J-A05034-15
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
SMASH PA, INC., IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellant
v.
LEHIGH VALLEY RESTAURANT GROUP,
INC. AND BARLEY SNYDER, LLP,
Appellees No. 1811 EDA 2014
Appeal from the Order Entered May 28, 2014
In the Court of Common Pleas of Lehigh County
Civil Division at No(s): 2013-C-4389
BEFORE: GANTMAN, P.J., SHOGAN, and ALLEN, JJ.
MEMORANDUM BY SHOGAN, J.: FILED APRIL 14, 2015
Appellant, Smash PA, Inc. (“Smash”), appeals from the grant of
preliminary objections and the dismissal of its action. We affirm.
Smash, a Pennsylvania corporation with its principal place of business
in Berks County, Pennsylvania, filed suit on December 21, 2012, in
Philadelphia County by writ of summons1 against Appellees, Lehigh Valley
Restaurant Group, Inc. (“LVRG”), a Pennsylvania corporation with its
principal place of business in Lehigh County, Pennsylvania, and LVRG’s
counsel, Barley Snyder, LLP (“Barley Snyder”), a Pennsylvania limited
partnership with its principal office in Lancaster, Pennsylvania. Second
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1
The writ was filed two days before the expiration of the statute of
limitations. N.T., 3/24/14, at 9.
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Amended Complaint, 7/8/13, at ¶¶ 2, 3, 5. Smash was established “for the
sole purpose of engaging in the business of opening Smashburger
Restaurants, as a franchisee of the company Smashburger, Inc.” Id. at ¶ 8.
LVRG is a franchisee of Red Robin Gourmet Burgers, Inc. and operates
multiple Red Robin Gourmet Burgers restaurants in south central
Pennsylvania. Id. at ¶ 4; N.T., 3/24/14, at 4. LVRG and a former
employee, James M. Mitich (“Mitich”), were embroiled in litigation beginning
in October 20, 2010. The action was transferred to Lehigh County on
December 4, 2013, as a result of preliminary objections to the original
complaint. N.T., 3/24/14, at 6.
LVRG had employed Mitich since December 30, 1999, most recently as
its president and chief operating officer. N.T., 3/24/14, at 4. Mitich’s
employment agreement provided that Mitich could be terminated for cause,
and it included a non-compete clause that prohibited Mitich from working for
a restaurant similar to the Red Robin Gourmet Burgers Restaurants operated
by LVRG within a fifty-mile radius for one year. Id. at 4–5; LVRG Status
Conference Memorandum, 3/6/14, at 1. LVRG terminated Mitich effective
July 26, 2010. N.T., 3/24/14, at 4–5; LVRG Status Conference
Memorandum, 3/6/14, at 1. LVRG subsequently learned that Mitich had
become associated with Smashburger, a restaurant concept that allegedly
would compete with LVRG. On December 23, 2010, LVRG, through Barley
Snyder, sent Edward Graefe, the chief executive officer of Smash, a letter
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indicating that LVRG would pursue legal claims against Smashburger, Inc. if
Smash continued its consulting relationship with Mitich. N.T., 3/24/14, at 5;
Smash Status Conference Memorandum, 3/6/14, at 2. Shortly thereafter,
Mr. Graefe responded that Mitich no longer was affiliated with Smash. N.T.,
3/24/14, at 5. “As a result of being wrongfully forced into ending its
relationship with Mitich and, in turn, rescinding its agreements with
Smashburger,” Smash was unable to open the planned Smashburger
restaurants and thus, brought the underlying action against LVRG and its
attorneys for tortious interference with contractual relationships and civil
conspiracy. Smash Status Conference Memorandum, 3/6/14, at 2.
On January 18, 2013, copies of the writ of summons were delivered by
courier to LVRG at its corporate headquarters in Lehigh County and to
Barley Snyder at its office in Lancaster County. N.T., 3/24/14, at 6. On
January 23, 2013, Smash filed affidavits of service with the lower court. On
March 18, 2013, following a case management conference on March 15,
2013, the Philadelphia Common Pleas Court ordered Smash to file its
complaint, which it mailed on April 19, 2013, alleging tortious interference
with contractual relationships, defamation, invasion of privacy by false light,
and civil conspiracy. Id. Each Appellee filed preliminary objections (“POs”)
on May 9 and 10, 2013, respectively, averring, inter alia, that the writ of
summons had been served via courier and messenger and had not been
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served by “deputized service” by the Sheriffs of Lancaster and Lehigh
Counties in accordance with Pa.R.C.P. 400.1.
