Michelle Prin v. Bob's Beer & Soda, Inc. ( 2018 )

J-A11034-18
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
MICHELLE PRIN AND JOANNE BAST : IN THE SUPERIOR COURT OF
PARTNERS, LLC, MICHELLE PRIN, : PENNSYLVANIA
JOANNE S. BAST AND WILLIAM PRIN :
:
v. :
:
BOB'S BEER AND SODA, INC. AND :
ROBERT E. SHAFFER :
:
:
APPEAL OF: JOANNE BAST : No. 1190 MDA 2017
:
:
Appeal from the Order Entered September 26, 2017
in the Court of Common Pleas of Adams County
Civil Division at No.: 12-S-1176
MICHELLE PRIN AND JOANNE BAST : IN THE SUPERIOR COURT OF
PARTNERS, LLC, MICHELLE PRIN, : PENNSYLVANIA
JOANNE S. BAST AND WILLIAM PRIN :
:
v. :
:
BOB'S BEER AND SODA, INC. AND :
ROBERT E. SHAFFER :
:
:
APPEAL OF: BOB’S BEER AND :
SODA, INC. AND ROBERT E. :
SHAFFER : No. 1230 MDA 2017
:
Appeal from the Order Entered September 26, 2017
in the Court of Common Pleas of Adams County
Civil Division at No.: 12-S-1176
BEFORE: STABILE, J., NICHOLS, J., and PLATT*, J.
____________________________________
* Retired Senior Judge assigned to the Superior Court.
J-A11034-18
MEMORANDUM BY PLATT, J.: FILED AUGUST 31, 2018
In these consolidated cross-appeals, the buyer and the seller of a beer
distributorship challenge various elements of the trial court’s grant, after a
bench trial, of injunctive relief, and attorney fees, but not monetary damages,
in the enforcement of a covenant not to compete.1 Appellant, Joanne S. Bast,
claims injunctive relief was not necessary at all, and in any case, the court
should not have extended its duration.2 She also challenges the court’s award
of attorney fees to Appellees, Bob’s Beer and Soda, Inc. and its president,
Robert E. Shaffer, claiming they were not the prevailing parties. Appellees
assert that the court should have awarded them monetary damages as well
____________________________________________
1 Appellant purports to appeal from the order filed June 29, 2017, denying
motions for post-trial relief. (See Notice of Appeal, 7/28/17; see also
Appellant’s Brief, at 2). However, the appeal properly lies from the final order.
See Commonwealth v. Harris, 32 A.3d 243, 248 (Pa.2011); see also
Pa.R.A.P. 341(a). Here, the Prothonotary entered judgment on September
26, 2017. (See Rule 36 Notice of Entry of Judgment, 9/26/17). In spite of
the premature filing, we may review this matter because a final order has
been entered. See Commonwealth v. Tillery, 611 A.2d 1245, 1247 (Pa.
Super. 1992), appeal denied, 616 A.2d 984 (Pa.1992) (reviewing premature
appeal where final order entered thereafter); see also Pa.R.A.P. 905(a)(5)
(“A notice of appeal filed after the announcement of a determination but
before the entry of an appealable order shall be treated as filed after such
entry and on the day thereof.”). We have amended the caption accordingly.
2 Although the caption of the appeal includes Michelle Prin and Joanne Bast
Partners, LLC, Michelle Prin and William Prin, as additional Appellants, the trial
court essentially decided in favor of the other named Appellants (plaintiffs in
the underlying declaratory judgment action). In fact, only Ms. Bast appealed.
(See Appellant’s Brief, at 9 n.2). However, Appellees included all of the
original plaintiffs in their answer and counterclaim.
-2-
J-A11034-18
as injunctive relief. They claim error in the trial court’s refusal to enforce the
restrictive covenant against other presumptively interested parties who were
not signers of the Purchase Agreement at issue. Finally, they assert error in
the trial court’s refusal to award the entire amount of attorney fees requested.
We affirm.
The underlying facts are not in substantial dispute. On or about May 5,
2008, Joanne Bast signed the Purchase Agreement by which Yingling’s Thrifty
Dutch Beverage, Inc. sold the assets of its beer distributorship (including the
real estate and fixtures, plus goodwill and license) to Appellee Robert E.
