Khalil v. Williams
| Decision Date | 20 July 2022 |
| Docket Number | 24 EAP 2021 |
| Citation | 278 A.3d 859 |
| Parties | Dr. Ahlam KHALIL, Appellant v. Gerald J. WILLIAMS Esquire; Beth Cole Esquire; Williams Cuker Berezofsky, LLC, Appellees |
| Court | Pennsylvania Supreme Court |
Virginia Hinrichs McMichael, Esq., Appellate Law Group LLC, for Appellant.
Tamara Chasan, Esq., James Robert Kahn, Esq., Margolis Edelstein, for Appellee.
Josh J. T. Byrne, Esq., Marshall Dennehey Warner Coleman & Goggin, PC, Philadelphia, Kathleen Diane Wilkinson, Esq., Wilson Elser Moskowitz Edelman & Dicker, LLP, Philadelphia, for Appellee Amicus Curiae Pennsylvania Bar Association.
Lauren P. McKenna, Esq., Fox Rothschild, LLP, Philadelphia, for Appellee Amicus Curiae Philadelphia Bar Association.
Joseph Ray Williams, Esq., for Appellee Amicus Curiae Allegheny County Bar Association.
OPINION
In this appeal by allowance, we consider whether Appellant's legal malpractice claims against Appellees, her former attorneys, are barred under this Court's decision in Muhammad v. Strassburger, McKenna, Messer, Shilobod & Gutnick , 526 Pa. 541, 587 A.2d 1346 (1991), in which we held that a plaintiff may not sue his attorney on the basis of the adequacy of a settlement to which the plaintiff agreed, unless the plaintiff alleges the settlement was the result of fraud. For the reasons set forth below, we hold that certain of Appellant's claims are not barred under Muhammad . Accordingly, we reverse, in part, and remand for further proceedings.
The instant case has a long and convoluted history. Appellant, Dr. Ahlam Kahlil, owned a unit in the Pier 3 Condominiums in Philadelphia. Appellant's individual unit was insured by State Farm Fire and Casualty Company ("State Farm"), and the Pier 3 Condominium Association ("Pier 3") was insured under a master policy issued by Travelers Property Casualty Company of America ("Travelers"). In May 2007, Appellant sustained water damage to her unit as a result of a leak in the unit directly above hers, which was owned by Jason and Anne Marie Diegidio. Due to the water damage, Appellant eventually moved out of her unit and stopped paying her condominium fees.
In July 2008, Appellant filed a civil action against State Farm and Travelers, alleging breach of contract and bad faith, and against the Diegidios, alleging negligence (hereinafter, the "Water Damage Case").1 A year later, Pier 3 filed a separate lawsuit against Appellant for her unpaid condominium fees and charges (hereinafter, the "Fees Case").2 In that matter, Appellant filed several counterclaims against Pier 3, asserting, inter alia , that it failed to properly maintain the common area. She also filed a joinder complaint against the Diegidios, individually and as members of the condominium board,3 and Wentworth Property Management ("Wentworth"), the company responsible for managing the building.
In April 2010, after the Water Damage Case had been listed for trial, Appellant retained Appellees Gerald J. Williams, Esq., and Beth Cole, Esq., to represent her in that case.4 In May 2011, prior to trial, Appellant reached a settlement with Travelers for $17,500. In accordance therewith, Appellant was presented with a draft of a general release which provided, inter alia , that Appellant "release[d] and forever discharge[d] the said Releasee, and the Releasee's insured, PIER 3 CONDOMINIUM (Releasee's Insured) , of and from any and all claims." Draft Release in the Water Damage Case (Reproduced Record at 82a) (emphasis original).5 Appellant, however, was unwilling to sign any release unless it contained specific language that her settlement with Travelers would not prevent her from asserting her counterclaims and joinder claims in the Fees Case. Thus, Appellant maintained that, notwithstanding Appellees’ repeated assurances that her settlement with Travelers would have no effect on her claims in the Fees Case, she refused to sign the Draft Release in the Water Damage Case.
As a result, Attorney Cole sent an email to Traveler's counsel, Monica O'Neill, Esq., proposing to include the following language: "This release does not include any claims in connection with Pier 3 Condominium Association Ahlam Khalil v. Jason Diegidio and Anne Marie Diegidio and Jane Doe and Wentworth Property Management, Philadelphia Court of Common Pleas, Docket No. 090701819." Email from Attorney Cole to Attorney O'Neill, 5/16/11 (R.R. at 76a). Attorney O'Neill replied that Travelers was Email from Attorney O'Neill to Attorney Cole, 5/16/11 (R.R. at 77a). The revised release (hereinafter, "Travelers Release"),6 identifies Appellant as the "Releasor," Travelers as the "Releasee," and Pier 3 as "Releasee's insured," and provides that Appellant:
[does] ... release and forever discharge the said Releasee, of and from any and all claims, including claims of bad faith, demands, damages, debts, dues, accounts, bonds, covenants, contracts, agreements, judgments, actions, causes of action, or suits at law or in equity, of whatsoever kind or nature arising from the incident occurring at 3 North Columbus Boulevard, Philadelphia, Pennsylvania 19106 , which has been reported to have occurred on or about May 25, 2007, as more fully described in Ahl[a]m Khalil v. The Travelers Property Casualty Company of America, Philadelphia Court of Common Pleas, Docket No. 080503145. It is acknowledged that the Releasee's insured in the applicable policy of insurance is Pier 3 Condominium.