On May 28, 2013, Smash filed a praecipe to reissue the writ of
summons and an amended complaint withdrawing its cause of action for
defamation. Appellees again filed POs on June 17, 2013. On July 8, 2013,
Smash filed a second amended complaint withdrawing its cause of action for
invasion of privacy and raising only two claims: tortious interference with
contractual relations and civil conspiracy. Appellees filed the instant POs on
July 26, 2013, asserting that because the original writ of summons and
complaint had not been served properly when filed, and the amended
complaint was not served until May 31, 2013, Smash’s claims were barred
by the applicable two-year statutes of limitations.
On September 3, 2013, the Philadelphia Common Pleas Court
sustained POs of Appellees as to venue only and transferred the case to
Lehigh County, reserving all other POs for the Lehigh County Court of
Common Pleas. Following the transfer, the trial court herein granted
Appellees’ POs and struck the second amended complaint as untimely and
improper. The propriety of this final order is the subject of our review.
Smash raises the following two issues on appeal to this Court:
1. In a claim alleging tortious interference with existing
contractual relations, where (a) the Writ of Summons
against the Defendants Below was filed within the
applicable statute of limitations, (b) Smash PA made a
good faith, albeit inadequate under the applicable Rules of
Civil Procedure, attempt to serve the initiating pleading in
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a timely manner, (b) Smash PA did, in fact, provide actual
notice of the suit by hand delivery of the Writ of Summons
to both Defendants Below within thirty (30) days of the
issuance of the Writ, (c) the Defendants Below collectively
participated in the matter by having their legal
representative attend the initial scheduling conference
after the Writ of Summons was delivered to them, (d)
proper service of a Complaint was effectuated thereafter,
and (e) no prejudice for the delayed proper service to
either of the Defendants Below was claimed or found to be
present by the court below, did the lower court err as a
matter of law in granting the Preliminary Objections filed
by each of the Defendants Below to the Second Amended
Complaint filed by Smash PA and thereby dismissing all
claims therein on the basis that proper service was not
made within the statutorily allowed time period?
2. Where the controlling allegations contained in the Second
Amended Complaint clearly stated that the law firm of
Barley Snyder was acting for its own nefarious purpose as
well as the improper purpose of its client, did the court
below err as a matter of law when it dismissed Count II of
the Second Amended Complaint (Conspiracy) on the basis
of an unsupported, and unsupportable at this juncture in
the proceedings, factual finding that the law firm Barley
Snyder was acting solely as the agent of LVRG and was not
acting in furtherance of its own unlawful motive when it
sent the letter alleged to have been the basis of the
tortious interference with a contract Smash PA had with a
third party?
Smash’s Brief at 2–3 (verbatim).
Our standard of review of an order granting preliminary objections is
to determine whether the trial court committed an error of law.
When considering the appropriateness of a ruling on preliminary
objections, the appellate court must apply the same standard as
the trial court.
Preliminary objections in the nature of a
demurrer test the legal sufficiency of the complaint.
When considering preliminary objections, all material
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facts set forth in the challenged pleadings are
admitted as true, as well as all inferences reasonably
deducible therefrom. Preliminary objections which
seek the dismissal of a cause of action should be
sustained only in cases in which it is clear and free
from doubt that the pleader will be unable to prove
facts legally sufficient to establish the right to relief.
If any doubt exists as to whether a demurrer should
be sustained, it should be resolved in favor of
overruling the preliminary objections.
Shafer Elec. & Const. v. Mantia, 67 A.3d 8, 10–11 (Pa. Super. 2013).
“[A]ll material facts set forth in the complaint as well as all inferences
reasonably deducible therefrom are admitted as true for the purpose of
review.” Com., Office of Atty. Gen. ex rel. Corbett v. Locust Tp., 968
A.2d 1263, 1269 (Pa. 2009).
Smash asserts that the original writ of summons in this matter, as
filed on December 21, 2012, occurred before the statute of limitations on
Smash’s actions had expired. Significantly, Smash acknowledges that its
service of the original writ was deficient, but maintains that it made a
“good-faith effort” to serve the original writ, “giving [Appellees] actual notice
of the fact and nature of the action within thirty days of the date the original
Writ was issued.” Smash’s Brief at 10. The crux of its argument is that
because the writ was reissued and the complaint eventually was served
properly on both Appellees, “the date of filing of this action relates back to
the date the original Writ was issued,” which was December 21, 2012, and
therefore, its claims were timely filed. Id.
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LVRG refers to Pa.R.C.P. 400.1 and emphasizes that service was
required by a sheriff of Lehigh County. Here, Smash purported to serve the
writ on LVRG by a non-deputized process server. Noting that it could not
raise the service issue to the writ until the complaint was filed, LVRG
contends that it preserved its argument regarding improper service when it
filed its POs.2 Therefore, LVRG maintains that Smash failed to properly
serve LVRG within the statute of limitations, and further, LVRG would be
prejudiced by the allowance of this late assertion of claims. Thus, it argues
the order granting POs should be affirmed.
