Shiner v. Moriarty

• Decision Date: 19 March 1998
• Citation: 706 A.2d 1228
• Court: Pennsylvania Superior Court
• Parties: Williard C. SHINER and Ruth M. Shiner v. Eugene P. MORIARTY (a/k/a Eugene P. Weisman) Jane E. Moriarty (a/k/a Jane E. Weisman) Nernberg & Laffey, P.C., Maurice A. Nernberg, Jr. and James R. Cooney (Two Cases). Appeal of Eugene P. MORIARTY (a/k/a Eugene P. Weisman) and Jane E. Moriarty (a/k/a Jane E. Weisman) (at 2196). Appeal of NERNBERG & LAFFEY, P.C., Maurice A. Nernberg, Jr., and James R Cooney (at 2299).

Page 1228

706 A.2d 1228

Williard C. SHINER and Ruth M. Shiner v. Eugene P. MORIARTY (a/k/a Eugene P. Weisman) Jane E.

Moriarty (a/k/a Jane E. Weisman) Nernberg &

Laffey, P.C., Maurice A. Nernberg, Jr.

and James R. Cooney (Two Cases).

Appeal of Eugene P. MORIARTY (a/k/a Eugene P. Weisman) and

Jane E. Moriarty (a/k/a Jane E. Weisman) (at 2196).

Appeal of NERNBERG & LAFFEY, P.C., Maurice A. Nernberg, Jr.,

and James R Cooney (at 2299).

Superior Court of Pennsylvania.

Argued Nov. 12, 1997.

Filed Jan. 12, 1998.

Reargument Denied March 19, 1998.

Kevin C. Harkins, Pittsburgh, for Eugene P. Moriarty and Jane E. Moriarty.

William G. Walker, Tuscon, AZ, for Willard C. and Ruth M. Shiner.

Robert L. Potter and Dennis J. Roman, Pittsburgh, for Nernberg & Laffey, P.C., Maurice A. Nernberg, Jr. and James R. Cooney.

Before JOHNSON, EAKIN and BROSKY, JJ.

JOHNSON, Judge:

Eugene P. and Jane E. Moriarty appeal from the order that denied their motions for judgments notwithstanding the verdict and for a new trial. Jane Moriarty also appeals from that portion of the order that denied her request for a remittur. Maurice A. Nernberg, Jr., James R. Cooney, and Nernberg & Laffey, P.C. ("attorney defendants") appeal from the portion of the same order that denied their motions for post-trial relief. These appeals are consolidated for our review.

This action is a later installment of the continuing legal saga involving the Moriartys (formerly named the Weismans) and the appellees, Willard C. and Ruth M. Shiner. The conflict between these parties has its genesis in a restaurant business run by Encore, Inc. A brief synopsis of the parties' dealings is in order.

The Shiners owned a restaurant called Encore in a building they owned on Walnut Street in Pittsburgh. In 1981, the business was reorganized with Eugene Moriarty becoming half-owner of a new corporation called Encore Associates, Inc. ("Encore"). This new corporation engaged in an extensive expansion of the prior restaurant enterprise at a cost of over $750,000. $600,000 of this cost was procured through a loan from the Allegheny County Industrial Development Authority (IDA), which was personally guaranteed by the Shiners and the Moriartys. The Shiners, as owners of the building, granted a new lease to Encore for a term of six years commencing on October 1, 1981, and ending September 30, 1987. The lease contained two renewal options for additional five year terms. The lease provided for the exercise of these options with the following language: "Said option shall be exercisable by written notice from Tenant to Landlord by certified mail ... at least six (6) months prior to the expiration of the original term or the renewal term." Lease, p 2, attached as Exhibit A to Shiners' Complaint, docketed Dec. 3, 1990. Encore's restaurant opened for business in late 1982 under the name "Brendan's."

In January 1985, the parties completed a negotiated buyout by the Moriartys of the Shiners' 50% ownership of Encore. Under this agreement, the Shiners received $105,000 and an agreement that the Moriartys would indemnify the Shiners for any personal liability on the IDA loan. The Shiners retained ownership of the building and no new lease was executed.

On April 21, 1987, Encore mailed the Shiners notice of its intent to renew the lease. By the above-quoted lease term, this notice was due twenty-one days earlier on March 31, 1987. The Shiners advised Encore that the option was no longer available and that it was required to vacate the premises by September 30, 1987. On July 31, 1987, Encore and the Moriartys filed a complaint in equity through its counsel, the firm of Brennan, Robins & Daley.

