Donaldson v. Davidson Bros., Inc.

• Decision Date: 14 July 2016
• Docket Number: No. 1419 MDA 2015,1419 MDA 2015
• Citation: 144 A.3d 93,2016 PA Super 150
• Parties: Kevin DONALDSON, as Administrator of the Estate of Sarah C. Donaldson, Deceased and Kevin Donaldson, as Administrator of the Estate of Sarah C. Donaldson, on Behalf of Michael Donaldson and Pamela Douglas, Natural Parents and Statutory Heirs of Decedent Sarah C. Donaldson, Appellees v. DAVIDSON BROTHERS, INC., Michael R. Davidson, and George E. Donley, Appellees v. LJF, Inc., and Wilbert Quade, Appellants.
• Court: Pennsylvania Superior Court

144 A.3d 93

2016 PA Super 150

Kevin DONALDSON, as Administrator of the Estate of Sarah C. Donaldson, Deceased and Kevin Donaldson, as Administrator of the Estate of Sarah C. Donaldson, on Behalf of Michael Donaldson and Pamela Douglas, Natural Parents and Statutory Heirs of Decedent Sarah C. Donaldson, Appellees

v.DAVIDSON BROTHERS, INC., Michael R. Davidson, and George E. Donley, Appellees

v.LJF, Inc., and Wilbert Quade, Appellants.

No. 1419 MDA 2015

Superior Court of Pennsylvania.

Argued April 20, 2016.

Filed July 14, 2016.

Reargument Denied Sept. 19, 2016.

Matthew R. Zwick, Dubois, for LJF, Inc., appellant.

Jolee M. Bovender, Harrisburg, for Davidson Brothers, Inc., and Michael R. Davidson, appellees.

Lloyd R. Hampton, Ashland, for Kevin Donaldson, appellee.

BEFORE: FORD ELLIOTT, P.J.E.,

JENKINS, J., and PLATT, J.^*

OPINION BY PLATT

, J.:

Appellant, LJF, Inc. (LJF) and Wilbert Quade, appeal from two orders of the trial court in this complicated case arising out of a fatal three-way motor vehicle accident.¹ The first order, on June 1, 2010, sustained the preliminary objections of Plaintiff/Appellee, Kevin Donaldson, Administrator of the estate of his sister, Sarah Donaldson (the Donaldson interests), and dismissed LJF's counterclaim with prejudice. The second order, dated July 22, 2015 and filed July 24,² granted the motion for judgment on the pleadings of Davidson Brothers, Inc., Michael R. Davidson, and George E. Donley³ (the Davidson interests), Defendants/Appellees, and dismissed LJF's cross-claims against the Davidson interests with prejudice. The orders of dismissal rejected LJF's loss of contract claim. LJF maintains that the trial court's reliance on the Economic Loss Doctrine to reject the loss of contract claim was improper. LJF asks us to reverse the decisions of the trial court and remand for further proceedings. Plaintiff/Appellee Donaldson and defendants/Appellees have each separately filed motions to dismiss this appeal. We decline to dismiss. However, we affirm the trial court's orders, albeit for reasons other than those relied on by the trial court.

This case has what a predecessor panel has characterized as a “remarkably complex procedural history.” (Donaldson v. Davidson, No. 293 MDA 2013, unpublished memorandum at *2, 105 A.3d 23 (Pa.Super. filed June 3, 2014)

.)⁴ We summarize only the facts and history most pertinent to the issues before us on review.

The underlying suit arises out of a tragic three-way motor vehicle accident on June 16, 2008, on Route 322 in Potter Township, Centre County which resulted in a fatality. There is no dispute that George Donley, operator of a tractor/trailer owned by Davidson Brothers, was driving westbound behind Sarah Donaldson when his tractor/trailer rear-ended her vehicle.⁵ As a result of the impact, Ms. Donaldson's car was thrust into eastbound oncoming traffic. There, she collided head-on with a tractor/trailer owned by LJF and operated by Wilbert Quade. Ms. Donaldson died from her injuries.

Kevin Donaldson, Sarah's brother and Administrator of her estate, filed a complaint on September 16, 2008. On April 30, 2009, he filed an amended complaint, which brought wrongful death and survivor actions against the Davidson interests. The Davidson interests later joined LJF and Mr. Quade as additional defendants, essentially alleging that negligence by Mr. Quade caused or contributed to the death of Ms. Donaldson.

Of special note for this appeal, on October 9, 2009, LJF settled property claims with the Davidson interests, their insurer and their attorneys, for $15,181.00. (See Property Damage Release and Settlement Agreement,” 10/09/09). The release was signed by Leo C. Frailey “[a]s [d]uly authorized agent/representative for LJF, Inc.” (Id. at 2). Specifically, the release and settlement agreement “remise[d], release[d] and forever discharge[d] Northland Insurance Company, Davidson Brothers, Inc., Michael R. Davidson, George E. Donley, and Rawle & Henderson LLP[.]” (Id. at 1). The release and settlement agreement further encompassed:

[T]heir successors, assigns, associates, heirs, executors, administrators, and/or all other persons, firms, corporations, of and from any and every claim, demand, right, or cause of action, involving property damage, down-time, clean-up, repairs, towing, and all other non-injury related costs, expenses, and/or fees (with the exception of any claim for loss of contract which is hereby preserved ) on account of or in any way growing out of, an incident or event which occurred on or about June 16, 2008 on Route 322 west of the town of Potters Mills, Potter Township, Centre County, Pennsylvania, and set forth and described in the resulting lawsuit[.]

