J-A09040-18
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
JACQUELINE C. RUPERT : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
:
v. :
:
:
THOMAS W. KING, III, ESQUIRE : No. 1309 WDA 2017
AND DILLON MCCANDLESS KING :
COULTER & GRAHAM, LLP :
Appeal from the Order August 15, 2017
In the Court of Common Pleas of Allegheny County Civil Division at
No(s): G.D. 12-007664
BEFORE: BOWES, J., DUBOW, J., and MURRAY, J.
MEMORANDUM BY MURRAY, J.: FILED JUNE 4, 2018
Jacqueline C. Rupert (Appellant) appeals from the order granting full
summary judgment in favor of Thomas W. King, III, Esquire and Dillon
McCandless King Coulter & Graham, LLP (Dillon McCandless) in this legal
malpractice action. We reverse and remand. Furthermore, we deny Attorney
King’s motion to strike references in Appellant’s brief to expert reports, as well
as Attorney King’s motion to vacate this Court’s order of January 11, 2018,
which allowed non-parties Douglas G. Linn, Esquire and The Linn Law Group
to intervene in this appeal.
As this appeal concerns the parties’ competing narratives of facts, we
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first set forth the undisputed facts.1 Appellant and Michael T. Rupert (Michael)
were married in 2002 and had an ante-nuptial agreement. On May 27, 2010,
Michael was in an automobile accident and suffered serious injuries, including
amputation of both his legs and one arm, burns over a substantial part of his
body, blindness in one eye, and the loss of his penis. The owner of the vehicle
that struck him was Brayman Construction, Inc. (Brayman), and the driver
was Brayman’s employee, Stephen Macon (Macon).
On June 1, 2010, while Michael was in a coma, Appellant met with
Attorney King, an attorney at Dillon McCandless. That same day, Attorney
King filed a successful petition in the Orphans’ Court of Butler County to
appoint Appellant as emergency guardian of Michael. Also on June 1st,
Appellant signed a contingent fee agreement with Dillon McCandless, both in
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1 As we write primarily for the trial court and the parties, we do not repeat all
of the extensive factual and procedural history of this case. We note,
however, that the underlying dispute between the parties has generated two
additional actions in the Courts of Common Pleas, and this Court has issued
three decisions: Dillon McCandless King Coulter & Graham, LLP v.
Rupert, 81 A.3d 912 (Pa. Super. 2013) (Attorney King sought declaration in
Butler County that the parties’ amended fee agreement is valid and
enforceable); Dillon McCandless King Coulter & Graham, LLP v. Rupert,
1648 WDA 2015 (unpublished memorandum) (Pa. Super. Apr. 20, 2017)
(same); Rupert v. King, 1181 WDA 2014 (unpublished memorandum) (Pa.
Super. Aug. 21, 2015) (Appellant sued Attorney King and his attorney for
abuse of process). This Court has observed, “[I]t is apparent from the tone
and substance of both parties’ briefs that significant animosity exists, not only
between the parties, but also between their counsel.” Dillon McCandless
King Coulter & Graham, LLP v. Rupert, 1648 WDA 2015 at 3.
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her individual capacity and as guardian for Michael, for Attorney King to
represent Michael and Appellant in claims arising from the accident.2 The
Original Agreement provided that Dillon McCandless would receive 33 1/3%
of any settlement, verdict, or recovery obtained by Michael and Appellant, and
that litigation costs incurred by Dillon McCandless would be deducted from the
recovery. After Michael woke from the coma, he filed a petition to remove
Appellant’s guardianship; this petition was granted on October 29, 2010.
Around the same time, Appellant and Attorney King discussed a potential loss
of consortium claim for Appellant. Appellant asked Attorney King to research
the value of her potential claim, and Attorney King engaged a company called
Verdict Search, which prepared a report on loss of consortium verdicts in
Pennsylvania.
On November 4, 2010, Appellant, Michael, and Attorney King executed
an amended contingent fee agreement (Amended Fee Agreement), which
reduced the contingency fee to 30% of any recovery, and provided that Dillon
McCandless would be responsible for litigation costs. The Amended Fee
Agreement also stated that Appellant would take 3 1/3% of any recovery as
compensation for her loss of consortium claim, that Michael’s share of any
recovery would be 66 2/3%, and that these funds “shall be the sole and
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2 In addition to Brayman and Macon, Michael and Appellant identified two
additional parties who could be liable: Ford, the manufacturer of Michael’s
F-150 truck, which had caught on fire in the accident; and another driver who
struck Michael’s truck after Macon struck it.
