Chervenak, Keane & Co., Inc. (C.K.C. Associates) v. Hotel Rittenhouse Associates, Inc.

• Decision Date: 10 July 1984
• Citation: 328 Pa.Super. 365,477 A.2d 487
• Parties: CHERVENAK, KEANE & COMPANY, INC. (C.K.C. ASSOCIATES) and Herbert S. Levin, Esquire, Intervening Petitioner, v. HOTEL RITTENHOUSE ASSOCIATES, INC., Appellant.
• Court: Pennsylvania Superior Court

Page 487

477 A.2d 487

328 Pa.Super. 365

CHERVENAK, KEANE & COMPANY, INC. (C.K.C. ASSOCIATES) and Herbert S. Levin, Esquire, Intervening Petitioner, v. HOTEL RITTENHOUSE ASSOCIATES, INC., Appellant.

Superior Court of Pennsylvania.

Argued Nov. 15, 1983.

Filed May 4, 1984.

Reargument Denied July 10, 1984.

Michael H. Egnal, Philadelphia, for appellant.

Barnett Satinsky, Philadelphia, for appellees.

Before SPAETH, President Judge, and BROSKY and HOFFMAN, JJ.

HOFFMAN, Judge:

In this appeal appellant challenges the lower court's refusal to open a default judgment and the court's imposition of counsel fees and costs. Finding no merit in appellant's contentions, we affirm the order of the court below.

Appellant, Hotel Rittenhouse Associates, and Chervenak, Keane and Co. (CKC), contracted in mid-1979, for CKC to advise appellant incident to the building of a hotel-condominium. After the contract was prematurely terminated, and pursuant to their earlier agreement, the parties submitted damage claims to an arbitration panel, consisting of one arbitrator appointed by each party, and appellee, a neutral arbitrator appointed by the lower court to act as panel chairman. The arbitrators' award of $130,020.60 in favor of CKC was appealed to our court by appellant in a companion case, No. 146 Philadelphia, 1982. The instant case arose subsequent to appellant's refusal to pay the full compensation (fee and costs) owed appellee. ¹ Upon appellant's refusal, appellee filed a Petition to Compel Defendant to Pay the Fee of the Independent Arbitrator on October 15, 1981. On November 2, 1981, appellant's preliminary objections were denied with leave to file an answer within fifteen days. Appellant thereupon filed an appeal of that denial which was quashed by this Court on December 28, 1981. Finally, on January 7, 1982, the lower court entered a default judgment against appellant because it had failed to file an answer to appellee's Petition to Compel Payment within the allotted fifteen days. The lower court then ordered appellant to pay a $350 fee to appellee's counsel for the proceedings surrounding the January 7 judgment. After appellant filed a motion to open and/or strike the judgment, the lower court denied the motion and requested that appellee provide a statement of supplemental fees and costs incurred by appellee. Appellee complied and the lower court granted additional fees in the amount of $4,039.99. Appellant's exceptions to the fee determination were denied. This appeal followed.

Appellant contends first that the default judgment must be stricken because it was entered prematurely and sua sponte by the lower court. We find no merit in this contention. With regard to the time of the judgment's entry, appellant avers that during the pendency of its appeal to the Superior Court, the lower court was stayed from acting in the case and that, consequently, the fifteen day period in which appellant was entitled to file an answer had not yet run when the lower court entered the default judgment on January 7. The pertinent chronological events are as follows:

                Oct. 15, 1981  Appellee petitions to compel
                               payment of arbitrator's
                               fee
                Oct. 28, 1981  Appellant files preliminary
                               objections
                Nov. 2, 1981   Preliminary objections denied
                               after hearing with
                               leave to file answer within
                               15 days
                Nov. 10, 1981  Appellant files appeal
                Nov. 19, 1981  Appellee files motion to
                               quash appeal
                Nov. 24, 1981  Appellant answers motion
                               to quash
                Dec. 28, 1981  Motion to quash granted
                               by the Superior Court
                Jan. 4, 1982   Appellee's Oct. 15, 1981
                               petition granted after appellant
                               failed to file an answer
                Jan. 7, 1982   Default judgment entered
                               on Jan. 4 order
                

Pa.R.A.P. 1701 indicates that, except in enumerated circumstances, following the filing of an appeal, a trial court cannot proceed further until disposition of the appeal. Here, however, we agree with the lower court that it took no action during the pendency and disposition of appellant's appeal and appellee's motion to quash. Appellant had been granted fifteen days from November 2, 1981, within which to file an answer. Eight days elapsed prior to appellant's filing the appeal with this court. After appellee's motion to quash the appeal was granted on December 28, ten days elapsed before the lower court entered the default judgment against appellant on January 7, 1982. Accordingly, we find that, excluding the period of time for disposition of the appeal, 18 days were available for appellant to file an answer to appellee's petition. ² Because appellant did not file an answer, the lower court correctly entered judgment in favor of appellee. ³

Appellant next maintains that the lower court abused its discretion in denying appellant's petition to open and/or strike the judgment. Again, we find no basis for this claim. A petition to open a default judgment is addressed to the equitable powers of the lower court, whose decision will not be disturbed absent an abuse of discretion. Balk v. Ford Motor Co., 446 Pa. 137, 285 A.2d 128 (1971); Carducci v. Albright Galleries, Inc., 244 Pa.Superior Ct. 48, 366 A.2d 577 (1976). A default judgment may be opened when three factors coalesce:

(1) the default may be reasonably excused;

(2) the petition to open has been timely filed; and

(3) a meritorious defense has been averred.

Queen City Electrical Supply v. Soltis Electric Co., 491 Pa. 354, 421 A.2d 174 (1980); Balk v. Ford Motor Co., supra. The above-mentioned factors must be considered in light of equitable considerations. Toplovich v. Spitman, 239 Pa.Superior Ct. 327, 361 A.2d 425 (1976). We need not address the first two requirements, finding, upon review, that they have been satisfied. We disagree, however, with appellant's assertion of a meritorious defense. Appellant claims that if the judgment were opened, its defenses, i.e. that appellee as panel chairman displayed bias and prejudice resulting in an unconscionable award and that the panel majority rendered an irregular award because of its measure of damages, would prove meritorious. As we stated in the companion case to the instant appeal, wherein appellant sought to overturn the panel's award, "That the arbitrators chose to employ a measure [of damages] more favorable to appellee may reflect on the existence of opposing interpretations of the law of damages but falls far short of 'such ignorance of the law and indifference to the justice of the result as would cause a court to vacate the award.' Hain v. Keystone Insurance Co., 230 Pa.Superior Ct. at 460, 326 A.2d at 528." Chervenak, Keane & Co. v. Hotel Rittenhouse Associates, --- Pa.Superior Ct. ---, 477 A.2d 482 (1984) (J. 2215/1983, filed May 4, 1984) slip op. at ----. Additionally, in the companion case, we agreed with the lower court that appellee did not exhibit such alleged prejudice and bias sufficient to cause reversal of the award. Accordingly, having found no merit in appellant's two direct challenges to the award, we find that neither challenge would...