Shaffer for $1,500,000.00.
Appellant Joanne S. Bast owned 50% of the shares of the corporation.
Patricia Prin owned the other 50%. Patricia Prin is the former wife of Dr.
William Prin. They divorced in 2005 (or 2006).3 By virtue of a marital
settlement agreement, Dr. Prin had a residual interest in half of the proceeds
to Patricia of the sale of Yingling Thrifty Dutch Beverage.
The sole signatory to the Purchase Agreement for Seller was Joanne S.
Bast. Ms. Bast initialed each page of the agreement and signed at the end as
the designated “Seller.” The real estate agent involved in the transaction
____________________________________________
3 Both years are given in the record. However, there is no dispute that the
Prins were divorced by the time of the sale, and their respective rights to share
in the proceeds of the sale were based on the marital settlement agreement.
Therefore, the exact year is not critical to the issues on appeal, or our
disposition.
-3-
J-A11034-18
testified that he provided the Purchase Agreement based on a standard form
used in his employer’s real estate firm. The Sellers received their full asking
price. (See N.T. Trial, 10/27/15, at 82).
Notably, for the issues raised on appeal, the Agreement contained a
covenant not to compete, which prohibited the Seller from competing “directly
or indirectly” with “Buyer,” Appellees, within a ten-mile radius of the existing
business location for a period of ten years from the date of settlement of the
sale.4
In short order, Shaffer re-named the business “Bob’s Beer,” dismissed
the previous manager, repainted and made other changes in décor, and began
____________________________________________
4 It deserves mention that counsel for Defendants/Appellees apologized at trial
for the “poor quality” of the copy of the Agreement. (N.T. Trial, 10/27/15, at
9). In fact, all of the copies provided are in deplorable condition and nearly
illegible. However, as there is no dispute about the specific text of the
covenant, our review is not impeded. The covenant not to compete, in the
form agreed-on by the parties, states in pertinent part:
6.) Other terms and Conditions:
* * *
(vii) Seller agrees that from the date of settlement, Seller
shall not compete directly or indirectly in the same or similar
type of business with Buyer within a ten (10) mile radius of
the existing business for a period of ten (10) years. This
provision shall not apply to the existing business known as
HBO, Inc. located at 1307 Baltimore Pike, Hanover, PA
17331.
(Purchase Agreement, 5/05/08, at 2 ¶ 6(vii); see also Appellant’s Brief, at
11; Appellees’ Brief, at 3). The exception refers to a separate beer
distributorship owned by Dr. Prin.
-4-
J-A11034-18
operating in the same location. On March 13, 2012, Ms. Bast, in partnership
with Michelle Prin, (the succeeding wife of Dr. Prin), as “Michelle Prin and
Joanne Bast Partners, LLC,” purchased “Beer Express” and eventually opened
a beer distributorship about three miles (3.6 miles) west of the original Thrifty
Dutch Beverage−now Bob’s Beer−location. They renamed the Beer Express,
the “RT 116 Beer Xpress.”
Shaffer asserted a violation of the covenant not to compete, and
threatened a lawsuit unless they stopped operating RT 116. Instead,
plaintiffs, Michelle Prin and Joanne Bast partners, LLC, Michelle Prin, Joanne
S. Bast and Dr. William Prin, brought the declaratory judgment action
underlying this appeal, claiming the covenant not to compete was illegal, and
seeking to have the court declare it unenforceable. (See Complaint for
Declaratory Judgment, 8/03/12, at 8). Appellees answered and
counterclaimed for injunctive relief, alleging that the remaining parties
“conspired” with Ms. Bast to violate the non-competition provision, and
asserting that “a remedy at law for damages is not adequate.” (Appellees’
Answer and New Matter, 9/05/12, at ¶ 66; see also ¶¶ 64-65).
At trial, and on appeal, Ms. Bast maintained that she was an artist, not
a businessperson, and that her role in both of the beer distributorships at issue
was essentially that of a passive investor. She acknowledged signing the
Purchase Agreement, but testified that she understood the agreement to be
in the nature of a working draft, as part of an ongoing negotiation. (See N.T.
-5-
J-A11034-18
Trial, 10/27/15, at 80-81). The trial court found her explanation “insufficiently
credible.” (Trial Ct. Op., at 4).