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independent property of each of them.” Amendment to Contingent Fee
Agreement, 11/4/10, at 1.
On December 7, 2010, without having commenced any action in court,
Michael and Appellant proceeded to mediation with Brayman. On that day,
Brayman agreed to settle and pay $19,000,000. Pursuant to the terms of the
Amended Fee Agreement, Appellant received $632,700, or 3 1/3% of the total
settlement amount. Michael returned home from the hospital on July 12,
2011, and the next day, Appellant moved out of the marital residence. On
November 11, 2011, Appellant commenced a divorce action in Butler County,
and equitable distribution in that matter has since concluded, with Michael
receiving the entire share of the Brayman settlement allocated to him.
On May 3, 2012, Appellant commenced this action against Attorney King
and Dillon McCandless, averring legal malpractice/negligence, intentional
misrepresentation, breach of contract, and breach of fiduciary duty.
Pertinently, Appellant alleged that Attorney King was presented with a conflict
of interest in representing both her and Michael and that Attorney King
misrepresented the value of her loss of consortium claim in order to induce
her to agree to the Amended Fee Agreement. On May 1, 2017, Appellant filed
a motion for partial summary judgment as to her counts of legal malpractice
and breach of fiduciary duty. Attorney King and Dillon McCandless filed a
response, and on June 15, 2017, filed a motion for summary judgment,
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seeking dismissal of Appellant’s complaint.3 Appellant filed a response. At
this juncture, we summarize the parties’ competing accounts of the facts, as
set forth in their pleadings.
Appellant’s complaint and motion for partial summary judgment averred
the following: While Michael was in a coma, Attorney King had private
meetings and communications with Michael’s father, Timothy Rupert, whom
Attorney King knew vehemently disliked Appellant, objected to her
participation in the accident litigation and potential recovery, and influenced
Michael. Shortly before the Amended Fee Agreement was executed, Attorney
King told Appellant that Michael and Timothy would not agree to any
settlement if she received any proceeds. At that point, according to Appellant,
Attorney King had a conflict of interest in representing both Appellant and
Michael, as their interests were adverse to one another, but Attorney King
failed to advise Appellant to seek independent counsel. Attorney King knew
that he could obtain a settlement with Brayman for close to $21,000,000.
Meanwhile, the Verdict Search report showed that the average Pennsylvania
verdict for loss of consortium exceeded 20% of the total award, but Attorney
King concealed this information and instead misrepresented to Appellant that
her loss of consortium claim would have little to no value. Appellant’s
Amended Complaint, 10/7/14, at 5-6. Attorney King also failed to inform
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3 For ease of discussion, we refer to all of Attorney King and Dillon McCandless’
joint pleadings, as well as their appellate brief, as filed by Attorney King.
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Appellant that her loss of consortium claim was independent from Michael’s
claims, could be litigated separately, and would be lost if she settled with
Brayman. Attorney King then proposed to reduce his fee by 3 1/3% and
allocate this difference to Appellant to satisfy her loss of consortium claim —
representing to her that this amount “was better than [what] she could obtain
by trial or settlement without Michael’s consent” — and thus Michael could
settle his claim with Brayman without having to share any of his award with
Appellant. Id. at 7. According to Appellant, Attorney King undertook these
actions to preserve the approximately $5,700,000 fee he stood to receive, all
without having to file any lawsuit against Brayman. Appellant further claimed
that Attorney King failed to inform her of the import of the clause that any
proceeds to her and Michael would remain the independent property of each.
In his response to Appellant’s summary judgment motion, Attorney King
denied that he told Appellant that Michael did not want her to receive any
portion of a settlement. In his own motion for summary judgment, Attorney
King alleged the following: Appellant and Michael appeared to be and acted as
an intact family unit, and attorneys routinely represent married couples in all
sorts of litigation without breaching any professional duty. Both Michael and
Appellant discussed with Attorney King a claim for loss of consortium, and it
was Appellant who wished to have a portion of any settlement allocated to her
in her own name. Appellant and Michael both freely executed the Amended
Fee Agreement and Appellant consented to accept 3 1/3% of any total
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settlement.
