Volunteer Fire Co. of New Buffalo v. Hilltop Oil Co.

• Decision Date: 06 February 1992
• Citation: 412 Pa.Super. 140,602 A.2d 1348
• Parties: VOLUNTEER FIRE COMPANY OF NEW BUFFALO v. HILLTOP OIL COMPANY and Paul Clark and Beth V. Clark. Appeal of Paul CLARK and Beth V. Clark.
• Court: Pennsylvania Superior Court

Page 1348

602 A.2d 1348

412 Pa.Super. 140

VOLUNTEER FIRE COMPANY OF NEW BUFFALO v. HILLTOP OIL COMPANY and Paul Clark and Beth V. Clark Appeal of Paul CLARK and Beth V. Clark.

Superior Court of Pennsylvania.

Argued Oct. 24, 1991.

Filed Feb. 6, 1992.

Daniel W. Stern, Harrisburg, for appellant.

Barbara A. Reynolds, Camp Hill, for appellee Volunteer Fire Co.

Before WIEAND, MONTEMURO and KELLY, JJ.

WIEAND, Judge:

In this appeal, we are asked to decide the effectiveness of a corrective deed intended by the grantor to reduce the amount of land conveyed to the grantee by an earlier deed. Subsequent grantees of the grantor contend that the lawyer who prepared the corrective deed was also the attorney for the grantee and had authority to consent to and accept the corrective deed on behalf of said grantee. The trial court, in this equity action, found that the lawyer did not have authority to consent to or accept the corrective deed on behalf of the grantee and that the corrective deed, signed only by the grantor, was ineffective to reduce the quantity of land previously conveyed. Post-trial motions were denied, and this appeal followed. After careful review, we affirm.

By deed dated August 20, 1977, and duly recorded, Hilltop Oil Company (Hilltop) conveyed to Volunteer Fire Company of New Buffalo (the fire company) a tract of land containing 1.31 acres in Watts Township, Perry County. The fire company thereafter caused a building to be constructed on the land to house firefighting equipment and also a social hall. In December, 1980, a representative of Hilltop reported to officers of the fire company that an error had been made in the description contained in the 1977 deed. Thereafter, Hilltop employed C. Joseph Rehkamp, Esquire, who had represented the fire company at the earlier closing, to prepare and record a corrective deed. Rehkamp prepared such a deed, which was executed by the grantor and duly recorded. This deed purported to move the southern property line fifty (50) feet to the north and reduce the amount of acreage to 1.07 acres. Rehkamp was paid fifty ($50.00) dollars by Hilltop for his services. On the same day, Hilltop conveyed the "recovered" tract of .24 acres to Republic Development Corporation (Republic), which, in 1985, conveyed it as part of a larger tract to Paul and Beth Clark. The disputed tract of .24 acres, it was later discovered by survey, lay only eight (8) feet from the front of the fire company's building.

The fire company then commenced an action against Hilltop for the purpose of having the corrective deed declared a nullity. Also named as defendants were the Clarks, who joined as additional defendants and filed claims against Hilltop and their immediate grantor, Republic. ¹ The trial court, after trial without jury, found that Rehkamp was not the legal representative of the fire company and did not have authority to bind the fire company to accept a smaller tract of land. Therefore, the court sustained the fire company's cause of action, decreeing that the corrective deed was a nullity and that the fire company was the fee simple owner of the disputed .24 acres.

Our limited scope of review was articulated in Palmer v. Soloe, 411 Pa.Super. 444, ----, 601 A.2d 1250, 1252 (1992) as follows:

[O]n appeal we are bound by the chancellor's findings of fact, particularly if approved by the court en banc, to the same extent as we would be bound by the factual determinations of a jury. The test in either case is whether the findings are adequately supported by the record. The chancellor's findings are entitled to particular weight in a case in which the credibility of the witnesses must be carefully evaluated, because he has had the opportunity to hear them and to observe their demeanor on the stand. Charles v. Henry, 460 Pa. 673, 334 A.2d 289 (1975).