Travelers Release at ¶ 1 (R.R. at 86a) (emphasis original).
The Travelers Release further provides that it "is made as a compromise to avoid expense and to terminate all controversy and/or claims for injuries or damages against Releasee, and Releasee's Insured, and any affiliated or related people or entities, both known and unknown, including future developments thereof, in any way growing out of or connecting with said incident." Id. at ¶ 3. Additionally, the Travelers Release states that it "shall be a complete bar to all claims or suits against Releasee, Releasee's Insured, and any affiliated or related people or entities, both known and unknown, for injuries or damages of whatsoever nature resulting from or to result from said incident." Id. at ¶ 5. Notably, the release does not contain any language limiting its application to the Water Damage Case. Further, while the Travelers Release contains what purports to be Appellant's signature, she disputes its authenticity, as discussed below.
After settling with Travelers, Appellant proceeded to trial against the remaining defendants – State Farm and the Diegidios – in the Water Damage Case. During trial, Appellant agreed to settle her claims against the Diegidios and State Farm, for $50,000 and $40,000, respectively. On May 20, 2011, the trial court, by the Honorable Frederica Massiah-Jackson, conducted a colloquy on the record, at which Appellant confirmed her agreement to the terms of the settlements, as well as Appellees’ agreement to represent Appellant in the Fees Case at no additional fee. Thereafter, the trial court marked the Water Damage Case as settled, and Attorney Cole entered her appearance in the Fees Case.
Almost immediately, Appellant changed her mind about the settlements and refused to sign releases with State Farm and the Diegidios, or accept payments from any of the defendants. As a result, Attorney Cole withdrew her appearance in the Fees Case. On September 30, 2011, the trial court held a status hearing in the Water Damage Case, during which Appellant explained that she objected to the settlements because she believed that the release she signed with Travelers would impair her counterclaims in the Fees Case, despite her attorneys’ assurances it would not. Ultimately, the trial court issued an order finding the settlements with State Farm and the Diegidios valid, and directed all defendants to pay their respective settlement amounts to the court for placement in escrow, where it currently remains. Appellant did not appeal that determination.
In April 2012, relying upon the language in the Travelers Release stating that the release barred all claims in connection with the incident that occurred in Appellant's condominium unit, Pier 3 and Wentworth moved to dismiss Appellant's counterclaims in the Fees Case. The trial court, by the Honorable George W. Overton, granted the motion, agreeing that Appellant's counterclaims were precluded by the Travelers Release. The case proceeded to a jury trial on Pier 3's claims for outstanding assessment fees, and, on July 19, 2012, the jury found in favor of Pier 3 for $109,000.
Appellant filed a motion for post-trial relief in the Fees Case, asserting, inter alia , that she entered into the Travelers Release through "unilateral mistake, mutual mistake, and/or fraud." Defendant/Counterclaim Plaintiff's Motion for Post-Trial Relief in the Fees Case, 7/30/12, at ¶ 55 (R.R. at 622a). Specifically, Appellant denied signing the Travelers Release, and claimed that the version she did sign contained a note "on the first page of the Settlement Proposal in her own handwriting that it was her understanding that the settlement proposal would in no way affect the additional claims she had against the Condominium Association and Wentworth" in the Fees Case. Id. at ¶ 29. According to Appellant, the release she signed contained the following language at the bottom of the first page, marked by an asterisk: "This release does not include any claims in connection with Pier 3 Condominium Association vs. Ahlam Khalil v. Jason Diegidio and Anne Marie Diegidio and Jane Doe and Wentworth Property Management, Philadelphia Court of Common Pleas, Docket No. 090701819." Unsigned Release with...
To continue reading
Request your trial
-
Aita v. NCB Mgmt. Servs.
...only in cases where the record contains no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law." Id. (citation omitted). Both the court and the reviewing court must "view the record in the light most favorable to the nonmoving party, and all doubt......
-
Wilmer v. Salkind
...in cases where the record contains no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. See id.; also Pa.R.C.P. 1035.2. The moving party has the burden of demonstrating the absence of any issue of material fact, and the trial court must evaluat......