Pertinently, Attorney King’s motion also argued that Appellant’s claims
were barred by Muhammad v. Strassburger, McKenna, Messer, Shilobod
& Gutnick, 587 A.2d 1346 (Pa. Super. 1991), which bars a claim of legal
malpractice, in the absence of sufficient allegation of fraud, by a client who is
dissatisfied with the amount of a settlement entered while under the
representation of the defendant attorney.4 In response, Appellant contended
that Muhammad did not apply to this case because she was challenging the
Amended Fee Agreement, not the settlement with Brayman.
Following a hearing, the trial court denied Appellant’s motion for
summary judgment and granted in full Attorney King’s motion for summary
judgment. Significantly, the court applied Muhammad, and concluded that
the evidence would compel a jury to find, inter alia, that: Appellant knew her
claim was independent from that of Michael; Appellant and Michael presented
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4Appellant points out that the Pennsylvania Supreme Court granted allowance
of appeal on the following issue:
Should this Court overturn its decision in Muhammad v.
Strassburger, McKenna, Messer, Shilobod & Gutnick, 587
A.2d 1346 (Pa. 1991), which bars legal malpractice suits following
the settlement of a lawsuit absent an allegation of fraud, even in
instances where an attorney’s negligence led to a lesser
settlement.
Appellant’s Brief at 32, citing McGuire v. Russo, 901 MAL 2016 (alloc. order)
(Pa. June 6, 2017). We further note, however, that on August 23, 2017, the
McGuire case was discontinued upon praecipe of the plaintiff/petitioner.
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a unified marital front to Attorney King and Attorney King had no reason to
believe their interests were adverse to one another; there was no conflict of
interest in Attorney King’s representation of both Appellant and Michael; and
Attorney King did not make misrepresentations to Appellant about the
Amended Fee Agreement or settlement. Trial Court Opinion, 8/15/17, at 1-3.
Appellant timely appealed and complied with the court’s order to file a
Pa.R.A.P. 1925(b) statement of errors.
Appellant presents the following issues for our review:
1. Does Muhammad[ ] apply to a claim that [Attorney King]
committed fraud, concealed his conflict of interest, and failed to
advise [Appellant] of the import of an Amendment to Contingent
Fee Agreement he induced her to sign, but where the lower court
acknowledges she did not dispute the amount or terms of any
settlement?
2. Did the lower court err in expanding Muhammad’s scope to
include a claim where [Appellant] was fraudulently induced to sign
an Amendment to Contingent Fee Agreement months before any
settlement was reached on the basis that Muhammad precludes
any claim where there was ultimately a settlement and includes
everything within the “settlement process”?
3. Is summary judgment appropriate on a fraud claim against
[Attorney King] where [he] admitted that he did not inform
[Appellant] that a sole property clause that he inserted into an
Amendment to Contingent Fee Agreement converted [Michael’s]
settlement proceeds from marital property to non-marital
property in case of a divorce?
4. Did the trial court err in granting summary judgment against
[Appellant] on a fraud claim against [Attorney King] where she
provided evidence that [Attorney King] intentionally falsified
results from a summary of loss of consortium verdicts in
Pennsylvania, withheld an expert report evidencing that her loss
greatly exceeded the value he represented was the value of her
loss of consortium claim, and falsely informed her that whether
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she was entitled to any recovery depended on [Michael’s] consent,
all in an effort to induce her into signing an Amended to
Contingent Fee Agreement which limited her right to recovery and
protected [Attorney King’s] fee?
5. Whether a letter from a client to her attorney of record,
accusing him of fraud and malpractice, relieves a lawyer from his
obligations to her as a current and former client, before the court
permits him to withdraw his appearance?
