J-A23038-18
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
JOSEPH BARAN IN THE SUPERIOR COURT
OF PENNSYLVANIA
Appellant
v.
GEORGE WESTON BAKERIES, INC., AND
GEORGE WESTON BAKERIES
DISTRIBUTION, INC.
Appellees No. 380 WDA 2018
Appeal from the Judgment Entered March 12, 2018
In the Court of Common Pleas of Allegheny County
Civil Division at No.: GD-08-21117
BEFORE: BOWES, SHOGAN, and STABILE, JJ.
MEMORANDUM BY STABILE, J.: FILED JANUARY 7, 2019
Appellant Joseph Baran appeals from the March 12, 2018 judgment
entered in the Court of Common Pleas of Allegheny County (“trial court”)
against him and in favor of Appellees George Weston Bakeries, Inc., and
George Weston Bakeries Distribution, Inc. (hereinafter, “Weston”) following
the denial of his post-trial motions seeking judgment notwithstanding the
verdict (“JNOV”). Upon review, we affirm.
The facts and procedural history of this case are undisputed.1 In 1999,
Appellant entered into an exclusive distribution agreement (the “Agreement”)
____________________________________________
1 Unless otherwise specified, some background facts are taken from the June
9, 2010 memorandum issued by a prior panel of this Court. See Baran v.
George Weston Bakeries, Inc., 4 A.3d 681 (Pa. Super. Filed June 9, 2010)
(unpublished memorandum).
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with Weston’s predecessor company, whereby he agreed to use his best
efforts to sell the company’s fresh-baked products along his route, designated
as “sales area #1269” (the “Route”). In return, he received a twenty percent
commission on those sales.
In 2008, Weston sent Appellant a letter terminating the Agreement
based on numerous perceived violations of the Agreement over the years.
Although Appellant still owned the Route and received income from it, Weston
assumed control and operation of the Route after termination. Weston
operated the Route by hiring temporary drivers. Soon thereafter, Weston
expressed its intention to sell the Route at a fair market price on Appellant’s
behalf.
Appellant subsequently filed the instant civil complaint against Weston,
asserting breach of contract, breach of implied covenant of good faith and fair
dealing, tortious interference with advantageous business relationships, and
civil conspiracy. Appellant also sought relief in the form of punitive damages,
as well as a preliminary injunction to enjoin Weston’s sale of his distribution
rights in the Route and to reinstate him as Weston’s independent operator of
the Route.
Following a hearing, on February 12, 2009, the trial court granted a
preliminary injunction. The trial court concluded that although it was not
persuaded to issue an injunction requiring Weston to reinstate Appellant as
the Route’s operator, it found reasonable grounds to issue an injunction
prohibiting Weston from selling Appellant’s exclusive distribution rights in the
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Route until the matter could be fully adjudicated. On appeal, we affirmed the
trial court’s issuance of the preliminary injunction in Appellant’s favor. See
Baran, supra.
On June 14, 2013, Weston filed a motion for partial summary judgment,
arguing that Appellant was not entitled to recover lost profits under the
Agreement, which was governed by New York law. Following Appellant’s
response, the trial court granted Weston’s motion for partial summary
judgment on November 21, 2014.
The case eventually proceeded to a bench trial, after which the trial
court made the following factual findings:
In 1962, at the age of five, [Appellant] began working in the
bread industry by delivering bread door to door with his father.
By 1985, [Appellant] owned a delivery truck and was an
independent contractor for Bestfoods Baking Distribution
Company (“Bestfoods”) delivering bread and other similar
products to grocery stores in the West Mifflin area. In 1999,
Bestfoods and [Appellant] entered into [the Agreement] for
[Appellant] to distribute premium products, such as Thomas’®
English muffins and Brownberry® breads. The Agreement made
[Appellant] the exclusive distributor of those products in the West
Mifflin and Homestead areas. In approximately 2004, [Weston]
acquired Bestfoods, including the rights and duties under the
[A]greement with [Appellant].