Appellee Barley Snyder asserts that since the original process—the
writ—was not properly served, Smash’s subsequent delivery of the complaint
by mail also constituted improper service. Because Smash’s service of the
writ was improper, Barley Snyder continues that Smash’s complaint would
constitute the original process in this matter, and as such, it, likewise, was
improperly served by mail. Thus, it similarly argues the order granting POs
should be affirmed.
Here, the action was commenced in Philadelphia County, and the writ
of summons was served on Appellees by courier. Pa.R.C.P. 400.1 sets forth
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2
LVRG thus distinguishes Korman Commercial Props. v. Furniture.com,
LLC, 81 A.3d 97 (Pa. Super. 2013), and Cox v. Hott, 371 A.2d 921, 923
(Pa. Super. 1977), where the failure to raise POs waived a challenge to
improper service and validated the otherwise defective form of service.
Here, by contrast, LVRG asserts that it timely objected to the complaint on
the ground that the original writ was never properly served.
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provisions for service of original process for courts of the First Judicial
District, which the rule defines as Philadelphia County. The Rule provides, in
pertinent part, as follows:
Rule 400.1. Provisions for all Courts of the First Judicial
District
(a) In an action commenced in the First Judicial District,
original process may be served
(1) within the county by the sheriff or a competent
adult, or
(2) in any other county by deputized service as
provided by Rule 400(d) or by a competent
adult forwarding the process to the sheriff of
the county where service may be made.
Note: See Rule 76 for the definition of “competent adult”.
The First Judicial District is comprised of Philadelphia County.
Pa.R.C.P. 400.1. The rules of civil procedure define “competent adult” as
“an individual eighteen years of age or older who is neither a party to the
action nor an employee or a relative of a party.” Pa.R.C.P. 76.3 As
Appellees were outside of Philadelphia County, Pa.R.C.P. 400.1(a)(2) is
relevant, and thus, service by courier did not constitute proper service.
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3
Pa.R.C.P. 400(b) defines the types of cases where service by a competent
adult is permitted, as follows: a civil action requesting injunctive relief
under Pa.R.C.P. 1531, perpetuation of testimony under Pa.R.C.P. 1532, or
appointment of a receiver under Pa.R.C.P. 1533, a request for partition, and
declaratory judgment when declaratory relief is the only relief sought.
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In granting POs in this case, the trial court underscored that the writs
filed by Smash were to be served by original process and therefore, service
was required to satisfy Pa.R.C.P. 400.1. “Service by courier did not
constitute proper service.” Trial Court Opinion, 5/28/14, at 3. Further, “in
that there was a defect in original process, the subsequent delivery of the
Complaint by mail was improper service. More importantly, the defective
service did not toll the statute of limitations.” Id.
We agree with the trial court. We find guidance in McCreesh v. City
of Philadelphia, 888 A.2d 664 (Pa. 2005), wherein our Supreme Court
revisited Pennsylvania case law regarding defects in service and the
establishment of a “good faith” effort to effectuate service. McCreesh
relaxed the required strict adherence to service by allowing that where a
plaintiff “has satisfied the purpose of the statute of limitations by supplying a
defendant with actual notice,” noncompliance with the rules of civil
procedure could be excused, although a plaintiff still bore the burden of
establishing that it made a good-faith effort to serve process. Id. at 674.
Before McCreesh, there was inconsistent application of Lamp v. Heyman,
366 A.2d 882 (Pa. 1976), and Farinacci v. Beaver County Industrial
Development Authority, 511 A.2d 757 (Pa. 1986), by trial and
intermediate appellate courts. As McCreesh explained, some decisions
required “plaintiffs to comply strictly” with civil procedural rules relating to
service of process and local practice in order to satisfy the good faith
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requirement, while others provided a more flexible approach “excusing
plaintiffs’ initial procedurally defective service . . . .” McCreesh, 888 A.2d
at 666. McCreesh adopted the more flexible approach when it was clear
that the defendant had actual notice of the commencement of litigation and
was not otherwise prejudiced. Id.
McCreesh reiterated that whether a plaintiff acted in good faith is “in
the sound discretion of the trial court.” McCreesh, 888 A.2d at 672.
Moreover, in McCreesh, the defective but good-faith service was
accomplished before the expiration of the statute of limitations. In the
instant case, Smash’s defective service was attempted after the statute of
limitations expired. Thus, unlike in McCreesh, Appellees herein did not
have actual notice, and allegedly were unaware, that litigation was
commenced until after the statute of limitations expired.