Appellant’s Brief at 3-5.5
We address together Appellant’s first two issues, which challenge the
trial court’s application of Muhammad. Appellant maintains that Attorney
King’s summary judgment motion was based on a mistaken premise: that she
was fraudulently induced to settle her claim with Brayman. Instead, Appellant
clarifies, her claim was that Attorney King fraudulently induced her into
entering the Amended Fee Agreement. Appellant maintains that she has not
complained about the amount of the settlement with Brayman nor Attorney
King’s advice to her to settle with Brayman. Accordingly, Appellant reasons,
the trial court improperly expanded the holding in Muhammad, which
Appellant contends bars a disappointed client from attacking the amount of a
settlement that he entered into upon the advice of counsel. Appellant adds
that this case is instead governed by, inter alia, Kilmer v. Sposito, 146 A.3d
1275 (Pa. Super. 2016), which discusses Muhammad and distinguishes an
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5 The issues and corresponding argument in Appellant’s brief do not exactly
correlate to her statement of questions involved. We address Appellant’s
issues as presented in the argument section of her brief.
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attorney’s professional judgment in negotiating a settlement, from the
attorney’s failure to correctly advise a client on the law pertaining to the
client’s interests.
We note the relevant standard of review:
A proper grant of summary judgment depends upon an
evidentiary record that either (1) shows the material facts are
undisputed or (2) contains insufficient evidence of facts to make
out a prima fade cause of action or defense and, therefore, there
is no issue to be submitted to the jury. Pa.R.C.P. 1035.2 Note.
* * *
Upon appellate review, we are not bound by the trial court’s
conclusions of law, but may reach our own conclusions. In
reviewing a grant of summary judgment, the appellate Court may
disturb the trial court’s order only upon an error of law or an abuse
of discretion. The scope of review is plenary and the appellate
Court applies the same standard for summary judgment as the
trial court.
* * *
An entry of summary judgment may be granted only in cases
where the right is clear and free from doubt. The moving party
has the burden of proving the nonexistence of any genuine issue
of material fact. Further, the record must be viewed in the light
most favorable to the nonmoving party, and all doubts as to the
existence of a genuine issue of material fact must be resolved
against the moving party.
Buchleitner v. Perer, 794 A.2d 366, 369-70 (Pa. Super. 2002) (some
citations omitted).
We first consider Appellant’s claim that the trial court erred in expanding
Muhammad and applying it to this case. In Muhammad, the plaintiffs’ one-
month old son died following surgery. Muhammad, 587 A.2d at 1347. The
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plaintiffs retained the defendant/attorney to represent them in a medical
malpractice action, and eventually accepted a settlement offer from the
hospital and doctors (collectively, hospital) for $26,500. Id. Before receiving
the money, however, “for reasons unknown,” the plaintiffs believed the
amount was too little. Id. at 1348, 1349. The hospital petitioned the trial
court for a rule to show cause why the settlement agreement should not be
enforced. Id. at 1348. Following a hearing, the trial court upheld the
settlement agreement, and on appeal, the Superior Court affirmed. Id.
The Muhammad plaintiffs then filed a complaint against their former
attorney, averring, inter alia, negligence and fraudulent concealment. Id. at
1348 & n.1. On appeal, the Pennsylvania Supreme Court considered whether
the plaintiffs stated a claim for which relief could be granted.6 Id. at 1348.
The Court first extensively discussed public policy favoring settlement
agreements, and then held:
[W]e will not permit a suit to be filed by a dissatisfied plaintiff
against his attorney following a settlement to which that plaintiff
agreed, unless that plaintiff can show he was fraudulently
induced to settle the original action. An action should not lie
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6 The trial court had sustained preliminary objections against the plaintiffs’
legal malpractice action on collateral estoppel grounds, reasoning that the
settlement agreement against the hospital was upheld in court. Muhammad,
587 A.2d at 1348. The Superior Court reversed, holding that collateral
estoppel did not apply. Id. Our Supreme Court agreed, holding there were
issues in the legal malpractice case against the prior attorney that were not
litigated in the prior action against the hospital. Id. The Court then proceeded
to consider whether the plaintiffs stated a claim for which relief could be
granted. Id.
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against an attorney for malpractice based on negligence and/or
contract principles when that client has agreed to a settlement.
Rather, only cases of fraud should be actionable.