Around this time, significant changes affecting [Appellant’s]
distribution area were taking place. The large “Waterfront”
shopping district along the Monongahela river opened in the
Homestead area, and nationwide retailers located in the
distribution area, including Walmart, Target and Sam’s Club,
increased their sales of foods. To accommodate these changes,
Weston believed that [Appellant] needed to change his delivery
methods. Weston suggested that [Appellant] have a family
member or an employee assist him, or that he “split his route” by
selling a portion of the distribution area to another independent
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operator. [Appellant], believing these suggestions would reduce
his income, declined to implement them or any other change in
his delivery methods.
In 2006, 2007, and 2008 Weston sent [Appellant] eight
letters that specified conduct by him that breached the
[A]greement and allowed him three days to cure the breaches. In
July 2008, after a Walmart serviced by [Appellant] removed
Weston’s shelf space in the deli section of the store and
reallocated it to a competitor, Weston notified [Appellant] the
[A]greement was terminated. Weston instructed [Appellant] to
sell his distribution rights to a qualified purchaser within ninety
days, with Weston operating [Appellant’s] business, for his
account, pending the sale.
Trial Court Opinion, 5/14/18, at 1-2. Based on the foregoing findings, the trial
court found in favor of Weston, dissolved the February 12, 2009 preliminary
injunction, and denied Appellant’s request for a permanent (mandatory)
injunction. The trial court concluded that Appellant “repeatedly breached
Section 4.1 of the [Agreement]” and “never cured many of the breaches,
which under Section 8.3 ‘constitute a chronic breach and threaten significant
harm to [Weston], its trademarks or commercial reputation.’” Trial Court
Order, 12/11/17, at ¶ 2. Given Appellant’s breaches, the trial court concluded
that Weston “was entitled to terminate the [A]grement.” Id. at ¶ 3.
Appellant timely filed post-trial motions, seeking JNOV or a new trial.
Specifically, Appellant argued that “the evidence produced at trial by both
[Appellant] and [Weston] clearly establishes there were no repeated breaches
under Section 4.1 of the [Agreement] which constituted a chronic breach.”
Post-trial Motion, 12/17/17, at ¶ 1. Following a hearing, the trial court denied
Appellant post-trial relief on February 20, 2018. On March 12, 2018, the trial
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court’s verdict was reduced to judgment. Appellant appealed to this Court.
The trial court directed Appellant to file a Pa.R.A.P. 1925(b) statement of
errors complained of on appeal. Appellant complied, raising two assertions of
error. In response, the trial court issued a Pa.R.A.P. 1925(a) opinion.
On appeal, Appellant presents two issues for our review:
[I.] Whether the lower court abused i[t]s discretion and
committed an error of law in ruling that [Appellant] had breached
the contract in question.[2]
[II.] In the second appealable issue [Appellant] suggests the
lower court abused its discretion and committed an[] error of law
when it ruled that lost profits were not recoverable in this instant
action because they were not permitted by paragraph 11.12 of the
contract at issue.
Appellant’s Brief at 3.3
Our scope and standard of review of these claims is well-defined.
Our appellate role in cases arising from non-jury trial verdicts is
to determine whether the findings of the trial court are supported
by competent evidence and whether the trial court committed
error in any application of the law. The findings of fact of the trial
judge must be given the same weight and effect on appeal as the
verdict of a jury. We consider the evidence in a light most
favorable to the verdict winner. We will reverse the trial court
only if its findings of fact are not supported by competent evidence
in the record or if its findings are premised on an error of law. We
will respect a trial court’s findings with regard to the credibility
____________________________________________
2 The first question presented is inartfully phrased. In his brief, Appellant does
not contest that he breached the Agreement. Rather, he argues that he cured
his breaches and, as a result, Weston should not have been permitted to
terminate the Agreement.
3 Because our resolution of Appellant’s first issue is dispositive, we need not
address his second issue pertaining to trial court’s grant of partial summary
judgment in favor of Weston on the issue on damages. The trial court found
against Appellant on his claim for breach of contract.
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and weight of the evidence unless the appellant can show that the
court’s determination was manifestly erroneous, arbitrary and
capricious or flagrantly contrary to the evidence.
J.J. DeLuca Company, Inc. v. Toll Naval Associates, 56 A.3d 402, 410
(Pa. Super. 2012) (quotation marks, formatting, and citations omitted).
