Basile v. H & R BLOCK, INC.

*395 OPINION

Justice GREENSPAN.

We decide whether the Appellants, H & R Block, Inc. and H & R Block Eastern Tax Services, Inc. (collectively referred to as “Block”), properly preserved their right to challenge certification of a class represented by Appellee Sandra Basile. Here, the Superior Court held that Block waived its right to seek decertification of the class because it did not timely challenge the order granting class certification, even though Block ultimately won a later motion for summary judgment on the merits of the dispute. Our careful review of the facts and law reveals the Superior Court erred and we therefore reverse.

On April 23, 1993, Sandra J. Basile filed a lawsuit against Block, alleging that, among other things, Block breached its fiduciary duty in connection with its “Rapid Refund™” program. The Rapid Refund program allowed individuals to receive their income tax refund within days after electronically filing their income tax return by receiving a short-term loan from Mellon Bank. Basile alleged that Block thus deceived customers because the customers did not know they were receiving a short-term loan from Mellon Bank and the fees imposed by Block were actually extremely high interest rates on the short-term loan. Basile specifically alleged that she believed she received an expedited refund because she electronically filed the return and was not aware it was actually a short-term loan.

Basile sought certification of a class of individuals with similar claims. On January 17, 1996, the trial court entered an order that, for purposes of determining the class certification request, it would presume that Block was an agent of any person for whom it prepared a tax return. On May 30, 1997, the trial court, by relying on the January 17, 1996 presumption order, granted class certification on the issue of breach of fiduciary duty only. Block did not seek to file an immediate interlocutory appeal at this time.1 Instead, Block and the *396newly certified class (Appellees) filed cross motions for summary judgment. On December 31, 1997, the trial court granted Block’s motion for summary judgment and denied Appellees’ motion for summary judgment. The trial court held that Block did not have an agency or confidential relationship with Appellees and, therefore, there was no breach of fiduciary duty.

Appellees filed an appeal, claiming the trial court should have granted their motion for summary judgment because Block owed them a fiduciary duty based on an agency and/or confidential relationship. On February 13, 1998, Block filed cross-appeals, challenging the trial court’s January 17, 1996 presumption order and the May 30, 1997 class certification order.

On appeal, the Superior Court held Block’s cross-appeal challenge to the January 17, 1996 presumption order was waived for failure to preserve its objection to this presumption order in the trial court. Basile v. H & R Block, Inc., 729 A.2d 574, 587 (Pa.Super.1999). The Superior Court also held that an agency relationship existed between Block and Appellees. Id. The Superior Court did not discuss whether a confidential relationship existed. Id. Based on the existence of an agency relationship, the Superior Court reversed the grant of summary judgment and remanded the case to the trial court. Id. at 588.

Block filed a petition for allowance of appeal to this Court, seeking to challenge the Superior Court’s determination that an agency relationship existed. This Court granted review and held that the Superior Court erred in holding that an agency relationship existed. This Court remanded the case to the Superior Court to address whether a confidential relationship existed. Basile v. H & R Block, Inc., 563 Pa. 359, 761 A.2d 1115 (2000). On remand, the Superior Court held that the record established a prima facie case that a confidential relationship existed between Block and Appellees, and remanded the case back to the trial court. Basile v. H & R Block, Inc., Ill A.2d 95 (Pa.Super.2001). In the trial court, Block filed a motion for decertification of the class, which was *397granted on December 20, 2003. The trial court ruled that individualized evidence was necessary to prove breach of a fiduciary duty based on a confidential relationship and, therefore, the case could not be tried as a class action.

Appellees filed an appeal from the decertification order and on March 1, 2006, an en banc panel of the Superior Court reversed the decertification. Basile v. H & R Block, Inc., 894 A.2d 786 (Pa.Super.2006). The Superior Court held that Block had waived its right to challenge the class certification because it did not do so during the first appeal to the Superior Court in 1998. Id. at 790. Block again filed a petition for allowance of appeal to this Court. On September 26, 2006, by per curiam order, this Court granted allowance of appeal, vacated the Superior Court’s order, and remanded the case to the Superior Court with specific instructions to address Pennsylvania Rules of Appellate Procedure 501 and 511, and related case law.2

On remand, the en banc Superior Court again did not reach the merits of the trial court’s decision regarding class certification but instead held only that Block had waived its challenge to class certification. Basile v. H & R Block, Inc., 926 A.2d 493, 500 (Pa.Super.2007). This Court granted allowance of appeal on March 25, 2008 to determine whether the Superi- or Court misapplied the aggrieved party doctrine by requiring *398Block to appeal from an earlier class certification order even though summary judgment was entered in Block’s favor.