* * *
[T]here must be redress for the plaintiff who has been
fraudulently induced into agreeing to settle. It is not enough
that the lawyer who negotiated the original settlement may have
been negligent; rather, the party seeking to pursue a case against
his lawyer after a settlement must plead, with specificity, fraud in
the inducement. “One may not . . . induce another to contract by
fraudulent misrepresentations.”
Id. at 1348, 1351 (emphases added).
In Kilmer, upon which Appellant relies, the plaintiff/wife, on her
attorney’s advice, elected to take against her late husband’s will, which gave
her 1/3 of his estate. Kilmer, 146 A.3d at 1276. The wife subsequently
learned that “pure operation of law . . . would have entitled [her] to one-half
of the estate as a surviving spouse who had married the testator after he
made his will.” Id. at 1277. The wife retained new counsel and eventually
settled with the estate and agreed to take a 41.5% share. Id. The wife then
sued her former attorney, alleging professional negligence and breach of
contract for failing to correctly advise her on the law. Id. at 1277, 1279. The
trial court sustained the defendant/attorney’s preliminary objections, finding
that the claims were barred by Muhammad. Id. at 1278.
On appeal, this Court reversed, reasoning:
Muhammad . . . stands for the proposition that dissatisfied
plaintiffs may not later challenge an attorney’s professional
judgment with respect to an amount of money to be accepted in
a settlement, unless plaintiffs plead and can prove they were
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fraudulently induced to settle. As such, the Muhammad decision
is inapposite to the present action, which focuses not on [the
attorney’s] professional judgment in negotiating a settlement —
indeed, he was no longer [the wife’s] attorney when [the wife]
ultimately settled — but on his failure to advise her correctly on
the law pertaining to her interest in her late husband’s estate. The
facts of the case sub judice, therefore, take it outside the scope
of the Muhammad prohibition against second-guessing an
attorney’s judgment as to settlement amounts.
Id. at 1279.
Here, the trial court specifically rejected Appellant’s argument that
because she was not challenging the settlement with Brayman — and instead
was challenging the Amended Fee Agreement — Muhammad did not apply.
Trial Court Opinion, 8/15/17, at 1. The court reasoned:
[T]he record in this case unequivocally demonstrates that the
amended agreement was part of the settlement negotiation
process. . . . Any remaining factual differences between the
present case and Muhammad are differences without distinction,
and the Court finds that the rule expressed in Muhammad
requiring a showing a fraud applies in the present case.
Trial Court Opinion, 8/15/17, at 1-2.
Upon review, we do not agree that the record supports a finding that
the Amended Fee Agreement — which was between Appellant, Michael, and
Attorney King — was a part of the negotiation between Appellant and Michael
and Brayman. Where the Amended Fee Agreement reduced Attorney King’s
fee and shifted the costs of litigation from Appellant and Michael to Attorney
King, the negotiations leading to these changes were between Appellant,
Michael, and Attorney King. Furthermore, we agree with Appellant that this
case is governed by Kilmer. Similar to the wife in that case, Appellant is not
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challenging the underlying settlement agreement with Brayman, but instead
is alleging, inter alia, that Attorney King failed to advise her correctly on the
law pertaining to her interest in a loss of consortium claim and misrepresented
this interest in order to induce her into agreeing to the Amended Fee
Agreement. Accordingly, we hold that this matter falls outside the scope of
Muhammad. See Kilmer, 146 A.3d at 1280.
In Appellant’s third and fourth claims, she avers that in considering
Attorney King’s summary judgment motion, the trial court improperly
construed the facts in his favor. Appellant’s Brief at 48-54, citing Trial Court
Opinion, 8/15/17, at 2-3 (evidence could compel jury to find: that Attorney
King merely gave his opinion as to the value of Appellant’s claim, did not make
any misrepresentations regarding the Amended Fee Amendment, and
adequately explained to Appellant that her claim was independent from
Michael’s; and that Appellant and Michael presented a united marital front and
Attorney King had no reason to believe their interests were adverse or that
any conflict of interest existed). Appellant then sets forth her account of the
facts and argues they contradict the trial court’s findings and support her
claims.
To the extent Appellant argues this Court should credit her evidence and
hold that she has succeeded in establishing her claims, we do not make such
findings of facts. Nevertheless, we are satisfied that the allegations in
Appellant’s complaint set forth sufficient facts — without regard to their
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veracity or weight — to withstand Attorney King’s summary judgment motion.