Moreover, our review of the record reveals that despite Appellant’s
claimed reliance on the assurances of the real estate agent, there are several
references to counsel, and no indication that Ms. Bast could not have consulted
counsel before signing, had she chosen to, on the questions she now raises
on appeal.
Shaffer testified that he would not have purchased the beer
distributorship without the restrictive covenant. The trial court found him
credible. (See id. at 6).
After the bench trial, the court found in favor of all plaintiffs, except Ms.
Bast. The trial court decided that Ms. Bast, the sole signer for Thrifty Dutch
Beverage in the sale of that beer distributorship to Shaffer, had violated the
covenant not to compete by going into partnership with Ms. Michelle Prin in
opening RT 116. Additionally, the court found that Appellees had established
a causal connection between the violation of the non-compete agreement by
Ms. Bast, and drops in Appellees’ business, sufficient to support injunctive
relief.
Nevertheless, the court further found that Appellees, despite “a noble
effort” to prove actual damages, could only provide anecdotal information
about the ebb and flow of business. (Id. at 11). Tax returns and related
business records showed fluctuations (both up and down) in revenue and
-6-
J-A11034-18
profit which did not directly correlate with the opening and operation of RT
116. The court decided that the anecdotal evidence of loss based on Ms.
Bast’s involvement with RT 116 was too speculative and insufficient to
establish a claim to economic damages requested by Appellees. (See id. at
12). The court also noted that in their request for injunctive relief, the
Appellees averred that “a remedy at law for damages is not adequate.”
(Appellees’ Answer and New Matter, at ¶ 66; see also Trial Ct. Op., at 11).
Accordingly, the court declined to award monetary damages. However, it
enjoined Appellant from violating the covenant not to compete clause for a
new term of ten years beginning with the date of the court order.
The court also granted Appellees’ attorney fees, but in the amount of
$16,853.90, less than the $27,000 requested. Both parties dispute the court’s
award of attorney fees. Appellees claim that the trial court improperly reduced
the amount of their fee award. Appellant complains that on her comparison
of relief sought to relief granted, Appellees were not the “prevailing party,”
and therefore should get no award for attorney fees at all.
The agreement of sale included the following pertinent provision:
33. Attorneys’ Fees. In any litigation, arbitration or other
legal proceeding, which may arise between any of the parties
hereto, including Agent, the prevailing party shall be entitled to
recover its costs, including [illegible] costs, costs of arbitration,
[illegible] reasonable attorney’s (sic) fees in addition to any other
relief in which such party may be entitled.
(Purchase Agreement, at 5 of 7).
-7-
J-A11034-18
Ms. Bast timely appealed, following the denial of post-trial motions.
Appellees cross-appealed. Both parties filed a Rule 1925(b) statement of
errors.5 The trial court filed its opinion on October 30, 2017. See Pa.R.A.P.
1925.
Appellant presents three questions for our review:
A. Did the trial court err in granting the Appellees’ claim for
injunctive relief against Joanne Bast where the Appellees did not
prove the injunction is reasonably necessary to prevent harm to
their legitimate business interests?
B. Did the trial court err in granting a ten-year injunction
from the date of the order where the length of the injunction is
not reasonably necessary to protect a legitimate business interest
and the contract did not include a tolling provision?
C. Did the trial court err in awarding attorneys’ fees to the
Appellees where they were not the prevailing parties in the
litigation?
(Appellant’s Brief, at 4).
Appellees also present three questions:
D. Did the [t]rial [c]ourt err in dismissing Appellees’ claim
for economic damages against the Appellants, as there was
sufficient evidence in the record to support that claim?
E. Did the [t]rial [c]ourt err in not enforcing the restrictive
covenant against Appellants William Prin and Michelle Prin as co-
conspirators as there was sufficient evidence in the record to
prove that both of them knew of the covenant not to compete, yet
aided and assisted Appellant Joanne Bast in her willful and
intentional violation of the covenant?
____________________________________________
5 It bears noting that Appellant’s statement of errors raised twelve issues,
framed as four questions with multiple sub-parts. (See Rule 1925(b)
Statement of Matters Complained of on Appeal, 8/24/17).
-8-
J-A11034-18
F Did the [t]rial [c]ourt err in not awarding Appellees all of
the counsel fees requested?