The equity complaint sought a preliminary and permanent injunction against the Shiners' termination of the lease and interference with Encore's possession of the premises, as well as monetary relief. The complaint alleged a lack of notice of an obligation to comply with the requirement of timely, written notice to exercise the option. An evidentiary hearing was held on September 29, 1987, before the Honorable Eugene B. Strassburger, III, who denied the request for a preliminary injunction. Judge Strassburger concluded, among other things, that the failure to renew the lease in a timely manner was a result of Encore's own negligence. Opinion of Strassburger, J., at GD 87-13537, dated October 15, 1987, at 6. Encore and the Moriartys appealed this order to the Superior Court on October 6, 1987. The trial court denied their motion for a supersedeas the following day. They subsequently requested a stay pending appeal from the Superior and Supreme Courts. This relief was denied by the Superior Court, but Justice Stephen Zappala of the Supreme Court granted a stay by an order dated October 15, 1987. On October 21, 1987, the Supreme Court rescinded the stay because of the filing of a petition in bankruptcy by Encore the day before its entry, which automatically stayed prospective legal action.

On October 5, 1987, the Shiners filed an ejectment action against Encore and confessed judgment against it pursuant to a warrant of attorney contained in the lease. A writ of execution was served the following day. Encore then filed a Petition to Open Judgment Confessed in Ejectment, relying on the same grounds as their request for an injunction in the equity complaint. The Honorable I. Martin Wekselman dismissed the petition on October 13, 1987, without requiring an answer by the Shiners. Judge Wekselman cited the lack of a showing of a colorable defense, as required to open a confessed judgment, stating that the reasoning of Judge Strassburger in his previous denial of the preliminary injunction was persuasive in determining that Encore's defense lacked merit. Opinion of Wekselman, J., at GD 87-17492, dated October 30, 1987. Encore appealed this order on October 29, 1987.

As previously indicated, Encore filed a voluntary petition in bankruptcy on October 14, 1987, triggering an automatic stay of all legal process against it. On October 22, 1987, the Shiners filed a motion seeking relief from the stay, which was opposed by Encore. United States Bankruptcy Judge Bernard Markovitz granted the Shiners relief by the order dated November 24, 1987.

The attorney defendants commenced their representation of the Moriartys and Encore on December 1, 1987.

On December 3, 1987, the attorney defendants applied to the Supreme Court for a reinstatement of its previous order granting a stay pending appeal in the equity action. The Supreme Court denied this application. Then the attorney defendants filed an application for reconsideration by the full court that was denied on December 21, 1987.

On December 9, 1987, the Moriartys and Encore filed a motion to amend their equity complaint. Judge Strassburger granted this motion, in part, allowing them to allege that the time restriction was not a condition to the exercise of the option, but rather, Encore retained the power to exercise the option during the entire lease term provided it was not in default. Contemporaneously, they renewed the request for a preliminary injunction and sought a hearing on the allegations contained in the amendment. The motion also repeated the request for a stay pending the appeal of Judge Strassburger's September 30, 1987, order. Judge Strassburger denied the latter requests. This order was appealed to the Superior Court the same day. Judge Strassburger's entire opinion, prepared pursuant to Pa.R.A.P.1925 read:

The relief sought herein was denied three times by this judge, once by Judge Wekselman of this court, twice by the Superior Court, twice by the Supreme Court and once by the Bankruptcy Court. Litigation must end at some point. It is suggested that the Superior Court impose counsel fees upon Appellants and/or their counsel.

Opinion of Strassburger, J., at GD 87-13537, dated December 10, 1987. On December 10, 1987, the Superior Court granted a stay pending appeal, but vacated the order the following day.

On December 7, 1987, Encore, through the attorney defendants, filed a petition to strike the confessed judgment in ejectment. This petition alleged that the confessed judgment, entered after the expiration of the lease, was invalid because Encore was then a holdover tenant and the lease and the warrant of attorney contained therein were no longer operative. The Honorable Ralph H. Smith, Jr., denied the petition stating that it was procedurally improper under Pa.R.A.P. 1701, which deprived the court of jurisdiction over the judgment by virtue of the prior appeal of Judge Wekselman's denial of the petition to open the same judgment. Judge Smith elaborated that the petition was meritless because the Encore's position would render the warrant for confession of judgment of possession virtually meaningless. Opinion of Ralph H. Smith, Jr., J., at GD 87-17492, dated December 15, 1987. This order was also appealed to the Superior Court. The trial court denied Encore's request for a supersedeas on December 16, 1987. The Superior Court granted a stay the following day but vacated the stay on December 18, 1987. Encore left the premises the following day. The Superior Court affirmed the orders of Judges Strassburger, Wekselman and Smith in a single Memorandum filed October 28, 1988.

Meanwhile, on December 9, 1987, Encore appealed the Bankruptcy Court's lifting of the stay. On the same day, a request to the Bankruptcy Court to stay the lifting of the stay was made and denied. The following day, Encore filed a motion for leave to assume or reaffirm the lease. The bankruptcy court denied this request on January 5, 1988. The Honorable Gustave Diamond of the United States District Court for the Western District of Pennsylvania denied a stay pending appeal, citing the expiration of the lease and Judge Strassburger's previous admonition as to the need for an end to litigation. Memorandum Order of Diamond, J., dated December 14, 1987, at 3. The Third Circuit...