Stauffer v. Stauffer, 465 Pa. 558, 567, 351 A.2d 236, 240 (1976); accord Weir v. Estate of Ciao, 521 Pa. 491, 556 A.2d 819 (1989) (at bench trial, it is trial court's duty to judge credibility and weigh testimony and its findings will not be disturbed absent error of law or abuse of discretion); Fuisz v. Fuisz, 386 Pa.Super. 591, 563 A.2d 540 (1989) (appellate courts are constrained by a narrow standard of review in equity matters and are bound by the trial court's determination pertaining to the credibility of the witnesses and the weight to be accorded the evidence). Thus, appellate review in these matters is limited to a determination of whether there was an error of law, and the trial court's conclusions will not be disturbed unless they are not supported by the evidence. Hostetter v. Hoover, 378 Pa.Super. 1, 547 A.2d 1247 (1988).

Id., 411 Pa. Superior Ct. at----, 601 A.2d at 1252. The Clarks, who are the appellants in this case, challenge the trial court's finding that Rehkamp did not have authority to accept the corrective deed on behalf of the fire company.

Agency "cannot be assumed from the mere fact that one does an act for another." Bross v. Varner, 159 Pa.Super. 495, 497, 48 A.2d 880, 881 (1946). Whether an agency relationship exists is a question of fact. Bolus v. United Penn Bank, 363 Pa.Super. 247, 259, 525 A.2d 1215, 1221 (1987), allocatur denied, 518 Pa. 627, 541 A.2d 1138 (1988). The party asserting an agency relationship has the burden of proving it by a fair preponderance of the evidence. Apex Financial Corp. v. Decker, 245 Pa.Super. 439, 443, 369 A.2d 483, 485 (1976). Agency is created where there exists a "manifestation by the principal that the agent shall act for him, the agent's acceptance of the undertaking and the understanding of the parties that the principal is to be in control of the undertaking." Scott v. Purcell, 264 Pa.Super. 354, 363, 399 A.2d 1088, 1093 (1979) citing Restatement (Second) of Agency, § 1(1) (1958) (Comment). Before a factfinder can conclude that an agency relationship exists and that the principal is bound by a particular act of the agent, the factfinder must determine that one of the following exists:

1) express authority directly granted by the principal to bind the principal as to certain matters; or

2) implied authority to bind the principal to those acts of the agent that are necessary, proper and usual in the exercise of the agent's express authority; or

3) apparent authority, i.e. authority that the principal has by words or conduct held the alleged agent out as having; or

4) authority that the principal is estopped to deny.

Bolus v. United Penn Bank, supra at 260, 525 A.2d at 1221.

Appellants contend that an agency existed and that Rehkamp had express authority to act on behalf of the fire company. Their contention is based on entries in the fire company's minutes of monthly meetings held prior to and after execution of the corrective deed. An entry in the minutes of a meeting on February 11, 1980, indicates that a member "will have the DA [Rehkamp] contact the trustees to straighten out problem with the deed". On June 9, 1980, the minutes indicated: "discussion about the deed took place. No motions made. Will be resolved". On August 11, 1980, an entry was made which stated: "attorney needs written statements from company to handle deed matters. Motion by [member], sec. by [member]- allow attorney to get settled deed discrepencies [sic]. Letter to be sent to Solicitor Joseph Rehkamp". An entry on September 8, 1980 indicated: "letter to Rehcamp [sic]." Finally, after the corrective deed had been executed in December of 1980, a February 9, 1981 entry contained the statement: "land deed all squared away." Furthermore, according to appellants, Rehkamp's acknowledged practice of representing both grantors and grantees in real estate transactions lends credence to their position that he was representing both Hilltop and the fire company at the time when the corrective deed was executed and recorded. Although this evidence would have supported a finding that Rehkamp was the lawyer for the fire company at the time of the corrective deed, there was evidence to the contrary.

The function of a reviewing court is to determine whether the findings of the trial court are supported by competent evidence. In holding that appellants failed to sustain its burden of proving express authority to accept a corrective deed, the trial court accepted Rehkamp's testimony that he had been retained by Hilltop and was acting solely on its behalf when he prepared and recorded the corrective deed. His testimony was supported by a letter from Hilltop's manager in which Rehkamp was requested to perform this service. The evidence was that Rehkamp had been paid a fee only by Hilltop. Rehkamp testified that he had performed no legal services for the fire company after July, 1978. Members of the fire company, some of whom were officers at the time of recording the corrective deed, testified that they had no knowledge of the corrective deed until after appellants had purchased their land from Republic and began using the disputed strip of land. They recalled no one authorizing Rehkamp to accept...