(Cross-Appellants’ [Appellees’] Brief, at 2).
The legal principles applicable to the parties’ claims are well-settled.
Our scope of review in a non-jury trial is limited to whether
findings of fact are supported by competent evidence and whether
the trial court committed an error of law. With respect to factual
conclusions, this Court may reverse the trial court if its findings of
fact are predicated on an error of law or are unsupported by
competent evidence in the record.
Szymanski v. Dotey, 52 A.3d 289, 292 (Pa. Super. 2012) (citations and
internal quotation marks omitted).
In reviewing the factual determinations of the trial court
sitting as finder of fact, we must attribute to them the same force
and effect as a jury’s verdict. Accordingly, we view the evidence
and all reasonable inferences therefrom in the light most favorable
to the . . . verdict winners. We will only upset the findings if there
is insufficient evidence, or if the trial court committed an error of
law. In reviewing the findings, the test is not whether we would
have reached the conclusion of the trial court, but rather whether
we reasonably could have reached the same result. We will not
substitute our judgment for that of the trial court.
Rizzo v. Haines, 555 A.2d 58, 61 (Pa. 1989) (citations omitted).
The determination of damages is a factual question to be
decided by the fact-finder. This duty of assessing damages is
within the province of the fact-finder and should not be interfered
with unless it clearly appears that the amount awarded resulted
from partiality, caprice, prejudice, corruption or some other
improper influence. The fact-finder must assess the worth of the
testimony, by weighing the evidence and determining its
credibility, and by accepting or rejecting the estimates of the
damages given by the witnesses. In reviewing the award of
damages, the appellate courts should give deference to the
decisions of the trier of fact who is usually in a superior position
to appraise and weigh the evidence.
-9-
J-A11034-18
Delahanty v. First Pennsylvania Bank, N.A., 464 A.2d 1243, 1257 (Pa.
Super. 1983) (citations omitted).
“Under the American Rule, applicable in Pennsylvania, a litigant cannot
recover counsel fees from an adverse party unless there is express statutory
authorization, a clear agreement of the parties, or some other established
exception.” Trizechahn Gateway LLC v. Titus, 601 Pa. 637, 652, 976 A.2d
474, 482–83 (Pa. 2009).
“By now it is hornbook law that the reasonableness of the fee is a matter
for the sound discretion of the lower Court and will be changed by an appellate
Court only when there is a clear abuse of discretion.” In re LaRocca's Trust
Estate, 246 A.2d 337, 339 (Pa. 1968) (citations and footnote omitted). This
Court has further explained:
We have a limited power of review of court awarded fees.
As the Supreme Court has so frequently stated, the responsibility
for setting such fees lies primarily with the trial court and we have
the power to reverse its exercise of discretion only where there is
plain error. Plain error is found where the award is based either
on factual findings for which there is no evidentiary support or on
legal factors other than those that are relevant to such an award.
The rationale behind this limited scope of review is sound. It is
the trial court that has the best opportunity to judge the attorney’s
skills, the effort that was required and actually put forth in the
matter at hand, and the value of that effort at the time and place
involved.
Gilmore by Gilmore v. Dondero, 582 A.2d 1106, 1108–09 (Pa. Super.
1990) (citations omitted).
Here, in Appellant’s first claim, she challenges the trial court’s grant of
injunctive relief. She maintains that Appellees did not prove the injunction is
- 10 -
J-A11034-18
reasonably necessary to prevent harm to their legitimate business interests.
We disagree.
Preliminarily, we note that many of the cases cited by Appellant in
support of her argument actually involve enforcement of covenants not to
compete in the context of an employment relationship. (See, e.g.,
Appellant’s Brief, at 18-19) (citing WellSpan Health v. Bayliss, 869 A.2d
990, 993 (Pa. Super. 2005) (physician ex-employee); Hess v. Gebhard &
Co. Inc., 808 A.2d 912, 914 (Pa. 2002) (insurance agent employee); Scobell
Inc. v. Schade, 688 A.2d 715, 716 (Pa. Super. 1997) (sheet metal shop
employee for HVAC firm). Appellant would have us employ the wrong test.