We stated in Englert v. Fazio Mechanical Services, 932 A.2d 122
(Pa. Super. 2007), that even when a lawsuit is commenced within the
statutory limits, “the statute of limitations is tolled only if the plaintiff then
makes a good faith effort to effectuate service.” Id. at 124. Moreover,
“simple neglect and mistake,” or “conduct that is unintentional that works
to delay the defendant’s notice of the action may constitute a lack of good
faith on the part of the plaintiff.” Id. at 124–125 (quoting Devine v. Hutt,
863 A.2d 1160, 1168 (Pa. Super. 2004) (emphasis added)). “Lack of
knowledge, mistake or misunderstanding does not toll the running of the
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statute of limitations.” Booher v. Olczak, 797 A.2d 342, 345 (Pa. Super.
2002).
In Englert, this Court analyzed McCreesh’s holding that a plaintiff’s
claims could be dismissed, inter alia, where the plaintiff’s failure to comply
with the rules of civil procedure prejudiced the defendant. McCreesh, 888
A.2d at 674. In Englert, as here, the plaintiffs did not provide the
defendants with actual notice of the commencement of the action within the
applicable statute of limitations. The defendants therein “had only notice
that there was a potential for litigation, which is not the same and cannot
suffice.” Englert, 932 A.2d at 127 (citing McCreesh, 888 A.2d at 224
n.17).
As in Englert, we discern no abuse of discretion by the trial court in
the case sub judice. The trial court explained:
Under Pa.R.C.P. 401(b)(5), “if an action is commenced by
writ of summons and a complaint is thereafter filed, the plaintiff
instead of reissuing the writ may treat the complaint as
alternative original process and as the equivalent for all purposes
of a reissued writ, reissued as of the date of the filing of the
complaint. Thereafter the writ may be reissued, or the
complaint may be reinstated as the equivalent of a reissuance of
the writ, and the plaintiff may use either the reissued writ or the
reinstated complaint as alternative original process.” This rule of
law is entirely applicable to these facts. Smash filed their Writ
on December 21, 2012. That Writ was improperly served on
January 18, 2013. Thereafter Smash filed their Complaint on
April 19, 2013, this was also served improperly. Therein,
original process had not been served. Furthermore, Smash did
not reissue their Writ or correctly reinstate their complaint within
the applicable Statute of Limitations period. Ultimately, it was
not until May 28, 2013, that LVRG and Barley were properly
served process under the Pa.R.C.P., which, consequently, came
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after the Statute of Limitations had expired. As a result,
jurisdiction did not attach to Defendants. See Cintas Corp. v.
Lee’s Cleaning Servs, 700 A.2d 915, 917-918 (Pa. 1997)
(without original process, a court lacks personal jurisdiction over
a defendant and is powerless to enter judgment against it).
Furthermore, “procedural rules relating to service of process
must be strictly followed because jurisdiction of the person of the
defendant cannot be obtained unless proper service is made.”
Beglin v. Stratton, 816 A.2d 370, 373 (Pa.Cmwlth. 2003).
Despite this, Plaintiff argued that they made a good faith
effort to serve legal process for the purposes of tolling the
statute of limitations. The statute of limitations is tolled only if
Plaintiff makes a good faith effort to effectuate service of process
on the opposing party. Englert v. Fazio Mechanical Services,
Inc., 932 A.2d 122 (Pa. Super. 2007). Again, under our facts,
the Plaintiff did not timely reinstate the writ in order to preserve
the action for purposes of the statute of limitations.
Furthermore, process must be immediately and continually
reissued until service is effectuated. Witherspoon v. City of
Philadelphia, 768 A.2d 1079 (Pa. 2001). Ultimately, Plaintiff has
failed in this aspect of their good faith effort.
Furthermore, as is mentioned above, the Defendants were
not properly served under Pa.R.C.P. 400.1. Significantly, Smash
commenced this action in Philadephia County against LVRG and
Barley. However, LVRG is located and was served by courier in
Lehigh County; while Barley is located and was served by courier
in Lancaster County.
Trial Court Opinion, 5/28/14, at 4–5.
We discern no error or abuse of discretion in the trial court’s
conclusion that Smash’s service of both the writs and complaint was
defective, and defective service was attempted after the expiration of the
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statute of limitations. Accordingly, there is no basis to disturb the trial
court’s grant of preliminary objections and dismissal of the action.4
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 4/14/2015
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4
Due to our resolution of this issue, we need not address Smash’s second
issue regarding the viability of Count II in the second amended complaint.
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