Jahanshahi v. Centura Development Co., Inc.

• Decision Date: 04 February 2003
• Citation: 816 A.2d 1179
• Parties: Mehrdad Jon JAHANSHAHI, Shahrokh Naghdi and Happy Valley Roasters, Inc., Appellants v. CENTURA DEVELOPMENT CO., INC., and Keith Eck, Appellees. Mehrdad Jon Jahanshahi, Shahrokh Naghdi and Happy Valley Roasters, Inc., Appellees v. Centura Development Co., Inc., and Keith L. Eck, Individually and as President of Centura Development Co., Inc., Appellants.
• Court: Pennsylvania Superior Court

816 A.2d 1179

Mehrdad Jon JAHANSHAHI, Shahrokh Naghdi and Happy Valley Roasters, Inc., Appellants v. CENTURA DEVELOPMENT CO., INC., and Keith Eck, Appellees.

Mehrdad Jon Jahanshahi, Shahrokh Naghdi and Happy Valley Roasters, Inc., Appellees v. Centura Development Co., Inc., and Keith L. Eck, Individually and as President of Centura Development Co., Inc., Appellants.

Superior Court of Pennsylvania.

Argued November 20, 2002.

Filed February 4, 2003.

Matthew J. Zeigler, Williamsport, for Jahanshahi.

Norman M. Lubin, Williamsport, for Eck.

Before: STEVENS, OLSZEWSKI, and BECK, JJ.

OLSZEWSKI, J.

¶ 1 This is an appeal and a cross-appeal from judgment entered after a jury verdict in these consolidated cases. Both sides have assigned a number of errors to the trial court. We affirm.

¶ 2 Mehrdad Jon Jahanshahi and Shahrokh Naghdi (appellants) sought to lease an existing, empty Hardee's fast food restaurant building from Keith L. Eck (appellee) to open a Kenny Rogers Roasters franchise of their own. During a period of negotiation, appellee repeatedly assured appellants that the property would be leased to them, and led them to believe that they were the only prospective tenant. 1925(a) Opinion, 2/8/02, ("Opinion") at 9. Appellants conducted research to create a business plan to "demonstrate the economic viability of the proposed restaurant." Id. at 10. Appellants also expended other sums of money for equipment and services in anticipation of opening the restaurant.

¶ 3 On July 9, 1997, the parties met at appellee's office to sign a lease that had been printed on appellee's computer. Appellants signed the lease, and "pushed [it] toward [appellee] Eck for him to sign. [Appellee] Eck did not sign but indicated he would mail [appellants] a signed copy." Id. at 11. As stated by the trial court:

On July 22, 1997, [appellee] Eck orally informed [appellant] Jahanshahi that he had changed his mind and was not going to lease the premises to them. Instead, [appellee] Eck stated that he had received an offer to purchase the building from an undisclosed buyer for $750,000, a deal he had always wanted. [Appellee] Eck was always looking to use a signed lease to negotiate a better deal, one that he was always looking for with [another] Company.

Id. at 13. Appellants claimed at trial that appellee offered to reimburse them for their prior out-of-pocket expenses if they "would hold on, not complain about the change in plans, and be ready to continue with the lease agreement if the $750,000 did not germinate." First Amended Complaint, 12/17/99, at 11. Appellants alleged that they accepted this offer, but that appellee never satisfied this second contract. Id.

¶ 4 At trial, the jury found for appellants, and awarded them $7,850 for out-of-pocket expenses and $70,000 for loss of profits. Both sides filed post-trial motions, with appellee first on May 30, 2001. Opinion at 14. Hearings on the motions were delayed until October 24, 2001, and an order was filed that the trial judge would render a decision by November 21st. Rather than wait for the decision, appellants filed their appeal on October 29th. Appellee then cross-appealed.

¶ 5 Although neither the trial court nor the parties raised the issue of appealability, "[w]e may raise [it] sua sponte because it affects our jurisdiction over the case." Estate of Borkowski, 794 A.2d 388, 389 (Pa.Super.2002). This Court may only hear an appeal from the "final order of ... [a] lower court." Pa.R.A.P. 341(a).

¶ 6 However, the judgment here is appealable. The Rules of Civil Procedure allow either party to praecipe the prothonotary to enter judgment where, even though post-trial motions are filed, more than 120 days pass with no decision having been made to dispose of them. Pa.R.C.P. 227.4. See Armbruster v. Horowitz, ___ Pa. ___, 813 A.2d 698 (2002); Conte v. Hahnemann Univ. Hosp., 707 A.2d 230, 231 (Pa.Super.1998) ("In view of the language of Rule 227.4(1)(b) and the explanatory comment, it is clear that once the requisite 120 day period runs and a party opts to praecipe for the entry of judgment, the judgment becomes final, and immediately appealable, when it is entered on the docket.").