As nominally acknowledged by Appellant, (see Appellant’s Brief, at 19),
Pennsylvania law has long recognized a distinction between the greater
hardship imposed by a restrictive covenant on an employee, or former
employee, and enforcement of a covenant in the sale of a business context.
See Morgan's Home Equip. Corp. v. Martucci, 136 A.2d 838, 846 (Pa.
1957) (sales employees).
Our Supreme Court noted that the “mobility of capital” enables a
business investor to make use of investment funds more easily “in other
localities and in other industries.” Id.
In view of this greater hardship imposed on an employee, general
covenants not to compete ancillary to employment are subject to a more
- 11 -
J-A11034-18
stringent test of reasonableness than is applied to restrictive covenants
ancillary to the sale of a business. See id.
The standard of review for a restrictive covenant ancillary to the sale of
a business is as follows:
The law in this Commonwealth for more than a century has
been that in order to be enforceable a restrictive covenant must
satisfy three requirements; (1) the covenant must relate to either
a contract for the sale of goodwill or other subject property or to
a contract for employment; (2) the covenant must be supported
by adequate consideration; and (3) the application of the
covenant must be reasonably limited in both time and territory.
Piercing Pagoda, Inc. v. Hoffner, 351 A.2d 207, 210 (Pa. 1976) (citations
omitted).
General covenants not to compete which are ancillary to the
sale of a business serve a useful economic function; they protect
the asset known as ‘good will’ which the purchaser has bought.
Indeed, in many businesses it is the name, reputation for service,
reliability, and the trade secrets of the seller rather than the
physical assets which constitute the inducements for a sale. Were
the seller free to re-enter the market, the buyer would be left
holding the proverbial empty poke. When restrictive covenants
are limited to the area of potential competition with the purchaser
and limited in time to the period required for the purchaser to
establish his own customer following, then they are [enforceable]
although a partial restraint upon the free exercise of trade.
Morgan's Home Equip., supra at 846.
Here, the covenant relates to the sale of goodwill ancillary to the
purchase of a business, satisfying the first requirement. See Piercing
Pagoda, supra at 210. Secondly, the covenant was supported by adequate
consideration. The parties allocated almost $775,000 to good will and license.
(See Trial Ct. Op., at 6).
- 12 -
J-A11034-18
Therefore, the sole remaining requirement is that the covenant must be
reasonably limited in both time and territory. The trial court found here that
both limitations were reasonable. (See id. at 7). Specifically, the court found
that in a small, rural marketing area such as Hanover, Pennsylvania, a ten-
mile radius was not unreasonable, and a ten-year effectiveness period gave
the purchaser a reasonable time to re-coup his investment. (See id.). On
independent review, we discern no basis on which to disturb the findings of
the trial court.
In fact, Appellant fails to develop a specific argument to challenge the
order for injunctive relief as not reasonably limited with respect to time and
territory. Instead, she focuses on her lack of special skills or trade secrets
relating to the retail sale-of-beer business, and concludes that Appellees have
failed to prove that the restrictive covenant protects customer relationships or
good will. (See Appellant’s Brief, at 23). Appellant’s argument is
unresponsive, unpersuasive, and does not merit relief.
While trade secrets or special skills could provide an independent basis
for a restrictive covenant (especially in an employment context), their absence
here does not preclude Appellees’ legitimate interest in seeking to maintain
- 13 -
J-A11034-18
the goodwill for which they had already provided ample consideration. 6 See
Piercing Pagoda, supra at 210. Appellant’s first claim fails.
In Appellant’s second claim, she argues that the ten-year injunction
from the date of the trial court’s order was not reasonably necessary to protect
a legitimate business interest, echoing the theme of her first claim.
The trial court confirms that Appellant failed to develop this claim during
post-trial proceedings. (See Trial Ct. Op., at 10). In her brief, Appellant
provides nothing more than a blanket citation asserting that all issues raised
in the appeal were preserved in the post-trial motion. (See Appellant’s Brief,
at 16). This Court is not required to scour the record to find evidence to
support Appellant’s arguments. We conclude that the trial court properly
found that Appellant’s second claim is waived. See Pa.R.A.P. 302(a).