The Superior Court’s holding that Block waived its right to challenge the class certification is not only contrary to the law of Pennsylvania, but also undermined by the record. A thorough review of the extensive fifteen-year record in this case reveals that Block did indeed file Notices of Cross-Appeal from the January 17, 1996 presumption order and, more importantly, from the May 30, 1997 class certification order. In addition, Block briefed those two issues in the Superior Court and requested, “that the Court reverse Judge Avellino’s January 17, 1996 Order, as well as the class certification order issued May 30, 1997.” Block’s August 28, 1998 Brief at 45. Block’s two cross-appeals apparently were given separate docket numbers, both of which appeared in the caption of the Superior Court’s 1999 opinion. Basile, 729 A.2d at 574. But the Superior Court addressed only the cross-appeal from the January 17, 1996 presumption order and, as previously stated, held that the presumption issue was waived. Id. at 587. The Superior Court did not address Block’s cross-appeal of the May 30,1997 class certification order at all. Id.3

In addition, the Superior Court incorrectly applied Pennsylvania law by holding that Block was required to file a cross-appeal on the class certification issue. Pennsylvania Rule of Appellate Procedure 501 permits any “aggrieved party” to file an appeal. Pennsylvania case law also recognizes that a party adversely affected by earlier rulings in a case is not required to file a protective cross-appeal if that same party ultimately wins a judgment in its favor; the winner is not an “aggrieved party.” See Hospital & Health-system Ass’n of Pa. v. Dept. of Public Welfare, 585 Pa. 106, 888 A.2d 601 (2005) (holding that DPW was not an aggrieved *399party, as the prevailing party, and it did not need to file a cross-appeal).4 Our holding is further supported by the Note to Pennsylvania Rule of Appellate Procedure 511 which states, “An appellee should not be required to file a cross appeal because the Court below ruled against it on an issue, as long as the judgment granted Appellee the relief it sought.” Pa. R.A.P. 511, Note.5 Here, Block was the ultimate prevailing party at the time of the 1998 appeal because it won its motion for summary judgment on the merits of the class action. As the prevailing party, it was not required to file a protective cross-appeal on the issue of class certification, although it did.6

We also consider the Superior Court’s interpretation of Pennsylvania Rule of Civil Procedure 1710(d).7 See Basile, *400926 A.2d at 501. Pursuant to Rule 1710(d), a class action can be decertified at anytime “before a decision on the merits.” Pa.R.C.P. 1710(d). The Superior Court interpreted “before a decision on the merits” in Rule 1710(d) to mean that Block was required to challenge the class certification prior to the trial court’s ruling on the motion for summary judgment on the issue of breach of fiduciary duty.8 Basile, 926 A.2d at 501. While this interpretation is generally correct, it does not apply here where the Superior Court had earlier reversed the grant of summary judgment and remanded the matter to the trial court for further proceedings. Basile, 729 A.2d at 588. Once that happened, there was no “decision on the merits” and the trial court was permitted to revoke the class certification upon Block’s motion. See Pa.R.C.P. 1710(d); Debbs v. Chrysler Corp., 810 A.2d 187 (Pa.Super.2002) (holding that the class could be decertified three years after class certification when the jury verdict in favor of the plaintiffs was reversed on appeal because there was, at that point, no decision on the merits).9

In addition, and most importantly, the order granting class certification in this case was based on the presumption that an agency relationship existed between the parties. This Court *401ultimately held that an agency relationship did not exist. Basile, 761 A.2d at 1121. Then the Superior Court held that a confidential relationship existed instead, thereby changing the legal context within which the trial court had made the initial class certification decision. Basile, 777 A.2d at 103. At that point, Block was free to file its motion for decertification because no decision on the merits existed.

Here, Block may have lost its prehminary challenge to Appellees’ motion for class certification, but it ultimately prevailed on its motion for summary judgment on the merits. We hold that the Superior Court incorrectly held that Block waived its right to challenge the class certification because it did not seek immediate interlocutory review or file a cross-appeal. First, as stated previously, Block did indeed file a cross-appeal in the Appellees’ 1998 appeal from the summary judgment in its favor. In addition, as the prevailing party, Block was not required to file a protective appeal for every interlocutory adverse order entered prior to summary judgment in order to protect against the possibility that the Superior Court might reverse the summary judgment entered in its favor. Therefore, Block did not waive its challenge to class certification. Moreover, under Rule 1710(d), the trial court was authorized to consider Block’s motion for decertification after summary judgment was reversed. Accordingly, we reverse the order of the Superior Court and remand to the Superior Court for a determination on the merits of the trial court’s decision decertifying the class.

Order reversed. Jurisdiction relinquished.