(Id. ) (emphasis in original).

On October 29, 2009, LJF, in its Answer and Counterclaim to the joinder complaint, asserted liability claims against the Donaldson interests as well as the Davidson interests including, inter alia, a claim for “loss of contract.” (Answer of Additional Defendants, Counterclaims, ¶ 69(l )). Donaldson filed preliminary objections. The trial court sustained Donaldson's preliminary objections and dismissed LJF's counterclaim with prejudice.

LJF appealed but a panel of this Court quashed the appeal as interlocutory, reasoning that “[b]ecause the June 1, 2010 order did not dispose of LJF's cross-claim against Davidson Brothers, the order [was] not a final order for purposes of appeal.” (Donaldson, supra at *12).

The Davidson interests filed a motion for judgment on the pleadings, which the trial court granted, on July 24, 2015. The trial court denied reconsideration.⁶ This timely appeal followed.⁷

Appellant raises eight questions on appeal:

1. Whether Appellant LJF, Inc. properly pleaded the occasioning of property damage to its tractor-trailer combination so as to exclude the application of the economic loss doctrine defense as a bar Appellant's [sic] claims for loss of contract damages[?]

2. Whether, under the facts and circumstances of this case, the economic loss doctrine bars Appellant LJF, Inc.'s claims and damages for loss of contact [sic][?] ^[8]

3. Whether Appellant, LJF, Inc.'s release of property damage claims, via partial release and settlement agreement, should preclude LJF, Inc. from seeking economic losses due to loss of a contract, which resulted from property damage that was sustained in a motor vehicle collision[?]

4. Whether admissions in pleadings and provisions of a partial settlement/release agreement, which admit the occurrence of property damage in a civil action, precludes the application of the economic loss doctrine[?]

5. Whether a provision contained within a partial settlement/release agreement, which specifically and expressly reserves a releasor's right to assert claims for loss of contract arising from a motor vehicle collision, precludes the application of the economic loss doctrine to bar said claims[?]

6. Whether Plaintiff–Appellees, who were not a parties [sic] or signators to the partial release and settlement agreement, may present such agreement as the basis for asserting the economic loss doctrine as a defense to loss of contract damage claims set forth against it[?]

7. Whether the economic loss doctrine is an affirmative defense that is waived if not raised by Preliminary Objection and/or New Matter[?]

8. Whether the law of the case doctrine was properly applied to bar Appellant LJF, Inc.'s loss of contract claims against Defendant–Appellee[?]

(Appellant's Brief, at 4–5).

LJF maintains that the trial court erred in granting the preliminary objections of the Donaldson interests and the motion for judgment on the pleadings of the Davidson interests. (See id. at 16–17).

The central issue underlying all of LJF's questions, explicitly in the first seven and implicitly in the eighth, (see id. at 26), is whether an otherwise general release which expressly reserved a “loss of contract” claim adequately preserved that issue, or if it is barred by the Economic Loss Doctrine.⁹ LJF argues that the Economic Loss Doctrine does not apply.

Further, LJF posits that the Law of the Case Doctrine should not apply to enforce the Economic Loss Doctrine. LJF suggests that this Court should reverse the orders sustaining the preliminary objections and granting judgment on the pleadings and remand to the trial court for further proceedings on loss of contract. (See id. at 26–27). We disagree.

Our standard of review for the sustaining of preliminary objections is well-settled.

In determining whether the trial court properly sustained preliminary objections, the appellate court must examine the averments in the complaint, together with the documents and exhibits attached thereto, in order to evaluate the sufficiency of the facts averred. The impetus of our inquiry is to determine the legal sufficiency of the complaint and whether the pleading would permit recovery if ultimately proven. This Court will reverse the trial court's decision regarding preliminary objections only where there has been an error of law or abuse of discretion. When sustaining the trial court's ruling will result in the denial of claim or dismissal of suit, preliminary objections will be sustained only where the case is free and clear of doubt.

Floors, Inc. v. Altig, 963 A.2d 912, 915 (Pa.Super.2009)

, appeal denied, 602 Pa. 667, 980 A.2d 608 (2009) (citation omitted).

As a trial court's decision to grant or deny a demurrer involves a matter of law, our standard for reviewing that decision is plenary. Preliminary objections in the nature of demurrers are proper when the law is clear that a plaintiff is not entitled to recovery based on the facts alleged in the complaint. Moreover, when considering a motion for a demurrer, the trial court must accept as true “all well-pleaded material facts set forth in the complaint and all inferences fairly deducible from those facts.”

Yocca v. Pittsburgh Steelers Sports, Inc., 578 Pa. 479, 854 A.2d 425, 436 (2004)

(citations omitted). Similarly,

The question presented by the

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