Mazza, K. v. Novruzaj, A. ( 2022 )

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NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
KELLY MAZZA IN THE SUPERIOR COURT
OF PENNSYLVANIA
Appellee
v.
AGIM NOVRUZAJ
AND ALIME NOVRUZAJ
Appellants No. 600 EDA 2021
Appeal from the Order Entered March 8, 2021
In the Court of Common Pleas of Philadelphia County
Civil Division at No: 201000136
BEFORE: BOWES, J., STABILE, J., and McCAFFERY, J.
MEMORANDUM BY STABILE, J.: FILED FEBRUARY 7, 2022
Appellants, Agim Novruzaj and Alime Novruzaj, appeal from the March
8, 2021 order overruling their preliminary objections to the complaint of
Appellee, Kelly Mazza. We quash.
On July 28, 2019, the parties executed an agreement of sale
(“Agreement”) pursuant to which Appellants were to build a home for Appellee
in exchange for $830,000.00. Appellee alleges that a December 11, 2019
inspection revealed significant defects, that Appellants agreed to repair those
defects but failed to do so, and that the cost to Appellee to repair the defects
will be $357,550.36. On September 29, 2020, Appellee filed a complaint
alleging breach of warranty, breach of contract, unjust enrichment, fraudulent
inducement, and violations of the Unfair Trade Practices and Consumer
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Protection Law (“UTPCPL”), 73 P.S. § 201-1, et seq. On November 23, 2020,
Appellants filed preliminary objections asserting, among other things, that a
clause in the Agreement required non-binding mediation prior to the
commencement of litigation. See Pa.R.C.P. No. 1028(a)(6) (“Preliminary
objections may be filed by any party to any pleading and are limited to the
following grounds: […] (6) pendency of a prior action or agreement for
alternative dispute resolution.”). On March 8, 2021, the trial court entered
the order on appeal, in which it overruled Appellants’ preliminary objections.
Appellants filed this appeal on March 17, 2021. They argue the trial court
erred in overruling their preliminary objection based on the parties’ agreement
for alternative dispute resolution.
Before we address the merits, we must consider whether we have
jurisdiction over this appeal. Appellants claim jurisdiction is proper under
Pa.R.A.P. 311(a)(8), which provides for an appeal as of right from an order
“made final or appealable by statute or general rule,” and 42 Pa.C.S.A.
§ 7321.29(a)(1) of the Statutory Arbitration Act, which permits an appeal
from an order denying a motion to compel arbitration.
In Armstrong World Indus., Inc. v. Travelers Indem. Co., 115 A.3d
342 (Pa. Super .2015), appeal denied, 128 A.3d 218 (Pa. 2015), this Court
considered a similar issue under § 7320(a)(1) of the Uniform Arbitration Act.
There, the plaintiff filed an action for breach of contract, bad faith, and
declaratory relief against its insurer. The insurer filed preliminary objections
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under Rule 1028(a)(6) based on a contractual Alternative Dispute Resolution
(“ADR”) provision providing for negotiations and/or non-binding arbitration.
Id. at 343-44. The trial court overruled the preliminary objections and the
insurer appealed. The insurer asserted the order was appealable under
Pa.R.A.P. 311(a)(8) and the Uniform Arbitration Act (”UAA”), 42 Pa.C.S.A. §
7320(a)(1).1 Rule 311(a)(8) permits an appeal as of right to an order ”made
appealable by statute.” Pa.R.A.P. 311(a)(8).2 Section 7320(a)(1) of the UAA
provides that an order denying an application to compel arbitration is
immediately appealable. 42 Pa.C.S.A. § 7320(a)(1).
”To render an order overruling preliminary objections seeking to compel
arbitration appealable under the Act, a party must prove that the dispute is
bound by an arbitration agreement, which calls for either statutory or common
law arbitration.” Armstrong, 115 A.3d at 346. Because the ADR clause at
issue in Armstrong provided a wide range of ADR procedures, from
negotiation to mediation, to binding arbitration, this Court concluded that the
ADR provision was not an agreement to arbitrate within the meaning of § 7302
of the UAA. Id. at 346. The insurer therefore had no basis upon which to
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1 Because the ADR provision presently at issue does not mention arbitration,
we do not address the Uniform Arbitration Act.