Justice TODD and Justice McCAFFERY did not participate in the consideration or decision of this case. Chief Justice CASTILLE and Justice EAKIN join the opinion. Justice SAYLOR files a concurring opinion. Justice BAER files a concurring opinion.

. See Pa.R.A.P. 1311 (regarding interlocutory appeals by permission).

. Rule 501 provides: "Except where the right of appeal is enlarged by statute, any party who is aggrieved by an appealable order, or a fiduciary whose estate or trust is so aggrieved, may appeal therefrom.” Pa.R.A.P. 501. Rule 511 was amended in 2002 and now provides:

The timely filing of an appeal shall extend the time for any other party to cross appeal as set forth in Rules 903(b) (cross appeals), 1113(b) (cross petitions for allowance of appeal) and 1512(a)(2) (cross petitions for review). The discontinuance of an appeal by a party shall not affect the right of appeal of any other party regardless of whether the parties are adverse.

Pa.R.A.P. 511. Prior to the 2002 amendments, Rule 511 stated: “The discontinuance or, except as prescribed by Rule 903(b) (cross appeals) or by Rule 1113(b) (cross petitions), the taking of an appeal by a party shall not affect the right of appeal of any adverse party.” The Court also specified that the Superior Court should address Hospital & Healthsystem Ass'n of Pa. v. Dept. of Public Welfare, 585 Pa. 106, 888 A.2d 601 (2005) and Debbs v. Chrysler Corp., 810 A.2d 137 (Pa.Super.2002).

. We point out the fact that Block did file a cross-appeal of the class certification order in part to clarify the lengthy and complicated record in this case. While this clarification alone may appear to correct the Superior Court’s error in denying Block’s cross-appeal, reversal of the Superior Court requires a more detailed analysis of Pennsylvania law regarding cross-appeals.

. See also Wilson v. Transp. Ins. Co., 889 A.2d 563, 577 n. 4 (Pa.Super.2005) ("As the prevailing party, [Appellee] was not 'aggrieved' and therefore, did not have standing to appeal the judgment entered in its favor.’’); Ratti v. Wheeling Pittsburgh Steel Corp., 758 A.2d 695, 700 (Pa.Super.2000) ("Since Appellant was a prevailing party in the court below, it is not ‘aggrieved’ within the meaning of [Rule 501]."); Hashagen v. Workers' Comp. Appeal Bd., 758 A.2d 276, 277 n. 2 (Pa. Commw.2000) (“[o]nly ‘aggrieved’ parties may appeal, Pa.R.A.P. 501, and a party who prevails simply is not an aggrieved party and has no standing to appeal.”) (internal citations omitted).

. Contrary to Appellees' assertion, it is irrelevant that Block's case was commenced prior to the revision of Rule 511 in 2002. Even a cursory examination of the 2002 amendment to Rule 511 demonstrates that the rule change does not affect the case at hand. Rule 511 was not substantively changed in 2002, except that language was added regarding filing deadlines, which are not relevant here. With regard to the issues in this case, the rule itself says almost exactly what it said prior to 2002.

. In addition, the failure of Block to file an earlier interlocutory appeal by permission pursuant to Pennsylvania Rule of Appellate Procedure 1311 does not result in waiver of the class certification issue. See, e.g., Commonwealth v. Jackson, 409 Pa.Super. 568, 598 A.2d 568, 577 (1991) (holding that failure to seek a permissive interlocutory appeal does not result in waiver because to find waiver would create a "self-contradictory mandatory, permissive interlocutory appeal") (internal citations omitted) (emphasis in original).

. Rule 1710(d) governs decertification of class actions and provides in relevant part:

(d) An order under this rule may be conditional and, before a decision on the merits, may be revoked, altered or amended by the court on its own motion or on the motion of any party. Any such *400supplemental order shall be accompanied by a memorandum of the reasons therefor.

Pa.R.C.P. 1710(d).

. A decertification motion by Block at that point in the litigation, immediately after opposing the class certification in written motions and oral arguments, would have been futile and is simply not necessary in order to preserve the issue for appeal. To so hold would make motions for reconsideration mandatory in order to preserve an issue for appeal. They clearly are not. See Northampton Convalescent Ctr. v. Dept. of Public Welfare, 550 Pa. 167, 703 A.2d 1034, 1038 n. 9 (1997) (noting that a motion for reconsideration is not required to preserve an issue for appeal).

. As Justice Saylor notes in his concurrence, Federal Rule of Civil Procedure 23 modified the language "decision on the merits” to "final judgment" in 2003. Fed.R.Civ.P. 23(c)(1)(C). However, the Pennsylvania Rules of Civil Procedure still contain this precise "decision on the merits” language and, as such, the proper analysis is to conclude that the Superior Court’s reversal of summary judgment revoked the decision on the merits and allowed Block to file a motion for decertification.