¶ 7 That was the case here. Appellants' brief contains a copy of their Praecipe to Enter Judgment. Although we are unable to use this information because the praecipe is not part of the certified record, Hrinkevich v. Hrinkevich, 450 Pa.Super. 405, 676 A.2d 237, 240 (1996), it explains why the official docket entry record attached to the certified record indicates that the prothonotary entered judgment on October 29, 2001. "The certified record consists of the original papers and exhibits filed in the lower court, the transcript of proceedings, if any, and a certified copy of the docket entries prepared by the clerk of the lower court." Hrinkevich, at 240 (emphasis added); see also Pa. R.A.P.1921. As the docket entry list attached to the certified record indicates that the prothonotary entered judgment on October 29, 2001, we find that the entry of judgment is part of the official record. The entry of judgment is a final order for purposes of our review. Pa.R.C.P. 227.4(1)(b).

¶ 8 We turn now to the assignments of error, which we will address in the order of the trial court's 1925(a) Opinion.

I. Appellant Assignment II: Exclusion of Evidence of Equipment Costs

¶ 9 Appellants' damages claim included the cost of the equipment they purchased in anticipation of opening their restaurant. The trial court ruled that appellants had not provided appellee the evidentiary basis for this claim, although it had been requested during discovery, and excluded this evidence. Appellants assign error. Our standard of review:

"The decision whether to sanction a party for a discovery violation and the severity of such a sanction are matters vested in the sound discretion of the trial court. We will not reverse a trial court's order imposing such a sanction unless the trial court abused its discretion." Under Rule 4019 of the Pennsylvania Rules of Civil Procedure, a trial court may impose sanctions for discovery violations.

Pioneer Commer. Funding Corp. v. Am. Fin. Mortg. Corp., 797 A.2d 269, 286-87 (Pa.Super.2002) (quoting Luszczynski v. Bradley, 729 A.2d 83, 87 (Pa.Super.1999)). Below, appellants argued that no discovery request was made for this information. Appellants' brief at 21. The trial judge states that such discovery was requested three times before the cutoff, Opinion at 20, and our own search of the record reveals such a request in the Defendants' Second Set of Interrogatories. Motion to Compel Answers, 7/19/00, Exhibit A.

¶ 10 Obviously, appellee needed to know the basis of these costs in order to properly defend against them. Such information is the subject of discovery. Pa.R.C.P. 4003.1. The trial court states that it excluded this evidence because appellee's defense was "substantially prejudiced by [appellants'] failure," Opinion at 20, and we see no abuse of discretion.

II. Appellee Assignment IV: Admission of Appellant as an Expert Witness

¶ 11 Appellee assigns error to the trial court's admission of appellant Jahanshahi's testimony as an expert witness as to lost profits on the basis that he, as a plaintiff, was not disclosed as a potential expert witness during discovery. Even if the procedural rules had been followed, appellee argues, he did not satisfy Pa.R.E. 702's requirements to qualify as an expert. Appellee's brief at 14.

¶ 12 The trial court states that appellee's original objection was to appellant Jahanshahi's testimony on lost profits on the basis that, under the Restatement of Contracts, expert testimony was necessary to establish lost profits. Opinion at 22-23. The trial court relied on Merion Spring Co. v. Muelles Hnos. Garcia Torres, S.A., 315 Pa.Super. 469, 462 A.2d 686 (1983), for the proposition that expert testimony is not required. We agree. There, this Court held:

Damages for lost profits, like other contract damages, may not be awarded when the evidence leaves the trier of fact without any guideposts except his or her own speculation. Sufficient evidence must be introduced to permit a reasonably certain estimate of the amount of anticipated profits lost due to the breach.... [T]he courts of this Commonwealth have adopted the rule suggested by [the] Restatement ... that new businesses may be able to adduce sufficient evidence to obtain an award for lost profits while recognizing that such proof is often more difficult to obtain and present.

Id. at 695-96. Specifically,

[L]ost profits from a new business may be established with reasonable certainty with the aid of expert testimony, economic and financial data, market surveys and analyses, business records of similar enterprises, and the like.

Id. at 696 (quoting Restatement, Second, of Contracts § 352, Comment b). Thus, while expert testimony might well aid the factfinder, it is not required.

¶ 13 Nevertheless, appellant Jahanshahi was tendered and accepted as an expert. N.T. Trial Vol. II, 5/20/02, at 193-95. Here, appellee argues that, because appellant was not disclosed as an expert during discovery, Pa.R.C.P. 4003.5(b) prohibited his testimony as an expert at trial. That Rule states: "An expert witness whose identity is not disclosed in compliance with subdivision (a)(1) of this rule shall not be permitted to testify on behalf of the defaulting party at the trial of the action." But where "opinions were not acquired or developed with an eye toward litigation, Rule 4003.5 is inapplicable." Miller v. Brass Rail Tavern, Inc., 541 Pa. 474, 664 A.2d 525, 531-32 (1995).

¶ 14 Appellant Jahanshahi's testimony at trial was not "acquired or developed with an eye toward litigation." He testified:

[A]s to his experience working for various restaurants and food industry operators. He testified as to ownership interest in various restaurants including other restaurant franchises. He testified that he consulted with the

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