group is required to provide security in the form of a "performance bond" and "payment bond" as prescribed by the City. R.R. 38a. JPC Group is further required to carry its own liability insurance that names the City, its officers, and employees as additional insureds. In addition, the Contract requires JPC Group to indemnify the City for any costs, expenses, damages, and liabilities the City might incur as a consequence of JPC Group's performance of demolition services.

         Richard Quigley, an inspector for the Department of Licensing and Inspection, testified in his deposition that the City chose JPC Group to demolish the fire-damaged building "because of the way the building was situated … a three story building above two one story buildings. So we wanted to bring on somebody who had the equipment and the manpower and the experience … to deal with the situation." R.R. 452a; Notes of Testimony, 10/24/2014, at 11-12 (N.T. ___).

         In preparation for the demolition process, JPC Group laid down tires and sheets of plywood on the roofs of the adjacent one-story buildings to protect them from falling bricks. The company then moved its excavator onto the scene to perform the demolition work. The Fire Marshal, who was present at the scene, set up a "command post" at an adjacent property to watch the demolition.[1] During the process, the sidewalls of the building collapsed outward, causing damages to the adjacent one-story buildings, one of which was owned by Jason and Min Lee, JC Investment, Inc., and Restaurant Development, LLC (Owners).

         State Farm, acting as Owners' subrogee, sued JPC Group for negligence. Owners also sued.[2] The trial court consolidated the two matters. JPC Group asserted in its answer with new matter, inter alia, that State Farm's claims were barred by the doctrine of qualified immunity. The parties deposed the City's Fire Marshal, inspectors, Chief of Contractual Services at the Department of Licensing and Inspection, as well as several employees of JPC Group. State Farm also prepared an expert report to show that JPC Group acted negligently in demolishing the fire-damaged building.

         On July 7, 2015, State Farm filed a motion in limine with the trial court to preclude JPC Group from presenting evidence on its asserted defense of qualified immunity. On December 4, 2015, State Farm's counsel sent a letter to the presiding judge of the upcoming trial, suggesting that the trial court rule on the immunity issue before trial. Counsel stated that the immunity issue, which "features so prominently in JPC Group's defense, " is "plainly a threshold question whose answer decides whether JPC can be held liable." State Farm's Reply Brief, Exhibit A at 1. Specifically, State Farm's counsel suggested the following procedure for the trial court to rule on the immunity issue: "counsel could submit short briefs on the [immunity] issue first thing Monday morning … the Court could consider these short briefs, and then hold oral argument. Then … counsel could either begin the trial with opening statements, or hear Your Honor announce her decision in favor of immunity (which would effectively end the trial)." State Farm's Reply Brief, Exhibit A at 2. After sending the above letter, State Farm filed a motion for summary judgment, which the trial court refused to consider as untimely.

         On December 7, 2015, both parties appeared before the trial court and first addressed the status of the case. State Farm's counsel informed the court that there were a number of undecided motions in limine, some of which related to the immunity issue. The trial court acknowledged that immunity would be the "first and foremost" issue to be decided. R.R. 600a. JPC Group's counsel stated that his client had responded to the motion in limine, and that "the only question is whether [the judge] want[s] to decide [the immunity issue] on papers or whether [she] want[s] to hear testimony from the witnesses with regard to that issue." R.R. 601a. Assured by JPC Group's counsel that live testimony from the witnesses would not be different from the depositions, the trial court decided to rule on the immunity issue based on the depositions. The matter was continued until December 9, 2015.

         On December 9, 2015, the parties reconvened and the trial court denied State Farm's motion in limine. The court found that JPC Group acted as an employee of the City on the date of the incident and, thus, was immune from liability under what is commonly known as the Political Subdivision Tort Claims Act, 42 Pa. C.S. §§8541-8542 (Tort Claims Act).[3] State Farm appealed to the Superior Court, without first filing post-trial motions. The Superior Court ordered State Farm to show cause as to the basis for appellate jurisdiction. State Farm responded that it was not required to file post-trial motions because the trial court had not conducted a trial; rather, the court had issued a final order by ruling on State Farm's motion in limine. The Superior Court later transferred the case to this Court.

         On appeal, [4] State Farm argues that the trial court erred in deciding that JPC Group acted as an employee of the City and is immune under Section 8541 of the Tort Claims Act, 42 Pa. C.S. §8541. State Farm contends that JPC Group acted as an independent contractor for the City. JPC Group responds that all of the issues that State Farm raises in its appeal were waived due to its failure to file post-trial motions. JPC Group also argues that, in any event, the trial court did not err in holding that it acted as an employee of the City and, thus, is immune from liability.

         Post-trial Motions

         We first consider whether State Farm was required to file post-trial motions in order to preserve the issues raised in this appeal. Post-trial motions are required by Pennsylvania Rule of Civil Procedure No. 227.1, which states, in relevant part, as follows:

         Rule 227.1. Post-Trial Relief

(a) After trial and upon the written Motion for Post-Trial Relief filed by any party, the court may
(1) Order a new trial as to all or any of the issues; or
(2) Direct the entry of judgment in favor of any party; or
(3) Remove a nonsuit; or
(4) Affirm, modify or change the ...

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