2 ”It is well-settled that “[u]nder Pennsylvania law, an appeal may only be
taken from an interlocutory order as of right (Pa.R.A.P. 311), from a final order
(Pa.R.A.P. 341), from a collateral order (Pa.R.A.P. 313), or from any
interlocutory order by permission (Pa.R.A.P. 31[2], [Pa.R.A.P.] 1311, 42
Pa.C.S.A. § 702(b)).” Armstrong, 115 A.3d at 345.
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seek interlocutory review of the trial court’s order under Rule 311(a)(8) and
the UAA. Id. at 347.
Appellants acknowledge Armstrong but argues that it was tacitly
overruled in Taylor v. Extendicare Health Facilities, 147 A.3d 490 (Pa.
2016). We conclude Taylor is inapposite here. In Taylor, the plaintiff
brought wrongful death and survival actions against the defendant nursing
home. The survival claim was subject to an agreement to arbitrate between
the plaintiff and the defendant nursing home, but the wrongful death action
was not. The nursing home moved to bifurcate the actions, but the trial court
refused because Rule 213(e) of the Pennsylvania Rules of Civil Procedure
requires that wrongful death and survival actions be consolidated for trial. A
divided Court held that the Federal Arbitration Act (“FAA”), 9 U.S.C. § 2preempts Rule 213 and that the actions should be bifurcated and the
agreement to arbitrate enforced. Id. at 492-94.
Pertinent here is that the Taylor Court, citing § 7320(a)(1), entertained
an appeal from an interlocutory order overruling preliminary objections. Id.
at 496 n.3. Taylor is easily distinguishable, however, in that the agreement
to arbitrate before the Taylor Court was just that—the parties’ contract
required mediation and then arbitration where the mediation failed. Those
were to be the exclusive means of resolving any dispute. Id. at 494. We do
not believe Taylor impliedly overruled Armstrong, because the ADR
provision in Armstrong listed a variety of forms of ADR without expressly
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requiring any one of them. Critical to the result in Armstrong was the
defendant’s failure to establish that the parties formed an agreement to
arbitrate. In Taylor, on the other hand, there was no dispute on that point.
Instantly, the parties’ agreement requires mediation and nothing more.
It never mentions arbitration:
Buyer and Seller will submit all disputes or claims that arise
from this Agreement, including disputes and claims over deposit
monies, to mediation. Mediation will be conducted in accordance
with the Rules and Procedures of the Home Sellers/Home Buyers
Dispute Resolution System, unless it is not available, in which case
Buyer and Seller will mediate according to the terms of the
mediation system offered or endorsed by the local Association of
Realtors®. Mediation fees, contained in the mediator’s fee
schedule, will be divided equally among the parties and will be
paid before the mediation conference. This mediation process
must be concluded before any party to the dispute may
initiate legal proceedings in any courtroom, with the
exception of filing a summons if it is necessary to stop any
statute of limitations from expiring. Any agreement reached
through mediation and signed by the parties will be binding (see
Notice Regarding Mediation). Any agreement to mediate disputes
or claims arising from this Agreement will survive settlement.
Agreement, 7/28/19, at ¶ 24.3 Appellants relied on the bolded portion in
support of their preliminary objection. In essence, Appellants argues that
Pennsylvania law permits an immediate appeal from any order denying a
motion to compel an application to compel any form of ADR. Nothing in the
law supports this argument. There are many forms of ADR. Mediation, which
commonly involves assisted settlement negotiations, is distinct from
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3 The Agreement appears in the certified record at Exhibit “A” to Appellee’s
complaint.
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arbitration, in which parties usually submit their case to a neutral arbitrator
with an agreement to be bound by the arbitrator’s decision.4
Because the parties’ contract contains no agreement to arbitrate, the
UAA does not apply here. No Pennsylvania statute permits an immediate
appeal of an order denying an application to compel mediation. Thus, under
the reasoning of Armstrong, we find no basis for exercising jurisdiction over
an interlocutory appeal.
Appeal quashed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 2/7/2022
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4 See, e.g., Advanced Bodycare Solutions, LLC v. Thione Intern., Inc.,
534 F.3d 1235, 1240 (11th Cir. 2008) (“Simply stated, mediation does not
resolve a dispute, it merely helps the parties do so. In contrast, the FAA
assumes that the arbitration process itself will produce a resolution
independent of the parties’ acquiescence—an award which declares the
parties’ rights and which may be confirmed with the force of a judgment.”).
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