In her third and final claim, Appellant requests that we reverse the order
of the trial court awarding attorneys’ fees to Appellees. She asserts that the
court erred in awarding any attorney fees to Appellees, on the ground that
____________________________________________
6 Appellant correctly notes that Appellees chose to differentiate themselves
from Thrifty Dutch Beverage by change of name, décor, etc. However,
whatever the wisdom of these changes as a business decision, these acts
alone do not preclude Appellees from enforcing the restrictive covenant.
Appellees would still have had a right to enforce the restrictive covenant if
Thrifty Dutch had attempted to re-open, say, next door. Beyond that, the
reasonableness of the restrictive covenant is simply a matter of the
reasonableness of breadth and duration of the covenant, as discussed in the
text and in the trial court opinion.
- 14 -
J-A11034-18
they were not the prevailing parties in this litigation. (See Appellant’s Brief,
at 4). We disagree.
“Our review of a trial court’s award of attorney’s fees is limited. We may
only consider whether the court palpably abused its discretion in making a fee
award.” Oliver v. Irvello, 165 A.3d 981, 985 (Pa. Super. 2017) (citation and
internal quotation marks omitted). As we have already noted, we have the
power to reverse the trial court’s exercise of discretion in the award of attorney
fees only where there is plain error. See Gilmore by Gilmore, supra at
1108–09.
Here, Appellant maintains that Appellees “were successful on only a
small sliver of the relief they sought.” (Appellant’s Brief, at 43). Relying
principally on an unpublished per curiam federal case from the Third Circuit,
not binding on this Court, Appellant endeavors to compare “the relief sought”
to “the relief each litigant actually received.” (Id. at 42) (citing PPG Indus.,
Inc. v. Zurawin, 52 F. App’x 570, 580 (3d Cir. 2002)).
We do not disagree with the “common sense comparison” approach
adopted in Zurawin. However, we do find Appellant’s application of it to be
deficient and unpersuasive. Appellees did not initiate the instant action, even
if they had threatened one. Instead, they sought relief in response to the
action for declaratory judgment bought by Appellant and her co-plaintiffs.
Appellant’s list of six “results” is not only highly subjective but also
unduly repetitive, e.g., citing “the failure to obtain money damages” four
- 15 -
J-A11034-18
separate times in four separate ways out of the six results identified.
(Appellant’s Brief, at 41, 42). We find more pertinent (and binding) authority
in Oliver, supra at 985: (“The plain meaning of ‘prevailing part[y]’ is the
party who wins the lawsuit.”).
“[P]revailing party,” is commonly defined as “a party in whose
favor a judgment is rendered, regardless of the amount of
damages awarded.” While this definition encompasses those
situations where a party receives less relief than was sought or
even nominal relief, its application is still limited to those
circumstances where the fact finder declares a winner and the
court enters judgment in that party’s favor. . . .
Profit Wize Mktg. v. Wiest, 812 A.2d 1270, 1275–76 (Pa. Super. 2002)
(citation omitted).
Here, Appellant and the other plaintiffs brought an action for declaratory
judgment. The other plaintiffs, who were not a party to the Purchase
Agreement, which included the restrictive covenant, “won.” They did not
appeal.
Appellant, who did sign, “lost.” Whether Appellant signed (or intended
to sign) in her personal capacity, as a 50% shareholder, or simply with
apparent authority to sign on behalf of the corporation, is of reduced
significance, as the language is not ambiguous.
Appellant did not dispute that she signed the document, and the trial
court found her later, exculpatory explanations less than credible. The terms
of the agreement speak for themselves. On the over-arching issue, Appellees
plainly prevailed. Appellant sought to have the restrictive covenant declared
- 16 -
J-A11034-18
unenforceable. The trial court found that it was enforceable, as to Appellant.
Appellant’s third issue does not merit relief.
We now turn to Appellees’ three issues. Appellees’ first issue claims
there was sufficient evidence for monetary damages. Applying our standard
of review, we disagree.
As already noted, we attribute the same force and effect to the trial
court’s factual findings as to a jury verdict. See Rizzo, supra at 61. Here,
the trial court found that Appellees failed to establish a direct causal effect
from Appellant’s violation of the covenant not to compete to ascertainable
monetary damages. (See Trial Ct. Op., at 9) (“The inability to itemize such
loss through a causal connection between the breach and the damage is
obvious in the trial testimony.”). On independent review, we discern no basis
to disturb the findings of the trial court.