Our standard of review of a trial court’s denial of a request for a
permanent injunction is well-settled: “[W]hen reviewing the grant or denial of
a final or permanent injunction, an appellate court’s review is limited to
determining whether the trial court committed an error of law.” Buffalo Twp.
v. Jones, 813 A.2d 659, 663–64 (Pa. 2002).
Ultimately, the grant or denial of a permanent injunction will turn
on whether the trial court properly found that the party seeking
the injunction established a clear right to relief as a matter of law.
Accordingly, we think it proper that appellate review in these
cases is whether the lower court committed an error of law in
granting or denying the permanent injunction. Our standard of
review for a question of law is de novo. Our scope of review is
plenary.
Id. at 664 n.4 (citations omitted).
It is settled that because contract interpretation is a question of law, our
review of the trial court’s decision is de novo and our scope of review plenary.
Bair v. Manor Care of Elizabethtown, PA, LLC, 108 A.3d 94, 96 (Pa. Super.
2015), appeal denied, 125 A.3d 775 (Pa. 2015).
The fundamental rule in interpreting the meaning of a contract is
to ascertain and give effect to the intent of the contracting parties.
The intent of the parties to a written agreement is to be regarded
as being embodied in the writing itself. The whole instrument
must be taken together in arriving at contractual intent. Courts
do not assume that a contract’s language was chosen carelessly,
nor do they assume that the parties were ignorant of the meaning
of the language they employed. When a writing is clear and
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unequivocal, its meaning must be determined by its contents
alone.
Only where a contract’s language is ambiguous may extrinsic or
parol evidence be considered to determine the intent of the
parties. A contract contains an ambiguity if it is reasonably
susceptible of different constructions and capable of being
understood in more than one sense. This question, however, is
not resolved in a vacuum. Instead, contractual terms are
ambiguous if they are subject to more than one reasonable
interpretation when applied to a particular set of facts. In the
absence of an ambiguity, the plain meaning of the agreement will
be enforced. The meaning of an unambiguous written instrument
presents a question of law for resolution by the court.
Ramalingam v. Keller Williams Realty Group, Inc., 121 A.3d 1034, 1046
(Pa. Super. 2015) (citation and original emphasis omitted).
Instantly, the Agreement in pertinent part provides as follows:
ARTICLE 4
DISTRIBUTOR’S OBLIGATIONS
§4.1. RESULTS: In order to maximize its purchase from
[Weston], [Appellant] agrees to develop and maximize sales of
Products to Outlets within the Sales Area by maintaining an
adequate and fresh supply of Products in all Outlets; rotating
Products to promote their sale before they become stale or off
code; promptly removing all stale or off code Products;
cooperating with [Weston] or its affiliates in its marketing
programs, maintaining a computer assisted record-keeping
system compatible with the system maintained by [Weston] now
or in the future; and providing service on a basis consistent with
good industry practice to all Outlets in the Sales Area requesting
service.
....
ARTICLE 8
TERMINATION
....
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§8.3 CURABLE BREACH: In the event of breach by [Appellant]
other than under §8.2 [(non-curable breach)], [Weston] shall give
[Appellant] three (3) business days written notice within which
[Appellant] may cure the breach. If [Appellant] fails to cure such
breach within said three (3) day period, [Weston] may thereafter
terminate this Agreement and [Appellant] shall have no further
right to cure; provided, further, that the parties agree that
repeated violations constitute a chronic breach and threaten
significant harm to [Weston], its trademarks or commercial
reputation, and in such event [Weston] shall be entitled to
terminate this Agreement pursuant to §8.2 and [Appellant] shall
have no further right to cure.
The Agreement, 11/15/99, at 6, 13.
Based on the foregoing provisions, Appellant argues that the trial court
erred in concluding that he failed to cure his breaches of the Agreement. In
support, Appellant points out that Ricky Saxon, a Weston representative who
terminated Appellant, testified that Appellant had cured the breaches.
Appellant’s Brief at 8-9.4 We disagree.