In crediting Attorney King’s recitation of facts, the trial court erred by not
construing the record in the light most favorable to Appellant and resolving all
doubts as to a genuine issue of material fact against Appellant. See
Buchleitner, 794 A.2d at 369-70. The parties’ competing narratives of the
facts presented material issues of general fact that were not for the trial court
to reconcile on summary judgment review. Instead, “the better resolution of
this matter is to put Appellant to [her] burden of proof in further proceedings.”
See id. at 367. Accordingly, we reverse the order granting Attorney King’s
motion for summary judgment and denying Appellant’s motion for partial
summary judgment.
Appellant’s final issue concerns her attempt to obtain discovery from
Attorney King. On November 16, 2011, five days after Appellant commenced
the divorce action, her current counsel, Maurice A. Nernberg, Esquire, sent a
letter to Attorney King, which stated that Appellant had retained him relative
to the action against Brayman, and that it was Appellant’s “intent to file an
action against” Dillon McCandless for legal malpractice. Letter, 11/16/11.
Thus, the trial court held that the attorney-client relationship between
Appellant and Attorney King ended on November 16, 2011, because Attorney
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King knew upon receiving the letter that he was discharged.7 Order, 9/19/16,
citing Pa.R.Prof.C. 1.16(a)(3) (“a lawyer . . . shall withdraw from the
representation of a client if . . . the lawyer is discharged”).
On appeal, Appellant avers that this order effectively and improperly
prohibited her from “obtain[ing] any discovery beyond that date.” Appellant’s
Brief at 54. She contends that her attorney-client relationship with Attorney
King did not end until February 21, 2012, when Attorney King formally
withdrew his appearance with leave of court. Appellant argues that until
February 12, 2012, Attorney King continued to have a duty to her to not
disclose privileged information or work to her detriment. Appellant claims that
discovery after November 16, 2011, is important because after that date,
Attorney King worked with Michael and “his domestic attorney, Douglas Linn,
to further harm [her] and make it more difficult for her to pursue and prove
her claims against [Attorney] King.” Id. at 54-55.
This Court has stated:
Generally, discovery orders are deemed interlocutory and not
immediately appealable because they do not dispose of the
litigation. A non-final order may be reviewed if it is separable
from and collateral to the main cause of action, the right involved
is too important to be denied review and the question presented
is such that if review is postponed until final judgment in the case,
the claim will be irreparably lost. Pa.R.A.P. 313(b). All three
factors set forth in Rule 313 must be satisfied.
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7 The Honorable R. Stanton Wettick, Jr., issued this September 19, 2016
order. The summary judgment order was issued by the Honorable Robert J.
Colville.
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Leber v. Stretton, 928 A.2d 262, 265 (Pa. Super. 2007) (some citations
omitted).
Because we reverse the order granting summary judgment to Attorney
King and remand for further proceedings, any discovery order, at this
juncture, would be interlocutory and not immediately appealable. See id.
Appellant has presented no discussion as to whether the court’s order should
be reviewed as separable and collateral to the main cause of action under
Pa.R.A.P. 313. Accordingly, no relief is due.
Finally, we consider Attorney King’s two motions filed with this Court.
First, he asks this Court to strike references to expert reports in Appellant’s
brief. Attorney King contends that these reports, generally relating to past
loss of consortium awards in Pennsylvania and to the value of Appellant’s loss
of consortium claim against Brayman, were not a part of the record before the
trial court on summary judgment. As we have not considered the references
in our appellate review and disposition, we deny Attorney King’s motion as
moot.
In his second motion, Attorney King asks us to vacate our January 11,
2018 order which permitted Attorney Linn to intervene in this appeal. Again,
the request is moot, as our merits analysis was conducted and rendered based
on the record and independent of Attorney Linn’s intervenor status. We thus
deny this second motion.
Order granting Attorney King’s motion for summary judgment and
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denying Appellant’s motion for partial summary judgment reversed. Attorney
King’s motion to strike references in Appellant’s brief to expert reports and
motion to vacate this Court’s order of January 11, 2018 denied. Case
remanded for further proceedings. Jurisdiction relinquished.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 6/4/2018
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