Most conspicuously, Appellees offer only their own fluctuating sales
results (as documented in tax returns) for proof of damages. Apparently,
Appellees offered no expert analysis. They presented only minimal analysis
of the impact of other competing beer distributors, and none concerning
general economic conditions.
Without more, attributing 100% of the drop in sales at Bob’s Beer to RT
116 is a classic exercise of the fallacious logic of “post hoc, ergo propter
hoc,” (“after this, therefore because of this”). See, e.g., Haney v.
Pagnanelli, 830 A.2d 978, 987 (Pa. Super. 2003) (Bender, J., dissenting).
- 17 -
J-A11034-18
Post hoc describes “the fallacy of assuming causality from temporal sequence;
confusing sequence with consequence.” (Id.) (citation omitted). Assuming
that something which comes after a prior event is caused by the prior event,
does not prove a causal connection, it merely assumes it. Appellees’ first
claim does not merit relief.
Appellees’ second claim asserts there was sufficient evidence for the
trial court to enforce the covenant not to compete against non-signers, namely
Dr. Prin and Michelle Prin. (See Appellees’ Brief, at 2). Appellees argue that
Dr. and Mrs. Prin were “co-conspirators” with Ms. Bast. (Appellees’ Brief, at
14). We disagree.
Our standard of review is well-settled. The Pennsylvania Supreme Court
set forth the elements of civil conspiracy in Thompson Coal Co. v. Pike Coal
Co., 412 A.2d 466, 472 (Pa. 1979): (“[It] must be shown that two or
more persons combined or agreed with intent to do an unlawful act or
to do an otherwise lawful act by unlawful means.”). Id. (emphasis
added). Proof of malice, i.e., an intent to injure is an essential part of a
conspiracy cause of action; this unlawful intent must also be without
justification. See id. Furthermore, a conspiracy is not actionable until “some
overt act is done in pursuance of the common purpose or design . . . and
actual legal damages result.” Baker v. Rangos, 324 A.2d 498, 506 (Pa.
Super. 1974) (citations omitted).
- 18 -
J-A11034-18
Here, Appellees fail to establish the elements of a conspiracy. Appellees
argue that both Dr. Prin and Michelle Prin “were aware of the covenant signed
by Joanne Bast.” (Appellees’ Brief, at 14). But mere awareness, even if
conceded for the sake of the argument, does not establish the required
elements of a conspiracy.
The only Pennsylvania authority Appellees offer in support of their claim
is Sklaroff v. Sklaroff, 106 A. 793 (Pa. 1919). (See Appellees’ Brief, at 15).
Appellees’ reliance on that venerable but rarely cited case is misplaced. In
Sklaroff, our Supreme Court affirmed a decision finding restraint of trade in
an alleged scheme to monopolize a fish smoking and wholesale business which
grew out of a family firm. It apparently involved surreptitious funding of a
nominally independent competitor by one of the competing family factions.
See Sklaroff, supra at 794.
Here, Appellees fail to develop an argument establishing any meaningful
connection between the abbreviated facts given in Sklaroff and their own
allegation of a general conspiracy in the case before us. In fact, in Sklaroff,
neither “conspiracy” nor “conspire” is even mentioned. Appellees fail to
establish that a conspiracy occurred in this case. Their second claim does not
merit relief.
In their third and final claim, Appellees challenge the trial court’s
decision to award less counsel fees than the full amount requested. As already
- 19 -
J-A11034-18
noted, under controlling authority, we have only a limited power of review of
court awarded fees. See Gilmore by Gilmore, supra at 1108–09.
Here, the trial court explained that it reduced the attorneys fee
requested in recognition of the reality that Appellees had not prevailed against
all parties. (See Trial Ct. Op., at 16-17). Appellees’ minimal argument is
made expressly contingent on prevailing as to the issues of monetary
damages, and conspiracy liability for Dr. and Mrs. Prin. (See Appellees’ Brief,
at 16). However, Appellees did not prevail on either of these claims. The
claim for additional counsel fees is moot.
As previously noted, the test on review is not whether we would have
reached the conclusion of the trial court, but rather whether we reasonably
could have reached the same result. See Rizzo, supra at 61. On
independent review, we conclude that we reasonably could have reached the
same result as the trial court.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 08/31/2018
- 20 -