Here, the trial court expressly found that Appellant’s repeated violations
of the Agreement constituted a chronic breach sufficient to permit Weston to
terminate the Agreement under Section 8.3. As the trial court explained:
[Appellant] failed to cure at least four different breaches. After
notice, [Appellant] admitted he did not deliver fresh baked
products to Target three days a week and Sam’s Club four days a
week. There also was no dispute that, after notice, [Appellant]
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4 To the extent Appellant attempts to undermine Mr. Saxon’s trial testimony
using Mr. Saxon’s preliminary injunction testimony, such issue is waived
because Appellant failed to do so in the trial court in the first instance. See
Pa.R.A.P. 302(a) (“Issues not raised in the lower court are waived and cannot
be raised for the first time on appeal.”). Appellant also may not rely on the
preliminary injunction transcript because it is not part of the certified record.
See Commonwealth v. Kennedy, 868 A.2d 582, 593 (Pa. Super. 2005)
(noting that “this Court may not consider anything that is not part of the
certified record[.]”).
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was unable to get Walmart to replace either Weston’s 4-sided
sales display in the front of the store or its shelf in the deli section.
Under the [Agreement], each of these uncured breaches was a
sufficient reason for termination. These four breaches, plus
additional breaches involving a Giant Eagle and a Shop N Save
that may have been cured, also are repeat violations under the
[Agreement] sufficient for termination. Therefore, there was
sufficient evidence for [the trial court’s] ruling in favor of Weston,
and the ruling was not against the weight of the evidence.
Trial Court Opinion, 5/14/18, at 4 (record citations omitted). As stated,
Appellant himself admitted at trial that he did not cure the breaches. See
N.T. Trial, 11/1-2/17, at 85 (admitting that after receiving notice to cure, he
failed to service Sam’s Club four days per week and Target three days per
week); Id. at 143-144 (admitting that he lost the 4-sided display because of
his failure to keep it adequately stocked); Id. at 157-160 (admitting that he
lost the shelf space in the Walmart deli because of his failure to keep it
adequately stocked).
Insofar as Mr. Saxon’s trial testimony, Appellant essentially is inviting
us to substitute our judgment for that of the trial court by accepting
Appellant’s proffered version of the facts. We decline the invitation. As noted
earlier, in a nonjury trial, the trial court sitting as the finder of fact is free to
believe all, part, or none of the evidence, and this Court will not disturb the
trial court’s credibility determinations. Voracek v. Crown Castle USA Inc.,
907 A.2d 1105, 1108 (Pa. Super. 2006), appeal denied, 919 A.2d 958 (Pa.
2007). “The trial court’s findings are especially binding on appeal, where they
are based upon the credibility of the witnesses, unless it appears that the court
abused its discretion or that the court’s findings lack evidentiary support or
that the court capriciously disbelieved the evidence.” Shaffer v. O'Toole,
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964 A.2d 420, 422–423 (Pa. Super. 2009), appeal denied, 981 A.2d 220 (Pa.
2009).
Here, the trial court rejected Appellant’s interpretation of Mr. Saxon’s
trial testimony and declined to find that Appellant had cured the breaches.
[The trial court] interpret[s] the testimony to mean Mr. Saxon
thought the breaches were cured but learned later they were not
cured. . . . . [The trial court] found Mr. Saxon credible when he
indicated he first thought the breaches were cured but later found
out he was mistaken as they were “not cured.” Because Mr. Saxon
credibly testified at the trial the breaches of the [Agreement] were
not cured, [the trial court] correctly determined [Appellant]
breached the [A]greement.
Trial Court Opinion, 5/14/18, at 6-7.
In sum, viewing the evidence in a light most favorable to Weston as the
verdict winner and given Appellant’s own admission and Mr. Saxon’s testimony
that Appellant failed to cure at least four breaches after receiving notice of the
same, we cannot conclude that the trial court erred in entering judgment in
Weston’s favor. Because Appellant repeatedly breached the Agreement and
failed to cure his breaches, Weston was entitled to terminate the Agreement.
The trial court, therefore, did not err in denying Appellant’s claim for a
permanent injunction. Appellant failed to establish a clear right to relief as a
matter of law.
Judgment affirmed.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 1/7/2019
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